Having worked in downtown Detroit for 30+ years and lived in a Detroit suburb during that time, I believe much of the problem boils down to issues of crime and personal safety.
As a non-resident, I still paid city taxes, and I thought of it as paying for my safety. It was illusory, but comforting. I was still very careful and cognizant of my surroundings when walking and driving in the city.
As long as companies attempting to support the city by relocating downtown have to resort to paying extra “combat pay” to get their employees to go along with the plan, you have to acknowledge that people still do not feel safe from crime and criminals. The extra pay will be publicly framed as a parking subsidy (because yes, parking is expensive in the city and free, generally, in the suburbs) but it’s common knowledge that it’s a bribe to get you to work in the city.
My aunt and uncle had a lovely home in Detroit, in a nice neighborhood. In the 70’s, things started changing. “Hit 8 Mile” became a mantra. They were robbed at gunpoint twice by thugs who broke into their home, and once were carjacked in their driveway. Not being stupid people, they walked away from their home and moved to a suburb. Their old house sat on the market for years, unsold, and was finally torn down.
Another factor, which doesn’t seem to get much media play, is the “no snitch” culture. Witnesses refuse to come forward, and crime and criminals flourish. Police are stymied in their efforts to deal with it, and people continue to flee the city. As soon as they can scrape a few bucks together, they leave. I don’t blame them.
The State of Michigan isn’t much better off than Detroit. And Detroit is dragging the rest of the State down with it.
*Originally Posted by doorhinge
Does it really matter, at this point in time, why Detroit collapsed? There’s plenty of derfingerpointen to go around but the only question that matters today is - How do you bring taxpayers back to Detroit?
This isn’t rocket surgery. Detroit can’t pay it’s bills. Detroit doesn’t seem to be able to get its collective act together and make a go of being a city.
What choices are available to Detroit “today”?*
“How do you bring taxpayers back to Detroit” and “What choices are available to Detroit “today”” is not the same as "“How can Detroit fix Detroit’s problem”.
While a discussion of Detroit’s glorious history of failures might make for an interesting cultural study, it won’t fix the problem. I guess it depends on what you believe “the problem” to be. I believe “the problem” is - How do you revitalize Detroit?
If you want to study city histories, I suggest you look to the cities that have sucessfully managed to revitalized their downtown and residentual areas and successfully re-energized their job markets.
IMHO, the first line in your post is the important one. Pittsburgh successfully transitioned from a “making things” town to a 21st century service economy city, but the rest of PA was doing okay. All of Michigan is a big fucking economic mess.
I think large metropolitan areas should have two layers of government: a metropolitan government which covers the whole metropolitan area and handles metropolitan scale issues and cities of no more than 100,000–preferably less. So I suggest cutting Detroit into a dozen pieces or so. The smaller size cities will be more responsive to their citizens.
And the laws against sleeping under bridges apply equally to the wealthy and the homeless. There are more resources around the city because the suburbs have dragged it down.
So those lucky duckies living in the city are paying lower tax rates than you?
What I (and now Brainglutton am saying is that the legislature might change the law.
I have suggested that the enlarged Detroit form a new government. Hopefully bringing in enough whites to make the Republican Party viable.
Michigan isn’t in a great situation but it’s hardly comparable to Detroit. It’s not hopeless. Yes, it doesn’t have unlimited resources to bring to bear but there are things it could do. Detroit as it is cannot continue. Reform is needed at the state and federal levels. If the state would act to force the region to act cooperatively the outlook would immediately improve. Greater Detroit is not a losing proposition. If the federal government would end its fanatical pursuit of job killing Free Trade policies then manufacturing could limp along a little faster.
So how would you suggest we begin revitalizing Detroit? Because I don’t see how it is possible given the current conditions. The deck is just stacked too hard against the city.
