Posted on 06/15/2012 6:58:53 AM PDT by MichCapCon
Imagine a city where all the major economic planks of the statist or "progressive" platform have been enacted:
* A "living wage" ordinance, far above the federal minimum wage, for all public employees and private contractors.
* A school system that spends significantly more per pupil than the national average.
* A powerful school employee union that militantly defends the exceptional pay, benefits and job security it has won for its members.
* Other government employee unions that do the same for their members.
* A tax system that aggressively redistributes income from businesses and the wealthy to the poor and to government bureaucracies.
Would this be a shining city on a hill, exciting the admiration of all? We don't have to guess, because there is such a city right here in our state: Detroit
Detroit has been dubbed "the most liberal city in America" and each of these "progressive" policies is alive and well there. How have they worked out?
In 1950, Detroit was the wealthiest city in America on a per capita income basis. Today, the Census Bureau reports that it is the nation's 2nd poorest major city, just "edging out" Cleveland.
Could it be pure coincidence that the decline occurred over the same period in which union power, the city government bureaucracy, taxes and business regulations all multiplied? While correlation is not causation, it is striking that the decline in per capita income is exactly what classical economists predict would occur when wage controls are imposed and taxes are increased.
Specifically, "price theory" predicts that artificially high business costs caused by excessive regulation and above-market labor compensation rates imposed by so-called "living wages" will lead to an increase in unemployment. Detroit's minimum wage is more than $2 above the federal minimum wage; and pressure groups are pushing for more. Additionally, any company contracting with the city must pay its employees $11.03 an hour if they offer benefits or $13.78 an hour if they do not.
Such high wage mandates are especially hard on individuals with a poor education and low skills. If struggling and heavily taxed businesses cannot pay such high wages, then they are more selective about the few workers they do hire or simply go out of business altogether. Those who have promulgated these polices may be well-intentioned, but mainstream economists have warned for decades that such policies were very likely to bring about the abject poverty and unemployment that characterize Detroit today. The city has the highest unemployment rate among all large U.S. cities.
A similar pattern has played out in public education. It is now conventional wisdom among the political class that higher pay for teachers and increased spending per student lead to improvements in teacher quality and student performance -— Detroit Public Schools strongly suggests that this theory must be rejected. It has chronically underperformed state averages, yet reforms are vehemently opposed by the system's powerful school employee union.
At the same time that union, the Detroit Federation of Teachers, has won rich salary and benefits packages for its members. Detroit spends one of the highests amounts of money per student nationwide and the district's spending per pupil is eighth highest out of Michigan's 551 school districts. For all that, by almost any measure Detroit schools have for decades failed their students: test scores, safety, drop out rates, etc. Detroit's public school students perform among the lowest in the state. On a 2009 test for urban districts from the U.S. Department of Education, DPS students performed "barely above what one would expect simply by chance, as if the kids simply guessed at the answers."
In the private sector such failure would result in mass firings for unsatisfactory performance. No doubt such a response would be condemned by the progressives who support the school employee unions that have made similar actions impossible in their institutions, and have opposed major transformation at every turn.
For example, in 2003 philanthropist Bob Thompson offered $200 million to build 15 charter public schools in the city in which he would guarantee a 90 percent graduation rate. In response, the DFT balked because charter schools are not unionized. The outcome was that the union jobs trumped better outcomes for children.
People vote with their feet, and all the above suggests why, over the past decade, DPS has lost about 10,000 students each year to charter, independent and suburban schools.
Of course it would be unfair to place all the blame for the city's decline on public employee unions. Detroit is home to the Big Three, whose contracts with their own powerful unions provided the model for those public employee arrangements. The UAW successfully extracted wages and benefits estimated at $73 per hour before the recent shake-ups began.
This is about $25 more per hour than the amount foreign-owned U.S. auto manufacturing plants pay their non-unionized American workers. Due to this disparity, Japanese car companies earn some $1,000 to $2,000 more on each car sold than their American counterparts. The outcome has been a relentless loss of market share that, among other things, has devastated the economic engine that once powered Motor City prosperity.
In addition to being a model of progressive economic, labor and education policy, Detroit is also a case study in welfare statism. Tom Bray, former editorial page editor for The Detroit News, has made the following observation:
"Detroit, remember, was going to be the 'Model City' of Lyndon Johnson's Great Society, the shining example of what the 'fairness' of the welfare state can produce. Billions of dollars later, Detroit instead has become the model of everything that can go wrong when you hook people on the idea of something for nothing - a once-middle class city of nearly 2 million that is now a poverty-stricken city of less than 900,000."
