Decline of Detroit
The city of Detroit, in the U.S. state of Michigan, has gone through a major economic and demographic decline in recent decades. The population of the city has fallen from a high of 1,850,000 in 1950 to 680,000 in 2015, kicking it off the top 20 of US cities by population for the first time since 1850. However, the city's combined statistical area has a population of 5,318,744 people, which currently ranks 12th in the United States. Local crime rates are among the highest in the United States (despite this, the overall crime rate in the city has seen a decline during the 21st century), and vast areas of the city are in a state of severe urban decay. In 2013, Detroit filed the largest municipal bankruptcy case in U.S. history, which it successfully exited on December 10, 2014. Poverty, crime, shootings, drugs and urban blight in Detroit are ongoing problems.
As of 2017[update] median household income is rising, criminal activity is decreasing by 5% annually as of 2017, and the city's blight removal project is making progress in ridding the city of all abandoned homes that cannot be rehabilitated.
Contributors to decline
Role of the automobile industry
Before the advent of the automobile, Detroit was a small, compact regional manufacturing center. In 1900, Detroit had a population of 285,000 people, making it the thirteenth-largest city in the U.S. Over the following decades, the growth of the automobile industry, including affiliated activities such as parts and tooling manufacturing, came to dwarf all other manufacturing in the city. The industry drew a million new residents to the city. At Ford Motor's iconic and enormous River Rouge plant alone, opened in 1927 in Detroit's neighbor Dearborn, there were over 90,000 workers. The shifting nature of the workforce stimulated by the rapid growth of the auto industry had an important impact on the city's future development. The new workers came from diverse and soon far-flung sources. Nearby Canada was important early on and many other workers came from eastern and southern Europe, a large portion of them being ethnic Italians, Hungarians, and Poles. An important attraction for these workers was that the new assembly line techniques required little prior training or education to get a job in the industry.
The breadth of sources for the growing demand for auto assembly workers, however, was sharply limited by the turmoil of World War I, and shortly thereafter by the restrictive U.S. Immigration Act of 1924, with its limited annual quotas for new immigrants. In response, the industry—with Ford in the forefront—turned in a significant way to hiring African-Americans, who were leaving the South in huge numbers in response to the combination of a post-war agricultural slump and continuing Jim Crow practices. At the same time large numbers of southern whites were hired, as well as large numbers of Mexicans, since immigration from most of the western hemisphere was not restricted at all by new immigration quotas. By 1930 Detroit's population had grown to nearly 1.6 million, and then to nearly 2 million by its peak shortly before 1950. A World War II boom in the manufacture of war materiel contributed to this growth surge. This population was, however, very spread out in comparison with other U.S. industrial cities. A variety of factors associated with the auto industry fed this trend. There was the large influx of workers. They earned comparatively high wages in the auto industry. The plants they worked at, belonging to various major and minor manufacturers, were spread around the city. The workers tended to live along extended bus and streetcar lines leading to their workplaces. The result of these influences, beginning already by the 1920s, was that many workers bought or built their own single-family or duplex homes. They did not tend to live in large apartment houses, as in New York, or in closely spaced row houses as in Philadelphia. After New Deal labor legislation, auto-union secured wages and benefits facilitated this willingness to take on the cost and risk of home ownership.
These decentralizing trends did not have equal effects on African-American residents of the city. They tended to have far less access to New Deal mortgage support programs such as Federal Housing Authority and Veterans Administration insured mortgages. African-American neighborhoods were viewed by lenders and the federal programs as riskier, resulting—in this period—in much lower rates of homeownership for African-Americans than other residents of the city.
In contrast, the auto industry also gave rise to a very large and well-compensated layer of managers and executives. There were also large numbers of attorneys, advertising executives, and other white-collar workers who supported the industry's managerial force. These white-collar workers already by the 1920s had begun to move to neighborhoods well removed from the industry's factories and the neighborhoods of their workers. This upper stratum moved to outlying neighborhoods, and further, to well-to-do suburbs such as Bloomfield Hills and Grosse Pointe. Oakland County, north of the city, became a popular place to live for executives in the industry. "By the second half of the twentieth century, it was one of the wealthiest counties in the United States, a place profoundly shaped by the concentration of auto-industry-derived wealth."
Public policy was automobile oriented. Funds were directed to the building of expressways for automobile traffic, to the detriment of public transit and the inner-city neighborhoods through which the expressways were cut to get to the auto factories and the downtown office buildings.
