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Detroit: The Triumph of Progressive Public Policy
Capitol Confidential ^ | 2/14/2012 | Jarrett Skorup

Posted on 02/14/2012 6:04:39 AM PST by MichCapCon

Imagine a city where all the major economic planks of the statist or "progressive" platform have been enacted:

*A "living wage" ordinance, far above the federal minimum wage, for all public employees and private contractors. *A school system that spends significantly more per pupil than the national average. *A powerful school employee union that militantly defends the exceptional pay, benefits and job security it has won for its members. *Other government employee unions that do the same for their members. *A tax system that aggressively redistributes income from businesses and the wealthy to the poor and to government bureaucracies.

Would this be a shining city on a hill, exciting the admiration of all? We don't have to guess, because there is such a city right here in our state: Detroit

Detroit has been dubbed "the most liberal city in America" and each of these "progressive" policies is alive and well there. How have they worked out?

In 1950, Detroit was the wealthiest city in America on a per capita income basis. Today, the Census Bureau reports that it is the nation's 2nd poorest major city, just "edging out" Cleveland.

Could it be pure coincidence that the decline occurred over the same period in which union power, the city government bureaucracy, taxes and business regulations all multiplied? While correlation is not causation, it is striking that the decline in per capita income is exactly what classical economists predict would occur when wage controls are imposed and taxes are increased.

Specifically, "price theory" predicts that artificially high business costs caused by excessive regulation and above-market labor compensation rates imposed by so-called "living wages" will lead to an increase in unemployment. Detroit's minimum wage is more than $2 above the federal minimum wage; and pressure groups are pushing for more. Additionally, any company contracting with the city must pay its employees $11.03 an hour if they offer benefits or $13.78 an hour if they do not.

Such high wage mandates are especially hard on individuals with a poor education and low skills. If struggling and heavily taxed businesses cannot pay such high wages, then they are more selective about the few workers they do hire or simply go out of business altogether. Those who have promulgated these polices may be well-intentioned, but mainstream economists have warned for decades that such policies were very likely to bring about the abject poverty and unemployment that characterize Detroit today. The city has the highest unemployment rate among all large U.S. cities.

A similar pattern has played out in public education. It is now conventional wisdom among the political class that higher pay for teachers and increased spending per student lead to improvements in teacher quality and student performance -— Detroit Public Schools strongly suggests that this theory must be rejected. It has chronically underperformed state averages, yet reforms are vehemently opposed by the system's powerful school employee union.

At the same time that union, the Detroit Federation of Teachers, has won rich salary and benefits packages for its members. Detroit spends one of the highests amounts of money per student nationwide and the district's spending per pupil is eighth highest out of Michigan's 551 school districts. For all that, by almost any measure Detroit schools have for decades failed their students: test scores, safety, drop out rates, etc. Detroit's public school students perform among the lowest in the state. On a 2009 test for urban districts from the U.S. Department of Education, DPS students performed "barely above what one would expect simply by chance, as if the kids simply guessed at the answers."

In the private sector such failure would result in mass firings for unsatisfactory performance. No doubt such a response would be condemned by the progressives who support the school employee unions that have made similar actions impossible in their institutions, and have opposed major transformation at every turn.

For example, in 2003 philanthropist Bob Thompson offered $200 million to build 15 charter public schools in the city in which he would guarantee a 90 percent graduation rate. In response, the DFT balked because charter schools are not unionized. The outcome was that the union jobs trumped better outcomes for children.

People vote with their feet, and all the above suggests why, over the past decade, DPS has lost about 10,000 students each year to charter, independent and suburban schools.

Of course it would be unfair to place all the blame for the city's decline on public employee unions. Detroit is home to the Big Three, whose contracts with their own powerful unions provided the model for those public employee arrangements. The UAW successfully extracted wages and benefits estimated at $73 per hour before the recent shake-ups began.

This is about $25 more per hour than the amount foreign-owned U.S. auto manufacturing plants pay their non-unionized American workers. Due to this disparity, Japanese car companies earn some $1,000 to $2,000 more on each car sold than their American counterparts. The outcome has been a relentless loss of market share that, among other things, has devastated the economic engine that once powered Motor City prosperity.

