Almost Human: How Robots, Race and Neoliberalism killed Detroit and what it Means for You

Detroit can go into bankruptcy, a judge has ruled. Likely it means that workers’ pensions will be at least in part stolen from them.

It is a good occasion to reprint this recent piece on post-industrial decline, robots and the future of capital and labor:

Reprint Edition

The big question is whether Detroit’s bankruptcy and likely further decline is a fluke or whether it tells us something about the dystopia that the United States is becoming. It seems to me that the city’s problems are the difficulties of the country as a whole, especially the issues of deindustrialization, robotification, structural unemployment, the rise of the 1% in gated communities, and the racial divide. The mayor has called on families living in the largely depopulated west of the city to come in toward the center, so that they can be taken care of. It struck me as post-apocalyptic. Sometimes the abandoned neighborhoods accidentally catch fire, and 30 buildings will abruptly go up in smoke.

Detroit_Skyline

Detroit had nearly 2 million inhabitants in its heyday, in the 1950s. When I moved to southeast Michigan in 1984, the city still had over a million. I remember that at the time of the 1990 census, its leaders were eager to keep the status of a million-person city, since there were extra Federal monies for an urban area of that size, and they counted absolutely everyone they could find. They just barely pulled it off. But in 2000 the city fell below a million. In 2010 it was 714,000 or so. Google thinks it is now 706,000. There is no reason to believe that it won’t shrink on down to almost nothing.

The foremost historian of modern Detroit, Thomas J. Sugrue, has explained the city’s decline. First of all, Detroit grew from 400,000 to 1.84 million from 1910-1950 primarily because of the auto industry and the other industries that fed it (machine tools, spare parts, services, etc.) From 1950 until now, two big things happened to ruin the city with regard to industry. The first was robotification. The automation of many processes in the factories led to fewer workers being needed, and produced unemployment. (It was a trick industrial capitalism played on the African-Americans who flocked to Detroit in the 1940s to escape being sharecroppers in Georgia and elsewhere in the deep South, that by the time they got settled the jobs were beginning to disappear). Then, the auto industry began locating elsewhere, along with its support industries, to save money on labor or production costs or to escape regulation.

The refusal of the white population to allow African-American immigrants to integrate produced a strong racial divide and guaranteed inadequate housing and schools to the latter. Throughout the late 1950s and the 1960s, you had substantial white flight, of which the emigration from the city after the 1967 riots was a continuation. The white middle and business classes took their wealth with them to the suburbs, and so hurt the city’s tax base. That decrease in income came on top of the migration of factories. The fewer taxes the city brought in, the worse its services became, and the more people fled. The black middle class began departing in the 1980s and now is mostly gone.

Other observers have suggested other concomitants of the decline, like poor city planning or the inability to attract foreign immigrants in sufficient numbers. I suspect that the decline of Detroit as a port is important somehow to the story (only one of the four old locks at Sault St. Marie lets big ships come down to the lower Great Lakes and therefore to Detroit any more. A new, big [pdf] modern lock is being built to accommodate larger vessels, but it will be a decade before it opens. Some observers point out that Detroit would make sense as a Midwest hub port for international shipping containers if its harbor was expanded and linked by rail to the cities of the region, but I suspect the new lock at the Soo is a prerequisite.

After all these decades of dashed hopes, it is hard for me to take too seriously any assertions that the city is about to turn the corner or that some renewal project is about to succeed. At this point it seems to me a question of whether you retain some of the population that will otherwise leave. I find particularly unlikely the idea that urban farming is part of the solution. It sounds cute, but farmers don’t make nearly as much money as urban industrial workers, which is why they mostly went to the cities. You can’t put money into a city that way.

While other cities have avoided Detroit’s extreme fate, I think the nation as a whole faces some of the intractable problems that the city does, and I don’t think we have a solution for them.

