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The Making of Ferguson: Long before Michael Brown was shot, official racist policies primed Ferguson for what happened this summer
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Sid Shniad
2014-10-19 23:40:34 UTC
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*http://prospect.org/article/making-ferguson
<http://prospect.org/article/making-ferguson> *

*The American Prospect October 14, 2014*
The Making of Ferguson

*Long before the shooting of Michael Brown, official racial-isolation
policies primed Ferguson for this summer’s events. I don’t mean to imply
that there is anything special about racial history in Ferguson, St. Louis,
or the St. Louis metropolitan area. Every policy and practice segregating
St. Louis was duplicated in almost every metropolis nationwide. Yet this
story of racial isolation and disadvantage, enforced by federal, state, and
local policies, many of which are no longer practiced, is central to an
appreciation of what occurred in Ferguson this past summer, many decades
later. Policies that are no longer in effect and seemingly have been
reformed still cast a long shadow.*
*Richard Rothstein*

In 1968, Larman Williams was one of the first African Americans to buy a
home in the white suburb of Ferguson, Missouri. It wasn’t easy; when he
first went to see the house, the real estate agent wouldn’t show it to him.
Atypically, Williams belonged to a church with a white pastor, who
contacted the agent on Williams’s behalf, only to be told that neighbors
objected to sales to Negroes. But after the pastor then gathered the owner
and his neighbors for a prayer meeting, the owner told the agent he was no
longer opposed to a black buyer.

Williams had been living in the St. Louis ghetto and worked as an assistant
school principal in Wellston, a black St. Louis suburb. His wife,
Geraldine, taught in a state special education school. They could afford to
live in middle-class Ferguson, and hoped to protect their three daughters
from the violence of their St. Louis neighborhood. The girls would also get
better educations in Ferguson than in Wellston, where Williams worked,
because Ferguson’s stronger tax base provided more money per pupil than did
Wellston’s; Ferguson could afford more skilled teachers, smaller classes,
and extra enrichment programs.
Art by Mary Parsons

Williams was familiar with Ferguson because he once lived in the
neighboring black suburb of Kinloch. (California Congresswoman Maxine
Waters and the comedian and activist Dick Gregory grew up there.) In those
years, Williams could enter Ferguson only during daytime; until the
mid-1960s, Ferguson barred African Americans after dark, blocking the main
road from Kinloch with a chain and construction materials. A second road
remained open so housekeepers and nannies could get from Kinloch to jobs in
Ferguson.

Kinloch and some middle-class white neighborhoods that also adjoin Ferguson
were once unincorporated in St. Louis County, but in the late 1930s the
white neighborhoods formed a city, Berkeley, to separate their schools from
Kinloch’s. With a much smaller tax base, Kinloch’s schools were inferior to
Berkeley’s and Ferguson’s, and after Berkeley’s incorporation, Kinloch took
on more characteristics of a dilapidated ghetto. This arrangement persisted
until 1975—several years after Williams moved into Ferguson—when federal
courts ordered Berkeley, Ferguson, and other white towns to integrate their
schools into a common district with Kinloch.

Other African Americans followed Williams into Ferguson, but the black
community grew slowly. By 1970, Ferguson was still less than 1 percent
black. But it had some multi-family buildings, so when public housing in
St. Louis was demolished in the 1970s, the St. Louis Housing Authority gave
vouchers to displaced families to subsidize rentals in Ferguson. By 1980,
Ferguson was 14 percent black; by 1990, 25 percent; by 2000, 53 percent;
and by 2010, 67 percent. Other northern and northwestern suburbs near St.
Louis were similar. Meanwhile, those beyond the first ring to the south and
west remained almost all white. Recently, the white population in the city
itself has been expanding.

In what follows, I’ll describe how St. Louis became so segregated—a pattern
where racial boundaries continually change but communities’ racial
homogeneity persists. Neighborhoods that appear to be integrated are almost
always those in transition, either from white to mostly black (like
Ferguson), or from black to increasingly white (like St. Louis’s
gentrifying neighborhoods). Such population shifts in St. Louis and in
other metropolitan areas maintain segregation rules established a century
ago.

I tell this story with some hesitation. I don’t mean to imply that there is
anything special about racial history in Ferguson, St. Louis, or the St.
Louis metropolitan area. Every policy and practice segregating St. Louis
was duplicated in almost every metropolis nationwide. Yet this story of
racial isolation and disadvantage, enforced by federal, state, and local
policies, many of which are no longer practiced, is central to an
appreciation of what occurred in Ferguson this past summer, many decades
later. Policies that are no longer in effect and seemingly have been
reformed still cast a long shadow.