These processes, in which the growth of the auto industry had played such a large part, combined with racial segregation to give Detroit, by 1960, its particularly noteworthy character of a substantially African-American inner city surrounded by mainly white outer sections of the city and suburbs. By 1960 there were more whites living in the city's suburbs than the city itself. On the other hand, there were very few African-Americans in the suburbs. Real estate agents would not sell to them, and if African-Americans did try to move into suburbs there was "intense hostility and often violence" in reaction.
The auto industry too was decentralizing away from Detroit proper. This change was facilitated by the great concentration of automobile production into the hands of the "Big Three" of General Motors, Ford, and Chrysler. The Big Three were able to put nearly every smaller competitor automaker out of business. While this corporate concentration was taking place, the Big Three were shifting their production out of central Detroit. Between 1945 and 1957 the Big Three built 25 new manufacturing plants in the metropolitan area, not one of them in the city itself.
The number and character of these new, suburban auto factories was a harbinger of future trends detrimental to the economic health of Detroit. There was an interaction between factory decentralization and the nature of the industry's post-New Deal unionized labor force. Ford Motor was one of the first to undertake major decentralization, in reaction to labor developments. Ford's workers voted to join the UAW in 1941. This led Ford to be concerned about the vulnerability of its huge flagship Rouge River plant to labor unrest. The workers at this plant were "among the industry's most well-organized, racially and ethnically diverse, and militant." A strike at this key plant could bring the company's manufacturing operations as a whole to a halt. Ford therefore decentralized operations from this plant, to soften union power (and to introduce new technologies in new plants, and expand to new markets). Ford often built up parallel production facilities, making the same products, so that the effect of a strike at any one facility would be lessened. The results for the River Rouge plant are striking. From its peak labor force of 90,000 around 1930, the number of workers there declined to 30,000 by 1960 and only about 6,000 by 1990. This decline was mainly due to automation.
The spread of the auto industry outward from Detroit proper in the 1950s was the beginning of a process that extended much further afield. Auto plants and the parts suppliers associated with the industry were relocated to the southern U.S., and to Canada and Mexico. The major auto plants left in Detroit were closed down, and their workers increasingly left behind. When the auto industry's facilities moved out, there were dramatically adverse economic ripple effects on the city. The neighborhood businesses that had catered to auto workers shut down. This direct and indirect economic contraction caused the city to lose property taxes, wage taxes, and population (and thus consumer demand). The closed auto plants were also often abandoned in a period before strong environmental regulation, causing the sites to become so-called "brownfields," unattractive to potential replacement businesses because of the pollution hangover from decades of industrial production. The pattern of the deteriorating city by the mid-1960s was visibly associated with the largely departed auto industry. The neighborhoods with the most closed stores, vacant houses, and abandoned lots were in what had formerly been the most heavily populated parts of the city, adjacent to the now-closed older major auto plants.
By the 1970s and 1980s, the auto industry suffered setbacks that further impacted Detroit. The industry encountered the rise of OPEC and the resulting sharp increase in gasoline prices. It faced new and intense international competition, particularly from Italian, Japanese and German makers. Chrysler avoided bankruptcy in the late 1970s only with the aid of a federal bailout. GM and Ford also struggled financially. The industry fought to regain its competitive footing but did so in very substantial part by introducing cost-cutting techniques focused on automation and thus reduction of labor cost and the number of workers. It also relocated ever more of its manufacturing to lower-cost states in the U.S. and to low-income countries. Detroit's residents thus had access to fewer and fewer well-paying, secure auto manufacturing jobs.
The leadership of Detroit made little attempt to diversify the city's economy. Because the city had flourished in the heyday of the auto industry, local politicians made periodic attempts to stimulate a revival of the auto industry in the city. For example, in the 1980s the cities of Detroit and Hamtramck used the power of eminent domain to level part of what had been Poletown to make a parking lot for a new automobile factory. On that site, a new, low-rise suburban type Cadillac plant was built, with substantial government subsidies. The new Detroit/Hamtramck Assembly employs 1,600 workers. In the 1990s, the city subsidized the building of a new Chrysler plant on the city's east side, Jefferson North Assembly, which employs 4,600 people.[when?] These efforts, however, were an uphill struggle against overall trends in the industry. In 2009 Chrysler filed a Chapter 11 bankruptcy case, and survives in a partnership with Fiat of Italy. while GM filed for Chapter 11 bankruptcy on June 1, 2009, and survives as a much smaller company—smaller now than Japan's Toyota Motor Corporation. A little over two years after these major blows to the U.S. auto industry, the city itself went into Chapter 9 bankruptcy.
