This week’s reading is a great example of Institutional racism. The HOLC and FHA were government-sanctioned programs that intentionally discriminated against black and minority families, and segregated the United States.

In our class discussions, we talked about how housing shapes the lives of people, because it affects ease of accessibility to various things such as work opportunities, healthcare and quality of education. And so when the Great Depression came in, naturally it was a concern for the Federal government to reduce unemployment, stimulate the economy, and incentivize homeownership. While the original aims of the HOLC and FHA seemed virtuous, in practice they were made to favor all-white neighborhoods. These programs were segregationist policies at its core.

HOLC’s appraisal methods were extremely bigoted because they deemed a neighborhood low-rated if there were presence or black or hispanic families. I find this upsetting because their rating system was their way of determining racial worth. Minority family neighborhoods were neglected, which is shameful because the government has a duty to protect all of its citizens.

The FHA further adopted these appraisal methods and incorporated the act of lending out mortgages based on neighborhoods. Their housing policy strictly favored a rigid white-black split, and considered a mixing of black families in white neighborhoods “inharmonious”. Perhaps the greatest impact the FHA had, which can still be seen today is it’s dangerous precedence of legitimizing mortgage lending practices based on geographic location. Because our government found that it was okay to enact racist lending practices, our private banks followed suit and still carry out these same practices today. The FHA can thus be argued as a policy that institutionalized racism in our housing and banking industries.