Gaskin: Economic sanctions crush Black communities

Published: Saturday, August 30, 2025 at 7:14 am

Economic Sanctions: A Domestic Parallel

Economic sanctions, often employed by the United States against foreign nations to cripple their economies, have a disturbing parallel in the historical treatment of Black communities within the country. According to a recent analysis, the systematic denial of financial services to Black Americans, through practices like redlining, segregation, and discriminatory banking, functioned as a form of domestic economic sanctions.

These policies, which did not require military force, effectively created "financial containment zones" by restricting Black families to specific neighborhoods. This denial of basic infrastructure, such as paved roads, quality schools, and sanitation, hindered community development. Segregation also led to the devaluation of homes in Black neighborhoods, contributing to a significant racial wealth gap. A 2018 study found that homes in majority-Black neighborhoods are undervalued by an average of $48,000 per home, resulting in $156 billion in lost equity.

The federal government's codification of these boundaries through redlining in the 1930s further exacerbated the issue. The Home Owners Loan Corporation (HOLC) mapped Black and immigrant neighborhoods as hazardous for investment, leading banks, insurers, and mortgage lenders to follow suit. This effectively cut off Black families and businesses from capital markets, while white veterans benefited from programs like the G.I. Bill.

The consequences were predictable. Black entrepreneurs faced difficulties in opening or expanding businesses due to a lack of loans and insurance. Those who attempted to buy homes were often steered into predatory land contracts. Black business districts, starved of capital and infrastructure, began to collapse. Studies show that Black business owners continue to face loan denial rates higher than white-owned firms.

While redlining was officially banned in 1968, its effects persist. Formerly redlined areas remain among the most disinvested in America. New forms of capital exclusion, such as algorithmic lending biases and property appraisal disparities, continue to obstruct economic mobility in Black communities. The estimated total wealth lost due to these practices ranges from $2.0 trillion to $2.6 trillion.

BNN's Perspective:

The historical and ongoing economic disadvantages faced by Black communities are a serious issue. While the legacy of redlining and discriminatory practices is undeniable, addressing these issues requires a balanced approach. It's crucial to acknowledge the past while focusing on policies that promote economic opportunity and equity for all, without resorting to divisive rhetoric.

Keywords: economic sanctions, redlining, segregation, racial wealth gap, Black communities, discriminatory banking, home values, HOLC, G.I. Bill, predatory contracts, loan denial, economic mobility, equity, financial exclusion, wealth disparity

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