Geographic segregation by race
Detroit's legacy of discrimination in housing has stretched long and far. During the Roaring Twenties, African American neighborhoods in Detroit experienced a renaissance; one full of prosperity, livelihood, and industry within black communities. However, due to the economic hardships of manufacturing industries, these communities fell on hard times, and devolved into decrepit remnants of what they once were. These areas soon became overcrowded, underfunded, and mistreated. Moreover, the mass migration of hopeful blacks from the South into these neighborhoods exacerbated their problem with overpopulation. Given the lack of industry, terrible living conditions, and overpopulation, many black citizens sought a way out, but found it was not easy.
White Detroiters and some wealthier black communities used various methods to restrict the movement of black citizens into predominantly white neighborhoods. Real estate agents and white homeowners often used a tactic called redlining. The Home Owners Loan Corporation, which was charged with deciding which areas were suitable for housing loans, would mark black neighborhoods in red, flagging the area as unsuitable for federal loans and subsidies. This red-line prevented blacks from the ability to attain loans from banks to build new houses or make improvements on existing ones. This also contributed to the racial prejudice against blacks. Having a black resident in a white neighborhood greatly depreciated home values, further motivating white Detroiters to keep their neighborhoods segregated. There were no major alternate means of obtaining loans, and government and state loans were the only means of getting a new home. This red-line allowed whites to restrict the movement of blacks into white areas by eliminating their ability to obtain loans, thus maintaining segregated neighborhoods.
In addition to the already effective redlining, neighborhood associations would often mandate restrictive covenants onto their buildings in order to prevent black families from moving in. These covenants were sometimes explicitly discriminatory and took the form of; "people of color can't purchase this home," or only for the "caucasian race." However, after certain hallmark legal cases of discrimination in housing such as Shelley vs Kraemer deemed restrictive covenants unconstitutional, neighborhood associations had to change their practices. To circumvent political hurdles, covenants were often changed to restrict boarding or dividing houses into multiple family units. Because African-Americans could not get loans, splitting the house was one of only a few feasible options, and these covenants took it away.
The creation of New Deal programs during the 1930s, although unintentional, further restricted black agency and movement. It established a strong relationship between patriotism and homeownership. Working and middle class homeowners started to fiercely oppose integration and the construction of public housing. Real estate agents and homeowners believed that having affordable public housing and more black residents would force home values to depreciate. Many middle class homeowners were also upset by the fact that they were unable to get government loans and subsidies while so much money was being put into low-cost housing projects. This made them cling on to their homes even tighter.
Neighborhood associations and the ability of de facto discrimination to influence discriminatory policy curbed efforts to combat racism in housing and allowed whites to prevent integrated neighborhoods. Neighborhood associations hell-bent on preventing integrating housing elected officials who supported their anti-integration agendas. Moreover, already elected politicians were controlled by their anti-integration constituents regardless if the politicians were actually anti-housing or not. This can be seen in the election of Mayor Albert Cobo. Cobo, a staunch opponent of integrated housing, dismantled the Mayor's Interracial Committee, a large advocate group for housing equality, and took additional measures to disband organizations and government policies that would be beneficial to integrated housing. Cobo's regime demonstrated how de facto discrimination could influence de jure discrimination, and contribute to overall racism in housing.
The open housing movement
In 1948, Shelley v. Kraemer and three other United States Supreme Court cases established that state enforcement of racially restrictive covenants were unconstitutional. This decision revitalized the advocacy for integrated neighborhoods. Suburbs around Detroit expanded dramatically as wealthy African-Americans began to move into white neighborhoods. The singular asset that many white residents held after World War II was their home, and they feared that if Black people moved in, the value of their homes would plummet. This fear was preyed upon by blockbusting real estate agents who would manipulate Whites into selling their homes for cheap prices by convincing them that African-Americans were infiltrating the neighborhood. They would even send Black children to go door to door with pamphlets that read, "Now is the best time to sell your house—you know that." With the means to pick up and leave, many white residents fled to the surrounding suburbs. This "white flight" took much away from the city: residents, the middle class, and tax revenues which kept up public services such as schools, police, and parks. Blockbusting agents then profited by reselling these houses at incredibly marked-up prices to African-Americans desperate to get out of the inner city.
