By RICHARD D. KAHLENBERGAUG. 3, 2017
ONE hundred years ago, in a major advance for human dignity, the Supreme Court struck down a racial zoning law in Louisville, Ky., that prohibited nonwhites from moving into homes in majority-white areas.
Laws like these, which existed in numerous cities at the time, are part of a larger, shameful history of government-sponsored racial segregation. In Buchanan v. Warley, the court ruled that such ordinances violate the 14th Amendment and related statutes that “entitle a colored man to acquire property without state legislation discriminating against him solely because of his color.”
But this hardly ended racial discrimination in housing, as whites adopted biased policies like economic zoning that banned apartment buildings in areas designated for single-family homes, often adding minimum lot size requirements to boot. Because African-Americans were disproportionately low-income, economic zoning was in effect exclusionary, accomplishing much of the same results as explicit racial zoning.
“Such economic zoning was rare in the United States before World War I,” Richard Rothstein of the Economic Policy Institute notes in his new book, “The Color of Law,” “but the Buchanan decision provoked urgent interest in zoning as a way to circumvent the ruling,” a ploy that would be used for decades. For example, as Mr. Rothstein notes, in 1953, shortly after about 250 African-Americans were transferred to work in a nearby Ford auto plant, the town of Milpitas, Calif., adopted a policy allowing the city council to ban apartments.
Developers challenged economic zoning in the courts, but with a different ultimate result. In the case of Village of Euclid v. Ambler Realty, a federal court struck down a zoning ordinance in a Cleveland suburb that prohibited apartment buildings in an area zoned for single- and two-family homes. The court noted that “the result to be accomplished is to classify the population and to segregate them according to their income or situation in life.”
But when the case reached the Supreme Court in 1926, the justices declared that excluding apartment buildings was constitutional. In language laden with class bias, the court reasoned that an apartment house can be “a mere parasite, constructed in order to take advantage of open spaces and attractive surroundings created by the residential character of the district.”
The Supreme Court’s comparative willingness to tolerate explicit economic discrimination is mirrored in American public policy. In 1968, in another great advance for human equality, the Fair Housing Act outlawed discrimination in the sale and rental of housing units by such factors as race, national origin and religion. But the law, like the Buchanan decision almost 50 years earlier, did nothing to address economically exclusionary zoning.
The differing treatment of racial and economic discrimination in housing laws has had a predictable result. Racial segregation by residence, while still high, is falling as the Fair Housing Act has allowed middle-class black people to escape ghettos. The black-white dissimilarity index (in which zero is perfect integration and 100 is absolute segregation), has shrunk from a high of 79 in 1970 to 59 in 2010, according to an analysis of Census data. Between 2000 and 2010-2014, black-white segregation declined in 45 of 52 metropolitan areas.
But in recent decades, as Robert D. Putnam, a political scientist at Harvard, notes in his book “Our Kids,” “while race-based segregation has been slowly declining, class-based segregation has been increasing.” In fact, Professor Putnam says, “a kind of incipient class apartheid” has been sweeping across the country. In 2015, in a panel discussion with Mr. Putnam, President Barack Obama observed that “what used to be racial segregation now mirrors itself in class segregation.”
Rising class segregation by residence is partly related to rising income inequality, but it is also the result of an expansion of exclusionary zoning. Research by Jonathan Rothwell, now at Gallup, and Douglas Massey, a sociologist at Princeton, has found that “a change in permitted zoning from the most restrictive to the least would close 50 percent of the observed gap between the most unequal metropolitan area and the least, in terms of neighborhood inequality.”
Exclusionary zoning frustrates the Fair Housing Act’s aim by erecting barriers that exclude millions of low-income African-Americans and Latinos from wealthier white communities. And growing numbers of poor whites are affected as well. As Paul Jargowsky, a professor of public policy at Rutgers University, notes, African-Americans and Hispanics remain much more likely to live in concentrated poverty than whites, but since 2000, there has been a 145 percent increase among non-Hispanic whites living in high-poverty neighborhoods.
Economic segregation matters because where you live affects so much in life — your access to transportation, employment opportunities, decent health care, and, most important, good schools. In Montgomery County in Maryland, which requires developers to set aside units for low-income families, disadvantaged students attending good local schools cut the math achievement gap with their middle-class peers in half between 2001 and 2007, according to a study by Heather Schwartz, a RAND Corporation researcher.
To bolster the 1968 Fair Housing Act, we need a new “economic fair housing act” to prohibit or discourage local ordinances that unnecessarily exclude people from entire neighborhoods and their schools. Given political realities in Washington, we could begin with laws in friendly states and build toward a moment, sometime in the future, when the federal government would take on the issue.
In its strongest form such a law would ban unjustified and pervasive exclusionary zoning laws that prohibit townhouses or apartments in single-family areas or impose minimum lot sizes. These ordinances, Lee Anne Fennell of the University of Chicago Law School notes, have become “a central organizing feature in American metropolitan life.”
If we can’t achieve a ban, we should assess a penalty on municipalities that engage in discriminatory zoning, either by withholding infrastructure funds or limiting the tax deduction that homeowners in those towns can take for mortgage interest. At the same time, inclusionary zoning laws of the type used in Montgomery County are needed to promote mixed-income housing.
There would, of course, be fierce political and legal opposition from many property owners in exclusive neighborhoods who have enjoyed an unwarranted inflation of their home values through social engineering of a particularly pernicious stripe. Economists across the political spectrum agree that current exclusionary policies create an artificial scarcity of housing, driving up prices beyond what the market would naturally dictate.
Research finds that racial diversity lowers residential property values. Therefore, exclusionary zoning also unfairly increases the property values in white neighborhoods by reducing the number of minority residents.
The flip side of the equation is that modest drops in property values to genuine market levels will be a boon to young and minority purchasers, as the elimination of unfair government restrictions makes housing more affordable.
Wealthy property owners usually win in American politics, but not always, as an important 2010 vote in Massachusetts suggests. Back in 1969, the state passed an “anti-snob” zoning law that empowered state officials to alter local zoning laws in communities where less than 10 percent of housing stock was deemed affordable. In 2010, an effort to overturn the law through a statewide referendum was opposed by 58 percent of voters.
And, in this populist moment, it is possible that interesting alliances could coalesce around an economic fair housing act. On the left, civil rights groups, affordable housing advocates and antisprawl environmentalists could ally with groups on the right, including libertarians who oppose government regulation on principle and developers who chafe at restrictions on building density. Primary beneficiaries would include Republican working-class white constituencies and Democratic working-class communities of color. The statute would be in the classic tradition of anti-discrimination laws, yet would radically reorder an exclusionary system that has been widely accepted as given.
Just as it is shameful for government regulation to exclude people from neighborhoods on the basis of race, it is similarly deplorable for local governments to exclude entire groups of adults and children from communities on the basis of income. We can either make this problem better and integrate more fully or we can let it worsen and allow our society to disintegrate further.
Richard D. Kahlenberg, a senior fellow at the Century Foundation, is the author of “All Together Now: Creating Middle-Class Schools through Public School Choice” and a new report, “An Economic Fair Housing Act,” from which this essay is adapted.
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