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Get ready to experience Baltimore.

The Flippers.

Y'all ready to come see this bathroom upstairs?

That door right there. Dude take your shoes off.

Uncle Yank right there. -Uncle Yank right there, yeah.

That's Uncle Yank.

One, two, three, four bedrooms.

Bathroom in here, this is the one.

This is the one.

Come check the shower out. Check the shower out.

All granite. Huge, sexy.

This is a sexy shower.

Me, a woman, her friend.

Whatever you into.

You know!

Baltimore.

The... The Flippers.

Dan is gonna create... -I'll put a puddle there.

He's gon' create a puddle in the middle of the concrete.

Money should have just flow. -Nah...

Man off... -Yeah, if you're asking me,

I prefer my shit just full straight out.

Go straight out. -Ain't nothin' heavy

coming back here, though.

It ain't ever heavy, but my whole thing is puddling.

Home ownership to me, it means freedom, strictly.

It is a...

The more and more I evaluate this world,

the more and more I understand that

when you don't own anything, you are nothing, you know?

Something happens in this world, catastrophic.

You gotta have a place that you can go to, and say this is mine.

No matter what's going on, I own this.

And it means so much to me, it means everything to me.

If I'm by myself, I tend to savor it.

So peaceful.

Getting out of the bed, walking around in my underwear.

Going into the refrigerator, get then some apple juice or somethin'

and go out on to the porch and smokin' a cigarette.

You always find a reason to snap out of it.

'Cause like, you can only daydream so long.

It's not fun when you leave and go home

and you back to where they call the trenches.

From the '30s onward, every single president

has spoken of home ownership almost

as the basis of citizenship.

Your ability to own a home kind of makes you a citizen.

The most tangible cornerstone

that lies at the heart of the American Dream,

and that's the chance to own your own home.

For those of us who've been given positions

of responsibility must, must do everything we can

to spotlight the dream and to make sure

the dream shines in all neighborhoods.

All across the country

I say to millions of young working couples,

by the time your children are ready to start the first grade,

we want you to be able to own your own home.

Because in order to be secure in their human rights,

people need access to property rights.

We must make sure that every family in America

lives in a home of dignity.

A neighborhood of pride is the community of opportunity

and a city of promise and hope.

Hi, I'm Jim, The Realtor. Here's some tips for home buyers.

Number one, work with a great realtor.

A good realtor sells at least one house a month.

Check their sales history on Zillow.

Americans love buying homes.

In Southern California especially, we dig real estate.

And we forgot about the bubble and all the other trouble,

the financing and everything else.

And here we are right back at it, frenzied up,

five, ten, fifteen buyers for every house, like none of that ever happened.

Here we are on the 800th video.

I document the real estate market on YouTube.

I got almost 1500 YouTubes now,

and it gives people a real good sense of what's happening.

I'm in Chula Vista today.

That house sold for 1.6, 1.1,

I'm talking millions here.

1.4.

585.

I don't know what to say either.

Let's go take a look.

What! I don't what the heck that is, a doll house.

Pool in the front yard.

Slightly unfinished fire pit.

Why are you stealing the trim piece out? You got me.

All the other appliances all stolen.

What could have been so nice about those pillars

that they had to steal those? I'm not sure about that.

There's 15 houses on this street.

I think it was at least eight of them had loans way over a million.

Well, if you're sitting on a 1.2 or 1.4 loan,

and you see houses listed for 585,

how's that gonna make you feel about making that next payment?

I'm Jim, The Realtor.

So what we saw in 2008 was the unwinding of the housing finance system.

What most people understand as a financial crisis,

or a problem of our housing stock,

actually is the unwinding of a social contract

that was built in the 1940s.

And so understanding that, and how the American home

was the basis of how we organize the economy,

and how we organize social stability,

is an important part of understanding why we are where we are now.

It's still pretty nice neighborhood here.

How you doin'?

Do you know if any of these places here used to be

an old firehouse many years ago? -Uh...

Is a somewhat active firehouse? -Yeah.

Oh no, this was an old, old firehouse.

Years ago it shut down.

Hi. -Hi. I'm sorry to bother you.

I, I want... -Did you ring the bell?

I did. -Which one, the yoga or the attorney?

Well no, I was born here many years ago,

and there used to be an old firehouse around here someplace,

would you know where it would've been?

Might have been here, that was converted, or there.

That used to be a tiny, tiny firehouse.

But let me just check up a little bit further.

My mother punched a nun right in the face over there.

When I was six months old, we moved from Little Italy

in Manhattan to this area right here,

it was a housing project.

One night, my Uncle Frank

was over with his wife and a mob of guys...

...came down this path,

all Italian guys, with bats...

...and belts and sticks.

They were on their way to fight a bunch of black guys.

And they walked past us

and my Uncle Frank said to my father,

"Get this kid, get him out of this neighborhood and move."

And it was not that long after that that we moved to Levittown.

I still say you're making a big mistake, Tony!

How could you leave New York, huh?

The Triborough Bridge.

Hey look, Mrs. Rossini, you gotta admit this neighborhood is falling apart.

How you gonna support yourself, huh?

Oh hey, Mrs. Rossini, I got a great job and a great place.

It's all green with picket fences.

* There's an open road And a road that's hidden *

* A brand new life Around the bend *

* There's a path you take And a path not taken *

* The choice Is up to you, my friend *

-* Not so long * -Aw!

* But you might awaken *

* To a brand new life *

* Brand new life, a brand New life around the bend *

Goodbye.

Holy shit.

Wow.

How much you want for that? -38.

-$3800? -Yeah, right.

That... That's a deal. -Okay.

Levittown is not a rich neighborhood as you can see,

but what I love about this town is, it's a blue-collar town.

It is what I consider to be the backbone of America.

When America fights its wars, it's people like us who go.

Levittown was the first community of its kind that was built like this in the nation.

Nobo... everybody thought it was gonna fail,

because he built 10.000 houses like that.

