People are living in rundown chicken coops converted into slum housing. Their furniture is stained by the water that rises through the warped floorboards and floods the rooms when it rains.

A visitor to Goldie Mae Jackson's home must stoop to climb through a hole in the broken screen door to join a swarm of flies inside.

In the segregated 2nd Ward of Cambridge -- home for more than 4,300 blacks -- life has not changed much in the 15 years since Cambridge became a national symbol of racial repression.

The National Guard staged its longest occupation in the country here -- five days short of a year -- after civil rights demonstrations led to violence in 1963 and 1964. H. Rap Brown led protests that erupted into violence and flames and led to his indictment for arson in 1967.

But today, in this tradition-bound port city on Maryland's Eastern Shore, the system continues to frustrate the aspirations of black residents who make up 38 percent of the population.

Among the 30 or so lawyers who practice in this county seat, there are no blacks. There are no blacks in the county's 14 volunteer fire companies or among the 15 sheriff's deputies. And black unemployment is 19 percent-three times higher than the jobless rate for whites.

"It's a southern town with a lot of old ideas and a lot of older people who want to perpetuate the old ideas," said Edward Watkins, the only black on the five-member city commission.

In her 2nd Ward shack, Goldie Mae Jackson, 74, and her next-door neighbor watch the fantasy world of TV game shows on an old black-and white set. The fading paper on the wall records the marriage in 1925 of "Sister Hughes, 20, colored"to the now deceased John Jackson, "25, colored." The $80-a-month unit has a wood stove for winter warmth, a refrigerator that sometimes works and the almost overpowering stench of neglect.

"You got nowhere else to go," shrugs her neighbor.

So they live as best they can on narrow streets without sidewalks or gutters.

Across town, on a wide street with sidewalks and gutters a block from the Choptank River, lives Mrs. Jackson's landlord.

E. Hallie Creighton, a distinguished-looking white man with silver hair, and his family own more than 100 pieces of property in the 2nd Ward.

"I can't afford to say anything," he said. "I have no comment."

"The slum landlords run this city," said a prominent white businessman who asked not to be named because "I'd lose four of my best customers. They're not bad people. They say, 'I know it's not right, but it's the system.'"

The legal barriers are gone.

The schools, the restaurants, the pool have been desegregated by law for years.

But the town's sole black physician is one of only two members of his race who belong to the 155-member Chamber of Commerce. The United Fund has one black board member out of 18. There are separate American Legion posts. There are five blacks on the 36-member police force, a ratio unchanged in more than a decade.

Although Dorchester County surrounding Cambridge is one-third black, there has never been a black county commissioner.

Fewer than 15 percent of blacks over 25 years old have finished high school, barely half the county-wide rate.

"Most everybody around here dropouts," said Tina Pinkett, 16, who was unable to explain further, why she quit school in the eighth grade.

To Cambridge blacks, the old ideas were embodied in the Veterans of Foreign Wars and all-white service groups like the Jaycees who use the VFW building. Several blacks said they were not welcome at the VFW building even as guests. There was nothing in writing; it was just understood, they said, and occasionally made verbally explicit.

A black Cambridge native you have moved to Baltimore and become active in a Jaycee chapter near there caused a stir recently by announcing his intention to break the alleged color bar in his hometown. News of Tyrone Seymore's visit preceded him to the VFW, where he was addressed as "Mr Seymore" and assured by leaders of both the VFW and the Jaycees that their groups did not discriminate.

Seymore left with a handful of applications to both groups. "All I want them to do is open the doors to black people," he said.

Many of Cambridge's best and brightest of both races are finding their futures elsewhere: Three of the mayor's five children are grown and gone. So is a son of 2nd Ward Commissioner Watkins.

"We've got an unemployment problem here, but God knows, you can't blame anyone for that," said Robert Davis, who returned home from Yale 30 years ago to run his family's clothing business.

"Racially," he said in defense of his city, "I don't know a black anywhere who can't complain of discrimination. Our situation here is no better nor worse than anywhere. The things blacks have to complain about can't be legislated. Unfortunately, certain leaders make a noise, and the city press comes running. We resent it."

But in this bleak economic setting, civil rights rhetoric with an almost nostalgic quality is being heard again from the likes of Sarah Nichols, a Cambridge native who works here but lives in Hurlock, 12 miles away.

"I'm ready to march," said Nichols, who has emerged as the most vocal of several black voices raised in anger.

"Some people say it's not nice to do, but until they marched in the 60s, they didn't get anything," she said.

One of those who marched was Lemuel Chester, arrested with Rap Brown in 1967. But now, a recovered alcoholic at the age of 33, Chester is committed to "breaking down the barriers of injustice through the system." He manages a federally funded community center in a converted garage he recently declared off limits to Sarah Nichols and her group.

"There are not supposed to be any political meetings at all," he explained to a visitor. "In the (prior) meeting, the suggestion was made of taking to the streets. Under our guidelines, that's considered subversive. It could have a negative effect on our being refunded."

"Sarah Nichols has guts, but it can be counter-productive," said William D. Barnes, the black manager of the state unemployment office here. "Industries don't want to move in because they want to avoid trouble."

Nichols and others reviewed their complaints recently for the visiting Maryland Human Relations Commission. They told of too few jobs for blacks in banks, stores and government, of decrepit housing and inadequate code enforcement, of rude treatment in some shops and in one restaurant.

"We'll follow through," pledged executive director David Glenn after listening to four hours of anger and frustration. But he promised no quick panaceas for the more intractable problems of society.

