About "White Flight"...

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Apr 18, 1998, 3:00:00 AM4/18/98


Lesson Seven

Yggdrasil says:

"As evidence of exploitation, we have discussed governmental race
preferences. They are merely the tip of a very large iceberg. Economic
exploitation of European-Americans is big business.

"Governmental race preferences in the United States are the symbolic and
official confirmation of a much larger underlying economic reality."

Imagine yourself an impartial visitor from an isolated civilization
studying the United States.

The popular press and politicians recite that majority
European-Americans exploit and oppress people of color. Yet people of
color, by the boatloads and by the hundreds of thousands, are clamoring
to get into the U.S. If the word "oppression" has any meaning, you would
expect that people of color would be moving in the opposite direction.

The popular press claims that European-Americans exploit and oppress
people of color. Yet tax dollars, on balance, flow disproportionately in
the other direction - from European-Americans to people of color.

U.S. history texts and Supreme Court opinions state that majorities
always oppress and exploit minorities. And yet, if the proverbial
visitor from an isolated civilization were to pick a group to exploit
based on economic motives, the visitor would choose the group that is
the most productive and the most numerous. After all, that is where the
money is.

The popular press constantly excoriates rich "WASPs" (or European-
American Protestants) as the prime movers in this exploitation of people
of color. Yet when you measure actual income and education levels, you
find out that Jews are the most prosperous ethnic group, followed by
Japanese and Chinese Americans. European-American Protestants rank below
European-Americans of Italian, Polish and Irish descent, and are only
marginally above African-Americans.

Many civilizations have their myths. Ancient Greeks and Romans were
taught, and perhaps believed, that their secular rulers were descended
from gods.

But the myths which America recites every day are contrary to easily
observable fact. Any myth that is contrary to clearly observable fact
must be very important to the elites it serves. For such a myth takes a
great deal of energy to sustain, and can serve as grounds for dangerous
rebellion when overthrown.

In this lesson we will "deconstruct" the housing industry in the United
States. Many readings could support this lesson. But the attached
article, "Marquette Park" has such unique power that it deserves to
stand alone, with no distractions.

Housing and automobiles, with their ancillary industries such as
furniture, appliances, carpets, oil and auto repair, account for about
half of our GDP.

Much of that GDP growth following WW-2 has been driven by the creation
of suburbs, led by pioneering builders such as Kaufman & Broad.

Initially, this boom in residential construction was fed by demand from
returning veterans following the War. Although this boom has continued
more or less unabated through the present, its character changed
significantly in the early 1960s.

The building industry in California faced boom times not only in the
50's, but continuing on into the 60's and 70's from a wave of migration
from other states.

But as the 60's arrived, the building industries in the Midwestern and
Eastern cities were faced with a mirror opposite of the California
image, - static or very slow growing populations with little real demand
for new suburban housing.

Once pent up demand was satisfied in the 1950's, new sources of demand
had to be created. Many Americans were perfectly happy living in
charming, older ethnic neighborhoods in these Midwestern and Eastern
cities. The builders needed a way to make these people unhappy with
those neighborhoods.

To generate continued demand for more and more suburban housing
developments, the developers needed "white flight".

As if by happy coincidence, the 60's obliged, with race riots and
busing. The popular press (the same press whose coffers were filled by
revenue from ads for new housing developments) presented European
Americans with a new image of the angry and violent African-American.
European-Americans fled their old neighborhoods in droves.

The first to move into suburbs did very well. Prices tended to rise in
the first 5 years of a development's life. However, those who lacked the
means to flee to the suburbs, did very badly, and that is what this
week's reading is about.

In the 60's, HUD began its program of "urban renewal". HUD tore down
housing in center-city ghettos and replaced that housing with freeways
and offices, as well as a few scattered housing projects. The Nobel
Prize winning economist, Milton Friedman, referred to the program as
"Negro removal".

These displaced African-Americans took the federal money they received
for their old homes and went shopping for homes in the surrounding
ethnic neighborhoods and older suburbs. Each wave displaced by "urban
renewal" prompted a whole new wave of "white flight".

