29 September 2014

White flight, corporate flight . . .

I grew up just outside Detroit and have felt an ache in my heart for this bleeding city for so many years now. It’s long been one of the country’s designated loser cities, beginning in the 1960s, when change hit it hard. The phrase at the time was “urban blight,” a social cancer with unexamined causes that, in the ensuing years, has gotten progressively worse.

A year ago this week, the city, which is predominantly African-American, lost its self-governance when the Republican governor of Michigan appointed an emergency financial manager, an overboss with powers superseding that of all elected officials — including the ability to rewrite laws, break contracts, privatize services and much more — on the premise that only an autocrat could straighten out the city’s disastrous finances. Four months later, Detroit made headlines as the largest city to file for Chapter 9 bankruptcy, but of course it wasn’t “the city” that did so; it was the emergency manager.

The city, in all its soul and complexity, had been reduced to a single voice: the voice of austerity and, of course, corporate interests.

“If the city filed for bankruptcy, and was arguing in its own interest,” activist Detroit pastor Bill Wylie-Kellermann wrote recently in The Catholic Worker, “the banks and the pensioners and the unions, would all be on a level playing field. Instead the banks have been dealt with up front, offered 80 cents on the dollar. The city pensioners were offered 10 cents.”

This isn’t about responsible financial management. It’s about powerful interests gaming the global economy in new ways. The takeover of cities like Detroit — struggling cities, abandoned by industry, capital and the moneyed classes — is a power grab by the very forces that began abandoning them half a century ago.

Wylie-Kellermann writes: “When one of the Detroit dailies” — the Detroit News — “publishes an editorial entitled, ‘Can Detroit Govern Itself?’ decoding the subtext is simple: ‘Can black people rule themselves?’ White folks outstate shake their heads and shrug indifference. Problem is, once the mechanisms are perfected and the precedents are set, emergency management will be coming to a white city near you.”

And Frank Joyce, a Detroit labor and political analyst and writer, in a brilliant analysis of the situation that ran last September at AlterNet, noted: “Much of the Detroit punditry one reads or hears conveniently ignores race altogether, concentrating instead on the decline of the domestic auto industry or macroeconomic trends. Usually when race is included on a list of ‘causes for Detroit’s decline,’ it is described with weasel words such as ‘racial tensions’ or ‘the racial divide.’ Nonsense. What it was and what it remains, is white racism pure and simple. Bloviators love to talk about the ‘unsustainable legacy’ costs of pensions for city workers. They never talk about the ‘legacy’ costs of racism.”

The legacy of racism has contributed to Detroit’s current dilemma in an immediate and direct way, as Joyce points out, first, through good, old-fashioned housing discrimination, which confined black renters and home buyers to specific neighborhoods and, ultimately, to the city itself, creating a ring of white suburbs around the central city that began draining the city’s tax base over the course of several decades.

“And just to add insult to injury,” Joyce writes, “the financial institutions that wouldn’t lend money to African Americans to move out of the city wouldn’t lend it for home improvement in the city either. But they would charge more, far more, for home and car insurance. For those too young to remember, that practice was called redlining. It’s still prevalent today.”

As far as I’m concerned, such factors far outweigh the corruption scandals that plagued Detroit in recent years, landing one recent mayor, Kwame Kilpatrick, in prison. The city’s troubles go much deeper.

Detroit and other industrial cities that lacked a cultural pull stronger than the racism that was tearing them apart were simply too easy to abandon. Detroit also lacked a diversity of industry, so when the automakers fled elsewhere, the city was left struggling for a tax base — and was getting no outside help, such as from the state of Michigan, which slashed its revenue-sharing program with municipalities. This cost Detroit some $67 million in recent years, explained economist Wallace Turbeville, writing at Demos.

“By cutting revenue sharing with the city,” he wrote, “the state effectively reduced its own budget challenges on the backs of the taxpayers of Detroit (and other cities). These cuts account for nearly a third of the city’s revenue losses between FY 2011 and FY 2013, coming on the heels of the revenue losses from the Great Recession and tipping the city into the cash flow crisis that it is now experiencing. Furthermore, the legislature placed strict limits on the city’s ability to raise revenue itself to offset these losses.”

Detroit, poster city of abandonment, canary in a coalmine: “Whatever the ultimate outcome of Detroit’s municipal bankruptcy drama, we can be certain of one thing,” Joyce wrote. “It won’t fix any of the underlying problems of systemic racial, political and economic dysfunction.”

Joyce believes a new economy is growing out of the city’s ruins — an economy rooted in values deeper than money. Of this much I’m certain: The city’s healing lies beyond the narrow, self-interested logic and “emergency management” capabilities of capitalism.


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Robert Koehler is an award-winning, Chicago-based journalist and nationally syndicated writer. His new book, Courage Grows Strong at the Wound (Xenos Press) is now available. Contact him at Bob Koehler, visit his website at Common Wonders or listen to him at Voices of Peace radio.

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