There was an exceptionally good interview on Fresh Air yesterday with Richard Rothstein, explaining the way ghettoization in the US was an official government policy, along with the fact that it fully accounts for the massive wealth gap – as distinct from income gap – between blacks and whites. Whites were able to buy cheap decent housing in the 40s and 50s while blacks were not, so that became the equity that is now the wealth that while people have while black people have 5% of that wealth. 5%.
5%. That’s a lot of university educations not paid for, houses not bought, equity not built.
Richard Rothstein, a research associate at the Economic Policy Institute, has spent years studying the history of residential segregation in America.
“We have a myth today that the ghettos in metropolitan areas around the country are what the Supreme Court calls ‘de-facto’ — just the accident of the fact that people have not enough income to move into middle class neighborhoods or because real estate agents steered black and white families to different neighborhoods or because there was white flight,” Rothstein tells Fresh Air’s Terry Gross.
Or, at least, that it’s a mix of that and more deliberate causes. I think that’s what I thought. But whatever I thought, I did not know the scale of what Rothstein said.
“It was not the unintended effect of benign policies,” he says. “It was an explicit, racially purposeful policy that was pursued at all levels of government, and that’s the reason we have these ghettos today and we are reaping the fruits of those policies.”
They transcribed highlights.
On how the New Deal’s Public Works Administration led to the creation of segregated ghettos
Its policy was that public housing could be used only to house people of the same race as the neighborhood in which it was located, but, in fact, most of the public housing that was built in the early years was built in integrated neighborhoods, which they razed and then built segregated public housing in those neighborhoods. So public housing created racial segregation where none existed before. That was one of the chief policies.
That’s one. I did not know that. It’s so easy for me not to know it, isn’t it.
The second policy, which was probably even more effective in segregating metropolitan areas, was the Federal Housing Administration, which financed mass production builders of subdivisions starting in the ’30s and then going on to the ’40s and ’50s in which those mass production builders, places like Levittown [New York] for example, and Nassau County in New York and in every metropolitan area in the country, the Federal Housing Administration gave builders like Levitt concessionary loans through banks because they guaranteed loans at lower interest rates for banks that the developers could use to build these subdivisions on the condition that no homes in those subdivisions be sold to African-Americans.
And I did not know that. Holy shit. Daly City was another one, just south of San Francisco; all white, thank you very much. Those little houses in Levittown and Daly City? Worth a fortune now. Gee what a shame that African-Americans were never allowed to buy them when they were $10 k. Rothstein broke it down for us: at the time those houses were worth two years at an average wage. Now they’re worth seventy.
Another nice kicker? Rents were higher in black-segregated areas, because segregated housing was scarcer. Lose lose lose every way you turn.