The bankruptcy of racism


Many of the topics we discuss here are personal, at least insofar as race is concerned. We talk about the effect race has on colouring people’s experiences, on how they may perceive identical treatment quite differently. I’ve occasionally shared some anecdotes from my own life to underscore some point or another. This is no accident – race and experiences of racism are incredibly personal, and the facts can often not be divorced from the subjective experience.

That being said, I hope that you haven’t been left with the impression that racism only has interpersonal consequences. From the get-go, I have been trying to convey the fact that attitudes about race work their way into every aspect of our lives, often without our knowledge or consent (and certainly without the consent against whom the weight of racism is pressed).

It is a fact, therefore, that if you scratch the surface of just about any human activity, you will find racism simmering just below the surface:

Blacks are about twice as likely as whites to wind up in the more onerous and costly form of consumer bankruptcy as they try to dig out from their debts, a new study has found. The disparity persisted even when the researchers adjusted for income, homeownership, assets and education. The evidence suggested that lawyers were disproportionately steering blacks into a process that was not as good for them financially, in part because of biases, whether conscious or unconscious.

I spoke recently about the challenge of measuring racism – that it cannot be measured directly, only by stripping away all other explanatory factors. It is a rare study that manages to do that completely, but this one comes pretty damn close. If you can ninja your way around the paywall, the study can be found here*.

This study, much like last week’s, is actually two different experiments with the same model hypothesis: that race plays a role in the type of advice an attorney gives hir client.

The Claim

Braucher and colleagues identify two different types of bankruptcy filing: Chapter 7 and Chapter 13. Without going into all the details (which I don’t understand fully myself), Chapter 7 can be thought of as “the cheap one”, with an up-front payment and the liquidation of some assets. The authors make this remark:

In practice, chapter 7 seems to maximize the ideal of forgiveness, giving “the honest but unfortunate debtor… a new opportunity in live and a clear field for future effort, unhampered by the pressure and discouragement of pre-existing debt.” (p. 2)

Chapter 13, on the other hand, usually involves 3-5 years of repayment and is much more expensive. The advantage is that this method allows people to hang on to their home or car instead of having it liquidated. However, this means that you are wrangling with bankruptcy for years instead of a one-time procedure that allows you to move on quickly.

The authors hypothesize that racist attitudes extant in attorneys will drive them to recommend differentially between black and white clients, regardless of the other facts of the case.

The Prediction

If the hypothesis is correct, then what we will see is a difference in the type of bankruptcy filings that is explained by race but not by factors like income, location, age, education, or other potentially predictive factors (i.e., race will remain when these other variables are ‘controlled for’ in statistical analysis).

The Test

In the first exercise, the authors used data from a questionnaire distributed by the Consumer Bankruptcy Project. These data included all relevant information concerning bankruptcies filed in 2007, including a variety of financial characteristics, a record of attempts to settle debt load with creditors, demographic characteristics (including race), and a proxy variable for the local legal culture.

In the second exercise, they asked attorneys in various parts of the United States to provide a recommendation for a case study couple**. The couple was identical in every way except one – their name. One third of respondents were asked to provide advice to “Todd and Alison”, one third were asked to provide advice to “Reggie and Latisha”, and the remainder were asked to provide advice to clients identified only by first initials.

The Findings

The results from the survey were very compelling:

Table 1 - click to enlarge

I’ve left the statistical tests for significance up there, but the important information is at the top of the table. You can see that race makes the odds of being steered toward a Chapter 13 bankruptcy are more than 3 times as high for black filers as white ones. This effect diminishes only a little when financial circumstance, filer preference, location and the legal culture are included in the analysis. What persists is the effect of the client’s race.

The results from the second exercise tell much the same story:

Figure 1 - click to enlarge

You can see from the pattern of these bars that the ‘white’ clients were far less likely to be directed to choose a Chapter 13 bankruptcy (more likely to be steered toward Chapter 7) than were black ones. When racial cues were not available in the case, the pattern resembles whites more than it does blacks.

What is interesting, and what I will have to discuss another time, is the fact that the authors also included a variable to rate the “trustworthiness” and “competence” of the clients. The results will require a more detailed analysis than I can provide right now, but basically white clients were viewed as being “more competent” and having “better values” if they expressed a preference for a Chapter 7 bankruptcy. This patterns was reversed for black clients.

The Conclusions

There is much more in this paper that will have to be left unpacked for now, and I will return to it another day because I really do want to talk about the differences in perception, but the important message to take home from this study is that racist attitudes (that are, probably, implicit rather than explicit) do not just affect our perceptions of events. They have real impact on our lives.

In this case, we see that attitudes about race have a deleterious effect for black people, not because of any dearth of ‘personal responsibility‘ or any other “racial realist” canard, but because white people are seen as deserving of a second chance that blacks simply do not qualify for. While people will swear up and down that nobody ever gave them a handout, or that they’ve pulled themselves up by their bootstraps, what their fanciful narrative neglects is the existence of a white supremacist system that hands out advantages like this based on skin colour.