These inflated prices were only affordable by the black "elite." As wealthier black Detroiters moved into the previously white neighborhoods, they left behind low-income residents in the most inadequate houses at the highest rental. Redlining, restrictive covenants, local politics, and the open housing movement all contributed to the restricted movement of black, low-income Detroiters.
1950s job losses
In the postwar period, the city had lost nearly 150,000 jobs to the suburbs. Factors were a combination of changes in technology, increased automation, consolidation of the auto industry, taxation policies, the need for different kinds of manufacturing space, and the construction of the highway system that eased transportation for commuters. Major companies like Packard, Hudson, and Studebaker, as well as hundreds of smaller companies, declined significantly or went out of business entirely. In the 1950s, the unemployment rate hovered near 10 percent.
1950s to 1960s freeway construction
By the late 1940s, the economic wounds from years of redlining and restrictive covenants hurt the standard of living for many African Americans and minorities living in Detroit. With limited housing opportunities and sky-high rents, those living in "red" neighborhoods like Black Bottom and Paradise Valley often had little financial ability to pay for private apartments or even housing repairs. Consequences of close-quarter living were exacerbated by an influx of black immigrants during the Great Migration and World War II. The decaying neighborhoods also developed sanitation problems; garbage pickups were rare and trash littered the street, accelerating the spread of diseases and enticing pests. Perceptions of "urban blight" and a need for "slum clearance" in these areas were fueled especially by (majority white) Detroit city planners, who classified over two-thirds of housing in Paradise Valley as substandard.
A plan for "urban renewal" in Black Bottom and Paradise Valley neighborhoods was put forth by Detroit Mayor Edward Jeffries in 1944. Utilizing eminent domain laws, the government began taking down buildings in the Black Bottom neighborhood in 1949. The push for urban renewal in post-World War II Detroit was popularized by local government officials, in conjunction with real estate agents and bank owners of the time, who stood to gain from investment in new buildings and wealthier residents. When the 1956 Highway Act mandated new highways routed through Detroit, the Black Bottom and Paradise Valley areas were an ideal placement; deconstruction of the site had already been started, and the political clout of slum clearance was more powerful than the limited ability residents had to advocate against the placement.
Though it faced urban poverty and overcrowding, the Black Bottom neighborhoods were an exciting mix of culture and innovation, with the economic district boasting approximately 350 black-owned businesses. The downtown area is often described as if Motown music played even from the pipes in the street. But when highway projects were announced, sometimes years before construction started and sometimes warning only thirty days in advance, the property values for those who did own land disappeared. The forced relocation condemned many residents to even harsher poverty, and the local government commissions made few efforts to assist families in relocation. It was difficult enough for the thousands of persons displaced to find new housing in a time where restrictive covenants, even though technically outlawed in 1948, were deftly and covertly written into many of Detroit's surrounding neighborhoods. It was even harder for business owners to relocate their life's work. Lasting ramifications of the highway construction are still felt by the black business sector in Detroit today.
The Oakland-Hastings Freeway, now called the I-375 Chrysler Highway, was laid directly along Hastings Street at the heart of the Black Bottom business district, and cut through the Lower East Side and Paradise Valley as well. For the construction of the Edsel Ford Expressway (I-94) alone, 2,800 buildings from the West Side and northern Paradise Valley were demolished, including former jazz nightclubs, churches, community buildings, businesses and homes. The Lower West Side was mostly destroyed by the John C. Lodge Freeway, which also ran through black neighborhoods outside of Twelfth Street and Highland Park.
What was once a diverse, thriving home to thousands of people quickly became a monument to the misguided and racist views of the city officials and planners of Detroit at the time. The highways catalyzed the decline of Detroit. Although planners envisioned them as necessary for a grander future Detroit, even when they were constructed the size of the roads were superfluous and better fit for a city with twice the population of Detroit. It created a second housing crisis and further encouraged residents to move out of the city and commute downtown to work, both of which drained money from Detroit's inner city. The highways reinforced the Motor City as just that: a place rumbling with engines from nine to five, but quieter and more deserted than it ever had been when the work day ended.
A letter from a Mrs. Grace Black found in the Bentley Historical Library's historical archives illustrates the struggles of finding housing with children in the midst of highway construction:
Please consider a family of 6 who are desperately in need of a house to rent. Husband, wife, and four lonely children, who have been turned down because we have children. We are now living in a house of the Edsel Ford Express Highway. We have our notice to move on out before the 23rd of Oct. So far we haven't found a place to move. Nobody want to rent us because we have children. My children aren't destructive but nobody will give us a chance to find out if they are or not. We are so comfortable here. It's the first freedom we've enjoyed since we've had children. My husband work at children's hospital only mak $60 a week. Sixty dollars we are paying $50 a month which we don't mind because we are comfortable. This will be demolished if we were able we would buy this house. But are not. So if anything you can do will be appreciated from the depths of our hearts. You have done so much to help the lower income families. We are deeply grateful wishing you God's speed. This is urgent! Please give this your immediate consideration.