Take robots (and I really just mean highly mechanized and computerized production of commodities). More and more factory work is automated, and advances in computer technology could well make it possible to substantially increase productivity. This rise of the robots violates the deal that the capitalists made with American consumers after the great Depression, which is that they would provide people with well-paying jobs and the workers in turn would buy the commodities the factories produced, in a cycle of consumerism. If the goods can be produced without many workers, and if the workers then end up suffering long-term unemployment (as Detroit does), then who will buy the consumer goods? Capitalism can survive one Detroit, but what if we are heading toward having quite a few of them?

It seems to me that we need to abandon capitalism as production becomes detached from human labor. I think all robot labor should be nationalized and put in the public sector, and all citizens should receive a basic stipend from it. Then, if robots make an automobile, the profits will not go solely to a corporation that owns the robots, but rather to all the citizens. It wouldn’t be practical anyway for the robots to be making things for unemployed, penniless humans. Perhaps we need a 21st century version of ‘from all according to their abilities, to all according to their needs.’

Communally-owned mechanized/ computerized forms of production would also help resolve the problem of increasing income inequality in the United States. The top 1% is now taking home 20% of the national income each month, up from 10% a few decades ago. The 1% did a special number on southeast Michigan with its derivatives and unregulated mortgage markets; the 2008 crash hit the region hard, and it had already been being hit hard. The Detroit area is a prime example of the blight that comes from having extreme wealth (Bloomfield Hills, Grosse Pointe) and extreme poverty (most of Detroit) co-existing in an urban metropolitan area. It doesn’t work. The wealthy have no city to play in, and the city does not have the ability to tax or benefit from the local wealthy in the suburbs. These problems are exacerbated by de facto racial segregation, such that African-Americans are many times more likely to be unemployed than are whites, and to live in urban blight rather than in nice suburbs.

The crisis of capitalism is being delayed in part because of the rise of Asia and the emergence of new consumer markets in places with rapidly growing populations. American corporations have relocated to those places with increasing numbers of people and cheap labor, leaving working communities like Detroiters abandoned and idle. US companies are making goods in Vietnam to sell to middle class Chinese and Indians. But the world population will level off in 2050 and probably will decline thereafter. At that point, consumerism will have reached its limits, since there will be fewer consumers every year thereafter. (There is also the problem that classical 1940s and 1950s consumerism is environmentally unsustainable).

With robot labor, cheap wind and solar power, and a shrinking global population, post-2050 human beings could have universally high standards of living. They could put their energies into software creation, biotech, and artistic creativity, which are all sustainable. The stipend generated by robot labor would be a basic income for everyone, but they’d all be free to see if they could generate further income from entrepreneurship or creativity. And that everyone had a basic level of income would ensure that there were buyers for the extra goods or services. This future will depend on something like robot communalism, and an abandonment of racism, so that all members of the commune are equal and integrated into new, sustainable urban spaces.

Insisting on a 19th century political economy like barracuda capitalism in the face of the rise of mechanized smart labor and the decline of human-based industry produces Detroit. Racial segregation and prejudice produces Detroit. Shrinking and starving government and cutting services while forcing workers to work for ever shrinking wages (or even forcing them out of the labor market altogether) produces Detroit. In essence, Detroit is the natural outgrowth of the main principles of today’s Tea Party-dominated Republican Party. It doesn’t work, and isn’t the future.

The future is not Detroit or today’s GOP-dominated state legislature in Lansing. It is Something Else. Michigan’s slow, painful decline is trying to tell us something, that robots, race and unhealthy forms of globalization are death to cities under robber baron rules. We need new rules.

28 Responses

  1. Jason Benlevi

    It was almost entirely race. The factories recruited black people from the South to work during WW II. Then, postwar, white flight of car factories to the suburbs, underfunded public transit and housing convents that left black people stuck in the inner city. Jobs gone. No social mobility. Declining tax base.

  2. Rafik Khoury

    Detroit was a big Target for Neocons, Wall Street & Bankers. It is the road map to Bankrupt other large Cities in the USA.

  3. Jason Benlevi

    Not really, the wheels were put in motion by local forces – the racist families of Gross Pointe didn’t need any outside help to financially rape that city and cast it into the flames while they putt away at the country clubs.