Today, Detroit is down 25 percent over the past 10 years; to just over 700,000 and dropping fast.
Progressives will complain that this portrait oversimplifies the factors involved in a great city's decline. Perhaps it does, but with this question in mind: At what point does the weight of evidence and logic make it impossible to avoid concluding that in the case of Detroit, correlation is causation?
So is it the same story for Cleveland?
(No, wait let me guess...)
So is it the same story for Cleveland?
(No, wait let me guess...)
So is it the same story for Cleveland?
(No, wait let me guess...)
There’s nothing wrong with the policies, it’s just that the wrong people have been implementing them.
I know! I know! 40 + years of Democratic rule?
Obviously, the failure here is that other cities and states didn’t enact the same laws, thus creating havens for those who won’t do ‘the right thing’ and ‘pay living wages’ to their workers.
What is needed is laws to prevent people from leaving, especially those with money....
Because, of course, there was nothing wrong with the liberal policies....
Mmm... Sarcasm. It’s what’s for breakfast.
No, it’s the fault of selfish white people moving to the suburbs instead of staying within the city limits and paying taxes to the City of Detroit.
Its the same for most cities but they’re still writing checks.
Ditto for less than 5 miles to the east. I never thought I'd live to see the day when unemployment on the Canadian side would be lower than in the USA.
I’ve (briefly) been to both cities and my impression was that Cleveland is in far better shape. I did, however, make the mistake of riding through the ghetto along St. Clair in the east end at midnight during a heat wave- never again!
You’re right. Those people sold their houses for 30 and 40 thousand, built new homes in the suburbs that cost them twice or three times that amount and avoided giving them away at auction 30 years later. By the way, many of those were black people also that could see the writing on the wall and moved to insure a good education for their children.
BUMP!
They moved out because they could see the social devolution headed their way.
I spent a weekend at the home of a friend just outside Battle Creek- awesome country that way. Never been to the northern part of the state, but others have told me it is much like “cottage country” on our side of Lake Huron.
What is needed is laws to prevent people from leaving, especially those with money....
You may say that in sarcasm. But our Liberal Elites in both parties would like to do that very thing to the rest of us. I believe its just a matter of time before they figure that they can get away with it. It’ll just take a little more dumbing down of the kids in the public schools.
So, what Republican can they blame? George Bush?
On the other side of the state, we are in a different universe.
I can still hear those inspiring words of that great Founder of Detroit Ruination on the first day of his reign, Coleman Young. “Hit Eight Mile”
No, it’s the fault of selfish white people moving to the suburbs instead of staying within the city limits and paying taxes to the City of Detroit.
I have actually heard that from assorted DUmmies. It’s unbelievable how addled these people are.
Lets also not forget that half of the administration have either been indicted or are already in jail.
Actually, Detroit's woes can be laid directly to former Mayor Coleman Young who ran the city from 1974 to 1993. Young was a racist who decided to use Detroit's finances to enrich himself and his friends while he directly attacked the “white devils” that lived in the city. Young's followers were very effective in driving whites out of Detroit. Unfortunately for Detroit, this exodus took good jobs and the tax base along with it. Left behind was a decaying, hollow shell of a city with crumbling buildings, soaring crime, increasing welfare rolls, and deteriorating infrastructure.
Can Detroit be saved?
No. This whole edifice known as Detroit cannot be salvaged. At least 40 percent of the city needs to be torn down and converted to farm land, but there's no money. The city needs to shrink and consolidate, but it can't due to monetary and political reasons. The city has even tried to sell foreclosed homes, but couldn't get takers at only $1. The population of the city keeps shrinking and so do revenues. No change is possible because almost everything in Detroit is under the control of the Detroit teacher's union and the Detroit public employee's unions. Together, they block any and all needed reforms and Detroit continues to spiral into oblivion. Detroit is the shining poster child for fully implemented liberal policies. Those residents that remain keep repeating the same insane policies with the same kinds of politicians in the hopes of a different result. Isn't going to happen — Detroit is dead.
bookmark
Nice.
I took that photo last fall.
1.) It wasn't just the social devolution, but the everything collapse.
