Plan to close Black homeownership gap on chopping block as Dems trim $3.5T bill

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Racial justice advocates fear President Biden is letting them down again by discarding a plan to give $25,000 to low-income Black people and other minorities to help them buy homes.

The homeownership grants are among $327 billion in housing programs on the chopping block now that Mr. Biden must scale back his $3.5 trillion social welfare and climate change package to satisfy moderate Democratic lawmakers.

“All of this funding is now at risk of being cut,” said House Financial Services Committee Chair Maxine Waters, California Democrat and member of the Congressional Black Caucus.

She described the proposed cuts as another blow to the racial equity agenda.

“Housing is one area where there has been discrimination,” Ms. Waters said. “If we are to correct the wrongs of the past, housing is one way to do it,” she said.

The $10 billion home-buying subsidies program is intended to close a homeownership gap. An Urban Institute analysis has found that 42% of Black families own their own homes compared with 72% of White families.

If the housing program is axed, Black activists and voters would reassess the Democrats’ commitment to their racial justice agenda. Mr. Biden and congressional Democrats have already fallen short on promises for overhauls of policing and election laws.

“We’ll have to ask ourselves how committed we are to addressing racial equity,” said David M. Dworkin, president and CEO of the National Housing Conference, a left-of-center advocacy group.

Also at risk of being cut from the package are proposals to expand Obamacare and offer tuition-free community college. Proponents say those plans would help address racial inequities.

The backtracking on racial justice already has registered. Mr. Biden‘s support among Black voters dropped from 85% in August to 67% in September, according to a Pew Research Center poll.

Rep. Jamaal Bowman of New York has said for months that Black Democrats do not want a repeat of the racial inequities of the New Deal. Some academics on the left have said President Franklin D. Roosevelt’s social policies disproportionately benefited White people because they excluded Blacks from homeownership loans and other programs.

Under Ms. Waters’ $10 billion plan, the federal government would give $20,000 in down-payment assistance to those who would be the first in their families to own a home.

The Urban Institute estimated that 36% of the roughly 4 million families eligible for the aid would be Black, even though Blacks make up 13.4% of the U.S. population.

The proposal would give an additional $5,000 in down-payment assistance to those in “socially disadvantaged groups.”

The idea has been criticized on the right for discriminating against White Americans.

Democrats don’t agree about ways to address the homeownership gap. Senate Finance Committee Chairman Ron Wyden, Oregon Democrat, proposed a $15,000 tax credit to all first-time homebuyers regardless of whether others in their family have owned homes. His plan also would not give extra money to “socially disadvantaged” groups.

Meanwhile, proposals to expand Obamacare and cover dental care through Medicare are also touted as helping minorities. Democrats want to provide government-funded health care to 2 million uninsured people in 12 Republican-led states that chose not to expand Medicaid coverage under Obamacare.

Sixty percent of those who would gain insurance would be people of color, according to a study by the liberal Center on Budget and Policy Priorities.

Forty-seven percent of seniors did not see a dentist in 2018, according to a Kaiser Family Foundation study. The number was larger for minorities, said Dan Adcock, the government relations and policy director for the National Committee to Preserve Social Security and Medicare. Sixty-eight percent of Black seniors and 61% of Hispanic seniors did not get dental care, compared with 43% of older White Americans.

The narrow margins in Congress and a standoff between moderate and liberal Democrats assure that the $3.5 trillion package will be cut.

Proposals to shrink the cost of the package are testing the Democratic Party’s commitment to racial justice, which is vying with the climate change agenda and scores of new benefits for a broader group of low-income and working families.

Moderate Democrats, most notably Sen. Joe Manchin III of West Virginia, oppose spending more than $1.5 trillion.

Mr. Biden has acknowledged he will have to cut the bill to $1.8 trillion to $2.1 trillion.

Rep. Pramila Jayapal, Washington Democrat and chairwoman of the Congressional Progressive Caucus, has proposed saving money by funding all the programs in the package for five years instead of 10 years as originally planned. Others on the left worry that Congress could be in Republican hands when programs such as the Obamacare expansion face expiration.

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