  4. Jason Benlevi

    It was over for Detroit in 1965. Long before the current wave of Wall Street thieves and Neocons…but you are right, Chicago does have Wall Street breathing down its neck. First warning sign was when they used JP MOrgan as a go between to sell every municipal parking space in the city to Abu Dhabi.

  5. As suggested, there are several important reasons for Detroit’s decline. Nevertheless, there are two very important, and often overlooked, reasons that led to the precipitous decline of Detroit relative to other cities that were in the “Rust Belt” and came back revitalized, such as Pittsburgh today.

    Detroit’s decline began long before robotics began seriously displacing workers in the auto industry. The 1967 race riots in Detroit were among the worst in the nation and destroyed whole areas, primarily where the Black community was living. Whatever the reasons that sparked the riots, it was not smart to destroy one’s own community and the supporting infrastructure that sustained it. In some sense, Detroit never recovered from that trauma.

    The auto industry itself–both the United Auto Workers union and the automobile companies–were in large part responsible for the decline of the industry in Detroit. In the 1970s and 1980s, they cut “sweetheart” contract deals that resulted in workers receiving a package of salary and benefits that totaled $71.00 per hour. They literally priced themselves out of the market, and the Japanese took advantage of it by outselling Detroit with their reliable and economically-priced Toyotas and Hondas. Later, Japanese companies further undercut Detroit by locating plants in places like Kentucky, creating jobs with a salary and benefits package in the neighborhood of $45.00 per hour, hardly chump change.

    I do not think Detroit represents in microcosm the “dystopia America is becoming.” Former Rust Belt cities like Pittsburgh have shown that with planning and foresight, cities can turn themselves around and flourish. It takes both vision and planning, however, and both seem to be lacking in Detroit.

  6. A nice idea with implementation difficulties. What is a robot?
    Cooperative businesses, however, have a great future. See Zingerman’s businesses in Ann Arbor, or the Mondragon businesses in Spain.

    • I was a resident of Detroit during the 1960s.

      The John Hersey book “Algiers Motel Incident” is an excellent description of that incident and the general history of the 1967 riots and the underlying causes.

      U.S. Army troops were transported from Selfridge Air National Guard base in convoy and decamped at the Michigan State Fairgrounds in Detroit in 1967 during the riots – I lived two blocks away from the fairgrounds. One of the chief causes of the riots was police repression of black residents. The city was racially polarized with blacks and whites largely residing in separate neighborhoods. Despite the fact blacks were about 45% of the city’s population, only one City Council member – Nicholas Hood -was black. The police department in Detroit had very, very few minorities on it. Blockbusting by real estate brokerages broke up the white neighborhoods and the populations of the suburbs soared due to white flight.

      Detroit had rioting in April of 1968 immediately after the MLK assassination.

      Detroit was perceived to be on the verge of rioting in 1993 as two white officers had their murder trials conclude. Their jury convictions defused a possible riot such as that which had occurred in Los Angeles a year earlier after the state court acquittals in the Rodney King case.

      The two-term Kwame Kilpatrick mayoral era was a disaster with widespead corruption with over 30 persons under federal indictment and many others forced to resign due to scandal. Kilpatrick received a 28-year prison sentence; he was also convicted of assaulting a Detroit police officer. His father was convicted of income tax charges, his mom voted out of office as a U.S. House member. Other family members faced legal actions arising out of the myriad of scandals that engulfed Mayor Kilpatrick and his inside circle.

      The key movers and shakers that currently control Detroit are all outsiders. Mike Duggan who just got elected as mayor of Detroit moved in this year from the nearly all-white suburb of Livonia. Governor Rick Snyder, who appointed the “emergency financial manager”, is from Ann Arbor, as is U.S. Bankruptcy Judge Steven W. Rhodes, who presides over the Chapter 9 bankruptcy, as is U.S. Attorney Barbara McQuade. Ann Arbor is a college town about 40 miles from downtown Detroit in a separate county.

