Why Billionaires Won’t Save Detroit

Billionaire Dan Gilbert shows a fellow billionaire his model of downtown Detroit.

This is a revised version of a Facebook post I wrote in March. I publish it here as we prepare for the upcoming Mackinac Policy Conference, Michigan’s annual island orgy of corporate greed and political self-interest. It’s also pertinent as we consider the impending nomination of nativist demagogue Donald Trump as the Republican candidate for President of the United States.

By the way, in case you were thinking of going to the Conference, registration at the Conference for non-members of the Detroit Regional Chamber is a cool $2,925, about one and a half times as much as the average Detroit household earns in a month.

This gives you a good idea of how the event hosts think about the unwashed peninsular masses.

(They don’t.)

Our “Q”

Back in March, we received the revelation that Dan Gilbert, having purchased naming rights to the three-mile M-1 streetcar for a cool $10 million, had decided to name it after…his own mortgage company, Quicken Loans.

Freep editor Stephen Henderson, a native Detroiter, professed to be shocked and disgusted by this development. Henderson, who’s done a good deal to draw attention to the need for better transit, wrote in his regular column: “The QLINE name suggests, subtly, that this isn’t about that wider need for transit, or the people who so desperately need it.”

Indeed, the choice of name suggests many things.

You know what else is suggestive? Funding a three-mile streetcar line. Specifically, one which happens to duplicate the routes of at least half a dozen existing bus lines, serves only the gentrifying areas of downtown, Midtown, and New Center, and is built in such a way as to eliminate the possibility of potential improvements in current transit travel times, or any future extension as a rapid transit line.

Whether it suggests those things “subtly,” I leave to readers to determine.

The QLine: A naughty name? Stephen Henderson thinks so.

Only the Billionaires Can Save Us!

Interestingly, Henderson still writes of the streetcar proposal: “I’d hope it’s also a predicate for sustained private and philanthropic involvement in transit; government funding is too shallow, on balance, to meet the region’s profound needs.”

This statement, from the editor of the ostensibly more liberal of the two major Detroit papers, deserves our studied attention.

Perhaps Henderson is right. Perhaps we should expect the likes of Gilbert, Illitch, and the redoubtable Matty Moroun to be more involved in funding public transit. Perhaps we should also expect them to compensate for the “shallow” level of government funding in other areas of “profound” need, such as education, social services, and just about everything else.

In fact, however, we already have a mechanism to compel our friendly neighborhood billionaires to contribute towards the public good.

It’s called government. Government of, by, and for the people, as opposed to the billionaires.

…Except They Won’t

The longing for private “philanthropy” that resolves our region’s astonishing inequality and dysfunction is not hard to understand. For decades, rampant segregation between black and white, not to mention the growing gap between rich and poor, has frustrated attempts towards the collective good.

In the region and the nation, the notion that collective public action is even a worthwhile enterprise has been subject to a thousand cuts. For nearly half a century, corporate-funded think tanks like the Dow-funded Mackinac Center for Public Policy have made it their mission to convince us that government is the reason for everything wrong with this country.

More subtly, these think tanks also spread the idea that black folks and the poor were lazy freeloaders, and if they just pulled up their pants and got jobs – which, of course, are so plentiful in Detroit these days – they’d be far better off.

(This was, in fact, the principle behind Governor John Engler’s 1992 dismantling of welfare in Michigan. To read more about Engler’s vile, pseudo-Catholic views on poverty, read this gruesome interview, in which he calls the “so-called Great Society” a “social disaster.” The Great Society, you may recall, was the idea that maybe people shouldn’t have to live their lives starving with no medical care.)

Going back to Henderson’s comment: If government funding is so “shallow,” perhaps there are reasons for that. Reasons that might include the fact that dozens of wealthy suburban jurisdictions presently contribute nothing towards regional transit. Or that the very corporate interests Henderson calls on for help receive enormous tax breaks that rob our schools and city governments of desperately needed funds.

(It’s not often talked about, but a massive wealth transfer from Michigan families to corporations occurred back in 2011, when Snyder and the Michigan Legislature cut corporate taxes by $1.6 billion and raised taxes on individuals by $1.4 billion. To our friends at the Mackinac Conference, of course, this reverse-Robin Hood proposal was the best thing since the Model T.)

