Two weeks ago, Ed Glaeser, professor of Economics at Harvard and author of The Triumph of the City, wrote another in a series of articles that use Detroit as an example of a failed city that has lost its “entrepreneurial culture,” despite, and perhaps because of, large public investments in infrastructure and housing (see Bloomberg articles, New York Times, Wall Street Journal, and City Journal.) In these articles, Glaeser consistently argues that the country should learn from Detroit’s experience and, more-or-less, uniformly avoid federal infrastructure spending. He argues that cities should instead focus on deregulation and lowering taxes that scare away would-be entrepreneurs. “Failed public policies that tried to fix Detroit with urban renewal and transportation projects stand as stark evidence against the view that our economic woes call for more federal spending on infrastructure,” says Glaeser.
In reality, Detroit’s renewal projects of the twentieth century provide no such “stark evidence” against the potential value of housing and infrastructure investments. Glaeser’s “evidence” exists only if one ignores the details of urban renewal in Detroit and cherry picks extraordinarily broad correlations. In Glaeser’s telling, Detroit rapidly lost population throughout the latter half of the twentieth century, just as the federal government poured money into “transportation infrastructure” and “housing.” As such, says Glaeser, America should avoid such investments in the future.
A closer look at the record shows that Detroit under-invested in non-highway transportation infrastructure throughout the twentieth century while destroying thousands of units of housing. Detroit’s decades long urban renewal program was indeed a disaster for the city, not because of its investments in housing and infrastructure, but because of its embrace of the anti-urban and racist ideals and policies of the day.
Although Detroit did make a substantial investments in infrastructure throughout the twentieth century, such investments were shaped by anti-urban ideals. Apart from the People Mover project that Glaeser references, which was far too little (three miles of light rail) and far too late (mid-1980s), Detroit’s urban renewal investments in “transportation infrastructure” were devoted to miles-upon-miles of highways. Such highways ripped up and divided scores of once-functional neighborhoods throughout Detroit.
Glaeser is no friend of highway spending, but it is misleading and misguided to use Detroit’s twentieth century “transportation investments” to argue broadly against public investments in transportation infrastructure. With the exception of the People Mover, Detroit has failed to make any investments in rapid transit. Detroit nearly built a comprehensive subway in the 1920s, but residents ultimately rejected the plans because they did not want to pay the special assessments that would have funded the system. The city tried again in the ‘30s, hoping to finance a smaller system through Public Works Administration funding, but was turned away due to a subway and elevated system being considered “socially undesirable.”
As we re-embrace the ideals of urban living and move beyond what Glaeser calls the “twentieth century aberration” of suburban living, it is likely that a pre-existing and comprehensive transit system would have proven to be an asset for the City of Detroit. Such a system would likely go a long way in helping Detroit to compete with its suburbs or other cities for residents and their crucial tax dollars. Is the lesson of Detroit, perhaps, not that it failed because it wasted money on infrastructure, but rather that it collapsed because it embraced infrastructure and ideals that were antithetical to urban living?
Glaeser also states that the federal government “showered” Detroit with funds to build new housing throughout the 1960s. “Detroit’s never needed more housing or transportation,” Glaeser assures us, “declining cities are practically defined by having too much infrastructure relative to people.” In reality, while Detroit was indeed losing population in the 1960s, it was simultaneously experiencing a severe housing crisis. Unfortunately, Detroit’s “housing investments” in the 1950s and 1960s only served to make this problem worse by destroying thousands of units of low-income black housing.
The reason for this housing shortage—despite declining overall population—is that a perfect free market rarely exists in the real world and certainly did not exist in the Detroit housing market throughout the 1960s. Black Detroiters were severely limited in terms of the neighborhoods in which they could live. Black Detroiters faced the threat of violence for moving into a white neighborhood and were denied access to capital through red lining. Worse still, white neighborhoods frequently lost their access to capital if a black Detroiter were to somehow break through the color line. The result of these policies is that black Detroiters were isolated, disproportionately poor, and paid extortionate prices for low-quality housing. By 1968, 93 percent of Detroit’s black population was concentrated within one continuous ghetto.