Mrs. Grace Black (a worried mother)
I-75, Ford Field, and Comerica Park now occupy most of the area where Paradise Valley once stood. Historian Thomas Sugrue notes that of the families displaced by the razing of the Paradise Valley neighborhood:
[A]bout one-third of the Gratiot-area's families eventually moved to public housing, but 35 percent of the families in the area could not be traced. The best-informed city officials believed that a majority of families moved to neighborhoods within a mile of the Gratiot site, crowding into an already decaying part of the city, and finding houses scarcely better and often more overcrowded than that which they had left.
The Detroit Race Riot of 1943 broke out in Detroit in June of that year and lasted for three days before Federal troops regained control. The rioting between blacks and whites began on Belle Isle on June 20, 1943, and continued until June 22, killing 34, wounding 433, and destroying property valued at $2 million.
The summer of 1967 saw five days of riots in Detroit. Over the period of five days, forty-three people died, of whom 33 were black and 10 white. There were 467 injured: 182 civilians, 167 Detroit police officers, 83 Detroit firefighters, 17 National Guard troops, 16 State Police officers, and three U.S. Army soldiers. In the riots, 2,509 stores were looted or burned, 388 families were rendered homeless or displaced, and 412 buildings were burned or damaged enough to be demolished. Dollar losses from arson and looting ranged from $40 million to $80 million.
After the riots, thousands of small businesses closed permanently or relocated to safer neighborhoods, and the affected district lay in ruins for decades.
Of the 1967 riots, politician Coleman Young, Detroit's first black mayor, wrote in 1994:
"The heaviest casualty, however, was the city. Detroit's losses went a hell of a lot deeper than the immediate toll of lives and buildings. The riot put Detroit on the fast track to economic desolation, mugging the city and making off with incalculable value in jobs, earnings taxes, corporate taxes, retail dollars, sales taxes, mortgages, interest, property taxes, development dollars, investment dollars, tourism dollars, and plain damn money. The money was carried out in the pockets of the businesses and the people who fled as fast as they could. The white exodus from Detroit had been prodigiously steady prior to the riot, totally twenty-two thousand in 1966, but afterward, it was frantic. In 1967, with less than half the year remaining after the summer explosion, the outward population migration reached sixty-seven thousand. In 1968 the figure hit eighty-thousand, followed by forty-six thousand in 1969."
According to the economist Thomas Sowell:
Before the ghetto riot of 1967, Detroit's black population had the highest rate of home-ownership of any black urban population in the country, and their unemployment rate was just 3.4 percent. It was not despairing that fueled the riot. It was the riot which marked the beginning of the decline of Detroit to its current state of despair. Detroit's population today is only half of what it once was, and its most productive people have been the ones who fled.
Economist Edward L. Glaeser believes the riots were a symptom of the city's already downward trajectory:
While the 1967 riots are seen as a turning point in the city’s fortunes, Detroit’s decline began in the 1950s, during which the city lost almost a tenth of its population. Powerful historical forces buffeted Detroit’s single-industry economy, and Detroit’s federally supported comeback strategies did little to help.
State and local governments responded to the riot with a dramatic increase in minority hiring, including the State Police hiring blacks for the first time, and Detroit more than doubling the number of black police. The Michigan government used its reviews of contracts issued by the state to secure an increase in nonwhite employment. Between August 1967 and the end of the 1969-1970 fiscal year, minority group employment by the contracted companies increased by 21.1 percent.
In the aftermath of the riot, the Greater Detroit Board of Commerce launched a campaign to find jobs for ten thousand "previously unemployable" persons, a preponderant number of whom were black. By Oct 12, 1967, Detroit firms had reportedly hired about five thousand African-Americans since the beginning of the jobs campaign. According to Sidney Fine, "that figure may be an underestimate."
The Michigan Historical Review writes that "Just as the riots following the assassination of Martin Luther King Jr. facilitated the passage of the federal Civil Rights Act of 1968, which included fair housing, so the Detroit riot of July 1967, 'the worst racial disturbance' of the century to that time, provided the impetus for the passage of Michigan’s fair housing law as well as similar measures in many Michigan communities." Other laws passed in response to the disorder included "important relocation, tenants’ rights, and code enforcement legislation." Such proposals had been made by Governor Romney throughout the 1960s, but the opposition did not collapse until after the riot.
