Housing Policy

Washington Forced Segregation on the Nation

It's time to remedy the effects of that terrible policy.


In 1940, the federal government required a Detroit builder to construct a six-foot-high, half-mile-long, north-south concrete wall. The express purpose was to separate an all-white housing development he was constructing from an African-American neighborhood to its east. The builder would be approved for a Federal Housing Administration (FHA) loan guarantee he needed only if he complied with the government's demand.

Today, most African Americans in every metropolitan area remain residentially concentrated or entirely separate. That fact underlies or exacerbates many of the nation's most serious social and economic problems, from relatively low intergenerational mobility to the disproportionate prevalence of hostile encounters between police and disadvantaged black youths in neighborhoods without access to good jobs. The Detroit wall offers a striking illustration of an underappreciated truth about this shameful situation: Racial segregation in America was, to a large degree, engineered by policy makers in Washington.

Beginning in the 1930s, civil rights litigators won court victories that desegregated law and graduate schools, then colleges and, with 1954's Brown v. Board of Education ruling, elementary and secondary schools. These legal victories helped to spur a civil rights movement that, in the 1960s, forced an end to racial segregation in public transportation, in public accommodations, in employment, and in voting.

Yet despite those victories, America has left untouched the biggest segregation of all: Progress in the desegregation of neighborhoods has been minimal.

In low-income, racially segregated communities, children are in poorer health, are under greater stress from parents' economic insecurity, and have less access to high-quality early childhood, after-school, and summer programs. When children with these and other challenges are concentrated in a single school, their problems can overwhelm teachers, and educational outcomes suffer. The "black-white achievement gap," a focus of education reformers, is substantially attributable to residential segregation.

This form of segregation is more difficult to eradicate than many others. After the abolition of discrimination on buses and at lunch counters, African Americans could take any empty seat on a bus or sit at any lunch counter. But the Fair Housing Act's prohibition of future discrimination in housing left previously segregated neighborhoods intact.

Americans have rationalized our failure to achieve desegregated neighborhoods by adopting a national myth shared by the left and the right, by blacks and whites: that what we see around us is de facto, not legally enforced, segregation. It's the result not of a government design to keep the races separated but rather of private prejudice, the personal preferences of both blacks and whites to live with same-race neighbors, and income differences that make integrated communities unaffordable to many African Americans.

This is a small part of the truth. In reality, explicit government policy in the mid-20th century—imposed in the name of promoting safety and social harmony—was the most powerful force separating the races in every metropolitan area, and the effects of that policy endure. Because racial segregation results from the open, racially explicit, purposeful action of federal, state, and local governments, our residential racial boundaries are unconstitutional; because they are unconstitutional, we have an obligation to ensure that our government remedies them; because we have forgotten the history of how residential segregation was created by government, we are handicapped in our ability to address it.

The New Deal's Segregated Housing Projects

During the Depression, to provide lodging for lower-middle-class white families, the New Deal created America's first civilian public housing. Some projects were built for black families as well, but these were almost always separate from the white projects. At the time, many urban areas were sites of considerable diversity, with black and white workers living within walking distance of downtown factories and other workplaces. Communities near train stations were often integrated, for example, because railroads would hire only African Americans as baggage handlers or Pullman car porters.

When Franklin Roosevelt became president, the nation was facing a desperate housing shortage. Many black and white working families lived in neighborhoods that, while integrated, could rightly be described as slums. To improve the quality of housing, as well as to provide jobs for construction workers, one of the first New Deal agencies, the Public Works Administration (PWA), demolished housing in many such integrated neighborhoods and built explicitly segregated housing instead. The policy created racial boundaries where they had not previously existed or reinforced them where they had taken root, giving segregation new government sanction. In Atlanta's "Flats," the government demolished a neighborhood that was about half white and half black to build a public housing project for whites only, with a separate project for African Americans farther away. In St. Louis' DeSoto-Carr neighborhood, housing in a similarly mixed neighborhood was demolished to build a project for African Americans only, with a separate project for whites built in a different part of the city.