In addition to being a model of progressive economic, labor and education policy, Detroit is also a case study in welfare statism. Tom Bray, former editorial page editor for The Detroit News, has made the following observation:

"Detroit, remember, was going to be the 'Model City' of Lyndon Johnson's Great Society, the shining example of what the 'fairness' of the welfare state can produce. Billions of dollars later, Detroit instead has become the model of everything that can go wrong when you hook people on the idea of something for nothing - a once-middle class city of nearly 2 million that is now a poverty-stricken city of less than 900,000."

Today, Detroit is down 25 percent over the past 10 years; to just over 700,000 and dropping fast.

Progressives will complain that this portrait oversimplifies the factors involved in a great city's decline. Perhaps it does, but with this question in mind: At what point does the weight of evidence and logic make it impossible to avoid concluding that in the case of Detroit, correlation is causation?


TOPICS: Government; Politics
KEYWORDS: detroit

1 posted on 02/14/2012 6:04:43 AM PST by MichCapCon
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To: MichCapCon
The Greeks should study the history of Detroit.

Most animals don't foul their own nest.

2 posted on 02/14/2012 6:10:15 AM PST by Paladin2
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To: MichCapCon

no, no, don’t worry: Eastwood tells us that Detroit is back!


3 posted on 02/14/2012 6:11:14 AM PST by ConservativeDude
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To: MichCapCon
Good read. And yet Americans still vote for Liberals and liberal policies that wrecked not only Detroit, but Cleveland, Oakland, and a host of other cities. Then, when they have demolished a city, the Liberals move to a city run by Conservatives and then the process of destruction begins all over again, albeit more slowly.
4 posted on 02/14/2012 6:12:13 AM PST by Obadiah (Why do they put Braille dots on the keypad of the drive-up ATMs?)
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To: MichCapCon
See for yourself in this Steven Crowder video: Detroit in Ruins.
5 posted on 02/14/2012 6:19:15 AM PST by Maceman (Liberals' only problem with American slavery is that the slaves were privately owned.)
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To: MichCapCon

Readers of this can’t cry racism; no mention of demographics at all.


6 posted on 02/14/2012 6:20:44 AM PST by JimRed (Excising a cancer before it kills us waters the Tree of Liberty! TERM LIMITS, NOW AND FOREVER!)
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To: MichCapCon

bump


7 posted on 02/14/2012 6:36:10 AM PST by GeronL (The Right to Life came before the Right to Pursue Happiness)
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To: MichCapCon

Democrats - ruin it and run away.


8 posted on 02/14/2012 6:38:00 AM PST by blueunicorn6 ("A crack shot and a good dancer")
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To: MichCapCon
“At what point does the weight of evidence and logic make it impossible to avoid concluding that in the case of Detroit, correlation is causation?”

Remember, the Liberal “progressive” mindset is always set to DENIAL. Never ask the question whether the intended goal was achieved (or even if it was attainable), it's all about good feelings and the appearance of good works. Performance metrics are never mentioned and discouraged in the harshest ways possible.

The idiots running Detroit will NEVER learn and so Detroit must die in order to be reborn. Whether or not it can ever be reborn is another matter. It will never happen if attitudes and the current reasons for the destruction of Detroit do not change. The main thing is for the State of Michigan to allow Detroit to fail and not get sucked into oblivion along with the whirlpool called Detroit.

9 posted on 02/14/2012 6:39:17 AM PST by MasterGunner01 (11)
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To: MichCapCon

bump


10 posted on 02/14/2012 6:42:42 AM PST by GeronL (The Right to Life came before the Right to Pursue Happiness)
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To: MasterGunner01

Once the left has power, dissent is not tolerated.


11 posted on 02/14/2012 6:44:11 AM PST by GeronL (The Right to Life came before the Right to Pursue Happiness)
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To: Obadiah

These worthless LIBs are the termites attacking civilization. Relentless, purposeful, destructive.


12 posted on 02/14/2012 6:50:04 AM PST by hal ogen (1st Amendment or Reeducation Camp?)
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To: MichCapCon

Detroit is considered “The Most Liberal City in America!”. Gary, In., is the 2nd most liberal.

I wonder why our lib friends don’t move to these paradises of Socialist Rule, enmass?


13 posted on 02/14/2012 6:56:22 AM PST by tcrlaf (Election 2012: THE RAPTURE OF THE DEMOCRATS)
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To: All
The ONLY way Detroit goes forward is post these signs on every road, street, highway coming into the city...

