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.
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.)
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.
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.
Level the entire City to the ground and restore the land to pre-expansion conditions.
First solve the problems that caused this and replace all the Politicians.
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?
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?
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.
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.
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.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
[BRIEFING.COM] The stock market ended the Thursday session on a mixed note ahead of Friday's nonfarm payrolls report for February (Briefing.com consensus 163K). The Dow Jones Industrial Average (+0.4%) and S&P 500 (+0.2%) posted modest gains while the Nasdaq Composite (-0.1%) lagged throughout the session.
Equities began the trading day on an upbeat note following comments from the Bank of England and the European Central Bank, both of which reaffirmed their commitment to ... More
More Market News
Consumers are very status conscious in Asia, Africa and other emerging-market areas. This is especially true in China.
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'