The city of Detroit has gone through a major economic and demographic decline in recent decades. The population of the city has fallen from a high of 1,850,000 in 1950 to 701,000 in 2013. The automobile industry in Detroit has suffered from global competition and has moved much of the remaining production out of Detroit. Some of the highest crime rates in the United States are now occurring in Detroit, and huge areas of the city are in a state of severe urban decay. In 2013, Detroit filed the largest municipal bankruptcy case in U.S. history.^[1][2]

Contributors to decline

The deindustrialization of Detroit has been a major factor in the population decline of the city.^[3]

Automobile industry

Neo-Marxist economist Richard D. Wolff writes that Detroit's automobile industry failures in the global economy are a major factor in Detroit's decline. He says that the car companies failed to anticipate changing consumer requirements in the 1970s, and that they sought ways to undermine gains made by the Detroit-based labor force, represented by the United Automobile Workers union. Automobile company leadership (shareholders and directors) decided to move production away from Detroit because of lower wages found elsewhere; this critically hurt Detroit. Wolff writes that US auto worker wages have not increased in real buying power since the 1970s, but that production has increased, yielding greater profits which are not shared with the worker. In 2007, the union accepted wage cuts, adopting a two-tier system. During the global automotive industry crisis of 2008–10, the US government gave $17.4 billion to Chrysler and General Motors to bail them out, but the city of Detroit was not similarly aided. Wolff says that Detroit served as a success story for capitalism in the 1950s and '60s, but in the next four decades, capitalism was responsible for the city's deep decline.^[4]

People in well-off suburban areas also made it impossible for Detroit to expand via annexation by incorporating unannexable charter townships with as few as 750 residents all around the city. As a result the Detroit Metro area has 330 local governments.^[5]

1950s job losses

Packard Automotive Plant, closed since 1958.

In the postwar period, the city had lost nearly 150,000 jobs to the suburbs. Factors were a combination of changes in technology, increased automation, consolidation of the auto industry, taxation policies, the need for different kinds of manufacturing space, and the construction of the highway system that eased transportation. Major companies like Packard, Hudson, and Studebaker, as well as hundreds of smaller companies, declined significantly or went out of business entirely. In the 1950s, the unemployment rate hovered near 10 percent.

1950s to 1960s freeway construction

Freeway construction in the 1950s and 1960s cut through the most densely populated black neighborhoods of Detroit. The demolition of buildings in Lower East Side, Lower West Side, Paradise Valley, and the Hastings Street business district, and the subsequent physical barriers caused by the freeways, split and reduced the thriving neighborhoods. In the 1950s, 2800 buildings were removed just for the Edsel Ford Expressway, including jazz nightclubs, churches, community buildings, businesses and homes.^[6]

1967 Detroit riot

The summer of 1967 saw five days of black riots in Detroit.^[7][8] Over the period of five days, forty-three people died, of whom 33 were black and ten white. There were 467 injured: 182 civilians, 167 Detroit police officers, 83 Detroit firefighters, 17 National Guard troops, 16 State Police officers, 3 U.S. Army soldiers.

2,509 stores looted or burned, 388 families rendered homeless or displaced and 412 buildings burned or damaged enough to be demolished. Dollar losses from arson and looting ranged from $40 million to $80 million.^[9]

Economic and social fallout of the 1967 riots

Per capita income in Detroit and surrounding region from the 2000 census. The dotted line represents the city boundary.

After the riots, thousands of small businesses closed permanently or relocated to safer neighborhoods, and the affected district lay in ruins for decades.^[10]

Of the 1967 riots, politician Coleman Young, Detroit's first black mayor, wrote in 1994:

The heaviest casualty, however, was the city. Detroit's losses went a hell of a lot deeper than the immediate toll of lives and buildings. The riot put Detroit on the fast track to economic desolation, mugging the city and making off with incalculable value in jobs, earnings taxes, corporate taxes, retail dollars, sales taxes, mortgages, interest, property taxes, development dollars, investment dollars, tourism dollars, and plain damn money. The money was carried out in the pockets of the businesses and the white people who fled as fast as they could. The white exodus from Detroit had been prodigiously steady prior to the riot, totally twenty-two thousand in 1966, but afterwards it was frantic. In 1967, with less than half the year remaining after the summer explosion—the outward population migration reached sixty-seven thousand. In 1968 the figure hit eighty-thousand, followed by forty-six thousand in 1969.^[8]

According to the black conservative economist Thomas Sowell:

Before the ghetto riot of 1967, Detroit's black population had the highest rate of home-ownership of any black urban population in the country, and their unemployment rate was just 3.4 percent. It was not despair that fueled the riot. It was the riot which marked the beginning of the decline of Detroit to its current state of despair. Detroit's population today is only half of what it once was, and its most productive people have been the ones who fled.^[7]

1970s and 1980s

The 1970 census showed that whites still made up a majority of Detroit's population. However, by the 1980 census, whites had fled at such a large rate that the city had gone from 55 percent white to only 34 percent white in a decade.

