6 ways to rebuild Detroit

With its bankruptcy filing, it has a chance to start over. Step one: Take some tips from a city that reinvented itself.

By Aimee Picchi Jul 19, 2013 12:58PM

No one's arguing about Detroit's current situation. It's clearly a mess, with residents suffering from a high crime rate, stark poverty and scant public services.


With its bankruptcy, the city is hoping for a clean slate, giving it a chance to reorganize and adjust its debt. Still, Detroit's list of problems is so long that it prompts the question of whether it's even possible to save the city. 

Skeptics need only look to another former down-and-out Rust Belt city to see that it's possible to revitalize: Pittsburgh. 


The Steel City's rivers were once lined with smoking factories. When the steel mills began to shut down in the 1970s, tens of thousands of jobs were lost and the middle class began a flight to the suburbs. (Some of those fleeing to the 'burbs included my grandparents, who were born and raised in Pittsburgh.)


A car drives past the remains of the Packard Motor Car Company in Detroit, Mich., on November 19, 2008 (© Spencer Platt/Getty Images)Sure, Pittsburgh still has problems. But the city illustrates that a once-troubled place can stabilize -- and even grow. Its population is finally eking upward after six decades of declines. Even better, Pittsburgh is attracting new employers, such as Google (GOOG). 


To be sure, Detroit is arguably in worse shape than Pittsburgh ever was, and it will likely need to take stronger measures than its smaller neighbor to the east.


While the first step will focus on finances, such as possibly reducing pension guarantees for younger workers, Detroit also must plan for longer-term issues, such as how to reverse a devastating population loss that decimated its tax base and left much of the city feeling abandoned.


Here are half a dozen things Detroit can do to get back on track:


Provide college scholarships to high school grads. Here's the deal Pittsburgh has offered since 2007: Kids who live in the city and graduate from one of its public high schools with a minimum GPA of 2.5 are eligible for a $40,000 college scholarship. The program is off to a solid early start, according to research company Rand. A similar plan may be one way to keep families from moving out of Detroit.


Knock half of it down. As Dan Gilbert, the chairman of Quicken Loans, tells CNBC in the video above, the city has "something like 120,000 structures that need to be removed," including houses and office buildings that are falling down amid neglect. Investor William Pulte is urging the city to tear down half of its buildings. Pittsburgh took this route with some old factories such as the Homestead Works, a massive mill, which was revitalized with The Waterfront shopping mall. 


Focus on "eds and meds." Expand the city's education and medical industries, another tactic Pittsburgh took. The Detroit Medical Center, bought by Vanguard Health Systems in 2010, has benefited from millions in investment. Detroit should court nonprofits and philanthropists to invest in Wayne State University, in midtown Detroit, and its other schools.


Don't sell the city's historic assets. One controversial proposal recently floated by emergency manager Kevyn Orr is to sell some pieces from the Detroit Institute of Arts. It's a tough dilemma, pitting Matisse against paying the electric bill. But if Detroit envisions a vibrant future where tourists one day come to visit its museums, it should hang on to its cultural heritage. 


Create a new "homestead" act. After tearing down delinquent properties, Detroit will have a lot of space on its hands. Why not create a new version of the Homestead Act, the 19th-century federal law that granted land ownership at little or no cost? That's an idea advocated by the architect Daniel Libeskind, who once lived near Detroit. It may spur some people to relocate to the Motor City, helping to boost development and growth. 


Lobby for a federal bailout. This is controversial and, frankly, unlikely to happen, but it's worth a try for Detroit's desperate managers. After all, the U.S. government bailed out the automakers. So far, the White House says it's "monitoring" the situation, although CBS Detroit reports that no federal bailout is in the works. 


Follow Aimee Picchi on Twitter at @aimeepicchi.


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81Comments
Jul 19, 2013 1:23PM
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The democrat welfare party has destroyed the will to work hard and be loyal. Why work today when everything is free off others hard work. The leeches on us workers is getting old.
Jul 19, 2013 1:21PM
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Until we kill the failed welfare food stamp hand outs every city is doomed one by one.


Jul 19, 2013 1:28PM
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This is how the rest of our great Country will crumble. Its simply a matter of time.
Jul 19, 2013 1:25PM
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I have an 1 idea how to rebuild Detroit.

forcibly relocate all individuals who played a part in the cities demise, to within the city limits.

this would include all the so called experts who want to help from afar.

all present and retired city employees, with their nice paychecks and pensions.

all former mayors, their friends and familys

all former city council members, their friends and families.

all 3 auto companies ceo's

all uaw leadership

all the middle class black families who couldn't wait for the white familes to move from the city, but, then quickly followed them to the suburbs..

all these people sucked the city dry with their greed and corruption.

 

THEY SHOULD BE FORCED TO LIVE IN WHAT THEY CREATED.

Jul 19, 2013 1:25PM
Jul 19, 2013 1:31PM
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Level the entire City to the ground and restore the land to pre-expansion conditions. 