"I haven't heard any complaints," State Sen. Frederick C. Malkus Jr. said a few days later in his law office facing the antebellum county courthouse. A long and bitter opponent of civil rights laws in the '60s, Malkus said that Cambridge had been "misaccused from the beginning. We were in the forerunner (sic), as far as race relations were concerned. I got more colored friends than most of the so-called liberals."

Nearby, in a second-floor walkup on the town's main street, Paul E. Coleman, who is black, complained. "The attitude hasn't changed drastically," he said. "It is still a very segregated town. "It's a nice place to visit, but you wouldn't want to live here."

Coleman is deputy director of the Dorchester County Development Corp., the funnel for federal antipoverty funds. "We're here to eradicate poverty," he said.

"Our manpower division teaches trades, but when you get the skill, there's no place to implement it."

The unemployed and the retired pass the time in front of Jones Market on Pine Street. Across the street is the "amphitheatre" built by black youths trained with Development Corp. funds. It's a cinder block wall, a concrete stage and brick borders overgrown with grass. It stands on the site of a black school torched in 1967, an ambiguous monument that residents say serves no purpose and is unused except as a dumping ground for liquor bottles and beer cans.

A few blocks away, a 1.4-acre playground known as Cornish Park and used by children of the 2nd Ward is another monument -- this one, residents say, to white neglect.

The city spent $10,000 on landscaping and new play equipment for Cornish Park in 1976, while nearly $150,000 went to rehabilitate yacht slips and build restrooms and shower facilities at Long Wharf Park, which adjoins a white neighborhood and the Cambridge Yacht Club, which has no black members.

Because of this, the federal office that controls revenue-sharing funds threatened to cut off further grants to the city, charging that Cambridge discriminates against blacks. The city has appealed the finding.

"In no other ward has the city provided a playground," protested Mayor Albert B. Atkinson. "What you could have here is reverse discrimination. You could end up with a Bakke case here."

The city, meanwhile, has recently published plans for a downtown shopping mall and renewal of the commercial waterfront. But funds are budgeted for only one housing code inspector and there is no overall program for dealing with the city's serious low-income housing shortage.

The city's "spear thrusts" into the black section, said federal grants administrator Ray Willis, include funds to help homeowners, who make up a small minority in the 2nd Ward, and to facilitate the building of 21 duplex units on property owned by a local slum lord. Groundbreaking for 120 housing units for the elderly has been repeatedly postponed. It is not scheduled for next month.

Mayor Atkinson is quick to concede the city's failure to solve its housing problem. The shortage has become so acute that the Cambridge Housing Authority, which manages 190 units but has a waiting list of 200, bought newspaper ads last week to stop the flood of applications.

James B. Yates, who as state's attorney in the 1960s prosecuted black protesters, now sits in judgment of their landlords. He is a District Court jurist but is reluctant to act against substandard housing.

"I've been accused by being lenient," the pipe-smoking judge said at the High Spot Restaurant near the courthouse. "But you can't arbitarily force people out of the place they're living in. They have no place to go."

Over on Moore's Avenue, people live in two rows of chicken coops converted years ago into housing units.Two other families live nearby in what was once a stable for horses. The chicken coop houses sit close to the ground.During a heavy rain, the water rises through the floos, warping the wood and damaging the furniture.

"Everywhere we went to complain, they turned us down," Elois Camper told a visitor to her section of an old chicken house for which she pays $65 a month rent. "They kept sending us to this person and that person."

Her landlord, Gorton McWilliams Sr., owns about 20 properties in the 2nd Ward. His father was a city commissioner, and his son now has the job. McWilliams blamed the city for the water damage. The city, he said, had failed to clear a drainage ditch of underbrush.

"He's right. It hasn't been cleared for years," said the city public works director, who promised action next month.

Another 2nd Ward landlord heads the Cambridge Human Relations Commission. City neglect in the 2nd Ward is a "a disgrace," said Robin M. Kirwan, a former packing company executive who also worked for the State Department in Latin America and owns about 50 properties here.

Kirwan is one of black Cambridge's better white landlords, according to his tenants on Camper Street, which dead-ends behind a baseball park at the ward's northeast corner.

Kirwan's human relations commission has no power to investigate complaints and its meetings often are canceled for lack of a quorum.

"We meet every month to do nothing, to do absolutely nothing," said Enez Grubb, vice-chairwoman and one of seven blacks on the 15-member panel.

"There are a lot of legitimate gripes," Kirwan said. "But you get one or two firebrands, you're always subject to problems. I guess maybe they don't believe in working through the system." :'You can't arbitrarily force people out of the place they're living in. They have no place to go.' CAPTION: Picture 1, Goldie Mae Jackson sits in front of her $80-a-month home with its broken screen door. By Fred Sweets -- The Washington Post;Picture 2, Children play in the road as many streets in Cambridge's 2nd Ward have no sidewalks or gutters. More than 4,300 blacks live there.; Picture 3, Judge William P. Yates is reluctant to act against substandard housing.; Picture 4, Sarah Nichols stands in front of "amphitheatre" built by black youths, but not derelict.; Picture 5, Lemuel Chester, community center manager, was a Jaycee "Man of the Year" nominee.; Picture 6, Wearing Jaycee jacket, Tyrone Seymore tells how he was welcomed to a meeting.; Picture 7, Elois Camper enters her home in a row of sagging converted chicken coops that are flooded by heavy rains. She pays $65 a month rent.