As she has watched white leftists engage in street battles with white nationalists on Portland’s waterfront, Debi Smith has been struck with a sense of gratitude for those willing to fight, in a sense, for her.

But for the life-long Pacific Northwest resident, who is African-American, her thankfulness comes with a caveat grounded in personal experience and history.

After all, Ms. Smith has also watched black people, by both choice and force of circumstances, leaving the City of Roses, their numbers declining since 2010. Progressive to its core, Portland is also America’s whitest big city – in part the troubling legacy of Oregon’s founding goal in the 19th century of creating a white utopia through exclusionary laws.

Here in a city of hops and hipsters, where Republicans have been all but banished, Ms. Smith’s properties have been vandalized with racist graffiti – a particularly sore point since they are one of the only black families left in what was once the core of black Portland, around the corner from where Duke Ellington used to hang out.

“Portland is, in fact, a white utopia, so, for black people, that means race is always there,” says Smith, a Human Resources manager for Multnomah County, where the percentage of registered Republicans dropped from 24 percent in 2001 to 14 percent in 2014. “Trump unleashed a lot of racial hatred, but there are a lot of old-school folks even here in Portland who are still very uncomfortable with black people.”

The growing tensions nationally are punctuating a complicated truth in Portland and other so-called liberal “whitopias” – that structural racism may be harder to see, but can be just as insidious as the “blood and soil” chants heard in Charlottesville, Va., last weekend.

From Minneapolis to Portland, the moral equivocation of President Trump on the deadly violence in Charlottesville is, thus, highlighting “the hypocrisy of white people around our activism,” says Jessie Daniels, author of “White Lies” and a sociologist at the City University of New York.

Indeed, she says, cities where every coffee shop is plastered with “All Are Welcome” posters tend to be the very ones where many white residents display “a kind of ignorance, an inability to see and understand the world that we have created. It is where we get this shock, this amazement, at overt white supremacy.”

‘A major, unique thing going on here’

In that way, as Portland focuses new economic development efforts on the black community and rethinks its housing policy, the city offers a glimpse of a work in progress – a journey to not just absolve past racial sins, but to stop committing them.

“You recognize that there is a major, unique thing going on here,” says Ellis “Ray” Leary, a black Portland resident. “What bubbles up is this thing with a progressive veneer that covers a sinister underbelly. The question now is: How does that translate into a positive regard for black people going forward, and what is the impact of that on … [liberal white] cities in America?”

In recent days, clashes over Confederate monuments and free speech rights for hard-right rallies are spilling into American streets and dominating the news. Portlanders have clashed over similar issues, repeatedly since last fall, with fists, sticks, and silly string.

Three people were killed during last weekend's clashes in Charlottesville, including a female counter-protester who was run over by a Nazi sympathizer in an act being investigated as domestic terrorism.

So far, city officials have pointed to outside agitators as the culprits. But in Charlottesville, the organizer of the “Unite the Right” rally is a local. And Richard Spencer, a self-described alt-right white nationalist who greeted Trump’s inauguration with a “Hail Trump!” salute, attended the University of Virginia.

“Signs declaring allegiance to the principles of diversity and inclusion dot the landscape here ... performative progressivism,” writes University of Virginia Prof. Nicole Hemmer in Vox. “But Charlottesville is not as comprehensively liberal as the visuals suggest.”

Going beyond the surface

Indeed, in Portland and elsewhere, simply confronting phalanxes of white nationalists on the streets may fail to address the hypocrisy Ms. Daniels refers to and, she adds, “betrays only a surface understanding of white supremacy.”

Earlier this year, a black farmer in Charlottesville, Chris Newman, noted on Facebook, “It isn't Richard Spencer calling the cops on me for farming while Black. It’s nervous White women in yoga pants with ‘I'm with Her’ and ‘Coexist’ stickers on their German SUVs.”

“When we think about the history of race and racism, we have a kind of collective sensibility that these are things that happened in the South,” says Portland native Neda Maghbouleh, author of “The Limits of Whiteness,” and a sociologist at the University of Toronto. “But there’s a pattern of really big immigration cases that started in Portland, one which centers on a naturalization examiner in the 1920s, who would habitually reject applications of naturalization from the Middle East, claiming that they don’t meet the requirements as free white people. Understanding that was a full-circle moment for me – a smoking gun.”

Greg Wahl-Stephens/AP/File Barack Obama speaks to supporters at a presidential campaign rally in Portland, Ore., on May 18, 2008. Some Portland natives say the photo, showing a sea of largely white faces, reveals the city's flawed track record on racial inclusion.

Similar to other progressive West Coast enclaves – from Seattle to San Francisco – African-Americans are exiting long-held Portland neighborhoods in droves. Census numbers show 10,000 African-Americans moved from areas near the city’s center to its edge suburbs between 2000 and 2010, and the Manhattan Institute found that trend continuing into this decade, with 11.5 percent of the remaining population leaving between 2010 and 2014. Black Americans make up only 3.1 percent of Oregon’s population; the national average is 13 percent. Blacks seem to be finding more and better opportunities in areas with more diversity: the South, the Midwest and the Northeast, in that order.

