The house always wins: financializing racialized precarity

After the 2008 financial crisis, we all know about the subprime mortgage bubble. Lenders gave out tons of subprime mortgages, mostly to blacks and Latinos, and then investors made tons of money by betting against these homeowners’ ability to repay their mortgages. This tactic effectively financialized racialized precarity. Betting against these mortgages, white investors and white institutions made a wager on the risk white supremacy subjects blacks and Latinos to. This is a fixed bet, of course: white supremacy guarantees that blacks’ and Latinos’ lives are risky and precarious in very specific ways. Betting against the success of non-whites, white people and institutions profit from white supremacy.


It’s not just bankers and investors who financialize racialized precarity: municipal governments do this to generate revenue. As tax income dwindles, some municipalities have used fines as a significant source of income. As Dan Kopf’s “The Fining of Black America” shows, “the cities most likely to exploit residents for fine revenue are those with the most African Americans.” These cities are doing the same thing credit default swappers did: betting against the success of black people, betting on the riskiness and precarity of living as a black person under white supremacy. Basically, these municipalities are betting that black people will break the law–which is a totally safe bet when, as Lisa Cacho shows, white supremacy treats blackness as what causes behaviors to be interpreted as criminal.


Cheryl Harris explains how whiteness is a kind of property and property interest. But neoliberalism changes how we think about property: it’s not a commodity to be exchanged, but an investment to be intensified by venturing risks and repeaing rewards. These two examples I just discussed show us how white supremacy distributes risk and reward to make sure “the house” always wins. Blackness is the risk that white institutions require to generate profit–both literal cash and whiteness-as-property profit. As Harris argued, institutions like the law and police are designed to protect the property interests in/of whiteness; under neoliberalism they function to insure whiteness and white institutions against the risk necessary for financialized investing.