A Dose of Reality: Racial Discrimination in US Housing

by Hannah Petry

According to American politician Patrick Buchanan, “’What the black poor need more than anything today is a dose of the truth. Slums are the products of the people who live there. Dignity and respect are not handed out like food stamps; they are earned and won” (qtd. in Squires 201). Here, Buchanan highlights one of the main ideologies that dominates American society: economic individualism. Economic individualism is built around the idea that the sole determinant of an individual’s success is how hard they work. Consequently, poverty stems from biological and cultural deficiencies that lead to a lack of work ethic. Based on this viewpoint, government intervention in terms of welfare programs is considered morally corrupting (Hasenfeld et al. 1029).

This ideology seems quite simple: work hard, and you will be rewarded. In the context of American society, however, the simplistic idea that work ethic is the sole determinant of success does not hold true for a large majority of citizens. Cycles of poverty continue to dominate inner-city neighborhoods all across the United States, yet to say that these communities are “a product of the people who live here” is to disregard the persistent racial discrimination that dominated America’s past and is still present today.

According to American sociologist Conley Dalton, the socioeconomic measure that reveals the greatest disparity among races in the United States is wealth. This is demonstrated by the statistic that African Americans own only one-twelfth the amount of property as whites. When you compare blacks and whites without considering this disparity in wealth, blacks are more likely to drop out of high school, to have a child out of wedlock, and to become dependent on welfare as young adults (Conley). Although highly flawed, this comparison is seen as evidence for economic individualism, as it perpetuates the idea that the persistence of racial inequality stems from the “personal failings or cultural limitations among nonwhites” (Squires 202).

When you compare blacks and whites with similar individual characteristics, family backgrounds, and class origins, however, these racial differences completely disappear. For example, blacks and whites with equal parental assets showed no disparity in their use of welfare as young adults (Conley). This contradicts the basis of economic individualism; namely, that there is a connection between race and government dependency in the United States. Instead, as Conley and many others argue, socioeconomic factors such as wealth are the sole determinant of predicting an individual’s use of welfare.

If government dependency in the United States results from disparities in wealth, one could claim that these disparities are simply a result of differences in work ethic among races. This individualist bias again does not hold true. According to classical economist and moral philosopher Adam Smith, social classes stem from the ability to accumulate and store resources. Therefore, the claim that differences in work ethic among races are responsible for disparities in wealth fails to account for the fact that, throughout American history, African Americans have been systematically prevented from accumulating wealth (Conley).

While there are many factors that have contributed to the unequal accumulation of wealth in the United States, this disparity is most evident in the housing market. Past and present racial discrimination in the housing market on both an individual and national level have not only lead to racially segregated communities, but varying degrees in the quality of life among different races (Squires 207).

On a national level, public policies have played a key role in dictating residential patterns in the United States. Until the 1960s, the Federal Housing Association (FHA), which is a government agency that provides mortgage insurance on loans made by approved lenders, refused to ensure loans in inner-city neighborhoods, warning of “inharmonious racial groups” in their guidelines (Cornett; qtd. in Squires 205). Without the ability to obtain insured loans, minorities in these areas were discouraged from owning property and, ultimately, accumulating wealth.

Current discrimination toward African Americans in the housing market can be seen in more subtle forms. For example, a 2000 study done by the Urban Institute revealed that, in one out of every five visits to a real estate agent, racial minorities faced unlawful discrimination. In addition to preventing minority groups from moving to white communities, this study also showed that real estate agents steered whites away from predominantly nonwhite communities by making statements like, “That area is full of Hispanics and Blacks that don’t know how to keep clean” (qtd. in Squires 205). Such “advice” not only perpetuates racial stereotypes, but also has significant influence over residential patterns in the United States.

In addition to promoting racially segregated communities, housing discrimination leads to unearned advantages for some populations and unjustified disadvantages for others. This is partly due to the fact that amenities in inner-city neighborhoods vary drastically from those found in suburbs. Between 2002 and 2003, the average amount of money spent on each student in New York City public schools was $11,627, whereas in suburban Manhasset, it was nearly double that amount. Yet, unequal resources in education are only one part of the problem. While inner-city neighborhoods are suffering an economic decline, job growth is increasing in predominantly white suburbs. What many people fail to consider is that the lack of job networks in impoverished metropolitan areas makes it nearly impossible for welfare recipients to find work (Squires 209).

