(Originally published on Bloomberg Businessweek; written by Peter Coy)

Early this year, before the summer weather in Ferguson, Mo., turned to a fog of tear gas and a hail of rubber bullets, before the downscale suburb began to share national airtime with Sierra Leone and Iraq, a legal aid firm called ArchCity Defenders prepared a white paper that accused several municipalities in St. Louis County of stopping black drivers disproportionately for traffic violations, fining them in court sessions that were closed to the public, and jailing them when they were unable to pay. Singled out as “chronic offenders” were three neighboring towns in the northern part of the county: Florissant, Bel-Ridge, and Ferguson.

The untitled paper was still sitting in Executive Director Thomas Harvey’s computer on Aug. 9, awaiting finishing touches, when Michael Brown, an unarmed black 18-year-old, was shot dead by Darren Wilson, a white Ferguson police officer.

Who’s to blame in the confrontation that led to Brown’s death has yet to be sorted out. But the ArchCity Defenders report is the clearest evidence to date that Ferguson’s justice system was discriminatory in practice, if not intent, long before the police force’s heavy-handed response to the riots that followed the fatal shooting. Harvey and his co-authors found that middle-class drivers stopped by police routinely hire lawyers who knock speeding tickets down to non-moving violations; poorer drivers, mostly black, who can’t afford lawyers, often find themselves caught in a downward spiral. They get points on their licenses, they can’t afford their fines, they’re jailed, they lose their jobs, they drive with suspended licenses and get into deeper trouble.

One can question ArchCity Defenders’ blunt claim that “defendants are incarcerated for their poverty.” It’s harder to dispute the defense attorneys’ warning that Ferguson’s practices “destroy the public’s confidence in the justice system and its component parts.”

The rioting and looting in Ferguson are plainly wrong in every respect, but they’re taking place in a society that plainly isn’t working. “This has to be recognized as a symptom of a larger problem,” says Vernellia Randall, a retired University of Dayton law professor. “Every time we see a racial disparity somewhere, we think that it’s an isolated issue—racial disparity in criminal justice, in health care, in loans for cars. This will go on as long as we refuse to recognize that there’s a system and [don’t] work on getting rid of the system.”

Many Americans, especially whites, comfort themselves that the U.S. has become a post-racial society. Not Ferguson, which is 67.4 percent black, 29.3 percent white, and only 3.3 percent everything else. The variegated national reaction to the events in the St. Louis suburb also gives the lie to the post-racial myth. Eighty percent of blacks surveyed nationwide by the Pew Research Center said the Brown shooting “raises important issues about race that need to be discussed.” Only 44 percent of whites felt that way. Twice as many blacks as whites told Pew the police reaction to the protests “has gone too far.”
 
Ferguson has captured the nation’s attention because people sense that other towns and cities suffer some of the same dysfunction. That said, St. Louis County is not America writ small. A unique history of fragmentation and exclusion exacerbates its racial stress. The map of the county looks like a shattered pot, broken into 90 municipalities, along with clots of population in unincorporated areas. Dating as far back as the 19th century, clusters of people set themselves up as municipalities to improve services, or to capture control of tax revenue generated by local businesses, or to avoid paying taxes to support poorer neighbors, or in some cases to exclude blacks.

The natural result is a county whose towns are highly stratified by both race and income. The wealthier southern part remains largely white. The northern section in the elbow of the Mississippi and Missouri rivers, the home of Lambert-St. Louis International Airport and Ferguson, is increasingly black. Some towns in the north have managed to maintain a stable racial mix. Often, though, as blacks move into a town, whites move out. The tax base shrinks, and blacks feel cheated that the amenities they came for quickly disappear, says Clarence Lang, a University of Kansas historian who has studied St. Louis. Class interacts with race. In Ferguson, investors who bought foreclosed homes are renting them to poorer people than the homeowners—both black and white—whom they’re displacing. That’s one reason Ferguson’s median household income adjusted for inflation fell 25 percent from 2000 to 2012, to less than $36,000 a year.

Michael Brown was educated in the underperforming Normandy School District, which lost accreditation last year and is being operated by the Missouri Department of Education. Neighboring school districts have fought accepting Normandy students as transfers. “It may take a village to raise a child, but many administrators and parents in better-resourced parts of our region had no problem saying quite publicly that Michael Brown and his brothers and sisters did not belong in their village,” the black-owned St. Louis American weekly wrote in an editorial. “There is a real story here about what happens when people feel they’re doing the right thing for their families, and they get stopped or slapped in the face,” says Angela Glover Blackwell, a St. Louis native who is founder and chief executive officer of PolicyLink, a nonprofit in Oakland, Calif.

Fragmentation has another pernicious effect: It pits towns against one another. Businesses choosing where to locate can play the tiny municipalities off one another for tax incentives, prompting a race to the bottom that robs them all of desperately needed revenue. “There’s a tremendous opportunity and incentive to just poach from one municipality to another,” says University of Iowa historian Colin Gordon, author of Mapping Decline: St. Louis and the Fate of the American City.

Once a municipality is formed, however small, it’s exceedingly difficult to merge it away. Ferguson is comparatively large at about 21,000 people. Many St. Louis County municipalities have fewer than 1,000; the town of Champ had a 2010 population of 13, all white.

Ferguson is not a crime-ridden economic disaster area like East St. Louis, Ill., on the other side of the Mississippi; it’s lower-middle-income, with a healthy business district and a range of big, close-by employers, including Emerson Electric (EMR), Express Scripts (ESRX), the University of Missouri at St. Louis, Christian Hospital, and Mallinckrodt (MNK). It also benefits from a reasonably enlightened business community. John Gaskin III, a spokesman for the St. Louis County NAACP, is no pushover. He calls Missouri “the most racist state in the country.” But he praises the leadership of Emerson, Boeing (BA), and others. Patrick Sly, who heads the Emerson Charitable Trust, “is one of the most genuine men that you could meet in this town,” Gaskin says. And Danny Bradley, who runs Boeing’s diversity program for St. Louis, is “a gentleman.”