Coming out of the second World War,

the idea of mass production became something

that was truly a reality.

Hey kids, look,

a whole new world to build.

The idea that came to a man named Bill Levitt was this,

why not mass-produce the elements that go to make up a house

just as the auto industry does with the parts that go into a new car?

When I was living there, it was at a very particular moment,

and that was coming out of post-war trajectory

that created the need for that type of housing.

If you were a returning G.I.,

you could buy a house...

...for as little as $100 down and about $99 a month.

And that was partly because the federal government

was insuring your mortgage.

We had the G.I. Bill encouraging construction of new homes

so the whole idea is, your government wants you to have a home.

So this was an easy way to sort of jump start

the housing industry and make home ownership possible.

Without those subsidies,

lower-middle class families

would never have been able to afford

the massive movement into the suburbs that we saw

in the late 1940s, 1950s and early 1960s.

I was a police officer here in Nassau County,

and we were, uh, the SWAT Team as well.

Here's the school I went to.

And you know the story about sticking your tongue

on the flag pole in the middle of the winter?

Yes sir. -I did that right there,

right on that flag pole.

I swear to god I did.

If you couldn't afford to put a down payment on these homes,

Levitt would let you rent them with the option to buy,

so he was just terrific.

Ladies and gentlemen, this is William Levitt,

who heads the largest home-building firm in the world.

Bill, all this must have taken an awful lot of doing.

We had to start from scratch with absolutely nothing,

and everything had to be done at once.

If you go back to William Levitt, he said,

"No man who owns his own home and lock

can be a communist, because he has too much to do."

This was a fundamental part of how our political leadership

and our country at large understood the bargain.

You get a home, right, I mean, you have to work,

there are 30-year jobs that go along with it that match the 30-year mortgage.

And then you don't rebel, right, that's the thing,

you don't revolt if you have a stake in the system.

CBS News now presents

a special report on one of the most unusual

diplomatic events in recent history.

So the Kitchen Debate served one of the most famous moments

in the history of post-war housing.

That's basically Nixon saying to Khrushchev

that the strength of the American economy is the post-war home

and the ability of Americans to purchase consumer-durables to fill it.

So let's compete.

The system that will give the people more goods will be the better system.

In this one particular moment, Nixon was right.

This was the strength of the American economy.

I can remember, even as a kid, looking at house magazines

and seeing these incredible visions of the future.

The house represented in those pages

was something that you could aspire to,

and that was starting to become a reality.

What a dream.

Imagine how wonderful it would be to live in a house like this.

Just imagine.

The future becomes the present in House of The Future.

The house of 1999 will be virtually maintenance-free.

Yes, life will be richer, easier, healthy

as space-age dreams come true.

And now we channel our tuning, it tracks the color more automatically than ever.

See the talking alarm clock.

Enjoy the classic beauty of these rugs

for a fraction of the cost.

But I'll confess, I like the conveniences as well.

Wouldn't you like to trade in your old kitchen? -For one like this?

MasterCard gives me what I want,

and anything is possible.

Hello?

Hey buddy, give me like 45 minutes.

Okay. -Alright, buddy boy?

Alright. Alright.

The only thing that Levitt did that was wrong...

Wow, look at that.

The only thing that Levitt did that was wrong,

and I'll be the first one to admit this,

"No blacks allowed."

"No blacks allowed."

And that is disgraceful.

If I'm fighting alongside a black man

who's willing to die for his country...

...and he can't buy a house next to me in Levittown?

I'm sorry man, that don't make any sense to me.

Why did you select Levittown to live?

We were looking for a place to buy a home.

We looked at Levittown, we liked the homes here,

we liked the advantages that Levittown seemed to offer

and, uh, in comparison to other cities.

And we understood that it was going to be all white,

and we were very happy to buy a home here.

When you come to this neighborhood,

you know immediately, it's different.

They're all drawn together.

There's no real fences.

It gives you a feeling of a park-like setting.

I was struck by how familiar it felt.

It was a connection to Levittown

that they both developed as post-war suburbs.

I believe Gregory Ain,

when he built these houses, he really built these houses

for the veterans coming home from the war.

It was hard for him to get financing for these houses, because they were so different.

The whole social part was part of his design,

and, um, probably also, I shouldn't even say that,

so don't, I'm not even going to open...

Aw, I wanna hear it. -He was a socialist,

and I think a lot of the people that moved in here were...

I'm gonna get in trouble for this.

My father is Gregory Ain, a fairly well-known

California architect from the '40s and '50s.

So these are the letters.

It does say, "I just came into my hotel room

from an interesting and unexpected visit

through the basement drafting rooms at Yale.

The one and a half days at Phillip Johnson's dual new canon,

he is a real fascist intellectual."

I started rummaging through some old papers and then I came across this,

you know, 200 page or 100, yeah, 200 page file

that the FBI kept on him and they were watching

everything he did from the mid-'40s to the mid-'50s.

Gregory believed that decent housing should be

the right of everyone, not just the privileged and very wealthy people.

Archie.

Twelve per cent of the population is black,

there should be a lot of black families living out here.

Yeah, this is only a beginning but I think it's wonderful.

Well, let's see how wonderful it is

when the watermelon rinds come flying out the window.

Oh that... oh.

Too many notes.

The neighborhood was supposed to be, uh, twice as large.

The plans was for 100 homes and only 52 were built.

The FHA at the time didn't think that

integrated neighborhoods would be attractive to the general public.

And they're providing mortgage insurance, and in their minds,

that would bring down the value of the homes.

You know, most people in America, the value of those homes,

and parents passing that on to their children,

that's made the biggest difference.

African-Americans were left out of that.

That inability to participate

in what created American middle-class,

um, has a lot to do with the problems we have now.

It would be really interesting to dial it back,

and think about the longer, deeper history

of what housings meant in the United States.

Not just that old question of the American Dream,

but the bigger question of who the dream has been for.