Is there a role for philanthropy, and corporate altruism (such as it is), in addressing our present crisis? Well, sure. In the current political and economic climate, I won’t argue with foundations giving money to build bike paths in Detroit, or even with foundations (i.e. Skillman) trying to get the Michigan Legislature to pass bills that would help avert the implosion of the Detroit Public Schools under state emergency management.

Should we expect these sources to provide the momentum for establishing regional public transit, redressing our gaping economic and social divides, and reforming our ridiculous system of apartheid governance?

I would answer:

Just about as much as we might have expected Ford and General Motors, a hundred years ago, to lead the charge for taxing corporate profits, securing workers’ right to form a union, providing seatbelts, and installing catalytic converters in their vehicles.

Walter Reuther and friends find Ford Motor Co. less than friendly to social reform.

Spoiler alert, for those who don’t know their history: the automakers didn’t exactly lead the charge on any of those, except insofar as they led the charge against them, as indicated in the photograph above.

A Streetcar Named Desire

Let me tell a longer story that suggests how reasonable it is to expect aggressive public-spirited action from our present corporate leadership without a revitalized public sector.

About four years ago, as the businessmen (and they were, almost without exception, men) behind the M-1 streetcar proposal were trying to get millions of dollars in federal subsidies for their project, I had the opportunity to sit in on a meeting between them and the U.S. Secretary of Transportation at Detroit’s Coleman A. Young Municipal Center. Also in attendance were Detroit Mayor Dave Bing and Michigan Governor Rick Snyder, along with a number of members of Michigan’s congressional delegation.

The catch: the U.S. Secretary of Transportation was Ray LaHood, a decent man.

A former Republican congressman, the son of a Lebanese immigrant restaurant owner, LaHood did not feel he could, in good conscience, provide millions of dollars for this corporate pet project without some assurance that the metro region was on track towards an expanded transit system that served the needs of the city and region, not just the whims of a few billionaires.

Former Secretary of Transportation Ray LaHood.

The Secretary said that to get the money for their 3-mile streetcar line, these captains of industry had to get the Michigan Legislature to pass legislation to create a Regional Transit Authority that could expand transit throughout the region.

I watched from a corner of the room as Dan Gilbert and others pleaded that they’d already done everything they could. Just give us the money, they said, like kids asking for their allowance after cutting corners on their chores.

The Secretary’s voice rose in something approaching anger. “I want a regional transit authority,” he said. “For the people.”

The Governor spoke up in his halting, nasal way. “We’d appreciate your strong support,” he told Gilbert and the rest, “as opposed to just support.”

“You all are very powerful people,” the Secretary said. “You know the people in the Legislature. Now go tell them what they need to do.”

Grudgingly, the most powerful men in Michigan left the room.

The State We’re In

If you haven’t noticed, we live in a new Gilded Age. Money and power in this nation, and in Michigan, are more unevenly distributed than they’ve ever been.

Some of us, including self-styled “liberals,” have clearly adjusted our expectations to fit our oligarchic reality. I myself plead guilty on that account.

I would suggest, though, that there are limits to moral suasion of entities bound by law to deliver shareholder value.

Who was it, after all, whose factories pioneered the flight of people and capital from Detroit? Who was it who pitted black and white against each other, who cynically shipped in refugees from the South as strikebreakers for their plants, who wrung profits from blockbusting neighborhoods, exploiting white prejudice for the sake of their bottom lines? Who, more recently, sold the faulty mortgages that decimated Detroit’s neighborhoods?

hunger march
Demonstrators are tear-gassed outside Ford’s Rouge Plant, 1932.

The same powerful interests that made the mess we’re in can’t be called on to get us out of it.

A Progressive Generation

Instead, let’s look to past examples: in particular, a generation of civic leaders of the last Gilded Age, a century ago.

People like Mayor Hazen Pingree of Detroit, on whose statue on Grand Circus Park, overlooking the new streetcar tracks, is inscribed:

“He was the first to warn the people of the great danger threatened by powerful private corporations, and the first to awake to the great inequalities in taxation and to initiate steps for reform.”

Hazen Pingree of Detroit, hanging out along Woodward in Grand Circus Park.

People like Mayor Tom Johnson of Cleveland, who warned of the corporations:

“If you do not own them, they will in time own you.”

Or like Mayor Samuel “Golden Rule” Jones of Toledo, who wrote:

“Back of every enterprising capitalist stands the entire nation, without which not one of his schemes could succeed…No man can point to his pile of gold and say ‘Alone I earned it.’ What is called Socialism is not a visionary plan for remodeling society; it is a present fact, which is not yet recognized in the distribution of wealth.”