Jul 19, 2013 1:29PM
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Perhaps a full attack by the national guard or the army to clean out the bad element there would help. What business is going to invest in an area of high crime and low workforce that can be trusted as an employee. Detroit should be scraped to the ground and started over. Perhaps in 60-70 years it could be a thriving place again but I doubt it. Detroit, like the rest of the industrial rust belt in our country are the victims of government policies on imports, labor disputes, corruption and graft. Now how do we rid ourselves of either.
Jul 19, 2013 2:47PM
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First solve the problems that caused this and replace all the Politicians.

 

Jul 19, 2013 2:43PM
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tick, tick, tick, tick, tick, who's next? detroit won't get a bail out. detroit is not a bank. detroit IS NOT too big to fail.
Jul 19, 2013 2:17PM
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Has any of the talking head experts ever heard the old saying "you can sheer a sheep a hundred times, but you can only skin him once?"  Or perhaps a new one, "only an idiot performs a hysterectomy on the Golden Goose." 

Get it through your thick heads governmental workers at all levels, we the people cannot afford to be skinned any longer and by way of the overall cost of employing you during and after your career, we are broke, plain and simple, you've effectively performed the hysterectomy on the Golden Goose.  Your snouts just couldn't shrink enough to avoid chasing business overseas with your rules, regulations, inefficiency, attitudes, fines, penalties, obstructive behavior, greed, arrogance, outrageous nastiness, on and on and on.  To all ye union devotees, satisfied yet? 

Jul 19, 2013 1:58PM
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The "Big Three" buried Detroit when they started outsourcing overseas all the subassemblies for autos. Their answer to the union wage and benefit demands was to simply raise the new car price while cheapening and cost-cutting the quality in design. Excessive profits equaled excessive bonus for the top echelons. Over compensated salaried executives sat idly by while the foreign auto makers flooded the U.S. economy with cheap autos. Automakers simply ignored customer demand for quality and value.

 

The cancer of Detroit is spelled GREED, LAZINESS, continual big annual profits and outlandish annual bonus to management who didn't bother to manage.

 

Ford is the only exception; they 'woke up' in the nick of time- see where Ford is now?

Jul 19, 2013 2:40PM
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any of you pensioners in the other large cities that are tipping toward bankruptcy take note. this is a trial balloon. pensioners in detroit will take a haircut just as they are taking in euro land (greece). everyone in the u.s. take note. detroit has a debt of 18 billion$. the debt of the u.s. is 17 trillion$. detroit is bankrupt, so is the u.s. i leave you to connect the dots.
Jul 19, 2013 1:37PM
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I agree with the knockdown part. Some cities, even small ones, look like crap. The layout stinks, abandoned buildings, ugly buildings, get rid of them, come up with some type of lay out plan to make the place LOOK NICE. I would rather live in  small town and drive than live in some of these small to medium size cities that are PLAIN UGLY. Big cities that have ALL the problems Detroit has, WILL NEVER ATTRACK ANYONE if it is unattractive to look at, drive thru, or live in. STEP ONE: Start tearing down and do NOT rebulid UNTIL someone decides to set up zoning and giving out building permits to peopel with ATTRACTIVE ideas about the building and the area they are building in. CHEAP is NOT good.
Jul 19, 2013 2:22PM
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I have another idea.  Don't "haircut" the benefits of retirees now or in the future excessively.  Simply mandate that those who move from the cities that employed them and from which they receive their pensions do so with a 20% reduction in benefits.

Simple, equitable and economically prudent.  It is called reciprocity.  If you expect the Golden Goose to provide you with post employment benefits that support you, the Golden Goose should be expected to be supported post career by your presence. 

Jul 19, 2013 2:09PM
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Detroit is not worth saving and I don't think anything could save it anyway.  Bulldoze it level and walk away.  If you are thinking of electing dems to run your city or if you have dems running our city, this is your fate and you deserve it.  L,A. is next.

Jul 19, 2013 2:51PM
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I certainly don't want to bail out Chicago.. nor would I want to California! Not when they created their own mess! And how about all the people they are going to screw out of their money owed them! This is wrong, plain and simple, because in the end, it will cost the less than half of America who are working, taking care of the other half! 
Jul 19, 2013 2:55PM
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Gee, where are we going to keep coming up with the billions & trillions to bail out all the distressed cities that are in this mess?  Can you say, "collapse of a nation!!!?"
Jul 19, 2013 1:46PM
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Let OCP buy it and run it, but first they need Robocop working.
Jul 20, 2013 7:25AM
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Detroit is like a wagon....

 

The wagon is full of freeloaders... And everyone that pulled the wagon fled.  They will not return until the wagon is empty.  

 

So...  Declare Detroit a tax free zone for 5 years.  They eliminate any welfare and ALL welfare payments there.  This will force the leeches to move on, and encourage business to locate there (read jobs).  Then phase out the tax cuts over 5 more years.  Reduce tax levels to 25% of Michigan's average.   The state should eliminate sales and income taxes in Detroit for 5 years as well.  Ban all public employee unions.  Transfer all municipal pensions to the state.

 

Once Detroit is back on it's feet, the state should insure that it cannot borrow money, except for infrastructure.  NONE maybe be used for salaries. 

Jul 19, 2013 2:45PM
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Wasn't this the exact premise of Robocop?
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