I was born in Detroit (both grandfathers and father and uncle commuted to work in the city) and now live outside Pittsburgh. The timing of the crash here was better. As you say, there were more resources to bring to bear because the nation and state weren’t yet stretched so thin by our foolish trade policies. Also don’t discount geography. Detroit is flat and on the grid. People there complain about traffic but would hate coming here where there are mountains and tunnels and bridges and roads going every which way to deal with. My wife and I often talk longingly about the “Detroit left” when waiting for minutes for the various roads coming together to have their turn to turn or proceed. Commuting is naturally more difficult here which has slowed decentralization. It still occured and still leads to an appalling lack of social justice. But it has left us with a working business community. Even if anyone who can gets out of Dodge before it gets dark. Pittsburgh is the opposite of the old “sundown towns”.
I appreciate the point of view you are bringing to this conversation, but I have a few questions. The situation you described does not appear to be all that unique to Detroit to me. What about a city like Dallas? They had the same sort of white flight issues. The suburbs are stand alone cities not contributing to the city of Dallas tax base. Numerous large corporations moved to the suburbs. Why isn’t a city like Dallas on a continuing downward spiral like Detroit? The city of Dallas, like most urban cities, also has predominantly Democratic rule, a higher percentage of minorities than the surrounding areas, and higher crime than the surrounding areas. Today, Dallas, like many other cities, is experiencing reverse white flight as whites are sick of dealing with the ridiculous commutes that come with suburban living.
When you talk about the tax base of Detroit, should it not also be linked to the tax base of Wayne County? Aren’t there county taxes? Don’t county taxes pay for some of the county services that would benefit the city of Detroit? Aren’t some of the wealthier suburbs located in Wayne County also?
The cities don’t subsidize the suburbs, the suburbs subsidize the cities.
The biggest cost that the municipal governments have on behalf of the citizens is education, and the suburbs pay for all of that themselves.
Generally, major cities will have lower tax rates than suburbs, because they are the beneficiaries of real estate taxes from commerical buildings whose rent-paying abilities are derived from the work of people who commute in from the suburbs and who cost the cities very little in services.
People who live in the suburbs pay more to the government than people in the cities, but they endure it because the quality of life is higher for family-oriented people.
Detroit’s financial problems are almost entirely the result of generous pensions to city workers, and by the mismanagement of pension funds by corrupt trustees and politicians.
You can also trace Detroit’s problems back to political corruption and an attempt to ‘gerrymander’ the city by punishing the people who didn’t vote for the corrupt politicians. At one time, "white flight’ was considered a feature by the ruling politicians - it strengthened their voting base.
In addition, Detroit has an ‘at large’ city council rather than a ward system. This ensured that the council was more concerned with partisan politics and rewarding cronies than actually looking after individual neighborhoods. In most cities, if you’re unhappy with services in your neighborhood, you hold your alderman accountable, and kick him or her out of office if you’re not happy. In Detroit, no one is responsible for your neighborhood. And the council has ‘larger issues’ to consider.
We can also add an astounding lack of foresight by the city government and a lack of willingness to attack the problem early when it would have been less painful. Detroit’s fiscal decline has been going on for decades. Rather than address root causes of white flight and erosion of the tax base, or to make modest changes early in the retirement benefits of workers, the city leaders continued as if nothing was wrong - borrowing more money, deferring payments, raising taxes, spending money they didn’t have on infrastructure they didn’t need while neighborhoods crumbled.
In short, the root problem for Detroit is decades of corruption and mismanagement by the government of Detroit. The decline of the Detroit auto industry was devastating, but the city was already in deep trouble by the time that happened, and other cities have survived and thrived after losing critical industry.
And of course, the decline of Detroit itself has a lot to do with over-generous pensions and salaries for auto workers. The auto industry in general is doing just fine - just not in Detroit. Instead, factories are expanding in states and countries with more reasonable regulations and tax rates.
The city government is elected. The people rarely elect people who tell them they will have to make sacrifices. They do elect people who tell them that other people will have to make sacrfices, but not them, and if dealing with the problem would require sacrifices from too many people it won’t be dealt with.
