From Watts to Ferguson: Learning from Our Past

The violent protests that erupted after the grand jury refused to indict Ferguson, Mo., police officer Darren Wilson launched a new round of debate about how white police interact with African Americans. But the problems laid bare by the current unrest go much deeper than police attitudes and tactics.

If Americans of goodwill want to understand the most fundamental lessons of the Ferguson situation and the angry response to the grand jury report, they have to look much more closely at social and economic issues that don't provide visuals for the TV cameras. They have to look at issues that cut far closer to home, and I mean that literally.

The truth is that America is increasingly divided between affluent, largely white communities and poor, largely African American areas, with less and less opportunity for people in the latter areas to move to the former. We are steadily becoming a country composed of two societies that are separate and unequal, one white and the other black.

This is largely because of the failure of our housing and mortgage markets, and the inept response from state and federal governments. Housing costs are increasing far faster than incomes for most Americans, but especially for minorities. Where jobs are not being created and housing costs are not rising, a new wave of decay, disinvestment and despair is taking hold, possibly for a long time to come.

The foreclosure crisis was hard on Americans of all races, but it was a disaster for communities of color. These areas, including Ferguson, were devastated by predatory lending and high rates of foreclosure as well as a high incidence of "negative equity," in which a home has a lower market value than the principal balance that is still owed on the mortgage loan.

In the zip code that includes Ferguson, 49 percent of homes are "underwater," another term for having negative equity at the end of 2013, according to "Underwater America," from the Haas Institute for a Fair and Inclusive Society at the University of California, Berkeley.

Nationwide, about 27 percent of homeowners in minority areas had negative equity compared to about 15 percent of owners in white areas, according to "The State of the Nation's Housing 2014," from the Harvard Joint Center for Housing Studies. In minority neighborhoods, the average decline in home prices from 2006 to 2013 was 25 percent, according to the report. That's roughly three times the decline experienced in white areas.

The problem is compounded by the overreaction to the foreclosure crisis, which resulted in denial of mortgage credit to aspiring first-time homebuyers, along with lingering high unemployment and wage stagnation. The rate of homeownership among black households, a key measure of upward mobility, declined to 42.9 percent in the third quarter of 2014, far lower than the rate 72.6 percent for non-Hispanic whites, according to the Census Bureau.

When it comes to housing, the deck is stacked against minorities and all people with lower incomes. Our system of land use and building regulation drives up housing costs, making decent homes and apartments harder for them to afford. What's worse, it allows affluent communities to obstruct development of housing that's made relatively affordable by the provision of government subsidies -- a thinly veiled way to keep minorities out of their towns.

As one affordable housing advocate put it, communities of opportunity -- with jobs, good schools and safe streets -- have become like private clubs where minorities are not welcomed.

With all the recent discussions about growing income inequality, it's time to recognize that housing affordability and the mobility of lower-income households are crucial factors in their ability to move up economically and narrow the income gap.

In 2015, it will have been 50 years since our country saw the start of a series of race riots that had the president and Congress wondering if we were on the verge of a race war.

The trouble started in the summer of 1965 when a traffic stop in the Watts section of Los Angeles triggered six days of rioting, resulting in 34 deaths and destruction of or damage to hundreds of buildings.

This was followed by riots in other cities, including Cleveland in 1966 and Newark in 1967. In 1968, after the assassination of Martin Luther King, Jr., rioting broke out in dozens of cities. The good news is that these upheavals prompted President Lyndon Johnson to push Congress and state officials to face up to the underlying conditions that primed the inner cities for explosions of violence and anger.

In September 1965, Congress created the Department of Housing and Urban Development. In 1965 and again in 1968, it enacted an extensive array of government programs to build affordable housing and revitalize our cities. It passed the Fair Housing Act, which prohibited discrimination in the provision of housing.

The bad news is that there's a powerful political movement to stop funding many housing and urban development programs. Many have already been slashed or eliminated, including the transformative HOPE VI program for redevelopment of our most decayed public housing projects.

While budget cutters attack government subsidy programs, opponents of affordable housing are working hard to roll back and obstruct the fair housing laws that obligate localities to allow construction of housing that low-income minorities can afford.

In my new book, Rebuilding a Dream, I point out that we have a tremendous track record of successfully addressing housing and urban problems. What we need now is the political will to keep investing in programs that work -- and new ideas that require political courage at the local level and smart policies, such as tax incentives, at the federal level.

My book warns that continued steps backward will exacerbate inequality and create more anger and mistrust -- conditions that could bring a new wave social upheaval. (For info on the book, go to

Even as our population is becoming more diverse, our communities are becoming more segregated. "Arrested progress in the fight against poverty and residential segregation has helped concentrate many African-Americans in some of the least desirable housing in some of the lowest-resourced communities in America," according to a 2013 report from the Economic Policy Institute (EPI).

Nearly half (45 percent) of poor black children live in neighborhoods with concentrated poverty, but only a little more than a tenth (12 percent) of poor white children live in similar neighborhoods, EPI said.

The observation at the start of this commentary that America was increasingly divided into two unequal societies, one black and one white, was taken from the report of the Kerner Commission, which was appointed to look at the reasons for the urban unrest of 1968.

For the past half-century, we've made progress bridging the gaps between the races and addressing inequality. If we don't want history to repeat itself, we cannot stop now. We must tell Congress to stop cutting successful housing and urban programs. On the contrary, it must restore funding cut over the last several years.