With the welfare system producing increased rates of illegitimacy and
escalating crime rates, the stage was set to keep the whites moving and
the economy growing for quite some time. Billions were made in profits.

Meanwhile, in California, as real estate prices escalated in the late
70's and the migratory rush from other states slowed down, the housing
industry discovered a new and more powerful catalyst for white flight,
illegal immigration.

In Southern California, the creation of suburbs reached its logical
extreme. Developers created new cities of tract housing and sold it to
middle class European-Americans. The developments were so dense that
once urban decay gained a toe-hold, the entire city turned very quickly.
Within the space of 15 years, new suburban cities in Orange County and
the San Fernando Valley have come full circle, with stories of declining
schools, crime and gang wars cropping up in their local papers.

White flight has created a lifestyle in which commuters spend three
hours per day on the freeways, while every last penny of their income is
tied up in mortgage payments for small, flimsy houses that would be a
laughing stock in other parts of the country. These suburbanites have no
disposable income and no time to read or organize to change the system.
They have no time to create or maintain their own culture. The only
thing they have is their TV sets, telling them to be happy and keep on
spending. They are indeed modern serfs.

Above the vast herds commuting to work on the freeways, one can spot on
the bluffs of Beverly Hills and Newport Beach, developers in their
Mercedes with their cellular phones putting together the next deal in
between month-long vacations. It is the Wild West writ large, but with
European American suburbanites as the cattle. The developers build,
while the politicians, the press and the illegal immigrants just "keep
em movin'."

The profits are personalized, the costs, socialized.

The process drives the better half of our GDP, and produces much of our
government's tax revenue.Dependent on permits and
zoning variances, the housing industry almost singlehandedly funds the
campaigns of local county and city politicians. These local politicos
learn early that

Voters may believe these plans are real. But variances and amendments
allowing higher densities are the strokes that keep the mother's milk of
campaign contributions flowing, and set the tripwires for rapid
neighborhood change. It is a splendid training ground from which to
graduate to Congress, where border guards and immigration laws are also
for public appearances.

Without drugs, violence, and urban decay, white flight might slow. That
would sour the economics of housing construction, and the press,
advertising and political industries it supports. Our welfare system
subsidizes pathologies which our housing industry needs. Unchecked
illegal immigration fuels the fire.

Academics write countless books about the destructiveness of welfare.
What they fail to recognize is who wins and who loses. The collateral
consequence (white flight) of a senseless policy (aid to dependent
children) is much more significant than the direct consequence (urban
decay) and is the real reason that the seemingly senseless policy
persists. Follow the money flows and you will arrive at the truth!

White flight channels energy and productive effort in directions that it
might not otherwise flow. It renders urban mass transit impractical,
stimulating vast demand for automobiles and the oil to run them. It
stimulates enormous amounts of debt creation, and economic stimulus. It
channels virtually all middle class wealth and savings into suburban
housing and automobiles. Policies of moderate inflation turn this
excessive consumption by the European-American middle class into what
feels to them like investment.

This excessive consumption renders the European-American middle class
utterly dependent on their jobs for survival, and utterly unwilling to
think or speak thoughts that might be unpopular with the boss, or a
potential customer.

Small wonder that the social policies driving white flight become moral

The article below is about the fate of those European-Americans who are
the last to leave their decaying neighborhoods. It is a classic of the
journalistic art.

Yggdrasil recommends that you read the following:


Mar. 2, 1977 Wall Street Journal p. 16
Racial Change in Marquette Park


CHICAGO--The Marquette Park neighborhood on this city's southwest side
has long been a prototypical white ethnic enclave. Named for the
pleasant park in its midst, the neighborhood has been a haven for waves
of European immigrants--Germans, Irish, Poles and most recently
Lithuanians--each of which has left its stamp on the area's architecture
and stores.

It's a place where old world values are unashamedly embraced. Families
are close-knit and suspicious of outsiders. Their modest brick bungalows
and woodframe houses are painted every two years whether they need it or
not. The weekly visit to deposit money at the savings and loan
association takes on the trappings of a sacrament.

