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Neal Peirce: Early indicators of a recovering Detroit

By Neal Peirce
Washington Post Writers Group

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Washington: Years ago I sat across a dinner table with Coleman Young, Detroit’s legendary and divisive mayor from 1974 to 1994. Young related a story of wielding a stick to subdue — in self-defense, he claimed — a corporate “goon” he thought was about to assault him in a United Auto Workers’ showdown with the Ford Motor Co. in the 1930s.

Detroit has always been a tough town. With post-World War II white flight leaving an overwhelmingly African-American city, its relations with its suburbs ranged from indifference to deeply race-tinged hostility. A city of 1.8 million people in 1950 is down to 700,000 — a staggering 61 percent decline in population.

Today, vast sections of Detroit’s 138 square miles are marred by vacant lots, burned-out hulks of buildings and abandoned storefronts. Rates of violent crime are alarmingly high; residents respond with metal bars and barricades on their homes. Police response time is a painful 58 minutes (the U.S. average: 11 minutes). Educational levels are low, and the schools lag alarmingly. Major retailers have long since decamped for the suburbs.

And recently the world has heard the alarming news: Detroit has become the biggest American city ever declared officially bankrupt. It is $18 billion short of the resources it needs to pay its massively underfunded pension and bond payment obligations — the equivalent of $25,000 per resident.

And there’s no doubt: The odds against early solvency are immense. Consider pensions alone: Detroit has only 3,200 active workers paying into a system that benefits 9,300 retirees. Although the average pension benefits are fairly modest by national public employee standards, bankruptcy proceedings may well pit retired workers against municipal bondholders for payment.

Against all this, it would seem amazing that emergency manager Kevyn Orr and Michigan Gov. Rick Snyder, a Republican, at the news conference announcing the official bankruptcy decision, stood at a lectern with signs declaring: “Reinventing Detroit.” In their remarks, both made it clear they understand a city can’t, like a private company, simply be liquidated in bankruptcy — that basic services, from lighting the streets to sewer service to answering 911 calls have to be maintained. His bankruptcy plan, Orr noted, includes a commitment to spend $125 million a year for 10 years to remediate blight and address the needs of Detroit’s citizens.

A doom-and-gloom scenario for Detroit is also defied by the spirited revival that is already occurring in just five square miles of the 138 — starting at the Detroit riverfront, then along the increasingly vibrant Woodward Avenue midtown corridor area to the so-called New Center where General Motors formerly had its headquarters.

Immense new private and public capital has been pouring into this area, also home to thriving public institutions — the Detroit Medical Center, the Henry Ford Hospital, Wayne State University (29,000 students) and the College for Creative Studies (one of the world’s foremost design colleges). Concurrently, young creative professionals are generating activity, “buzz” for downtown Detroit not seen in decades.

The area’s been invigorated by dedicated industrialist, sports team owner and urbanist Dan Gilbert, who moved his Quicken Loans firm, along with its 7,000 jobs, from suburban Farmington Hills to downtown. Blue Cross Blue Shield has moved thousands of workers into downtown as well, as have other major companies. Overall, close to $2 billion in new investment has come into the area. Now Detroit has a startling shortage of housing units.

Detroit area foundations — Kresge, Skillman, McGregor and Hudson-Webber plus the nationally based Living Cities — have poured impressive resources into the revival. Together with Chrysler and General Motors and business leaders, the foundations contributed no less than $100 million to help build a new 3.3-mile light rail line from downtown to Midtown — a scale of local contribution that former U.S. Transportation Secretary Ray LaHood hailed as “unprecedented.”

Making the new line possible was the Michigan Legislature’s creation, at Snyder’s urging, of a Detroit Regional Transit Authority — a move disgracefully resisted for decades by anti-Detroit suburban political forces. Now Orr is considering a plan to get neighboring, far wealthier jurisdictions than Detroit to make use of the city’s superior water and sewer operations — an efficiency move that could unlock $50 million to $150 million of regional resources.

Such moves suggest a brand new era of regional collaboration — pushed forward by state power — to benefit the big American metro region historically most resistant to it.

A huge agenda remains — for example, obliging Detroit homeowners to leave mostly deserted blocks the city simply can’t afford to serve with water, sanitation or police services. Mayor Dave Bing’s earlier plan to do just that got torpedoed by hold-out residents. Maybe bankruptcy can finally push his move forward, opening new lands for inventive experiments in urban agriculture.

One is reminded that as wondrous as democracy is, sometimes it takes a disaster or emergency to trigger rational steps long resisted by entrenched forces — ethnic, political, regional, sometimes just neighborhood-based. Detroit is clearly there, as frightening as bankruptcy, at first blush, may seem to be.

Peirce is a Washington Post Writers Group columnist. He can be emailed at

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