Volume I

1. Contemporary Detroit: a metropolis of contradictions

When an ordinary American hears the word ”Detroit”, several images might come to their mind: the once glamorous Motor City that was synonymous for the whole American car industry and even for the whole manufacturing sector in the USA; one might remember the past as the 'good old time', where the primary product of Detroit, the automobile, made nearly every American family a proud car-owning one, advancing them to the “American Dream”. Nevertheless, today, a lot of Americans prejudge Detroit as a poor city, which is devastated by blacks. They are – in the point of view of many whites – supposed to be violent, criminal, drug addicts and driving the business out of the city.

For many middle-class whites in the U.S. Detroit resembles what is going wrong in America, stated in the saying “as Detroit goes, so goes the country” – but how much of this viewpoint is right and what were the reasons for the obvious transformation?

To make it clear right at the beginning: metropolitan Detroit is not a poor place in general: the mostly white inhabitants of the suburbs enjoy a high wage income and very good living conditions. However, the City of Detroit, the core of the metropolitan area, suffers from poverty and unemployment.¹ In the year 2000, 81,6%² of the dwellers in the city were African Americans, suffering increased isolation and unemployment, whereas blacks made up just 5% of the population in the suburbs. Moreover, the poverty rate for the city was at 32%, the one for the ring was just 6%.³ These figures underline the racial polarization and inequality, and show up the contradiction between the metropolitan area and the City of Detroit. As Detroit celebrated its 300^th birthday in 2001, it might be reasonable to have a look at Detroit's past, present and future.

In this essay, I try to reveal the multi-causality of the decline of the 'Motor-City' USA, covering different aspects ranging from historical, economical, racial and structural. Finally, a conclusion is formed, reviewing the past and contemporary Detroit, but also giving an outlook on the future for the urban area.

Detroit's skyline on a sunny day. Courtesy of Anthony Hiller

2. An ailing patient — the decline of Detroit, “Motor City” of the USA

2.1. The economic transformation of Detroit

2.1.1. A brief view of Detroit’s history from 1701-1948

2.1.1.1. A French enclave as the beginning

Mothe Cadillac, the founding father of Detroit.

Illustration 1.

2.1.1.2. 19^th century and Detroit’s role as a city of manufacture

In the first 100 years of its existence, Detroit was quite a normal city; however it had several advantages because of its good connection to waterfronts of the lakes like St. Clair and the Detroit River. So, the town had an easy access to the Northeast of the USA, lying between the iron-resources in North-Michigan and the coal resources of the Mid-Atlantic states. Therefore, steel production, blast furnaces and brass foundries emerged. The city's factories produced stoves, gasoline engines, marine equipment and carriages³, all forerunners of the car industry, especially the latter. Early automobiles were modeled out of railroad cars, where the carriage making provided bodies, wheels and the assembly principle. The city became the capital of manufacture in that area, and was attracting all kinds of workers, including blacks from the South. They were freed from slavery and searched unskilled but relatively high-paid work. Likewise, Detroit's overall population passed 53400 in 1864.⁴

This all made up several factors of production: (1) the easy access to raw materials like wood, iron and coal, (2) the wealth of businessmen, who were willing to invest their money in new manufactures, (3) a good connection to the other parts of the States because of the rail- and lake-transportation system, (4) a history of a capital of metal bending with (5) numerous skilled machinists, (6) little unionization in the early 19^th century⁵ and (7) the serendipity of Michigan residents to recognize valuable discoveries and trying to market them.

2.1.1.3. Beginning of the new era of automobile production

The last point of the previous chapter may have been very important for Detroit: an ambitious son of a farmer, Henry Ford, built his first car in Detroit in 1896. Nothing spectacular, since the automobile had already been around for a while. But it was the method of how to build a car that would soon revolutionize the whole industry: the moving assembly line. Every worker had just to put small parts together in an easy working progress; therefore production increased dramatically; the division of labor emerged (see Appendix Illustration 29). The coachwork, the backbone of a car, could now be built in 90 minutes rather than in 14 hours before the invention of the conveyor belt. As no more expensive workers were needed because production was split into several steps, cheap and recently immigrated workers could be deployed. This reduced the cost of Ford's famous Model T from $850 in 1908 to $290 in 1920.⁶ Consequently, the sales figures exploded and lots of car companies emerged, like Oldsmobile, founded by Ransom Olds in 1899.

The 1096 acres-large River Rouge Complex, pictured on a postcard of the 1920s. (© Gavrilovich, P., McGraw, B., The Detroit Almanac, Detroit, 2001)

Illustration 2.

By 1920, Michigan was the center of the auto industry, with several steel mills, foundries and engine plants. New supplier firms for rubber products, auto bodies, engines, fans and so on went to Michigan to satisfy the rising demand. First mass-production facilities were established, like the Highland Park plant and the River Rouge (see Illustration 2) factory of Ford.⁷ Meanwhile, the city's population increased dramatically and the need for living space could hardly be satisfied.

Because of the despotic working conditions especially in the plants of the Ford Motor Company, unions were fighting for their acclaim since the 1930s. As the “Great Depression” arrived, President Roosevelt recognized this development in his first year of presidency in 1933; he then created the charta of the “New Deal”. It assured the workers the most important care, but also developed a plan to counter the effect of the recent industrial decline. In addition, the Congress also passed the “National Recovery Act” in 1933, which gave workers “the right for the vote for representatives”. But the patriarchal way of management at Ford kept the unions down until 1941.⁸

Detroit was the nation's fastest-growing large city, but the employment structure distinguished it from other American metropolises, because it depended primarily on vehicle production and other manufacturing industries, thus never became a dominant center of trade, financial services, entertainment or government.

2.1.1.4. The ‘Arsenal of Democracy’ during WWII

However, this was not important yet because another tremendous push for Detroit began with World War II: the city produced a lot of military equipment that could be picked up by the allies by paying for it. This helped to overcome the “Great Depression” and pushed the gross domestic product⁹ of the USA to pre-depression years and even surpassed it. The vacant capacities in the automobile industry were used for the building of war machinery, resulting in 100% workload. Detroit – now also called the “Arsenal of Democracy” after a catchphrase of Roosevelt – got in a very short period of time one of the most dense and most productive industrial “boom towns” in the world. In 1944, a terrible year in general, the U.S. succeeded in near full employment and all kind of ethnicities and races worked together in Detroit's industry. Even Stalin was impressed by the output of Detroit. In 1947 he should have been saying at the Teheranian Conference that Germany had been “defeated by Detroit”, as it produced, among others, engines for the tanks of the red army.¹⁰

2.1.2. Economical rise of post-war Detroit

The post-war history of the U.S. automobile industry and consequently the post-war history of Detroit can be divided into two periods in general: before and after the 1970s. We will now have a look at the prosperity that has followed World War II until its highest peak in 1978.

2.1.2.1. Boom of the automobile industry

Traffic jams were regular in Detroit, when the car was the only accepted way to commute (© Thomas, J., Redevelopment and race – Planning a Finer City in Postwar Detroit, Baltimore 1997)

Illustration 3

2.1.2.2. Severe problems faded out and deferred

Despite the impressive upraise of the economy in Detroit and in the USA, problems evolved but were not fully recognized or eliminated. One problem was that new car models were just redesigned each year, not technically revised.¹⁸ This kept the cost for the production very low, but the risk of getting outdated very high. Another crucial component was the very low gasoline price with no taxation: this led to development of cars that consumed a lot of gasoline. Of course, this did not matter when times were prosperous, like the 1960s. As a result, the Big Three leaned back and did not care about the needs of customers or about the competitors coming from Europe or Asia. During the two oil crises in 1973/74¹⁹ and 1979/80 a lot of panic and anxieties arose in the U.S. because it revealed the dependence of the nation on oil; in 1971, the U.S. auto industry achieved the highest sales in its history, but right after 1973, the small car market share rose from 40% in 1973 to 52% in 1975²⁰, a segment the Big Three did not enter properly. As the oil price relaxed again, the American car industry did not react by changing their product line, but remained producing big and gasoline-wasting cars.