Detroit’s “housing investments” of the ‘50s and ‘60s exacerbated this problem by removing tens of thousands of housing units from mostly black neighborhoods. By the summer of 1967, Detroit’s “housing” and “infrastructure” investments had displaced over 170,000 black residents. Between 1950 and 1970 over 36,000 low-income housing units were destroyed under Detroit redevelopment. Within the same period 15,494 units were built, but only three percent of these structures were available to black Detroiters. In fact, one of the “housing” investments referenced by Glaeser comprised the wholesale razing of one of Detroit’s few black neighborhoods, Paradise Valley or “Black Bottom.”
The “infrastructure” and “housing” investments of urban renewal were a part of Detroit’s massive “slum clearance” initiative, in which neighborhoods were arbitrarily declared slums (Detroit’s definition of “slum” comprised neighborhoods being multi-use or having “inconsistent” style of dwellings). After a neighborhood was pronounced a “slum,” it would lose access to any capital that was previously available. The neighborhood would begin to empty out as individuals and businesses of means fled, mostly to the suburbs. This effect was the self-fulfilling “wet blanket” of redevelopment, in which urban renewal would create or reinforce the very slums it was meant to eradicate. Eventually, all the neighborhood’s property would be bought up at depressed rates via eminent domain, all occupants would be evicted, the neighborhood would be razed, and the land would be sold at a discount to private developers for single-use development.
This is the notorious Title I scheme of the 1949 Housing Act. Under Title I, removal was not permitted unless those removed had access to adequate housing. Unfortunately, however, Title I did not specify how cities should accomplish the goal of providing alternative adequate housing. In response to this requirement, Detroit, like most cities at the time, simply maintained that it could be fully expected that those removed would have access to adequate housing through the private market. Such an expectation was absurd, of course, given the obvious low-income housing shortage (to which redevelopment projects consistently added to by razing thousands of low-income units).The federal government did not question the city’s rationale and consistently provided funding.
Detroit’s urban renewal program was not merely a series of foolhardy housing and infrastructure investments made by a desperate and declining city. Instead, urban renewal was yet another contributing force of the systematic isolation and degradation of black Detroiters and their neighborhoods.
Sources: Income Graphic from Rich Blocks Poor Blocks, Race Graphic Eric Fischer
The lesson of Detroit is not that infrastructure and housing investments are foolish ones for a struggling city to make, but rather that it is foolish to arbitrarily exclude 25 percent of your city’s population from the mainstream economy, to isolate them geographically, to deny them access to capital, to destroy their neighborhoods, and to force them into smaller and smaller spaces with worse and worse quality of housing that is becoming more and more expensive. The lesson of Detroit is that it is foolish for a city to embrace policies that rip up the urban fabric, that it is foolish for a city to attempt to compartmentalize all of its functions, and that it is foolish for a city to invest in infrastructure and housing policies that quickens the flow of residents into the suburbs The result of these policies is the Detroit we see today: an infrastructure-poor, disproportionately black, and disproportionately impoverished city that is isolated from the affluence and tax revenues of its sprawling suburbs. This fate was brought about not by a loss of some all important “entrepreneurial culture” but by the wholesale embrace of racist and anti-urban ideals.
Having an entrepreneurial culture is surely a good thing. It is hard to argue with Glaeser when he states that we have under-invested in the human capital of our cities, and that having a well-educated people is preferable to a poorly educated people. It is also no doubt true that it is preferable to live in a society that is capable of taking risks and is not shackled by unnecessary regulation. But it is wrong to argue or suggest that a weak entrepreneurial culture is the core problem facing Detroit and that this is the problem that brought Detroit to its current troubled state. Glaeser rightly reminds us that healthy cities are places of competition and innovation, but he must be reminded that the details matter in how such competition and innovation was snuffed out of Detroit. It is not as simple a story as he would lead us to believe.
–By Chad Hughes