Larman and Geraldine Williams told their story at a 1970 hearing of the
United States Commission on Civil Rights, along with another middle-class
black integration pioneer, Adel Allen, an engineer who came to St. Louis in
1962 to work at the McDonnell Space Center. Allen was ready to quit and
return home to Wichita, Kansas, after no realtor would sell him a suburban
home. He was unwilling to live in a small apartment in the overcrowded St.
Louis ghetto—apparently his only alternative.

Allen finally succeeded in getting a white friend to make a “straw
purchase” (hiding the true buyer) of a home in Kirkwood, another nearly
all-white St. Louis suburb; a second friend gave him $5,000 toward the
$16,000 price. The funds were probably needed because the Federal Housing
Administration would not insure mortgages for African Americans in
Kirkwood, and no bank would issue them. Allen’s income was higher than
those of the 30 white homeowners on his block—he alone had a college
degree. Once he moved in as the second African American there, “for sale”
signs sprung up on neighboring lawns; eight years later, the ratio was 30
black homeowners to two white homeowners.

Allen described life in Kirkwood in 1962 and then in 1970:

[W]hen I first moved there 
 I don’t know if [the police] were protecting
me or protecting someone from me. We had patrols on the hour. Our streets
were swept neatly, monthly. Our trash pickups were regular and handled with
dignity. The street lighting was always up to par. 
 We now have the most
inadequate lighting in the city ... [P]eople from the other sections of
town 
 now leave their cars parked on our streets when they want to abandon
them. 
 [W]hat they are making now is a ghetto in the process. The
buildings are maintained [by owners] better than they were when they were
white but the city services are much less.

The commission’s general counsel then asked if Allen had ever been stopped
by police. He responded:

Yes, I don’t think there’s a black man in South St. Louis County that
hasn’t been stopped at least once if he’s been here more than two weeks. 

There’s an almost automatic suspicion that goes along with being black. 

[T]here is an obvious attempt toward emasculation of the black man. I’ve
been stopped, searched, and I don’t mean searched in the milder sense, I
mean laying across the hood of a car. And then told after they found
nothing that my tail light bulb was burned out 
 something like that.

Nearly three years before Larman Williams and Adel Allen gave their
accounts, African Americans had rioted in scores of cities. President
Lyndon Johnson then asked a group of prominent Americans, headed by
Illinois Governor Otto Kerner, to investigate the riots’ causes. The Kerner
Commission concluded that stories like those of the Williamses and Allen
were typical: discriminatory provision of municipal services, police
practices reflecting “attempts toward emasculation of the black man,”
housing discrimination, and much more. Kerner’s report concluded that the
nation was “moving toward two societies, one black, one white—separate and
unequal.”

August’s confrontations in Ferguson suggest less has changed than many
Americans think. Yet the government’s response has been to examine Ferguson
as an isolated embarrassment. The Department of Justice is investigating
the death of Michael Brown and the racial practices of Ferguson’s police
department, but has not suggested recent events reflect anything broader
than Ferguson’s unique problems.

Media reports have explained that suburbs once barred African Americans
with private agreements among white homeowners (restrictive covenants) and
with racially neutral zoning rules that restricted outer-ring suburbs to
the affluent, with inner-ring suburbs flipping from white to black because
of “white flight.” Modern segregation, in other words, is attributable to
private prejudices of white homeowners who abandon neighborhoods when
blacks arrive, and to the inability of African Americans to afford
communities restricted to single-family homes on large lots.

No doubt, private prejudice and suburbanites’ desire for homogeneous
middle-class environments contributed to segregation in St. Louis and other
metropolitan areas. But this explanation too conveniently excuses public
policy. A more powerful cause is the explicit intents of federal, state,
and local governments to create racially segregated metropolises. The
policies were mutually reinforcing:

• Zoning that defined ghetto boundaries within St. Louis, turning black
neighborhoods into slums;

• Segregated public housing that replaced more integrated urban areas;

• Restrictive covenants adopted by government mandate;

• Government-subsidized suburban development for whites only;

• Boundary and redevelopment policies to keep blacks from white
neighborhoods;

• Real estate and financial regulatory policy that promoted segregation;

• Denial of services in black ghettos; convincing whites that “blacks” and
“slums” were synonymous;

• Urban renewal programs to shift ghetto locations, in the guise of
cleaning up those slums;

• A government-sponsored dual labor market that made suburban housing less
affordable for blacks.