2.1.3. The 1980’s: problems intensified

In the next passage we will have a look at the situation during the 1980s, where problems intensified, as the auto industry's decline was a symptom of the decline of the manufacturing sector in the U.S. and most other western economies. This sector has been replaced by the service sector or high-technology industry. In the 1980s, 250000 manufacturing workers of the car giants lost their jobs, respectively 450000 lost their jobs in the supplier industries.

2.1.3.1. The United States in a globalized world

Since our nations are connected by a global market for products, the countries are offered tremendous advantages but also disadvantages. So called boom-and-bust cycles describe the constant up and down in the economy, and exist in any open market.²¹ They overlap with each other since the nations build an interwoven network. The United States is no longer an isolated economy as it was back in the 1950s. The effects of this system cannot be removed, maximally reduced by for example restrictive import measures. But this often just worsens the problems as other nations will put up similar restrictions, too, which leads again to a loss of jobs in the export sectors. In former times, Detroit's answer to the boom-and-bust cycles was to shut down its plants and lay off workers for months. However, as unions made labor contracts at GM, Ford and Chrysler, companies were required to pay their workers nearly their full wage, no matter if they were working or not.²²

Also, the U.S. industrial labor force lost its monopoly in the world market to the fast-growing, skilled and cheap labor of the developing countries. Several U.S. auto firms therefore had to move jobs from the domestic country to nations with lower wages or to automate production at home to remain competitive.

Furthermore, since the oil price shock, more American customers wanted reasonable cars with low gasoline consumption that the Big Three could not offer; due to this, the U.S. market was a primary target for automobile producers all over the world.²³

2.1.3.2. The effects of a saturated U.S. market

Production of Motor Vehicles in the United States from 1900 to 1997; it peaked in 1978. (© Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, Russell Sage Foundation, 2002)

Illustration 4

Sales were not rising in the 1980s, while interest rates were up to 16% for new car financing. As the situation did not change, U.S. firms had to close plants, lay off workers, reduce wages and so on in order to minimize costs.²⁴ Additionally, the profit margins²⁵ also decreased: in 1973, before the first oil crises, profit margins were around 11,4% but in 1983, as more imports had arrived, profit margins were just around 7,3%²⁶; this led to a diminished ability and enthusiasm of the car-sellers to trade new cars.

2.1.3.3. The clever competitors: Imports from Asia and Europe and their success

As already mentioned, car-import companies from Europe and Asia were concentrating on the U.S. Market, in order to install an outlet for their cars. This was especially true for the cars from Japan, who were the first to arrive in the U.S. - they had several advantages to the American cars. Firstly, they did not need so much gasoline, resulting in better fuel-efficiency and better ecology. This was an important issue, as more and more Americans preferred those cars due to the oil crises, corresponding with the limitation of exhaust fumes in California. As gasoline was expensive in Western Europe and Japan because of the higher taxation, and as it was cheap in America, domestic cars were non-competitive with the ones from abroad. Secondly, they had better quality, resulting in a good reputation. Thirdly, they were cheaper but had more worth of price, therefore were more stable in the resale value. This success of foreign companies was due to a more efficient management, demanding quality checks and taking the needs of the customers more seriously.

The price difference of a comparable Japanese and American car was about $1500 in the 1980s, where just 25% could be justified by different labor costs, the remaining 75% were factors like inadequate quality control, low labor productivity and inefficient management of parts, supplies and inventory in the USA; the “just-in-time” inventory management deployed by the Japanese car industry reduced costs and was much more flexible than the U.S. part suppliers that were spread all over the country.²⁷ Furthermore, the workers in Asia have a completely different relationship to their employer, as everyone, from hourly worker to executives, participates actively and with enthusiasm in the production process. As a result, it is allowed (and even welcome) to make suggestions that might increase productivity.²⁸

In addition to that, the Japanese motor vehicle production was growing 10% per year. To maintain such a growth they had to capture increasing shares of international markets, because their own domestic market was soon saturated, too. The easiest and most profitable target was the United States, where the American car companies could not satisfy the need for reasonable and small cars.²⁹

This challenged Detroit's automobile industry like never before. Unfortunately they just reacted by reducing wage costs through labor-saving processes and machinery, but also by outsourcing parts of the production to smaller and often not unionized firms. In 1981, the Reagan administration - more or less forced by the Big Three - put up a restriction on the total number of imported Japanese cars. However, the clever corporations from abroad reacted by building factories in the Mid-West of USA, not in the area of Detroit because of its lesser degree of unionization.³⁰ Therefore, the Japanese were not importing cars anymore, but building them right in the States, at cheaper costs than the American companies. Hence, they could easily achieve more of the market share in the USA.

And while the U.S. automakers faced a crises situation, even Asian and European luxury brands like Lexus, Mercedes-Benz and BMW were making impressive gains in their share of the U.S. market, during a time when the total market was shrinking³¹. BMW, as a prime example, sold in 1974 just about 184000 cars world-wide, and thanks to the 3-series that is beloved by the American consumers, the company hit 320000 sales in 1980.³²

Nowadays, import companies from Japan like Toyota, Honda, Mazda, Mitsubishi and Nissan all sell more vehicles in the U.S. than they do in Japan. So success in the United States has become the priority for them. The combination of humility, determination, careful attention to detail and, above all, devotion to quality is their formula of success. ³³

2.1.3.4. The lethargy of the clumsy American car industry

It might be more than justified to blame the American car industry for acting clumsy; they seldom sought to compete with imports by looking for improvements in their own company. Instead, they blamed the rivals as being unfair because the foreign governments helped the imports by keeping the currency rates abnormally low and enforced a restriction on the number of imported cars (see 1.3.3). GM vice-chairman Bob Lutz even accused the buyers of foreign cars of having bad taste as he called the Toyota Camry one of the ugliest cars driving around;³⁴ not a good way to regain market shares. The Big Three too often believed that if the gasoline price would relax, customers would come back to the American car manufacturers. In sum, the big national car enterprises were too lazy, too inflexible, underestimated the chance of imports and the management was not sure what to do next. In the case of Chrysler, a company was also too weak to react; it was almost bankrupt twice in one decade: the first time in 1979, as they suffered from billion-dollar losses and the second oil crises, the second time in 1989. Fortunately, the well-known and wise Lee Iacocca was president and chairman of Chrysler during that time, resurrecting the company. But also GM lost $762,5 million in 1980 (its second loss in 72 years), just right after it hit a sales record in 1979.³⁵

Obviously, the car makers had extreme difficulty to undertake a transformation to smaller and more fuel-efficient cars; given the “laissez-faire” tendency of the U.S. government regarding economic and social policies, it was of course unlikely that the administration would have imposed strict requirements for example for exhaust fumes. Environmental issues, for example, would have been reasonable, as the big companies would have been obliged to solve their technological deficit.³⁶ Instead, the Big Three did not react, when the total market was declining, above all because of the decreased numbers of big cars and trucks. But at the same time, the small car market was continuing to extend. This development already appeared during the mid-1960s, long before the oil crises. Unfortunately, the small vehicles built in Detroit were poorly engineered and assembled; this gave the import companies an even greater chance to settle down in the American car market. Due to this evolution, the U.S. car companies turned once again to the big cars and trucks, also because they had greater profit margins, clearly abandoning the small car market.³⁷ American executives had the opinion that compact cars might just be desired by ecology-minded individuals or families, but when consumers would want more space or comfort, they automatically turn back to American automobiles. As foreign companies, especially the ones from Asia, established a foothold in the USA, they themselves upgraded the product line with bigger cars, in order to gain an even greater market share.

2.1.4. The downfall and prospects of the Automobile Industry in Detroit

The previous and the following chapters are closely connected, as the downfall of Detroit's car companies continues until today. At the end of this section I will outline the outlook of the car industry in Detroit.

2.1.4.1. The Big Three losing grip

Total vehicles produced in the United States and the percentage of production in the State of Michigan (© Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, Russell Sage Foundation, 2002)

Illustration 5.

Automation reduces the labor force. (Photo Researchers, Inc./Tom McHugh

Illustration 6.

