Wednesday, June 25, 2008

Link Between Stereotypes And Who Gets Targeted By Criminals

I was only half paying attention to the Today Show yesterday (June 24) when they had a segment entitled Tips to improve your finances with author Stacey Tisdale which promised to reveal five money secrets the pros aren't telling you, and explains how your finances are related to your attitude. What caught my attention was Tisdale's mentioning of the need to understand that bigotry about women being less skilled handling money.

Tisdale (1:47): Social stereotypes really cost women money. Women are balancing the family budgets, they're among the fastest group of new homeowners. But there's still that social stereotype that men have a better understanding of money.

We saw many in the financial services industry literally bank on that. Target women for those higher rate subprime loans even though they tend to have higher credit ratings [couldn't decipher a few words]. Women need to empower themselves with that kind of information before they sit down with a lender.

Social stereotypes don't cost women money. The use of social stereotypes cost women money. The difference between these 2 is huge and that difference is critical information which is needed when evaluating who caused a particular problem. This difference often explains why financial advice given to white men is often insufficient because that advice isn't likely to address the additional issues faced by those who are negatively stereotyped.

Unfair and discriminatory and sometimes fraudulent treatment gets directed at certain groups of people because social stereotypes provide the cover story needed to shift responsibility away from those who are deliberately unfair to those who are negatively stereotyped.

Those who are deliberately and consciously being unfair in their business practices believe they can use stereotypes to blame "dumb people" for making bad decisions when those "dumb people" aren't given the best information or the best options that those with positive stereotypes are given without their needing to be financial detectives.

The "dumb people" in this example is women, but in a later example the "dumb people" are African Americans who were also targeted in the subprime mess with higher interest rates than they qualified for.

Once the victim of fraud or discriminatory practices is given all or most of the blame then prevention becomes the sole responsibility of victims and potential victims. Any lawsuits made by those deliberately harmed can be falsely labeled as frivolous attempts to dodge personal responsibility.

If a lender blocked a qualified loan applicant from getting the type of loan they immediately offered to other similarly qualified loan applicants and that action would have saved that person from having their home go into foreclosure, the lender can falsely claim that they aren't morally, civilly or criminally responsible. Businesses exist to make money so they were just doing their job by finding ways to make more money.

That's only true if you accept that drug dealers are just doing their jobs when they get a non-drug user to become addicted because they make money in the process.

A response which only looks to change the practices of consumers is as backwards as focusing all rape prevention efforts on potential rape victims and then quickly buying the victim-blaming excuses of rapists ("she could have gotten away if she really wanted to.") This also gives us people who will sympathise with those hurt for the bad outcomes (fraud, rape) but who actively deny that there was a criminal involved.

A deliberate fraud directed at women frequently gets defended by saying that women need to learn how to make better financial decisions. That's wrong because the flaw is not in the decision making process, it is in the data provided and the data withheld.

If experts want to help women face widespread financial discrimination and not come out worse financially because of that discrimination, they need to help them learn how to detect and report fraud -- whether the criminal statue recognizes a particular predatory practice as a crime or not.

Women as a whole don't need to get smarter financially when compared to men, they need to be aware of who is trying to rip them off and how that ripping off is accomplished. And if businesses are defrauding customers because of loopholes in the consumer protection laws those laws need to be strengthened. This is more than a matter which hurt individuals who didn't do enough homework before applying for a loan, it hurt our entire economy.

Until we get the causes right, the solutions will never be just right.

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posted by Marcella Chester @ 12:05 AM   0 comments links to this post

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