Talking With the Experts: An Interview With Dr. Matthew Kachura

Baltimore Neighborhoods Indicatory Alliance Program Manager Matthew Kachura (Image Source: University of Baltimore)

Today, we Talk To St. Ambrose have posted our second interview of our “Talking with the Experts Series,” and we are honored to host Program Manager for the Baltimore Neighborhood Indicator Alliance-Jacob france Institute, Dr. Matthew Kachura.  As many of you already know, Dr. Kachura is a hugely respected community member and activist on behalf of Baltimore City.  He is likewise a pre-eminent scholar in the areas of housing, community economic and workforce development, and other issues affecting urban communities.  Dr. Kachura recently conducted an innovative study examining the effects of foreclosure on Baltimore’s schoolchildren, which gained much deserved local and national attention, as it remains one of the only empirically-backed projects studying the residual, far-removed affects of the foreclosure crisis.  Dr. Kachura has also conducted influential research on the Baltimore Empowerment Zone, the earned income tax credit, and commuter issues, among many others.

Again, we are honored to host such an important and distinguished scholar and community member.  My interview with Professor Kachura is below.

Harsha Sekar: It was fascinating to read the results of Phase I of your study on the effects of foreclosures on Baltimore’s schoolchildren. For me, one of the study’s most salient implications concerned the interrelationship of social problems.  It appears that public policies that encourage affordable housing will not be effective without the implementation of a broader welfare state, as widespread access to decent housing seemingly cannot materialize without strong neighborhoods, schools, and access to healthcare.  Given the findings of your study, can policymakers effectively curtail the problem of inadequate housing without simultaneously addressing the needs of other, related social institutions?

Matthew Kachura: The short answer is no.  I believe that urban issues, whether it is affordable housing, high unemployment, social ills such as crime, or issues relating to education, are all interconnected and that policies that take into account this interdependency need to be created and implemented.  Trying to address one issue without recognizing that there are a host of other issues related to it will not lead to sustainable or long-term improvement.

HS: Following up on the last question, what are some of the other, less obvious residual effects of foreclosure that you have noticed in your work?

MK: I think a non-obvious issue is exactly what we set out to identify.  Little attention has been paid to the smallest victims of foreclosure – children.  It is not just that children are also victims of foreclosure, but that the increased mobility resulting from foreclosure can have lasting, long-term effects on their social and personal development and educational performance.  These negative impacts might not occur in the year following the foreclosure, but research has shown that missing days of school as a result of having to move can lead to an increased chance of a student dropping out of school, not completing their degree and in the long run earning less income.

HS: Your study also catalogues the disproportionate effect of foreclosures on minorities.  While many commentators have discussed this issue, few academic studies document this phenomenon with empirical data.  How has the foreclosure crisis functioned to reinforce systemic racism?

MK: We found several interesting findings as a result of this analysis, including the largest numbers of students who were affected by foreclosure in Baltimore City were African American.  This was not surprising though since two thirds of the residents of Baltimore City are African American.  There were two other important findings.  First, the share of Hispanic students impacted by foreclosure had been increasing to a point where the share of students impacted by foreclosure was the same as the total percentage of students attending the City public schools.  Second, we believe the share of white students impacted by foreclosure was not accurately counted, potentially being significantly undercounted.  According to American Community Survey data, nearly a quarter of the children in Baltimore City are white but only 8% of children that attend the City public schools are white.  This means that these students are attending other schools – most likely private schools – and were not included in the analysis.  Overall though, the fact that African American residents and their children were affected by foreclosures in such large numbers supports the facts that predatory lending policies and sub-prime loans were targeted to those persons who could least afford to lose their home.  The loss of the home, the primary vehicle to building wealth for many of these families, only perpetuates a vicious cycle of poverty.

HS: At Mayor Rawlings-Blake’s recent Vacants to Values Summit, the market-drive notion of “Code Enforcement” was promulgated a means to reduce blight in the city, which would impose sheriff sales on properties that do not meet the city’s code.  How do you feel about this tactic, and what other policies do you advocate to incentivize property owners to invest in Baltimore’s underserved neighborhoods?

MK: I believe that the Mayor’s plan has merit and there have been a variety of other strategies taken in an effort to reduce blight and to turn vacant housing into occupied housing.  There are issues with using code enforcement including identifying and locating individuals to serve them with the necessary paperwork, issues relating to selling the properties at Sherriff sales, and then trying to turn them into occupied properties.  Many of these properties are so beyond being able to be lived in, they will require significant repairs and persons willing to take the time and expense in making the repairs before anyone can live in the property.

I also believe that there are already a number of policies that are making strides in having residents invest within Baltimore’s neighborhoods.  Among these are live where you work programs, which also encourages employment, Healthy Neighborhoods, and the Neighborhood Stabilization Tax Credit.  I also believe that the City’s use of data and its Housing Typology model supports the use of strategic investment – targeting neighborhoods with the types of interventions that are needed most within those neighborhoods instead of spreading resources too thinly across a variety of neighborhood types.  Most of all, I believe that residents living in Baltimore’s neighborhoods are the best means to encourage other residents to invest and live in Baltimore City.

HS: Much of your scholarly work examines economic development in urban areas.  How have established NGOs like St. Ambrose contributed to economic development and vibrancy in the Baltimore area over the past few decades?  What do you feel is the role of NGOs in stimulating economic activity relative to that of the city government and the private sector?

MK: NGOs are a critical component to the overall continued health, vitality, and improvement to Baltimore City and its neighborhoods.  NGOs have been recognized as an important partner in economic development strategies that cities, such as Baltimore City, rely on for their ability to produce results and make an impact.  With fiscal constraints and the need to provide the same if not improved services for a shrinking residential base, NGOs have become a more important partner that the City has embraced to push economic and workforce development.  NGOs typically can operate without the bureaucracy and red tape that government agencies have in place, making them, in many cases, more effective and efficient in creating job opportunities and in neighborhood vitality.