This, it should be emphasized, was not primarily a program for the South or border states. In Northern and Midwestern states, the federal government's New Deal programs and local housing agencies worked together to create segregated patterns that have persisted for generations. In his autobiography, The Big Sea, the African-American poet and novelist Langston Hughes described going to high school in an integrated Central Cleveland neighborhood where his best friend was Polish and he dated a Jewish girl. The PWA cleared housing in that area to build one project for whites and another for African Americans. In Cambridge, Massachusetts, the Central Square neighborhood between Harvard University and the Massachusetts Institute of Technology was about half white and half black at the beginning of the 1930s. The federal government demolished integrated housing there to create two racially separated projects.

In Boston, the federally financed Mission Hill project was for whites, while the Mission Hill Extension across the road was for African Americans. In Chicago, the Julia C. Lathrop and Trumbull Park Homes were built in white neighborhoods for whites only; the Ida B. Wells Homes were built in an African-American area for blacks only. This government housing program exacerbated existing racial patterns; had the projects been integrated, Chicago would not now be one of the most segregated cities in the nation.

During World War II, whites and African Americans flocked to jobs in war plants, sometimes in communities that had no tradition of segregated living. Yet the government built separate projects for blacks and whites, determining future residential boundaries. Richmond, California, a suburb of Berkeley, was one of the nation's largest shipbuilding centers. It had few African Americans before the war; by its end, thousands were living in public housing along the railroad tracks, while white workers were assigned to housing in more established residential areas. Along the Pacific coast, racial segregation in Portland, Seattle, San Francisco, and Los Angeles has its roots in federal war housing.

Postwar, veterans desperately needed lodging, so President Harry Truman proposed even more housing projects. Congressional conservatives, deeming public housing socialistic, resolved to defeat Truman's 1949 legislation. They introduced a "poison pill" amendment banning racial discrimination in public housing, which they expected Northern liberals to support, ensuring its passage. Then they planned to ally with Southern Democrats to defeat the amended legislation.

Instead, the liberals mobilized against the integration amendment. "I should like to point out to my Negro friends what a large amount of housing they will get under this act," Illinois Sen. Paul Douglas urged. "I am ready to appeal to history…that it is in the best interests of the Negro race that we carry through the housing program as planned rather than put in the bill an amendment that will inevitably defeat it." Douglas was persuasive: The amendment was defeated and the Housing Act passed, including permission to continue a policy of discrimination.

In the 1950s, a government program guaranteed loans to builders of working-class suburban subdivisions—with explicit requirements that black families be excluded and that house deeds prohibit resale to them.

I doubt that segregated housing was in anyone's best interest, but it's no easy call. The NAACP had the foresight to reject Douglas' plea. Many African Americans, however, welcomed the subsequent construction of all-black towers like Brownsville's Van Dyke Houses (now the poorest community in New York City) or Chicago's Cabrini-Green. Located in places where African-American poverty was already concentrated, these new high-rises replaced barely habitable slum dwellings, wood-frame firetraps frequently without plumbing, heat, or adequate sanitation. Yet the towers' racial isolation came at a price, solidifying ghettos where our most serious social problems—unemployment, violence, confrontations with police, inadequate student achievement, health disparities, multi-generational poverty—fester to this day.

Federal Subsidies and the 'White Noose'

By the mid-1950s, housing projects for whites had many unoccupied units, while those for African Americans had long waiting lists. Eventually, as whites continued to leave the inner cities, almost all public housing was opened to African Americans.

At about the same time, industry began to leave urban centers. Automakers, for example, closed many downtown assembly plants and relocated to rural and suburban areas to which African-American workers had less access. Good urban jobs became scarcer and public housing residents became poorer. A program that originally addressed a middle-class housing shortage became a way to warehouse the poor.

Why did white-designated projects develop vacancies while black-designated ones faced more demand than supply? The disparity largely resulted from an FHA program that guaranteed loans to builders of working-class suburban subdivisions—with explicit requirements that black families be excluded and that house deeds prohibit resale to them.

