A recent NPR news segment featured a very illuminating interview with Richard Rothstein of the Economic Policy Institute, who revealed how current problems in Baltimore reflect a national legacy of institutionalized segregation.
He revealed how back in the 1940s, while white people on the East Coast were offered new housing in suburbs, black people were only offered public housing apartments in the same center cities where they already lived.
“In 1947, when Levittown, N.Y. was first opened, homes were sold to white, working-class families for about $8,000 apiece,” he reported. “African-Americans were prohibited from buying into those developments, even though they had the economic means to do so.
“Half-century later, those homes are now selling for $500,000. They are no longer accessible for working-class families. The white families, working-class families who moved into Levittown gained equity appreciation of perhaps 350-400,000 dollars. They used that wealth to send their children to college. They bequeathed it to their children and grandchildren.
“African-Americans living in crowded central city areas were able to accumulate none of that wealth. As a result, today, nationwide, African-American wealth is 5 percent of white family wealth. That enormous difference is entirely attributable to federal housing policy, to suburbanize the white population and keep African-Americans in central cities.
“The federal government established the segregation. But since that time, we’ve forgotten this history, and we think somehow these ghettos arose by accident and there’s nothing we can do about them to reverse the segregation.”
Rothstein’s research also revealed that in Baltimore in 1910, a black Yale law school graduate purchased a home in a previously all-white neighborhood. The Baltimore city government reacted by adopting a residential segregation ordinance, restricting African Americans to designated blocks.
Explaining the policy, Baltimore’s mayor proclaimed, “Blacks should be quarantined in isolated slums in order to reduce the incidence of civil disturbance, to prevent the spread of communicable disease into the nearby White neighborhoods, and to protect property values among the White majority.”
“Thus began a century of federal, state, and local policies to quarantine Baltimore’s black population in isolated slums—policies that continue to the present day, as federal housing subsidy policies still disproportionately direct low-income black families to segregated neighborhoods and away from middle class suburbs.
“In 1917, the U.S. Supreme Court found ordinances like Baltimore’s 1910 segregation rule unconstitutional, not because they abridged African Americans’ rights to live where they could afford, but because they restricted the property rights of (white) homeowners to sell to whomever they wished. Baltimore’s mayor responded by instructing city building inspectors and health department investigators to cite for code violations anyone who rented or sold to blacks in predominantly white neighborhoods.
“African Americans were prevented from moving to white neighborhoods by explicit policy of the Federal Housing Administration (FHA), which barred suburban subdivision developers from qualifying for federally subsidized construction loans unless the developers committed to exclude African Americans from the community.
“The FHA also barred African Americans themselves from obtaining bank mortgages for house purchases even in suburban subdivisions which were privately financed without federal construction loan guarantees.
“The FHA not only refused to insure mortgages for black families in white neighborhoods, it also refused to insure mortgages in black neighborhoods—a policy that came to be known as “redlining,” because neighborhoods were colored red on government maps to indicate that these neighborhoods should be considered poor credit risks as a consequence of African Americans living in (or even near) them.”