That the price of a house in Detroit can cost less today than a new car seems one of the great ironies of 21st century America. But no major city has been harder hit by the recent recession, or by the decades of manufacturing attrition that preceded it, than the Motor City.
It’s famously lost a quarter of its population in the last decade and 60 percent since 1950, and now sits on the brink of bankruptcy. “We are at a critical and pivotal time like none in Detroit's history,” Mayor Dave Bing said in his state of the city speech Wednesday.
In his forthcoming book, Detroit: A Biography, journalist Scott Martelle details how the city – felled by one of the great innovations of the industrial era, a grave lack of official foresight and swirling poverty and prejudice – has come to redefine urban collapse.
Martelle starts his story at the beginning, with French naval officer Antoine Laumet de Cadillac beaching his canoe on the north bank of the Detroit River in July 1701 and establishing Fort Pontchartrain.
Economic boom-times arrived with the 1825 opening of the Erie Canal, a key shipping link to the East through which boatloads of iron ore, copper, coal, and lumber from the Lake Superior region passed.
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Detroit's population neared 300,000 at the turn of the century, just as Ransom Olds, David Buick, the Packard brothers and Henry Ford began their battle for automobile supremacy. By 1914, Detroit was making half the country's cars. By 1929 it was the fourth largest city in the country, with a thriving economy, a population of 1.6 million (nearly 160,000 working in the auto industry) and impressive new roads and skyscrapers.
Yet it was built on sand. Martelle points to Henry Ford's great innovation, the conveyor belt-driven assembly line. “It was the first critical step in the dehumanization of manufacturing work,” he writes. “Skilled craftsmen lost out to unskilled laborers who performed a single task, day in and day out.”
The line became standard across the industry and wages fell, leading to protests and ultimately the creation of the United Auto Workers union. Yet by providing decent-paying jobs to the least skilled, the assembly line dictated that future Detroit workers would rarely need more than a high school education or any skills that might help them find work beyond the most menial jobs.
“It drew to Detroit the relatively uneducated, made Detroit a magnet for the lower economic strata, from the South and other parts of Midwest,” says Martelle. “Obviously you need laborers, but this skewed the balance.”
And in a free market those jobs would constantly seek out the cheapest labor. General Motors sniffed the changing winds long before most, opening factories as far afield as Europe, South America and, in 1929, that godhead of outsourcing, India.
The Great Depression hit Detroit hard. Auto production fell by three-quarters in just three years, forcing tens of thousands of layoffs and countless foreclosures. Major banks faced insolvency.
By 1940 the industry had rebounded, converting plants to build tanks, planes and various other vehicles and spare parts for the war effort. Detroit's economy hummed again, and half a million people arrived looking for work, mostly African-Americans from the South.
After the war, the big automakers went back to their old ways. Cars sold in record numbers, driving a booming local and regional economy. Depression-era troubles had failed to convince Detroit officials to diversify.
“It was a lack of imagination,” says Martelle. “The leaders saw people buying cars again, and thought, ‘making cars, that's what this city does best.’” That decision, Martelle argues, played a major role in the city's eventual collapse.
“It's hard to imagine Detroit would be in its current condition if the post-war economy had diversified significantly beyond auto-making,” he writes in the book.
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Later opportunities to point the city in a better direction came and went. Martelle chronicles the 1949 election of Mayor Albert Cobo, whose anti-integration, slum-clearing policies helped spur the exodus of whites to the suburbs, the devastation of the 1967 riots and the years of crime, drugs, and gang violence that followed.
Along the same timeline, the Big Three were busy decentralizing their operations. By the early 70s, one out of every three dollars invested in the major automakers was heading overseas.
The 1973 oil embargo, the subsequent race to increase fuel efficiency and the rise of Japanese automakers like Honda proved the straw that broke the city's back. Within two years, U.S. auto production had fallen nearly 30 percent, and Detroit was well on its way to becoming a byword for urban decay.
Martelle intersperses his narrative with a handful of telling resident bios. Michael Farrell buys the century-old, long-neglected Taylor House mansion in Brush Park for $65,000 in 1981. He hopes to revive the neighborhood and achieves modest success until the financial crisis steals his momentum. With no grocery store or retail of any sort, today the area is known mainly for its Victorian “ruins porn.”
“When you lose the commerce, you lose the city,” Farrell tells Martelle in the book. “Detroit has no commerce.”
Yet encouraging signs have appeared. John Thompson grew up in rough-and-tumble Cass Corridor, where he opened Honest ? John's Bar and Grill in 2002. An independent bookstore, a creperie and an art movie house have since followed, along with a trickle of new residents, providing what Martelle calls “a little shoot of new urban intensity.”
A modest uptick in the auto industry has meant new jobs, but mostly outside Detroit. Companies like Dan Gilbert's Quicken Loans and Blue Cross Blue Shield have begun reinvesting in Detroit's downtown, creating thousands of jobs and incentives to new residents. Nonprofits like Skillman Foundation and Kresge Foundation work to rebuild and preserve neighborhoods via education and engagement.
Still, these are tiny slices in a vast city of 140 square miles. With about $40 million left in the bank, Detroit is essentially bankrupt, and facing a deficit of $200 million. Since taking office in mid-2009, Mayor Dave Bing has cut nearly a quarter of his workforce and enacted a 10 percent pay cut for the rest, cut garbage pick-up and police patrols in large swathes of town and recently asked for a $150 million loan from the governor. As if that weren't enough, the Detroit public school system is considering closing half its schools.
Pittsburgh, another single-industry city that collapsed in the 70s and 80s, has in recent decades begun to rehabilitate itself. In 2010, more than one in five jobs in the region were in education and healthcare, nearly a 20 percent increase from 2000. The focus on these sectors as well as finance and technology has drawn a new wave of immigrants.
Martelle sees the legacy left by steel magnate Andrew Carnegie in that city as crucial. Carnegie Mellon University is a top research and academic institution, while the Carnegie Institute operates four respectable museums. Together they establish strong educational and cultural roots.
Henry Ford, on the other hand, created the Ford Foundation, which has been based in New York for decades. “That's a lesson for other urban areas,” says Martelle. “Try to draw corporations into creating institutions that could sustain the community in the future.”
Photo credit: Eric Thayer/Reuters