Letter from Rome: Lessons from Detroit’s Decline and Fall

Dear friends of Istituto Acton,

As a native of Flint, Michigan, I know what a down-and-out city looks like and the effects it has on its people. As I recently told Vatican Radio, Flint has been a microcosm of Detroit for decades: when things were going well for the automobile industry, things were going well for these cities, but, as is now painfully evident, when things go bad, they go really bad. My parents and brother still live in Flint and I still call it my hometown, but there’s not a whole lot to boast about. In fact, one of the good things about being raised in a place like Flint is that, objectively speaking, just about anywhere else you live will be an improvement.

But human beings aren’t completely objective, especially about their hometowns, so I still take a certain amount of pride about being from, and having survived, Flint. And looking past my adolescent rivalries with competing high schools in the area, those of us from the I-75 corridor stretching from Saginaw to Detroit are all in the same boat, having suffered the same fate of living in a once-thriving part of the state of Michigan, which itself has lagged far behind the rest of the country when it comes to economic growth and opportunity. The general sense of decline is probably why I and many others remain fiercely loyal to Detroit sports teams, including the historically hapless Lions. (I am utterly shocked that the amazingly successful Detroit Red Wings are planning on a new hockey arena with mostly public funding from the city. Are they serious?) Maybe we take it as a sign of character to stick with places like Flint and Detroit through thick-and-thin; it’s a part of the blue-collar ethic of the people, even if some of us have never worn a hardhat or carried a lunchbox to work.  On the other hand, those of us who now live someplace else may have less heart but more brain, so moral and intellectual virtue don’t always go together.

So what do our brains tell us about Detroit’s failure, now that it has declared bankruptcy? First and foremost, we see what happens why a city ties all fortunes to one industry. By betting on a labor-intensive auto industry, Detroit was rewarded with many high-paying, union-protected manufacturing jobs for a few generations, drawing people from all over the country. But as fuel prices rose as a result of the OPEC oil shocks in the 1970s and competition from Germany and Japan increased, the Big 3 of General Motors, Ford and Chrysler remained stagnant, with both management and the labor unions to blame for not adapting to shifting market conditions. Complacency equals defeat in a market economy, and there’s no way such economies grow without competition. While competition in the auto industry was a good thing for American consumers, it resulted in devastation for Detroit.

There are always winners and losers in a competition; long-term problems arise, however, when it’s clear why some keep losing but still refuse to change. Strong unions may have done a lot of good for working-class people who faced unscrupulous owners and dangerous working conditions; unions that use their strength and money to become political bullies are corrupting. Management didn’t help itself either, first by conceding too much to these same unions and also by seeking tax advantages and other political benefits to stay put, which Detroit and state of Michigan officials were only too happy to grant. The pro-union Democratic Party was especially eager to “help” and dominated local politics in Detroit for 60 years, effectively turning it into a one-party city. The result is what we now recognize as “crony capitalism” – big government, big business and big labor colluding to keep out competition. It may have worked for some time, but it eventually bred the very complacency that wrecked Detroit materially and spiritually.

This collusion between government, business and labor is sometimes praised a form of “solidarity” because it doesn’t throw society to the mercy of mysterious market forces, and there’s something to be said for wanting to maintain human agency instead of giving in to economic determinism. It’s the way the European social model has developed over the last century or so and has been promoted by Christian Democratic parties in places like Germany and Italy – “capitalism with a human face,” as it’s often called. Generous welfare programs are established, some of which explicitly seek to protect the family made up of a working husband and a wife who stays home and raises the children.

It all seems to make sense from a Christian social perspective and may work if we all lived in closed economies and shared many assumptions about society that no longer seem to hold. Closed economies restrict competition and hence innovate much less than open ones. The family model of a working husband and stay-at-home wife is often derided as patriarchical and unfair to women. And as economic historian Jerry Z. Mueller has argued, welfare systems seem to work best in relatively homogenous societies where citizens don’t mind supporting others like themselves out of the public purse. The more multicultural a society becomes, the harder it is to support such programs politically and socially, for better or worse motives. How many Christians or liberals do you know who are willing to accept the kinds of restrictions needed to make such a social model work?

The decline of Detroit cannot be discussed without mentioning the problem of race. Many African-Americans had moved to Detroit from the South in search of freedom and opportunity in the form of jobs in the auto industry. But the city never recovered from a violent 1967 riot, which caused many white residents to flee for the suburbs, leaving a poor urban underclass behind. Truth be told, Detroit was highly segregated prior to the riots, so it never quite achieved the racial harmony and equality that so many civil rights leaders had sought. The ’67 riot simply signaled the end of the dream in Detroit.

These are just a few of the many, now seemingly intractable, causes of Detroit’s decline. More hopeful people will ask what can be done, but I’m afraid the answer is: not very much. But at least as a way of gaining some intellectual clarity, we should look at what kind of choices cities like Detroit faced, which have only gained in importance since its heyday in the 1950s. Should a city become a “one-horse town” by enticing a large industry to provide high-paying, secure jobs for its people, or instead seek to encourage small- and medium-sized businesses to grow into larger ones without knowing which will succeed or fail? Should a city provide generous employment and welfare plans to its own people or seek to promote private-sector growth to attract outsiders with a leaner public-sector? And finally, should a city try to maintain a certain religious-ethnic heritage or open itself up to the dynamic vagaries of a more cosmopolitan society?

The above are choices that no single civic leader can or should make in a democracy, but ones that all citizens should debate either directly or through their representatives. (I realize it’s hard to pay attention to politics with so much good TV out there, but please….) From what I’ve said here and in other places, you can probably guess which direction I’d prefer. I’d still rather have an open, honest debate about it than simply complain about the consequences of the crony arrangements that ruined Detroit.

Kishore Jayabalan