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FDIC Federal Register Citations

FUND FOR AN OPEN SOCIETY

August 31, 2004

Mr. Robert E. Feldman
Executive Secretary
Attention: Comments/Legal ESS
Federal Deposit Insurance Corporation
550 17th St. NW
Washington, DC 20429

RE: RIN 3064-AC50

Dear Mr. Feldman:

As the executive voice of a national organization dedicated to promoting and sustaining communities of choice for racially and ethnically robust markets, I am a critic of CRA regulations as they have been and as they would not be improved by your proposed changes.

Integrated and balanced living patterns and robust markets, an American ideal that was anticipated to be furthered by the 1968 Civil Rights Act, Title VIII and by CRA, continue to elude establishment in much of America.  In part, this is because of over-reliance on place-based—and, therefore race-based, given segregation levels--housing and community reinvestment policy and regulation. Giving (double) community-support credit for investments and services to lower-income and minority people in lower-income and minority areas is predictably segregative.

In their well-vetted book, American Apartheid, "Massey and Denton provide unambiguous evidence that residential segregation is the major factor accounting for the black underclass," avers Reynolds Farley, renown scholar. George Galster and other economists agree.

Financial institutions should be investing in removal of ghetto chains that bind too many people in geography of low opportunity. Instead, CRA credits are distributed for making the chains of American Apartheid more comfortable. And this kind of outcome is largely hidden even from those well-intentioned people representing both financial and community intereasts. How does this happen? It happens because CRA regulations do not require or even encourage integration/segregation-impact analysis. Separate and unequal prevails in a system that does not measure it and correct for it.

Your proposal may achieve less segregation by requiring less of financial Institutions, but that is not the way to fix what is wrong.

Sincerely,

Don DeMarco
Acting Executive Director
Fund for an Open Society
The Philadelphia Building #1708
1315 Walnut Street
Philadelphia, PA 19107
 

Last Updated 09/09/2004 regs@fdic.gov

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