1970s and 1980s
The 1970 census showed that white people still made up a majority of Detroit's population. However, by the 1980 census, white people had fled at such a large rate that the city had gone from 55 percent to 34 percent white within in a decade. The decline was even starker than this suggests, considering that when Detroit's population reached its all-time high in 1950, the city was 83 percent white.
Economist Walter E. Williams writes that the decline was sparked by the policies of Mayor Young, who Williams claims discriminated against whites. By contrast, urban affairs experts largely blame federal court decisions which decided against NAACP lawsuits and refused to challenge the legacy of housing and school segregation – particularly the case of Milliken v. Bradley, which was appealed up to the Supreme Court.
The District Court in Milliken had originally ruled that it was necessary to actively desegregate both Detroit and its suburban communities in one comprehensive program. The city was ordered to submit a "metropolitan" plan that would eventually encompass a total of fifty-four separate school districts, busing Detroit children to suburban schools and suburban children into Detroit. The Supreme Court reversed this in 1974. In his dissent, Justice William O. Douglas' argued that the majority's decision perpetuated "restrictive covenants" that "maintained...black ghettos." 
Gary Orfield and Susan E. Eaton wrote that the "Suburbs were protected from desegregation by the courts, ignoring the origin of their racially segregated housing patterns." John Mogk, an expert in urban planning at Wayne State University in Detroit, has said that "Everybody thinks that it was the riots [in 1967] that caused the white families to leave. Some people were leaving at that time but, really, it was after Milliken that you saw a mass flight to the suburbs. If the case had gone the other way, it is likely that Detroit would not have experienced the steep decline in its tax base that has occurred since then." Myron Orfield, director of the Institute on Metropolitan Opportunity at the University of Minnesota, has said:
Milliken was perhaps the greatest missed opportunity of that period. Had that gone the other way, it would have opened the door to fixing nearly all of Detroit's current problems... A deeply segregated city is kind of a hopeless problem. It becomes more and more troubled and there are fewer and fewer solutions.
The departure of middle-class whites left blacks in control of a city suffering from an inadequate tax base, too few jobs, and swollen welfare rolls. According to Chafets, "Among the nation’s major cities, Detroit was at or near the top of unemployment, poverty per capita, and infant mortality throughout the 1980s."
Detroit became notorious for violent crime in the 1970s and 1980s. Dozens of violent black street gangs gained control of the city's large drug trade, which began with the heroin epidemic of the 1970s and grew into the larger crack cocaine epidemic of the 1980s and early 1990s. There were numerous major criminal gangs that were founded in Detroit and that dominated the drug trade at various times, though most were short-lived. They included The Errol Flynns (east side), Nasty Flynns (later the NF Bangers) and Black Killers and the drug consortiums of the 1980s such as Young Boys Inc., Pony Down, Best Friends, Black Mafia Family and the Chambers Brothers. The Young Boys were innovative, opening franchises in other cities, using youth too young to be prosecuted, promoting brand names, and unleashing extreme brutality to frighten away rivals.
Several times during the 1970s and 1980s, Detroit was named the "arson capital of America", and the city was also repeatedly dubbed the "murder capital of America". Detroit was frequently listed by FBI crime statistics as the "most dangerous city in America" during this time frame. Crime rates in Detroit peaked in 1991, at more than 2,700 violent crimes per 100,000 people. Population decline left abandoned buildings behind that became magnets for the drug trade, arson, and other criminal activity. The city's criminality has pushed tourism away from the city, and several foreign countries even issued travel warnings for the city.
Around this period, in the days of the year preceding and including Halloween, Detroit citizens went on a rampage called "Devil's Night". A tradition of light-hearted minor vandalism, such as soaping windows, had emerged in the 1930s, but by the 1980s it had become, said Mayor Young, "a vision from hell." During the height of the drug era, Detroit residents routinely set fire to houses that were known as popular drug-dealing locations, accusing the city's police of being either unwilling or unable to solve the deep problems of the city.