And there are always politicians who will run for office and promise the people that no sacrifices are really required of them, so as a practical matter, that’s going to be the dominant strain in a democratic political system.
In sum, the only way serious issues which require sacrifice get dealt with is if the blame and sacrifice can be pinned on a minority of the electorate.
And Detroit’s problems, stemming ultimately from the decline of the auto industry (& manufacturing generally) were broad enough that they would have required serious sacrifice from large portions of the electorate. Wasn’t going to happen.
Of course, this does not mean that there weren’t isolated inastances of poor decisions here and there. No doubt about it. But the underlying dynamic is as above.
[You’ll notice, BTW, that the federal budget deficit is also not being seriously addressed. The US fiscal situation will eventually be a lot worse, and when that time comes there will be all sorts of finger pointing at bad decisions and failure to make tough choices by today’s politicians. But as a practical matter, any politician who seriously calls for tough choices has a slim chance of getting elected to a position of real power, and there are few such politicians as a consequence of this.]
The first step it to complete the bankruptcy. That MAY reduce Detroit’s debt sufficiently to allow the current government to begin fresh. Yes, people are going to be financially hurt by this but the option is for the Detroit government to close it’s doors and no one gets paid anything. If that happens, the State of Michigan won’t be held responsible for Detroit’s debts. 50 cents on the dollar, 25 cents on the dollar, or zero cents on the dollar?
I heard one of the media outlet’s newreaders say that Detroit had over 100,000 creditors. That’s an awful lot of outstretched “pay up sucker” hands looking for the money they’re owed.
Maybe someone could explain if it’s possible for the city pensions to dissolve (or whatever it’s legally called) and hand the pensioners their fair share of the holdings? Here’s your pension in a lump sum. Good luck and goodbye.
Right now I’m non-homestead, so, yeah, those homeowners in the city are paying lower rates than I am. However when I occupy my house, my net taxes (not rate) are significantly higher than comparable homes (based on size, features) than in the city of Detroit, simply because it’s worth a lot more by virtue of not being in the city of Detroit. And my taxes pay for all kinds of cool services and good schools. My taxes are an excellent deal.
Another Detroit problem is that it’s simply too big. It should have broken itself up years ago. It wasn’t even until this year that there was such a thing as district representation! Here’s a neat map of what Detroit could have been (and aligns nicely with the new districts): http://datadrivendetroit.org/projects/city-council-elections-by-district/
There’s nothing special about Detroit, or even cities in general. Why is there so much romanticism? Break up horrible bureaucracies; let different communities try different things that suit them. The bad ones can emulate the good ones. New things can be tried.
Otherwise we might as well replace governments at all levels with one universal omni-government that makes everyone, everywhere, completely uniform.
The UAW says that the average pension for auto workers is $18k, but they also get Social Security, which a city or state pensioner might not get. I think you’re looking for easy answers and not doing the research.
Detroit city pensions are about averagefor the country. The problem is the number of retirees. Detroit has a very low city worker to resident ratio. Twice the number of city employees per resident as Charlotte which has a similar population. Because of people leaving the ratioof retirees to current city workers is 6 to 4.
What Detroit needs is new residents. The best way to attract them is to keep the streets safe. Whatever savings they get from bankruptcy needs to be put toward police. Let everything else wither but make the police the number one priority. When crime goes down the low price of real estate will bring people back to Detroit. As long as crime as high Detroit will get what it deserves.
There’s a limit to how much police can do in fighting crime. As long as a large percentage of the population is groups which have no real prospects in life other than petty crime or worse, you’re going to have high crime, regardless of police. Economic success itself fights crime because it offers people other options and/or attracts non-criminals to the area. But if you start off with fighting crime and try to build economic success that way, you’re fighting much more of an uphill battle.