Housing, White Privilege, and Wealth Inequality

As a social justice issue, housing seems simple and relatively bland: people need shelter, what else is there to talk about?

A lot, actually.

Housing issues are related to a complex web of social justice concerns. Two related concerns that are particularly relevant to housing are white privilege and wealth inequality. In fact,  understanding the history of discrimination in America—particularly housing discrimination—is indispensable to understanding contemporary economic inequality.  What’s the connection between housing,  white privilege, and wealth inequality? Here’s a statistic that might surprise you:

The Federal Housing Administration and the Veterans Administration financed more than $120 billion worth of new housing between 1934 and 1962, but less than 2% of this real estate was available to nonwhite families—and most of that small amount was located in segregated communities.[1]

In other words, for almost three decades the U.S. government backed $120 billion worth of home loans and 98% (!) of those loans went to whites.

How did this institutionalized racism become possible?

Spurred on by massive mortgage foreclosures during the Great Depression, the federal government […] began underwriting mortgages in an effort to enable citizens to become homeowners. But the mortgage program was selectively administered by the Federal Housing Administration (FHA), and urban neighborhoods considered poor risks were redlined—an action that excluded virtually all the black neighborhoods and many neighborhoods with a considerable number of European immigrants. [2]

More important than this shocking history, however, is the relationship between home ownership, wealth, and opportunity—a relationship that links past discrimination to economic inequality today. To begin with, a home is one of the most important assets that a family can own. As Dalton Conley—associate professor in the Department of Sociology at New York University—explains in the PBS documentary Racethe Power of an Illusion, “The majority of Americans hold most of their wealth in the form of home equity.”[3] Therefore, because of the significance of housing as an asset, discrimination in housing directly contributed to inequality in wealth accumulation.

Wealth, in turn, is an important determinate of the opportunities that a family can provide for their children. As Larry Adelman has written, “a family’s net worth is not simply the finish line, it’s also the starting line for the next generation.”[4] A family can take out a second mortgage on their home, for instance, to finance their child’s college education or job search. Actions such as these can significantly affect a child’s life trajectory.  Indeed, because of the way that wealth creates opportunity, “Economists have shown that about 50-80% of our lifetime wealth accumulation is really attributable, in one way or another, to past generations,” writes Conley. Wealth, in other words, provides a mechanism that transfers opportunity, or the absence of opportunity, from one generation to the next. It is this intergenerational link between wealth and opportunity that explains why the effects of long past institutionalized racism—such as FHA housing discrimination—are still felt today.  [*]

How are the effects of historic discrimination still felt? Take the “wealth gap,” for example. Thomas Shapiro, in The Hidden Cost of Being African American, writes that “The net worth of typical white families is $81,000 compared to $8,000 for black families.”[6] That’s a 10:1 difference! This present day racial inequality in wealth, however, must be understood in light of the history of institutionalized racism and privilege. And housing discrimination is a fundamental part of that history. As previously mentioned, a home is often a family’s most important asset or source of wealth. Housing discrimination, therefore, created inequality in the accumulation of wealth. Moreover, wealth has two distinct characteristics: 1) it creates opportunity and 2) is it inheritable. The combination of these characteristics produced a dynamic whereby inequality in wealth—initially bolstered by discriminatory practices—was often passed down and maintained from one generation to the next. So long past discrimination in housing affected the wealth and opportunities of later generations. In short, past housing discrimination is an important factor in explaining economic inequality today. Conley writes:

Today, the average Black family has only one-eighth the net worth or assets of the average white family. That difference has seemingly grown since the 1960s, since the Civil Rights triumphs, and is not explained by other factors like education, earnings rates or savings rates. It is really the legacy of racial inequality from generations past. No other measure captures the legacy – the cumulative disadvantage of race for minorities or cumulative advantage of race for whites – than net worth or wealth.[7]

Thus, the reverberations of long past institutionalized racism are still felt today. As a primary example, housing discrimination creates inequality in wealth and opportunity that is often inherited by succeeding generations. Tracing back the linkages between present day inequalities in wealth and past housing discrimination demonstrates that—as a social justice issue—housing isn’t simple. Yet these linkages also show that, in spite of their complexity, contemporary housing issues remain as important as ever.


[1] George Lipsitz. 1998. The Possessive Investment in Whiteness. Philadelphia:Temple University Press.

[2] William Julius Wilson. (2005 [1996]) “When Work Disappears: The World of the New Urban Poor,” in Mapping the Social Landscape: Readings in Sociology. ed. by Susan Ferguson. New York: McGraw Hill.

[3] Dalton Conley. 2003. Interviewed in Race the Power of an Illusion. PBS Transcript available at http://www.pbs.org/race/000_About/002_04-background-03-03.htm.

[4] Larry Adelman. 2003. A Long History of Racial Preferences – For Whites . http://www.pbs.org/race/000_About/002_04-background-03-02.htm.

[*] Note that wealth, not income, has been the touchstone for economic status throughout this discussion. This is no accident. For wealth, not income, is a much better indicator of opportunity: “Even when families of the same income are compared,” explains Adelman, “white families have more than twice the wealth of Black families. Much of that wealth difference can be attributed to the value of one’s home, and how much one inherited from parents.”

[6] Thomas M. Shapiro. 2004. The Hidden Cost of Being African American: How Wealth Perpetuates Inequality. New York: Oxford University Press.

[7] Dalton Conley. 2003. Interviewed in Race the Power of an Illusion. PBS Transcript available at http://www.pbs.org/race/000_About/002_04-background-03-03.htm.