Cultural IQ

Friends Don't Let Friends Pay Higher Prices

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You and your friends decide to go out to a movie on Friday night. When you get to the ticket counter, the clerk divides you into groups and charges each one a different price. Those who are well-dressed pay the lower rate. Those who are wearing less fancy clothes are asked to pay more.

What would you do? Would you go ahead and pay or back up our friends by walking away in protest?

Many readers might feel this is an unlawful act of discrimination. Special pricing for preferential customers is considered a good business strategy.

Should companies be allowed to offer lower rates (or higher rates) to its preferred customers? Frequent shoppers programs offer special discounts and lower prices. Stores often provide special incentives and discounts to residents nearby.  Newspapers offer deeper discounts and promotions to customers advertisers want to reach.

How would you feel if somebody took a look at you and then arbitrarily offered your a higher price?

That's exactly what happened in the mortgage industry. The new civil rights battlefield increasingly is a clash between classes, not racial or ethnic groups. Our treatment by society may be tied to our class: It can determine the schools we attend, the neighborhoods we can live in, and how many powerful people we know.

Some state and local governments are about to take on this issue of flexible rates and pricing. Last week, the Wall Street Journal reported that Illinois' attorney general issued subpoenas to units of Countrywide Financial Corp. and Wells Fargo & Co. for an investigation into whether lenders  improperly steered minority borrowers into high-cost loans.

"In Florida, Attorney  General Bill McCollum is looking to determine whether Countrywide put borrowers into loans they couldn't afford or loans with rates that weren't what the company was advertising or were misleading.... In January, the city of Baltimore sued Wells Fargo, alleging that it systematically targeted low-income minority homeowners for loans they couldn't afford, in violation of the Fair housing Act?," the Journal report said.

Oh, I know what some of you are thinking. Stop whining: The pricing was based upon that credit score. Well, not if we can believe the conservative Wall Street Journal, which found in 2005 that borrowers with good credit scores got 55 percent of all sub-prime mortgages.

Debora Blume, a spokeswoman for Wells Fargo, said in statement that race is not a factor in the way the company makes loans, only credit risk. (So, how did this happen that people with good credit got bad rates?) She told newspapers the company does not comment on pending litigation.

"We do not tolerate illegal discrimination against, or unfair treatment of, any consumer," the company's statement assured us. "Our loan pricing is based on credit risk. We are committed to serving all customers fairly - our continued growth depends on it."
  I don't know about you but this statement does not make me feel any better. If this was not intentional discrimination, then brokrs were not following the corporate policies. If exeutives didn't do this intentionally, then they must argue they were unaware of the patterns of racial bias and of the rogue employees who violated their pricing policies and, in some cases, brought down their companies.

Investors have reason worry when when high-salary executives argue they are innocent because nobody told them what was really going on. Good parents always know what their kids are up to, and capable CEOs know when something has gone wrong.

As for the rest of us, well, people, we allowed this to happen. We knew that friends and neighbors were unfairly charged higher prices for loans, and yet we continued to look the other way. After all, we had more important things on our plate. While the government has stepped in to help lenders, homeowners are left with homes they can't afford. ( The National Community Reinvestment Coalition says corporations have received $230 billion in federal aid compared to nothing for homeowners.)

The lesson? Friends Don't Let Friends Pay Higher Prices. If we had followed that golden rules, thousands of Americans wouldn't have lost jobs.

Weekly News Roundup

NEW York TImes:

In DNA Era, Worries About Revival of Prejudice 

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By AMY HARMON 

Research is exploring how DNA explains racial differences, but it could give discredited prejudices a new potency.

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LOS ANGELES TIMES: LAPD Defends Muslim Mapping Effort

By Richard Winton, Teresa Watanabe and Greg Krikorian

The LAPD's plan to map Muslim communities in an effort to identify potential hotbeds of extremism departs from the way law enforcement has dealt with local anti-terrorism since 9/11 and prompted widespread skepticism Friday. In a document reviewed Friday by The Times, the LAPD's Los Angeles Police Department's counter-terrorism bureau proposed using U.S. census data and other demographic information to pinpoint various Muslim communities and then reach out to them through social service agencies.

