SO HEY Last night, I briefly mentioned that the american suburb is a creation of government intervention, and I want to expand on what I meant by that.

So, redlining was a government policy that meant black people could not purchases homes in particular areas, confining the population to specific neighborhoods and specific suburbs. A majority black area would be assessed as lower in value of property.

Simultaneously, as part of the New Deal and as part of a post-war effort to rebuild the economy, the federal government via the GI bill and other programs, began offering cheap, new construction homes to white families in the suburbs.

These homes cost approximately twice the average annual income for a white family at the time, and the mortgages were basically guaranteed by the government. This meant a TON of white families could buy suburban and buy cheap, and commute into work on newly built interstates.

Black people in the US simply didn’t have the same opportunities because of racism in the law. Additionally, because it meant that it was harder for black people to own land, which is a major equity builder for generational wealth.

Additionally, thanks to tax subsidies, lots of corporations began to build up out in the suburbs, creating a drain of workers out of cities and building them up in the suburbs - and taking tax revenue with them.

Black people, Asian-Americans, and Latinos were all denied access to the suburbs. In one particular instance in San Francisco, for example, an Asian couple’s potential move into a suburb was put to a vote from the white neighbors, and they were voted out 174-28.

So, in abandoning the cities and taking their tax dollars elsewhere, as well as their significant purchasing power that came with being white and employed in that era, cities were kinda left scrambling.

This is a big part of why a lot of cities saw spikes in crime throughout the 70s-90s, which in turn contributed to the mythos of the “dangerous inner city,” encouraging further white flight while continuing to trap communities of color in poverty.

This is also a major part of how we’re still seeing reverberations of those racist choices back in the day. White families were able to build home equity in the 50s and 60s, allowing them to pay for their kids to go to college in the 70s and 80s, creating generational wealth.

Black families didn’t have that same access until the Fair Housing Act in the 60s, which officially got rid of redlining and made it possible for black people to purchase homes in the suburbs, too.

But by then, the cheap, new construction boom of the 1940s/50s had solidified into homes that were more expensive, and despite now having greater access to mortgages, the increased prices in many areas still largely meant segregation and a lot of trouble building equity.

There’s also a lot of influence of real estate being part of the global market at the time, which also made housing prices much more unpredictable and volatile - which we saw the impact of in the collapse of 2008.

there’s ALSO the fun part that I just learned about when it comes to tax law - black families tend to be dual income households with incomes that are largely equal. White families, because of their equity, tend to be one income with a stay at home wife.

Guess which scenario gets you a better tax rate when you file jointly?

So black people are finally able to enter the housing market at a time when it’s getting volitale, more expensive, and harder to build equity because they are also taxed at higher rates.

All of that contributes to black families being structurally unable to build generational wealth in the same way whites do - all because of racist policies from 1933.

Also there’s a lot to be said about how predatory low rate mortgages that led to the 2008 crisis preyed on this lack of generational wealth amongst black families and promised them a chance at that American dream only to ruin their credit and destroy their lives.

Sourcing:

The Color of Law by Rothstein
The Whiteness of Wealth by Brown
This piece on suburbanization: https://oxfordre.com/americanhistory/view/10.1093/acrefore/9780199329175.001.0001/acrefore-9780199329175-e-64