Remarkably, all three of these men were once captains of industry before they turned to politics. Pingree was a shoe manufacturer; Johnson, a streetcar baron; and Jones, an oilman. With intimate knowledge of the relations of power, they took it upon themselves to change them. Instead of wrapping lucrative, publicly subsidized investment in the guise of charity, a la the QLine, they deserted the corporate world to champion the cause of the common people by restoring democratic government control.

The Help We Need

If there is a new generation of these businessmen-turned-social reformers in the making, they are very few and far between. Things are so desperate, even Ralph Nader – the incorrigible corporate critic who took on General Motors – has written a novel, Only the Super-Rich Can Save Us, picturing a rebellious group of businessmen who decide to set things right, in true Pingree-Johnson-Jones fashion, out of enlightened self-interest. Yet in today’s vastly different world, it’s hard to see that happening.

As most corporations have severed ties to local communities and even to the United States as a whole, truly civic-minded business leaders have gone the way of the dinosaur. We may not see their kind again. Donald Trump, the tycoon turned presidential contender, is an ugly mockery of that vanished tradition. In Detroit, we have the nauseating spectacle of billionaires begging for tax breaks as public schools disappear.

However, we can still lift up the ideas that Pingree and the other progressive mayors put forward. Chief among them, the principle that a city, state or nation can only truly thrive if all its people thrive, too. In today’s Detroit, that also has to mean black, brown and white together, not just an elite of the pale, male, and privileged. (Check out the photo at top.)

Henderson is wrong: in the long run, corporate beneficence will not save us, in Detroit or anywhere else, in securing the right to decent transportation or any other human need.

We are the ones we’ve been waiting for. We are the people we need. In Detroit and beyond, let us look to government of the people, by the people, for the people, that it may not perish from the earth.

Next time: how an impoverished city might go about rebuilding the public sector.

4 thoughts on “Why Billionaires Won’t Save Detroit”

  1. What a load of partisan drivel. Apparently decades of liberalism did nothing to tarnish the once great city of Detroit, let’s blame it on the billionaires, republican policy makers and corporations. More good has been done by these “billionaires” in the past 5 years than in my past 50 years of watching the decay. – Fred Gendron, Southwest Detroit, born and raised.


    1. Drivel it may be, but I do want to respectfully point out that Mayor Pingree and “Golden Rule” Jones, who I praise, were both Republicans, as is former Secretary of Transportation Ray LaHood, whereas Stephen Henderson, who I criticize, is editor of a Democratic-leaning newspaper.

      I’ll readily acknowledge that in this century, my sympathies do lie more with the Democrats, and especially that wing of the party that still stands up for working people and poor people, as opposed to the corporations that hung Detroit out to dry – aided and abetted, it must be acknowledged, by politicians from both parties.

      But if this piece is drivel, I tend to see it more as nonpartisan drivel, true to our motto of “small d in the big D.”


      1. I appreciate your reply, and I do realize this is a liberal site but just had to point out a few “omissions” from your viewpoint. For the record, I now live in Farmington Hills but still do have connections to the old neighborhood. As many times I’ve heard of the “Renaissance” of Detroit, it really seems like things are moving in a positive direction, at least from the inner-ring (Downtown). Hopefully some of the social issues you bring up will benefit from this new resurgence. – Fred


  2. Fred: Certainly. I’m actually very glad that some corporations are finally deciding to invest in the city again. In the long run, I do believe that this could make business and political leaders more attentive to the pressing needs of Detroiters. Yet in the short run, I fear that the downtown “renaissance” is not changing the very difficult realities that most Detroiters face on a day-to-day basis, which are in many respects a direct result of state policies. Redevelopment must happen together with policies that reverse longstanding inequality in the region, for the benefit of city and suburbs alike, and ensure democratic rights for all. (Indeed, the process of disinvestment is already visible in many inner-ring suburbs – Southfield, for one, lost a large chunk of its tax base when Quicken, the Blues, and others relocated to Detroit.)

    Thanks for setting a standard of respectful dialogue and debate. While I do engage in some polemic, I think people should be able to engage in political debate without resorting to the belief that those who disagree are stupid or evil – and I’m afraid we can’t really look to national politics for many examples at the moment.




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