That government, not private prejudice, was responsible for segregating
greater St. Louis was once widely recognized. In 1974, a federal appeals
court concluded, “Segregated housing in the St. Louis metropolitan area was

 in large measure the result of deliberate racial discrimination in the
housing market by the real estate industry and by agencies of the federal,
state, and local governments.” The Department of Justice stipulated to this
truth but took no action in response. In 1980, a federal court ordered the
state, county, and city governments to devise plans to integrate schools by
integrating housing. Public officials ignored the order, devising only a
voluntary busing plan to integrate schools, but not housing.



Although policies to impose segregation are no longer explicit, their
effect endures. When we blame private prejudice and snobbishness for
contemporary segregation, we not only whitewash history but avoid
considering whether new policies might instead promote an integrated
community.

In the early 20th century, St. Louis’s small black population resided
alongside other low-wage workers and their families, including European
immigrants. Some blocks had greater African-American concentrations,
interspersed with blocks concentrating other groups.
(AP Photo/St. Louis Post-Dispatch, David Carson)

Protesters pause on Grand Boulevard en route to the St. Louis University
campus, where hundreds of demonstrators announced they were staging a
sit-in, on Monday, October 13, 2014, in reaction to the shooting this
summer of Michael Brown, a black, 18-year-old, by a white police officer in
Ferguson, Missouri.

But then, segregationist sentiment and activity increased nationwide. In
1916, St. Louis voters approved a referendum prohibiting blacks from moving
to predominantly white blocks. One year later, the Supreme Court banned
such ordinances, so St. Louis and other cities relied upon new, nominally
race-neutral zoning rules that defined boundaries of industrial,
commercial, multi-family residential, and single-family residential
property. According to the city’s chief planner, a zoning goal was to
prevent movement into “finer residential districts 
 by colored people.”
St. Louis’s first zoning ordinance deliberately designated areas for
industrial development that were in or adjacent to neighborhoods with
substantial black populations. The policy continued for decades. In 1942,
the Plan Commission rezoned a commercial area as multi-family so it could
“develop into a favorable dwelling district for Colored people.” In 1948,
it designated a U-shaped industrial zone to create a buffer between black
residences inside the U and white residences outside.

Polluting industry, taverns, liquor stores, nightclubs, and houses of
prostitution were permitted in black neighborhoods but violated zoning
rules elsewhere. After the Federal Housing Administration (FHA) was
established during the New Deal, these establishments rendered black
neighborhoods ineligible for mortgage insurance, because they devalued
nearby residential property. Later, ghettos were designated for slum
clearance because zoning rules had made them unfit for habitation.

Urban zoning set patterns for the suburbs. Those farthest from St. Louis
were typically zoned for single-family homes with large lots only. Those
closer were more likely to permit multi-family residences.

Racial motivation was sometimes open. In 1940, Kirkwood officials prepared
a plan to shift its small black population to St. Louis because it was
“more desirable for all of the colored families to be grouped in one major
section.” A 1963 plan in Webster Grove, a town between St. Louis and
Kirkwood, outlined steps to prevent enlargement of a “developing ghetto”
across a rail bed it called the “Great Divide.”

In 1933, Congress authorized a public housing program, headed by Franklin
Roosevelt confidante Harold Ickes, whose “neighborhood composition rule”
declared that public housing could not alter neighborhood racial
characteristics. But as Roosevelt’s biographer James MacGregor Burns
concluded, cities “in which prewar segregation was virtually unknown 

received segregated housing, starting a new ‘local custom’ still in force
many years later.”

St. Louis proposed to raze a 40-percent black tenement neighborhood to
construct a whites-only project. When federal officials objected to the
failure to accommodate African Americans, St. Louis eventually proposed an
additional blacks-only project, removed from the one for whites and in
another previously integrated area. The segregated projects were eventually
opened in 1942, with preference for workers in war industries and then,
later, for veterans.