Another evidence for Detroit's Big Three self-inflicted harm was the vision of GM, Ford and Chrysler in the early 1990s that consumers will focus on new kinds of cars like pickups, minivans and, in the mid-1990s, on SUVs (Sports Utility Vehicles). This was partly true³⁹, but at the same time the companies ignored almost the whole ordinary car market. As Detroit lost its grip on the small-car market in the 1980s to Asian car manufacturers, it did so too in the 1990s with the mid-sized car market. For example, Toyota's Camry and Accord as well as Volkswagen's Passat, conquered a great market share⁴⁰. This again was the case in the highly profitable market of luxury cars: Cadillac and Lincoln have led this segment until 1986⁴¹, but during the past 16 years, Lexus, Audi, BMW and Mercedes-Benz, just to name a few, overtook the American corporations in sales (see Appendix Illustration 31)

In order to create short-term profits, the Big Three did not invest sufficient capital in updating their product line. Corporations such as Chrysler, GM and Ford simply had grown too big to respond to the need for innovation. Cars of the competitors were directed by much more technology, while the car makers from Detroit just updated their products superficially. On the other hand, the domestic brands have to meet harsh requirements to survive anyway on the market: offer a product line with lots of different car types and different price ranges, to respond to every single customer. In order to maintain the system of mass production, they were under pressure to sell a high number of cars. This demanded a lot of strength, smaller companies were forced to quit business or merge with bigger companies. Even the Big Three were sometimes not strong enough, as we saw an almost bankrupt Chrysler (see 2.1.3.4.).

As a result, competitors - that now even build their cars in America, but not in the closer area of Detroit - caught up. In 2003, four out of 10 vehicles sold in the USA have been built by foreign companies⁴². BMW, Honda, Toyota or Mercedes-Benz and others devoted their human, financial, engineering and marketing abilities to the U.S. market and were rewarded. American car makers did not focus on these branches, but were interested in short-term profits. The primary aim of the Big Three was rarely to be good, but to be big and to grow strategically. Ford bought Jaguar in 1990 and Volvo in 1999 (for $6.45 billion) with a disappointing outcome. GM bought Saab and engaged in joint ventures with, for example, Fiat and Toyota but did not profit as much as it expected. Finally, when Chrysler merged in 1998 with Daimler-Benz AG, both corporations became DaimlerChrysler; but in the next years made it quite clear that it was rather a takeover of Chrysler than a merger.⁴³ The Germans were hoping that they gained a cash machine that provides an easy and solid access to the American market. The resulting company, however, suffered from contradictions in the product line and from production delays. But without this unintended takeover, Chrysler might have been again bankrupt, as it was in deep financial trouble.

A further point is alarming: there is a strong tendency of people living in wealthier states of the United States like California to buy foreign cars. And as a role model, other people from other parts of the country might desire the cars of wealthier persons, too.⁴⁴

Another important issue is the problem of low resale values of automobiles made in Detroit; foreign cars have in general a better reputation and therefore are worth more money when they are traded. Aside from that, the Big Three inflicted damage on themselves, as they sold inexpensive mainstream car models like the Ford Taurus in great quantity and at a fair price to car-rental companies, which employed these cars in masses in their fleet. Normally this would have been desirable, but as the rental firms sold the slightly used cars back to private customers, the value of the same used car model dramatically shrunk in equal measure. This leads to the fact that many people want to buy cheap second-hand cars that are hardly used, instead of new cars that cost more money but offer little more. This leads again to a feeling of disappointment or even betrayal by many new car owners, as they have bought an auto at full price but can get just a fraction of it when they trade it. Those people will think twice about buying again an American made car in the future.⁴⁵

2.1.4.2. Outlook for the future of Detroit’s car industry

In the end of the review about Detroit's economic transformation, we will have a look at the future of the car industry in Detroit and in America.

Already today, one cannot talk of the Big Three of Detroit anymore, because of the “merger” of Chrysler with Daimler resulting in the DaimlerChrysler Corporation, now employing 466938 workers in over 200 countries. Chrysler will never again support any limitations against foreign-based companies like Mercedes-Benz, as they now are actually owned by one.

So the “Big Two” remain. Ford is indeed a big corporation with nowadays employing 340000 people in 30 countries, but is on the edge of a crises. In former times, workers had received insurance pensions from the company. As more and more workers are about to retire, Ford has the obligation to fulfill contracts and pay the retirees: the pension fund has a deficit of $25.6 billion; health care liabilities are about $27.4 billion, also likely to bring enormous trouble to Ford.⁴⁶ Also remarkable is that the Ford family existing today owns about 30% of all shares of the company. This sometimes results in absurd decisions, as they are the major shareholder of the company, giving them a lot of power.⁴⁷

The second car giant left, GM, employs 388000 people worldwide, has plants in 50 nations and corporate presences in more than 200 countries.⁴⁸ The company also has to cope with great financial losses, as they have also about $50 billion health care liabilities and the pensions are under funded to about $25.6 billion.

These numbers reflect unhealthy corporations, but imports show an enormous financial strength. Toyota for example, earned an operating profit of nearly $12 billion in 2002, more than the combined profits of the Detroit car companies during the past five years.⁴⁹ Fighting against such a stunning superiority is already now next to impossible, as Toyota is by no means not the only competitor.

In general, there are three major scenarios as to how the situation might develop for the car companies from Detroit. In the first case, they will simply lose market shares until 2010, with a rate they are used to the past few years, to around 50%.⁵⁰ The second scenario could be that at least one of the Big Three companies is likely to disappear, as “neither the size of GM, nor the Ford family at Ford nor the protection of DaimlerChrylser at Chrysler” ⁵¹ can protect from continued decline. The last of the three most probable scenarios might be a further merger of an American car company with a foreign one, as was the case with Chrysler, or even a coalition of GM and Ford.

Surprisingly, the Big Three have found a new ally in form of the unions. The latter are also interested in secure jobs and a flourishing American car industry. It is worth mentioning however that the actions of the United Auto Workers (UAW) have altered in large scale. In prosperous times, they were fighting for years against the big companies for fully paid health care, childcare, pensions, vacation time and education benefits and so on. They are forced nowadays to give wage concessions in order to retain at least a fraction of the jobs in Detroit and not to automate or outsource parts of production to low-wage countries. A proper way to solve problems would be a meeting between the UAW and the Big Three to work out a plan to the future. However, the companies still are far too self-centered to take any steps of that kind.⁵²

Of course, as the auto giants experience a strong crises, they want to enhance the reliability, quality and design of the cars. In the first case, callbacks of many newly introduced cars, as the very recently updated Ford Thunderbird, destroyed immediately the hope for a better image. As in the latter case, the Ford Taurus for example, a usually very high-volume selling car was designed too roundish for the taste of American customers. Normally an avoidable fault, if the company had performed more research, about what car purchasers want. This is generally a problem of the Big Three that the imports always had taken advantage of, as they did not make the mistake of leaving customers' needs unheard.

Shortly after the terrorist attacks in September 2001, many Americans joined the patriotic feeling by buying cars of the Big Three. The car companies also offered zero percent financing on cars, actively approaching the customers. This resulted in a considerable deficit for the companies but they gained back some percentage of the market share. However, as customers detected a lesser degree of reliability, durability, styling and value in general, compared to imports, they were of course disappointed. Unfortunately, the big American car companies were not showing any understanding and ignored the sign of the inconsolable customers⁵³, falling back to their old role as being arrogant and starry-eyed.

