Amy Kerr Hardin: Corruption did not cause deindustrialization

Today Amy & I are talking about Detroit. Speculating a bit on how we got here and what’s next.

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Guest:

  • Amy Kerr Hardin

Here are Amy’s awesome notes:

DETROIT, BY THE NUMBERS:

Debt of about $17 to $20 billion (estimates vary depending on the source), with $10 billion owed to roughly 20,000 retirees, and of that, $5.7 is in healthcare benefits.

There are 78,000 abandoned buildings and 65,000 vacant lots.

One third of the city, that’s 40 square miles, is abandoned.

Only 8.7 percent of violent crimes are solved.

The police force has been cut by 40 percent since the year 2000.

Unemployment in the city has risen from 6 percent in 2000 to 18 percent currently, compared to the state average of 8.7 percent as found in the recent jobs report.

About 40 percent of the street lights don’t work.

66 percent of Detroit’s parks are closed.

Detroit has gone from the fourth largest city to the 18th, with around 700,000 residents, down from 1.85 million in the 1950s.

PUNDITS and POLITICIANS

Gov. Snyder told bond holders back in June of 2011 that bankruptcy wasn’t an option for the city. Today on Meet the Press, he explained his reversal to David Gregory saying that there are “no other viable options”.

The governor went on to say that he wants to focus on the citizens of Detroit, more accountability in government, and he gave assurances that he would not touch the already funded pension dollars, but left it clear that the unfunded obligations were in his mind fair game. Snyder did offer that he was “empathetic” with retirees. He made no mention of the $7 to $10 billion in debt to bond-holders and other creditors.

Snyder said that Detroit has seen some “outstanding things in the private sector” in terms of moving Detroit forward.
By contrast, former Gov. Jennifer Granholm made the observation that people across the country have conflated the auto bailout of $80 billion with a Detroit bailout, thinking the money somehow went to the city – a notion forwarded by President Obama referring to the bailout as a means to save Detroit. (Only one automaker, GM, maintains a downtown headquarters, and most auto plants are flung far and wide.)

She was adamant that “blight removal” is a myopic focus for revitalizing the city.
Granholm asserted that Detroit’s problems are the result of deindustrialization, with the city seeing a 90 percent drop in good paying jobs. She explained that there are approximately 50,000 communities across the nation similarly losing their manufacturing bases.

The former governor advocated for a strong federal manufacturing policy. Her argument makes good sense, considering the state-against-state fight for businesses to locate in them. Gov. Rick Perry has recently launched a TV/radio campaign targeting other states attempting to lure businesses to Texas with a corporate-friendly tax code.

In response to the oft heard argument that Detroit brought these problems on itself through cronyism and corruption, Marc Morial, President of the Urban League, emphasized that blaming the fiscal crisis on poor leadership completely misses the mark. He says that this is about both a racial and a class divide in America.

Gov. Snyder said he wants to focus on blight removal.

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