One scholar of the St. Louis urban landscape has observed, “[T]he City Plan
Commission, the St. Louis Housing Authority, the mayor’s office, and the
Board of Aldermen conspired to transform two multiethnic mixed-race
neighborhoods—one on the north side and one on the south side—into racially
homogeneous projects.” A federal judge noted that the conspiracy included
federal officials: “The limitation of [projects] to white occupancy was
approved by the Public Housing Administration, conditioned upon the
provision of [separate] facilities for non-white occupancy.”

With a nationwide civilian housing shortage, President Truman proposed a
massive public housing effort in 1949. Republican opponents introduced a
“poison pill” amendment prohibiting segregation in public housing, knowing
that if it passed, southern Democrats who otherwise supported public
housing would kill it. Liberals had to choose either segregated public
housing or none at all. Illinois Senator Paul Douglas argued, “I am ready
to appeal to history and to time that it is in the best interests of the
Negro race that we carry through the [segregated] housing program as
planned, rather than put in the bill an amendment which will inevitably
defeat it.” The amendment failed and the 1949 Housing Act, providing
federal finance for segregated public housing, was adopted.
Courtesy Missouri History Museum, St. Louis

Several African-American World War II veterans soon sued the St. Louis
Housing Authority after being denied more desirable whites-only apartments.
In 1955, a federal judge ordered the authority to cease segregation, but
the ruling came too late. By then, FHA policy to move working-class whites
to suburban home ownership was in full swing. St. Louis’s white-designated
projects gradually added African Americans as previous residents, many with
federally guaranteed mortgages, departed for the suburbs from which blacks
were excluded.

At this time, St. Louis also began constructing the Pruitt-Igoe towers.
Pruitt had been intended for blacks and Igoe for whites, but by their
1955–1956 opening, few whites were interested; there were so many
inexpensive options for them in south St. Louis and the suburbs. Igoe then
filled with black families as well.

Pruitt-Igoe became a national symbol of dysfunctional public housing,
characterized by welfare-dependent families and pervasive gang activity. It
gave the lie to Senator Douglas’s promise that it would be in the “best
interests of the Negro race that we carry through” with a segregated
program. Deteriorating social conditions and public disinvestment made life
in the projects so untenable that the federal government evicted all
residents and dynamited the 33 towers, beginning in 1972.

When St. Louis leaders developed zoning rules to control black population
movement early in the 20th century, private real estate agents and
individual white homeowners began to enact restrictive covenants to prevent
African Americans from purchasing covered property. The National
Association of Real Estate Boards provided model language. Its St. Louis
affiliate, the Real Estate Exchange, provided a “Uniform Restriction
Agreement” for neighborhood groups to use. By 1945, about 300 neighborhood
covenants were in force. The city’s Plan Commission hesitated to zone an
area “first residential” if covenants were absent. Courts in Missouri and
elsewhere ordered sales canceled if made in violation of such agreements.

Although the Supreme Court upheld the legality of such covenants in 1926,
it found in 1948 that state courts could not enforce them without violating
the 14th Amendment. The decision came in Detroit and St. Louis cases
(others were litigated elsewhere), and came to be known by the St. Louis
case, *Shelley v. Kraemer*.

It arose from a homeowners association covenant requiring a black family’s
eviction. A Presbyterian church sponsored the association and funded the
lawsuit. Another church was also a signatory; its pastor had previously
defended the covenant in court. Such sponsorship by tax-exempt institutions
constituted a federal subsidy. In an unrelated case four decades later, the
Supreme Court found Bob Jones University ineligible for tax exemption
because of its prohibition of interracial dating, but the government never
questioned the prominent involvement of tax-exempt churches, hospitals, and
universities in enforcing segregation. If church leaders had to choose
between their tax exemptions and racial exclusion, there might have been
many fewer covenants blanketing white St. Louis.

Racial covenants were an important condition, almost a requirement, of FHA
suburban mortgage insurance. The FHA’s 1938 underwriting rules stated that
“restrictive covenants should strengthen and supplement zoning ordinances.”
It financed construction of entire subdivisions by making advance
commitments to builders who met FHA standards for construction, design, and
racial exclusivity. Developers with such commitments could get low-interest
loans to underwrite construction, and could assure potential (white) buyers
that homes were FHA-approved for low-interest mortgages, with no or limited
down payments.

The FHA’s suburban whites-only policy continued through the post-war
housing boom that lasted through the mid-1960s. In 1947, the FHA sanitized
its manual, removing literal race references but still demanding
“compatibility among neighborhood occupants” for mortgage guarantees. In
1959, the Commission on Civil Rights summarized: “With the help of FHA
financing, all-white suburbs have been constructed in recent years around
almost every large city. Huge FHA-insured projects 
 have been built with
an acknowledged policy of excluding Negroes.”