* It's a good feeling *

* To live in Baltimore *

* There's something Magic in the air *

* Just waiting here for you *

* It's a good feeling *

* Baltimore *

* It's a good feeling to know *

* It's a good feeling *

* Baltimore *

* It's a good feeling to know *

* It's a good, good Feeling to know *

Baltimore is the beautiful little city

with a lot of bad habits.

The houses here are beautiful, but what goes on outside the house...

It's tough, it's tough.

As a kid, I didn't really understand how segregated

the city was 'cause I never left my areas.

One time, my dad sending me to my godfather's house for a week.

It was like Liberty right outside the city

and he had a nice apartment complex.

We went in the pool every day, we were grilling.

People had decent cars, it wasn't loud at night,

it was fun, but when I got back to the city, we got evicted.

My dad sent us somewhere for the week

just to get the house together.

I've moved too many times to count.

I've lived in so many neighborhoods.

It doesn't allow you to gauge what is normal.

This neighborhood still pretty much look the same.

A lot of these houses are vacant.

We used to go all behind them

and climb up in 'em.

Almost like a treasure hunt.

You'd go in there and find everything

that the people have left before they got evicted.

Uh...

You know, a jackpot,

you a would find some pornos or something like that.

Ooh! -Whoa.

The community didn't feel as empty as it does now

when you see all these vacancies.

When we was kids it was just about having fun.

Baltimore is a microcosm of many urban areas in America

and it is, like Dickens would say, the tale of two cities.

You have great investments in certain parts of town

and other investments looking like a ghost town.

Baltimore, in many ways, is the ground zero

for racial apartheid in America.

It's where racial zoning was invented in 1910

and then racially restrictive covenants were also created here.

We have a myth in this country that, uh,

the reason neighborhoods are segregated is

because people like to live with one another

who are of the race or because African-Americans have

too little income to move into white neighborhoods,

or because this private prejudice that prevents

African-Americans from buying homes in white neighborhoods.

And that's all true, but it's a tiny, tiny part of the truth.

There's intentionality with the Capitol decisions

that were made around housing in the '40s and in the '50s,

and I think people are lulled to sleep thinking

that certain things happen by default rather than by design.

You have the FHA and the VA,

the Federal Housing Administration

and Veteran's Administration.

They subsidize home-building in suburbs

and then they say it's racially exclusive.

It means white people can move out to these areas

but black people can't.

What is probably a surprise to a lot of people

is that redlining is created by the federal government.

Michael, what's redlining?

That's when the white bankers draw red lines

around black areas and don't give up no green.

And the government has to determine which zones is it going to insure

and which zones is it not going to insure, and it does that based on

the racial makeup of neighborhoods.

Neighborhoods that had a certain number

of black residents would have literally red lines

drawn around them on the map,

and they wouldn't insure mortgages in those areas

because they believed that the properties would not hold value.

The bank turned down our loan.

They said I'm a bad risk.

Why would they say that?

Banks take up that same practice.

They decide they're not going to lend in those areas.

That meant that all these benefits

that were flowing to potential home owners

were flowing to whites and not flowing to minorities.

It baked this element of racism into

our home ownership culture.

It ain't their problem, it's our problem!

These people are stepping up in life and we're moving down.

How much you think our property's gonna be worth with them living two doors away?

So we passed the law in 1968, the Fair Housing Act.

It proclaims that fair housing for all, all human beings,

is now a part of the American way of life.

The mandate that the government has given to not just prevent discrimination,

but to actually affirmatively go out and say how do we desegregate America,

except the government betrays that policy.

I find as I travel across the country

that, uh, whether we're talking about white Americans

or people who may be, not Negro,

but in other minority groups like the Mexican-Americans,

the rest, uh, just like the black Americans,

what everybody wants is an equal chance to have a piece of the action.

But the federal government has never enforced the Fair Housing Act

and that State and local governments do not enforce the Fair Housing Act.

And so, again, you know, you could have federal policy

but it's the local administration of these policies

that often meant that black people received discriminatory treatment.

Hello, my name is Tyrone Washington, I'm calling about

the apartment on Park Street. -It's not available.

Yes, hello, my name is Graham Wellington, I'm calling about the apartment

for rent on Park Street, is that still available?

Yes it is. -Oh it is?

Yes. -Really?

And so what does this mean? It means

that the places that were segregated

in the '30s, '40s and '50s, they're still racially segregated today,

because we haven't done anything to undo the racial segregation.

Uh yeah, Levittown today is over 95% white.

Very few minority families living there.

We didn't fix the damage that was done,

we just allowed all those inequalities to continue

but said from this day forward, we can't discriminate.

So it didn't fix it.

All of these policies and practices,

these systems that federal government, state government

and local government pass and enact,

they converge to sort of create concentrated poverty

by the time we reached the '50s and '60s.

So that creates a situation where in many urban areas,

you had like, what George Clinton would call,

you know, chocolate cities in the vanilla suburbs.

Oh, what's happening CC? They still call it the White House,

but that's a temporary condition.

There's a lot of chocolate cities that are around.

We've got Newark, we've got Gary,

somebody told me we got L.A.

And we're working on Atlanta.

Hey, uh, we didn't get our 40 acres and a mule.

But we did get you, CC...

I am trying to tell you that I know now

there is no program or promise that a president can make.

Thank you. -That the federal government can then come in...

...and wave a wand and do this. Yes.

There is legislation in congress.

The condition of black veterans and white veterans

diverged even though, when they returned from the war,

they were economically similar families.

Public housing then became a black phenomenon.

The people who fall into this category,

they have to live where society is pushed them to live.

It... it's depressing just not to have

any kind of nature. Just, uh

tearing down things and people constantly tell you,

"You're the cause of this."

Cities didn't adequately service neighborhoods

that were heavily concentrated with African-Americans.

Garbage collection wasn't picked up as frequently,

streets weren't repaired as well,

and conditions deteriorated then urban areas became slums.

Yeah, I would like to rub America's nose

in this and say take a look at it.

