Two Histories of Financiers Profiting From Real Estate While Homeowners Go Belly UpHistorians in the News
tags: book review
It’s a simple tale with a happy ending, but in “Homewreckers,” his new book about the aftermath of the 2008 financial crisis, Glantz skillfully tells a bigger story about American housing that’s tortuous, confounding and ultimately enraging.
Along with “Race for Profit: How Banks and the Real Estate Industry Undermined Black Homeownership,” by Keeanga-Yamahtta Taylor, “Homewreckers” shows what happens when private speculators get buoyed by government largess while non-tycoons are largely left to fend for themselves.
Taylor and Glantz focus on different eras, decades apart, but in a way that’s the point: When it comes to doling out public money to private business with the hope that it will inevitably trickle down, the American government is like the Bill Murray character in the first half of “Groundhog Day”: making the same mistakes over and over again, without ever seeming to learn.
“Race for Profit,” which was longlisted for this year’s National Book Award, covers the few years in the late ’60s and early ’70s, when the Fair Housing Act of 1968 nominally ended the government’s longstanding practice of redlining. Ever since its inception during the Great Depression, the Federal Housing Administration had insured mortgage loans made by private lenders for purchases in white neighborhoods; purchases in or even near black neighborhoods were generally ineligible. The benefits of homeownership swelled the ranks of the postwar middle class, transforming the economy while entrenching residential segregation.
Glantz mentions some of this history, but there’s also an overwhelming sensation of déjà vu that hovers over the more recent story he tells. In “Homewreckers,” he explains how a cadre of billionaires — a number of them living in the same Park Avenue apartment building in New York City — figured out a way to take advantage of another government program in order to profit from people’s misfortune.