The future of the community is bleak, however. Chicago's relentlessly
expanding black ghetto has engulfed the eastern fringe of the
neighborhood. Petty crime and building abandonments are already a
problem in the transition zone. Property values are falling. A & P and
other major stores there have moved out. Jobs are fleeing to the

Here as in many working class white communities in other cities the
overriding issue is race. For increasingly in recent years whites are
being pushed out of communities where they have long lived because of
racial change and the rise in crime and blight which often accompany it.
Those whites who can afford to typically flee to the suburbs and the
protection that higher property values and restrictive zoning laws
afford. Others either grimly hang on, often living under virtual house
arrest, or move farther from the ghetto, only, in some cases, to have to
move again.

Moreover it's urban whites who often bear the brunt of school
desegregation orders, racial hiring quotas, minority housing plans and
other melioristic social programs that grew out of the civil rights era.
For they often find themselves in the same school systems or competing
for the same jobs and housing as blacks and other minorities.

The whites in Marquette Park are particularly embittered over the
Federal Housing Administration mortgage insurance program which they
claim is causing neighborhood deterioration by subsidizing home
purchases by blacks too poor to maintain them. Long conservatively run
and an engine of the post-World War II suburban housing boom, the FHA
program was liberalized shortly after the 1968 urban riots to encourage
lower-income black home ownership ("if they own it they won't burn it"
was the maxim of the time). Downpayment requirements for FHA mortgages
were all but eliminated and lending standards were relaxed.

A Complicated Situation

Many observers are quick to dismiss Marquette Park's whites as bigots
and therefore unworthy of concern. In truth, racism runs deeply in the
community. Last summer a mob of jeering, rock throwing whites injured
several dozen blacks and policemen during a civil rights march in the
neighborhood. Black families living in the area periodically have had
the windows of their homes shattered. Several black homes have been

But the situation is more complicated than that. For every
generalization there is a host of exceptions. It's a drama largely
without heroes or villains--just people, white and black- urban
dynamics. Here are some stories and impressions gleaned from a number of
interviews with Marquette Park's residents.

Joann Hanahan says that she was on edge from the moment a year ago that
blacks began moving on her block in the eastern section of Marquette
Park. "Like a lot of people around there, my husband and I had seen the
neighborhood we grew up in wrecked after blacks moved in, so naturally
we were worried," recalls the 40 year-old warehouse worker's wife. At
first there were no problems, according to Mrs. Hanahan. "Most of the
blacks who moved in were nice people like the cement finisher who bought
the house directly across the street from us. They were running from the
ghetto too," she says.

But things changed last summer. In June, a black youth robbed an
acquaintance of Mrs. Hanahan of $100 while she was on her way to the
beauty parlor.

A daughter of one of Mrs. Hanahan's neighbors was jostled and robbed of
her school lunch money a few weeks later by a gang of black girls.
Finally in August, Mrs Hanahan's 13-year-old daughter and a friend had
their bicycles stolen by two black teenagers who knocked one of the
girls off her bike in the process. The Hanahans put their house on the
market three days later.

The sale proved traumatic. A black family bought the home for $14,000,
which was about the price the Hanahans had paid for the six-room frame
house 11 years before. "We were sick about the price because we'd spent
a lot of money siding the garage, panelling bedrooms and putting on a
new back porch. Now we have to live in an apartment because we didnthe
Hanahans had paid for the six-room frame house 11 years before. "We were
sick about the price

As often as not, whites living in the transition area of Marquette Park
can cite few personal difficulties with blacks. But racial change breeds
hysteria. Stories of racial incidents become vastly overblown. In such
an atmosphere, often all it takes is some trivial incident to trlgger a
decision to move. This was the case with Pat Salmon, an officer of a
neighborhood savings and loan who moved his family to a white area of
Marquette Park several months ago. He says he decided to move one day
last fall after noticing that the name of a black youth gang had been
spray-painted on the stadium wall of the local Catholic high school.

