The Capitalist Destruction of Detroit

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autobigthreeWell before the current crisis of capitalism shook the entire country, Michigan gave us a glimpse into the future. Michigan was once the seat of the American automotive industry, particularly in Detroit and Flint. Beginning in the late 70s and throughout the 80s, the “Big Three” (GM, Ford, Chrysler) began downsizing their production in Michigan. Seeking lower production costs, they demanded givebacks from auto workers in the form of speed-ups, wage cuts, and layoffs. They also moved production to other countries and to states with low unionization rates.

These auto industry workers, organized by the United Auto Workers, have had massive concessions forced on them for the last 30 or more years. And with auto production being a key industry for the state of Michigan as a whole, the resulting strife was widespread. Initially, those rollbacks occurred during a period of overall growth for the capitalist economy. Communities were hurt, but they could just about scrape by. Now, with the global downturn in the markets, the state’s already-strapped citizens are under the gun of even more severe austerity as the capitalist class and its political representatives greedily eye the public sector.

We are already witnessing the bankruptcy and ensuing authoritarian measures taken up by emergency coalition governments around the world. The examples of Greece, Italy, and Spain should set off alarm bells. We will soon be facing these same kinds of attacks here at home. Detroit, once a healthy metropolis, is at the forefront of this trend.

In 1980, Detroit’s population stood at 1.2 million inhabitants. With many workers relocating due to the failing job market, the population loss between 2000 and 2010 alone was a staggering 25%. This led to an overall net loss of 500,000 residents over three decades. By reducing operations, the Big Three have left the Detroit Public Schools and the City of Detroit to stand together as the two largest employers, with a combined workforce of 27,000. Now these workers have become highly vulnerable due to Detroit’s $150 million budget shortfall in the last fiscal year. Gambling, a non-productive industry, has crept into fifth place as a top employer.

The official unemployment rate throughout the metro area stands at around 11%, as compared to the city of Detroit’s official 20% unemployment rate. But if you include those no longer collecting benefits or off the statistical radar, the number is estimated to be far higher. The city’s youth experience poverty at a rate of 53%, while 20% of senior citizens live at or below the poverty line. The figures are more troubling considering the disparity between nearby Oakland County and the city proper; Oakland ranked as the fourth wealthiest county in the nation according to latest income figures, despite sharing a border with Detroit. Meanwhile, the median annual family income of Detroiters comes in at just $31,000, well below the national average of $49,445.

The most recent austerity campaign has been waged by Republican governor Rick Snyder, in the wake of union-busting legislation introduced in the Spring of 2011 by governors Scott Walker (Wisconsin) and John Kasich (Ohio). Snyder has expanded a program of “Emergency Financial Managers,” a post to which the governor may appoint either a person or a corporation (under corporate personhood) with the ability to dissolve any public sector worker contract, school board, city and town charter, and to strip collective bargaining rights. Flint, Michigan, is so far the largest city to enter the program, as of November 29, 2011. Detroit Mayor Dave Bing, a Democrat, has offered to become an Emergency Manager if Snyder declares Detroit in financial trouble. This provides further evidence that the Republicans’ and Democrats’ objectives are one and the same, and reveals their real attitude towards democracy.

The Detroit Public School system itself is currently under the control of an Emergency Financial Manager (EFM). The first Detroit Public Schools EFM, Robert Bobb, was appointed in 2009 by Gov. Jennifer Granholm, a Democrat. He immediately set to work gutting the public school system, closing 73 public schools, including those with near 100% graduation rates. Allegedly done due to population decline, this cleared the market for Bobb’s financial benefactors, who opened 70 for-profit charter schools the following year. This was a heavy blow to unionized staff and faculty. Despite his $425,000 salary, doled out by taxpayers, Bobb failed to turn around the 25% total graduation rate. Considering Detroit’s adult literacy rate constitutes barely half of all residents, a generation of new workers holds little hope for a proper education or a means to support themselves.

However, there is a national battle in the making. Workers in Ohio showed the way forward when they took to the ballots on November 8, 2011, to repeal Governor Kasich’s infamous union-busting Senate Bill 5. This bill would have effectively ended collective bargaining for public sector employees, along with instituting a “right-to-work” system in the state. The 61% vote against the legislation is proof that workers are ready to fight back. But willingness to fight is not enough. The ruling elite are well-coordinated—we must be too!

The labor movement’s biggest weakness is its lack of political independence. When the union leaders limit themselves to the politics of the supporting the “lesser evil,” they ignore the fact that both “evils” are firmly wedded to the interests of big business and the wealthy. In Michigan, as in other states across the country, the state and local governments are in a financial hole due to the economic crisis. Despite all the hype in the media about “partisan politics,” if there is anything that can unite Democrats and Republicans it is this: if anyone is going to pay for the crisis, it will not be the big corporations and the capitalist class. Quite the contrary! Public employees, retirees dependent on Medicaid and Social Security, students struggling to pay tuition, minimum wage workers, and the unemployed, who are just barely holding out month after month, on the other hand, will pay. While the representatives of both parties do a lot of hand-wringing over what they call “hard decisions,” the results are always the same: workers and the poor are made to shoulder the burden of the capitalist crisis.

The attacks instigated by the administrations in Wisconsin, Ohio, Michigan and elsewhere are symptomatic of a system that has run out of solutions. The hard-fought gains of the past are being chopped away before our very eyes.

There is an alternative: a mass labor fight back and a labor party. If the unions in Michigan want to mount a serious campaign against spending cuts and austerity, they will have to fight the city of Detroit and the state governments with union-led demonstrations and campaigns. But they must also organize an independent labor electoral challenge to Mayor Bing and Governor Snyder.


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