This was not an act of rogue bureaucrats. It was written policy, in blatant violation of the Fifth, 13th, and 14th amendments to the U.S. Constitution. The Federal Housing Administration published a manual used by real estate appraisers nationwide, specifying that loans for suburban development could not be federally subsidized if an "inharmonious racial group" would be present or was already nearby. Suburbs like Levittown (east of New York City), Lakewood (south of Los Angeles), San Lorenzo (across the Bay from San Francisco), and hundreds of others were created in this way, ensuring their racial homogeneity and isolation.

After World War II, the white novelist Wallace Stegner was recruited to teach writing at Stanford University. Given the housing shortage, he could find no place for his family to live, so he joined a cooperative of 150 families that bought a large ranch adjoining the university with a plan to build 400 homes. Banks, however, would not extend loans for such subdivisions without a federal guarantee—the construction of so many houses for which there were yet no buyers with approved mortgages was just too risky. And the federal government would not guarantee the Stegner project because three of the 150 families were African-American. The co-op refused to expel its black families, disbanding instead. A private developer purchased the land and, with FHA support, built an all-white subdivision in its place, complete with federally mandated deed restrictions prohibiting resale to black families.

Urban public housing combined with FHA-subsidized whites-only suburbs to create a "white noose" around urban black families that persists to this day. Every metropolitan area suburbanized in the mid-20th century, with all-white subdivisions surrounding an urban core where African Americans were concentrated. In 1968, the Fair Housing Act permitted African Americans to access previously white neighborhoods, but it prohibited only future discrimination, without undoing the previous 35 years of government-imposed segregation.

This had not just social but economic consequences as well. In suburbs such as Levittown, Lakewood, and San Lorenzo, houses in the 1940s and '50s sold for about $100,000 (in today's inflation-adjusted currency), twice the national median income. FHA and Veterans Administration amortized mortgages made such homes affordable for working-class families of either race, but only whites were allowed. Today, all are technically welcome, but homes in these places can sell for $400,000 (or more), seven times the national median income—unaffordable to working-class families of either race. Consequently, whites who suburbanized with federal protection in the mid-20th century gained $300,000 (or more) in equity that could be used to pay for a child's college education, care for their elderly parents, subsidize their own retirement income, cover medical expenses or other unforeseen economic emergencies, or bequeath wealth to children and grandchildren, who then had down payment funds for their own homes. Black families and their offspring, who largely remained in cities as renters, gained no such security.

Although average African-American family incomes today are about 60 percent of average white family incomes, average African-American household wealth is only about 10 percent of average white household wealth. This enormous disparity is almost entirely the result of unconstitutional federal housing policy in the last century, which explains a good part of the racial inequality that we see all around us.

Undoing 60 Years of Bad Policy

In 1935, Congress adopted a National Labor Relations Act that gave unions the exclusive right to bargain with employers, provided those unions gained government certification. When the act was first introduced, it prohibited the government from certifying unions that excluded African Americans from membership. That provision was deleted from the final bill, and the federal government proceeded to certify all-white unions, including the most powerful unions in the construction trades. Not until 1964 did the government deny certification to such a group.

Cabrini-Green Homes. Photo by Betty Hulett/Chicago History Museum.

Think about that for a moment: Not only did Washington prohibit African Americans from living in the suburbs, but it also sanctioned their exclusion from the construction of those same suburbs and from fully participating in the great postwar economic expansion that boosted so many white working-class families into the middle class. If too many African Americans today cannot afford to move to middle-class communities, the government's labor policy as well as its housing policy bears significant responsibility.

If we developed a new national consensus that rejected the myth that residential segregation has only ever been de facto, we could then begin to discuss ways to chip away at the problem. The largest federal housing program today is the mortgage interest deduction, a continued subsidy to many racially exclusive suburbs. One remedy might be to make the claim of this deduction by homeowners in a racially exclusive community contingent on that community's taking steps to desegregate.

The next largest federal housing program is a tax credit for developers of housing for low-income families. Most tax-credit projects are located in already low-income neighborhoods, because developers would rather build in places where they face no community opposition. The result is that the program reinforces segregation. Prioritizing integrated development could eliminate that distortion.

