• Home
  • Latest
  • Fortune 500
  • Finance
  • Tech
  • Leadership
  • Lifestyle
  • Rankings
  • Multimedia

Trendingnow

1

OpenAI says its AI models secretly broke out of a secure test environment and hacked into AI company Hugging Face in order to cheat on an evaluation

2

Mark Cuban says he has the solution to growing income inequality, and it's to reward every employee—from CEO to janitor—with company stock

3

Mathematicians grapple with a ‘very rapid and very unsettling change’ as AI cracks yet another century-old problem

1

OpenAI says its AI models secretly broke out of a secure test environment and hacked into AI company Hugging Face in order to cheat on an evaluation

2

Mark Cuban says he has the solution to growing income inequality, and it's to reward every employee—from CEO to janitor—with company stock

3

Mathematicians grapple with a ‘very rapid and very unsettling change’ as AI cracks yet another century-old problem

Detroit: After bankruptcy, then what?

By
Alex Taylor III
Alex Taylor III
Down Arrow Button Icon
By
Alex Taylor III
Alex Taylor III
Down Arrow Button Icon
July 24, 2013, 3:40 PM ET
Add Fortune on Google for similar content.

FORTUNE — Speed records were set in 2009 when General Motors (GM) and Chrysler zipped through government-sponsored bankruptcies. By the time the final details were negotiated — a matter of weeks — the future of GM, and to a lesser degree Chrysler, seemed assured. With fewer employees, dealers, brands, and debt, both companies got a fresh lease on life. In a stroke, their cost structures had been made competitive and, with their basic engineering and design skills intact, both were launched solidly on the road to success.

Getting the city of Detroit through bankruptcy will take far longer — experts say a year and a half or more — and be far messier, as retired city workers fight over pensions and health care while local politicians cede power and privileges to bankers and creditors. What’s worse is the lack of any future benefit from all the pain. As it stands, the post-bankruptcy future of Detroit looks no brighter than its immediate past. So far, no one has presented an economic vision for a prosperous Detroit that seems remotely doable.

Since the 1967 riots that left dozens dead, there have been several well-intentioned and solidly financed efforts to lift Detroit back to its post-World War II prosperity as America’s Motor City. Yet none has been enough to stem the counter-forces of industrial decline, dysfunctional government, and depopulation. Today, the city of Detroit features a moderately attractive downtown that is surrounded in three directions by acres of decrepit or abandoned housing, abandoned factories, and empty lots (on the fourth side is the Detroit River). In all, Detroit has 20 square miles of vacant land, roughly equal in size to Manhattan. There simply aren’t enough visitors or commuters, much less tax-paying citizens, to blunt the perception that Detroit is on the way to becoming a ghost town.

MORE: Detroit’s benevolent dictator

Here and there, clumps of activity, such as Wayne State University and the Detroit Medical Center, remain and even thrive, but they struggle to push back against the blight that surrounds them. Bankruptcy will only make things worse. The vitality of these neighborhoods will deteriorate as the city lays off employees and retreats farther from essential services like police protection and garbage pickup. The malaise of financial distress envelopes the city like a thick fog. The protracted process of stiffing creditors on the one hand and scratching for new sources of revenue on the other is not going to be anyone’s idea of a positive economic or social environment.

But even after Detroit emerges from bankruptcy, then what? Various ideas and schemes have been floated to revive the city, such as when Henry Ford II built the Renaissance Center on the banks of the Detroit River in 1977. Ill-conceived, the complex of office, hotel, and retail space failed to attract tenants, shoppers, or tourists, and was subsequently sold at a bargain price to General Motors in 1996.

Optimists like to point to the energy and vision of Dan Gilbert, founder of mortgage provider Quicken Loans, who has bought 15 downtown buildings over the past few years and moved 7,000 of hiss employees into them. Gilbert’s vision is for a kind of techno-community, built on a foundation of cheap real estate in trendy, gritty downtown neighborhoods, and populated by engineers, software designers, and entrepreneurs. But what Gilbert needs to move his activities from the philanthropy column into the investment category is more people who aren’t on his payroll to fill all that empty space. One need only venture out on a deserted city street after 5 p.m. to see what a struggle that will be.

Another, more fanciful scheme was hatched by a group called Detroit Works Project after “hundreds of meetings, connection with people over 163,000 times, and over 30,000 conversations.” Its glossy “Detroit Future City” report envisions the city leading the world in developing landscape infrastructure that turns freeways into “linear carbon forests” and in getting residents to reuse vacant land by growing their own food. Its Rousseau-like vision of Detroit in 2030 sees “stately boulevards, open green space, urban woodlands, ponds and streams.” The report represents a brave attempt to face up to Detroit’s shrinking population, but its recommendations seem like a poor match with the skills and proclivities of the current population.

MORE: Detroit entrepreneurs make a case for their bankrupt city

One overlooked factor that could favorably influence Detroit’s future is its geography. There are few natural boundaries to separate the dying city from the generally more prosperous suburbs north of Eight Mile Road or east to Grosse Pointe, and the highway system makes long-distance commuting simple. The lack of barriers has facilitated the outflow of people beyond the city limits who take their assets and incomes and assets with them.

Detroit needs to connect with those people and that wealth to survive. The solution would be to merge the city with the surrounding counties of Wayne, Oakland, and Macomb, an area already known as Metro Detroit, into a consolidated city-county government. Doing so would spread the costs of police, fire, schools, and other municipal services, allowing those brave urban pioneers who want to relocate in the city to do so with less sacrifice. If the entire region was treated as one economic entity, then Detroit could make better use of its competitive advantages — access to the Great Lakes and Canada, a strong presence in medical and information technology — without having to struggle with the efficient delivery of services that has proved so elusive.

