Boston Fed study suggests odds of a Detroit turnaround are not good
A Boston Fed study looks at “why some US central cities experienced declines in population, employment, and resident economic well-being during the second half of the twentieth century.” You know, places like Detroit.
Blame suburbanization, sun-seeking, schools, and the downsizing of manufacturing:
1. For one thing, people and employers moved to warmer, sunnier locations. They also moved to less densely settled places, including both younger cities and the outskirts of established cities.
2. Additionally, many manufacturers downsized their workforces or moved their operations to lower-cost locations.
3. The literature also finds that cities with more highly educated populations tended to fare better than cities where a large share of the population either did not finish high school or did not go on to college.
4. Of the forces that influenced population, employment, and economic well-being, the declines and shifts in manufacturing employment are arguably the most relevant for explaining city distress. Among all U.S. central cities, those that were heavily industrial experienced the greatest negative shocks in the second half of the twentieth century. They also are the most likely to have weak economies and low family incomes today.
5. In addition to examining the sources and consequences of central city distress, the studies investigate possible remedies. Their conclusions are sobering: reversing these cities’ trajectories requires making significant civic and financial investments, and comparatively few places have succeeded in making the transition from distressed to revitalized.
James,
Many people are now coming out and repeating in PUBLIC what most of us have pointed towards as the biggest economic risk in the nation – the debt bombs of the largest 100 cites – unfunded liabilities and huge amounts of bond debt spent covering annual shortfalls.
Remember that NYC went BK years ago and the Federal government stepped up and saved them . . the Federal Government has no money to save them now. Obama used almost a $ trillion to bailout pensions and State and local governments with his Stimulus plan – that money is now just gone wasted – instead of financing increased value added manufacturing which would have created more money in the economy.
Poor red States can get by as they tended to not over spend, rich red states will continue to grow due to low costs and fewer regulations. Blue States and large cities will suffer lose of jobs and lose of Conservatives which will move to red States. It will be a very interesting experiment in economic behavior modification caused by the Competition between States for Value added Manufacturing.
“3. The literature also finds that cities with more highly educated populations tended to fare better than cities where a large share of the population either did not finish high school or did not go on to college.”
Well, yeah. As Skakespeare put it, “what is a city but the people?” Detroit has a 47% illiteracy rate. Just how much value can the people there create? There will be no comeback with the current population in place.
when we say civic we mean “government”….”investments”…
worked out great for Cleveland, then they made the idiot a U.S. Representative.
lock……..and if you still can’t compete with prices how is this not also wasted money, gone down the tubes?
” that money is now just gone wasted – instead of financing increased value added manufacturing which would have created more money in the economy.”
if it’s there then it would have already been done. government doesn’t give bad business models some sort of MAGICAL POWER.
“increased value added manufacturing”? And what is this thing you speak of? Are you a politician? what magazine did you get that out of?