Roberts, A (2013). Financing Social Reproduction: The Gendered Relations of Debt and Mortgage Finance in Twenty-first-century America According to Adrienne Roberts, what is social reproduction ?
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In US, 2000-2007: Average household income: stagnant
US household debt: doubled to $13.8 trillion
debt to GDP ratio: 98 %
liabilities to disposable income ratio: 138%
Security for debt: residential real estate as > 80% household liabilities
Sharp rise in consumer debt: credit card, auto loans and student
Poor classes debt dramatically grew by 90%
In 1998- 2008, mostly low income and average Americans were given 15 million subprime loans
The Mortgage Interest Deduction (MID) tax benefit:
highly regressive that subsidizes the rich homeowners
private homeownership is promoted as a right in a ownership society
But no democratic measures to equalize the credit and borrowing for the poor
These conditions increase the wealth of the richer borrowers
When the system fails, e.g., mortgage loans not paid back- the poor women and minorities lose all the equity they have built up
Section1: the concept of social reproduction
Section 2: explains how under neoliberalism, the debt in general, and mortgage debt in particular, are the financial system’s re-privatization of social reproduction
Section 3: Shows the connection between finance, social policy and social reproduction
MID tax benefit turned into an indirect subsidization of private homeownership for the wealthiest segments of the population
As a result, the poor borrowers of mortgage loans helped redistribute resources to the wealthy.
Section 4: subprime mortgage loans discriminated against the women, minorities and the poor.
Thus financial markets and operations are not technical but human with prejudices and discriminatory biases.
Market citizenship and social reproduction:
Society assumes that social reproduction of labour will occur without formal recognition of who is involved and how it is performed- no costs or compensation is involved for reproducing labour as if it were automatic
The new concept of ‘market citizenship’ under neoliberalism vs. social citizenship:
Neoliberal market considers individuals as technical without social context of class, gender, etc.
Thus market distributes goods and services for all assuring the well-being of all regardless of differences and divisions within a population
George W. Bush’s ‘Ownership Society’
Thatcher ‘s Ownership Society ( to justify the privatisation of public housing in the 1980s
Bush - twenty-first century justification for eliminating public rental housing when they were turning them into privatized housing
The state/employer was responsible for the costs of public housing – now it was shifted to families and/or the private sector. This is a trend of ‘reprivatisationof social reproduction’
Society assumes that women no longer were dependent on the ‘male-breadwinner’
Now it is assumed that women are a part of single or dual earner family system in society
It does not recognize the inequalities in the labour market sectors where women find jibs or their lack of equal pay in the market.
a dual-earner model is also disadvantageous for women, particularly given that dominant trends are away from full-time, permanent employment
US, UK and Canada:
Prevalence of this trend where policies assume that all are equal regardless of gender, etc.
Ignore the gendered nature of poverty globally: e.g., in Canada, women earn an average of 71 per cent of what men do, pay equity is not enforced in certain sectors.
Fiscal policiesare governed by ‘market citizenship’
Policies are made as technically dealing with issues rather than considering whom they apply to or affect , e.g., reduce government revenues throuhg lower taxes for the rich that reduces the benefits for workers or of women, e.g. child-care while at work.
Debt and the reprivatisation of social reproduction
Cutting of Social support through public housing is opposed to MID for the well-off, subsidizes the wealthy and transfers the assets from the marginalized populations to the well-off.
This trend as redistributed wealth and social power upward, from the poor to the rich, from women to men and from some races to white men and their families.
In 2010, MID subsidization cost govt. $108 billion- this was double the total set up for ($48 billion) the Department of Housing and Urban Development (HUD)
This department was mandated to improve access to affordable housing and to eliminate discrimination in housing markets.
80 % of the benefits from mortgage-interest and property-tax deduc- tions go to the top 20 per cent of taxpayers while 3.5% of the benefits go to the bottom 60% of earners
Mortgage debt was used by the poor and working class to pay off consumer debts: credit card, education loans and health care.
Medical indebtedness is linked to mortgage debt- 60 % ‘medically indebted’ households that refinanced their homes in 2005 used the money to pay credit card loans
More women are bankrupted by health-care costs due to: lower incomes, lack of access to employer-based health insurance, costs of pregnancies, and having dependent children who need health care
In Brooklyn, Mortgage Crisis Eats Away Wealth of Several Generations of Hispanics
Blacks in US face greatest loss of wealth in US history 2008
http://www.youtube.com/watch?v=lcPJ2o6j7i8 7 min
The role of class, gender and race in determining (lack of )access to credit at the market rate of interest
Historically, women, the working poor and radicalized minorities were excluded from access to credit
Under subprime borrowing system: inequitable and predatory loans ($85,000 and $186,000 more in interest than average loans)
Based on assessing them as higher risk borrowers:
People with high credit scores to merit regular rate loans were made to borrow at predatory rates (more than 50% high-interest loans)
In the short term: The result was the social reproduction of the millions of Americans who have lost their homes and savings in the foreclosure crisis .
Long term implication: They will not be able to have social mobility as the foreclosure crisis has precluded the possibility of using home equity to pay for higher education, supplement retirement savings, or to rely on it as a safety net of last resort in cases of illness, job loss.
Even if income and credit risk are equal, African Americans – 34% more likely to get higher-rate and subprime loans than their white counterparts
Subprime lending is 5 times more among African American neighbourhoods than in similar white areas.
Impact of the loss of home equity and rising levels of unsecured debt after the housing collapse- (2005 – 2009)
class- and race-based inequalities in wealth, Increased:
On average, net worth decline:
Hispanic households - fell 66% from $18,359 to $6,325.
Black households: Fell 53%, from $12,124 to $5,677
White households: fell 16 %, from $134,992 to $113,149