“The Inevitable Products of Racial Segregation”: Multigenerational Consequences of Exclusionary Housing Policies on African Americans, 1910–1960

Date01 May 2018
DOIhttp://doi.org/10.1111/ajes.12229
Published date01 May 2018
“The Inevitable Products of Racial
Segregation”: Multigenerational
Consequences of Exclusionary Housing
Policies on African Americans, 1910–1960
1
By LOUIS LEE WOODS II*
ABSTRACT. From 1910 to 1960, whites fought viciously and persistently
to prevent African Americans from living in decent housing in racially
integrated neighborhoods. In 1910, Baltimore was the first city to adopt
an ordinance banning African Americans from white neighborhoods. In
part, this law was justified as a means to restrain the violent behavior of
white citizens who might otherwise act as vigilantes against their black
neighbors. Other cities followed suit. These racial zones were declared
unconstitutional by the U.S. Supreme Court. However, for 31 years this
Court sanctioned the adoption of private restrictive covenants that were
effective at blocking African Americans from buying or renting a house
in a white neighborhood. In the 1930s, the insertion of racially
restrictive covenants became both a protective mechanism and a
prerequisite for federal mortgage lending, insurance, and guarantees by
a variety of national housing agencies. In effect, the federal government
enforced racial segregation even though local governments were not
allowed to. The net effect of three decades of federal housing programs
was to drive an economic wedge between federally subsidized housing
for whites and federally enforced denial of housing loans in African
American neighborhoods. Those policies made whites wealthy at the
expense of African Americans, a condition that still persists and will
continue to do so in the absence of federal intervention to reverse the
wealth gap it helped to create.
*Associate Professor of African-American History and Africana Studies Program
Director at Middle Tennessee State University. Graduating Phi Beta Kappa, Dr. Woods
received his B.A. degree in Africana Studies from SUNY Stony Brook. M.A. and Ph.D.
in African American History from Howard University. Research has appeared in
Journal of Urban History, Journal of African American History, and Health Promotion
Practice.
American Journal of Economics and Sociology, Vol. 77, Nos. 3–4 (May-September, 2018).
DOI: 10.1111/ajes.12229
V
C2018 American Journal of Economics and Sociology, Inc.
***
Introduction
A multigenerational examination of 20
th
century housing policy
reveals a striking continuity, resulting in the exclusion of African
American access to newly constructed national housing stock. While
the mechanisms have certainly evolved over time, the restrictive
intent of policy has remained perpetually the same: exclusion based
on race. Policies have developed from racial zoning, to racially
restrictive covenants, to government inspired redlining, to discrimina-
tory federal mortgage insurance, to barring African American veter-
ans from the housing component of the GI Bill, and racially biased
real estate policy. The curtailment of African American access to fair
housing remained steadfastly and unapologetically apparent for two-
thirds of the 20
th
century.
This article showcases the evolution of these discriminatory policies
from the enactment of Baltimore, Maryland’s first municipal legislation
restricting the parameters of the city’s African American community to
The American Journal of Economics and Sociology2
; a perfectly straightforward state-
ment, containing only seven words. People who have mastered Kant,
Hegel, Shakespeare, Marx, Freud, and the Bible find this statement
utterly impenetrable. The idea seems to threaten profound, barely con-
scious assumptions. A kind of panic paralyzes their features, as though
they found themselves trapped on the edge of a steep place ... [W]hat
has happened, unfailingly, whenever a significant body of Negroes move
North .... [is that] they do not escape Jim Crow: they merely encounter
another, not-less-deadly variety. They do not move to Chicago, they
move to the South Side; they do not move to New York, they move to
Harlem. The pressure within the ghetto causes the ghetto walls to
expand, and this expansion is always violent. White people hold the
line as long as they can, and in as many ways as they can, from ver-
bal intimidation to physical violence. But inevitably the border which
has divided the ghetto from the rest of the world falls into the hands of
the ghetto. The white people fall back bitterly before the black horde;
the landlords make a tidy profit by raising the rent, chopping up the
rooms, and all but dispensing with the upkeep; and what has once
been a neighborhood turns into a “tur f.” (James Baldwin [1960] 1985:
211–212)
Negroes want to be treat ed like men
968
the national proliferation of racially restrictive covenants. This article
also briefly examines the discriminatory policies created by a variety of
federal housing agencies: the Federal Home Loan Bank Board
(FHLBB), the Home Owners’ Loan Corporation (HOLC), the Federal
Housing Administration (FHA), and the Veterans Administration (VA).
Finally this article inspects the racially exclusionary policies imple-
mented by national and local real estate boards, paying particular atten-
tion to the impact these policies had on the housing conditions
endured for a g eneration (1940 –1960) by Afri can American v eterans
and, more generally, by the broader black community. Utilizing racial
wealth gap literature, this article also providesa window into the gener-
ational implications of unequal housing access that continues to reso-
nate within the descendants of would-be African American
homebuyers in the early 20
th
century.
This article offers a national or macro-level economic perspective on
the discriminatory housing policies endured by African American com-
munities and the devastating generational impact this has had on the
descendants of its victims. This is no easy task, primarily because the
history of U.S. housing discrimination is incredibly complicated. During
the 20
th
century, at least 12 federal agencies implemented housing poli-
cies that either unapologetically endorsed residential segregation or
acquiesced to local cultural norms of segregation. The federal housing
agencies included: the Department of Housing and Urban Develop-
ment, the Federal Home Loan Bank Board, the Federal Home Loan
Bank System, the Federal Housing Administration, the Federal National
Mortgage Association, the Home Owners’ Loan Corporation, the
National Housing Agency, the Housing and Home Finance Agency, the
Public Housing Administration, the Reconstruction Finance Corpora-
tion, the U.S. Housing Authority, the Urban Renewal Administration,
and the Veterans Administration.
As a result of this complexity, researchers have rightly chosen to
focus their scholarly attention on a particular federal agency, a precise
tactic promoting racial segregation, or a specific geographical location
to examine these issues on a manageable local level. Academic studies
of national redlining have primarily focused on the Federal Housing
Administration or the Home Owners’ Loan Corporation. Scholars have
examined racial zoning and racially restrictive covenants. Considerable
Consequences of Exclusionary Housing, 1910–1960 3
969

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