      Detroit just elected its first Hispanic City Council member in its history as well as its first white City Council member in many years.
      Detroit’s population is about 80% black, 5% Hispanic, and another 5% other minorities. Although there are grumblings, there has been broad-based support from the black community to allow outside experts come in and re-organize a city that is in dire straits. Race relations are about the best I have seen in Detroit’s history.

  7. I find the robot assertion a bit unsupported. I am sure that they exist but there have been reports that refute that they have displaced a large portion of the work force. e. g. link to cepr.net

    Please provide some information to support this assertion. It would seem to me that the various “free trade” agreements would play a much bigger role then robots. I say this as building out of US discounts more than just labor.

    X

  8. Another very important issue in Detroit, and the rest of the nations economic decline, is our trade policies. We need to abandon the free trade treaties and re-establish tariffs to compensate for the different costs of labor between dometic and imported products.

    Another Detroit decline issue was the poor quality of auto product that Detroit produced in the mid to late 70′s, and their slow response to higher quality imports. I blame executive management for this failure.

  9. “It’s only a movie,” actually a franchise as Hollywood calls it, but people wanting clues about Dystroit might go back and enjoy (?) the “Robocop” series.. Not uniformly good theater, but Omni Consumer Products sure looks familiar, as do its principals (and principles, if you can call them that.)

    “In the near future, Detroit, Michigan is on the verge of collapse due to financial ruin and overrun by crime. The city has signed a deal with the mega-corporation Omni Consumer Products (OCP) to allow them to run the police force, in exchange for allowing OCP to demolish “Old Detroit” and construct a high-end utopia called “Delta City” to be managed by OCP. This moves angers the police officers as they are now beholden to OCP, and threaten to strike. OCP evaluates other options for law enforcement. OCP senior president Dick Jones (Ronny Cox) offers the ED-209 enforcement droid, but when it kills a board member during a demonstration, the OCP chairman (Dan O’Herlihy) decides to go with the experimental cyborg design titled “Robocop” as suggested by the younger Bob Morton (Miguel Ferrer), infuriating Jones….”

    link to en.wikipedia.org

    It’s only a movie, of course. So is “Soylent Green…”

  10. I think the details of our demise are complex and far reaching. For me, we were greedy, arrogant and entitled from the get go. We created a mythology without a shred of truth in it. In one way or another we annihilated the people who were here and rightfully owned the resources. We imported slave and semi-slave labor from all over the world selling them on the idea they would become rich/famous by coming to America and some (very few) did. All others were inferior and had been put here, by god, for our amusement. After WWII we had the world at our feet and took full advantage of it. Throughout it all, the masses dreamed of becoming rich. In the end we simply tried to use credit cards to obtain all the trappings of riches. And now it’s all ending. In fact, the end began long ago. All we have left is the lies we tell ourselves of how wonderful/god chosen we are and, of course, blaming everyone but ourselves.

  11. Very good article raising one of the great issues facing the US and the rest of the West and ultimately the world. Robotic is one of the great boons and one of the greatest challenges to humanity. The long delayed promise of producing more with less labor is fast becoming a reality. Capitalism, as we know it, cannot continue. More production capacity and fewer consumers is recipe for disaster. The suggestion of paid consumers is one possible response. The national GDP , income and wealth may very well increase, but the increasing maldistribution must be addressed.

  12. Juan, there is a deep parallel with the collapse of livelihood in the USA and the collapse of the Ottoman Empire. You have two states that are deep in debt due to wars. Through laws that allow the rich to gobble up public resources–in Detroit, public utilities, in Palestine and Egypt the land–the poor get disenfranchised. Eventually you have settlers gobbling the land (gated communities/settlers) and a mass of poverty with no public services. US schools and infrastructure are going the way of Arab dictatorships like Jordan and Egypt.

    • Also, the Ottomans failed to industrialize, whereas the Americans allowed politicians and corporations to ship their industries abroad.

    • I remember reading one book about the Ottoman Empire and they brought forward the idea that they started to collapse when the railroad and telegraph were introduced. These technologies then allowed a centralized government to rule directly, instead of through distant appointed local leaders.

