Detroit has Died, but it hasn't fallen over yet

[Racerbvd]

Originally Posted by wcc

Hugh you go from one fire to the next. You sure you aren't a fire fighter?

50s that's nothing. Wait around for winter to set in... lol

Or an Arsonist

Originally Posted by johnsjmc
How was it allowed to become so bad?

That is what happens when you let unions & liberals run things...

Like 3 or foe welfare offices mixed into one

[johnsjmc]

How was it allowed to become so bad?
Maybe when times are good is when Infrastructure rebuilding should have been done ?

[Hugh R]

Not infrastructure, loss of car building jobs.

[john70t]

Car plants can be turned into plane/other manufacturing plants in a jiffy(i.e. WW2).

They can even be turned into car battery plants for Chevy Volt Automobiles, if those batteries were not bought and shipped here from Korea.

Having the domestic mass-manufacturing capacity to produce electric car-sized batteries would, of course, allow for expansion of those vehicle types and make renewable energy systems cheaper...
...thus reducing our dependancy on foreign oil producing nations related to terrorism....
...which justified warentless surveilance of the american public...
...which incidentally is similar to the ONSTAR's(tm) remote door unlocking/remote shutdown/GPS tracking/Bluetooth intercepting/microphone enabling features which come with every new General Motors vehicle.

[Hugh R]

K???

[strupgolf]

I, for one, feel very sad for the people that have to live there. Imagine waking up each day with nothing to look forward to, nothing to hope for, and no one to help you make it better. Those scenes, in ones minds, were from much better times in a place that was very alive, very vibrant not so long ago. This is what's happening all over our country in every large city and every small town. I don't know how to change it, but hopefully this town and every town will see the light and bear down with some grit and say, "that was then, and this is now".

[Hugh R]

I agree, its very sad. Can you imagine joining the UAW 30 years ago at 21 y/o's buying a house paying a mortgage and 30 years later it's worth nothing. Your principle and interest are now completely gone.

[Groesbeck Hurricane]

America has stopped much of the manufacturing we used to do.

America has stopped making much of the equipment used to manufacture items.

America is stopping making the equipment that makes the equipment used to manufacture items.

America is quickly training others how to manufacture. Once they learn how, they will innovate and will no longer need our assistance to learn what we ourselves are unable to do. That service industry will also start a quick decline.

What made us great was the ability to make things, to innovate, and to have a strong middle class. In Detroit I see what could become of the rest of the country. The workers took everything they could, produced sub-par products, and saw production shift elsewhere. Service industries moved on. Nothing to fund infrastructure and a corrupt powerbase in office. Take a good look at the city. My biggest fear is Detroit is a precursur of things to come for the rest of us if we do not change the direction of this country.

[johnsjmc]

The cause (s) and result (s) are increasingly visable but what can be done to reverse the decline. When I see the mansion you can buy in the inner city for less than $50K I think I would like to move there .Then I think about gangs,methamphetamine labs and gun violence etc etc etc and I give my head a shake.

[jyl]

The city is 2-3X too large for its current population. Detroit could take over whole neighborhoods where the housing is basically intact but largely vacant, using eminent domain. Facelift them and be the only city in the US where you can buy an urban house/townhouse for $15K. With the cost of housing essentially zero, the cost of living would be extremely low and hence the cost of labor could be similarly low. With plenty of cheap commercial and industrial property, centrally located, solid infrastructure and reliable power, Detroit could be the least expensive place in the country to run a business. Telco/data centers, tech support/call centers, light manufacturing, apparel, distribution/logistics, businesses that are essentially exporters and don't depend on a local consumer base. Bulldoze blighted neighborhoods into urban organic farms, community sports fields, skate parks, and other "quality of life" public spaces. Vibrant, cool spots spring up as entrepreneurs are attracted by the low start-up costs and the residents who have decent spending power after their $150/month mortgage payments. The city could be re-born, not overnight, but look at other East Coast cities - many of them went from nastiness (NYC in the '70s?) to revitalization over a couple of decades.

[johnsjmc]

Canada struggles with the foreign ownership of all our resources and manufacturing. BIG brother lives next door. Many/most of our factories are subsidiaries of US companies. We have benefited from that arrangement. We do however have a higher cost of living. We pay higher taxes and have higher prices on most goods when compared to the States. We do have some benefits from our higher taxes ie universal health care.
I,m sure the cost of living is rapidly rising in China right now. We worry that our manufacturing will go to Mexico and Mexico worries theirs will go offshore to "Cheena".
Back to Detroit .The factories that were there made lots of people rich and lots of workers benefited with high paying jobs. What happened to that money? It wasn,t spent on or in Detroit.
I completly agree with the above post by "jyl". The upside potential of Destroit is very good.
How do you finance such a renewal?

