Maybe it’s too early for post-mortems. But the results the other night seemingly all but settled the Democratic primary race, which may have turned on a single moment.
Earlier this year, at a union rally in Henderson, Nevada, Hillary Clinton introduced a new theme in her stump speeches.
"If we broke up the big banks tomorrow," Clinton asked, "would that end racism?"
Logically, it was an odd thing to say. After all, lots of things worth doing, even political things, won't "end racism."
But from a practical point of view, Clinton's gambit was brilliant politics. It effectively caricaturized Sanders as a one-note candidate too steeped in attacking billionaires to see the problems of people down on Main Street. And the line fit in a tweet, making it perfect for rocketing around the Internet.
Clinton probably also understood that most people don't draw a connection between Wall Street corruption and race. Although the first victims of the financial crisis tended to be poor, nonwhite and elderly, tales of iniquity in the billionaire class tend instead to resonate with a different audience — specifically, the white liberals and college students who flocked to the Sanders campaign.
There was a political cliché behind this disconnect. When most people hear the words "Wall Street," they think of the stock market. And since African-American voters have traditionally distrusted and avoided the stock market, at least in comparison to white investors, there is a perception that "Wall Street" is an issue that doesn't really concern black people.
In the subprime era, though, banks actually used this cliché to their advantage. They profited immensely from a real-estate operation that specifically targeted people who stayed away from the financial markets, and carefully guarded their money by putting it in their homes.
According to one study, about two-thirds of all subprime loans between 2000 and 2007 were made to people who already owned their homes. The targets were often elderly, in particular men and women of color. Visiting loan officers convinced these borrowers to use the homes they'd poured their savings into their whole lives as ATM machines.
The pitch was: refinance your home, and get a little extra spending money each month! Lots of people went for it. But there was mischief hidden in the fine print of many of these "refi" deals, which often quickly exploded. Before long, the now-departed agent's promises would evaporate into a toxic quicksand of debt, unforeseen penalties and foreclosure.
Like a lot of reporters who covered the crash era, I initially misunderstood the profound racial element in the subprime drama. This wasn't the S&L crisis or the Enron-era accounting scandals or even the Internet bubble, a speculative craze that devoured the savings of white Middle America.
Subprime was different. It was fueled by a particular kind of predatory lending that targeted a very specific group of people.
In the 2000s, armies of smooth-talking real-estate hustlers from companies like Countrywide and New Century poured into residential areas across the country, but particularly into black neighborhoods. They made wild promises, in many cases offering huge loans in exchange for little or no money down.
Once the agents got signatures on these loans, they quickly sold them up the financial river to Wall Street, where the great banks repackaged them for resale at huge profit to pension funds and other investors. The scheme depended on getting huge numbers of names on new loans.
Thanks to a number of settlements, we now know that some companies got many of those new signatures via intentional strategies targeting black and Hispanic customers. The most infamous example was Wells Fargo, which paid a $175 million settlement for systematically overcharging black and Hispanic borrowers.
It came out that a Maryland office of the bank referred to subprime loans as "ghetto loans," and pushed its loan officers to unload as many as possible on the "mud people" of Baltimore and the surrounding suburbs. A crucial element involved pushing expensive and dangerous subprime loans on people who qualified for the safer, lower-interest prime loans.
The New York Times did a study of New York-area home lending and found that African-Americans who made more than $68,000 were five times as likely as white people in the same income category to be marketed risky subprime loans. The ratio was even worse at Wells Fargo, where it was more like eight to one.
Some of the pitches made by real-estate hustlers during this time bore a striking resemblance to crude predatory schemes that had targeted black homeowners in generations past.
The wide-scale falsification of employment data in mortgage applications that subprime companies used to get as many borrowers into loans as possible? That same scam happened decades ago in cities all over America, most memorably in Brooklyn in the Sixties and Seventies.
In one particular case involving a firm called Eastern Services (a kind of crude precursor to Countrywide), FHA officials were bribed en masse in a scheme that led to tens of millions of dollars in losses and thousands of vacated homes.
It was the same hot-potato game as subprime. Then as now, the idea was to create lots of loans and quickly sell them off to unsuspecting institutional suckers down the line, like savings banks and pension funds.
In conjunction with better-known offenses like blockbusting (i.e., clearing neighborhoods of white residents through scare tactics), the misdeeds of companies like Eastern Services helped destroy black neighborhoods practically overnight. They did so in much the same way the modern foreclosure crisis has now left deserts of blighted homes in cities all over the country, from Trenton to Fort Wayne to Fayetteville to Rochester to Port St. Lucie and beyond.
Likewise, the "interest-only" or "negative amortization" loan of the subprime era, which allowed people to jump into new houses with little or no money down, was little more than an homage to the "contract mortgage." The latter was an infamous type of zero-equity real estate loan-sharking that targeted black homeowners throughout the pre-Civil Rights era.
Wall Street in the crisis era experienced an ideological shift. The ideas of people like Ayn Rand, once considered extremist, became mainstream. The heads of powerful companies became seduced by a vision of an America made up of "producers and parasites."
Under this reasoning, it was only natural that the wealth-creating "producers" should take all of the financial power, because the parasites down below would otherwise just brainlessly consume it.
We saw this in comments like Mitt Romney's crack about "the 47 percent" or his incredible admonition to the NAACP chiding people who want "free stuff," or in billionaire Charlie Munger's angry response to people who wanted mortgage relief after the crash.
"There's danger in just shoveling out money to people who say, 'My life is a little harder than it used to be,'" said Munger, who himself had benefitted massively from federal bailouts. "At a certain place you've got to say, 'Suck it in and cope, buddy.'"
These lunatic resentments drove the effort to blame minority homeowners for the crisis. That effort peaked in a Tea Party movement triggered by a rant by CNBC goof Rick Santelli against the "losers" of the housing crisis. He described them as the "people who drink the water" at the expense of those who "carry the water." As coded language went, it was remarkably un-subtle.
Race was always at the very center of the crash story. It was just never explained that way in the press.
When Hillary Clinton used that line about breaking up the banks not ending racism, she opened a door for Bernie Sanders to talk about all of this. He could have talked about Wall Street not just as a symbol of international greed and corruption, but in terms of a more peculiarly American kind of ugliness.
He could have begun with subprime and plausibly traced all the way back to 40 acres and a mule, explaining the modern problem of wealth inequality as (among other things) a still-extant failure of the Civil Rights movement, an ancient wrong still not corrected.
But he didn't. Sanders I believe fundamentally sees the Wall Street corruption issue as a matter of class, i.e., rich vs. poor. He never found a way to talk about the special edge the financial sector brought/brings to the exploitation of nonwhite America.
I don't know and wouldn't presume to know if any of this explains why Clinton performed so extremely well with black voters compared with Sanders. Surely there are hundreds of factors. The idea of a monolithic "black vote" is always one of the more insidious clichés of campaign journalism anyway, as Collier Meyerson explained so well in The New Yorker last week.
But this is less about whether or not Sanders failed to reach "the black vote" than it is about a greater overall failure of many of us who followed these issues, myself included, to eloquently connect Wall Street corruption to the pain at the Main Street level. Nobody was ever able to truly popularize that reality, make it felt.
Sanders came the closest. But if he recedes now in favor of a candidate with ties to the very banks that caused the crisis, it will mean another opportunity lost. For a little while longer at least, "Wall Street corruption" will be thought of as a niche issue. But it should be one that consumes the attention of all, rich and poor, white and black, and sometimes especially the latter.