The arson primarily took place in the inner city, but surrounding suburbs were often affected as well. The crimes became increasingly destructive throughout this period. Over 800 fires were set, mostly to vacant houses, in the peak year 1984, overwhelming the city's fire department. In later years, the arsons continued, but the frequency of these fires was reduced by razing thousands of abandoned houses, buildings that were, in many cases, used to sell drugs. 5,000 of these buildings were razed in 1989–90 alone. Every year the city mobilizes "Angel's Night," with tens of thousands of volunteers patrolling high-risk areas in the city.
A significant percentage of housing parcels in the city are vacant, with abandoned lots making up more than half of total residential lots in large portions of the city. With at least 70,000 abandoned buildings, 31,000 empty houses, and 90,000 vacant lots, Detroit has become notorious for its urban blight.
In 2010, Mayor Bing put forth a plan to bulldoze one fourth of the city. The plan was to concentrate Detroit's remaining population into certain areas to improve the delivery of essential city services, which the city has had significant difficulty providing (policing, fire protection, trash removal, snow removal, lighting, etc.). In February 2013 the Detroit Free Press reported the Mayor's plan to accelerate the program. The project has hopes "for federal funding to replicate it [the bulldozing plan] across the city to tackle Detroit’s problems with tens of thousands of abandoned and blighted homes and buildings." Bing said the project aims "to right-size the city’s resources to reflect its smaller population."
The average price of homes sold in Detroit in 2012 was $7,500. As of January 2013[update], 47 houses in Detroit were listed for $500 or less, with five properties listed for $1. Despite the extremely low price of Detroit properties, most of the properties have been on the market for more than a year as the boarded up, abandoned houses of the city are seldom attractive to buyers. The Detroit News reported that more than half of Detroit property owners did not pay taxes in 2012, at a loss to the city of $131 million (equal to 12% of the city's general fund budget).
The first comprehensive analysis of the city's tens of thousands of abandoned and dilapidated buildings took place in the spring of 2014. It found that around 50,000 of the city's 261,000 structures were abandoned, with over 9,000 structures bearing fire damage. It further recommended the demolition of 5,000 of these structures.
Long a major population center, Detroit has been going through a considerable reduction in population; the city has lost over 60% of its population since 1950. Detroit reached its population peak in the 1950 census at over 1.8 million people, and decreased in population with each subsequent census; as of the 2010 census, the city has just over 700,000 residents, adding up to a total loss of 61% of the population.
The vast majority of this population loss was due to the deindustrialization of Detroit that moved factories to the suburbs along with the phenomenon called white flight, resulting in the movement of many white families to the suburbs. This movement was a result of both an increased desire for homeownership and upholding the racial “purity” of white neighborhoods.
As a result, a significant change in the racial composition of the city occurred over that same period; from 1950 to 2010, the black/white percentage of population went from 16.2%/83.6% to 82.7%/10.6%. Approximately 1,400,000 of the 1,600,000 white people in Detroit after World War II have left the city, with many going to the suburbs. Beginning in the 1980s, for the first time in its history, Detroit was a majority black city.
This drastic racial demographic change resulted in much more than a change in neighborhood appearance. It had political, social, end economic effects as well. In 1974, Detroit elected its first black mayor, Coleman Young. Coleman Young aimed to create a racially diverse cabinet and police force, half black and half white members, leading to a new face representing Detroit on the global stage.
Most importantly, however, was the negative effect on the economy. Following the decline in population, Detroit's tax revenue took a significant hit. The government was receiving less revenue, leading to foreclosure and unemployment, eventually culminating in the bankruptcy of 2013.
Detroit's population is still declining today, largely due to its majority poor, black demographic. Because urban renewal, highway construction, and discriminatory loan policies contributed to white flight to the suburbs, the remaining poor, black city population resulted in a loss of revenue. Furthermore, Detroit has the highest property tax of any major U.S. city, which makes it difficult for many families to live in the city. Seemingly contradictory are the extremely poor services the city has. Dilapidated schools, lack of safety, blighted properties, and waste contribute to the lack of families living in the city today.
However, data does show that Detroit's population loss is slowing. The decrease in 2017 was 2,376 residents compared to the 2016 decline of 2,770. The city has yet to rebound to see population growth, but the decline is indeed slowing.
According to the U.S. Department of Labor Bureau of Labor Statistics, the unemployment rate is at 8.4%, as of October 2017[update]. In the 20th Century, the unemployment rate was around 5% according to the U.S. Department of Labor's archives.
The U.S.A. Census Bureau's Statistical Abstract of the United States: 2012 ranks Detroit first among all 71 U.S. cities for which rates were calculated in percentage of the city's population living below the poverty level. The individual rate living below the poverty level is 36.4%; the family rate is 31.3%.
