Some of My Best Friends Are Black

by Tanner Colby

  Prominent in the group was J. C. Nichols’s close friend Robert Jemison of Birmingham, Alabama. In 1924, Jemison wrote Nichols that he was planning to build Birmingham’s own premier, high-class development and asked if Nichols could, “at his earliest convenience,” send templates for “the latest form of deed and restrictions, with the proper provisions for maintenance.” Nichols was more than happy to share. Shortly thereafter, Jemison broke ground on his own “Country Club District.” He called it Mountain Brook. It was a carbon copy of the Kansas City original—right down to its shopping village, built just for the automobile. In 1947, inspired by Jemison’s success, a developer named Charles Byrd went south of Mountain Brook and bought up the ostentatious estate of a recently deceased eccentric. Byrd chopped it up, cordoned it off for white folks, and called it Vestavia Hills.

  The High-Class Developers conference included New York City’s John Demarest, Detroit’s Judson Bradway, Baltimore’s Edward Bouton, Dallas’s Hugh Prather, San Francisco’s Duncan McDuffie, Omaha’s J. E. George, Indianapolis’s Emerson Chaille. Like Jemison, these men would all leave the conference each year and put their ideas to work. Self-perpetuating restrictive covenants soon found their way into Bloomfield Estates outside Detroit, Highland Park north of Dallas, St. Francis Wood in the heart of San Francisco, and many other high-end subdivisions—plus all their Vestavian imitators—north and south, east and west.

  Together, these High-Class Developers made up the brain trust of the National Association of Real Estate Boards (NAREB), one of the most powerful trade associations in the country. Nichols and the others rotated through the presidency and other high-ranking offices, each gentleman taking his turn. Not by coincidence, in 1924 NAREB made racial discrimination official policy, updating its code of ethics to say, “A Realtor should never be instrumental in introducing into a neighborhood… members of any race or nationality… whose presence will clearly be detrimental to the property values of that neighborhood. Like termites, they undermine the structure of any neighborhood in which they creep.”

  All of which was legal.

  In 1916, the city of Louisville, Kentucky, had passed a zoning ordinance delineating where blacks could and could not live. In Buchanan v. Warley, the NAACP challenged the law, taking their petition all the way to the Supreme Court, which ruled in their favor. The court’s opinion cited Louisville’s ordinance as a public infringement on private property rights. Ten years later, when the issue of private racial covenants came before the court in the case of Corrigan v. Buckley, the justices held that said covenants were legitimate and binding; they represented an arrangement between a private buyer and a private seller, which was not the government’s business. The combined effect of these decisions, as pointed out in the Kansas City Call, was to say that cities and states could not violate blacks’ property rights, but with restrictive covenants, private citizens could unilaterally take those same rights away with nothing but a pen and paper and a trip to the notary public. Soon, thanks to the public-private partnership, the distinction between government policy and corporate policy would cease to matter entirely.

  The Great Depression nearly killed the residential gold rush. In its first four years, the number of permits issued for new home construction fell by 93 percent nationwide. But out of this crisis came suburbia’s great leap forward.

  In 1932, as the economic disaster showed no signs of abating, the Hoover administration passed the Federal Home Loan Bank Act. Its goal was to stimulate home building and home buying through government-backed, long-term amortized mortgages,* as well as housing subsidies to stimulate private developers. In 1933, Roosevelt’s New Deal extended Hoover’s efforts by establishing the Home Owners’ Loan Corporation (HOLC), tasked to determine the creditworthiness of home owners the government helped to finance. Roosevelt then chartered the Federal Housing Authority (FHA), whose task was to issue and administer loans and subsidies based on those assessments. And since most politicians aren’t experts in land development, they turned to those who were: the National Association of Real Estate Boards and its most prominent representative.