  13. The auto industry made Detroit when they turned out reasonably priced cars that ran well. Then the same auto industry destroyed Detroit when they began making expensive junk and called them new cars.

    Thank goodness, Japan came to the rescue of the rest of America.

  14. Good summation of the problems, and I share your view that modern technology and automation really is historically and economically unprecedented. It really is going to require a rethinking of economic distribution that I hope works out along the lines you drew. However, this direction would not be without really big problems that might not be overcome:

    1. Societal reorganization of this scale hasn’t happened in history without intense violence and upheaval. Granted, automated production is unprecedented in history, but the more wealth that’s accumulated by elites, the harder they’ll fight to keep it and the more they can spread that wealth selectively to empower their position. (Arguably happening already for decades.) What kind of civil disorder would we undergo to get to the end point? It wouldn’t be pretty.

    2. We’re in a race against environmental catastrophe, as you noted, with sustainable technology as the only horse in the stable. Your own figures project a few decades out for these types of positive societal changes, but those same decades are when we’re forecast to see the biggest impact on sea levels, drought, and all the other bad stuff that could break the systems for civilization.

    3. To get capitalist on it, will we continue to see improvements in technology and production when the rewards don’t go to particular drivers of those improvements? Of course, if you get self-improving technology (highly likely), that changes the nature of this issue.

  15. I’ve held a similar view since the early 80s even as computers were just becoming household ‘robots’ doing precisely as commanded without the notion of enslaving any humans. Robots are responsible for the disappearing economics in communities that are home to companies that ‘downsize’ in favour of robotics. A robot can produce 24/7 but it does not spend its ‘wages’ in the community or contribute income tax proportionate to the capital it generates like the rest of us do. This is where the economy ultimately ‘went’… The promise of the future was to mechanize and free the human race to pursue loftier pursuits in knowledge, self-education, the arts, science, history etc. Tax the robots and fund anything that is culturally uplifting and better suited to human aspirations in the 21st century!

  16. Interesting comment by Foraker about coop model for community owned robots. That is a model that could actually work because like all coops it embraces the principle of people and community before profits. Humanity needs a bit of cooperative thinking today. In my recently published book: The Experience Design BLUEPRINT: Recipes for Creating Happier Customers and Healthier Organizations, I’ve dedicated an entire chapter to the subject of work. In Chapter 14: The World of Work Has Changed, I talk about a new economic reality, the unintended byproducts, and the great misalignment between talent and those that claim a shortage of it. But, aside from a sobering reality I offer a path forward for businesses of all sizes, government policy makers, co-working spaces, and even the unemployed and underemployed. I wrote it so that we can begin a new conversation for a new normal.

  17. I like your ideas about taxing or stipending incomes or profits primarily enabled by machines to go to the public good. Why not tax these profits and give them to the poor and underclass? It would only go back into the pockets of the wealthy but some of it would drive new business and support existing smaller business.

  18. I think we should avoid political notions of redistribution of wealth and simply clarify the formula for downsizing so that companies understand that machines that replace ‘man’ hours of labour should still be paying income tax at the same rate of income generated as humans pay. Companies can still benefit from the increased production efficiency. The point is that the promise of the future was to free humans from the mundane and laborious, and the dangerous to pursue more culturally enriching activities in the arts, sciences and absorbing knowledge in general. Redefining how we value the work we do in these fields of endeavour is part of where the world wide web becomes an excellent way to quantify what each of us is contributing to the archive of human information we share. e.g. For the sake of argument, in a discussion like this, a penny per word might be the going rate for a discussion on a robotic income tax. If everything we say and do on the web adds to our cultural enrichment without value judgement then we can erase the old ‘sweaty work ethic’ with a new notion of what work is in the 21st century. We are certainly ‘putting in the hours’ even if we are only absorbing all this sudden access to knowledge. But how are we compensated without a mechanism in place to deal with energy exchange? Robots should pay income tax on their productivity just like everyone else!

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