[johnsjmc]

How do you take over a city in such decline. Grandma lives in the house which was bought and paid for with Grandpa,s wages from 40 years on an assembly line. The family home is now the only one still occupied in a city block. It,s worth no more than $5000 . What do you do with the displaced owner who now has next to nothing?

[Scuba Steve]

It probably has to start locally - by replacing the politicians, laws and policies that oversaw the city's demise.

[carreradpt]

I read an article some time ago that said that the city will not sell those vacant properties unless the buyer pays all liens, OD taxes etc. That could be a hefty amount. People are not willing to pay those so the property sits. They are stifling the market for money up front. Seems kind of rediculous to me.

[jyl]

Originally Posted by johnsjmc

How do you take over a city in such decline. Grandma lives in the house which was bought and paid for with Grandpa,s wages from 40 years on an assembly line. The family home is now the only one still occupied in a city block. It,s worth no more than $5000 . What do you do with the displaced owner who now has next to nothing?

If the neighborhood will stay housing, let them keep living there, sell the house back to them for 1c after redevelopment.

If the neighborhood will be bulldozed, give them $5K and a different house.

[jyl]

I don't know if Detroit is where it is because of local political/regulatory decisions, or because its #1 industry has lost huge share to competitors who make their cars in other states. Maybe both. Regardless, bold local leadership will be needed for a recovery to start, and it probably isn't the existing local leaders.

[Porsche-O-Phile]

Detroit's plight only underscores what happens when government tries to "social engineer" prosperity for a population of people who actually do not produce anything even close to what they cost.

You're seeing this on a far larger scale (though not as dramatic, because it's spread out all over the country) with residential contractors and subcontractors.

Our economy can only support so many guys toting nail guns making $100k a year in the same way it can only support so many UAW guys making $100k a year plus benefits.

We need workforce retraining and our post-secondary "education" system is woefully unprepared to offer it, having gotten out of the business of trade education (and into the business of liberal indoctrination) decades ago.

Makes it tough on those who've seen their jobs replaced by robotics or by those in cheaper labor markets if all you know how to do is turn screws or swing hammers. Even tougher on those who were (knowingly) overcompensated for said screw-turning or hammer-swinging, thought that the days of "easy money" would never end (thanks to the protections of either unions or government prop-ups of their industries) and therefore never saw the need to bother learning anything else.

[johnsjmc]

What is "the buisness of liberal indoctrination" a euphemism for? I,m guessing a school teacher?

[Porsche-O-Phile]

It refers to the current state of our schools where kids are taught that the Pledge of Allegance is wrong, it's not politically correct to refer to the writers of the Constitution as "Founding Fathers" and where it's more important to value feelings than performance. Simultaneously it's okay to pass out rubbers to fifth graders and send kids home from school for wearing t-shirts with the American flag on them because it might offend Mexicans.

All the above examples are real and recent, BTW.

[jyl]

Thought this might stimulate some discussion - here is a quick and dirty estimate of job recovery in the US auto industry over the next 5 years.



My q&d look suggests that, in the next 5 years, auto sales in the US will return to the replacement rate, which I believe is around 14MM units/year (based on number of drivers, age of existing vehicle fleet, useful life of vehicles, and number of vehicles per driver, the last I assume falls to the level of the early 1990s). Assuming the ratio of imported vehicles to domestically-produced vehicles is constant - Asian and European models produced in the US are counted as domestically-produced. Also assuming the industry's efficiency remains far higher than historical levels, but down a bit from current very high levels - most companies in the industry have cut employees so hard that their next move will be to add some back, although they are delaying it as long as they can.

This suggests the US auto manufacturing industry could add back about 210,000 jobs in the next five years. That's the Detroit OEMs like Ford and GM, the foreign transplants like Kia and Toyota and Honda, and the components industry like Magna, Lear, Borg-Warner, etc - note the components industry employs far more people than the OEMs. Which will still leave the industry well below peak employment levels of 2000, makes sense considering auto sales are assumed to be well below the record 17MM+ units of 2000.

This also suggests that the US auto manufacturing industry could hold on to much of the remarkable profit improvement it has achieved in the past couple of years. Many companies in the industry are making more profit and margin now than in 2000, despite units and revenues well below 2000 levels.

Truly, it is a good time to be Capital, in large part because it is a crappy time to be Labor. For the larger, more competitive companies in this country, profits are flowing at record or near-record levels.