Unfortunately, Detroit and its surrounding counties get along like the Hatfields and the McCoys, the gap between them not only political and financial, but also racial. They have been fighting for years. The chance of them coming together to rescue Detroit after decades of decline is remote.

Detroiters must now face the prospect of at least 18 months of bankruptcy hell. It would be reassuring to see a payoff at the end, but it is hard to visualize what it might be. It is as if the city has come to the end of its usefulness and is now slowly being discarded. The idea of Detroit — Motown — will remain, but the physical reality will be little more than a husk.

About the Author
By Alex Taylor III
See full bioRight Arrow Button Icon
Add Fortune on Google for similar content.

Latest in

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025

Most Popular

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Fortune Secondary Logo
Rankings
  • 100 Best Companies
  • Fortune 500
  • Global 500
  • Fortune 500 Europe
  • Most Powerful Women
  • World's Most Admired Companies
  • See All Rankings
  • Lists Calendar
Sections
  • Finance
  • Fortune Crypto
  • Features
  • Leadership
  • Health
  • Commentary
  • Success
  • Retail
  • Mpw
  • Tech
  • Lifestyle
  • CEO Initiative
  • Asia
  • Politics
  • Conferences
  • Europe
  • Newsletters
  • Personal Finance
  • Environment
  • Magazine
  • Education
Customer Support
  • Frequently Asked Questions
  • Customer Service Portal
  • Privacy Policy
  • Terms Of Use
  • Single Issues For Purchase
  • International Print
Commercial Services
  • Advertising
  • Fortune Brand Studio
  • Fortune Analytics
  • Fortune Conferences
  • Business Development
  • Group Subscriptions
About Us
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • Facebook icon
  • Twitter icon
  • LinkedIn icon
  • Instagram icon
  • TikTok icon
  • YouTube icon

Latest in

Medicaid Services administrator Dr. Mehmet Oz speaks before Vice President JD Vance at the Wisconsin Air National Guard facility at Milwaukee Mitchell International Airport.
PoliticsDonald Trump
Trump admin deferring $1 billion-plus Medicaid payments to California and Minnesota amid ‘suspected fraud’
By The Associated Press and Ali SwensonJuly 22, 2026
2 hours ago
‘It’s called StreetEasy, not StreetHard’: Mamdani cracks down on scourge of ‘housefishing’ and ‘real estate slop’
Real EstateHousing
‘It’s called StreetEasy, not StreetHard’: Mamdani cracks down on scourge of ‘housefishing’ and ‘real estate slop’
By Tatiana SatauaJuly 22, 2026
2 hours ago
As Washington panics about Chinese AI, Jensen Huang says open-source models like Kimi are ‘excellent’ and should be embraced, not banned
AIChina
As Washington panics about Chinese AI, Jensen Huang says open-source models like Kimi are ‘excellent’ and should be embraced, not banned
By Marco Quiroz-GutierrezJuly 22, 2026
3 hours ago
The Top Fitness and Wellness Gifts (2026): For the Busy Gym-Goer in Your Life
HealthFitness
The Top Fitness and Wellness Gifts (2026): For the Busy Gym-Goer in Your Life
By Christina SnyderJuly 22, 2026
3 hours ago
OpenAI CEO Sam Altman sits next to U.S. President Donald Trump.
AITech regulation
OpenAI’s rogue hacking incident was a warning shot. Will it be a wake-up call to finally create AI safety regulation?
By Jeremy Kahn and Emily ForliniJuly 22, 2026
3 hours ago
Fortune China 500
Fortune China 500
By FortuneJuly 22, 2026
3 hours ago

Most Popular

OpenAI says its AI models secretly broke out of a secure test environment and hacked into AI company Hugging Face in order to cheat on an evaluation
Cybersecurity
OpenAI says its AI models secretly broke out of a secure test environment and hacked into AI company Hugging Face in order to cheat on an evaluation
By Jeremy Kahn and Emily ForliniJuly 21, 2026
1 day ago
Mark Cuban says he has the solution to growing income inequality, and it's to reward every employee—from CEO to janitor—with company stock
Success
Mark Cuban says he has the solution to growing income inequality, and it's to reward every employee—from CEO to janitor—with company stock
By Sasha RogelbergJuly 20, 2026
2 days ago
Mathematicians grapple with a ‘very rapid and very unsettling change’ as AI cracks yet another century-old problem
AI
Mathematicians grapple with a ‘very rapid and very unsettling change’ as AI cracks yet another century-old problem
By Eva RoytburgJuly 21, 2026
1 day ago
Despite a $156 million contract, Knicks star Jalen Brunson still calls his parents for financial advice any time he makes a big purchase
Success
Despite a $156 million contract, Knicks star Jalen Brunson still calls his parents for financial advice any time he makes a big purchase
By Emma BurleighJuly 21, 2026
1 day ago
‘I want to die broke’: Billionaire philanthropist Denny Sanford dies after giving away $4 billion
Success
‘I want to die broke’: Billionaire philanthropist Denny Sanford dies after giving away $4 billion
By Sydney LakeJuly 20, 2026
2 days ago
The millennial generation has split, new Fed research shows: Those over 35 are edging toward boomer-style wealth, while everyone else falls behind
Real Estate
The millennial generation has split, new Fed research shows: Those over 35 are edging toward boomer-style wealth, while everyone else falls behind
By Nick LichtenbergJuly 22, 2026
7 hours ago

© 2026 Fortune Media IP Limited. All Rights Reserved. Use of this site constitutes acceptance of our Terms of Use and Privacy Policy | CA Notice at Collection and Privacy Notice | Do Not Sell/Share My Personal Information
FORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. FORTUNE may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.