You wanna reject it, go ahead.

But I certainly would hate to think that anybody

thought I'd said they were giving up hope.

What I'm really saying is that society has failed

the hope of the people who live here and struggle here.

That's what I'm really saying,

they're gonna go on struggling anyway

whether we fail or succeed.

But at the same time you have concentration,

you also have clearance, you have highway construction

which is destroying black communities.

Highways, often time in urban areas

are built dead in the middle of black communities

so there's a sort of rising anger

and frustration that takes place.

Once they became slums, authorities looked at them

and said, well, we need to do some slum clearance.

These subsidized homes!

We can't afford no other homes!

What the heck.

Where are all those black people,

all those little kids, where are they going?

When they're uprooting their neighborhood,

they're messing with our unity.

It takes ten years to re-root yourself.

They know what they're doing, this is systematic genocide. Systematic.

Well those African-American families who were displaced, uh, had to move somewhere.

So those families were given Section 8 Housing Vouchers.

The idea behind Section 8 is fabulous.

It's exactly what one would hope is

that people who are impoverished have an opportunity

to move into neighborhoods that are not impoverished.

Unfortunately for black Americans, it doesn't work that way.

A large reason for that is is you can still legally

discriminate against someone for using a Section 8 Voucher.

So landlords in most suburbs would not accept Section 8 Housing Vouchers.

And that's perfectly legal.

White home owners, deathly afraid

of a black person moving next to them

because blackness is associated with lower home values.

We feel your presence in the neighborhood

can undermine the value of our homes, and we're concerned.

We'd like you to move out before it becomes common knowledge

that there's a Negro family in the area.

It's nothing personal. -Oh, it never is.

If it was personal, well, I'd feel real bad.

We grew up in Philadelphia actually, originally,

and we were in an all-black neighborhood

and my life changed when we moved to South Jersey,

not far from some of the Levittown type of neighborhoods.

And when we came in, the police had to come in with us

because people were, uh, throwing things at our house

and terrorizing our house at night.

We moved there because we wanted a place that was integrated

and we just wanted to raise our standard of living,

and it was the strength of my parents that said, "This is where we're going to be".

Do you think a Negro family moving here

will affect the community as a whole?

Definitely. -In what way?

I think that, well, the property values

will immediately go down if they're allowed

to move in here in any number.

Do you think the Meyers staying in Levittown

will affect property values?

Uh, I don't think that the Meyers have anything to do with the, uh,

the property decreasing or increasing.

I think it's purely a white problem, not a Negro problem.

Well, as a result of all these policies,

we created a segregated system.

And because we've forgotten now this entire history

of how it happened, white families believe

that they got where they are simply by their own hard work

and determination to succeed in the middle-class life.

What they don't understand is that their parents

could have come as an immigrant from a white country

and immediately had access to loans

and the ability to move in to white neighborhoods

that black Americans whose families had

been citizens for generations could not.

And so, it's not saying that their families didn't work hard,

but it is saying that their families benefited

from a great deal of affirmative action to get where they are.

White Americans don't see what it's like to live in these communities.

And so, because of that, they're unable to connect

with what it is like to be in these areas

that have been deprived of every type of opportunity.

Now, how do these communities get seen?

They go for decades in these festering situations.

They are segregated communities that have been completely abandoned.

And suddenly we see them only when they burn something up.

This is a world of hurt people

crushed by conditions that they don't understand,

and the rest of America doesn't even want to admit they exist.

Can you make it out, what it is? -Uh, I can't Al.

Smoke just billowing out of that entrance to the CVS.

What can you say about having all this murdering and... and co... confusion?

They're poking holes with a knife.

This is a city that is out of control.

It happened for reasons we had not been willing to recognize.

And it is this riot we must understand

if we are to do something about the dangers that face us now.

It shouldn't be that hard to understand

why that becomes kind of the ultimate outcry.

Because it's the only way that these communities

becomes visible to most Americans.

I don't want anything big, big, big, big.

You wanna get a meatball hero? -I think so.

Where is it? -Not on here, but you said you can get 'em.

What are you gonna do, Johnny?

I'm gonna get a meatball platter, that's what. No bread.

I'm gonna get a meatball platter.

Yeah. -Why?

I love meatballs. -So do I.

Just a platter of meatballs, meatballs,

and, and he wants a hero. -Hero?

Meatball hero. -Yeah, put parmigiana on it too, okay?

Okay, one platter with meatball, only meatball.

Yeah, only meatball. -Yeah, platter of meatball,

platter of meatball. -Yes.

Well, in 1956 when I came out here, there were farms.

I was five years old when I came here in 1949.

I came from the South Bronx.

My father foresaw the future in that area and he says,

"Let's get the hell out of here." And we did.

He had a very outstanding career

with the police department.

They took him out of the South Bronx

for the benefit of the community.

When I first became a policeman, I was in the riot squad.

And any riot or any type of demonstration

there was in the city, I went to it.

Mostly Irish cops on the job then. And they were nasty.

They'd tell you to move and you didn't move, you got the stick. -I mean...

There was law and you didn't... you didn't disobey it.

Protest all you want,

people fought for your right to protest,

but you see guys

putting holes in hoses so they can't put out fires,

not just to businesses, but to people's homes.

Now, you have a right to protest,

but you don't have a right to do that.

Are you sick and tired of where you are,

working hard for years for nothing?

Do you have the guts to step out of where you are

to achieve your financial freedom?

It's pretty easy to do

if you just follow my system, step by step.

It's so easy to make money in real estate

and I'm planning to be a millionaire by age 25.

Look, I just got my first deal, and I'm gonna do

many more like this for millions of dollars.

Make seven deals in 30 days, make $15.000.

a check to prove it, one, two, three, four, five...

You can do it too, what are you waiting for?

I own that one, that one and this one right over here.

Now's the time to buy a home.

Eh, Adam. -Yeah, Halloween.

Trick or treat would be Halloween.

No, Halloween...

Be good for mom.