Another disadvantage for the American car industry was the utilization of the Internet. Interested purchasers of automobiles do extensive research on the World Wide Web, receiving loads of information about used car resale value, leasing and invoice prices. The user is able to compare different kinds of cars from different companies in no time. Although the purchase of cars directly over the Internet is very rare, lacking the personal contact with the dealer, already 60% of all car buyers benefit from the wealth of data they find on the Internet. Denny Clements, general manager of Lexus, sums up the increased transparency for the purchasers up by saying: “the better informed a customer is, the worse it is for Detroit”.⁵⁴

In the long term, the outlook for the car companies from Detroit is quite bleak, as no true solution is in sight. As the City of Detroit is closely connected to the future of its car industry, the metropolis might get into severe financial and social trouble, as less and less workers have a job, slipping into long-term unemployment, unable to pay any taxes. Finally, Detroit could not close the gap from manufacturing industry to service providing industry. Furthermore, the remaining car companies like Chrysler, GM and Ford follow subsequently market trends like globalisation, technological changes like automation and the decreased demand for less-skilled work.⁵⁵

For the American car industry in general, the outlook is not so cloudy at all: several car import corporations now produce their cars in other American regions. Above all, Birmingham, located in Alabama, rivals as a production location for car factories, giving the region already the nickname “South Detroit”. Also Ohio, Indiana, Illinois, Kentucky, Tennessee and South Carolina already today contain plants of car companies from abroad, all offering attractive conditions like little to no unionization and financial incentives as the abatement of tax. Detroit as a city cannot offer such stimulation, even if they want to, as they were pushed into a financial crises since the Big Three are having losses as well and dismiss more and more tax paying workers into unemployment.

To close this first of three major chapters with the words of Micheline Maynard's book “The end of Detroit”:

“The emergence of [a] parallel American automobile industry is an astounding prospect, considering how deep Detroit's roots are sunk into the American culture. But the Detroit companies have had plenty of time to get used to the idea – since the 1980s, in fact”. ⁵⁶

2.2. Social changes in Detroit

The next major chapter in this essay will be devoted to the social change in Detroit. This is a very complex topic and will determine the future of the city and of the people living in the city equally as the economic development did. The historian Thomas Sugrue claims in his book “The Origins of the Urban Crises” that all problems of urban Detroit obviously emerged before 1970. At least in social and racial hindsight, this is totally right, because blacks were treated differently since they arrived from the South. The race relations may have changed, but still today, the two most important issues to solve are the discrimination of blacks and the disparity between the predominately rich whites living in the suburbs and the prevalent poor African Americans in the City of Detroit.

2.2.1. Overview of racial problems: development and perspective

I will begin with the former point and examine the past racial relationship between blacks and whites, but also point out the present situation.

2.2.1.1. Early blacks arriving from the South

Origin of black population in Detroit between 1920 and 1990 (© Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, Russell Sage Foundation, 2002)

Illustration 7.

2.2.1.2. 1930s to 1970s: increasing tensions between races

Since discrimination and segregation was actually not forbidden, the situation aggravated, even for blacks working in well-paid blue-collar jobs. The whites predominately believed that their own race is superior and the blacks were just inferior. They refused consequentially mixed neighborhoods, where both races live together. This barrier led to the fact that African Americans had to live in the most deteriorated sections of the town. When blacks were finally arriving after their journey from the South to those segregated neighborhoods, if they were able to, they caused white exodus or at least neighborhood instability. On the other side, enclaves with people of European ethnics dispersed and assimilated, buying newer and better housing, apart from a few exceptions.

Extreme organizations consisting of white members like the Ku Klux Klan gained popularity throughout the States as they took advantage of the hatreds against African Americans. Even worse is the fact that the car manufacturers used the same animosities and prejudices for vulgar actions. An example is the method how unions were played off in the 1920s: Ford for example reserved a special percentage of the most badly paid jobs for the poorest blacks in the factories. The unemployed blacks were abused as a kind of strikebreakers, because they always were willing to work under any circumstances.⁵⁸

Unions played a crucial role, as they created to a great extent America's middle class. In the 1930s, the United Auto Workers (UAW) emphasized the principle of equal pay and opportunity for both blacks and whites, as they were afraid of permanent abuse of poor blacks as strike breakers, endangering the jobs of whites who stopped working in order to protest for more influence in the factories. No wonder that unions were very influential until the 1970s, because they were able in some way to unite highly paid unskilled and skilled workers of all races.⁵⁹ However, problems were far from being solved, as we will see later in chapters 2.2.2. and 2.3.1.

When World War II started, black and white workers were still used to separate labor markets; African Americans were restricted to foundry work and general labor. This was nothing new, as it was evident already in the mid-nineteenth century that those few blacks who moved to Detroit from the South were treated differently from European immigrants. In the decade after World War I whites felt save as long as blacks were employed in the dirty, “nigger jobs”. But as soon as blacks got the opportunity, to get into “white jobs” during the World War II⁶⁰, the tensions increased dramatically, resulting in a race riot in 1943. During this incident, 34 people – all black – died as a white crowd consisting of 100000 people raged in black quarters. This act of public lynching happened because whites could not get along with the imagination that they might live or work together with middle-class blacks in the same quarter or same factory. African Americans could now reach some prosperity as they were employed in a growing car industry that staff more and more jobs of higher positions that once were controlled merely by whites. In the same period, whites protested in spontaneous strikes against “niggers” that are now employed next to whites.⁶¹ Either way, they had to cope with the new situation, as the car companies themselves had no other choice but to employ blacks in certain workplaces in order to fill the jobs.

In the time between 1940 and 1970, about 600000 African Americans moved to Detroit (see Appendix Illustration 7 or 39). Most of them were drawn to the overcrowded and ramshackle Lower East Side quarter and living under very poor conditions. This district of Detroit was a kind of gateway for all black newcomers to the city, hoping for better living standards when they would get a job. Unfortunately, an upward social mobility was denied for most of the blacks, as whites opposed desegregated living⁶².

This was the initial situation, as another riot started in 1967 (see Appendix Illustration 32). It was in fact a social-economic rebellion of blacks without hope, triggered by a raid of a “blind-pig”⁶³. A crowd of 192 police officers wanted to arrest 82 people, but instantly rioters were overwhelming the cops. Reinforcement troops were few because a lot of officers were on vacation. The governor activated the National Guard to help Detroit's police and the state police, but the Guards was poorly trained and often overreacted, leading to needless deaths and injuries, as 43 people⁶⁴ died during the incident. Finally, President L.B. Johnson ordered the U.S. Army paratroopers from the 82^nd and 101^st Airborne division to Detroit that had a specialized training in urban disturbances; after all, they brought order back to Detroit. 4400 policemen from Detroit, 8000 national guardsmen, 4700 federal troops and 360 state police officers were patrolling in Detroit a day after the riot. A deep polarization between the races grew out of this tragedy, as whites had a persistent view of the “bad blacks”, and African Americans had justified hatreds against the sometimes ruthless police of Detroit that was consisting just out of whites.

Detroit got to be one of the cities with the worst problems in the entire USA. There was no compulsory connection between the automotive boom and a peaceful coexistence of the races. Whites consequently fled out of the core of the city (see 2.3.1.2.), decreasing the total population in times where the population of blacks increased. The political and social self-consciousness of blacks raised, but they also recognized their isolated position and the increasing wealth of the white middle-class. Riots had been foreseen by many in Detroit, however until the late 1960s, African Americans were underrepresented in the city government or in the police, as they held not any top position. This resulted in a stubborn attitude of the administration.

Another decisive point in the history of racial conflict in Detroit was the school desegregation policy introduced in 1970. Schools, like houses, represent a racial territory and status. They are often the central institutions in the communities. One reason why whites opposed blacks moving into their quarter was that they knew residential integration would finally lead to school integration. As a committee acknowledged the presence of severe racism in the Detroit school system, it recommended bussing⁶⁵ as a solution in order to end segregation. This revealed racist feelings of many suburban whites towards blacks in the City of Detroit, similar to the hysteria after the riot in 1967 that had driven many whites out of Detroit. In the suburban community of Pontiac ten empty school busses were bombed in order to prevent the transportation to racially integrated classrooms. Today, while some white suburbanites accept the bussing of black students to suburban schools, they strongly oppose the imagination that their children are bussed into the predominately black City of Detroit. Many whites try to avoid all contact with blacks, particularly the whites who have moved to the fringes of the city to get away from the blacks in Detroit. This view has changed until today.

