Justice says that out of 4.4 million loans approved between 2004 and 2008, 525,000 went to African-American or Hispanic borrowers, of which some 210,000 paid higher fees or rates than the average paid by similarly situated "non-Hispanic White Borrowers."
It goes without saying large numbers of white borrowers also paid higher than the average of all whites. It also goes without saying large numbers of minorities didn't pay higher rates, though Justice isn't interested in the average of what minorities paid, only that some minorities paid higher than the average of whites.
If this sounds like statistical malpractice, it's apparently habitual. In a rare instance where defendants fought back, two Los Angeles car dealers recently won dismissal of a complaint accusing them of favoring Asian over Hispanic car buyers because 600 of 1,300 "non-Asian" buyers were charged higher loan terms than the average of Asian buyers. Notice that 600 is about half of 1,300. As the dealers noted, Justice's claim amounts to an assertion "half of one group is above average, which means that the other half is below average."
Wednesday, January 11, 2012
Banks Discriminate Against Half Their Customers
From the WSJ, I found this funny. It seems when you are being sued for Politically Correct crimes, the logic they use against you can be absurdly weak, because the evidence is clearly irrelevant:
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Most of liberals' positions if subjected to the sword of logic would fall.
A variation on the sarcastically proposed NYT headline 'World to End, Women and Minorities Hardest Hit'.
What's not funny is that this is the way the government that taxes you is normally behaving. And it has only gotten worse under Obama (who was more or less a shakedown guy early in his career as well).
I thought the Op-Ed was entertaining as well. But, it seems so ludicrous that I was wondering if Jenkins didn't give us all the details. I notice he didn't provide any information about the magnitude of the fee differences in each group. If the std dev. of the minority group's fees was much larger, wouldn't that be important information as well?
No idea if that is the case, it just seemed so crazy that more of these cases aren't litigated by the defendants.
525,000 went to African-American or Hispanic borrowers, of which some 210,000 paid higher fees or rates than the average paid by similarly situated "non-Hispanic White Borrowers."
Wow, it's too bad Countrywide lacks access to basic legal representation.
Is there any evidence that the basis of alleged discrimination is simply that some individuals of one group paid more than the average of another group? Other than a completely objective WSJ Op-Ed that couldn't possible attempt to advance some ideological agenda regardless of the facts?
When AG Holder announced the settlement, he said:
"For example, in 2007, a qualified African American customer in Los Angeles borrowing $200,000 paid an average of roughly $1200 more in fees than a similarly qualified white borrower."
This is a comparison between averages, not a comparison between an individual case and an average. Yet Holman Jenkins writes:
"It also goes without saying large numbers of minorities didn't pay higher rates, though Justice isn't interested in the average of what minorities paid, only that some minorities paid higher than the average of whites."
Yes, it goes without saying. Of course.
The more I think about this blog post, the more I find it funny. It seems that when someone makes an accusation that political correctness is running amok over common sense, the evidence they use can be absurdly weak, because the evidence is clearly irrelevant.
Its like you read my mind! You appear to know so much about this, like you wrote the book in it or something. I think that you could do with some pics to drive the message home a little bit, but other than that, this is great blog. A great read. I will certainly be back.
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