How Detroit got here (and who’s profiting from its woes)


A Detroit merchandise store sign is seen in a window downtown on July 19, 2013. (Photo by Bill Pugliano/Getty Images)

The Post’s Jim Tankersley today brings us into the world of Aaron Seybert, a JPMorgan vice president charged with helping one of America’s most troubled cities:

“There are all sorts of theories in Detroit for why Seybert’s employer is dropping $100 million to help fix up parts of this city. It’s charity; it’s a secret deal with the Justice Department; it’s guilt over all the Detroiters the bank foreclosed on during the crisis; it’s a plot to privatize municipal assets. JPMorgan officials reject those theories. So does Seybert, who is the firm’s point man for distributing half of that $100 million to a pair of community lending groups, who will finance rehabilitation efforts across several neighborhoods just outside the city core. The working theory at JPMorgan, from Seybert up to the executive suite, is that spending $100 million in America’s most famously bankrupt city is a good investment. Good for Detroit, yes, but also good for JPMorgan. Best case, good for America.”

The outcome of JPMorgan’s program is yet to be determined, but Detroit’s need is obvious. Here’s a look at its challenges:

1. The Motor City’s population has been falling for decades. 

The data: Detroit’s population today stands at 688,700 residents. That’s down almost 10,000 from 2012. The city’s population peaked at 1.85 million in 1950.

The story: Ingrid Norten writes in the Los Angeles Review of Books about one cost of the flight to suburbs, including a longer wait for emergency help. First responders often live outside the city:

“It is common for city first responders to live in the suburbs themselves: over half the Detroit police force live outside the city, and the number is estimated to be higher for firefighters and EMTs. The city used to require its employees to live inside Detroit, but the law was controversially repealed in 1999, which led to massive suburban flight among emergency responders and other city employees. The current mayor, David Bing, has an initiative called “Project 14″ to lure police to live in the city again with massive subsidies (“14″ is police code for “return to normal operations”). Bing argues that having police live inside city neighborhoods bulwarks safety. Detroit police who live in the suburbs counter that the city — with its high insurance rates, limited services, and poor school options — is a very difficult place to raise a family.”

2. Detroit owes around $18 billion, and it’s battling with 170,000 creditors.

The data: Last year, when the city filed the largest municipal bankruptcy in America’s history, the emergency manager figured its total debt hovered between $18 billion and $20 billion. The city is now in a tense battle to restructure its debt and still pay for basic services.

The story: One possible way to raise awareness over Detroit’s needs, according to the Detroit Free Press: taking the city’s bankruptcy judge on a bus tour.

“If Detroit’s bankruptcy lawyers have their way and take a federal judge and creditors on an eye-opening bus tour of the city, they’ll need to present a mixture of the despair and hope, of the naked abandonment and joyful rebirth, for a true picture.

“Details of the tour — where it would visit and when — are under wraps, a closely held secret. Today the Free Press offers its own itinerary of can’t-miss spots, dark and bright, for the city and U.S. Bankruptcy Judge Steven Rhodes to visit….

“The bus tour would be a court hearing on wheels, evidence for the judge to soak in as he prepares to hear arguments from the city on one side and some creditors over whether a plan to shed $7 billion in debt should be approved.”

3. One huge cost: the city’s thousands of abandoned and blighted buildings.

The data: 78,506 buildings are officially deemed blighted, Wonkblog’s Emily Badger reported in May. It’ll cost something like $850 million to deal with the damaged single-family homes and another $500 million to $1 billion to deal with commercial and industrial properties, Badger wrote.

The storyNew York Times reporter Monica Davey rode along with digital mapping experts tasked with counting and photographing each one:

“A midnight blue Chevy rolls slowly down a snow-covered street, an emergency strobe light on its roof and a sign on its side that promises this is ‘official business.’ At each house, business, even vacant lot, workers in the car pause to decide whether someone lives there and what shape the place is in before snapping a photo and beaming it to ‘mission control’ miles away.

“All over Detroit, scores of these workers — on some days as many as 75 three-person teams — have been wending their way through the streets since December, cataloging on computer tablets one of this bankrupt city’s most devastating ailments: its tens of thousands of abandoned and dilapidated buildings.”

4. Detroit’s murder rate is more than 10 times the national average.

The data: Detroit had 386 murders in 2012, up from 344 in 2011 and only 10 less than in 2000, when the city had 200,000 more residents, according to the FBI’s crime database. The murder rate is 54.6 per 100,000.

The story: Mother Jones reporter Charlie LeDuff  takes us inside the killing of a 7-year-old girl. The officer who fatally shot her was charged with involuntary manslaughter.

“It was just after midnight on the morning of May 16 and the neighbors say the streetlights were out on Lillibridge Street. It is like that all over Detroit, where whole blocks regularly go dark with no warning or any apparent pattern. Inside the lower unit of a duplex halfway down the gloomy street, Charles Jones, 25, was pacing, unable to sleep.

“His seven-year-old daughter,Aiyana Mo’nay Stanley-Jones, slept on the couch as her grandmother watched television. Outside, Television was watching them. A half-dozen masked officers of the Special Response Team — Detroit’s version of SWAT — were at the door, guns drawn….

“The SWAT team tried the steel door to the building. It was unlocked. They threw a flash-bang grenade through the window of the lower unit and kicked open its wooden door, which was also unlocked. The grenade landed so close to Aiyana that it burned her blanket.”

5. The water department is also drowning in $118 million in unpaid charges. 

The data: In July, the Detroit Water and Sewerage Department said nearly half of its customers haven’t been paying their water bills in full, for a total of about 90,000 delinquent accounts, Wonkblog’s Emily Badger reported. Thirty-eight percent of Detroit lives below the poverty line.

The story: The water department shut off service to thousands of homes, sparking outrage and protests across the city. However, the move wasn’t as simple as government incompetence or indifference to the poor, Badger writes.

“As the Detroit Free Press editorialized, the utility has long tolerated unpaid bills, creating a ‘culture of nonpayment.’ Last year, however, under the city’s new emergency management, the department began an aggressive campaign to shut off water to unpaid accounts, and the effort has ramped up in the last three months. In May, the department says it sent shutoff notices to46,000 accounts. But officials point out that many more customers respond to these letters by immediately paying their bills, or setting up payment plans, than by having their water cut off.”

6. From the ruins, an industry of “ruin porn” emerges.

The data: About one-third of the city’s approximately 140 square miles is vacant.

The story: John Patrick Leary of Guernica examines how Detroit’s misfortune can be lucrative for some:

“‘Do you have any books with pictures of abandoned buildings?’ demanded a customer of a bookseller friend of mine at Leopold’s Books in Detroit. The man marched to the cash register and abruptly blurted out his question, looking, perhaps, for one of the recent pair of books on Detroit’s industrial ruins and its abandoned homes, Andrew Moore’s Detroit Disassembled and Yves Marchand and Romain Meffre’s forthcoming The Ruins of Detroit. These two books, along with the architectural history Lost Detroit: Stories Behind the Motor City’s Majestic Ruins, are part of a small Detroit culture boom over the last year. Besides the new books by Moore and Marchand and Meffre, photographers have chronicled the city’s decaying structures in the likes of Slate.com, the New York Review of Books online, and Time, which moved a troupe of Detroit bloggers to an old mansion on the city’s east side, an old-fashioned news bureau mixed with a bizarro-Real World social experiment.”

Danielle Paquette is a reporter covering the intersection of people and policy. She’s from Indianapolis and previously worked for the Tampa Bay Times. Follow her on Twitter: @Dpaqreport.
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