A few years later, in 1974, a strong mayor and a champion of the fast growing black community took over city government: Coleman Young, the nation's first black mayor of a large city. He was very charismatic and committed to his job, promising to defy racial wrongs and to redevelop the city effectively (see 2.3.3.3). But even for him, the coincident consequences of industrial and commercial decline, population loss, increasing poverty and racial conflict proved hardly solvable. He also just got elected as whites were fleeing out of the city, leaving the votes to the blacks. His trials to develop a better city brought some little success, but failed to heal the deep wounds that racial hatred had caused. He sometimes polarized the citizens further, when, for example, he said every black should legally own a gun for self-defence or stating the “palefaces” should get out of the city. Coleman was mayor until 1993, when Dennis Archer took office.

2.2.1.3. The contemporary situation compared to other big U.S. cities

Today, metropolitan Detroit can be distinguished from other Northern and Midwestern metropolises by its relatively large African American population: 22% in 1990, about twice the national average. However, the City of Detroit consists of about 90% blacks nowadays, an unbelievable figure compared to the U.S. average.

Increasing percentage of blacks in the residential area Detriot: a century-long trend (© Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, Russell Sage Foundation, 2002)

Illustration 8.

Stereotypes emerged in both ethnic groups; the corresponding neighborhood segregation does not distinguish Detroit from other big U.S. cities like Atlanta, Chicago, Boston or New York.

In his book “Detroit divided” Reynolds Farley put it in these words⁶⁷:

“In all the nation's older metropolitan areas with substantial African American populations, black and white seldom live in the same neighborhoods. But the thoroughness with which long-term social, economic and racial trends produced an African American central city in Detroit surrounded by an overwhelmingly white suburban ring makes Detroit unique.”

Number of homicides in the City of Detroit per 100000 residents (© Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, Russell Sage Foundation, 2002)

Illustration 9

Affirmative Action is opposed by many whites, and of course, endorsed by many blacks.

Illustration 10.

As long as it is a matter of course that racial and class isolationism are accepted, social and income segregation will exist, as the next chapter will prove.

2.2.2. Growing distance between rich and poor

As we have already seen in the previous overview of the racial problems, there is always the returning issue of racial problems combined with a difference of wealth the group can gain.

2.2.2.1. How the classes overlap with races

Obviously, the races overlap with their status in the society, their class; blacks are predominately poor and living in poor dwellings located in the City of Detroit, whereas whites are predominately living in the suburban ring and enjoying wealth and good housing. Illustration 36 shows exactly that distribution in the period between 1950 and 1990. Another fact is striking when analyzing the charts: the income situation changed hardly for the blacks/City of Detroit, whereas the whites/suburban quarters experienced an upswing in monetary affairs. In the case of the City of Detroit, the lowest class even augmented, reducing the taxes and therefore the financial power of the city, to counter such a development, as we will see later. Of course, blacks who are well off were trying also to flee to the outlying sections of the city, just like their white counterparts. However, this only contributed even more to the residential segregation of the black poor. More surprisingly is the fact that white and black homeowners joined their forces to oppose publicly funded housing for the poor, as they were afraid of sinking property values.⁶⁸

2.2.2.2. Social gap due to racial discrimination and segregation

A survey conducted by the daily “Detroit Free Press” in 1970 revealed the following Top Five complaints among black residents in the city: 1) Police brutality, 2) Poor housing, 3) Poverty, 4) Lack of jobs, 5) Overcrowded living conditions. All points listed refer basically to racial discrimination and the accordant segregation. Disparities between the races existed (and still remain today) at several levels, namely at workplaces, education, income, housing and so on.

The first topic, inequality at work exists until today, although it was officially abolished shortly after World War II (see 2.2.1.2, footnote 57). In the late 1990s, about 64% of the black male working force in Detroit between the ages of 25 and 64 had jobs. Among white men, 87% were employed. That trend has lingered for decades, even in the booming economy of the 1950s, as 84% of black men respectively 92% of white men were employed. Since 1970, when many blue-collar jobs began to disappear, no more than 65% of black men had an occupation at any point in history.⁶⁹ Blacks in Detroit therefore have generally have had an unemployment rate to 3 times of whites at all time, sometimes backing up the prejudice of lazy African Americans from whites. Naturally, a high potential for conflict is emerging, as there are serious differences of income between the ethnic groups. Since the job situation in the City of Detroit worsened, no solution is in sight.

The second point, differences in the education (!pic19,100) of inner-city black students and white youths living on the rim of the city, did not change just because of the cross-district school-bussing. Inner city schools and universities in the city are severely under funded, resulting in poorly maintained buildings and little equipment at class to enrich the lessons. Consequently, African Americans have less job opportunities and/or are paid worse than their white counterparts. This again ends in income disparity; there also seems a strong tendency of white employers to hire persons of their own skin color. Reynolds Farley initiated a survey written in his book “Detroit Divided”; he arrived at the conclusion that:

“...African Americans believe that they frequently miss out on good jobs, promotions and attractive homes and neighborhoods because of systematic and pervasive racial discrimination. Regardless of their educational attainment, income or occupational achievements, Detroit's African Americans see extensive racial discrimination in all areas of public life. From their viewpoint, it is a color-coded metropolis with whites in control. (...) Racial views have changed, but when whites are getting asked about the modern racial stereotypes – that is, about racial differences in the tendency to be intelligent or the tendency to prefer to live off welfare rather than to work for a living – they still often followed negative stereotypes.”⁷⁰

This wall has had to be built in the 1940s, in order to separate a black neighborhood from a white one, to comply to the separation regulation of the FHA and to get loans for white housing. (Courtesy of Lowell Boileau)

Illustration 11.

As a result of all the matters stated before, blacks could not leave the central city at the same rate as whites because of unnatural burdens. Due to this, instability and contemporary racial segregation still survived until today. To envision the long-term legacy of racial segregation: in the late 1950s, 178000 new homes were constructed at the outer limits of the city, but only 750 were available to non-whites;⁷³ as former generations of African Americans could not move out of the city in the same extent as the whites, they were caught in a ghetto. The following generations sometimes never had the chance to exit the inner districts of the city, because they suffered from unemployment or lack of financial means. If the black population size had been stable or shrinking, discrimination in the larger housing market would perhaps have been bearable. But since the number of African Americans living in the city continued to grow, the situation worsened. A vicious circle emerged.

Pic19,160->appendix 19,190real estate

2.2.2.3. A divided Detroit

To recapitulate the basic situation in Detroit: the city consists of two major parts: firstly the affluent suburbs where a majority of well-off whites live and secondly, the black people living in the City of Detroit, suffering both from pauperism and isolation. Thus, race inequality is as widespread in metropolitan Detroit as class inequality.

As industrial growth extended to the suburbs and as commercial capital concentrated on the periphery of urban areas, the line of uneven development shifted from cities within the city to a line that divided the city from its suburbs. In the case of Detroit, this is a racial blockade.

Distribution of In-Migrants to Metropolitan Detroit and Nonmovers, showning clear differences in eduction. (© Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, Russell Sage Foundation, 2002)

Illustration 12.

As no shift of population is in sight, by 2020, about 95% living in the City of Detroit will be African American.

Synonymous for a 'divided Detroit': 8 Mile road, separating the City of Detroit from the Northern suburbs located in Macomb and Oakland County. The name '8 mile' even got poplar in Europe, as an identically named movie starring Detroit's Rapstar Eminem was shown in theatres. (Courtesy of Lowell Boileau)

Illustration 13.

19,68

Volume II

2.3. City planning in Detroit

The last major point in this work will be the contemplation of city planning issues, redevelopment problems and the steps that were taken to counter all levels of problems within the City of Detroit. This resort of administration is in my opinion by far the most important to shape Detroit's future.

Detroit and its suburbs combine to form a metropolis where 3.91 million people live. The Detroit city of 0.919¹ million comprises 23.3% of the population and 85% of the region's blacks. In contrast, the suburbs are where 76.7% or 3 million people live; 88% are whites and 4.2% are blacks (see Appendix/Din-A3 paper)

2.3.1. Detroit’s phenomenon of the escape to suburban areas

The growth in ownership of automobiles was accompanied by a growth in migration of population from urban to rural centers. The trend toward home ownership first led to urban sprawl, then to suburban migration and the need for multiple auto ownership. Even more people were moving to the fringes of the city, as the predominate families became mobile.

