Racialization and the State: The Housing Act of 1934 and the Creation of the Federal Housing Administration

Abstract

Research examining the impact of corporate interests, state structures, and class contradictions on the state policy formation process has been dominated by three major theoretical perspectives: business dominance theory, state-centered theory, and Marxian structuralism. I argue that these existing perspectives pay insufficient attention to race and racial discrimination as a central component in the formulation and implementation of state policy. This article uses the concept of racialization to reframe existing theories of the state to explain the origin of the Federal Housing Administration (FHA) through the Housing Act of 1934. As an integral component of New Deal legislation, the FHA was created for the purpose of salvaging the home building and finance industries that had collapsed during the Great Depression. I draw on government housing reports and analyses, real estate industry documents, and congressional testimony to examine the racial dynamic of the FHA's housing policies and subsidies. The analysis demonstrates the value of employing a racialization framework to account for the racial motivations surrounding the origin of state policies, the racial basis of corporate interests, and the impact of race and racial discrimination on the creation and development of state structures.