I will. -Can you be good for mom?

Okay, I'll be good for mom.

Seriously, try to be a little less crazy.

He has a Masters in Urban and Regional Planning

from the University of Minnesota's Humphrey Institute.

Please give them Chuck...

Thank you. -...a warm welcome.

Thank you. Um...

A little bit about our organization Strong Towns.

Our organization has now evolved into a national movement

of people trying to reconfigure their communities,

uh, to be more financially sound.

Post World War Il America, the financing mechanisms of it

act very much like a Ponzi scheme.

You have this immediate sugar high

with this long-term liability kind of hanging out

there in the future, and the last generation standing

is the one that's gonna have to pick up the bill.

We preyed on our fellow Americans

just so we could keep the growth going.

And nobody stopped to consider the impact

that this was gonna have on real people and real families.

I was bird dogging,

finding foreclosures for other investors.

I just saw that the majority of the wealth

created in the United States was through real estate.

So, I was determined to follow that track.

It was so much fun, at the height of when we were making money,

the company had season tickets to the Lakers

right behind the Lakers bench.

So Kobe Bryant's wife,

Leonardo DiCaprio, literally right in front of us,

and when he used to date Gisele and my son, I'll never forget,

he's 15 years old, Gisele's sitting right in front of him.

Gisele's hair is hanging over the back of her seat

and Jeff goes, "Dad", and I go, "What?"

And he goes, and he starts playing with Gisele's hair.

So I'm, oh my god.

Anyway, I tell you right, it was just a bit... But, uh...

Back in '96, '97, there's a new product

that started to flood the market

called a 125% loan to value.

And when I first started seeing that, I said,

"This is a recipe for disaster."

Are you a home owner with too many bills,

too many high interest monthly payments?

Why not pay them off with a second mortgage...

They'll lend you up to 125% of the value of your home,

less your first mortgage balance.

They went after the payment buyer, that's what they did.

"Hey, get a $50.000 second for 500 bucks a month.

Go buy that boat, go buy that second car."

It wasn't a home improvement loan.

It was a signature loan that you could do whatever you want with.

I just thought it was an exceedingly irresponsible

loan product, but I took advantage of it.

Tiki, come here Tiki.

Come on, come on, good girl.

Mikey, Mikey, come here, Mikey.

Hey, hey, Cinnabons, no, no!

The lenders got greedy and they figured,

okay, we exhausted the 125 potential pool,

let's go make it super easy to get purchase money now.

If you were to ask me what the perfect credentials are

to qualify for a home loan, I honestly couldn't tell you.

May I help you sir?

Need a quick answer on a new home loan?

Oh yeah.

Stated income, stated employment,

stated, stated, stated, which means,

whatever the borrower says, is factual.

As recently as 1997, you had to put 20% down

and you had to struggle to save that kind of money.

You fast forward five years, and a bus boy

from a local coffee shop can buy the same house for nothing.

We'll have to verify your credit so

how about a list of creditors?

We don't have any.

If we can't pay cash, we do without.

Shh, shh, shh.

What are you saying?

That could ruin the entire American economy.

I mean, where would this country be if we didn't all owe

more than we could pay back?

In order for the house of cards to stay standing,

it has to get bigger.

So the guy that's in the three bedroom, one and a half bath house,

he's gotta move up to the four bedroom, two bath house.

The house of cards just kept getting bigger

and bigger and bigger and bigger,

and bigger and bigger and bigger.

And it's just all on fake valuations.

Yeah, at that point, the home did absolutely

become a vehicle for excess.

Home prices rising, it's from the Case-Shiller Index.

I look at the number, and I say, yes this looks good,

it's much better than expected. You look at the number and say...

Nobody knows what home prices are gonna do.

People are increasingly speculative.

When they buy a house, a major concern is

how much can I sell this to someone else at the other end.

It can be called, "the greater fool theory."

Maybe I'm a fool to buy such a big house,

but I'm gonna sell it to an even greater fool.

There were people who thought 50 or 100 years ago

that home prices should decline with time,

and the reason is, they wear out.

Don't expect it to gain value, expect it to lose value.

That was a common view in the past.

For so long we have come as a society

to place a tremendous amount of value on the home itself.

And the bigger the home, the better.

It's interesting because Levittown

and the houses were meant to evolve and change

as families evolved and changed over time.

The idea was that this home would be livable all your life.

You could have one bedroom or three bedrooms,

depending on what your needs were at the time.

And, um, this area was, could be an extension of the living room,

or it could be closed off and become a bedroom.

Sorry.

So you close it here.

You wanna go outside so you can talk? -Yeah, yeah.

You'd close it here.

And then you would enter from the hallway.

So I have, I'm coming out from the bedroom hallway now

where all the entrances are to the bedrooms.

So it could be either one bedroom or three bedrooms.

Right now, we created one bedroom here

and in the rear there's one bedroom

that could be partitioned with a rolling wall

so it would become two bedrooms.

That was an extension of the dynamic coming out

of post-war idea of what the house provided.

Wasn't really about the upscaling

or the supersizing of the house.

And so that relationship between the growth

of the physical house was still somehow in balance.

Subsequently, people began to make the scale shift,

where the houses became just large.

I'm in love with this indoor tree.

I hope it ain't a ficus.

I don't think it is.

So this is where your dining room would be.

That's a lot of alcohol.

It's a maze, 5000 square feet.

Only one staircase, it kind of feels like

that back staircase or something.

I feel like it's very track home-ish.

So the attached office, I can see that set up.

That is really more suited for Grandma.

She doesn't really wanna have a detached unit.

I don't think Grandma needs 12-foot ceilings though.

The McMansions, they're going the way of the dodo bird.

People wanna buy what they need

and they don't want any extra.

And this has so much square-footage and wasted space.

They might get away with one more sale,

but in the years to come,

it's gonna be tougher and tougher.

Connor, was that fun? -Yeah.

There's just tremendous economic dependence

on this idea that we can keep building

new single family homes in their own lots.

