White-flight, single-tenure housing, and many of the other urban planning policies that dominated post-war. During the 40s, huge numbers of African-Americans migrated from the rural South into industrial cities all over the country, from Seattle to Detroit to LA to Boston. For the previous 50 years, politicians and planners were looking for ways to get people out of the city centers, which were seen as unhealthy both physically and morally. With cars being widely available to the average white middle class family, and gobs of space outside of cities, development took place in suburbs, allowing newly well-off white families to move out of the city and into suburbs. This left the inner-cities as the domain of poorer minorities, which started the cycle of degeneration in services. Even today, the poorest counties in many states are either in the largest city or very rural. (http://money.msn.com/family-money/the-poorest-county-in-each-state-mainstreet)

The predominately white political system continued to focus on growth in the suburbs, further alienating the inner cities. When social and affordable housing was built, it was built all together, not mixed in with market-rate housing, thus creating ghettos. Ironically, shops serving singularly poor areas tend to be more expensive than ones serving mixed income or affluent areas, thus continuing the cycle.

Edit: Because people have asked, a word on food deserts and the problem of getting food in low income areas. Larger chains stores generally move to affluent areas because they can better maximize their profits, as the demand for high price-to-shelf space food items doesn't exist in poor neighborhoods. Thus, they all go into richer neighborhoods where, despite competition driving the price down, they still make more money than they would have in the poor neighborhood.

Seeing as the Detroit race riots were going on while this rapport was commissioned, I'll use Detroit as an example as to how ghettos were created.

Back in the pre-war days, Detroit used to be a majority white city. It grew to be one of America's most important industrial cities, home of the car industry. During WWII, it became a central pillar to the Arsenal of Democracy. Looking to escape discrimination and hoping to find work in the booming industrial cities, many African-Americans moved from the South to the West and the North of America between 1941 and the 1970s during the Second Great Migration.

Already economically disadvantaged, once these African-Americans arrived in cities like Detroit, they found it difficult to find decent and affordable housing. Detroit at this point had a population of between 1.5 and 1.8 million, sky-rocketing house prices. The African-American newcomers usually ended up in the older and more run-down parts of town, already experiencing a form of ghettoisation. Even if they weren't forced into these neighbourhoods thanks to economic forces, white neighbourhoods often were forbidden from renting houses to African-Americans. So where economic pressure failed, racism picked up the slack. If a black family did manage to move into a white neighbourhood, they were often subjected to heavy harassment and vandalism, even death threats and violence.

After the war, the city started several large scale urban renewal projects and of course aimed these at the disproportionally African-American older neighbourhoods. This pushed the black communities of Detroit into the now fewer affordable neighbourhoods, concentrating them once more.

At this point, you can easily call the areas where the black population was concentrated ghettos, but it gets worse. Facing rampant discrimination not only by landlords, but also in policing, employment, education and so on and so on, the African-American community grew increasingly disgruntled, boiling over into the 1967 riots. Even before the riots, many of the white factory workers had reached a level of prosperity where they could afford a move to the suburbs - fuelled in part by racism, they started leaving the city. After the riots and after Milliken v. Bradley which allowed inexplicit segregation, however, this became a landslide - known as white flight. Between 1950 and 1970, the white population of Detroit dropped from 1.5m to 800k. I mention this because it marks the beginning of the shift from ghetto neighbourhoods in American cities to entire cities essentially becoming one big ghetto.

The same reasons as before prevented African-Americans from joining their white compatriots in the suburbs - the suburbs were expensive, many didn't allow selling/renting houses to African-Americans and even if that did work out, the white population usually drove the African-Americans out. While white flight did open up more space for African-Americans in the city itself, it also had catastrophic repercussions which would eventually lead to the situation of the city today. To put things bluntly, when the white population of Detroit moved to the suburbs, they took with them a very large part of the former tax base of the city. As you can imagine, this - along with a plethora of other things - had a very negative impact on the city, setting in its decline. Less tax income means less money could be spent on the city, on services, on maintenance and so on. This sets in a rot in the city, which leads to many of the problems of the modern day ghetto. This, along with the subsequent economic problems of the city and the world as a whole, pretty much prevented any turn-around for the city and its ghettos.