The FHA seal of approval guaranteed that a subdivision was for whites only.
Advertisements like those from 1952 (shown at right) were commonplace in
St. Louis (and nationwide). The ad promotes “FHA Financed” Ferguson homes;
the other ad promotes an “FHA approved” Kirkwood subdivision.
Missouri History Museum, St. Louis

One builder, Charles Vatterott, obtained FHA guarantees for St. Ann, a town
he started constructing in 1943. Its deeds stated, “No lot or portion of a
lot or building erected thereon shall be sold, leased, rented or occupied
by any other than those of the Caucasian race.” Vatterott then built a
separate, lower-quality subdivision a few miles away, De Porres, for
African Americans. De Porres buyers had incomes and occupations—from truck
drivers to chemists—similar to those in St. Ann; had they been permitted,
they could have moved to St. Ann or other white subdivisions built in the
postwar period. Vatterott could not get FHA financing for his black
subdivision, so many De Porres homes were rented. De Porres also lacked
parks and playgrounds that Vatterott had built into St. Ann.



As covenants and zoning rules barred African Americans from most areas, a
growing black population crowded ghettos on St. Louis’s north and west
sides. Trash collection, street lighting, and emergency response were less
adequate than in white neighborhoods. African Americans paid higher rents
than whites for similar space because their housing supply was constricted;
less adequate city fire protection caused higher insurance rates. With FHA
mortgages unavailable, families bought homes with very short repayment
periods, or on contract where no equity accumulated. A late installment
payment could trigger repossession. To make higher rent or contract
payments, black families took in boarders or subdivided homes and
apartments, exacerbating the overcrowding. With higher housing costs,
African Americans with good jobs were less able to save than were whites
with similar incomes, and reduced savings made leaving the ghetto for
better surroundings more difficult. If a new black neighborhood developed,
St. Louis sometimes changed its zoning to permit polluting industries and
other deleterious businesses to locate there.
Whites observing the ghetto concluded that slum conditions were
characteristics of black families, not of housing discrimination.
Government policy thus created stereotypes that spurred “white flight.”

Suburbs sometimes employed eminent domain procedures to prevent blacks from
moving in. In 1959, an African-American couple attempted to build on a lot
in the white suburb of Creve Coeur. The town approved permits and
construction had begun when neighbors discovered the buyers were black.
Townspeople raised contributions to purchase the property, but could not
pressure the couple to sell, so the city condemned it for a playground. A
Missouri appeals court ruled it could not question the town’s motives,
provided the condemned property was for public use.

In 1969, a church-sponsored nonprofit group proposed to build federally
subsidized, integrated, multi-family units in Black Jack, a white suburb in
unincorporated St. Louis County. Black Jack quickly incorporated itself and
adopted zoning rules prohibiting more than three homes per acre, making new
moderate-income housing impossible. African-American residents of St.
Louis, noting their limited access to suburban employment, filed suit. A
federal appeals court found that opposition to the project was “repeatedly
expressed in racial terms by 
 leaders of the incorporation movement, by
individuals circulating petitions, and by zoning commissioners themselves.

 [R]ace played a significant role, both in the drive to incorporate and
the decision to rezone.” But meanwhile, the church group lost its
financing, interest rates climbed, and the federal government feared
further white opposition. The church group’s lawyers acknowledged that,
despite the ruling, “[n]o developer in his or her right mind” would proceed
in the face of such hostility. It was never constructed.

Other suburbs, too, subsequently incorporated to forestall African-American
movement from St. Louis, where, as more public housing was demolished, less
housing remained. Perhaps learning from Black Jack, civil rights groups
mostly didn’t bother filing similar suits.

Several suburbs, with century-old black residential pockets, designed
redevelopment projects that forced those residents to seek public housing
back in St. Louis, while St. Louis itself implemented urban renewal that
forced blacks into nearby suburbs and attracted white suburbanites to the
city. Beginning in the 1950s, slum housing occupied mostly by African
Americans was razed and replaced with the Jefferson National Expansion
Memorial (which includes the Gateway Arch), a museum, a sports stadium, new
industry and hotels, university expansion, middle-class housing
unaffordable to the former African American residents, and interstate
highways (including ramps and interchanges) to bring suburbanites to
white-collar city jobs. Sometimes, as happened nationwide, after
African-American neighborhoods were demolished, planners’ designs for
redevelopment never materialized and cleared land remained vacant. One
early 1960s St. Louis project demolished an African-American neighborhood
of 70 blocks and 221 acres. Fifty years later, much of it remains vacant or
paved over.

