Marc Morial Urges Candidates to Speak Out Against Gutting the Community Reinvestment Act
NEW YORK (February 18, 2020) -- National Urban League President and CEO Marc H. Morial urged the candidates for the Democratic presidential nomination to use the national debate stage on Wednesday to speak out against the Trump Administration’s proposal to gut the Community Reinvestment Act.
“As you are preparing for the debate, Trump administration officials are preparing to revise the CRA to undermine the law’s original intent and reduce the obligation of banks to lend to communities of color,” Morial wrote in a letter to the candidates. “The Trump proposal would result in significantly fewer loans and bank services for low-and-moderate-income families of color.”
Morial noted that the 2008 financial crisis was precipitated by a confluence of devastating factors, including deregulation, the availability of highly risky non-traditional lending products and the securitization of those risky mortgages. It was not connected to mortgage lending to racial minorities and low-and-moderate income borrowers, as special interests in the banking industry have falsely claimed.
“We look forward to hearing your plans to end redlining, address historic injustices and insure that every American has access to safe housing and affordable credit opportunities,” Morial wrote.
The text of the letter is below:
Dear [Candidate]:
As we approach the Democratic National Committee presidential candidates’ debate in Las Vegas on Wednesday, February 19, 2020, I urge you to reaffirm your strong and unwavering support for the implementation of the Community Reinvestment Act of 1977 (CRA). The law is designed to combat the discriminatory practice of redlining, the long-standing and government-sanctioned practice of denying African-American families mortgage loans based on the basis of race and without any consideration of creditworthiness.
As you are preparing for the debate, Trump administration officials are preparing to revise the CRA to undermine the law’s original intent and reduce the obligation of banks to lend to communities of color. The Trump proposal would result in significantly fewer loans and bank services for low-and-moderate-income families of color.
For years, special interests in the banking industry and their supporters have repeated the false narrative that mortgage lending to racial minorities and low-and-moderate-income borrowers in some way caused the 2008 financial crisis. This has been thoroughly debunked by, among other things, the Financial Crisis Inquiry Commission Report, which made clear that the crisis was precipitated by a confluence of devastating factors including deregulation, the availability of highly risky non-traditional lending products, and the securitization of those risky mortgages.
Today, the homeownership rate for black families is lower than it was in 1968 when President Lyndon Johnson signed the Fair Housing Act into law. Equally troubling is the widening gap in the homeownership rate between black and white households in America, with white households at 73.1% and black households at 40.6%.
We look forward to hearing your plans to end redlining, address historic injustices, and ensure that every American has access to safe housing and affordable credit opportunities.
Sincerely,
Marc H. Morial
President and CEO
National Urban League