That's just a summary of a decent answer, I guess, but even that can be summed up as: 'Ghettos were created by economic pressures and systemic/outright racism.'

e: I probably shouldn't start writing posts, go do something else, then return and finish it - because at that point, someone else will have answered the question without rambling on.

Here's but a TINY piece of the puzzle that I hope someone else with more expertise and knowledge will elaborate on further: the National Housing Act of 1934. This act began the practice of "redlining," a type of mortgage discrimination. The Federal Housing Administration (FHA) allowed the Home Owners' Loan Corporation to create maps of the risks associated with borrowers who lived in certain urban neighborhoods. They placed homeowners into different categories. The first category belonged to those who lived in areas that were the most stable, in demand, and "homogenous;" the second category to those that were slightly less in demand but still stable and homogenous. Both of these categories consisted largely of white middle-class families from the suburbs or other non-urban areas. Following those two categories was a third and fourth, which is where discriminatory practices began. These categories (consisting mostly of urban, African-American individuals) were defined as residents of those areas that were very cheap to live in and/or near African-American residences, thus "attracting an undesirable element." Through this policy, an overwhelming majority of mortgage loans went towards white middle-class individuals, which allowed them to seek out more expensive homes in the suburbs. Since so few loans went to African-Americans, they were disproportionately forced to live in the cheaper housing of urban centers.

And when I say "so few" loans went to African-Americans, I really mean "so few." Indeed, from "1930 and 1950, three out of five homes purchased in the United States were financed by FHA, yet less than two percent of the FHA loans were made to non-white home buyers." (Source: The Perpetuation of Residential Racial Segregation in America: Historical Discrimination, Modern Forms of Exclusion, and Inclusionary Remedies)

edit for clarity

Here are some things that whites did to create or maintain ghettos:

• Terrorism. The KKK didn't get famous for helping little old black ladies across the street, you know! If a black family moved into the "nice" neighborhood, bad things happened to them. The Tulsa race riots, where blacks made a nice neighborhood and whites from surrounding areas came and burned down everything, is an extreme case only in scale.

• Sundown laws. Most suburbs in America put sundown laws in place, which made it illegal for people of color to be within city limits after dark. It's hard to live in town if you can't be there at night. James Loewen's Sundown Towns: A Hidden Dimension of American Racism explores the subject pretty thoroughly. In my area, the only place within thirty road miles that DIDN'T have a sundown law is the tiny town of Gorst... which was then bulldozed out of existence by an expansion of Highway 3.

• Covenants. In cities that did not have sundown laws, housing developers frequently attached covenants to the deeds on the houses they sold, prohibiting reselling the houses to non-whites. Some of these covenants are still on the books, although they're not enforceable anymore.

So, you've got structures in place to force blacks to live only in very particular areas-- ghettos, in a word. To make it impossible for them to turn those areas into better places, we have

• Redlining, the practice of refusing to provide loans on houses in a particular area. When the FHA was created as part of the New Deal, it had a set of "residential security" maps created, showing areas that were "too unsafe" to lend in. Why, yes, that would be the black part of town. Other mortgage lenders followed the practice. Since working-class people can't usually build up enough savings to buy a house with cash, this forced all blacks in the area to rent from whoever had owned the buildings before-- and since the owners knew that their tenants were stuck in place, they could jack up rents while failing to provide maintenance. Ta-Nehisi Coates did a pretty good series on his blog at the Atlantic last year; here's the reading list he used.

Another factor: it was common for house deeds to come with what were called "restrictive covenants," basically riders on the contract that said "if you buy this home, you cannot then sell it to a nonwhite person when you move on." They were particularly prevalent in the 20s, 30s, and 40s until 1948's Shelley v. Kraemer found them unconstitutional.

Reading this has got me wondering, was this only the case for African-Americans or were other races/ethnicities/nationalities/minorities/etc subjugated to this?

For example many Irish immigrants faced racism and discrimination, as well as Chinese immigrants, Jewish immigrants and so on.