The roots of Detroit’s bankruptcy
Detroit may be the first major U.S. city to file for bankruptcy, but it may not be the last.
Nor did it come as a surprise. As Governor Snyder said on July 18th, this bankruptcy has been six decades in the making. Two interrelated realities explain Detroit’s empty coffers: race and disinvestment.
Professor John Powell, Executive Director of Haas Institute for a Fair and Inclusive Society at the University of CA at Berkeley and a Board member of the Center for Social Inclusion, grew up in Detroit, living there from 1960 to 1995. Not one auto plant was built inside the city of Detroit during that time. Auto industry jobs were moving to the suburbs.
In 1960, 56 percent of the jobs in the Detroit metropolitan area were in Detroit proper. By the late 1990s, only 18 percent of the jobs were in the city.
We no longer allow intentional discrimination. But Detroit, like many other cities, is living the reality of the disinvestment that came with it. When white Detroiters began tramping their way to the newly minted suburbs of the 1950s, the city was 75 percent white. Now it’s 81 percent black.
The city’s population dropped 10 percent just from 1950 to 1960, largely due to federal policies that tilled the soil for the suburbs with federal highways, federal mortgage guarantees for white home buyers and good old fashioned race discrimination. The automobile industry was booming. Its white middle class workers were simply leaving the city to go to the suburbs.
Do the math and that is six decades.
The suburban population grew by 25 percent. And so began the physical and psychological race line of the 20th century. Black people who came to Detroit from the South in search of better jobs found themselves corralled in racially segregated neighborhoods, barred from better jobs in the automobile industry and refused admission into the growing suburbs.
The motor city also became a chocolate city. And the tax base that supported city schools, transit, water, sewer and garbage services shrank. By the 2000 census, Detroit had become the country’s most segregated city.
Segregation costs money. According to Smart Growth America, suburban development costs 38 percent more than compact, urban development. Poor city-dwellers subsidize those suburbs. As Professor Myron Orfield points out, “upscale suburbs on the edge of metropolitan areas thrive in large part because they receive the lion’s share of public investment in new roads and sewers, which are paid for by everyone in the region.”
Transportation is a poignant example. Blacks and Latinos are six times more likely to rely on public transit than whites. Meanwhile, most of our federal transportation dollars go to highways, leaving many blacks and Latinos 90 minutes from jobs by public transit.
Adding insult to injury, these transit riders are likely to be subsidizing those middle class suburban commuters. Largely white regional rail riders (read suburbanites) in the Philadelphia metropolitan area, for example, paid about 38 percent of the actual cost of their commuter trip into the city to work. Black riders on city buses paid over 63 percent of the cost of the ride.
Since 2010, eight cities, including Detroit, have filed for bankruptcy. Race is a factor in most of them. Five of the eight are predominantly Black and/or Latino – Detroit; San Bernardino, CA; Stockton, CA; Jefferson County, AL; Harrisburg, PA and Central Falls, RI. The other two, Boise, ID and Mammoth Lakes, CA are predominantly white, but even Mammoth Lakes has a significant (33 percent) Latino population.
And suburbs, particularly the ones on the borders of cities, are not safe either. USA Today is predicting that eight other California cities may go bankrupt. All are majority people of color. As people of color have been moving into suburbs in search of better schools, housing and jobs, these suburbs are struggling to pay for infrastructure. Low wage workers have less income to tax and their tax bases shrink.
General Motors and Chrysler received $80 billion in loans and other help from both Presidents George W. Bush and Barack Obama. Both administrations projected saving about 1 million jobs as a result.
What did black Detroiters get? Emergency management and blame. Certainly Detroit has had its share of bad mayors. But no one mayor is responsible for six decades of disinvestment and no Detroiter of any race should lose the primary promise of democracy – elected government.
Racial fairness has to be at the center of all of the solutions to starving cities or we will ignore the roots of the problem. Investment in the innovation happening in black Detroit communities is an important place to start.
Residents are planting gardens and creating relationships with rural white farmers to bring healthy produce to their neighborhoods. Residents are creating broadband access, critical infrastructure in a 21st century economy. They are fighting for more and better bus routes and the ability to decide how vacant land might be used for economic development.
We must stop blaming black people for six decades of disinvestment. We need to recognize that the future of our suburbs is linked to black people who will extend a hand to them to build a brighter future for everyone.
Maya Wiley, Founder and President of the Center for Social Inclusion