  J. C. Nichols was so intimately involved with the formation of the FHA that he was called to consult privately with FDR in the Oval Office. When America’s housing policy was drafted, whole chunks were lifted straight out of the Nichols Company handbook, practically word for word. Through the HOLC, the federal government developed a four-tiered classification system for neighborhoods: high-end, all-white neighborhoods were given the highest rating; white working- and middle-class neighborhoods were given a secondary rating; Jewish and ethnically mixed areas were rated third; and the lowest possible rating was given to black neighborhoods—regardless of the quality of the housing stock or the income of the inhabitants. Then the HOLC went through every block on every map of every city in America, giving each neighborhood a color-coded designation. Black neighborhoods were coded red.

  The four-tiered rating system devised by the HOLC had been intended as a metric to assess credit risk and therefore assign a proper rate of interest, but black neighborhoods were not simply assigned higher interest rates. They were not assigned anything. In a process that became known as redlining, the FHA cordoned off black neighborhoods and designated them wholly ineligible for federal subsidies and mortgages. According to the federal law of the United States, a black person anywhere was now a threat to property values everywhere. This was a policy based on nothing more than the say-so of the men who stood to profit from it.

  Once the FHA guidelines were in place, private lending institutions adopted them as their standard, too. So did insurance companies. If the government was unwilling to cover the risk, why should they? Once a neighborhood was redlined, residents found it virtually impossible to get any kind of legitimate mortgage, home owners’ insurance, or home improvement loan, even if those instruments weren’t federally insured. Inevitably, the legal embargo against fair lending in redlined neighborhoods sped the growth of predatory lending; blacks could get mortgages, but usually at grossly inflated rates and with no consumer protections against fraud.

  During the late 1930s and early 1940s, though still hampered by the Depression and World War II rationing, new home construction made a slow and steady return. FDR’s New Deal had laid the groundwork for the ultimate public-private partnership: an endless river of construction subsidies and federally backed mortgages, issued with almost no oversight and minimal preconditions. In fact, the only real restriction on FHA monies was that they be used in racially homogenous neighborhoods. The FHA’s official underwriting manual explicitly directed its agents to grant subsidies and back mortgages only in areas protected by restrictive covenants. “If a neighborhood is to retain stability,” the manual stipulated, “it is necessary that properties shall continue to be occupied by the same racial and social classes. A change in social or racial occupancy generally leads to instability and a reduction in values.” In the suburbs, it became completely irrelevant that the government couldn’t impose racial zoning laws. Cities no longer planned themselves—corporations did most of the work. Thanks to the FHA, private developers had access to billions of dollars in nearly risk-free capital, which allowed them to buy up vast tracts of land and operate them as they saw fit, with a unilateral say on what could be built and who could live in it.

  As the veterans of World War II returned home and the baby boom took off, America’s High-Class Developers shifted gears and started cashing in on the surging demand for middle-class housing. The “refinement of the suburban estate” was no longer a luxury for the well-to-do; it was a mass-produced consumer good for everyday use. Developers built two- and three-bedroom starter homes, identical Cape Cods and ranch houses stamped out block after block. America had started to sprawl.

  In 1947, the developers of Long Island’s Levittown perfected an assembly line technique for home building. FHA subsidies enabled them to clear a bunch of empty potato fields and start plopping down houses at a rate of thirty per da
y. Outside Los Angeles in 1950, the entire town of Lakewood simply rose up in a matter of months out of an old 3,300-acre lima bean farm. And in Johnson County, Kansas, just adjacent to the million-dollar mansions of Mission Hills, J. C. Nichols opened up Prairie Village, an everyman’s Country Club District of modest homes with all the modern conveniences. Nichols even updated his sales pitch for the Cold War generation. “When you rear children in a good neighborhood,” he told a reporter from Time magazine, “they will go out and fight communism.”