Half of displaced African Americans were offered no relocation assistance.
Displaced families relocated to public housing or to apartments adjoining
their former ghettos that were as substandard as prior residences. When
public housing itself became unavailable, the St. Louis Housing Authority
issued rent supplement vouchers to eligible families. From 1950 to 1980, it
assigned some 8,000 families to public housing or subsidized apartments,
almost all in overwhelmingly African American neighborhoods.

As space in St. Louis disappeared and African Americans pushed out,
realtors “blockbusted” northern and northwestern suburbs, neighborhood by
neighborhood. The practice contributed to the transformation of inner-ring
suburbs like Ferguson—from white communities that excluded African
Americans to deteriorating nearly all-black (or becoming all-black) suburbs.
U.S. Geological Survey
The Pruitt-Igoe towers became a national symbol of dysfunctional public
housing.

Blockbusting was not unique to St. Louis. It was commonplace nationwide.
Typically, an initial African-American family, like the Williamses or
Allens, found housing in a lower-middle-class white neighborhood just
outside the ghetto. A realtor might arrange the sale, perhaps subsidizing
it himself. Once the family visibly arrived, real estate agents solicited
nearby homeowners to sell quickly before their homes lost value from the
arrival of blacks. Sometimes, agents hired black youth to drive around
blasting music, placed fictitious sale advertisements in African American
newspapers (and showed copies to white homeowners), or hired black women to
push baby carriages around. Some speculators did not have initial African
American buyers but simply bought property and let it stay empty and
deteriorate to depress the value of other nearby homes and panic homeowners
to sell at reduced prices. Speculators could then buy the homes and resell
at inflated prices to African Americans desperately needing housing. Some
agents did not resell homes, but subdivided and rented them to black
families. When Adel Allen described how “for sale” signs quickly went up on
his Kirkwood block, real estate agents were probably involved.

Realtor practice and state action were inseparable in St. Louis and
elsewhere. The St. Louis Real Estate Exchange surveyed its members in 1923
to define zones where African Americans could live. City government worked
hand in glove with the exchange, providing it with data on changing racial
residential patterns so the exchange could adapt its zoning accordingly.
The exchange’s determination of whites-only neighborhoods corresponded to
the Plan Commission’s single-family zones. By 1930, the Plan Commission
estimated that 80 percent of the city’s African Americans were contained
within zones established by the exchange. Zone boundaries were revised
substantially in 1941, and continued to guide real estate practice
afterwards.

The exchange had a rule adapted verbatim from the 1924 National Association
of Realtors code: “A realtor should never be instrumental in introducing
into a neighborhood ... members of any race or nationality 
 whose presence
will clearly be detrimental to property values in that neighborhood.” Both
the exchange and state regulators, the Missouri Real Estate Commission,
deemed sales to African Americans in white neighborhoods to constitute
professional misconduct leading to loss of license.

In 1953, an FHA report acknowledged that St. Louis had 80,000 African
Americans with stable employment who could have afforded to participate in
the postwar suburban boom. But in 1955 (seven years after Shelley v.
Kraemer), with no objection from the FHA or any regulatory body, the
exchange notified realtors that “no Member of our Board may, directly or
indirectly, sell to Negroes 
 unless there are three separate and distinct
buildings in such block already occupied by Negroes.” In 1969, a year after
the Fair Housing Act’s enactment, a realtor boasted to an investigator, “We
never sell to colored.” At that time, St. Louis realtors still asserted
they would lose their licenses if they violated the segregation rule.

Should these realtors’ practices be considered private or state action?
Almost every industry is regulated to some extent, so state action requires
more than mere regulation. Yet few industries are as regulated as real
estate. Licenses require extensive study, testing, and recertification.
Regulations cover detailed practices—not only rules for who can show homes
or proper handling of escrow, but realtors’ private behavior. Yet while
racial steering had been unlawful since 1866, Missouri and national realtor
ethics rules required it. Even blockbusting was not deemed unethical by the
Missouri Real Estate Commission until 1970, two years after federal law
reiterated its illegality; subsequently, enforcement has been weak or
nonexistent.

