Thomas Sowell

Statistics played a key role in creating the housing boom and bust that led to the current economic crisis. Back in the 1990s, politicians, the media, community activists like Jesse Jackson and others all made a lot of noise about statistical studies showing that (1) non-whites had lower rates of home-ownership than whites, (2) were turned down for mortgage loans more often than whites, and (3) resorted to more expensive subprime mortgage loans than whites.

All this led to pressures and even quotas for banks to lend to more low-income and minority applicants. That in turn led to lower mortgage lending standards, more risky mortgages, higher default rates and the collapse of financial institutions that bought these more risky mortgages or securities based on them.

We have seen and heard the same kinds of things when statistics about other racial differences have been cited in the same strident voices when other statistics showed blacks laid off more than whites during economic downturns or the children of black women having higher infant mortality rates than the children of white women.

What we have very seldom seen or heard in such parading of statistics are other statistics-- which are readily available-- showing that (1) whites are turned down for mortgage loans more often than Asian Americans, (2) whites resort to subprime loans more often than Asian Americans, (3) whites have been laid off more in a downturn than Asian Americans, and (3) the children of white mothers have higher infant mortality rates than the children of mothers of Filipino or Mexican ancestry, even though these mothers receive less prenatal care than white mothers.

In other words, numbers do not "speak for themselves." Politicians, the media and others speak for them-- very loudly, very cleverly and often very wrongly.


Thomas Sowell

Thomas Sowell is a senior fellow at the Hoover Institute and author of The Housing Boom and Bust.

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