The GI Bill changed everything.
When I was younger, I did not understand how controversial the WWII GI Bill had been in Congress. The Republican Party took on stopping what they called “the dole”—referring to the education benefits.
We went through a lower profile fight over the Gulf War GI Bill, with Republicans throwing up procedural obstacles. The heavy lifting was done by Sen. Jim Webb (D-VA), but when it passed all the opponents were at the signing ceremony throwing elbows to take credit for Webb’s work.
Opposition toned down because speaking ill of the care and feeding of “our troops” is no longer politically correct. In the original GI Bill fight, the win could probably be attributed to the bonus marchers of WWI. While they were cleared out of Washington by force, the attack on the bonus marchers was a sorry history few politicians cared to repeat.
Besides screaming “Socialism!” opponents of the WWII GI Bill pointed out that the cost of the programs to aid returning veterans was 15 percent of the entire federal budget in 1948. The idea that a prosperous middle class would make the country prosperous was a hard sell at the time, but it proved to be correct.
The two GI benefits most commonly accessed were education and home loans, and the cost was so high because there were so many ex-GIs. Just about every able-bodied white male (and some not so able-bodied) was in uniform and after the U.S. swore in Hispanic-Americans, African Americans, American Indians and Alaskan and Hawaiian Natives, it also put women in uniform for the first time in great numbers: WACs, WAVEs, WASPs, and SPARs.
It’s worth noting briefly that the most decorated unit in the European theater of WWII is also the most decorated unit of its size in U.S. military history. That would be the 442nd Infantry Regiment, composed only of Nisei serving under white officers, Japanese Americans with birthright citizenship, many of whom served while their parents were locked up in the concentration camps President Trump cited as legal precedent for rounding up American Muslims.
Before the GI Bill, higher education was class-based. You had to be born to it or your chances of a college education were, in statistical terms, nil. It was like legacy admissions writ large. (It’s interesting that even today the best schools don’t deny practicing legacy admissions, a practice that seems on its face a bit less than egalitarian.)
The NAACP had called a truce in the struggle for equal rights. If Hitler did not get beaten, the thinking went, the problem for non-whites would not be equal rights. It would be physical survival.
Black ex-GIs quickly occupied all the seats in historically black colleges, and those caught standing when the music stopped became plaintiffs in a series of cases that would force integration of graduate and professional schools, colleges and universities, and finally culminate in Brown v. Board of Education.
Racism in education did not go away and the promise of Brown in K-12 was never realized. Most students still attend de facto segregated K-12 schools when de jure segregation is long gone.
Still, the GI Bill had the intended effect in higher education. By sheer numbers, it was the invasion of the white working class that changed campus culture, but ex-GIs of all colors could access education benefits by simply showing up on campus.
The other major GI Bill benefit—a home mortgage guarantee—was a bit more problematic for black and Indian ex-GIs. Indians had the problem that trust land could not be mortgaged. Blacks had the problem that, because Republicans were opposed, the votes of the Dixiecrats were necessary to pass the GI Bill.
In return for their votes, the Dixiecrats extorted measures to keep black ex-GIs from home ownership. The primary method was to extend “redlining,” a practice required by law to purchase Dixiecrat votes for the Federal Housing Administration (FHA) in 1934. Within the red lines on a map, banks would not underwrite home loans and insurance companies would not write affordable homeowner policies.
The housing benefits, moreover, were much easier than the education benefits to close off at choke points where blacks were not allowed to pass, something Congress encouraged by leaving administration to the states. Additionally, homes not within the red lines were often burdened by racially restrictive covenants in their deeds directed at non-whites generally.
As the FHA and VA programs of the New Deal moved Americans from renters to homeowners, the demand for housing expanded faster than the supply. To meet that demand, a company called Levitt & Sons invented the tract houses ubiquitous in the U.S. to this day. Levitt built 17,447 houses in the next four years and other builders took up the model.
To buy into a “Levittown,” you had to be an ex-GI, which meant that Levittown loans were all government guaranteed. You also had to be white. Before the FHA/VA loan guarantees, down payments were commonly half the purchase price and mortgages ranged between six and 11 years. This is why the United States had been a nation of renters.
By the mid-1970s, the federally guaranteed loans had made homeowners of 11 million Americans. Less than two percent were black. There were probably not enough Indians to be worth counting. The post-war period was the rise of the great American middle class and the age of government sponsored affirmative action for white people.
By the time the first GI loans reached maturity, the homes they purchased had appreciated greatly in value. Most homes doubled in value in the first 20 years. Even today, home equity makes up about 60 percent of a typical family’s net worth. Most families have far more wealth in home equity than they have in stocks.
Ira Katznelson’s book, When Affirmative Action Was White, described the result of the GI Bill’s tilt towards white veterans:
The consequences proved profound. By 1984, when G.I. Bill mortgages had mainly matured, the median white household had a net worth of $39,135; the comparable figure for black households was only $3,397, or just 9 percent of white holdings. Most of this difference was accounted for by the absence of homeownership.
This disparity continues to play out in intergenerational wealth transfer, with white families better able to get their kids started with college tuition or a down payment for a house by tapping the home equity. When mom and dad walk on, black baby boomers can expect to inherit 13 cents for every dollar white boomers inherit.
The U.S. Supreme Court declared racially restrictive covenants in property deeds to be unenforceable in 1948, but the decision had little impact. The covenants were still there, still showed up in a title search, and title insurance companies were reluctant to ignore them. They also guided real estate agents and intimidated potential buyers who lacked both lawyers and white skin.
It was not until the Fair Housing Act of 1968 that racially restrictive covenants and redlining were outlawed nationwide and the era of affirmative action for white people was over.
The GI Bill changed everything. A college education was no longer a class privilege. A nation of renters had become a nation of homeowners. And white families came out of the post-war boom times with net worths so much greater than non-white families that they became convinced their wealth meant they were smarter and harder working than people of color.
When affirmative action came along after the Civil Rights Movement as a method for helping non-whites recover from legal disadvantages begun with the FHA in 1934 and not ended until 1968, white people understandably felt shunted aside in favor of the lazy and the stupid.
I am not being sarcastic when I say the GI Bill changed everything. Failure to break race barriers at the same time as class barriers does not make breaking class barriers a bad thing. I personally benefitted from a GI Bill education and a VA guaranteed home loan. The GI Bill changed my life for the better and it changed the country for the better.
I’m just suggesting that inner city blacks and reservation Indians did not vault into the middle class in the post-war boom for reasons other than being either lazy or stupid. Starting with the Reagan Revolution and going on steroids with the election of Donald Trump, the policies that built the American middle class are being shredded. It would be good if the fight to rebuild the middle class—unlike the laws that built it in the first place—includes non-whites.
Steve Russell, Cherokee Nation of Oklahoma, is a retired Texas trial court judge and associate professor emeritus of criminal justice at Indiana University-Bloomington. He lives in Georgetown, Texas.