Two main reasons for that growth of suburban districts were in the first place a housing boom, financed with federal home mortgage insurance programs and tax policies; in the second place a heavy reliance on automobiles, financed by federal support of highways. Another reason was the attractive amenities of suburban life. But racial change within cities speeded white exodus to the suburbs. Suburban housing and quality of life were the primary “pull” attracting urban whites, but black entry into formerly White residential areas was a major “push” encouraging many to leave.

2.3.1.1. Relocation of the industry and business to the fringes of the city

The implosion of the J.L. Hudson Building in 1998. (Courtesy of Lowell Boileau)

Illustration 14.

In sum, Detroit lost 187000 jobs between 1958 and 1982, mostly in manufacturing and retail trade. But firms were leaving just for practical reasons; Detroit had high taxes, dated production facilities, high crime rates, a public infrastructure in poor condition and strongly unionized labor force. The city could not retain business activity or even attract new ones.⁶

Pic root,47

2.3.1.2. Counterproductive infrastructural enhancement

The Freeway system that emerged in Detroit, destroyed a lot of healthy neighborhoods (© detnews.com)

Illustration 15.

2.3.1.3. Motivation for the exodus of residents

Twice Increasing black percentage in the City of Detroit: a century long trend (© Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, 2002)

Illustration 17.

Now, we turn to the “pull” factors of the suburbs: firstly, the housing issue. As Detroit was growing in the post-war era, homes on the fringes of the city were quite expensive, as for a $24000 brick house, mortgage dealers required a 30% down payment.¹¹ But when President Eisenhower was in office, he wanted an expanding housing industry and therefore made new deals that only required 3.3% down payment of war-veterans for a new house in the suburbs. The Federal Housing Authority (FHA) supported this also by giving away loans under very good conditions. The segregationist practices of the department, not to allow loans in neighborhoods where many blacks live, prevented also many liberal whites from building a home in the city, as we saw 2.2.2.2. Furthermore, home insurance was not available or much too expensive. Additionally, taxes were also lower in the suburbs for families, not just for industry and retail. Many other dwellers living in the core of Detroit were also attracted by a life in the suburbs that pretends to be the true “American Dream”: what is needed, when you can yourself afford to own a car, is a garage with a small but nice house and a green garden. More personal space is also available and one does not have to endure the tensions within the city. Also, a friendly community with self organisation, personal security and mutual care were depicted. Huge malls, where endless hours can be spent on shopping and strolling, opened in the 1950s. Last but not least, the residents in the suburbs wanted to be envied by the life they led. They paid the obligation to conformance as a price for the advantages. While any particular family could have had their own motivation to move over to the suburbs, the cumulative effect managed to depopulate the City of Detroit selectively, as the flight was classified by racial animosities and income or class differences. Characteristic is the following statement¹² in “Detroit – Race and Uneven Development”, mentioning that

“(...) the arrival of Negroes served as an excuse to invest in that stainless steel, formic and plywood-paneled dream house and believe at the same time that they were acting wisely from an economic point of view. The pull of the suburbs and the quest for social status was too much for many whites, even those who believe strongly in integration. And as middle-class white neighborhoods in Detroit opened up to blacks in the 1950s and 1960s, some after a serious of conflicts and others via cooperation or at least practical coexistence, they tended to become extensions of the black ghettos rather than long-term biracial communities”.

No matter how middle-class blacks were welcomed in the new neighborhoods, the increased number of blacks also getting out of the city, left the poor residents over.

2.3.2. Consequences of urban flight

Since the beginning of the 1950s, the white suburbs took over the economic power and declared the white areas that surround the black inner-city to the “Metropolitan Area of Detroit”, in order to distinguish from the “City of Detroit” which is – in their opinion – full of crime and dirt.

2.3.2.1. Loss of capital

With the remnant dwellers in the city working in low-wage jobs, unemployed and poor, the city fell short of money. The tax base¹³ was not big enough to shoulder the care programs, as health care. As the well-off left the city, so did the retail power. The population shift resulted in massive movement of capital to suburban areas as we see in PIC, appendix. It is shown how the central city did own half of the region's property wealth in 1960 and ranked first by far. By 1980, Detroit's share of the region's property value had shrunk to a devastating 16.5%, whereas Macomb and Oakland County were unrivaled. Also alarming: due to the economic tailspin of the central city, the assessed valuation of property in relation to the percentage of population had fallen in real terms between two decades: in 1960, 42.3% of the population had 49.6% of wealth (ratio 1,17), but in 1980, 17.6% of the population possessed just 16,5% (ratio 0,94)¹⁴. At least as severe as this was the decline of industrial investment of about 50% in just two decades: in 1958, 44% of investment projects were targeted to Detroit, in 1977 barely 22%.¹⁵

“Capital was mobile, but Detroit was not”¹⁶ is the statement of June Thomas in her book “Redevelopment and race” that hits the nail on the head. While the automobile industry could escape somehow by decentralizing, modernizing and seeking new markets, the City of Detroit could not. Its manufacturing sectors was in a serious state of decline, yet some industrials firms moved out of the inner city, further reducing the tax base.

But not only the source of capital through taxes was drawn to an end, federal funds also diminished. In 1980, federal money of $392 million made up over 26% of the budget of the city.¹⁷ During the 1980s, the federal government discontinued its general revenue sharing¹⁸ program and limited money for job training, Community Development Block Grant (CDBG)¹⁹, housing subsidies, mass transportation, health and other sectors.

While city populations fell 35% in the 30 years between 1950 and 1980, the total number of employed residents dropped 48%.²⁰ Such unbalanced loss of employed residents combined with a decline in city revenue because of stagnant property values and residential flight added up to serious fiscal problems for the city.

This is the resulting dilemma: the taxes are more than insufficient but they also cannot be raised, as even more business would respond to the call of the suburbs.

2.3.2.2. Ghettos and slums: the isolated urban inner city

Black slums have existed for a long period of time because blacks arrived in Detroit after their journey from the South and ghettos had a gatekeeper role for them; city areas generally grew not on purpose until the 1950s in America.

The graceful architecture of the Michigan Theater (built in the 1920s), now used as a parking lot. (Courtesy of Lowell Boileau)

Illustration 18.

With a life in unemployment, over 250000 of the blacks receive money from federal social aid programs, over 100000 households are just single-parent homes, whereas three quarters are African Americans²⁴.

Also, all-black neighborhoods emerged. When whites did move out of neighborhoods like Bagley or Mack-Concord, poorer blacks were able to join or replace middle-class blacks. These areas changed by racial and income means, often leading to problems of housing maintenance or crime. In other words, expressed again by June Thomas:

“As the numbers of renters increased, the city reduced attempts to enforce the housing code. Lending institutions withheld mortgages or loans for home improvement and real estate agents steered young White families away. All of this led to a self-fulfilling prophecy: Black entry into neighborhoods did lead to deterioration – a classic case of blaming the victim.” ²⁵

Public housing was once more an issue: Detroit stopped spreading public housing projects over the whole city, but concentrated it in the inner-city, laying the cornerstone for ghettos. Suburban communities refused to pay for the problems belonging to Detroit and did not finance any public housing. Prevalent racial prejudices triumphed²⁶.

There are generally two attitudes towards the phenomenon of badly developed areas: On the one hand those who are most concerned about slums, so about deteriorated housing. They also support public housing programs and tend to come from liberal backgrounds. On the other hand there are those concerned about blight, which is usually hinting to economic deterioration. These people were often land- or business-owners themselves and are more worried about falling property values than the future of the poor. No matter to which group belong, it is inevitable that you recognize the uncountable amount of deteriorated, vacant, abandoned, neglected and demolished buildings which sometimes get recaptured by nature.

2.3.3. Attempts to improve the situation in Detroit

Normally, American cities were founded for a commercial purpose, they got developed on drawing boards of real estate dealers²⁷, not on the ones by city planners; this makes it very hard to influence the shape of any city by any specific city planning measures or redevelopment policies. The matter of redesigning the city may be the most sophisticated, complicated and difficult to manage, because every subject – not mattering whether of social, racial, economical, financial, aesthetic-architectural, etc. point of view – has to be taken into account.