Considering choices

Walidah Imarisha, a local poet and author of “Angels with Dirty Faces,” says, “Portlanders still frame this idea of where people live as a choice, and that if black people aren’t there it’s a choice they are making.”

People often relocate for positive as well as negative reasons, of course. But she says that if the changes in Portland were largely positive, black household wealth would be increasing along with that of white households, instead of black neighborhoods being steamrolled by development and gentrification.

The few US counties where black wealth exceeds white wealth are largely in the South and Midwest, around diverse cities such as Chicago and Atlanta. Boston, Minneapolis, and Portland, on the other hand, are failing to generate black wealth. In Minnesota, minority households have median incomes about 50 percent of their white counterparts, down from 74 percent in 1960.

Last year, the Boston Federal Reserve Bank found that for every $1 of white wealth in Massachusetts’ liberal bastion of Boston, African-Americans claim 2 cents. Charlottesville is among the top 3 percent of US cities when it comes to racial wealth inequality.

And as white Portlanders have grown richer, the median black income has fallen – to less than $30,000 per year. The city’s criminal justice system sends black kids to juvenile detention at four to five times the rate of white kids, for the same misdeeds, according to a Portland State University report. Oregon and Portland have “been slow to dismantle overtly racist policies,” with the effect of “limiting the ways our community has been able to advance and thrive,” the report concludes.

Settled largely by New Englanders, Oregon enshrined white supremacy in its original Constitution, punishing blacks with six lashes for overstaying a two-year welcome. Exclusionary policies didn’t end until the 1990s, when redlining – an illegal process of keeping black homeowners out of certain neighborhoods – ended.

In its wake, the hipster haven of “Portlandia” emerged. Many of that popular comedy show’s skits have been filmed in the city’s former black neighborhoods – with nary a black person in sight.

Mr. Leary, the Portland resident, calls the plight of black Americans in Portland “a great social crime” perpetrated not by overt white supremacists, but well-meaning liberal whites.

‘People care about each other’

To be sure, for many white residents, like Brian Drew, the pushback by Portlanders against white nationalists suggests a different story. Portland just hired its first female African-American police chief, Danielle Outlaw, and has a long history of promoting black candidates to positions of power. The city has some 5,000 black-owned businesses and a robust population of black professionals, many of whom work in progressive headquarters of Nike, Intel, and Adidas. The Portland Housing Authority says by 2020 it will have created 2,200 new homes for low-income Portlanders in the downtown area.

On a sunny Portland afternoon, Mr. Drew, a software engineer, is watching a fundraising basketball tournament in a town that clearly relishes black culture. Blues and jazz abound, and basketball is the city’s unofficial sport. “Portland is the best of all worlds, rolled into one,” he says. “People care about each other. It’s a collective.”

But according to Ms. Maghbouleh, a 2008 Associated Press photograph of candidate Barack Obama visiting the city sums up the paradox. In the stunning picture, President Obama gazes out – on a sea of white faces.

“Portland is a utopian city – if you are white and wealthy,” adds Ms. Imarisha, the poet, adding that it was designed that way.

Now that legacy is proving stubborn to dislodge, in sometimes tragic ways.

Police say that in late May, Jeremy Christian, a one-time Bernie Sanders supporter who had marched at a white nationalist rally, began harassing two minority women on the city’s light rail MAX line. Three men tried to intercede when Mr. Christian, according to police, produced a knife and stabbed two of them to death.

The deaths fueled more violent clashes by political extremists and have left the city raw.

But it also broke open the “bubble” of Portland’s white history, says Portland State University sociologist Randy Blazak.

“Portland is libertine and a little bit libertarian,” he says. “We are free from the traditional halls of power because we are way out here in the corner of the country. But it creates this strange mix of perception of being very progressive … within this privileged position of racial history in Portland, which is removed from reality. That’s why the MAX murders were shocking to so many white people, but not shocking to so many people of color.”

Randy Smith, a black jazz musician, leans back against his Rolls Royce, which he keeps unlocked in his driveway. He acknowledges that, at its worst, the black neighborhood in the Lower Albina neighborhood was rife with vice. Now, thanks to his mom, Betty Smith, the family has grown wealthy as she bought up 11 properties, in a neighborhood where the average home price has skyrocketed past $400,000 as black residents left, unable to afford to buy or rent.

Despite his family’s prosperity, Mr. Smith mourns the lack of “a sense of togetherness" for the black community.

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Leary, for his part, sees a growing recognition that Portland has become “too white.” He says the city’s leaders are realizing there are economic implications to the failure of the city to address its legacy of forced segregation and exclusion of minorities.

“The fact is, black culture brought creativity, the work force, the flavor to this city,” he says. “Now there is an all-hands-on-deck effort to recapture a catalytic sense of place for us. But I don’t know if it can be recaptured.”