The origin and resolution of the Faunus Rights Revolution
The Vytal Accords promised to recognize faunus as equals to humans, restricted only by the same laws and afforded the same protections.
This proved far more intolerable to humanity than allowing the faunus to live among them as second-class citizens or worse. Therefore, the new republic governments of at least two kingdoms declared Menagerie to be the legal property of all faunus and attempted to exile all of them to it.
Hypothetically, had the Last King of Vale not given sovereignty back to the conquered kingdoms – had he become a global emperor – he could have enforced racial equality from the top down, instead of allowing democracy to choose evil. But I do hope that General James Ironwood's example in Volume 7 proves why benevolent tyranny feels like any other form of tyranny to the people, and so inspires rebellion rather than cooperation.
Indeed, I would posit that instituting representative-democracy opened a door for racial equality and integration.
Herd Mentality
As Marrow Amin observes, "This society is set up for faunus to be at the bottom, and humans are willing participants. They benefit from doing nothing to help us. But there are still those who actively abuse us."
The issue is two-fold: The spiteful minority who drive the problem and the indifferent majority who allow it.
Most people simply want to be left alone to live their lives. Grow up, master a trade, get married, raise the next generation, repeat; that's life. The freedom to go on living that simple life is worth putting up with almost anything, and especially ignoring anything which doesn't inconvenience them.
Thus most humans do little or nothing to improve the circumstances or treatment of their faunus neighbors, and the faunus who lived in Kuo Kuana wanted to ignore the White Fang's attack on Haven Academy. The Belladonnas found it difficult to motivate their people to risk their peaceful lives and commit to war against the White Fang.
Tribal Mentality
The Last King of Vale and other egalitarians of his day found it difficult to motivate the indifferent majority to trust or care about the faunus. Meanwhile, the spiteful minority apparently found it much easier to promote their values, in no small part because they likely outnumbered the egalitarians.
Ethnic tribalism. Humans consider other humans part of their "tribe", with faunus being "the other". It is the nature of people to extend more trust and forgiveness to other members of their group, and to be more mistrustful and unforgiving to anyone outside of that group. It is the same for the faunus, especially those who joined the fight in the White Fang or left it entirely for Kuo Kuana.
Only Vacuo defines tribes entirely by civic identity, regardless of ethnicity. Or, at least, Vacuo doesn't regard "faunus" as a distinct ethnicity.
The Spiteful Minority
In the past, the spiteful minority found it easy to exploit the faunus, since only a minority of people in a monarchy have institutional power, and the indifferent majority have none. The majority had little power to stop the powerful minority, so the minority is rewarded for exploitative, abusive practices, and the majority has little motivation to help the weak minority being targeted with the worst of those practices.
Then the Last King of Vale gave the majority the power to choose who would have power; not just the humans, but also the faunus. The powerful minority panicked; bad enough that they must now promise to serve the will of the majority in order to remain in their customary offices of power, but they would need to promise to serve the interests of the faunus. The faunus could potentially vote other faunus into those offices instead, or at least elevate members of the majority into their elite club. So the powerful minority decided to get rid of the faunus.
In the past, they could do this regardless of the will of the majority. Now they needed to convince the majority to agree, and they didn't care how.
Exiling the faunus would leave whatever property they owned behind for the taking, so the powerful minority could promise to "redistribute" that wealth to the financially-poor majority. No need to actually fulfill that promise in the end, of course. As the ones in charge of distributing the property, the powerful minority could keep plenty of it for themselves and give the rest only to those members of the majority who served them best.
Aside from appeals to greed, the powerful minority could also appeal to fear. "The faunus will take your jobs, their men will take your women, their women will seduce your boys, they'll want to move into your neighborhoods, they'll demand reparations and take revenge," etc, etc.
Anyone who didn't succumb to greed or fear, who stood up for the faunus, the powerful minority labeled as "race-traitors" and "animal-lovers" and targeted with anonymous violence from masked assailants, thus exploiting herd mentality and tribal mentality to silence dissent and debate.
The Indifferent Majority
Thus the indifferent majority of humans decided it would be more unpleasant to make an enemy of the powerful minority of humanity than it would be to follow the minority's lead and close ranks against the faunus. In that regard, the majority's complicity in the Menagerie Exile plan was no different from its complicity in any of humanity's previous crimes against the faunus.
But a democratic-republican system made the majority more directly responsible than they'd ever been before.
When the faunus decided to fight back, humanity found itself paying a higher price than it estimated. The ruling minority felt the least of the cost, but the majority who paid the taxes, fought the battles, suffered the wounds, and looked the faunus in the eyes...
Well, the faunus forced the indifferent majority to choose. Which seemed more unpleasant? Continuing to fight and die for a cause that wasn't really its own, or standing up to the spiteful minority and putting an end to the war only that minority wanted?
Conclusion
The indifferent majority accepted its responsibility for the fighting, and began to exercise its new powers of self-governance to bring the elite to heel. Thus the war ended.
That wouldn't be the end of the spiteful minority. They would simply retreat, disappear, reinvent their image, and worm their way back into power more subtly. Apparently realizing this, the faunus established the White Fang to continue the fight with that minority in a war of laws, words, and public opinion.