And that they have to keep marching across the US landscape

because it's a huge part of what the economy depends on, for its health and wellbeing.

Dolce, come here.

Yes, so our property line

is just basically the white picket fence all the way around,

all the way back up to there.

So we're gonna have our garden over here,

and a chicken coop over there.

Gigi's a grand champion.

Uh, not so much Dolce.

So this whole industry of easy,

quick money for property did not end at the retail borrower.

The developers were exposed to these funds.

So these companies were going in and buying up

swaths of land from these farmers at ridiculous prices.

Just giving them enough money

for their great-grandchildren to retire on.

And it, it was just so hard to say no.

And that's where you see all of these citrus farms in the Inland Empire gone.

And of course, the cities were loving it,

because the tax basis on real property

with a house on it is far higher than farmland.

The cities were seeing their tax base quintuple,

literally overnight.

And then the developments stopped.

The United States economy has never been in better shape.

We have created the highest standard of living

for a country of our size.

* I never knew *

* How to say *

* No to you *

It's a terrific time to buy.

We've never had a decline in house prices

on a nationwide basis.

Homes may see an ebb and flow in the price

but you're not going to see the collapse

that you see when people talk about a bubble.

If there is a bubble burst, as they call it,

I sort of hope that happens because then people like me would go out and buy.

A new warning that the housing bubble is about to burst.

* How to say no to you *

It's poppin'!

Our entire economy is in danger.

And that means life as most Americans know it,

now it is about to change.

14 million people took a mortgage

in the last three years. They will lose their homes.

This is crazy!

That rate is actually higher among people of color.

* Ba, ba, ba, ba, ba, ba *

San Bernadino recently became the third

Californian city to file bankruptcy.

And unlike a home owner who can walk away

from a mortgage that's more than the house is worth,

a municipality cannot.

* I never knew how to say no *

If you come back to this property,

it's considered trespassing.

Did you ever think that this word could become

50% of your business? -No, never would've imagined.

-* Say yes * -Yes, I found a flaw

in the model that defines how the world works.

-* Never knew how * -Your ideology was not right?

-* To say no * -Precisely.

* Say yes *

* Never knew Yes *

* Never knew how to say no *

Jar opener, everyone needs one of those.

Yeah, it's not in here.

That's 10 by 17 for the living room.

That was 18 counting the counter.

Did you count this two feet here? -No.

I've only been doing real estate with him

since Natalie was two so that's, um, 16 years.

After the L.A. Times article, the Nightline piece, all that,

I remember us being just completely crazy busy.

I mean, as, as great as it was, it was such a blur.

It was a blur? -Yeah, complete blur.

You think when I said blur,

you think that I don't know all those details?

I'm just saying blur meaning it was

a blurred time of my life.

Well, let me add some color then

because I remember every detail.

I'm sure you do. -The blog was running...

I don't wanna talk about those details.

Because of our connection to Countrywide,

they started, at least they had us apply

to be one of the agents, that's what happens.

You should watch yourself do this 'cause it's...

December 2006,

this house sold for a million dollars.

1900 square feet, right across the street from the freeway.

One million.

That's what we call a retro water heater. A vintage.

Oh, lovely.

If you, uh, are watching this video and you're a realtor,

and you're jumping off the couch saying,

"Wait a minute, I represented the buyer

when they paid a million",

I want you to put your Mai Tai down and go grab your shingle

and send it in to the D.R.E. right now.

You don't deserve to be licensed.

December 2006, this sold for a million dollars.

Everyone who was on that deal deserves to get fired.

I'm Jim, The Realtor.

There's a lot of trust...

...in the marketplace on value.

Could this be just a value bubble where people

just keep paying these crazy prices a lot more

than they used to just, literally, a year ago,

just because they wanna get a house.

There really isn't the evidence to help support them

that I can say, "Oh, for sure, it's worth that."

There's really, I think, some valid concern

about valuations when the proof is so thin.

It's always been a problem in this industry.

There is really just that one way to determine

what something is worth is look what other people pick.

What if the other people were crazy?

They were hoping to get two million dollars

for these up here, and you can see they built,

I think, a handful of 'em and gave up.

And those are five and six thousand square-foot houses.

Everyone was going by the mantra, "Get in,

or you might get priced down forever."

'Cause, up to that point, no one had seen

any previous downturn, it just wasn't in the vocabulary

and nobody, including realtors, ever really thought,

hey, party's never gonna end.

I mean, the thing about this is this is the kind of crap I used to build.

I was the engineer who would design

and lay out and build this stuff.

I would work on these big development projects.

Cities would come to us, we want this done,

we go out and build it and I sincerely believe

that the work I was doing was building a great America.

But then I started to ask some questions

about what comes next.

After we build something, how do we take care of it?

What's the cash flow that makes this all work?

I started to look at developments that I had worked on

and run some larger math problems.

For example, the developer would come in and build the road,

the developer paid all the cost to build it.

People have been paying their taxes,

and the idea was they pay their taxes,

and then the government would fix this road.

The cost was $354.000 to fix that road.

We asked the question, okay, based on the taxes

the city's collecting from these people,

how long is it gonna take them to recoup

the money they just spent?

The answer is 79 years.

As an engineer, I knew that road wasn't gonna last 20, 25 years.

This doesn't make any sense.

The growth creates what we call, "the illusion of wealth."

If you lose money on every transaction, you don't make it up in volume.

Where are we at today?

We... we're like way out here.

You can look at the run up to the housing crash as a prime example.

Everybody felt like, well we're doing okay because, you know, yeah,

I made $12.000 in housing payments

but my house went up by $40.000.

I cashed out the difference, I'm doing fine.

You're essentially skirting around the core problem

which is that the underlying economy does not work.

In 2000, we had 1100 census tracts in this country

that you could classify as persistent poverty.

In 2010, it went from 1100 census tracts

to 3300 census tracts, three times the American geography

is now in persistent poverty.

