The Poverty of Detroit

            Have you noticed the media’s tendency to focus on the trivial and unserious, and in doing so magnify them beyond any reasonable proportion? The corollary to this is that more severe issues, that are longer lasting and deep seated, get ignored.

            In the wake of the Zimmerman trial, the last few weeks have been pretty slow in terms of news. The headlines have been largely dominated by the Weiner scandal and the opening squabbles of the 2016 GOP primary. The summer months bring a fade in the import of the political, and rightfully so. One can only take too much politics.

            However, there was another story that popped up and then rapidly died, whose causes and effects are far more fundamental to the era in which we find ourselves. I’m speaking, of course, of the declared bankruptcy of Detroit. Detroit, once synonymous with America’s industrial might (and the fourth largest city), is now synonymous with decay, corruption, and severe poverty.

            Aside for a few op-eds, Detroit has been ignored by the general political discourse. My theory as to why is the content of this post. Detroit, its poverty and dysfunction, represents a sharp rebuke to the conventional economic philosophy of both parties. It’s decline is a challenge not only to the conventions and economic orthodoxy liberalism (which has governed it unobstructed for over fifty years) but also to conservatism. Detroit is really a question about poverty – what causes it and how it can be fixed. With the ongoing stagnation of the economy, the weakening of the American middle class, and the fall in income mobility and economic optimism, understanding Detroit is about understanding our current malaise, and the potentiality for a solution

The Left’s Solution

            I considered reviewing all of the economic numbers for Detroit that highlight its decline, but that’s mostly unnecessary. The images of Detroit, with its barren fields and abandoned buildings constructed during a more prosperous era, tell the story. The population has fallen from 1.8 million in 1950 to 700,000 in 2010. The unemployment for the city stands at 15.8%, well above the national average. Over 31% of Detroit families live in poverty along with over 36% of individuals. Homes sell for a $1 a piece, and for many streets basic services such as lights have long since shut down. Entire zones have been declared unofficial no-go areas, with emergency services showing up only after a twenty minute wait, if the crime is severe enough. Crime of all sorts is high and shows no sign of abating, unlike the national trend.

            The left has a particular burden of proof when explaining Detroit, because the city and the state have long been a center of leftism in action. The failures of this city cannot be blamed on an obstructionist Republican Congress or the local GOP. The Republican Party in Detroit is non-existent.

            Because of this, the failure of Detroit is blamed on a variety of macro-trends, outside of the power of local government, thus excusing leftist economic policy from any failures or shortcomings. They are as follows:

1.      Capitalism. Free trade caused increased pressure on the workers to work at a cheaper wage. When they were unwilling to do so, the companies shipped their jobs overseas.

2.      White Flight. Racists whites left the city for the suburbs, and abandoned the black population. Whites couldn’t handle a black mayor, and did everything in their power to sabotage him and the city.

3.      The Automotive Industry. Detroit was entirely dependent on the automotive industry. Because the auto industry has declined, Detroit’s fortunes have declined as well. Detroit’s failures are due to the misfortune or bad luck of having been a mono-industry city. See Youngstown, OH, Gary, IN, Cleveland, OH, Buffalo, NY and to a lesser extent Toledo, OH and Pittsburgh, PA.

There may be more reasons that I’m missing, but those three capture the main thrust of their argument. It’s not our fault Detroit’s failed! Look over here! Or there!

To an extent, all of these reasons have some grounding in the truth, but they don’t explain the particular severity of Detroit’s crisis. Moreover, and the thrust of what I’m getting at, they leave a large question remaining – Now what? Let’s suppose all of those outlined factors are true. What is the liberalism’s answer to the poverty of Detroit? What is the solution?

And it is here, I think, that the left has a huge problem. Even if all of these larger forces are the sources of Detroit’s demise, how does modern liberalism seek to address them? The left’s answer seems to have taken on two parts, at made evident by its governing policies.

1. Increase demand. If we keep wages high (through unionization, protection of workers) and create lots of make work projects (building bridges, sports centers, public work projects) we’ll create enough demand in the economy that jobs will come back.

2. Soften the effects of poverty by keeping public assistance programs (food stamps, welfare, etc) fully funded.

That seems to be it. Oh wait, I forgot one more.

3. Education. Increase funding to public schools and universities so people can get high paying jobs that require higher education (in an entirely unrelated coincidence, teachers and higher education employees are major contributors to the Democratic Party).

Note that none of these proposed solutions even begin to solve Detroit’s problems. How do I know this? Because they’ve been tried.

The wages of the big three have long been higher than the trend for the rest of their sector. Detroit has had a multiplicity of public works programs. They even have a monorail! But these public works programs have done little to turn the city around, and even less to dint poverty of the city. It’s my suspicion that the main benefactors are the politicians who get to attend a ribbon cutting ceremony and the contractors who get to pocket the profits of building whatever public project that will be abandoned and vandalized in 10, no 5, years’ time.

As for point two, there may be a case that due to the severity of Detroit’s economic problems (and the national economy as well), we should give all we can through public assistance programs to lessen the pains of poverty. Fine, but we should give up the illusion that these programs end poverty. Does anyone seriously believe that if we increased food stamp and welfare spending for Detroit, along with raising the minimum wage, that it would soon turn into a Silicon Valley?

As for education, Detroit public schools spend anywhere from $12,801 - $15,570 per pupil, well above the national average of $10,615 per pupil. And what do the people of Detroit get in return for such spending? A city that is 47% functionally illiterate, and a graduation rate of 68%. Will $18k per pupil get us a city that is broadly literate? $20k? How about $25k? Those that say yes, go to the back of the classroom.

My point isn’t to beat up on the city of Detroit. I imagine a majority of the city’s population are hardworking individuals who want what’s best for their family and want to escape a city mired in poverty. My point is instead to show the lack of solutions offered to us by economic liberalism. And why do I do that? Because their solutions for Detroit are the same solutions they offer for the rest of America. What is Obama’s economic policy? High public spending, increased spending on social support funding, and higher education spending. If those policies have not, and cannot work in Detroit, why should we expect them to work in the rest of the country?

An addendum:

This post was originally going to be longer, highlighting the lack of solution’s from the right. The right’s diagnosis for Detroit is that it was killed by unions, large public pension plans, and poor government. These might all be true, but again they don’t offer a solution. Should we lower taxes in Detroit? If so, given the city’s already low tax base, how are they going to provide rudimentary services? The stimulative power of tax cuts eventually loses its effects. Charter schools? They may work, but they take a long time to reverse severe gulfs in education, and they are no guarantee that their graduates will stay locally. Dismantle the unions? And how will the workers make their new living in a world of ever higher costs?

I can’t say definitively what caused Detroit to decline. But I can say that the solutions from both the right and left (but primarily the left) are extremely wanting. Detroit is a part of America, and its citizens should not be deprived the opportunities inherent in American citizenship and liberty because of the poor decisions of their elected leaders and others.