Says Mr. Salmon: "I know that it is really a small thing but the
Graffiti really burned me up. I mean the white people who have lived in
the neighborhood for years have more respect for property. I was
suddenly struck with the hopelessness of the whole situation and the
fact that my wife and I had been talking about nothing else but the
blacks for the last six months. Mentally, I just couldn't handle it any

The black families moving into Marquette Park also are beset by various
fears. Tommie Johnson, an unemployed mechanic in his late 30s, tells of
white neighbors kicking several of his family's wardrobe boxes and
muttering about "the niggers moving in" when they moved into their
apartment three months ago. Since then, garbage has been dumped in their
backyard several times. Says Alfred Williams, a muscular black
25-year-old body and fender repairman, "I really hope that the white
families will stay on the block because if it goes all black the
neighborhood will go bad. In black areas, there are just too many kids
hanging around breaking in houses and messing things up." Mr. Williams
purchased a home in the area last November for no money down under a
government mortgage program.

It's difficult to determine whether the influx of blacks into the
eastern fringe of Marquette Park has resulted in a rise in crime there,
as many white residents claim. A watch commander at the local district
police station says that comparative crime statistics aren't collected
on a block-by-block basis so that he doesn't know. However, a white
police sergeant later tells a visitor privately that beat car coverage
in the mixed area has been increased because of a rise in the number of
calls. "It's mostly small stuff--car thefts, broken windows and other
petty vandalism. But if the area follows the pattern of many of the
all-black neighborhoods nearby, major index crime will start to rise

A focus of racial tension in Marquette Park has been Gage Park High
School, one of two public high schools serving the neighborhood. Rioting
there first erupted four years ago when blacks moving into the area
bordering Marquette Park began enrolling in the school in large numbers.
Before it was over, hundreds of policemen had to be called in to quell
the violence and the school closed for several days.

Cultural Life Imperiled

Many of the white residents of Marquette Park fear racial change because
they feel that it imperils their community and cultural life. A case in
point is the neighborhood's 15,000 residents of Lithuanian descent.

At present, the area boasts its own Lithuanian ballet and opera
companies, folk dancing troupes and even a cultural museum. In the
summer, Lithuanian soccer leagues abound in the park just like in the
old country. And perhaps most impressive in an area where the median
family income is less than $13,000 a year, the Lithuanian community has
managed to build a major hospital complex and several schools. A large
Lithuanian cathedral where masses are still offered in Lithuanian,
presides over all.

"Of course we'll lose most of this if the blacks take over because the
Lithuanians will scatter to the suburbs and other neighborhoods and lose
interest in the community." Dr. Juozas Meskauskas, a 70-year old
physician who lives and works in Marquette Park, observes sadly. Many of
us who lived through the Russian and Nazi invasions of Lithuania feel we
are being invaded again."

To Marquette Park's whites, government is frequently an alien force with
its array of social legislation favoring minorities, racial quotas and
antidiscrimination policies. The principal target of their ire, the FHA
mortgage insurance program, permits persons unable to qualify for
conventional financing to purchase homes through mortgages provided by
private lenders but insured against default by the federal government.

"All you need to qualify for an FHA mortgage on most of our homes is a
down payment of $200 to $300 and marginal income," says James Capraro,
executive director of the Greater Southwest Development Corp., a company
formed by a group of Marquette Park financial institutions to
rehabilitate buildings there. Consequently FHA ends up pumping a lot of
blacks into the neighborhood who can't afford to maintain their homes
and frequently have to abandon them. It's like somebody owning a used
car he doesn't have much money invested in. If something serious happens
like a major repair, a job layoff, or a divorce, people are inclined to
just walk away from their homes."

And, indeed, there are signs of decay in the racially-changing section
of Marquette Park, where more than 80% of the sales in the past year
have been financed through government insured mortgages. On almost every
block at least one home sits vacant and boarded-up, the telltale sign of
an FHA foreclosure. Many of the vacant homes have been vandalized. A
heavy blanket of snow only partly hides the litter in the streets of the
once carefully-maintained neighborhood.

What does the future hold for Marquette Park? "We hope that the area can
survive as a pleasant, middle class community for whites and black
alike, but only time will tell," ventures Mr. Capraro. "After all,
neighborhoods should be more than disposable products."

Mr. Laing is a member of the Journal's Chicago bureau.

[Because of its antiquity, the article above is not available on Dow
Jones News retrieval and has been reproduced in its entirety for your


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