Our places don't work, they're just designed to decline.

If you don't know what was lost,

you... you don't look at the place and see,

like, this is decline.

Well I'm 43. If you're 10 years, 20 years, 30 years older than me,

all you see is wounds.

And so it's really hard for you to get your mind out of that,

and actually see how this could be a better place.

Now we have an Olive Garden so we've made it, right?

I don't know, man, in the Mid-West is heartbreaking.

The Mid-West is heartbreaking.

Think of all the places, this is like,

one of the last ones I live in

but it's home and I, you know,

there's a part of me that loves it too. -Yeah.

Like I look at it and I'm like, I wanna help this place,

I want to make it better. -Yeah sure.

I'm moving the little Google street view guy...

Yeah, yeah.

...down South 6th Street.

Yeah, that was our... -Holy shit, man.

That's our Champs-Elys�es, man, that's our one street...

One muffler shop after another. -Yeah, I know.

I'm educated enough to, to know that I shouldn't talk about

some race things because I'm, I'm... I realized how ignorant I am.

I mean, I grew up in a city that is 99% white

and probab... still is very close to that.

But when you start to get a mixing of people

in the community like "the other" start to move in,

whether "the other" is someone of a different race

or someone of a different social class,

I think, like, psychologists have said

there's a natural human tendency to in a sense,

like circle the wagons.

And what zoning did is it gave like this really

wonderful tool to be able to write

in a more camouflaged kind of racist way,

uh, we don't want those people here.

I think the irony today is that

it's also now trapped poor white people.

The mechanic says you owe

$250 for new brake lines.

Doug. -Well, what is you better go to that dude in my neighborhood,

he'll fix anything for $40. -White boy, you know Cecil?

Yeah, but my Cecil's name is Jim and he fixed my refrigerator,

my air conditioner and my cat.

Yeah, yeah, everybody's got a guy.

Ooh, you alright, Doug.

You know, Kareem Abdul-Jabbar said,

"The, uh, hyper problem we have today is less race

than it is poverty."

And I think he was exactly right,

I mean, there... there's a racial element to it,

but middle-class whites will sacrifice poor whites too.

There's no racial loyalty there,

they're gonna kick 'em to the curb.

I've been able to travel around the country

and experience different communities.

Uh, it's the same, it's the same thing.

So you see across the Rust Belt

and you see across rural America, people struggling,

and those struggles are kind of shared struggles

with people in urban areas that have long been left behind.

When you find that you can no longer get the mortgage,

uh, when you can no longer cash out the equity,

when you can no longer get the car loan for the new car,

your world changes and your experience changes,

and America becomes like a really cruel place.

We're starting to see more and more,

that is a mainstream experience.

How are you going to get your message to anybody

when even the commissions aren't here and nobody else

comes to council meetings, how do you...

How are you gonna get to the people?

You can create a social contract and make tons of promises.

Uh, we now live in the day when those promises are coming due.

And that's not a left or a right thing.

Uh, it kind of transcends left and right,

'cause neither side understands that.

They both wanna go back to what they thought worked.

It didn't work.

Baltimore is very similar

to many cities in terms of the way

that it's been wrecked by post-industrialization.

Between 1950 and 2000, Baltimore lost

100.000 million factory jobs.

So that's had a negative effect on people feeling like

they have control over the necessities of their lives.

We don't like it then.

They can run around and they say, you bet,

they can run around and gas and everything else.

We're paying for it!

And what the hell are the guys on the streets doing?

Nothing!

They're sittin' on the corners,

they can't work,

they got no work.

Doesn't mean anything at all!

And we're not gonna be fooled against each other anymore.

We're gonna fight with each other, no matter the Hispanics,

the colored, white, anything, we're gonna be a rainbow.

Not only this community, we're gonna get 'em

all together and fight!

We will build it.

Together.

Port Covington.

And when we build it...

...it will be ours.

Port Covington, a bold vision for Baltimore.

At the heart of it, a new world headquarters

for UnderArmour, an opportunity for all of Baltimore.

This will be big, Baltimore big...

Tonight, Baltimore City Council

put the stamp of approval on the $660.000.000

for the Port Covington project.

The developers guarantee the city affordable housing,

jobs in exchange for the investment.

Our intent is to have a mixed income, diverse community.

Their definition of affordable housing

is affordable to families who're making

about $70.000 per year.

So what we're saying is, you just can't build

a community with people who are wealthy.

This sort of a, you know, snarkiness

is not helpful to the discussion. -Boo!

It doesn't follow logically... -But if only a select few

individuals get to move into those neighborhoods,

is there still inequality?

No.

All in favor.

Aye.

Any opposed?

Remember, we are creating structural disadvantage

in ourAfrican-American communities, but we're creating

structural advantage in our white communities.

And that's where we are today.

It wasn't 'til I got older and started understanding

um, politics a little bit more,

and at the same time I started

getting real big into, uh, black history

and about the things that America had done to us.

A gun shot, a stab that makes the evening news,

that's spectacular violence.

We readily recognize that is violence, right?

But we don't recognize redlining as slow violence.

We don't recognize putting people in environments

where they don't have opportunity as slow violence.

But that's what's going on in Baltimore City.

I was sitting here at my desk watching the police

and the children interact on the day of April 27th, 2015.

And the children were throwing rocks,

the police throwing rocks back at the children.

And eventually, the police, you know,

they're shooting rubber bullets and they deploy tear gas,

and at the moment they deploy that tear gas,

I'm sitting here and I'm like, I feel like

this weight come right on my chest,

and I'm like, I can't breathe.

I couldn't watch it anymore because I knew it was causing

some sort of physiological reaction in my body.

It really was, uh, a powerful, pivotal turning point,

'cause everybody went into overdrive after that.

Everybody went into throwing themselves into activism

and non-profit work and volunteerism.

So, um, this is what you're gonna talk about here.

So you're gonna talk about what is home

in a neighborhood mean to you?

