Week 7 Post 1

 Week 7 Post 1- Notes 

Chapter Name- IRS Support and Compliant Regulators





  • The thirteenth, fourteenth, and fifteenth amendments were written specifically to protect black people from constitutional rights being violated 
  • De jure segregation is committed when state real estate commissions publish codes mandating discrimination 
  • We cannot blame church’s and universities as part of the state, but we can acknowledge that we have the right to expect that if these private institutions promoted segregation they would not get tax exceptions 
  • “The IRS has always had an obligation to withhold tax favoritism from discriminatory organizations, but it almost never acted to do so”
  • IRS regulations allow for charity deductions for organizations that “eliminate prejudice and discrimination” and “defend human and civil rights”
  • the irs still granted tax exceptions to private whites only school until 16 years after brown v board 
  • The IRS denied a tax exception to bob Jones in 1976 for not allowing interracial dating 
  • The university took this to SCOTUS where it was held up
  • It was very common for churches to lead the neighborhood associations that were trying to uphold segregation 
  • In Shelly v Kramer the kraemer family was backed by their local Presbyterian church 
    • A church in LA had a reverend who tried to evict a black man to keep the neighborhood all white. He lost in court, but his actions did not change his church’s tax subsidy
  • Violent resistance to African American housing projects in Detroit was led by a neighborhood association headquartered in a Catholic Church 
  • The reverend wrote that this would be utter ruin for white families in the neighborhood and “would endanger our white girls”
  • A catholic priest, a rabbi, and a congressional minister were apart of a petition on chicagos south side to make a restrictive covenant 
  • From 1933 to 1947 UChicago spent 100,000 dollars supporting orgs that were creating racial covenants to stop black people from moving in around the college
  • Universtiy president wrote that they had a 'right to defend' their neighborhood
  • State legislature in New York supported insurance companies when they were insuring housing in developements they knew were excluding African Americans
  • The city of New York approved another whites only development under the condition that they would not approve anymore segregated devlopements where they would need to destroy slums
  • Metropolitan life finally allowed African American tenants, but kept their rent lates so low that white families didn't want to move out, making it hard for those tenants to actually move in
  • New York cleared out a neighborhood that was 40 percent black or puerto rican to make these homes
  • Black families could not get loans through the FHA, and private banks and thrifts could refuse loans to whoever they want
  • The Federal Home Loans Bank Board only began considering giving african americans loans in 1961
  • The FDIC and Comptroller of the Currency both said that they had no right to tell their bankers who they needed to give loans to, and thought it unfair to give loans to black families as they felt it would hurt white neighbors
  • National banks are instruments of the federal government, so allowing them to implement segregation is directly de jure segregation
  • "Reverse redlining"- Excessive marketing of exploitative loans in African American communities. These loans contributed to the 2008 housing crisis because they were subprime loans and bound to collapse
  • Brokers could earn bonuses for offering subprime loans with high interest rates that would benefit the banks and harm buyers
  • The federal reserve banned this practice in 2010, but previous victims on this scam were never compensated
  • Higher- income african americans were three times more likely to haves suprime loans as higher income whites in 2000
  • The federal reserve took no action even in 2005 when African Americans were recieving suprime rates at hugely higher rates than white people in every economic bracket
  • The federal reserve agreed in 2010 that african americans were more likely to get foreclosure becasue they had recieved targeted loans that were unfair
  • Countryside was sued by the government for it's unfair loan practices, since the government claimed there was no way they did not know that it was racially charged
  • Countrywide's racial policies operated with the knowledge of the federal reserve for decades
  • The City of Memphis sued Wells Fargo over the calling of subprime loans 'ghetto loans'
  • The Baltimore wells fargo had an all-black team that was supposed to go to black churches to try to sell subprime loans
  • Memphis Wells Fargo supervisors called black people 'not savvy enough' to understand they were being scammed with their loans, and some specifically targeted elderly african americans who they believed they could manipulate
  • Cleveland stated that their banks had created a public nuisance with the aftereffects of their subprime loans


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