The problem, rather, is that greater St. Louis is locked into a pattern of inequitable development. Iowa’s Gordon writes that St. Louis is “by any measure, one of the most depopulated, deindustrialized, and deeply segregated examples of American urban decay.” Fragmentation “is not the principal cause, but it certainly fed into what’s happening in Ferguson,” says Robert Cohn, author of The History and Growth of St. Louis County, Missouri.

Because of Missouri’s tax laws and political fragmentation, Gordon says, “there is a huge incentive to build the next great mall in the cornfield, because you all of a sudden capture the tax revenue from it. It’s something that everyone recognizes as an insane beggar-your-neighbor policy.” Employment in white, historically rural St. Charles County, to the northwest, has grown about 600 percent since 1990. 
For greater St. Louis, the original sin was committed in 1876, when the city split itself off from the hinterlands of St. Louis County. It seemed like a good idea at the time, because the city was thriving. But from that point on, the city of St. Louis was hemmed in. It couldn’t expand by annexation to capture people as they fanned out from the central city. People who moved to then-rural St. Louis County formed the patchwork of municipalities that exists to this day. Many of those small communities tried to keep blacks out with restrictive covenants on deeds.

In 1948 the U.S. Supreme Court ruled in a case that originated in St. Louis that such covenants were unenforceable by states. The case, Shelley v. Kraemer, was argued for the black home buyers by Thurgood Marshall, who later became the high court’s first African American justice. In redlining, another technique for keeping blacks out, lenders marked certain neighborhoods as unsuited to black buyers. A “residential security” map created in 1937 by the Home Owners’ Loan Corp., a government-sponsored agency, gave its lowest rating, D, mostly to areas where blacks were a majority. The HOLC said houses in one neighborhood had “little or no value today, having suffered a tremendous decline in values due to the colored element now controlling the district,” according to a 1980 article by Columbia University historian Kenneth Jackson.

Overt financial racism is mostly gone, but the legacy of that time lives on, suffocating present-day residents. “There’s a very real sense in which resources for living a healthy, productive life aren’t evenly distributed throughout the region,” says Jason Purnell, a Washington University in St. Louis professor of public health.
 
Three hundred twenty miles east of Ferguson, 19-year-old Timothy Thomas was shot dead in a dark alley in Cincinnati on April 7, 2001, while fleeing an arrest warrant. That made him the 16th black man killed in a confrontation with Cincinnati police in six years, against zero whites during the same period. Protesters demanded information about the shooting, but police said their investigation was incomplete. Riots broke out on April 9 in the largely black Over-the-Rhine neighborhood and spread to other poor areas. More than 100 businesses suffered damage over four days.

The unrest galvanized Cincinnati to change. Under a court-ordered federal monitor, an independent review board was formed to investigate uses of serious force by police. Officers had to fill out contact cards for vehicle stops that specified the race of the drivers. “They’re clearly a lot better,” the Reverend Damon Lynch III, who led calls for a boycott of downtown Cincinnati, told the Cincinnati Enquirer in 2011. Representatives from Cincinnati have even been invited to advise Ferguson on how to heal. Meanwhile, juice bars and condo developers have flooded into Over-the-Rhine, an architectural treasure chest built by German immigrants in the 19th century. The riot zone has come so far, the biggest concern now is gentrification.

In Ferguson, development would be welcome, but residents say fixing the Ferguson Police Department is their most urgent priority. “All the anger is coming from this initial killing and the officer not being held accountable,” James Long, a 46-year-old from nearby Berkeley who’s self-employed in lawn work, said while walking along West Florissant Avenue behind protesters chanting “Hands up! Don’t shoot!”.

Police made matters worse by going RoboCop on the protesters. Militarization violates the ideals of “policing by consent,” a philosophy that goes back to the first police commissioners of the metropolis of London in 1829. The Londoners asserted that “the power of the police to fulfil their functions and duties is dependent on public approval of their existence.”

Ferguson needs more than three black officers on a force of 53. The ArchCity Defenders study found that 86 percent of vehicle stops involve a black motorist, even though blacks make up only two-thirds of the population. After being stopped, blacks are twice as likely to be searched, even though searches of blacks discover contraband only two-thirds as often as searches of whites, the study found.

Helping white officers and the young black men they confront understand each other seems like a soft solution to a hard problem, but it’s a prerequisite to fundamental change, says Amy Lazarus, executive director of the International Institute for Sustained Dialogue in Washington, who in a previous career trained white police recruits to work in mostly black neighborhoods. “We forget that our neighbors want the same thing we do: a safe place to live and work and play.”

Change needs to come from the top as well. A year ago the economic development arms of St. Louis city and county agreed to stop competing and merge efforts. But ideas to reincorporate the city and county governments have been floated repeatedly over the past century, and all have failed. Whites often oppose consolidation because they fear their tax bills will go up, while blacks who have managed to obtain positions of authority fear that a merger “could easily sweep away those gains,” says Lang, the Kansas historian.

It says something good about the U.S. that the travails of one small suburb have riveted the nation’s attention. But change is hard. Neither shouting for the cameras nor participating in candlelight vigils accomplishes much. Hard choices will have to be made. “Lose the preconceived narrative. Ask questions to understand first,” counsels Dr. Chris Schlanger, an emergency-room physician who teaches at Washington University’s Olin School of Business. “If we want to change, let’s change. Otherwise, save the candles.”