2.) I grew up in Michigan. Detroit had the sheer numbers of people and economic clout to demand—and get—a hugely disproportionate share of the state's tax revenues. It rewrote laws to favor itself and unions. It did everything imaginable to enforce its perception of itself not just as the queen city, but the core of the whole state.
I left in 1980. I went back for family members' funerals. The last of my family abandoned Michigan a couple years ago. There's nothing to go back to. There's no reason to waste time, effort, and money visiting a failed state. Michigan let Detroit have its way, and Detroit wrecked not only itself, but the whole state. New York City has done the same thing to the state of New York. Chicago has done the same thing to Illinois. Seattle is doing it to Washington. Michigan is "ahead" of some states: the the inevitable collapse has occurred sooner and is more dramatic.
What's the cause of these failures? I think we're looking at a combination of two primary factors: Marxism and urbanism. Lyndon Johnson's so-called "great society" was a scheme to buy votes for representatives of the Democratic [sic] party with dollars from the U.S. Treasury. He didn't invent that scheme: merely expanded Franklin Roosevelt's idea. As the Democratic [sic] party turned more openly Marxist, it rewarded itself with more and more of the nation's hard-earned tax dollars. Concurrently, urban "values"—I admit the term is something of a stretch—triumphed over rural values throughout the state. Detroit and Detroit area politicians teamed up with union goons to "redistribute" state tax dollars to Detroit (union) schools, Detroit (union) infrastructure, Detroit (union) commercial construction and expansion, and of course, the Detroit (union) automobile industry. Corruption reigned surpreme, of course, and made incompetence the standard in every undertaking. None of that benefitted the rest of the state, but the rest of the state foolishly picked up the tab for it.
The Marxists and urban looters joined forces to destroy Detroit and Michigan. There's nothing left to salvage. There's no way to undo the damage resulting from widespread illiteracy. Nobody wants the abandoned blocks and blocks of houses, the crumbling streets, the abandoned factories, or any of the rest of it. There's no value left, nor any chance of restoring it. The same process is destroying other cities and states all across the country. You and I think, "What a horrible waste!" but we're missing the point. We're looking at dead trees, not vanished forests. What the Marxists and urban looters have done to Detroit and Michigan is what they intend to finish doing to America. Detroit and Michigan are their idea of a success, not a failure.
If I recall correctly, the sale of houses for $1 was part of “urban homesteading”, in which people got to buy a house for a dollar, but then also agreed to live in the house and fix it up.
If I’m recalling this correctly, that right there caused failure of a well intentioned program. How many of us would willingly move to inner city Detroit, just because we could buy a house for one dollar? How many of us would put up with all of the other problems and mayhem of that city, just because we got a bargain price on a house?
Although there is nothing wrong with the original article, it leaves out (perhaps intentionally) something very important, perhaps the underlying reason why Detroit has deteriorated to the state in which it is today.
What is it that the author -not- mention?
You are exactly right on all points. Who in their right mind would agree to homestead, much less fix up a rundown house, in Detroit?
First, you’re going into a war zone where everything you have is subject to theft and you’re setting yourself up for robbery, rape, or murder.
Second, by fixing up the deteriorating house you get hit with the double whammy. The price of your sweat equity will not make the house worth more, nor will it sell for any kind of profit to you. The city will take any improvements that you make and jack your property taxes out of sight (because they’re broke) and you’ll never see any benefit.
Who thought of this harebrained scheme obviously did not practice what they advocated. Epic FAIL (obviously).
Don't call me a racist, I'm not. If you want to call me something derogatory call me a pessimistic realist. I didn't make up those data out of thin air, I just took them from the census bureau's own data. Voter preference based primarily on skin color and a socialistic fiscal policy may not be the only negative factors in Detroit's unprecedented decline into near-3rd world status over a relatively short period of time, but no one can deny that those are 2 of the most important factors in that decline.
BTTT your post.
re: “Marxism & Urbanism”
This is a corollary to the “Great Compromise” ensconced in the Constitutional idea of bicameralism. Back then, it was big states that were the worry. Now it’s big cities. As urbanism grows (think: illegal immigration) more states will have such big cities, with the expectation that current red states turn to blue. (Even though it’s the Dem-voting states that should be “red” states, but that’s the media for ya.)
Who are you going to believe some liberal documentary or someone who actually lived just South of 8 Mile Road and moved to the suburbs early on?
I intended for my post #35 to answer your #33, but I neglected to address it to you. I assumed that the data I posted in #35 had something to do with your closing question in #33, but if not just ignore me.
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