Exercise is set up for you to be with a person

that you would least likely be with in the room.

Partner up and really sit with your partner, folks,

don't sit side by side like this, sit...

How you doing, Miss Gale? -Hi, Greg.

I'm originally from Greenmount, the Greenmount area.

To me, that small section of a neighborhood is everything

because it's a certain level of pain

you gotta go through to be, uh, really from Baltimore,

and when you're really from a neighborhood

that has a reputation, you get what's known as a stamp.

I have my, my literal stamp.

You know? Uh...

Zone 18, it stands for the last two digits

of your area code, so it's really big,

you know, to be connected to a neighborhood.

What people outside this street don't understand,

all of this stuff is about legacy.

We don't really know where we come from,

we don't know our families. So when you decide

that you're a street dude, then you put your all into being a street dude.

It's really the only industry that we run,

or we think we run, you get what I'm sayin'?

So from there, your kids grow up under your name.

What is your name? What kind of name you wanna leave for your children?

You get what I'm sayin'? That... That's the name my father left for me.

I, I could go anywhere I want to in East Baltimore

and not have a problem because of who my father was.

But, because I'm not a street dude,

and, but I still carry those morals,

I gotta leave my son something.

I'mma buy a block in this city.

And it's gonna be a...

It's gonna be new block, I'm tryin' to tell you.

I'm gonna help a lot of people just by giving them

places to stay in, and doing what I know how to do,

use these hands.

I know too much about real estate

to not get them into these homes.

That's gon' be my legacy, that's gon' be my legacy.

It wasn't until the early '70s

when they started putting money into the harbors,

and said it would back into the neighborhoods, which it did not.

I have seen so much in Baltimore and it hasn't changed

uh, from when I was younger to now.

Telling us, our neighborhoods are bad,

and it's dangerous, and then we, as African-Americans,

feed into it, and then we move out,

and then other people move in, then all of a sudden,

the neighborhood's good again.

People who've been here and have been mentally beaten up

their entire life, there's so much

that you got to be mad at.

That feeling of hopelessness in me,

kind of manifested itself into hate.

So when you get the opportunity to display your anger,

and it's been pent up forever, it just,

it goes way beyond anybody could think.

Hey guys, theyjust set the CVS on fire.

They just set the CVS on fire.

What you get an the example of is

what's really inside of everybody.

Our trials is they build up and build up.

How far is this gonna go?

As far as they take us.

As far as they take us. -What is this...

Watch out for that.

See that? Theyjust...

Did you see that?

We just saw that

they just, while we were talking,

they've just cut through that hose.

We just saw that guy cut through the hose

trying to thwart the efforts of the authorities

to actually turn out this fire.

So I'm gonna stop it right here.

I just wanted you to see this piece first,

but I wanna do something else in here too.

You saw that young man was poking

the water hose with the pocket knife?

Well, I want you to know, that's him right there.

Right there.

At 21, with no priors,

I spent two years fighting 25.

And people was trying to give me more time than I had been on Earth.

It was scary, but it was eerily familiar,

because it felt like, no matter what I accomplished in my life,

being the first person to go to college,

graduating high school, I felt like

I was supposed to be there.

It's kind of hard for you to... take this stuff

that we see here and translate it into the humanity of it

as a person.

A million.

I got a million dollars in restitution.

$100 a month, that's 10.000 months.

Anybody know anybody here that's lived 10.000 months?

Yeah, can't leave the city 'til my restitution's paid.

Wait what? -Whoa. I didn't know that.

Yeah, can't, you're not allowed to leave your city

'til the restitutions paid. -Seriously?

These are the struggles that don't make the news.

These are the differences that make people

like myself turn off from everybody.

Hate yourself, you know what I mean?

Because everybody else hates you.

When people make the claim of, you know,

why would people burn down their own neighborhood?

I think it's sort of a glib statement,

to sort of gloss over the fact that many of these neighborhoods

don't have investment to begin with.

I mean, why would they burn down their own community?

I mean, it really isn't a community

that they've been able to have ownership in.

* Don't push me 'Cause I'm close to the edge *

Black communities have been pushed to the edge

and I think that is sort of why we see some

of the uprisings we see now.

Black lives matter!

People may begin to understand

that black lives matter, but black lives don't matter

if black neighborhoods don't matter.

I came back here subsequently when I was a police officer.

And it was all bricked up, all the, the windows, the doors.

It's choice property now.

The area is gentrified.

You know, gentrification, I suppose,

on one hand is a good thing 'cause it cleans up

the neighborhood, it makes it nice.

But my heart goes out to the people who once lived here,

who got moved out, because where did those poor people go?

You know, they were forced out of their neighborhood.

Their homes are gone.

If we as a country don't pay attention

to the places where people live, the homes that people have,

then we'll continue to go in circles and not really

get to the root of the problem.

When you look at a rainforest,

you're seeing a very complex ecosystem.

Not only do you have these massive trees,

but you have all the understory, all the animals.

Every leaf has its own individual ecosystem.

And when you add up all of that, you have this massive, massive complexity.

You compare that to, say, a corn field.

You have one species of plant, a complete monoculture.

And what you see is a very efficient undertaking.

And you produce a lot of corn in a very small space.

But you certainly don't have the complexity

and the ability to thrive that a rainforest does.

So what we did is we switched cities

from being complex systems to corn fields.

You look back in history, though,

in the way humans evolved along with the city.

And what you see is that messiness,

that friction, that rubbing up against other people,

is an essential component of it.

And there was a certain discomfort that went along with that,

but there was also a social dimension to it,

that we've just completely lost.

This pattern of development has allowed us

to be intentionally ignorant of the pain

and the hurt and the needs

that go along in all our places.

* My house was shoved On the corner *

* On a gravel Road Edmund Street *

* But here's You missed and you got 'em *

* Never wanted help from me *

* You'll never say I'm the one *

* Ayo ayo *

* You'll never say I'm the one *

* Ayo ayo *

* Ayo ayo... *

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