Economy

Baltimore’s Economic Devastation Goes Back To Racist Housing Policy

CREDIT: AP Photo/Alex Brandon

Protests in Baltimore on Saturday, April 25.

While the uprisings in Baltimore stem perhaps most directly from a long history of unchecked police brutality, sparked by the death of Freddie Gray in policy custody, it also comes in a city that has long suffered economically. Today, the city’s unemployment rate is about 8.5 percent, compared to a national rate of 5.5 percent. It has a 24 percent poverty rate. The city’s median income is $41,385, compared to a median income of $73,538 for the state of Maryland.

There are stark racial differences in these numbers, too. The share of the city’s employed black men of working age dropped 15 percent between 1970 and 2010, while white men only saw a drop of 4.2 percent. By 2013, less than 60 percent of black men ages 25 to 54 were working, compared to nearly 80 percent of white men. Black Baltimore county residents earned a median income of $58,131 in 2013, compared to $68,112 for white people.

There are many causes of a city’s economic decline, and much of Baltimore’s job loss is tied to the falling fortunes of the manufacturing sector. But the fate of the city’s black population has much to do with deliberate policy choices related to housing.

Their history goes back to the 1900s. As Garrett Power, a law professor at the University of Maryland, writes, Baltimore’s mayor signed an ordinance in 1910 banning black people from moving to majority-white blocks and white people from moving to majority-black ones. The city solicitor gave it the green light constitutionally “because of irrefutable facts, well-known conditions, inherent personal characteristics and ineradicable traits of character perculiar [sic] to the races.” The mayor signed a broader segregation ordinance in 1911, “the first such law to be aimed at blacks in the United States,” Power notes.

While this kind of ordinance was struck down by the Supreme Court a few years later, another mayor pursued housing segregation by having the Real Estate Board of Baltimore, the City Building Inspector, and the Health Department cite anyone who rented to black people in white neighborhoods for code violations. The city created a Committee on Segregation that organized neighborhood associations to come together and sign racially restrictive covenants barring people from selling to black homeowners.

Housing segregation was also helped along by federal policies. The Federal Housing Association, a New Deal housing program, redlined neighborhoods by race, refused to insure mortgages for black families moving to white neighborhoods, and barred developers from federally subsidized loans if they didn’t exclude black families. The Home Owners’ Loan Corporation, another New Deal program that insured mortgages, also redlined, assuming that black neighborhoods would lose value and using racial makeup as a key factor when rating neighborhoods’ security. These policies kept black people from getting cheaper, subsidized loans, barred them from moving to certain areas, and helped to depress property values in the neighborhoods they could live in.

Thanks to all of these policies, by the 1930s black people made up 20 percent of the city’s population but lived on just 2 percent of its land. There was huge demand for more housing, but in the 1950s the city gave in to racial fears and restricted the building of public housing to “slum sites,” not in the wealthier, predominantly white neighborhoods. This was also paired with the clearance of a good deal of public housing, and fewer units were created where black people could live than were torn down.

Segregation meant that the city’s black population was constrained, while white people began to leave for the suburbs. The city lost a third of its population between 1950 and 2000. They were able to move out particularly when the jobs began to dry up in the 1970s — the city’s population fell 13 percent between 1970 and 1980. That depopulation was a big factor in the city’s downward economic spiral. As Jamelle Bouie writes at Slate, “White flight means a smaller tax base and fewer resources for improvement; industrial collapse means fewer jobs; crack and violence means a generation of “missing” black men, in jail or in the ground; a culture of police violence means constant tension with the policed.” Today, black people make up less than a third of Maryland’s population but two-thirds of Baltimore residents.

And the effects of redlining in the 1930s linger. Today, the affected neighborhoods in the city still have higher poverty rates, lower homeownership rates, and fewer college degrees. Meanwhile, in the lead-up to the housing crisis, the lack of housing mobility for the city’s black residents made them a target for subprime lenders. That led to one of the highest foreclosure rates after the market crashed.

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CREDIT: Dylan Petrohilos/ThinkProgress

The Baltimore riots of 1968, sparked by the assassination of Dr. Martin Luther King, Jr., were later found to have been spurred by “white racism” and economic oppression. Little has changed today. It is one of the more racially segregated cities in the country. The number of high-poverty neighborhoods in the city has increased since 1970.