Acton Institute Powerblog

The Death Of Detroit’s Middle Class

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Detroit is bankrupt. The city government can’t pay its bills. Scores of empty houses and garbage-strewn lots greet anyone who drives down once-bustling streets. There is a lot of finger-pointing, and no easy answers. There are a lot of pieces to the puzzle of what went wrong in Detroit.

At The Wall Street Journal, Steve Malanga has a few puzzle pieces to add, and they form the face of former-Mayor Coleman Young. Young was Detroit’s mayor for 20 years (1974-1994), and Malanga calls him a “radical trade unionist who ran as an antiestablishment candidate reaching out to disenfranchised black voters, Young lacked a plan except to go to war with the city’s major institutions and demand that the federal government save it with subsidies.” During Young’s 20 year mayorship, the city’s government became less and less effective, and the middle class (both black and white) got out.

Malanga contends that while Young was voted in as a candidate of reform, the reforms he brought were negative.

He divided the police department along racial lines, creating separate layoff lists of white and black officers. He and his handpicked police chief, William Hart, made clear that policing that resulted in too many arrests or citations in the black community would not be tolerated…Young’s divisive brand of governing extended to economic policy, such as it was. When General Motors agreed to build a new plant in the 1980s to help the city’s revival, Young and GM targeted the still vibrant, largely white ethnic neighborhood of Poletown to locate the facility. In one of the nation’s most infamous cases of eminent domain, the city sued in 1981 to raze some 1,500 homes and 144 businesses and displace 3,500 people.

Unfortunately for the people left in Detroit, their leadership didn’t get better. With the election of Kwame Kilpatrick, Detroit was left with outright corruption instead of inept economic policies. Kilpatrick is currently serving out sentences for 24 counts of racketeering and fraud.

Today, Detroit is an estimated $18 billion in debt including a $3.5 billion pension shortfall. Its population has shrunk to under 700,000 from 1.84 million in 1950. Unemployment is at 16.3 %, and the number of jobs in Detroit has declined by more than half since Young became mayor in 1974. The city’s auto manufacturing base has shrunk despite the bailouts of GM and Chrysler, as those jobs moved to the likes of Kentucky and Alabama.

There are a lot of reasons Detroit is the way it is today, but Malanga makes it clear that Coleman Young did great harm to a once-great city.

Elise Hilton Communications Specialist at Acton Institute. M.A. in World Religions.


  • Curt Day

    Perhaps you can comment on the story linked to below. It says that Michigan leads the nation in tax breaks for corporations

    Corporate tax breaks

    • Cronyism should not be surprising.

      • Curt Day

        the question is, is it an aberration or an indication that the system needs fixing?

        • Sure, it needs fixing. I just don’t think we have the same kind of solutions in mind.

          • Curt Day

            That is fine, at least we can celebrate where we agree. I remember talking to some conservative Christian counter-demonstraters at this year’s May Day celebration in NYC. First, I surprised them because I share their conservative faith but am a political leftist–not to be confused with a liberal. Second, as we were talking, we enjoyed discovering those areas on which we agreed. And we agreed in some of the problems we both identified as needing to be addressed. But like us two, we had different solutions. But at least we conversed with and listened to each other.

  • RogerMcKinney

    Since the news broke I have listened to hundreds of opinions on why Detroit went broke and almost none are informed by any kind of economics. It should be no mystery because cities have gone bankrupt for centuries, as have states and national governments. The problem is almost always too much spending and too high taxes. High taxes drive people to locate in lower tax areas, which reduces tax revenue. Most cities respond by raising taxes which only makes the problem worse.

    Crime rates also contribute to middle class flight. Most cities waste billions on convention centers and stadiums, the cost of which forces them to neglect police and roads.

    Of course, unions have done the same damage to Detroit as they did to the auto industry and most manufacturing.

    It ain’t rocket surgery. We’ve seen this sort of thing for centuries. Unfortunately, most voters in cities like Detroit think that high taxes lead to prosperity. About ten years ago the city of Tulsa released a report praising Michigan’s high taxes as the road to prosperity. Unfortunately, Tulsans believed it and now the city finances are a disaster.

    • Curt Day

      You view does not take into account corporate values that might be causing corporations to bite the hand that feeds them because perhaps they they think they can find other hands.

  • George F. Will explains Detroit’s demise and the “IBG, YBG” ethic:

    Kevyn Orr, Motown’s one-man show

    On RealClearPolicy, James V. DeLong writes about “Detroit and the Special-Interest State” but mostly about the national problem of “capture by faction” which is leading to “huge and growing systemic corruption, as the beneficiaries tithe to whoever promises to keep the benefits flowing. Business has given up on efforts to support a market economy and devotes itself to competitive crony capitalism. For example, as George Gilder recently wrote in Knowledge and Power, the alternative-energy scams are ruining Silicon Valley by triggering a ‘general Gadarene rush for green subsidies’ and ‘transform[ing] venture capitalists from heroic contributors to American innovation . . . into a pack of grubby petitioners for pork.'”

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