  After the war, the heroes of Normandy and Okinawa were duly rewarded by their country. The GI Bill gave low-interest, zero-percent-down mortgages to all returning servicemen—a chance to buy a piece of the American Dream. John and Jane Veteran came home from the war and flocked to suburbia, racing to grab their slice of white-picket paradise. At least, that’s what America likes to believe about itself. In truth, GI loans were simply FHA loans by another name, subject to the same redlining restrictions. When the whites of the Greatest Generation went looking for a place to call home, it was all but illegal for them to buy a home in a subdivision that didn’t exclude blacks. Realtors didn’t show white people anything else, because their money wasn’t any good anywhere else. Black veterans, on the other hand, could use their housing vouchers only in all-black areas; even with the GI Bill, many were still denied loans.

  By 1950, new houses in America were going up at an average rate of four per minute, 75 percent of them in the suburbs, and nearly half of them bought under the GI Bill. By 1960, the population of Levittown had gone from zero to 80,000, all of it white. Lakewood, California, had gone from zero to 67,000, all of it white. And in 1960, Prairie Village, Kansas, was home to just over 50,000 white people. Some form of racial restriction was used in over 50 percent of all subdivisions nationwide. They were so pervasive that when the Supreme Court finally ruled on the matter again, in 1948’s Shelley v. Kraemer, three of the justices had to recuse themselves because they lived in restricted neighborhoods. So it was by a vote of six to zero that the court finally struck them down.

  But the court’s narrowly written opinion didn’t say that racial covenants couldn’t be used, just that they were not enforceable in a court of law—and good luck finding black home owners willing to take that issue to trial in the late 1940s. In the Kansas City metropolitan area, more racial housing covenants were used in the decade after 1948 than in all four decades prior. The last one was written in 1962. The residential color line in suburban Johnson County would not be broken until 1965.

  In the history of race, slavery and segregation are always called out for what they did to blacks’ human and civil rights. Redlining and racial covenants never seem to get the same amount of play, despite the damage they did to blacks’ property rights. Slavery and segregation can’t be kept out of the history books; they’re too big. But the story of real estate is buried in the ground, so it’s easier to pretend it never happened. We get to act like all that money out in the suburbs came from nothing but honest, American hard work, and not a big, fat, racist handout from Uncle Sam.

  The suburban landgrab of the twentieth century was one of the single greatest engines of wealth creation in human history. It took a country of second- and third-generation white-ethnic immigrants, vaulted them into the middle class, and sent all their kids to college. In 1946, you could buy a brand-new Prairie Village starter home for $6,000. That same home is worth around $375,000 today, which, adjusted for inflation, represents a return of well over 500 percent.

  J. C. Nichols died in 1950, but his plan for permanence lives on. His racial covenants are still with us, auto-renewing year after year, like some horrible gym membership we’ll never get out of. Illegal and unenforceable, yes, but they can’t be stripped out. Not without the unanimous, notarized consent of every single member of every single home owners’ association collected and filed five years ahead of the original deed’s renewal date. A report by the Kansas City Star in 2005 found racial covenants still on the books in more than a dozen Country Club District developments. Acreage-wise, the Country Club District is the largest contiguous parcel of land ever developed by a single company in the history of the United States. As of the mid-1990s, the Nichols Company’s assets were valued in excess of $500 million.

  For blacks, however, the good times were not nearly so good. Between 1908 and 1948, racial covenants were used to exclude them from 62 percent of all new housing developments in Jackson County, Missouri (home of Kansas City proper). During that same period, racial covenants had excluded them from 96 percent of all new housing developments in Johnson County, Kansas. And between 1934 and 1962, the Federal Housing Authority backed mortgages for more than 77,000 homes in the Kansas City area; less than 1 percent of those loans went to blacks.

  And they could have used them. In 1945, a survey showed that 85 percent of housing inhabited by blacks in Kansas City was substandard or borderline uninhabitable. By 1950, the black population of Kansas City had more than doubled once again, to more than 55,000. Eighteenth and Vine was bursting at its seams, yet it had expanded by only a few blocks to the east. There was nowhere for black people to go. Pretty soon, Bob Wood would show up knocking on their door, and he’d make them an offer they couldn’t refuse.