2.3.3.1. Early trials from from 1950s to 1970s

The 1952 Master Plan ant its zoning of industrial and commercial sectors. (© Thomas, J., Redevelopment and race – Planning a Finer City in Postwar Detroit, Baltimore 1997)

llustration 20.

Also, to avoid the severe congestion on the roads during the rush-hours, the city decided to build several highways with the mentioned aftermath described in 2.3.1.2. Many black neighborhoods were intentionally destroyed and this restructuring was perceived as an act of “slum clearance” and not as an act of revitalization. This is also the cause for many to be scared and devaluate the actions which were undertaken by the city, as it was often opposed to blacks and enforced by whites. But not only did redevelopment negatively affect racial justice, it was also the other way round, race relations negatively affected redevelopment. In particular, this was the case when racial polarization continued within the Metropolitan Area of Detroit and white developers, real estate agents and homeowners preferred to reshape the white suburbs over the dark inner-city.

After the late 1960s, the city switched away from the slum-clearance characteristic of urban renewal rather to residential rehabilitation and economic development policies, which are designed to keep institutions and industries from leaving the central city. Money was spent and tax concessions were made in order to keep industrial corporations in Detroit, because work places stand for new residents. But it was a zero-sum game because the disadvantages of resettlement and high expenditures compensated the advantages like few decent houses and work places.

But even when residential areas were about to be redeveloped, many dwellers of the settled site had to be removed temporarily, and it is quite unsure that the inhabitants of former houses could ever possibly afford new ones in the restructured area. Sometimes, the sectors did not even include residential units, but were supposed for industrial or commerce only.²⁹

However, there were some more or less successful model projects like the restructured Lafayette (formerly Gratiot) Park (PIC 21) in the East. It was designed, among others, by the famous architect Ludwig Mies van der Rohe. This plan also had major flaws, because it destroyed more housing than it generated and could not stop the elopement of the middle-class. Detroit had to face many problems, like poverty, depopulation and economic decline. Survival became a real issue as housing and jobs deteriorated. A lot of people considered it to be sarcastic when Detroit drains its money into some model projects³⁰ instead of helping the needy.

Worth mentioning, too, is the project of the Civic Center in downtown. Downtown by itself is about one square mile large, and can be crossed in about half an hour by foot. The Civic Center finished construction in the late 1960s. Cobo Hall and the Convention Center(pic11/6/21/17), part of the complex, are still today a very important factor in Detroit's renown, as the famous Detroit Auto Show exhibits in Cobo Hall. Some additions like the Civic Center Riverfront Promenade (21,20) followed in later years, keeping the site up to date. But in some opinions, the buildings are too overloaded and too cubic, likely that you lose your way.

After all, actually little has changed in Detroit in general; although a number of new apartments and office buildings have been built, no greater retail shop opened its doors. Meanwhile, a lot of low-income housing areas further decayed or were abandoned. This process, once more, prevented many commercial or industrial investors from building their branches in Detroit, and so the tax base of the city further declined without any relaxation in the job market.

2.3.3.2. A ray of hope? The Central Business District

The RenCen in the CBD was supposed to have a catalytic function for downtown Detroit. (Courtesy of Lowell Boileau)

Illustration 21.

“The resulting 51-member partnership, called 'Detroit Renaissance', was then the largest private investment group ever assembled for an American urban real estate venture. Financing came from a $200 million construction loans from major insurance companies and investments from the corporate partners, including at least $300 million from Ford Motor Company. The resulting complex became an instant Detroit landmark, finished by 1977. Five high towers made up the original phase, with a hotel offering 1400 rooms occupying the innermost, 73-story cylinder. Four outer towers were 39 stories each and accommodated offices. But the RenCen experienced a number of problems; it was not properly connected to the surroundings, making it difficult for pedestrians to enter. It was quite clear from the beginning that the building offered an over-capacity, although GM and Ford transferred some offices from their headquarters to the Renaissance Center. The RenCen suffered major financial losses, forcing the original investors to sell it [to another investment group]. But the building symbolized the potential of the riverfront and the central business district.“

The Millender Center, with the People Mover passing by. (© Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, 2002)

Illustration 22.

GM is now renovating the building for about $500 million since 2000.³²

Other projects to enrich the downtown area were for example the Millender Center (see Illustration 22), which stands just across the RenCen and was completed in 1985 as a mixed-use project, also with a hotel, some retail shops and restaurants; Trappers Alley (21,40) provided a festival marketplace mall, Trolley Plaza served as an apartment building and a new District Court Building was constructed.

The riverfront, with its inherited beautiful scenery was also part of the urban renewal plan; Riverfront West, twin-towered with 29 storied apartments was built, also by two private investors.

The People Mover. (Courtesy of Lowell Boileau)

Illustration 23.

In general, it is questionable that, when the development within the city is so uneven, so many dollars are being spent just to keep some business connected to the downtown.

In 1994, Dennis Archer became the new mayor after Coleman Young and he proved as a man of diplomacy and capability. He stands for a new, more flexible and strategic way of city planning, as he set the focus more on self-initiatives. However, racial disunity remained an issue. He was more professional than his predecessor but at the same time, he was not a racially polarizing mayor. He approached actively white residents and the business sector.

The Comerica Park, home of the Detroit Tigers (baseball team) and many retail business:

Illustration 24.

Mayor Kilpatrick speaking in front of an audience. (Courtesy of Lowell Boileau)

Illustration 25.

In 2002, Kwame Kilpatrick - 31 years old - became the youngest elected mayor in Detroit's history. He initiated programs like the “Kids, Cops, Clean” project, including small but important steps towards a better future for the city; it consists, for example, of better care for children, a more efficient and helpful police department and the effort to clean the city. This program is mostly based on volunteers, as the financial background of the city is anything but healthy.

Hart Plaza with its imaginative fountain. RenCen is located to the right. (Courtesy of Anthony Hiller)

Illustration 26.

3. Past, present and future of Detroit; an attempt of a conclusion

After detailed examination of all prospects of society – economy, social relations and city planning – it is time to come to a conclusion and to assess the future of an ailing patient - Detroit.

It is forecasted that 0.865 million inhabitants will live in the City of Detroit by 2030.¹ What future remains for a city with such a steady decline of population?

3.1. The problem of insufficient funds

To sum it up in one sentence: the reduced financial bases for local and regional government and the increasing social costs are very alarming. Industrial and residential exodus, as well as a change in federal policies, emptied the funds of the city. The Community Development Block Grants (CDBG) were a major resource for development funds. But as this financial source ran almost dry because other priorities came up, the city's budget has gone in the red.

Actual annexation pattern for the City of Detroit, which shows no new growth after 1926 and so no chance to sustain tax base or keep population within city boundaries. (© Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, 2002)

Illustration 27.

So far, the city could not provide the estimated $200 million⁴ for demolishing vacant structures throughout the city. Some artists, like Camilo José Vergara, say this is a fortune for the architectural and historical legacy of Detroit. Nevertheless, the present situation keeps investors away as there is little interest to construct buildings in abandoned areas. Nevertheless, without the taxes of healthy industrial, commercial and residential areas, the city will face even more problems in the future.

Private, commercial investments in the CBD like the Renaissance Center could be the only answer to this devastating situation, unfortunately, the RenCen itself has proven as a financial disaster. Neighborhood redevelopment projects on the other hand, are very expensive but were also opposed by many displaced residents, predominately blacks.

3.2. Everlasting splits between races and classes

The far away Renaissance for an ancient and overgrown volleyball field. (Courtesy of Lowell Boileau)

Illustration 28.

Racial disunity and conflict, even in the face of growing political power for the city's African Americans, brought a particular kind of devastation. The disparities in education, income, employment and life chances are simply too great between the poor and the rich. Disparity is deeply connected to discrimination since the caused isolation was also based in part on income. The area of Detroit has been riven by racial conflict for so many decades that it seems unrealistic to believe that this will soon change.