Having grown up in Wilmette, a northern suburb of Chicago, I have always been curious about the drastic socioeconomic divide between my community and the South Side. How is it that just thirty minutes south of the safe, suburban Village of Wilmette lies one of the most crime-ridden and impoverished neighborhoods in America? Proponents of economic individualism believe that such racially segregated communities stem from the fact that some races simply work harder than others, enabling them to accumulate more wealth and, ultimately, afford a better lifestyle. This is clearly not the case. Unequal accumulation of wealth in the United States is the product of past and present racial discrimination that is prevalent in the housing market, not biological and cultural differences among races. While this outlook undermines the racist assumptions of economic individualism, it also poses a more challenging question: how can we make up for such discrimination?

Last November, the Housing Opportunities Development Corporation (HODC), a non-profit organization dedicated to the development of affordable housing in Chicago’s northern suburbs, proposed to build a 20-unit apartment building in Wilmette (Routliffe). When I asked Richard Koenig, the executive director of HODC, why he thought it was important to create affordable housing in Wilmette, he replied, “Diversity of all kinds, including economic, creates stronger, more vibrant communities. Affordable housing in Wilmette gives lower-income families an opportunity to live in a community with good schools and access to employment.” Here, Koenig addresses the need to provide lower-income families with the amenities that inner-city neighborhoods lack, such as educational resources and the ability to find jobs. In doing so, he highlights a key solution to balancing racial disparities in wealth, which is to ensure that all individuals, regardless of race or socioeconomic status, have the means to achieve success.

Despite the many benefits of creating affordable housing in Wilmette, the proposal was turned down after receiving opposition from Wilmette residents. When I asked Koenig why he thought Wilmette residents did not support the development of affordable housing in their community, he replied, “Opposition last year came from a variety of places, including misinformation, misunderstanding, and sometimes prejudice.” One particular prejudice was the belief that affordable housing would “bring people into the village who could be criminals” (Routliffe). Based on such a concern, it is evident that racial stereotypes continue to play a role in the segregation of communities.

When we view racial inequality as a result of biological and cultural deficiencies, we dissociate ourselves from the problem. Why should we be responsible for improving the standard of living for others when we had to earn our success? This perspective, however, is rooted in the misconception that disparities in wealth stem from differences in work ethic among races. In actuality, racial inequality in America stems from the unequal ability to accumulate wealth. Past and present discrimination in the housing market led to unearned advantages for some and unjustified disadvantages for others. So, while the rich got richer, the poor got poorer. Yet we disregard this reality, perpetuating the problem by failing to acknowledge and address the racial stereotypes that segregate our communities. It turns out, we are the ones who need a dose of reality.

Works Cited

Conley, Dalton. “Getting into the Black: Race, Wealth and Public Policy.” Political Science Quarterly (Academy of Political Science), vol. 114, no. 4, 1999, p. 595. Print.

Cornett, Brandon. “What Does an FHA Underwriter Look for During His Review?” FHA Handbook, 2016, Web. Accessed 1 Dec. 2016.

“Expanding Housing Choices in Chicago’s Northern Suburbs.” Housing Opportunity Development Corporation, 2016. Web. Accessed 1 Dec. 2016.

Hasenfeld, Yeheskel, and Jane A. Rafferty. “The Determinants of Public Attitudes Toward the Welfare State.” Social Forces, vol. 67, no. 4, June 1989, p. 1027. Print.

“The Federal Housing Administration (FHA).” U.S. Department of Housing and Urban Development, 10 July 2016. Web. Accessed 29 Nov. 2016.

Routliffe, Kathy. “Wilmette Affordable Housing Plan Draws Passionate Crowd.” The Chicago Tribune, 6 Nov. 2015. Web. Accessed 29 Nov. 2016.

Squires, Gregory D. “Demobilization of the Individualistic Bias: Housing Market Discrimination as a Contributor to Labor Market and Economic Inequality.” Annals of the American Academy of Political &Amp; Social Science, vol. 609, Jan. 2007, pp. 200–214. Print.