Only banking and insurance are more regulated than real estate, and these
industries also played important roles in segregating St. Louis and the
nation. For most of the 20th century, banks routinely and openly practiced
“redlining”—refusing mortgages or home improvement loans to African
Americans in predominantly white as well as black neighborhoods. Federal
and state regulators took no notice. Until the 1960s, insurance companies
likewise refused to serve African Americans in redlined areas or where
restrictive covenants were broken. The nation’s leading insurance companies
became developers themselves of segregated apartment complexes.

The lower incomes of African Americans today, contributing to their
inability to afford housing in the more affluent suburbs of St. Louis and
other metropolitan areas, cannot be understood in isolation from this
history of pervasive housing segregation. In the nearly two decades
beginning in 1950, the number of jobs in the city of St. Louis declined by
20 percent, while those in suburban St. Louis County increased by 400
percent. The spatial mismatch between St. Louis neighborhoods where African
Americans mostly lived, and the better suburban jobs they had difficulty
accessing, exacerbated racial income inequality. That inequality, in turn,
reinforced the housing segregation.

Even for black workers who were able to work in the suburbs, incomes were
effectively reduced relative to those of whites because of higher commuting
costs. For example, from 1959 to 2009, Chrysler operated an assembly plant
in suburban Fenton. Black workers living in the St. Louis ghetto and unable
to live near the plant spent up to an hour commuting each way. Today, the
town of Fenton remains 96 percent white, less than 0.5 percent black.

The auto industry and union were unusually hospitable to black workers. But
not all industries and unions were. Those African Americans who could have
commuted to better jobs were denied membership by many white-only labor
unions. In St. Louis (and elsewhere), unions excluded black workers but
nonetheless were recognized as exclusive bargaining agents by the federal
government. Certification of such practices by the National Labor Relations
Board was eventually found to be a constitutional violation, but not until
the suburban housing boom was mostly complete. We now understand that, for
both races, intergenerational income mobility is quite limited, which means
we are still paying a price for these practices, with Ferguson but one
illustration.



A century of evidence demonstrates that St. Louis was segregated by
interlocking and racially explicit public policies of zoning, public
housing, and suburban finance, and by publicly endorsed segregation
policies of realty, banking, and insurance industries. These government
policies interacted with public labor market policies that denied African
Americans access to jobs that comparably skilled whites obtained. When all
of these mutually reinforcing public policies conspired with private
prejudice to turn St. Louis’s African-American communities into slums,
public officials razed those slums to devote acreage to more profitable
(and less unsightly) uses. African Americans who were displaced then
relocated to the few other places available, converting towns like Ferguson
into new segregated enclaves.

As the federal court observed more than 30 years ago, school desegregation
requires housing desegregation. Some schools in Ferguson today are 90
percent African American; performance of students this isolated is
inadequate. As the tragic death of Michael Brown shows, the interaction of
black men with police has much in common with Adel Allen’s experiences 50
years ago and black experiences nationwide, when such treatment set off the
riots (Ferguson’s was mild) that the Kerner Commission investigated.

Litigation has revealed that in the 2000s, federally supervised banks
marketed exploitative subprime loans to African American communities like
Ferguson, expecting that African Americans (particularly the elderly) were
too gullible to resist false promises. When the loans’ exploding interest
rates combined with the collapse of the housing bubble, black
neighborhoods’ devastation compounded. Half of Ferguson homes today are
underwater, with owners owing more than their homes are worth.

Many practical programs and regulatory strategies can address the problems
of Ferguson and communities like it nationwide. One example is a rule
prohibiting landlords from refusing to accept tenants whose rent is
subsidized; a few states and municipalities currently do prohibit it, but
most do not. Another is to require even outer-ring suburbs to repeal their
racially inspired exclusionary zoning ordinances. Going further, we could
require every community to permit development of housing to accommodate its
“fair share” of its region’s low-income and minority populations; New
Jersey, for example, has taken a very modest step toward this requirement.

But we won’t consider such remedies if we remain blind to how Ferguson
became Ferguson. We flatter ourselves that the responsibility is only borne
by rogue police officers, white flight, and suburbanites’ desire for
economic homogeneity. Prosecuting the officer who shot Michael Brown, or
investigating and integrating Ferguson’s police department, can’t address
the deeper obstacles to racial progress.
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