Spotlight on Detroit

Detroit, once America’s fourth most populous city, has filed for Chapter 9 bankruptcy. Detroit is by far the largest city in the United States to take this desperate course of action. Having grown up in Detroit, I have noticed how the city’s problems have evolved and the repercussion on friends, family and the wider community. In this blog I would like to take a look into the background of this crisis and consider what the future holds for one of America’s largest cities.

Though now difficult to believe, during the early 20th century the city of Detroit prospered and expanded rapidly, rivalling neighboring cities such as New York and Chicago. Built upon the emerging auto industry, workers’ unions and a revolution in assembly line manufacturing, Detroit was once an attractive and thriving metropolis.

Detroit

However, shortly after World War II, decay crept into Detroit. This decay had multiple causes, including the US economy’s move away from industrial production. Also instrumental in the fall of Detroit was the ‘great white flight’ of former middle class city dwellers into the surrounding suburbs. Most large industrial cities balanced suburban expansion by annexing bordering neighborhoods to ensure the tax revenue of surrounding suburbs continued to support the urban center. This failed to occur in Detroit.

Detroit’s decline was spurred on by the city’s racial politics of housing and suburbanization.

As Thomas J. Sugrue argues, in The Origins of the Urban Crisis, that Detroit’s decline was spurred on by the city’s racial politics of housing and suburbanization. 8 mile road, a division between Detroit’s vast city limits and the prosperous surrounding suburbs, is more than a physical divide. It is a physical and social boundary between Detroit city center, with its dreadful school districts, lack of services and a declining tax base, and the extremely affluent surrounding suburbs, which boast some of the best schools in the nation.

By the 1990s, the state of Detroit’s infrastructure, buildings, streets, schools and parks had deteriorated so badly that the photographer Camilo Jose Vergara earnestly suggested turning downtown Detroit into an aesthetic skyscraper ruins park. Detroit’s population dropped by the equivalent of that of the New Orleans metropolitan area within 60 years, from 1.8 million to 700,000 people. It is now filled with abandoned buildings, vacant lots, and unlit streets. Once home to 296,000 middle class jobs, only two car factories are left within Detroit’s city limits, employing about 28 times less people.

However, I believe that Detroit’s biggest problem is its low density. The city has a huge geographical area to provide services to – it is larger than Boston, Manhattan, and San Francisco combined.

Credit: Dan Pitera of the University of Detroit Mercy 2009

Credit: Dan Pitera of the University of Detroit Mercy 2009

Detroit is bankrupt

Just over 60 US cities, towns, villages and counties have filed under Chapter 9 since the mid-1950s. The debt in Detroit however, dwarfs all other cities who have previously filed. Jefferson County, Alabama, which was the nation’s largest municipal bankruptcy, filed in 2011 with about $4 billion debt. Best estimates placed Detroit’s debt to creditors at around $18 billion.

Debt breakdown

What does this mean for Detroit? A number of bankruptcy experts and Detroit city leaders are concerned about the fallout of a bankruptcy filing. They anticipate benefit cuts for city workers and retirees, reductions in services for residents, and a detrimental effect on Detroit’s ability to borrow money in the future.

Unions representing workers and pensioners are particularly worried. Union leaders across the US are watching closely to see if Detroit decides to cut pension benefits, despite a provision in the State Constitution that union leaders say bars such cuts. “If you end up with precedent that allows the restructuring of retirement benefits in bankruptcy court, that will make it an attractive option for cities,” states Karol K. Denniston, a bankruptcy lawyer with Schiff Hardin. “Detroit is going to be a huge test kitchen.”

Detroit’s Mayor and elected City Council still hold office and are permitted to make decisions about day-to-day city operations. However, Detroit’s Emergency Manager can suspend or even remove these powers. This could cause a problematic democratic deficit.

Around 40% of the city’s streetlights do not work, according to a report from Detroit’s Emergency Manager’s office. And more than half of Detroit’s parks have closed since 2008.

Another major concern for Detroit residents remains the possibility that services, already severely lacking, might be further diminished in bankruptcy. Around 40% of the city’s streetlights do not work, according to a report from Detroit’s Emergency Manager’s office. And more than half of Detroit’s parks have closed since 2008.

A positive future for Detroit?

Despite the widespread concern, the fear of becoming the global example of bankruptcy and decay has not infected many of Detroit’s citizens. Residents still see Detroit’s potential as the city of tomorrow. Economics professor Mike Dicks says, “Detroit has the greatest opportunity of all major US cities. Over 75,000 vacant buildings, 2/3 of their population gone, and almost 75% of the city area abandoned, now with bankruptcy they have the potential to remake themselves into a new era city second to none.

People, and in particular young people, are still drawn to the city, what it represents and its potential. In response to urban decay, a rebellious art scene, tech startups, organic restaurants, film studios and a premier music community (including the likes of Aretha Franklin, Madonna, the White Stripes and new rockers like Dale Earnhardt Jr. Jr.) have the possibility of revitalizing the city of Detroit.

Rather than succumbing to decay, many citizens of Detroit seize this as a unique opportunity to evolve and grow, bringing art, culture and green space back into the city.

There is also a prodigious urban gardening movement blooming throughout Detroit. The repurposing of vacant lots into urban gardens provides both fresh food and employment for local residents, in a city notoriously lacking supermarketsand employment opportunities. Rather than succumbing to decay, many citizens of Detroit seize this as a unique opportunity to evolve and grow, bringing art, culture and green space back into the city.

As a child growing up in the suburbs of Detroit, I experienced a powerful attraction to the city center. Those who see the inherent value of a thriving city are at this moment looking for creative ways to maintain and improve Detroit. Urbanismmeans preserving and adapting cities in spite of economic or political trends that threaten them. People are drawn to the energy, opportunity, history, culture and hub that is Detroit. Despite urban problems and decay, the appeal of a vibrant city center does not die, and for this reason I have high hopes for the future of Detroit.