‘Minorities and immigrants were targets, not collateral damage of an experiment’

COMMENT The video of a black man gasping for air under the knee of a white police officer shook the world. George Floyd was killed in Minnesota, but his plea sparked protest that have extended from New York to Manchester and beyond. The protests are as much about cities as they are within cities. They highlight the failures of our built environment. And the failure of the property industry to enable more people to build wealth, access better jobs, and feel equal to their peers. More than a century after American independence, Britain exported an idea to the US: the suburb. As Robert Fishman points out in Bourgeois Utopias: The Rise and Fall of Suburbia, the decision of the upper middle class “in Manchester and the other early industrial cities in the 1840s” to move outside the urban core “created the basic structure of Anglo-American industrial city”. The suburbanisation of the US had an adverse effect on African-Americans. This was by design. To start with, the whole notion of suburbs was, in Fishman’s words, “based on the principles of exclusion”: the exclusion of working-class people, the exclusion of business, and the exclusion of dense urban structures. More than collateral damage But minorities and new immigrants were not simply the collateral damage of a modernist experiment in urban planning. They were an explicit target. America’s “Euclidean zoning” system favours detached family homes and discourages the mixing of uses. It gives wealthy homeowners the power to restrict the use of nearby land for more affordable housing. This system emerged in the early 20th century as a result of lobbying efforts by real estate developers, promotion agents, and affluent white residents. The name “Euclidean” does not come from its use of geometry to divide uses on a map; it comes from the town of Euclid, Ohio, whose government convinced the US Supreme Court that its residents have the right to exclude other people and uses. In the 1930s, the Federal Housing Authority was established as part of the New Deal and only made things worse. The FHA’s mandate was to standardise, finance and encourage the construction of more housing for working Americans. But it refused to guarantee mortgages for homes in minority neighbourhoods, relying on an infamous system of “redlining”. It did so regardless of the income levels of the applicants or the objective qualities of such neighbourhoods. Limited and exclusive Exclusionary housing and financing policies resulted in a whole generation of minority would-be homeowners who missed out on the opportunity of building wealth by owning a home in the suburbs. This same wealth enabled other groups to build a nest egg for retirement and put their children through college. The increase in housing prices since World War II means that whole areas of the country that were once affordable to working people are now limited only to wealthy residents. The impact is not restricted to the suburbs. In New York and elsewhere, existing homeowners use the zoning code to restrict the construction of more housing units, making cities less affordable to newcomers and existing residents who are not wealthy. As a result, more than 150 years after the abolition of slavery, America’s cities and towns are still highly segregated. I am no expert on the situation in the UK, but a quick search uncovered dramatic discrepancies in home ownership rates by race, reports of efforts by wealthy homeowners to prevent the construction of new housing units in their vicinity, a history of discrimination in schools, workplaces and more. Even if the history of American and British cities is different, they face similar challenges in the future. The biggest one among them is how to handle the impact of technology on urban labour markets. Covid-19 has shown that our cities are dependent on “essential workers” — most of them in the service industry. A contactless future At the same time, this dependence is also expediting the development of new ways to automate such service jobs or reduce any interaction with service workers to a minimum. Cashless payments and contactless deliveries are harbingers of a future in which access to many urban services will no longer require any interaction with many urban residents. This does not mean people will no longer live in cities. But it does mean that, by default, there will be fewer opportunities for people from different socio-economic background to interact with each other. But the default option is not the only one. We can build cities that expand access to housing and employment opportunities, that allow even the not-yet-wealthy to own a home and build wealth, and that allow children of all colours and creeds to grow up together, to see each other as equals, and to keep building their own version of tomorrow. If the events of the past few months have a silver lining, it is the fact that we now know that our tenants and customers have a choice: a choice of where to work, a choice of where to live, and a choice of where to shop. This is a challenge to the basic assumptions behind the value of buildings and the priorities of those who design, build, and operate them. But this new level of choice also extends itself to the property industry. Releasing the built environment from the old constraints of geography and tradition means we are free to think differently about what, where, and how we build. The market will reward bold ideas. We have a unique opportunity to reshape the world. Let’s go. Dror Poleg is the author of Rethinking Real Estate