I much prefer being in more diverse areas, but I don't think where I grew up was somehow bad or wrong. It is a very middle class place, so it's not like the minorities were being pushed out, there just weren't many non-white people that wanted/want to live there! ...but to be fair, a lot of white people don't want to live there either, it's quite boring.
Further, if housing discrimination was still going on in the 90's and 00's, I have no idea where these people were being "pushed out" to. The closest towns/cities with significant racial minority populations were at least 250 miles away...the city I grew up outside of was 90% white (currently 82% white) and there were/are plenty of undesirable locations there. It's middle America, there are just a ton of white people (sorry?).
Sure, in some parts of the country, it is. But in other parts of the country, it isn't.
It's part of the DNA basically if you only look at big cities on the coasts.
Also, Palo Alto is a big city on the coast.