racism and the economic crisis

racism and the economic crisis
For The Old Mole February 9, 2009
from blog1001

Racism is arguably both a cause and a consequence of the current economic crisis.

Joe Sims, writing in the Black Commentator, notes that there are many explanations for the present disaster, including “'financialization' or the capitalism-on-crack of the bond markets and banks, a crisis of overproduction (too many goods chasing too few dollars), and a weak “real” economy due to insufficient allocation of surplus capital to productive investment. Some point to objective processes, others stress mistaken policy decisions. Clearly all were, to one degree or another, at play." But, he continues, "Also at work was institutionalized racism in the form of unfair lending policies that systematically targeted Black and Latino homeowners." As a result, of course, people of color are among the first to be hit by the collapse and to see their homes foreclosed and their jobs eliminated.

Nonetheless, people of color and especially immigrants have faced attempts to blame them for the economic crisis and to shift even more of the suffering onto their backs. For instance, some commentators blamed the Community Reinvestment Act for lending to minorities, though the subprime loans were not subject to CRA regulations. Others blamed mortgages given to undocumented immigrants, though the Department of Housing and Urban Development has dismissed these allegations as baseless. When Congress was discussing the stimulus plan, the Associated Press reported –and later retracted—a false claim that the American Recovery and Reinvestment Act would allow undocumented immigrants to claim tax credits. Although House Speaker Nancy Pelosi and House Minority Leader John Boehner issued a joint statement stressing that the House bill "would not allow any taxpayer funds to be distributed to" undocumented immigrants (not even the ones who pay taxes), Fox Network sources continued to repeat the false claims.

In Columbia County, voters this past November passed Measure 5-190, which would impose fines of up to $10,000 and threaten the loss of business licenses for employers who knowingly hire illegal immigrants. Opponents of the measure and their representatives, including the Northwest Workers’ Justice Project and the ACLU of Oregon, successfully sought an injunction that has prevented the measure from going into effect The very fact that the measure passed by 57 percent of the vote, however, suggests the hostility to immigrants that can sometimes take more violent forms.

Scapegoating and hostility to immigrants has been on the rise for some time. According to FBI statistics, from 2003 to 2007, anti-Latino hate crimes increased by 40 percent. In the New York area, the Justice Department is investigating the beating deaths of two Ecuadorian men in separate incidents, as well as other cases that may have been improperly handled by local police.

At Portland's recent Town Hall on the economic crisis, presenters at the workshop on Uniting Across Racial and Ethnic Divides noted that such responses are likely to increase as the economy continues to decline. Organizers with cross-border group enlace international noted parallels with Mexico's 1995 financial meltdown and bailout, which led to further corporate profits and immiseration of workers. As an alternative, they suggest taxing the bailout, 2.3 billion dollars of which has gone to eighty-seven Oregon corporations. Pointing out that state government has to pay half the cost of emergency room care for the uninsured—a group that increases every day as workers are laid off and lose health insurance—enlace suggests that a fifteen percent tax on that 2.3 billion payout would finance emergency room services for the uninsured in Oregon for the next two years, even taking into account the likely increase in the number of uninsured Oregonians.

Organizers with other local groups—including VOZ workers rights education project, the Center for Intercultural Organizing, and the Office of Neighborhood Involvement--similarly stressed the importance of working together across racial and ethnic barriers in order to work effectively for economic justice. We need to remember not to buy into a model of scarcity that keeps us pitted againt each other for scraps, while the wealthy elite continue to profit from our suffering.

Raymond Lawrence in Counterpunch writes, "There is plenty of money in this country. Most of it just happens to be held by a very few people. . . . There are more than 400 billionaires [in the US] and a great many more fabulously rich persons whose wealth amounts to something less than a billion. . . . It is not easy to wrap one's mind around a billion dollars. A billion is a thousand million. To grasp the difference between a million and a billion dollars, consider the following: If a millionaire spent or gave away a dollar a second, or sixty dollars a minute, continually around the clock, the million dollars would be exhausted in 13 days. On the other hand, if a billionaire were to do the same, the money would last for 32 years. . . ." Lawrence proposes that "we levy a . . . national 'property tax' on all financial wealth above, say, three million dollars, and call it an 'infrastructure fee' based on financial wealth. . . . " Lawrence takes as one example the State of Virginia, currently facing a $2.9 billion shortfall over the next two years. In response, the Governor proposes to cut Medicaid funding, which provides health care for almost a million Virginians, reduce public school funding by 15%, cut school construction, release some number of prisoners early, cut 1500 state jobs, and borrow against the future. "If the state of Virginia imposed a 15% infrastructure fee on its own Virginia billionaires, the state deficit would be entirely erased for the next two years, with money left over. The billionaires would hardly feel the pinch. And this does not include a possible similar levy on all those who are simply multi-millionaires."

Of course, in order to get the billionaires to pay up on their taxes, we might have to offer them all cabinet posts.

But there's another way to get things done. Joshua Holland in Alternet notes that with the exception of the United states, "the whole world is rioting as the economic crisis worsens." Naomi Klein, writing in the Nation, points out that taking to the streets has gotten positive results from Iceland to Canada. "The pattern is clear: governments that respond to a crisis created by free-market ideology with an acceleration of that same discredited agenda will not survive to tell the tale."