What Detroit's Demise Says About America

My ancestors helped build Detroit. The Fourniers were fur-trappers and farmers living hard by the Detroit River until the fledgling auto industry beckoned in the early 1900s with a better deal: $5 a day and a pension.

In the 1960s, my father opted out of the family business to be a police officer. He served Detroit for 25 years as part of the elite motorcycle unit that doubled as the riot squad. One of my earlier memories is of my parents, dressed in church clothes, leaving our house to attend the 1967 funeral of a riot cop.

Mom and dad raised four children at 15285 Coram in the city's northeast corner, the same block upon which they were raised. All this to say: I love my hometown. And I hate what Detroit's demise might bode for our country.

Wrenching economic change … income inequality ... political corruption … ineffective government … rigid institutions … chronic debt and racism -- these are the things that bankrupted Detroit, morally and fiscally, and they're an exaggerated reflection of the nation's challenges.

Economy: Detroit failed to adapt to the global economy and to diversify for the postindustrial era. "Sometimes the losers from economic change are individuals whose skills have become redundant; sometimes they're companies, serving a market niche that no longer exists; and sometimes they're whole cities that lose their place in the economic ecosystem," wrote economic columnist Paul Krugman in today's New York Times. Sometimes, the victims are whole countries, a fact that seems lost on Washington, where the leadership is polarized and smart ideas go to die.

Income inequality: The unemployment rate in Detroit is more than 18 percent. Per capita income is pathetically low, near $15,000. Life is much better for suburban residents. In Grosse Pointe, Mich., separated from Detroit by the aptly named Alter Road, the median family income is more than $100,000, and unemployment is not a problem.

Bad government:  "The city's operations have become dysfunctional and wasteful after years of budgetary restrictions, mismanagement, crippling operational practices and, in some cases, indifferences or corruption," Detroit's emergency manager Kevyn Orr wrote in May. "Outdated policies, work practices, procedures, and systems must be improved consistent with best practices of 21st-century government." It would not be a stretch to apply Orr's words to the federal government.

Broken promises: The group most at risk in Detroit's bankruptcy may be the city's 20,000 retirees (including my father and many friends and family members). Of Detroit's overall debt, about half represents pension and health benefits promised to retirees, according to The Washington Post. This is because city leaders borrowed against pension funds and mortgaged the future—not unlike what Washington's leadership is doing to Social Security and Medicare.

Rigid institutions: Government agencies, businesses, schools, churches, the media, and virtually every other city institution failed to help residents weather the tumult of the last four decades of the 20th century. In particular, big labor never managed a second act after anchoring the rise of the American middle class in Detroit. Union membership and influence has declined in Detroit and elsewhere, considered by many to be more of an obstacle than a solution.

Racial tensions: Racism and racial polarization have a long and an ugly history in Detroit. The 1967 riots caused many whites to leave the city. White flight increased in the 1970s, when school busing and a ban on real-estate "red lining" threatened the nasty traditions of segregation. Craven real estate agents hired black women to push baby strollers through white neighborhoods, then knocked on doors urging residents to sell "before it's too late."  

The fallout from George Zimmerman's trial struck a chord with this Detroit native, particularly President Obama's eloquent remarks about Trayvon Martin and black Americans. As a kid, I was told to lock my car doors in "black neighborhoods." The owner of Detroit store where I worked ordered me to follow young black men into the aisles "to keep an eye on them."

On race and other issues, Detroit should be a warning to the country. It was—and in many ways, still is—a great city, but poor leadership and an ambivalent citizenry allowed Detroit's problems to fester, grow, and eventually overwhelm it. A nation can make the same mistake.

Coincidentally, when Detroit declared bankruptcy, I was wrapping up a Michigan vacation. The highlight was my daughter's wedding. She lives and works in the city, and got married in a church not far from where the Fourniers once trapped beavers and farmed. Her family drove in from the suburbs to a city they had abandoned (and that had abandoned them). The wedding reception was at the Detroit Historical Museum, where the Fourniers danced to Motown music in the brick-and-cobblestone streets of "Old Detroit." We toasted the future.