Detroit was once the greatest city of the modern world. Automobiles were the cutting edge of technology in the first half of the twentieth century. Talent and genius flocked to Detroit. Innovators in engineering, technology, design, finance, marketing, and management created a concentration of economic dynamism and creativity unlike anything the world had yet seen. Detroit was the Silicon Valley of its day, except its products were made of tangible metal, rubber, and glass. The auto industry transformed America into a land of mobility and personal freedom beyond the dreams of earlier generations. Henry Ford said, “History is bunk.” He meant the old limits could be blown away, and ordinary people could have a better life than they had ever dreamed of before. Ford, Alfred Sloan of General Motors, Walter Chrysler, and countless thousands of people in and around Detroit—and millions of suppliers and customers all over the world—made that happen. They made modern America.
Detroit was where the action was. Detroit was the future…
But, somehow, it all went wrong.
Detroit did not simply decline. Detroit has been destroyed. Detroit had 1.8 million people at its peak in 1950. Now it has 700,000, and 250,000 have left since 2000. “In 1960, Detroit had the highest per capita income in the U.S.; today, it’s the poorest of our large cities.” Detroit has literally been reduced to ruins.
There is one clear lesson in this tragedy, for anyone who is willing to face the facts:
Detroit was destroyed by bad political choices and bad public policy.
Irresponsible unions, both public and private sector, placed impossible burdens on business and on taxpayers. Liberal-progressive policies, including high taxes, crushed the economy. Detroit is one of the few cities with its own income and corporate taxes, yet spending always exceeded revenue. As the economy declined, Detroit’s government continued to increase taxes, creating an economic downward spiral, imposing higher and higher tax rates on a shriveling base of taxpayers. And the corruption and incompetence of Detroit’s city government are legendary.
Attempts to blame capitalism, or Japanese imports, or bad luck, for the fall of Detroit, are excuses and lies. Why does anyone want to conceal the facts? Because the same bad choices and bad policies that destroyed Detroit are still being advocated and adopted all over America. And the politicians who are promoting these same destructive policies don’t want anyone to know that they are not offering progress but debt, depopulation, disappearing businesses, poverty, ruin and bankruptcy. Illinois is one of the worst examples. The political class in Springfield does not want Illinois voters to hear about the lessons of Detroit.
But the parallels between the once great and now bankrupt city of Detroit and the once great but now disintegrating state of Illinois cannot be honestly denied.
Illinois has enormous, unfunded pension obligations to its state employees. Illinois has the worst bond rating in the nation. Illinois is shedding people and businesses. Illinois is renowned for its corrupt and wasteful government. Government spending far exceeds revenue. Illinois is trying to respond to the ongoing crisis by piling on more taxes, on top of an already far-too-high tax burden.
Illinois is on the same path Detroit went down.
Illinois has not yet reached the end of the road. We don’t have most of downtown Chicago boarded-up. We haven’t lost over a quarter of our population in the last decade. There is still a lot of strength in Illinois. But it is being squandered, and the proposals floating around in Springfield are just more of the same poison that got us into our current crisis.
Even world-class communities can wreck themselves, if the voters let politicians go on, year after year, imposing bad and destructive policies, until there is nothing left but crumbling buildings, weeds, trash, poor and abandoned people, fading memories of greatness, a proud history wasted, and the sad knowledge that it didn’t have to happen this way.
It is long past time for serious reform in Illinois. A necessary first step is real pension reform. With that essential building block in place, the reconstruction and recovery of Illinois can begin in earnest.
Let’s start now. There is no time to waste.
Otherwise, the future is Detroit.