Stewart Acuff

Jul 31

Detroit: The Lack of Industrial Policy

The Radical Right-wing is licking their chops over the economic and financial failure of Detroit, which was at one time perhaps the greatest industrial city in the world.

Lavish pensions and much too powerful unions destroyed Detroit they crow on Fox News.

Really, the average pension in Detroit is $19,000 a year. Hardly lavish. And the unions made it the greatest industrial city in the world, as did the tens of thousands of once poor people who came to the city in the 40′s and 50′s, to build first the war material without which Nazism, fascism, and Japanese Imperialism could not have been beaten. Then those same once poor people stayed in Detroit to create the core of the building of the American middle class – hardly a bad thing.

No, Detroit hollowed out because we live in a country with no Industrial Policy. We live in a country that almost allowed the entire automobile industry to go under – the industry that was once part of the definition of America with its boundless open spaces and endless highways.

For 45 years, our domestic automobile industry faltered and slowly failed, and foreign imports slowly filled our streets and roads. The product created by our automobile industry also faltered.

And we steadfastly refused to adopt a national industrial policy that would bring together management, unions, and our government to develop a strategy to save our great industries and wealth creating manufacturing.

That kind of industrial policy is exactly why Germany has exports that greatly outweigh imports and a robust manufacturing sector.

And in the 90′s, we actually accelerated the destruction of our manufacturing sector with trade deals like NAFTA and Permanent Normal Trade Relations with China. Increasingly as a result, global corporations moved operations everywhere except here at home. Our labor movement declined and so did our middle class.

And Detroit lost its economic base and then its population. Eventually, Detroit lost two-thirds of its population.

Show me any enterprise that can lose two-thirds of its financial base and survive.

 

 

Image: Western part of the abandoned Packard Automotive Plant in Detroit, Michigan.

Image source: Albert duce via Wikimedia Commons

This file is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported license.

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