21 November 2009

Detroit ... You're Killing Me



I heard a reporter on the radio recently tell of some truly shocking news about Detroit and its housing market. I've traveled for business to Detroit a half-dozen times over the last 4 or 5 years, and each time the place looks a bit more worse for wear. The businessmen and women (mostly attorneys) that I have met with are a hearty lot, in spite of near 30% unemployment that took many of their jobs in a massive layoff within Ford's legal department. Visiting GM and Ford was a fulfillment of a childhood dream; to see where the magic happens. Where design concept becomes assembly line reality. At the time of my last visit to Ford, they still owned the luxury lines of Aston Martin, Jaguar, Volvo, and Land Rover. Walking around the campus to see attorneys in the various buildings, you were treated to viewing these amazing machines parked in the respective lobbies.

But, to my point. If one surveys the real estate prices for an average home from around the country, the survey goes something like this:

Los Angeles --> $389,000 median price
Atlanta --> $199,000 median
Cleveland --> $139,000 median

How about Detroit? The Motor City, home to several of the largest auto manufacturers in the world, birthplace of Motown, the city that we here in L.A. thank each season for sending us Kirk Gibson, responsible for the single greatest home run moment in baseball history (can you see him now, trotting around the bases pumping his fist?).

What is their median price? I was shocked to the core when I read that according to the Chicago Tribune, a similar home to the ones found in these other major metropolitan areas can be acquired in Detroit for $7,500.

One more time: $7,500.

Unbelievable, right? That's like paying someone to take your home, please. (Henny Youngman never had it so bad.) With an annual $300 million budget deficit, they say Detroit is on the verge of bankruptcy. I remember when NY was also similarly financially depleted, on the rocks of despair. But, they rebounded. How? To start with, they lowered taxes on citizens and businesses. But, NY is the #1 financial center in the world, with an economy that reinvents itself seemingly every decade or so, with myriad industries. But, what of Detroit? D-Town is not simply financially bereft, its been sucker-punched, with soul and innards eviscerated with a self-inflicted sideways seppuku slash 30 years in the making. Does it have a miracle up its collective sleeve when so much rides on the vagaries and fortune of one industry in a state of disruption?

I don't know.

It's a city of Ichabod, where the glory has departed. And, that's hard to get back. There are plans right now calling for the bulldozing of entire blocks of the city ... the razing of large swaths of the 11th largest city in the US is a fearsome prospect. When shall (should?) the federal government step into the fray of the city corruption and ineptitude found within Detroit's body politic?

Is Detroit Obama's unspoken Katrina, with its devastated urban center, feckless federal government response, and inchoate government arrogation of the city's only large private sector? That argument could be made.

But, I do believe (well, the conservative, Ayn Rand part of me) that Detroit is a microcosm of what the Obama Admin might just do to our entire country. The citizens of Detroit have seemingly given up -- they believe they can only prosper if the city (or pick your level of government) gets them there. The radicals in the President's administration want to overhaul the entire country so that we all must look to them for answers and solutions. Detroit, with its systemic failures and city government waste and failed policies, portends for the federal government a future of health care reform, and auto industry ownership and cap and trade hocus pocus worth reconsidering.

The city of Detroit was living high on the hog as the saying goes, watching as unions sucked the BigThree dry with their onerous demands (and the BigThree took it!), embarking on reckless confiscatory policies against the businesses that employed its citizenry. Soon the city was empty, and skyscrapers emptied themselves like a drunk the morning after. Businesses moved or folded. Michael Moore had his cameras pointed the wrong way; he should have been hounding the government office holders and union leaders instead of Roger Smith (the former CEO of GM). Or at least, he should have hounded both.

Am I defending the 3 stooges of Ford, GM, and Chrysler? Hardly. They have helped to hobble the industry on their own accord (pun not intended) over the last 20 years. However, Detroit's plight may be ours as well ... if we let ourselves become addicted to easy money of the government. The citizenry cannot thrive, or even survive, at the teat of the Obama Admin. I would be saying the exact same thing if Reagan or Truman (two of my favorites) administrations were in office offering similar policies.

But, where are the reporters explicating the decrepitude of Detroit with all of its big government chickens coming home to roost? I'll tell you where. They're found in England. Surprisingly (and quite sadly) the reporters in the UK recognize socialistic tendencies when they see them and its sickening side-effects. Both The Times of London (TimesOnline) and the Daily Telegraph (my morning bookmarks) have been reporting steadily about the rise and fall (in the polls) of our president -- and his penchant for European style governance -- much more effectively than our fellow travelers of the left found in the American media. And, what's interesting (at least to me) is that the Britons are way more liberal than their Yank cousins, except they (again, at least to me) can still report a fact as a fact. I don't care if you're left, right, or center -- just tell me the facts m'am.

So, today, the TimesOnline reports that Detroit's citizens, hit hard by the economic downturn and 30 years of foolish governance, haven't been able to even bury their dead. Bodies are stacked like Lego's in the city morgue, and only a private gift of several thousand dollars has begun to empty out Detroit's morgue filled with its most unfortunate citizens already in the deep-freeze. If we can only find more private sector activities in Detroit (besides charity to the city), and keep the union's greedy little pudgy fingers out of the BigThree's pockets, we might be able to shed some light of liberty and self-governance on the lives of our fellow citizens in that once shining city to the north, full of great music, terrificly designed autos, and happy, optimistic citizens.

3 comments:

Caleb S. Garcia said...

Oh Detroit, I wish I had more to say about it. What you said though was great...muy interestante! Bravo Johnny G, my mind has been expanded.

Dumbwit Tellher said...

Is it just me or does anyone else feel the sense of despair? It feels like life will never be the same. And the good news is, it's almost the holiday season!!

Detroit Redwing Fan said...

Fascinating.

But this I do know.

I have been a diehard Detroit Red Wings fan since I was a wee boy, and I have gotten to see the privilege of my team making the finals 6 times since 1995. Those 6 finals, generated millions upon millions of revenue for the team, and mainly the city of Detroit.

The Red Wings lost the finals last year in game 7, the city was thriving in May, probably due to Wings. The year before that, they won the championship and get this, over 1.2 million people came to the parade in downtown.

I feel like the Red Wings are the blood that runs through the veins of Detroit, they play for their city, doing anything they can they to bring happiness to a failing city, all heart. It is amazing how personal all the players on the Wings have made it, they know winning a couple games in the playoffs brings so much revenue to the city in such a needed time.

But it’s just baffling to me a city could be hit that hard. I guess they always said Detroit would be nothing without the automakers.