The authors make a pair of policy recommendations, one of which is to collect more information. The second, and the one that fits the message of this blog closely, is that attorneys need to be educated about the existence of this kind of bias. Whether telling people (especially certain people**) about the possibility of inadvertent racism will actually fix the problem is certainly an open question, at least they will no longer be able to claim ignorance of the problem.

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*The paper is ‘in press’, meaning that it will be published in an edition of the journal that is, as yet, not available. 

**Hilarious and unimportant factoid from the study. The attorneys surveyed were asked to identify their own race (to see if the race of the attorney played a role). One participant identified hirself as a “Confederate American”. Oh America, you so silly.

Citation: Braucher, Jean, Cohen, Dov and Lawless, Robert M., Race, Attorney Influence, and Bankruptcy Chapter Choice (January 20, 2012). Journal of Empirical Legal Studies, Forthcoming; Arizona Legal Studies Discussion Paper No. 12-02. Available at SSRN: http://ssrn.com/abstract=1989039 or http://dx.doi.org/10.2139/ssrn.1989039

Comments

  1. ash says

    An old thought-expiriment of mine comes to mind. Alien anthropologists come to America and do extensive sociological data collecting on all of The U.S’s institutions and people involved in those institutions. The thing is, the aliens are unable to decern between “races” visually.

    One day one of their top inventors creates special contact lenses that allow them to “see” the differences.

    Q: How do these differeces now correlate with the mountains of data collected.

  2. ash says

    That reminds me of your post(s) on the well intentioned yet insidious idea that colorblindness is a good thing. The problem admitting it is that when you have that kind of information, you become responsible to that information.

  3. Cynthia says

    That’s a revealing and terrifying paper. Clears up some mysteries for me, that’s for sure. And makes my stomach hurt, too. After all this time, all the effort, all the education, people still…suck.

    Depressing. And uplifting at the same time. I’m even more determined to not back down when I see racist thoughts polluting my world.

  4. says

    But that’s the thing – this isn’t about sucky people. We ALL have these blind spots, we are ALL part of the system. We have to recognize and own this fact for ALL of us, not just ‘racists’. The key will be to see how attorneys and judges react when this information is presented to them. If they fight back and refuse to change, THEN is when you can start talking about sucky people.

  5. Dianne says

    One thing that struck me on a first read through is that the attorneys tended to push people into taking the option that they associated with better values. They tended to push whites into accepting chapter 7 because they associated that with better values if the client was white and the opposite for blacks. But overall the pattern suggests that they were trying to advise clients to do the moral thing. Whatever that means to the question of how to deal with the underlying racism.

  6. Dianne says

    In general I agree. However, I think we can probably categorize the “Confederate American” as a sucky person right off without waiting for further confirmation.

  7. says

    Well the issue is that what “the moral thing” is depended on the race of the client. Morality is not something that shifts with race. Blacks were essentially thought to be more ‘moral’ when they took the harder road and ‘paid their dues’ in the filing. Conversely, whites were seen as more deserving of ‘a second chance’. This meshes pretty tightly with a view that when black people fail it’s because they made bad choices, but when whites fail it’s bad luck.

    Yassin Bey (Mos Def) has a good line about this: “If white boys doin it, well, it’s success/When I start doin, well, it’s suspect”

    http://www.youtube.com/watch?v=NZxmuMmPLUU

    Incidentally, if you were ever unclear on the definition of the term ‘microaggression’, this song has some great examples.

  8. Dianne says

    Well the issue is that what “the moral thing” is depended on the race of the client.

    That’s something I find fascinating, in a car crash sort of way, about this whole thing: whites are not only seen as “more deserving” of a second chance, they are seen as more moral when they ask for a second chance. Huh?

  9. says

    I see it as being a reflection of the client’s wishes matching up with the attorneys’ expectations. I am more likely to see a politician as ‘honest’ and ‘trustworthy’ if she shares my values. I have a harder time extending the benefit of the doubt to someone who, for example, wishes to lower corporate tax rates to spur job growth (a policy that has nothing to do with honesty or trustworthiness per se). The attorney thinks blacks should work harder to pay for their bad decisions, and if the couple shares hir expectation, that reflects better on the couple’s overall competence and morality.

  10. Desert Son, OM says

    One participant identified hirself as a “Confederate American”. Oh America, you so silly.

    Ok, re-de-lurking with another book recommendation. First, declaration of biases: again, much of my perspective is one from the United States, and again, among my privileges is lack of anything but cursory knowledge of Canada (or as I heard comedian—and Canadian!—Stewart Francis once jokingly refer to it, “Canadia”).

    Mississippi by Anthony Walton. Walton is one of the editors of Every Shut Eye Ain’t Asleep that I recommended in comments in Crommunist celebrates Black History Month. (By the way, thanks, Crommunist, for your kind reply.)

    Walton’s family history is intimately tied to the history of Mississippi, one of the most impoverished states in the United States across manydifferentcategories. Among many issues Mississippi grapples with is the state’s flag.

