Monday, September 29, 2008

Blame it on CAR

Fascinating brief link on Romenesko today, to a conservative blog that links to a claim that the mortgage/credit crisis is all the fault of the Atlanta Journal Constitution!

Back in 1988, Bill Dedman did a pioneering Computer Assisted Reporting project for that paper, The Color of Money, comparing mortgages issued to people in white and black sections of the county. No surprise, blacks -- no matter their income levels -- didn't get mortgages as easily as whites. Dedman won a Pulitzer Prize for his reporting.

The column linked on Red State Conservative was by Mike Masterson of the Arkansas Democrat-Gazette, who says:
...a former investigative reporter for Atlanta’s daily newspaper likely pitched the snowball that grew into the avalanche and buried our leading mortgage institutions... the practice of redlining by banks that routinely declined risky home loans in low-income neighborhoods...

Dedman replies to the Red State link,
See what he did? Hearing "black," Mr. Masterson decided that meant "low-income." He thought "black" meant "risky."
Mr. Masterson's assumption is precisely the same one that many bankers in Atlanta and elsewhere applied at that time. For years they had made loans in even the poorest white neighborhoods, while avoiding Atlanta's middle-class and more affluent black areas.

Fascinating, especially to those of us who've followed the evolution of CAR over the years.



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