Motown, Motoring Down

Hello Detroit auto workers, let me thank you for your time
You work a forty hour week for a livin', just to send it on down the line

Hello Pittsburgh steel mill workers, let me thank you for your time
You work a forty hour week for a livin', just to send it on down the line

--40 Hour Week, Alabama (1985)


Well we're living here in Allentown
And they're closing all the factories down
Out in Bethlehem they're killing time
Filling out forms
Standing in line.

Well our fathers fought the Second World War
Spent their weekends on the Jersey Shore

Every child had a pretty good shot
To get at least as far as their old man got.
Something happened on the way to that place
They threw an American flag in our face

--Allentown, Billy Joel (1985)

____________

It was with grim irony I chose Alabama's lyrics. Can you imagine the GWB of photo-op fame actually looking those people in the eye today? Some thanks.

Forbes sees Detroit as one of its prognosticated Ghost Cities of 2100.

"Detroit's population has fallen by around a third since 1950 and now equals about 950,000. It is expected to shrink slowly but steadily until at least 2030; unemployment inside the city is more than 10%. If trends hold, Detroit will be altered beyond recognition by 2100."

Bill Bonner, in The Life and Death of Great Cities, writes of Detroit as an incidence of national betrayal.

It is a provocative piece, comparing Detroit, our metropolis on the descent, with the once- thriving Chinese metropolis of Kaifeng which, 1000 years ago, was the capital of the Song Dynasty, with more than a million people. "At the time, Detroit didn’t even exist."

In Motor City, "even during wartime, the assembly lines didn't slack off - instead, they sped up, working around the clock to provide trucks, jeeps, tanks, to armies all over the world. War or peace, everyone seemed to want more and more vehicles. How could you go wrong buying property in the city that made them?"

"If you believe that, you should get on a plane to Detroit now. Whole skyscrapers change hands for less than the price of a 3-bedroom apartment in Mayfair. The 65-story David Stott building, for example, is on the market for $3.5 million. For less than a million you can buy a 12,000 square foot Italian renaissance-style mansion, complete with an intricate, hand-carved walnut main staircase and imported wood paneling throughout.

"That may seem like a bargain," says a CNBC reporter, "considering the 1915 limestone house sits on over 2 acres and is just 3 miles from the city center. But then again, this is Detroit, Michigan."

"Kaifeng is a now a small, grimy, poor city," and in its stead are financial capitals like NYC and London. In 2007, the new "money-shuffling commerce" is booming.

"All over the world, companies are getting set up, financed, bought out, refinanced, IPO'ed, taken private, merged, acquired, re-IPOed and leveraged in more ways than you can count. It will be a cold day in Hell when the Chinese can compete in this industry."

For the more traditional investors, Bonner suggests they might do better in Liuzhou, China, where GM is producing its new Wuling Sunshine mini-van. "In 2002, China made a million cars and trucks. By 2020, it's expected to produce 15 million units, more than the United States. How can Detroit stage a comeback with that kind of competition?"

For now, "London and New York are on top of the world - just like Detroit once was. Just like Kaifeng once was. Prices can only go up, right?"

--by Lisa