Opportunity Detroit

Detroit's glittering revival isn't just leaving most residents behind — it's premised on their impoverishment.

Thomas Hawk / Flickr

The scale of Detroit’s ongoing transformation is staggering. There are new hockey and basketball stadiums, a streetcar system and dozens of luxury apartment complexes. New storefronts showcase the wares of companies like Nike, Under Armour, and Whole Foods. Reconverted corporate skyscrapers look down on the city.

A century ago, Detroit turned itself into a mecca of Fordism. Now, after seven decades of capital flight that cost the city more than 90 percent of its manufacturing jobs, Detroit is being remade again — this time into a mecca of post-Fordism.

There is perhaps no greater emblem of this highly touted turnaround than the $900 million Hudson’s site project, which broke ground last month in downtown Detroit. Once the world’s largest department store, Hudson’s closed in the early 1980s, and the city imploded the building about a decade later. At the time, downtown Detroit stood so empty that photographer Camilo Jose Vergara proposed a public art project: “an American Acropolis,” with “a dozen city blocks of pre-Depression skyscrapers . . . left standing as ruins.”

Since the mid-2000s, most of those vacant buildings have been converted into high-end retail and residential space and offices for white-collar firms. The Hudson site — a gift from the city to real-estate mogul and Quicken Loans founder Dan Gilbert for relocating his company downtown — will follow the same playbook. Gilbert is transforming it into the state’s tallest skyscraper, complete with pricey retail space and hundreds of luxury apartments.

In the national folklore, it is Gilbert — Detroit’s “superhero,” according to the Atlantic — who helped Detroit escape its downward spiral by investing billions in the real estate market when other capitalists scorned it. He now owns at least ninety-five buildings in Detroit and wields immense influence over the city’s future. Even many of his critics admit that he’s had a positive impact. Sure, they say, he owns a huge chunk of downtown and enjoys incredible power over the local economy. But what would Detroit look like without him?

This is a false premise. The choice isn’t between billionaire-led investment and the destitution of the city. On the contrary: the revival spearheaded by people like Gilbert is made possible by, and depends upon, the poverty and dispossession of working-class Detroiters.

Built in Detroit

“Come discover the opportunity that is called ‘Detroit,’” Gilbert raved in a letter last year urging Amazon to establish its second headquarters in Detroit. Here, Gilbert promised, Amazon would find low taxes, cheap real estate, and a local government willing to accommodate investors.

Gilbert’s words weren’t pure boosterism. Detroit’s history of poverty, neglect, and austerity have proven lucrative for today’s business leaders. The most obvious example is the city’s abundance of vacant buildings, which speculative, multinational investors have bought up in droves in recent years. But the logic is seen even more directly in the poverty tours that have popped up around the city, in the “Made in Detroit” marketing campaign used by companies like Shinola, and in the success of the “Detroit Hustles Harder” boutique clothing shop.

Detroit’s poverty has become one of the city’s most marketable assets. “We are gritty,” as Gilbert told Amazon.

For many, this is imaginative marketing, a way for the city to turn itself around. The New York Times, for instance, recently called Detroit “The Most Exciting City in America.”

In contrast, community activists have taken up the historic call of “We Cry Genocide.” They point out that skyrocketing rents and doubling property values downtown have produced mass displacement, often facilitated by the Detroit Police Department (DPD), which uses broken-windows tactics and has a mandate to remove unwanted loiterers.

The city’s east and west sides bear the scars of this process most starkly. In 2015, the rate of jobs to residents was around one to ten; since 2005, more than one in three homes has been foreclosed; since 2013, more than one hundred thousand residents have had their water shut off; since DPD’s overhaul, these neighborhoods have endured a series of violent drug raids, many of them botched, while nevertheless having to wait over an hour for emergency services to respond.

Some acknowledge the rampant inequality that marks Detroit’s so-called rebirth: the phrase “Two Detroits” has its own Huffington Post article, Vice documentary, Urban Institute study, and Tumblr blog. It also formed the basis of Coleman Young Jr’s recent mayoral campaign.