Economist Walter E. Williams writes that the decline was sparked by race-based city policies which caused more affluent whites to leave the city (sometimes known as "White flight"), reducing the tax base, and leading to fewer employment opportunities and customers in the city.^[11] The departure of middle class whites left blacks in control of a city suffering from an inadequate tax base, too few jobs, and swollen welfare rolls.^[12] According to Chafets, "Among the nation’s major cities, Detroit was at or near the top of unemployment, poverty per capita, and infant mortality throughout the 1980s."^[13]

Detroit became notorious for violent crime in the 1970s and 1980s. Dozens of violent black street gangs gained control of the city's large drug trade, which began with the heroin epidemic of the 1970s and grew into the larger crack cocaine epidemic of the 1980s and early 1990s. There were numerous major criminal gangs that were founded in Detroit and dominated the drug trade at various times; most were short-lived. They included The Errol Flynns (east side), Nasty Flynns (later the NF Bangers) and Black Killers and the drug consortiums of the 1980s such as Young Boys Inc., Pony Down, Best Friends, Black Mafia Family and the Chambers Brothers.^[14] The Young Boys were innovative, opening franchises in other cities, using youth too young to be prosecuted, promoting brand names, and unleashing extreme brutality to frighten away rivals.^[15]

Several times during the 1970s and 1980s Detroit was named the arson capital of America, and repeatedly the murder capital of America. Often Detroit was listed by FBI crime statistics as the "most dangerous city in America" during this time. Crime rates in Detroit peaked in 1991 at more than 2,700 violent crimes per 100,000 people.^[16] Population decline left abandoned buildings that have become magnets for drugs, arson, and other crime. Such violent crimes has also pushed tourism away from the city, and several foreign countries even issued travel warnings to the city.^[16]

Around Halloween, a traditional day for pranks in late October, Detroit youth went on a rampage called "Devil's Night" in the 1980s. A tradition of light-hearted minor vandalism, such as soaping windows, had emerged in the 1930s, but by the 1980s it had become, said Mayor Young, "a vision from hell."^[17]

The arson primarily took place in the inner city, but surrounding suburbs were often affected as well. The crimes became increasingly destructive. Over 800 fires were set in the peak year 1984, overwhelming the city's fire department. Hundreds of vacant homes across the city were set ablaze. In later years, the arson continued, but the number of fires was reduced by razing thousands of abandoned houses that often were used to sell drugs—5000 in 1989-90 alone. Every year the city mobilizes "Angel's Night," with tens of thousands of volunteers patrolling areas at high risk.^[18][19]

Problems

Population decline

As Detroit's abandoned houses have been demolished, gaps in the previously urban environment have emerged, which is sometimes called urban prairie.

Long a major population center, Detroit has been going through a major reduction in population; the city has lost about 60% of its population since 1950.^[20] A Michigan web site compares Youngstown, Ohio to Detroit on a much smaller scale due to its own economic problems.^[21]

Detroit reached its population peak in the 1950 census at over 1.8 million people, and decreased in population with each subsequent census; as of the 2010 census, the city has just over 700,000 residents, adding up to a total loss of 60% of the population.^[22][23]

A major change in the racial composition of the city also occurred over that same period; from 1950 to 2010 the black/white percentage of population went from 16.2%/83.6% to 82.7%/10.6%.^[24] Approximately 1,400,000 of the 1,600,000 white people in Detroit after World War II have left the city, with many going to the suburbs.^[25]

Unemployment

According to the U.S. Department of Labor Bureau of Labor Statistics, of the 50 largest cities in the country, Detroit has the highest unemployment rate, at 23.1%.^[26]

Poverty

The U.S. Census Bureau's Statistical Abstract of the United States: 2012 ranks Detroit last among all 71 U.S. cities for which rates were calculated in percentage of the city's population living below the poverty level. The individual rate living below the poverty level is 36.4%; the family rate is 31.3%.^[27]

Urban decay

Dance floor of the Vanity Ballroom Building in 2010.