Addressing the sad status quo requires regulating the actions of private citizens, something that libertarians tend to resist. In this case, such resistance fails to consider the fact that segregation was created by the indefensible regulation of private citizens—regulation designed to create, reinforce, and sustain a dual and unequal housing market. Those who object to remediating such artificial racial segregation must make a case that what happened unnaturally can unhappen naturally. But that case is impossible to make: The government's control over housing markets to impose segregation was so powerful that its effects have already endured for more than half a century following the end of explicit racial housing policies.

What types of rules might the federal government consider to address that problem? On the deregulatory side, it could prohibit suburbs from maintaining zoning policies that discourage construction of less expensive housing options, such as townhouses, apartments, or even modest single-family homes on smaller lots. Secretary of Housing and Urban Development Ben Carson has stated that he wants to prohibit exclusionary zoning and withhold federal funds from suburbs that maintain such land use regulations. There is no evidence, however, that his department has taken this offhand comment seriously.

The federal government could go further and require that all new development be mixed-income. For lower-income families hoping to move from segregated to integrated neighborhoods, it could prohibit landlords from discriminating against holders of "Section 8" vouchers. It could even adjust how the vouchers are administered to make it affordable to use them in middle-class areas. In the context of our shameful history, these and many other policies are not only feasible. They are constitutionally required.

Carson has stated his opposition to aggressive policies aimed at residential desegregation. He calls such actions "social engineering" and warns that they always have unintended consequences. His reasoning is flawed on two counts. First, desegregation is an effort to undo previous bad social engineering, not to create utopia from a blank slate. Second, unintended consequences are inevitable. Policy makers have an obligation to develop programs carefully in order to eliminate the most serious harmful consequences to the extent possible. But there are unintended consequences to inaction as well. The mortgage interest deduction, the Low-Income Housing Tax Credit, and Section 8 are all race-neutral programs. Their unintended consequence is to reinforce and perpetuate racial segregation. They continue to do so, every day.

Certainly, many whites in the early and mid-20th century were bigoted; government policies that resulted in residential segregation were not merely forced upon them. And certainly many whites and blacks sometimes prefer to live in same-race neighborhoods. But private prejudice and personal preferences do not negate the sin of government sponsorship. The U.S. Constitution prohibits government from violating civil rights by supporting popular—even majority—demands for discriminatory actions. The counterfactual is not whether we would have segregation if government did not exist. The counterfactual is what the nation would look like if government had fulfilled its constitutional responsibilities.

William Levitt, the builder of Levittown, was a bigot. He acknowledged that, left to his own devices, he would have refused to sell homes to African Americans. But he was not left to his own devices. No bank would lend him the capital to build 17,000 homes for which he yet had no buyers. He could proceed only if he obtained a government guarantee of his bank loans. The Federal Housing Administration was constitutionally obligated to issue such a guarantee only if he sold homes on a nondiscriminatory basis. It failed in this responsibility.

Likewise, the Public Works Administration and subsequent war and public housing agencies were constitutionally obligated to rent public housing on a nondiscriminatory basis. Instead, they built projects specifically designated for one racial group or another.

Had the PWA and FHA acted in a lawful manner, some bigoted white families might have refused to live in public projects or to purchase suburban homes. But the housing shortage was so severe that for any family that so refused, many were waiting to take its place. Had federal agencies performed in a nondiscriminatory fashion, the landscapes of our metropolitan areas today would be much more diverse than they now are.

Our belief in de facto segregation is paralyzing. If our racial separation stems from millions of individual decisions, it is hard to imagine the millions of private steps it would take to undo it. But if we learn and remember that residential segregation results primarily from forceful and unconstitutional government policy, we can begin to consider equally forceful public action to reverse it.

We must teach this history to our young people as well. Today, the most widely used American history high school textbooks fail to tell the truth about how segregation was created. They adopt our national myth by describing segregation in the North as de facto, pretending that government-sponsored segregation took place only in the South. They describe how the New Deal built housing for the homeless during the Depression but fail to mention that it segregated previously integrated communities. They praise the FHA's contribution to suburbanization but ignore that it benefited whites only. Parents and others should insist that public schools use alternative curricula that accurately convey how our nation became segregated. If we don't do a better job of instructing future generations, they will fail as miserably as we have in creating a fair and integrated society.

Parts of this article have been adapted from the author's previous work.