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576 pages, Paperback
First published September 29, 2005
FHA publications repeatedly listed “inharmonious racial or nationality groups” alongside noxious disamenities as “smoke, odors, and fog.” Again, this was the familiar “blacks as the problem” ideology, and the FHA’s solution was identical to that employed by independent sundown towns: keep “the problem” out. Palen states that loan guarantees by the FHA and Veterans Administration (VA) were the most important single cause of postwar suburbanization and more than 98% of the millions of home loans guaranteed by the FHA and VA after World War II were available only to whites. This was the money that funded the Levittowns and most other postwar sundown suburbs. America became a nation of homeowners largely after World War II, in the suburbs. Indeed, more Americans bought single-family homes in the decade after the war than in the previous 150 years, according to historian Lizbeth Cohen. African Americans were thus not only shut out of the suburbs but also kept from participating in Americans’ surest route to wealth accumulation, federally subsidized home ownership. Federal support for home ownership not only included the FHA and VA programs but also the mortgage interest tax deduction, which made home ownership in the suburbs cheaper than apartment rental in the cities—for whites. Housing prices then skyrocketed, tripling in the 1970s alone; this appreciation laid the groundwork for the astonishing 1-to-11 black-to-white wealth ratio that now afflicts African American families. (35)
When the federal government did spend money on black housing, it funded the opposite of suburbia: huge federally assisted high-rise “projects” concentrated in the inner city. We are familiar with the result, which now seems natural to us, market-driven: African Americans living near the central business district and whites living out in the suburbs. Actually, locating low-income housing of cheaper, already vacant land in the suburbs would have been more natural, more market-driven. One of Chicago’s most notorious housing projects, Cabrini Green, lies just a stone’s throw west of an expensive and desirable lakefront neighborhood north of the Loop, separated by the elevated railroad tracks. This is costly land. To justify its price, the Chicago Housing Authority had to pile hundreds of units onto the tract, building poorly devised physical structures that bred a festering, unsafe social structure. The steps taken by suburban developers and governments to be all-white were interferences in the housing market that kept African Americans from buying homes and locked them in overwhelmingly black tracts inside the city.