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WASHINGTON POST: How to Win The War Of Ideas

By Robert Satloff 

The resignation of Karen P. Hughes as undersecretary of state for public diplomacy gives President Bush an opportunity to fix one of the most glaring blunders in his administration's response to the attacks of Sept. 11, 2001-- a failure to prioritize ideological warfare over public relations. Today, most Americans believe that the United States is fighting three wars: in Iraq, in Afghanistan and against violent Islamist extremists around the world (i.e., "the war on terror"). But as the Sept. 11 commission pointed out, we are, more accurately, engaged in what can be considered a fourth war, against the spread of the ideology of radical Islamism. In this war, the battlefields are the many cities, towns and villages where extremists seek to impose their absolutist view of sharia-based rule. The stakes in this contest are no less consequential for U.S.interests than those in the other three wars -- perhaps greater.

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Houston Chronicle:New Houston Opera Gives Immigrants A Voice

By CHARLES WARD

The Refuge, with music by Christopher Theofanidis and libretto by Leah Lax, will sketch the often-heart-wrenching stories of seven groups of immigrants, sometimes individually, sometimes collectively. It premieres Saturday as part of Houston Grand Opera's ongoing outreach program, The Song of Houston.

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THE OREGONIAN:

Stunts at OSU strike a nerve of bigotry

By EDWARD WALSH

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Oregon State University junior Casey Grogan's idea seemed innocent enough: Encourage students to wear all-black clothes to a football game last month in a show of school spirit. Instead, Grogan's plan set in motion a chain of events that has highlighted the issue of racial sensitivity on the Corvallis campus and riled the feelings of the university's tiny minority of African American students. Two unrelated events -- a photo of a white student in blackface promoting the stadium "blackout" and the discovery this week of a noose hanging from a tree outside a fraternity house near campus -- quickly came to symbolize the tension that some of OSU's 297 African American students say they regularly experience on the 19,753-student campus.

Seeing the World Through Innocent Eyes

Every now and then, there comes a time in an adult's life where a child opens our eyes so we can see the world's wonders far more clearly.

My moment arrived more than 15 years ago, as I was standing on a street corner in a West Dallas housing project waiting for the bus to arrive and take the children to their elegant elementary school in tony North Dallas. I, the well-educated reporter, was there to report on them, the poor, disadvantaged kids from the inner city who rode buses to affluent schools in an effort to achieve educational parity.

I wasn't there more than two minutes before our roles as adult and child switched. An obnoxious drunk began pestering me, and making lewd comments. I ignored him and cast my eyes away. A wary group of 6- to 8-year-olds watched the drama unfold. Finally, one of the boys walked up to me, tugged on my jacket and asked, "Lady, is that man bothering you?

I looked into the eyes of a 6-year-old. "Yes," I said.

The child wandered over to the man, quietly reasoned with him, and my tormentor stumbled away. The children looked at me kindly, the way a rich child might reach out to a child who has no food. I could read the message on their faces, "We hope this woman will be able to make it through the rest of our day."

That experience dramatically changed my life ’Äì because it made me reconsider the labels I so freely used to define "other" people, especially those who fell short of societal standards. No doubt there was a disadvantaged person on the street corner that day, but it was the woman with the bachelor's degree and not the children from the projects.

Never again as a journalist would I refer to these students as "poor" or "disadvantaged" because I truly saw the injustice in describing only what they lacked, but never what they had gained.

It took a child to teach a journalist that even those who live in poverty have resiliency, survival skills, wits, intelligence, and abilities that give them distinct advantages, at times, over their better-educated peers.

The terror swirling around the sniper shootings in the affluent communities in Washington, Maryland, and Virginia made me think about these children and their advantages a lot lately.

