Big banks setting actual loan rates to big businesses based on 'diversity' quotas instead of ability to repay
As if America already didn't have enough of what fascism-savvy Argentines call "the corporate republic," we now learn that big banks are conditioning their credit to big businesses based on "diversity" quotas, not creditworthiness.
According to the Washington Free Beacon:
Amid an uptick in race-conscious hiring programs throughout corporate America, many prominent businesses are now writing racial and gender quotas into their credit agreements with banks, tying the cost of borrowing to the companies' workforce diversity, a Washington Free Beacon analysis found.
The businesses that have struck such agreements include the pharmaceutical giant Pfizer, the consulting groups Ernst & Young and AECOM, insurers Prudential and Definity Financial, private equity firms BlackRock and the Carlyle Group, the technology company Trimble, and the telecommunications giant Telefónica.
Over the past two years, each of those companies has secured a lending agreement, known as a credit facility, that links the interest rate charged by banks to the company's internal diversity targets, creating a financial incentive to meet them. If the business achieves its targets, it won't have to pay as much interest on the loans it takes out; if it falls short, it is required to pay more.
That's got to be an illegal practice, given that lending money on the basis of skin color, rather than a borrower's capacity to repay, is nothing but naked racial discrimination.
To start, how the heck do they determine how well these quotas are filled? Do they do a blood test on every employee, or use percentages, such as x many drops of Race A blood and x many drops of Race B blood, the way the old Brazilian bureaucrats who kept track of such things once did, so as to make their interest rate determinations? Do they give some hires double-credit or half-credit for having two or more races in their ancestry? What about people who aren't sure what their entire ancestry is? Do they hire the Mormons (who are famously great genealogists) to get that determined for the sake of the corporate credit score? How many Fake Indians turn up in skin counts like these? How many incompetents get hired because they check the right skin color box instead of having the right qualifications? How many corners are cut? How many foreigners over Americans get hired based on skin color? How many no-show jobs are created for such purposes? This sounds like an Evelyn Waugh novel now...how many qualified applicants get turned away for having the "wrong" skin color, based on their likelihood of raising the company's borrowing costs?
You know these determinations are loaded with riggings, inaccuracies, corruption, and cruelty.
But that's what corporations are consenting to, and that's the terms big banks — Bank of America, BlackRock, Wells Fargo were the three that were named — are insisting on.
It's as bad a means of allocating capital as openly redlining neighborhoods, another big bank heritage specialty, or shutting down the accounts of political dissidents, which has been seen elsewhere taking a foothold in the banking world.
Banks are highly regulated entities in heavy hock to the government, so it's likely that in addition to hiring a lot of money-greedy wokesters to cook up such policies, they also take their direction from the Biden administration in this terrible misallocation of capital, which not only harms the banks' bottom lines, but also harms the companies' bottom lines and with them, the entire global competitiveness of the U.S. economy. The best man for the job may not be the best man for the job, given that skin color is now trumping talent and capacity. Hire one too many white guys? Pay up — it's like the government giving you a fine.
And it takes an expensive and expanding "diversity" bureaucracy to create that entire failure of competitiveness and fairness.
What if every bank did this, and what if every wokester corporate consented to it? What would they do with all the excess white men with higher education, who are the likeliest victims in this travesty of bean-counting over free markets? Do they put them to work digging ditches? The idea behind this crude one-size-fits-all scheme is to make racial quotas mirror exactly the population, even though the population has uneven levels of development, thanks largely to the failing public schools controlled by the teachers' unions. Instead of fix that by getting rid of the substandard unions who flunk at their jobs educating all sections of the population, they try to make the job market, which is the culmination of the educational system, fit the mold, instead of the union-controlled schools and communities. It's why corporations cannot find enough black engineers and computer scientists in the real world, which creates some curious hiring practices.
The only criterion the big banks should be using is a client's capacity to repay. The most creditworthy borrowers should get the lowest rates, and the riskiest borrowers should get the highest rates. What skin color has to do with capacity to repay is zero, zilch, nada. To employ these practices is pure corporate state activity, the revolting marriage of the state and big companies, which is otherwise known as "fascism." It's an invitation to mediocrity and corruption, such as you can find in Brazil or Argentina or any fascist state, and up until recently has had no place in a free society.
The incoming GOP Congress should crack down on this blatantly illegal activity before it gets any bigger, eventually becoming part of the social credit scoring such as is seen in China, and other nightmare regimes, that will take America downhill.