    Walton’s Mississippi is just one narrative exploring many of the racial issues facing Mississippi (and by extension, the larger U.S.), and he intricately presents the issues through the lens of his family’s relationship to the state. It’s a powerful book.

    Thanks for this great post. Reading about the lawyer who identified as “Confederate American” is another in a long chain of reminders that the United States is still fighting the Civil War that ended in 1865. One of the challenges we face is recognizing, admitting, and including (not omitting!) our historical ills: we must examine our privilege. It is critical in order to work for a better future. This research paper is one example of the effort to do just that. Fannie Lou Hamer’s phrase resounds: “Nobody’s free until everybody is free.”

    Still learning,

    Robert

  11. witless chum says

    It’s not magic, but trying to put yourself in the other person’s shoes is always a good idea. And always something all of us need reminding of.

  12. P Smith says

    “Blacks are about twice as likely as whites to wind up in the more onerous and costly form of consumer bankruptcy as they try to dig out from their debts, a new study has found.”

    This is not news. Redlining has been in practice for decades.

    http://en.wikipedia.org/wiki/Redlining

    It’s was always illegal and unethical, but that never stopped banks, insurers and others from doing it.

    .

  13. nm says

    This is way off topic, but would “Reggie and Latisha” be used as stereotypical black names in Canada, the way they are in the US?

  14. Dianne says

    The attorney thinks blacks should work harder to pay for their bad decisions, and if the couple shares hir expectation, that reflects better on the couple’s overall competence and morality.

    Sounds like a reasonable explanation, but why are whites considered less moral if they want to work to pay for their bad decisions?

  15. Dianne says

    And someone who appears to be trying to “pay” for their bad luck is suspect because it’s judged to be an irrational behavior?

  16. says

    Perhaps, or perhaps it is, as I said earlier, simply a reflection of the discrepancy between the expectations of the client and the attorney. I’ll definitely have to delve more closely into this particular part of the analysis, because there’s some important info to be pulled from it.

  17. jamessweet says

    The attorneys surveyed were asked to identify their own race (to see if the race of the attorney played a role).

    So did it?

    One reason I ask is that I think an important part of moving forward on issues like this is getting people to understand that the vast majority of perpetrators of this sort of discrimination are not doing so consciously, are not even what most of us would call “racist”. I think it is far too easy for a perfectly well-intentioned person to hear of a study like this, say “Tsk tsk”, but then think, “But that’s not ME that’s doing that. I treat all people equally regardless of race!” Just because you nominally think people should be treated equally, just because you are trying to treat them equally, does not necessarily mean that you are.

    I would be very surprised if black attorneys were significantly more even-handed in their treatment than white attorneys. Since these biases tend to creep in subconsciously, even having a strong incentive not to perpetuate such biases (as a black attorney most certainly would!) does not make one immune. But maybe my guess is wrong…

  18. says

    The numbers were insufficient to make that kind of determination. If I had to guess, I’d say that black attorneys would be less likely to show this pattern, but it would still exist. That more or less falls in line with other studies of implicit racist attitudes.

  19. Pen says

    Since this seems to be a problem in lots of professions, I would love to see a study of whether attorneys (or whatever) do adjust their behaviour with education.

  20. nm says

    I guess that what I’m wondering about is whether the Canadian descendants of people who fled to Canada from slavery in the US would today have similar naming patterns to USian descendants of people who were slaves in the US. And I recognize that that’s probably not something you can answer definitively, let alone being a massive derailment. I apologize.

  21. Jenora Feuer says

    The fact that the submissions were the same aside from changes in names reminds me of a story I heard back when I was going for my degree in Comp.Eng.

    Basic summary: old, established and high-class University had been dealing with accusations of systemic racism, some of them triggered by exactly this sort of test. In an attempt to prove that they were moving beyond that, the University admissions department set up a computer with a neural net training system, and ran through thousands of old applications (both positive and negative) to train it on what sorts of requirements were expected for admission to the University.

    As part of the test of the new system, someone did the same thing, submitted a borderline case, once with an obviously Anglo-Saxon name, and once with a long obviously ‘foreign’ name, but otherwise exactly the same CV. The computer passed the Anglo-Saxon name, but not the other one. People said the computer could not possibly be racist, despite the results.

    Then it was pointed out that the training information given to the computer had included the names of the people who had been accepted or rejected before… and the computer had picked up on the decades of institutionalized racism in those decisions which had accepted ‘English’ names and rejected otherwise equal CVs with ‘foreign’ names, and as a result it had incorporated that into its decision-making process.

    Needless to say, the computer was re-trained, this time with the name information removed from the training system…

  22. says

    That’s fascinating. Someone in another thread asked what would happen if aliens came down to try and sort out what the ‘races’ were (without being able to see physical features). I guess this is a pretty good way of answering that question.

  23. dianne says

    nm: It’s my understanding that a lot of freed slaves in the US ended up taking their ex-masters’ last names as their own, which is why in the US a lot of blacks have very British sounding names. I have no idea what escaped slaves who made it to Canada did for last names. Anyone know?

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