Detroit has some of the highest crime rates in the United States, with a rate of 62.18 per 1,000 residents for property crimes, and 16.73 per 1,000 for violent crimes (compared to national figures of 32 per 1,000 for property crimes and 5 per 1,000 for violent crime in 2008). Detroit's murder rate was 53 per 100,000 in 2012, ten times that of New York City. A 2012 Forbes report named Detroit as the most dangerous city in the United States for the fourth year in a row. It cited FBI survey data that found that the city's metropolitan area had a significant rate of violent crimes: murder and non-negligent manslaughter, rape, robbery, and aggravated assault.
On March 1, 2013, Governor Rick Snyder announced that the state would be assuming financial control of the city. A team was chosen to review the city's finances and determine whether the appointment of an emergency manager was warranted. Two weeks later, the state's Local Emergency Financial Assistance Loan Board (ELB) appointed an emergency financial manager, Kevyn Orr. Orr released his first report in mid-May. The results were generally negative regarding Detroit's financial health. The report said that Detroit is "clearly insolvent on a cash flow basis." The report said that Detroit would finish its current budget year with a $162 million cash-flow shortfall and that the projected budget deficit was expected to reach $386 million in less than two months. The report said that costs for retiree benefits were eating up a third of Detroit's budget and that public services were suffering as Detroit's revenues and population shrink each year. The report was not intended to offer a complete blueprint for Orr's plans for fixing the crisis; more details about those plans were expected to emerge within a few months.
After several months of negotiations, Orr was ultimately unable to come to a deal with Detroit's creditors, unions, and pension boards and therefore filed for Chapter 9 bankruptcy protection in the Eastern District of Michigan U.S. Bankruptcy Court on July 18, 2013, the largest U.S. city ever to do so, with outstanding financial obligations to more than 100,000 creditors totaling approximately $18.5 billion. On December 10, 2014, Detroit successfully exited bankruptcy.
By the late 2010s, many observers pointed to an economic and cultural resurgence of Detroit, including The New York Times. Detroit is serving for a model for other areas to learn how to re-energize their urban centers.
Evidence of Detroit's resurgence is most readily found in the Midtown Area and the Central Business District, which have attracted a number of high-profile investors. Most notably, Dan Gilbert has heavily invested in the acquisition and revitalization of a number of historic buildings in the Downtown area. A primary focus of private real estate investment has been to position Detroit's Central Business District as an attractive site for the investment of technology companies. Approaches to the private investment of Midtown, however, have prioritized re-establishing Midtown as the cultural and commercial center of the city. Public transportation within the Downtown area has also been a target for private investors, as evidenced by Quicken Loans' investment in Detroit's QLine railcar, which currently runs a 3.3 miles (5.3 km) track along Woodward Avenue.
However, the approach taken by many private investors in the downtown area has been met with several criticisms. Many have argued that the influx of private capital into the Downtown area has resulted in dramatic changes to the social and socio-economic character of the city. Residents have cited fears of physical displacement due to the increase in rent that results from such investments. Additionally, many long-time residents fear that the influx of new capital could result in their political disempowerment; they fear that the city government will become less responsive to their needs if the city government is under the influence of outside investors.
Other investors, such as John Hantz, are attempting to revitalize Detroit using through another approach: urban agriculture. Unlike Gilbert, Hantz has turned his focus to the blighted neighborhoods in Detroit's residential zones. In 2008, Hantz approached Detroit's city government to propose a plan to remove urban blight by demolishing blighted homes and planting trees to establish a large urban farm. Despite fervent criticisms on behalf of city residents claiming that Hantz's proposal amounted to nothing more than a "land grab," the city government eventually approved Hantz's proposal, granting him nearly 140 acres (57 ha) of land. As of 2017, Hantz farms has planted over 24,000 saplings and demolished 62 blighted structures. Still, it remains uncertain what Hantz's long-term ambitions are for the project, and many residents speculate future developments on his land.
Detroit's resurgence is also being driven by the formation of public-private-nonprofit partnerships that protect and maintain Detroit's most valuable assets. The Detroit Riverfront, for instance, is maintained and developed almost exclusively through non-profit funding in partnership with public and private enterprises. This model for economic development and revitalization has seen enormous success in Detroit, with the Detroit Riverfront Conservancy raising in excess of $23 million to revitalize and maintain riverfront assets. This model for economic development is so promising that the city has turned to similar partnership strategies to manage, maintain, and revitalize a number of other city assets.
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