The residential segregation that is pervasive in the United States today was partly created by explicit federal policies

See America’s Federally Financed Ghettos. NY Times editorial. Excerpt:

"the residential segregation that is pervasive in the United States today was partly created by explicit federal policies that date back at least to World War I. It is now widely acknowledged that the federal insistence on segregated housing introduced Jim Crow separation in areas of the country outside the South where it had previously been unknown. It stands to reason that dismantling a system created by a set of government policies will require an equally explicit set of federal policies.

The scholar Richard Rothstein exposed the roots of this shameful process in his recent book “The Color of Law: A Forgotten History of How Our Government Segregated America.” He reported that the government’s first effort to build housing for defense workers near military installations and factories during World War I was founded on the premise that African-American families would be excluded “even from projects in northern and western industrial centers where they worked in significant numbers.”

The same toxic pattern prevailed under Franklin Roosevelt’s New Deal, when the government created the first public housing projects for nondefense workers, building separate projects for black people, segregating buildings by race or excluding African-Americans entirely. Particularly telling is the fact that racially integrated communities were razed to make way for Jim Crow housing.

The federal insistence on rigid racial separation found its most pernicious expression in the Federal Housing Administration, created in 1934 to promote homeownership by insuring mortgages. As the sociologists Douglas Massey and Nancy Denton document in “American Apartheid: Segregation and the Making of the Underclass,” the government typically denied mortgages to African-Americans, shutting out even affluent black people from the suburban homeownership boom that remade the residential landscape during the middle decades of the 20th century.

Government at all levels embraced racial covenants that forbade even well-to-do African-Americans from purchasing homes outside of black communities. Cut off from homeownership — the principal avenue of wealth creation — African-Americans lost the opportunity to build the intergenerational wealth that white suburban families took for granted. The vast wealth gap that exists today between whites and African-Americans has its roots in this era."