The Film Exchange Building in 2012.

A significant percentage of housing parcels in the city are vacant, with abandoned lots making up more than half of total residential lots in many large portions of the city.^[28] With at least 70,000 abandoned buildings, 31,000 empty houses, and 90,000 vacant lots, Detroit has become notorious for its urban blight.^[29][30]

Detroit has been described by some as a ghost town.^[30][31] Parts of the city are so thoroughly abandoned they have been described as looking like farmland or even completely wild.^[25]

In 2010 Mayor Bing put forth a plan to bulldoze one fourth of the city.^[32] The plan was to concentrate Detroit's remaining population into certain areas to improve the delivery of essential city services, which the city has had significant difficulty providing (policing, fire protection, schooling, trash removal, snow removal, lighting, etc).^[30] In February 2013 the Detroit Free Press reported the Mayor's plan to accelerate the program.^[33] The project has hopes "for federal funding to replicate it [the bulldozing plan] across the city to tackle Detroit’s problems with tens of thousands of abandoned and blighted homes and buildings." Bing said the project aims "to rightsize the city’s resources to reflect its smaller population."

The average price of homes sold in Detroit in 2012 was $7,500; as of January 2013 47 houses in Detroit were listed for $500 or less, with five properties listed for $1.^[31] Despite the extremely low price of Detroit properties, most of the properties have been on the market for more than a year as buyers balk at the boarded up, abandoned houses of Detroit.^[31] The Detroit News reported that more than half of Detroit property owners did not pay taxes in 2012, at a loss to the city of $131 million (equal to 12% of the city's general fund budget).^[34]

Crime

Detroit has some of the highest crime rates in the United States, with a rate of 62.18 per 1,000 residents for property crimes, and 16.73 per 1,000 for violent crimes (compared to national figures of 32 per 1,000 for property crimes and 5 per 1,000 for violent crime in 2008).^[35] Nearly two-thirds of all murders in Michigan in 2008 occurred in Detroit.^{[36][not in citation given]} A 2012 Forbes report named Detroit as the most dangerous city in the United States for the fourth year in a row. It cited FBI survey data that found that the city's metropolitan area had a significant rate of violent crimes: murder and non-negligent manslaughter, forcible rape, robbery, and aggravated assault.^[37][38]

According to Detroit officials in 2007, about 65 to 70 percent of homicides in the city were drug related.^[39] The rate of unsolved murders in the city is at roughly 70%.^[40]

City finances

On March 1, 2013, Governor Rick Snyder announced the state was taking over the financial control of the city from the local government.^[41] The state is requesting a review team to look over the financial state of the city and determine if an emergency manager is needed to take over control of city spending from city council.^[41]

On March 14, 2013, Michigan's Local Emergency Financial Assistance Loan Board (ELB) appointed an emergency financial manager, Kevyn Orr, effective on March 25, 2013.^[42] In mid-May 2013, Orr released his first report on Detroit’s finances since he took the job.^[43][44] The results were generally negative regarding Detroit’s financial health.^[43][44] The report said that Detroit is "clearly insolvent on a cash flow basis."^[45] The report said that Detroit will finish its current budget year with a $162 million cash-flow shortfall^[43][44] and that the projected budget deficit is expected to reach $386 million in less than two months.^[43] The report said that costs for retiree benefits are eating up a third of Detroit’s budget and that public services are suffering as Detroit's revenues and population shrink each year.^[44] The report wasn't intended to offer a complete blueprint for Orr's plans for fixing the crisis; more details about those plans are expected to emerge within a few months.^[44]

After several months of negotiations, Orr was ultimately unable to come to a deal with Detroit's creditors, unions, and pension boards^[1] and therefore filed for Chapter 9 bankruptcy protection in the Eastern District of Michigan U.S. Bankruptcy Court on July 18, 2013.^[46] On July 18, 2013, Detroit filed for Chapter 9 municipal bankruptcy, the largest U.S. city ever to do so, with outstanding financial obligations to more than 100,000 creditors totaling approximately $18.5 billion.^[47]

See also

	Detroit portal
	Michigan portal

• History of Detroit
• Shrinking cities in the United States

References

External Links

Wikimedia Commons has media related to: Abandoned buildings in Detroit, Michigan

• Modern Ruins of Abandoned Detroit (PHOTOS)