Photobucket

14 posted on 02/14/2012 6:58:13 AM PST by harpu ( "...it's better to be hated for who you are than loved for someone you're not!")
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To: GeronL
Exactly. All the more reason to isolate the cancer and let the disease consume the host. Do not let the perps who are the cause escape to infect healthy areas of the economy. Let the disease called Detroit implode from its vile excesses.
15 posted on 02/14/2012 7:06:44 AM PST by MasterGunner01 (11)
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To: JimRed

Us here in the Detroit ‘burbs are watching as it only a matter of weeks now before the State of Michigan takes over Detroit with the new Emergency Manager law.

When that happens it becomes racist!


16 posted on 02/14/2012 7:14:17 AM PST by quantim (Victory is not relative, it is absolute.)
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To: MichCapCon

17 posted on 02/14/2012 7:30:22 AM PST by Paine in the Neck (Where's he getting these ideas? He's not smart enough to be that stupid all by himself.)
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To: MichCapCon
Scientists have spent hundreds of billions of dollars studying the effects of CO2 increasing its share of the atmosphere 0.01% over 100 years, but there is not one computer model to calculate the effects of taxes increasing 6% over a period of 1 year. Why is that?
18 posted on 02/14/2012 8:00:47 AM PST by Reeses
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To: MasterGunner01
Whether or not it can ever be reborn is another matter

Considering Detroit has been selecting its population for the laziest, stupidist, most ignorant, and above all the most dependent, and having run off all of the hard working and innovative, I'd have to say a rebirth is highly unlikely. When the bulk of you population is hard core welfare, and has a bone deep sense of entitlement, no skill and no desire to do anythin except drink, do drugs and screw out more welfare babies you have no labor pool. If you combine this with punishing any innovation or attempts to legitimately make money by taxation and regulation, then all you'll get is more lazy parasites thinking that the rest of the country owes them something. For the most part these people can't be salvaged.

Poverty is a lifestyle choice.

19 posted on 02/14/2012 8:12:08 AM PST by from occupied ga (Your government is your most dangerous enemy)
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To: Obadiah

“And yet Americans still vote for Liberals and liberal policies that wrecked not only Detroit, but Cleveland, Oakland, and a host of other cities.”

You succinctly capture one of the core tenets of why conservatives are smart, and conservative, and why leftists are addicted to their own weaknesses. Place a table in front of a drug addict. On the table place just enough drugs to get them through a few days on the way to their ultimate destruction and also place a package marked “health and freedom from addiction”. The druggy will take the drugs every time, just like the leftist will almost always take the meager gov’t handout with its eternal chains.


20 posted on 02/14/2012 8:16:55 AM PST by iacovatx (If you must lie to recruit to your cause, you are fighting for the wrong side.)
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To: Obadiah

“And yet Americans still vote for Liberals and liberal policies that wrecked not only Detroit, but Cleveland, Oakland, and a host of other cities.”

You succinctly capture one of the core tenets of why conservatives are smart, and conservative, and why leftists are addicted to their own weaknesses. Place a table in front of a drug addict. On the table place just enough drugs to get them through a few days on the way to their ultimate destruction and also place a package marked “health and freedom from addiction”. The druggy will take the drugs every time, just like the leftist will almost always take the meager gov’t handout with its eternal chains.


21 posted on 02/14/2012 8:17:15 AM PST by iacovatx (If you must lie to recruit to your cause, you are fighting for the wrong side.)
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To: Obadiah

“And yet Americans still vote for Liberals and liberal policies that wrecked not only Detroit, but Cleveland, Oakland, and a host of other cities.”

You succinctly capture one of the core tenets of why conservatives are smart, and conservative, and why leftists are addicted to their own weaknesses. Place a table in front of a drug addict. On the table place just enough drugs to get them through a few days on the way to their ultimate destruction and also place a package marked “health and freedom from addiction”. The druggy will take the drugs every time, just like the leftist will almost always take the meager gov’t handout with its eternal chains.


22 posted on 02/14/2012 8:17:29 AM PST by iacovatx (If you must lie to recruit to your cause, you are fighting for the wrong side.)
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To: MichCapCon

later


23 posted on 02/14/2012 8:30:46 AM PST by wjcsux ("In a time of universal deceit, telling the truth becomes a revolutionary act." - George Orwell)
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