Note: this item was originally published on October 10, 2008
Throughout this long presidential campaign, there’s been endless discussion of race as a factor. But until recently, such talk revolved around hard-to-assess white fears about Barack Obama’s racial identity, along with efforts to conjure up the ancient hobgoblin of the Scary Black Man via images of Obama’s former pastor, Jeremiah Wright.
Now, in the wake of the ongoing financial crisis, racism has entered the campaign conversation from an unexpected direction. In the fever swamps of conservatism, there’s a growing drumbeat of claims that the entire housing mess, and its financial consequences, are the result of “socialist” schemes to give mortgages to shiftless black people whose irresponsibility is now being paid for by good, decent, white folks.
Some of this talk is in thinly-veiled code, via endless discussions on conservative web sites (though it spilled over into Congress during the bailout debate) attributing the subprime mortgage meltdown to the effects of the Community Reinvestment Act of 1977, which was aimed at fighting the common practice of mortgage “redlining” in low-income and/or minority areas (basically, a refusal to make any mortgages, regardless of the creditworthiness of individual applicants, in such areas).
In truth, the CRA didn’t require lending to unqualified applicants (though it did provide that applicants’ credit-worthiness could be established through means more sophisticated that standard credit scores), and in any event, CRA doesn’t even apply to the non-bank lenders responsible for the vast majority of bad mortgages. (Sara Robinson has a very useful primer on CRA at the OurFuture blog).
A closely associated and even more racially tinged element of the conservative narrative on the financial crisis focuses on lurid claims about the vast influence of ACORN, a national non-profit group active in advocacy work for low-income Americans. Among its many activities, ACORN has promoted low-income and minority homeownership, mainly through personal counseling. More to the point, though it’s unrelated to any of the claims about ACORN’s alleged role in the financial crisis, the group worked with Barack Obama back in his community organizing days on the South Side of Chicago.
Now as it happens, I’ve never been a huge fan of ACORN, mainly because its ham-handed voter registration efforts in recent years have supplied Republicans with their only shred of evidence that “voter fraud” is a legitimate concern in this country. But ACORN, a relatively marginal group, had no real influence over toxic mortgage practices, which again, to state the crucial point, had little to do with CRA-enabled loans to low-income and minority homeowners. Google “ACORN financial crisis” and you’ll be treated to an amazingly huge number of articles and blog posts on the subject, virtually all of them from conservatives. None of them, so far as I can tell, establish that the group has had any significant involvement in mortgage decisions, mainly because most subprime loans were made in areas where ACORN activists would never set foot. ACORN is being singled out by conservatives for a leading role in the crisis simply because it’s crucial to the whole CRA/Socialist/Minorities/Fannie Mae/Freddie Mac/Obama narrative about the financial crisis. And that narrative is not simply all over the internet: it’s common on the airwaves as well, from Lou Dobbs to an assortment of “analysts” at Fox.
While some conservatives are careful not to get too explicit about the racial underpinnings of this argument, others aren’t.

As usual, we can rely on Ann Coulter to expose the raw id of conservative sentiment, as in a post on the financial crisis with the title: “They Gave Your Mortgage To a Less Qualified Minority,” which deliberately played off the theme of a famous Jesse Helms campaign ad demonizing affirmative action.
Here’s Coulter’s take on the alleged impact of CRA:

Instead of looking at “outdated criteria,” such as the mortgage applicant’s credit history and ability to make a down payment, banks were encouraged to consider nontraditional measures of credit-worthiness, such as having a good jump shot or having a missing child named “Caylee.”

Nice. The coda of Coulter’s “argument” plows some very familar furrows:

Now, at a cost of hundreds of billions of dollars, middle-class taxpayers are going to be forced to bail out the Democrats’ two most important constituent groups: rich Wall Street bankers and welfare recipients.
Political correctness had already ruined education, sports, science and entertainment. But it took a Democratic president with a Democratic congress for political correctness to wreck the financial industry.

There you have it: once again, rich liberals in league with shiftless minority “welfare recipients” are sticking it to Joe Sixpack.
Coulter’s uninhibited take seems to be closer to what we are now seeing and hearing among grassroots conservatives, whose anger is now visibly spilling onto the campaign trail, than the more circumspect “analysis” of her more “responsible” colleagues.
It shouldn’t be that surprising. Let’s say you are a classic Main Street conservative, a white middle-class man near or past retirement age. You own your home, you pay your bills. Maybe at some point you benefitted from a government-subsidized or underwritten home loan. Maybe you were lucky enough to do your own modest real estate speculation in the mid-80s or mid-90s or early 00’s, when it all worked. Maybe you even have a defined-benefit pension that insulates you from the immediate effects of the stock market collapse. But still, you’ve played by the rules, and are entirely innocent. And now the whole economy is collapsing around you, and worse yet, many hundreds of billions of your taxpayer dollars are being tossed around Washington to “bail out” everybody but you. Two kinds of explanations are being offered to you for what went wrong. One involves an impenetrable haze of financial jargon about the securitization of mortgages and derivative instruments and hedge funds, which only a handful of people in the country can even pretend to understand. The other is Ann Coulter’s. What are you going to believe?
Perhaps it’s an ironic sign of social progress that today’s emerging racist stereotypes involve minorities getting behind on their mortgage payments, rather than “welfare queens” using change from their food stamps to buy vodka (the famous Ronald Reagan anecdote) or black men impregnating their girlfriends to live off those bountiful welfare payments. But it’s still disgusting. As Rick Perlstein has righteously argued, it’s a blood libel on people who exert no real power in this country.
As the foregoing meditation indicates, I’m less inclined to blame those fist-shaking angry Main Street conservatives at McCain’s rallies than the conservative “thinkers” who promote racist stereotypes as part of a broader effort to deflect responsibility anywhere, everywhere, than towards the corruption and ideological manias of their own leaders.
UPCATEGORY: Editor’s Corner
Grassroots conservatives have been fed a steady, toxic diet in recent weeks, on talk radio, on Fox, and in the blogs, of a narrative that suggests “Obama’s ACORN” (with the complicity of Fannie Mae/Freddie Mac) created the financial crisis, is benefitting massively from the bailout, and is now trying to steal the election. This is a race-based Unified Field Theory that connects everything these folks fear and hate, and they want John McCain to talk about it, instead of all this bushwa about greedy lobbyists and bipartisanship.
On a broader front, this may represent the ultimate climax in the original and central dilemma of the McCain campaign: how to stay “bipartisan” and mavericky while channeling the passions of the conservative base. The whole contrived balancing act could well be blowing up, at McCain’s own rallies.