News shows raced to educate parents on helping sons and daughters cope with fear. Schools closed their doors or locked students inside. Recess and football games were cancelled. People stayed home from work, and the economy dipped as malls, restaurants, and movie theaters lost customers to a competitor with whom they could not compete: fear.

Meanwhile, in urban areas like Washington, Philadelphia, New York, Boston, Los Angeles, Chicago, Dallas, and Houston, where violence and fear are in permanent residence, children continued to play outdoors and, on occasion, even take a standagainst evil.

In Philadelphia in September, an 11-year-old walked into a police station to report a terrible crime. The boy said his father made him sell bags of marijuana on street corners, and when he cried that he didn't want to do it anymore, he had been beaten unmercifully. Fed up, he took it upon himself to turn his father in. Strangers called him a "hero."

Who among us wouldn't desire our children to be so brave, so self-reliant, and so principled? Or to have the heart of Carnell Dawson Sr. and his wife, Angela, of Baltimore who were killed along with five children in an arson fire that police said was set in retaliation for the family's efforts to rid their neighborhood of drugs? The Dawsons were freedom-fighters. If we measured people by character instead of assets, they'd be considered wealthy folk.

My point is that every person and every group is advantaged and disadvantaged in some way.

So, when we use labels, let's use them with care. We have to stop and consider whose yardstick we use to measure others. When we measure others using our yardstick, they tend to come up short. When they measure us with their yardstick, it is we who may end up looking feeble.

Every human being has strengths and weaknesses. That is a lesson we can learn from children if only we take a moment to see the world through eyes of innocence.

Lessons for A City

One topic of conversation can make voices rise and hopes fall in a room of  CEOs:  Why aren't there more highly skilled workers?

America needs to keep its industries competitive. Beyond reading, writing and arithmetic, executives suggest that creative workers need critical thinking skills, effective communication skills, the ability to work in groups  and the ability to solve problems.

(The Society of Human Resource Management's excellent report on 21st century workforce skills (http://www.21stcenturyskills.org) notes that these contemporary workers also need cross-cultural skills to succeed.)

"This study should serve as an alert to educators, policy makers and those concerned with U.S. economic competitiveness that we may be facing a skills shortage," Susan R. Meisinger, President and CEO of the Society for Human Resource Management, says of the report.  “In a knowledge-based economy a talented workforce with communication and critical thinking skills is necessary for organizations and the U.S.to be successful."

OK, now let’s consider the research of Robert Putnam, author of Bowling Alone: the Collapse and Revival of American Community. His book - which some argue is a sign that diversity is dead - found that our society is losing social capital as people and communities become less connected, and less engaged. This is especially true, it seems, in diverse neighborhoods.Does that mean everything would be OK if we are all more alike? Well, of course not.

It fails to consider the possibility that the lack of communication skills, critical thinking skills, teamwork and problem-solving capability might ALSO be creating tensions among the races, and prompting people to stay within their comfort zones. We don't know what to say, so we don't say anything.

Blaming diversity for the decline in social capital is a little like blaming math when students get the equations wrong. Perhaps our problem is not that we are different but rather that our community is not skilled enough to manage those differences. Why the heck aren’t we?

That question takes us to the doorsteps of universities and school districts. Are educators providing the applied skills and social intelligence that American workers need to manage 21st century business challenges? If we can’t connect with people in our own neighborhoods, how can we expect to connect with strangers half a world away?

“It is clear from the report that greater communication and collaboration between the business sector and educators is critical to ensure that young people are prepared to enter the workplace of the 21st century,” says Richard Cavanagh, President and CEO of The Conference Board. “Less than intense preparation in critical skills can lead to unsuccessful futures for America’s youth, as well as a less competitive U.S.workforce. ”

Cities that create skill-building projects and cultural competency initiatives are going to be the first to solve “the diversity problem.” They get a happier and healthier business community as a bonus prize

Those communities content to blame diversity for their plight – rather than look for systemic weaknesses - are going to have to answer their children one day when they ask, “Daddy, mommy, why aren’t there any jobs?”