The easiest solution to get rid of all the problems would be to create jobs, because tasks bring stability and a sense of meaning into life. Self-destructive patterns such as drugs and crime would burst. But since the future of the economy in the metropolitan areas of Detroit is not that bright, things will hardly change.

3.3. The omnipresence of economic decline

Actually, Detroit has not totally lost its glorious byname “Motor City of the USA”, although the car industry shifted from the manufacturing sector to service sector, and decentralised away from Detroit to the suburbs, to other places in the USA or even to other countries; as manufacturing employment continues to decline, metropolitan Detroit stays a manufacturing center: 22% of Detroit's employment was working in durable goods manufacturing, whereas New York's rate was only 3%, Atlanta's 9% and Los Angeles' 10%⁵. Experts of economical affairs have discordant opinion whether Detroit's economy is just in a temporary recession or is an open-ended decline. Not mattering how the future of Detroit will look like, its contemporary economic condition is in a rather bad shape.

Any steps undertaken by protectionists to tax foreign goods will not have the needed impact on the world economy that would be needed to push Detroit's economy; anyhow, a second car industry emerged in the USA, competing with the Big Three by producing nearly 5 million vehicle units per year and employing 85000 factory workers – more than Chrysler's and almost Ford's working staff. Furthermore, protectionistic measures will provoke retaliation by other countries and may even lead to unemployment in export orientated industries.⁶

For a long time pessimists have announced the end of Detroit. They argue that the American car industry is not healthy enough to sustain two or more big players. Furthermore, they are afraid of the fact that the small earnings of GM, Ford and Chrysler will no longer counterbalance their operational spending costs for technical product innovation, health care and pensions for retired persons.

It would be in the interest of all levels involved in the employment – management, unions and governments – to regain back some of the manufacturing jobs in Detroit. However, since every group has its own, irrevocable views, it is next to impossible to find a common denominator and change the situation in a long-term view.

“To be sure, the end of Detroit's influence on the American automobile industry is a tremendous loss for Detroit. (...) In every corner of Wayne, Oakland and Macomb Counties are office parks and low-rise buildings that are home to suppliers, engineering firms, advertising companies and public relations agencies who owe their existence in some way to GM, Ford or Chrysler. But there is victory in all of this for American consumers. The import's success is being enjoyed by the people who have bought foreign cars and who love their vehicles. Yes, the demise of Detroit is a tragedy for Michigan and other states that depend on the Big Three companies. But investments by foreign companies are a boon to Alabama, Tennessee, Kentucky, Texas, California and other areas.”⁷

Because the City of Detroit has more unemployment and more poverty than the suburbs, it is unlikely that investors will move over to the city, as less wealthy people mean less income and fewer taxes for infrastructure and public services. Suburbs were enjoying federal transportation and housing policies, industrial and commercial rise and massive residential growth. An enormous gap between the city and the outskirts is even further widening.

As I pointed out at the beginning, there are no simple reason why things developed like that; it is the complex history of race, society and employment structure that turned Detroit into the city it is right now.

Detroit could not relieve a great part of its pain which was sometimes self-inflicted, sometimes caused by external circumstances.

In the year 1805, Detroit was on the verge of complete destruction - probably for the first time. As a bakery caught fire, all buildings completely burned down, aside from one single stone house. Local Father Gabriel Richard noted⁸:

“Speramus meliora; resurget cineribus”

or

“We hope for better days; it shall rise from its ashes”

This phrase serves still today as the official motto of the city, imprinted on the city seal. During the manifold history of Detroit, the city has never surrendered to the fight against the diseases like economic decline, racial issues and city planning missteps.

Detroit may be an ailing patient, but its heritage in historical, cultural and social hindsight keeps it far away from being dead or obsolete.

Detroit skyline at night. What next will arrive with dawn?

(Courtesy of Anthony Hiller)

last modified on 01/31/04, 04:05:21

"All ^work and _{no play} makes Jack a dull boy."

Jack's phrase written eternally on endless pages in Kubrick's “The Shining”

4. Bibliography

Books

Arranged alphabetically by the name of the author(s)

• Carlson, L.H., Highland Park oder die Zukunft der Stadt, Berlin, Aufbau Verlag, 1994

• [ Catanese, A.J., The politics of planning and development, Beverly Hills, SAGE Publications, 1984 ]

• Cohen, I., Echoes of Detroit: A 300-Year History, Haslett, City Vision Publishing, 2001

• Darden, J.T., Hill, R.C., Thomas, J., Thomas R., Detroit – Race and Uneven Development, Philadelphia, Temple University Press, 1987

• Duncan, O.D., Social change in a metropolitan community, New York, Russell Sage Foundation, 1974

• Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, Russell Sage Foundation, 2002

• Gavrilovich, P., McGraw, B., The Detroit Almanac, Detroit, Detroit Free Press, 2001

• Georgakas, D., Surkin, M., Detroit: I do mind dying. – A study in urban revolution, London, Redwords, updated edition, 1998

• Hartigan, J., Racial situations: class predicaments of whiteness in Detroit, Princeton, Princeton University Press, 1999

• Henrickson, W.W., Detroit perspectives: crossroads and turning points, Detroit, Wayne State University Press,1991

• Hill, E.J., Gallagher, J., AIA Detroit – The American Institute of Architects Guide to Detroit Architecture, Detroit, Wayne State University Press, 2003

• Kannan, N.P., Downsizing Detroit, New York, Praeger Publishers, 1982

• Sinclair, R., Thompson, B., Metropolitan Detroit: An Anatomy of Social Change, Cambridge(Massachusetts), Ballinger Publishing Company, 1977

• [ Mason, P.L., African Americans, labor and society organizing for a new agenda, Detroit, Wayne State University Press, 2001 ]

• Mathewson, K., Financing the metropolis, New York, Praeger Publishers, 1980

• Maynard, M., The End of Detroit – how the Big Three lost their grip on the American car market, New York, Currency Book, 2003

• [ Meiklejohn, S.T., Wages, race and space: lessons from employers in Detroit’s auto industry, New York, Garland Publishing, 2000 ]

• Sugrue, T.J., The origins of the urban crises: Race and inequality in postwar Detroit, Princeton, Princeton University Press, 1996

• Thomas, J., Redevelopment and race – Planning a Finer City in Postwar Detroit, Baltimore, The Johns Hopkins University Press, 1997

• Thompson, H.A., Whose Detroit? : politics, labor, and race in a modern American city, New York, Cornell University Press, 2001

• Vergara, Camilo J., The new American ghetto, New Brunswick, Rutgers University Press, 2^nd paperback print edition, 1999

• Wolman, H.L., Agius, E.J., National urban policy: problems and prospects, Detroit, Wayne State University Press, 1996

Other references

Single Webpages are stored on the enclosed CD-Rom

5. Appendix

Further Images

Division of labor is a basic component of industrialization. Every worker is assigned a different task in the manufacturing progress and as a result, total production increases. Microsoft ® Encarta ® Encyclopedia 2004. © 1993-2003 Microsoft Corporation. All rights reserved.

Illustration 29.

Illustration 30.

Luxury import companies like Lexus, Mercedes-Benz and BMW are ascend very quickly (and expand the total luxury market, see right chart), while sales of domestic brands like Cadillac and Lincoln seem to retreat.

(© The Detroit News)

Illustration 31.

Overview of South-East Michigan, Metropolitan Area of Detroit and the City of Detroit, (© Gavrilovich, P., McGraw, B., The Detroit Almanac, Detroit, 2001, map got edited)

Illustration 32

The riot of 1967 in Detroit. (© The Detroit News)

Illustration 33

Illustration 35. Population change between 2000 and 2030, esimations. (see (regional development forecast)2030_RDF_report.pdf on enclosed CD-Rom), (© SEMCOG)

Economic status by place of residence and race, 1950 and 1990 (© Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, 2002)

Illustration 36.

In 2000, The Big Three's combined market share was as low as abou6t 65.6% (© The Detroit News)

Illustration 37.

Origins of the population of Metropolitan Detroit, 1920 to 1990. (© Farley, R., Danziger, S., Holzer H.J., Detroit divided, New York, 2002)

Illustration 38.