Why Detroit died 2

Since we don’t expect to find much that is useful to us in Time magazine we seldom visit it. But when we went searching for good articles on the decline of Detroit, it was there that we found a quotable one.

Our search was prompted by tc, one of our readers (see comments on our post of November 21, 2009: Death city). Our thanks to tc.

The primary reason for the decline of Detroit was the decline of the US auto industry. This article by Daniel Okrent says so, and also talks about related contributory causes. We think it’s a good overview, and although we don’t like everything in it, particularly the ‘green’ opinions on its last page, we recommend it.

Here are the extracts:

Detroit fell victim not to one malign actor but to a whole cast of them. For more than two decades, the insensate auto companies and their union partners and the elected officials who served at their pleasure continued to gun their engines while foreign competitors siphoned away their market share. …

Detroit became a majority-black city, and in 1973 it elected its first black mayor. Coleman Young was a talented politician who spent much of his 20 years in office devoting his talents to the politics of revenge. He called himself the “MFIC” — the IC stood for “in charge,” the MF for exactly what you think. Young was at first fairly effective, when he wasn’t insulting suburban political leaders and alienating most of the city’s remaining white residents with a posture that could have been summed up in the phrase Now it’s our turn. But by his third term, Young was governing more by rhetoric than by action. These were the years of a local phenomenon known as Devil’s Night, a nihilistic orgy of arson that in one especially explosive year saw 800 houses burn to the ground in 72 hours. Violent crime soared under Young. The school system began to cave in on itself. When jobs disappeared with the small businesses boarding up their doors and abandoning the city, the mayor seemed to find it more useful to bid the business owners good riddance than to address the job losses. Detroit was dying, and its mayor chose to preside over the funeral rather than find a way to work with the suburban and state officials who now detested him every bit as much as he had demonized them.

When Young finally left office in 1993, he bragged that Detroit had achieved a “level of autonomy … that no other city can match.” He apparently didn’t care that it was the autonomy of a man in a rowboat, in the middle of the ocean, without oars.

But Young isn’t the only politician to blame. In 1956, when I was 8 years old, my Congressman was John D. Dingell. There are people in southeastern Michigan who are still represented by Dingell, the longest-serving member in the history of the House of Representatives. “The working men and women of Michigan and their families have always been Congressman Dingell’s top priority,” his website declares, and I suppose he thinks he has served them well — by resisting, in succession, tougher safety regulations, more-stringent mileage standards, relaxed trade restrictions and virtually any other measure that might have forced the American automobile industry to make cars that could stand up to foreign competition.

By so ably satisfying the wishes of the auto industry — by encouraging southeastern Michigan’s reliance on this single, lumbering mastodon — Dingell has in fact played a signal role in destroying Detroit. He was hardly alone; if you wanted to get elected in southeastern Michigan, you had to support the party line dictated by the Big Four — GM, Ford, Chrysler and their co-conspirator the United Auto Workers. Anything that might limit the industry’s income was bad for the auto industry, and anything bad for the auto industry was deemed dangerous to Detroit.

The UAW had once been the most visionary of American unions. As early as the 1940s, UAW president Walter Reuther was urging the auto companies to produce small, inexpensive cars for the average American. In 1947 and ’48 the union even offered to cut wages if the Big Three would reduce the price of their cars. But by the early 1980s, the UAW had entered into a nakedly self-interested pact with the auto companies. After the union’s president joined GM’s chief congressional lobbyist to defeat a tougher mileage standard in 1990, the lobbyist declared that “we would not have won without the UAW.” It was, he said, “one of the proudest days of my life.”

The union really can’t be blamed for pushing for fabulous wages and lush benefits for its members — that game required two players, and the automakers knew only how to say yes. But the union leadership’s fatal mistake was insisting that workers with comparable skills and comparable seniority be paid comparable wages, irrespective of who employed them. If a machinist at a prosperous GM deserved $25 an hour, so did a machinist who worked for a barely profitable Chrysler or for a just-holding-its-own supplier plant that made axles or wheels or windshield wipers.

This defiant inattention to market reality not only placed the less healthy firms in peril, but by pricing labor so uniformly high, it also closed off Detroit to any possible diversification of its industrial base. When the automakers’ inattention to engineering, style and quality caused them to crash into a wall of consumer indifference, there was no other industry that could step forward and employ workers who would have been thrilled to make even a fraction of what they once earned. Now nearly 1 in 3 Detroit residents is out of work — and not many of the unemployed have a prayer of finding a job anytime soon. …

Most particularly we urge our readers to follow the 2 links on the Time pages to the eloquent pictures of buildings abandoned and decayed. Once seen, they can haunt the imagination, not only as images of an historic industrial and human disaster, but as portents of what can befall a whole triumphant civilization when a few people who arrogantly believe they know best impose their vision on millions of other lives. The car industry managers were guilty, unwilling as they were to change and adapt, to make what consumers would buy. Union bosses were guilty, blindly demanding more than the industry could bear. Politicians were guilty, as our extracts demonstrate. And now another bunch are coming up to try and order our world to fit their hearts’ desire: the greens.

Posted under Commentary, Environmentalism, Industry, United States by Jillian Becker on Sunday, December 6, 2009

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This post has 2 comments.

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  • Bob Barrett

    Interesting article on Detroit

    I'm sure the Big Three could have been run more efficiently, and it's
    popular to say that the management was terrible, they built only big,
    expensive vehicles and would not build the small efficient cars that
    most people needed. They could not compete with Honda and Toyota
    in small cars because of one thing: unions.

    UAW was well entrenched before Honda and Toyota built plants in other
    states and did not have to pay union wages and benefits. There are nearly
    as many parts in a small car as in a large SUV that sells for three to ten times as much money. Nearly as many man-hours are involved in the assembly. There is more material in the large vehicle, but the same number of parts
    that have to be handled. The labor cost in small cars is almost as high as in the big ones.

    The Big Three could not compete in small cars that sell at small profit
    margins. They would lose money on every one of them. They made less
    profit on the big cars than Honda and Toyota, but at least they survived
    for a while.

    Bob Barrett

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