foreclosure magic

The amazing Kaia Sand teamed up with her husband Jules and acclaimed whistler and magician Mitch Hider last night to perform a piece about foreclosures called “The Magician Who Puffed Up Money that Lost its Puff.” Kaia sat on a stool and read from a large storybook she made, telling the tale of financiers who created tradeable assets out of risky mortgages in order to make lots of cash, “poof” like magic. Mitch punctuated the storytelling with classic kid friendly magic tricks like pulling coins from behind people’s ears and walking an invisible dog.

It was a sweet and funny performance, but also, of course, deadly serious. As Kaia explained, she herself had felt alienated by all the complicated financial talk about foreclosures and had at first dismissed it as not pertaining to her. Then she realized she needed to look closer. One result of her investigation was this latest in a series of “econ salons” she has hosted, attempts to bring to life in a concrete way the vast, seemingly faceless economic forces that shape our lives. In addition to the storytelling and magic, Kaia invited two speakers: homeless activist Ibrahim Mubarak with the group Right 2 Survive and Angela Martin of Economic Fairness Oregon, which helps people who have been targeted by predatory lenders.

This event made crystal clear two things that I hadn’t fully understood before:

1. The financial sector created mortgage-backed securities in order to make lots of cash, but, as Kaia pointed out, they could have been anything it would be possible to speculate on: tulips, tons of coal, maybe water. The fact that they represent shelter for people didn’t really matter to those making money (and that means we need to be vigilant about what else is being “securitized”) and

2. (here’s where it gets really ugly) minority communities were singled out for subprime loans, which were needed to create more mortgage backed securities so that more people could get rich.

The result is that minority communities have suffered disproportionately. Some minority neighborhoods have been devastated by foreclosures, and Angela Martin claims that this spate of foreclosures could represent the greatest loss of wealth ever experienced by the African-American community in the U.S. (That’s pretty staggering if you tally up years of unpaid slave labor as a loss of wealth, but I don’t know if that figure takes slavery into account.)

Here’s an academic paper [pdf] that backs up the racial dimensions of the crisis. and Oprah didn’t talk about the racial aspect on her show back in May, when announced his new foundation and rescued a couple of families from foreclosure (and Oprah chided them about being more responsible with their finances in the future). I haven’t heard much about it in the popular press. The dominant narrative seems to continue to be that some people made really stupid financial decisions. They may have been targeted, and even misled, but ultimately their lust for the American dream was inappropriate, they didn’t deserve it, they reached too far.

That story may make some people feel better (it would never have happened to me), but it’s terribly enervating and isolating. Much more hopeful, and powerful, are the visions Kaia, Ibrahim and Angela laid out last night. They talked about the need to expose the institutionalized racism that underlies this crisis (and many aspects of homelessness in general) and about how much it helps to organize around unfair debt–instead of feeling ashamed and alone, people see that there is power in their numbers.

That’s a lot to learn from a storybook and a magic show. I hope Kaia will take this on the road. It has magic. Good magic.