But observers tend to frame the problem as too little — not too much — capitalism. As the Atlantic put it, “Gilbert’s (and the city’s) next big challenge is to spread this success to Detroit’s sprawling outer neighborhoods, many devastated by abandonment.” Rather than decry a political-economic system that has time and again ravaged Detroit’s working class, Heaster Wheeler, former executive director of the city’s NAACP branch, has called on a new generation of black entrepreneurs to solve the city’s problems, dubbing them the “Black Dan Gilberts.”

Yet investment and dispossession are not two separate phenomena. They are two elements of the same process. Downtown revitalization doesn’t go on in spite of neighborhood deprivation  — it depends on these deprivations. In short, the problem is not that there are Two Detroits. The problem is that there is One Detroit that operates according to the needs of business.

Detroit has become a living illustration of one of the dynamics of capitalism, in which wealth accrues at one pole of society in direct proportion to the poverty and misery that concentrate at the other.

Three examples showcase this phenomena. First, in 2013, the city published the Detroit Future City Strategic Framework (DFC), “a blueprint for Detroit’s future.” The DFC suggested cutting services in the city’s poorest neighborhoods in order to pay off creditors or free up resources for more “viable” areas. In short, the most impoverished would bear the costs of crisis and shoulder the burden of revitalization.

A second example: Gilbert has received $250 million in public subsidies for the Hudson’s site project and other new developments. The “browning legislation” he helped write has legally enshrined this transfer of wealth from poor to rich. According to the law, all development on “blighted” land is eligible for public subsidies, and developers are allowed to capture sales and income taxes from their commercial projects.

The devastation wrought by the previous generation of fleeing investors has therefore become a goldmine for today’s capitalists. And the wealth won’t trickle down. Detroit elites have created a closed circuit in which the profits from downtown development largely remain in the pockets of a handful of wealthy investors.

These pro-business policies are best understood not as corruption, but rather as symptom of capitalists’ growing structural power over workers and municipal governments — a power that Gilbert used when he wrested another $200 million out of Detroit after threatening to move Quicken to Cleveland.

Finally, a deal between Gilbert and the city around an unfinished criminal justice center just northeast of downtown further reveals the character of Detroit’s comeback. Construction on the project stalled in 2013 due to cost overruns, but Gilbert’s Rock Ventures recently proposed a (heavily subsidized) $1 billion, high-end commercial center for the site. In exchange, his company will construct a (heavily subsidized) $500 million criminal justice center at a neighboring site, which includes a 2,280-bed jail, a juvenile detention facility, and twenty-five courtrooms.

A jail and an upscale commercial center, shoulder to shoulder — it’s difficult to imagine a purer distillation of the processes unfolding in Detroit.

Jails, police, and private security (several hundred Gilbert-hired guards are stationed downtown at all times, and Gilbert’s five-hundred-camera surveillance system covers pretty much all of downtown) have emerged as the preferred methods for containing and disciplining the people whose very presence has come to be seen as a threat to the economic activity that post-industrial cities like Detroit depend on: tourism, real estate development, luxury consumption, financial speculation, and investment by white-collar firms.

In 2016, Detroit spent $547 per capita on police; the same year, per capita spending on food stamps in Michigan was just $21.

A Better New Detroit

When ground broke on the Hudson’s development, protesters showed up to decry the fact that the billionaire’s project was subsidized by residents of a city with a 40 percent poverty rate. Gilbert responded that they were not being “rational.” Without such subsidies, he insisted, investors would move their capital elsewhere.

But the community activists had it right: the corporate revival can’t be divorced from Detroit’s immiseration. These are mutually constitutive processes, wherein the city is remade into a center of investment and profit-making — at the direct expense of the poor and working class.

A genuinely new Detroit would look very different. It would be a place where the fortunes of residents did not rise and fall with the market, where workers had the power to address devastating problems like homelessness, joblessness, and service cuts. And it would be free of billionaires like Gilbert, whose commitment to the city extends only as far as the profits he can siphon from it.

End Mark

About the Author

Philip Conklin is coauthoring a book about the political economy of Detroit with Mark Jay.

Mark Jay is a doctoral candidate in sociology at UC Santa Barbara. He is coauthoring a history of Detroit with Philip Conklin.