The Value of Exclusion: Chasing Scarcity through Social Exclusion in Early Twentieth Century Atlanta

Abstract

In recent decades, a powerful narrative has taken shape which explores the impact of federal housing policies in shaping the highly racialized geography of poverty and privilege which forms the landscape of today's American city. Called the “New Suburban History,” it documents the racial discrimination written into the subsidized home loan policies of the federal government after WWII, based upon the assumption that property values depended upon the maintenance of neighborhood homogeneity on the basis of race and class. The discussion launched by the New Suburban History has focused almost exclusively on the effects of such policies: by lavishing neighborhoods comprised exclusively of white homeowners with federal subsidies, while targeting the neighborhoods of non-whites and renters for red-lining, these programs, it is argued, became self-fulfilling prophecies of neighborhood growth and decline. Neglected in this discussion, however, is a rigorous examination of the roots of the assumption that the value of the single-family residential home depended upon practices of social exclusion designed to “protect” it from physical proximity to non-whites and renters. The guiding assumption, occasionally made explicit, is that racism precluded a more rational approach to the assessment of property values. This paper argues that there was nothing irrational about the regulations developed to protect urban property values in the first decades of the twentieth century. These regulations explicitly sought to boost and maintain real estate values by means of artificial limitations placed on the supply of urban land, an approach which ensured that segments of the population would benefit from the scarcity-induced rise in prices, while others faced exclusion in the process of effecting it. The development of these regulations, and the crisis narratives employed to justify them, is traced here from the municipal zoning framework developed at the National Conference on City Planning to its implementation in New York City in 1916 and Atlanta in 1922. The paper concludes with an analysis of the 1938 Home Owners Loan Corporation (HOLC) “residential security map” of Atlanta, which assigned grades to the city's neighborhoods on the basis of their place in the 1922 zoning scheme, which essentially knew two categories, “exclusive” and “excluded.” Against the standard narrative, which holds that racism distorted conceptions of property values in the twentieth century American city, what is argued here is that the institution of value, and the social categories of privilege and exclusion which it requires, has fundamentally shaped our categories of race.