Which is besides for the moral issues involved. These retirees who worked all their lives for the city are owed that money, and they have no options left at this point. It’s immoral to inflict suffering on them in the name of rebuilding Detroit. (I’m aware that the more the city goes under the less money there is for these retirees anyway. But there’s a balance here, and deciding that fighting crime is the number one priority and “let everything else wither” is overboard, IMO.)
The link between poverty and crime is almost entirely one way. For instance in the past recession the US economy has lost approximately 7 million jobs. Despite this the crime rate continues to fall and is the lowest level in almost 50 years. Another example is the 60s when the economy had one of the best decades in the country’s history and crime skyrocketed. Policedo have a measurable impact on crime. Estimates of the effect vary but just hiring 10 percent more cops can have a 3 percent drop in crime. Thisstudy estimates that every dollar spent on cops reduces the cost of crime by 1.60. These are studies done nationwide and Detroit hasmuch more crime than almost any other city so the benefits of reduced crime would be even more there.
I lived in NYC during the 1970s when crime was a huge concern and the population went down by 10%, over 800,000 people fewer lived in NYC in 1980 than in 1970. The population stagnated during the boom 1980s years, and then the police got serious about crime when Giuliani was elected. Crime has plummeted 77% and the city has regained all of the population in lost and more. There are a million more people who live in NYC than in 1990. Whenever I go back it is astonishing how much better things are there now. It still has high taxes, incredibly high rents, a poor school system, and bad politicians but it is safe and clean and people want to live there again.
I’m not saying that police have nothing to do with the crime rate. I’m just saying that there are other significant factors as well, and if things get as bad as Detroit seems to be, these factors might overwhelm anything the police can do about it.
NYC never got nearly as bad as Detroit is, and there was always a lot of business and economic opportunity (especially in Manhattan) even in the worst of times.
I’m afraid I don’t know much about Dallas. It’s also flat and subject to the same decentralizing forces associated with Detroit. I can only guess as to why it is in better shape. Perhaps it has a more diversified economy. Perhaps its industrialization happened later so it doesn’t have the same environmental damage. Perhaps it has less of a pension legacy. Perhaps since the lower labor costs there have slowed the effects of offshoring. Perhaps the surrounding state is in better financial shape. Really though this is just speculation.
In Michigan the counties are responsible for some of the infrastructure. Roads and such. And yes, there are county taxes which was the incentive for Grosse Pointe Shores to consider secession. And there are other ways in which nonresidents and nonresident businesses contribute to Detroit’s balance sheet. Balthisar covers some but there are more. But things have gotten so bad that it’s not enough to sustain the urban core. A fellow “expat” that I grew up with used to say that Detroit (meaning the region) is a doughnut. There is no center.
Is this the situation in Detroit? Here in Allegheny County the city of Pittsburgh has higher property tax rates than all but a handful of inner (also poor) suburbs and has a higher local income tax rate than anywhere else.
They pay more because they earn and spend more, perhaps. But do they pay as high a percentage?
You’ll excuse me if I don’t necessarily agree with your definition of “generous pensions”. Do you know what the pension liabilities are or is this just a feeling you have? (I’m not, however, questioning the accusation of corrupt mismanagement. I have a feeling that’s an ugly story.)
Ahem, I believe I’ve demolished the previous evidence you have offered for this claim. Not responding to a refutation is one thing. Continuing to put the claim forward after contrary evidence has been produced is quite another.
This is debatable. At large elections more accurately reflect the voting preferences of the electorate. You can just as easily claim that each neighborhood is better represented since all council members represent all neighborhoods. In practice I think that given the political corruption and one party rule it wouldn’t make any difference which system is used.
Assuming this is true, does it represent a lack of foresight? I mean, was it politically possible to curb pensions? Would avoiding pork projects (which bring in federal matching dollars) have saved enough money to fix neigborhoods? If accurate foresight shows that the situation is hopeless, is it surprising that corruption rather than results are used to stay in office?