  * Ironically, before the election-year fearmongering began, local black leaders had been thinking of throwing their support to the Democrats. Decades of loyalty to the Party of Lincoln had yielded them only a token amount of civic patronage, no real economic progress, and a lot of empty promises; many blacks were starting to get frustrated that their political voice was beholden to a single party that took them for granted. (Some of this may sound familiar.)

  * It is not known who first came up with the idea to include an owner’s race in a property’s zoning requirements, nor can anyone pinpoint where the first such clause was actually written into a contract. The first verifiable use of explicit racial restrictions against blacks has been traced back to 1908, in Baltimore’s Roland Park and in Kansas City’s Country Club District.

  * The older, working-class houses east of Troost were built with these kinds of limited property restrictions, part of the reason they were more vulnerable to blockbusting.

  † Meaning a minority of voters with large lots could quash a majority of voters with smaller lots.

  * Prior to this point, there had never been any federal mortgage insurance of any kind, no Fannie Mae or Freddie Mac; without federal backing, new home purchases had required something on the order of 50 percent down just to walk in the door.

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  49/63 or Fight

  Susan Kurtenbach was still a young girl when the first black family moved to her neighborhood. It was in 1969, or maybe 1970. The Kurtenbachs were a working-class Catholic family. It was Susan, her parents, and her two older brothers, and they lived in the 5100 block of Lydia Avenue in a little tree-lined pocket neighborhood called Troostwood. Troostwood was right on the wrong side of the Berlin Wall of Kansas City, and Lydia Avenue was on the most vulnerable, easternmost frontier. Looking out Susan’s backyard, just a block across Paseo, was Norman Roetert’s Blue Hills, the neighborhood that was currently “in transition.”

  At the time, Kansas City had thousands of hardworking black families in need of good housing. The first black family on Susan Kurtenbach’s block was not one of them. “They moved onto Paseo,” she says, “right behind us, a couple houses up. They would have been unpleasant in any neighborhood. They would throw raw garbage out in the backyard. Back then, this was a place with families, with a lot of children, and the pestilence problem it created was really of concern. They put their old toilet out in the back. The parties they would have and the arguments they would have, the domestic violence and the police being called—that didn’t happen in this neighborhood.”

  That a family such as this would find its way into a place like Troostwood seems unlikely, but they didn’t wind up there by accident. That particular family was put in that particular house to scare
white people, and the man who put them there was Bob Wood. “It was quite purposeful and quite disturbing,” Susan says, “and it was very effective.”

  Much like Kansas City’s more celebrated real estate man, Bob Wood didn’t sell houses. Where J. C. Nichols offered the promise of desirable associations, Wood spread the fear of undesirable associations. Nichols built the supply. Wood stoked the demand. One of these men had a standing invitation to the White House, the other lurked in slums and back alleys, but neither could have succeeded without the other.

  Between 1950 and 1970, the white population in Kansas City’s southeast corridor fell from 126,229 to 33,804. In those same two decades, the black population rose from 41,348 to 102,741. Nineteen census tracts lay in the blockbusted path from Eighteenth and Vine down to Blue Hills. All of them were now over 90 percent black. Bob Wood had run right over Norman Roetert, and now he was coming to Susan Kurtenbach’s house. Troostwood would be the next domino to fall.

  Only it didn’t.

  Ed and Mary Hood moved to Kansas City in 1969. Ed had been offered a teaching position at the law school of the University of Missouri–Kansas City (UMKC). Both native Iowans, the young couple had spent the late sixties soaking up the spirit of the times, living in New York’s downtown bohemia, spending the ’67 Summer of Love in San Francisco, and then settling in to raise a family up the coast in Oregon before getting the call from UMKC. Not knowing the Kansas City area at all, they asked the university for some assistance in locating a house.

  “The only thing we got back,” Mary Hood says, “was this glossy, full-color brochure with the title ‘Beautiful Johnson County.’ We looked at the map and saw it was way out away from everything and we were like, ‘Why would we want to live there?’