Did Mike Bloomberg Really Blame the End of Redlining for the Financial Crisis?

#perspective

At the height of the 2008 economic collapse, then-New York Mayor Michael Bloomberg made a statement that has been widely discussed. He argued that the elimination of a discriminatory housing practice known as “redlining” was partly responsible for instigating the meltdown.

Redlining was a long-standing practice where banks essentially refused to lend to borrowers in minority neighborhoods, particularly black neighborhoods. Although it was officially banned under the Fair Housing Act of 1968, its effects have persisted, contributing to the wealth gap between black and white families in the United States.

Bloomberg’s comments were awkwardly phrased, and he failed to acknowledge that redlining was based on race and ethnicity, not just income. However, it appears he was trying to convey that government efforts to address the legacy of redlining led banks to take greater credit risks, which contributed to the financial crisis.

Bloomberg later denied explicitly blaming the end of redlining for the collapse, but the video evidence remains.