Thanks to a billionaire, Detroit is new and improved – but for whom?

[Canadian Visitor]

Feature article in today's Globe and Mail w/the headline above.

Discusses the enormous impact of Dan Gilbert; but also the residual issues of poverty/inequality in Detroit.

https://www.theglobeandmail.com/worl...-but-for-whom/

[Richard]

The taxpayers made the choice to invest the original $250 million in order to bring Mr Gilbert to the city.

The taxpayers decided to put strong leadership in place.

The taxpayers decided thier city was not going to die and they were not giving up on it.

A tax base is needed in order to generate funds that support programs and poverty and income inequality is in every corner of the world.

No matter how hard they try nobody has been able to find a solution for it in over 2000 years.

The Amazon charade showed that there are lots of cities that would love to have that opportunity of hope,he’s one guy doing what he can and I am sure if he had a magic wand he would have used it already.

People love to use Califorinia in arguments about how it is the richest economy but yet it also has poverty and income inequality with the added bonus of 60,000 homeless sleeping in the streets.

The whole narrative is about income inequality and poverty and it is not inclusive to Detroit or its billionaires and it will never be fixed or resolved in Detroit.

So why use it as a tool?

The globe and mail is a Canadian newspaper,they have already solved poverty and income inequality in Canada ?

[1953]

Mr. Gilbert has been a great benefactor to this city. I am thankful for his efforts. He is not personally responsible for the fact that Detroit became a concentrated center of poverty over decades, but he has done more to reverse that trend than most. Here's to his speedy recovery and continued investment in Detroit.

1953

[Atticus]

Feature article in today's Globe and Mail w/the headline above.

Discusses the enormous impact of Dan Gilbert; but also the residual issues of poverty/inequality in Detroit.

https://www.theglobeandmail.com/worl...-but-for-whom/

The article implies concepts as truths that are too socialistic to ever happen. More so, there is this attempt in the article to make Bedrock appear as more of a problem than a positive. Articles like this are what really turn me off about liberal media. [[And yes, conservative media is awful too).

1- Detroit has social, racial, and economic inequality problems. Those problems existed before Gilbertown, they exist today, and they would still exist today if Gilbertown never happened. Gilbertown is not responsible for those problems, so let’s not pretend otherwise.

2- The article implies that Gilbertown is capturing tax money that could have been better spent elsewhere. This is a very narrow minded perspective. Yes Gilbert used tax money on his profitable projects. Those projects generate profits that didn’t exist. Those profits eventually make their way back into the public coffers. It is a hard concept for many to understand, but if you look at it from a larger [[and longer) scale, the return is much greater as a whole. Tax money given to Gilbertown is an investment. It grows. It generates a return that is far greater than the initial investment.

3- Detroit was bankrupt. The state isn’t exactly flush with cash either. So who is going to write these big checks that liberals believe can solve all of society’s woes? And that is even if you believe throwing money at the problem will somehow fix it, which in most cases it doesn’t.

4- Gilbertown is bringing jobs, and taxable wealth to the city. It is bringing a future. And yes, it is bringing in diversity. Granted it is not the type of diversity the far-left likes, but when you had a city where the vast majority of the population was very poor, maybe having a few more wealthy people in town is a positive.

But I know, Gilbert is a billionaire who received tax incentives. And by far-left liberal standards, that is guilty as charged regardless of what he has actually done with that public investment.

[Canadian Visitor]

Articles like this are what really turn me off about liberal media. [[And yes, conservative media is awful too).

For the record, the Globe and Mail is considered a Conservative, pro-business Newspaper.

It produces Report on Business Magazine, has extensive business coverage, generally endorses Conservatives politically and never the left/socialists, and is owned by Canada's richest man.

I'm always taken by the perception of of some conservatives that anything to the political left of fascism is 'Liberal'.


****

1- Detroit has social, racial, and economic inequality problems. Those problems existed before Gilbertown, they exist today, and they would still exist today if Gilbertown never happened. Gilbertown is not responsible for those problems, so let’s not pretend otherwise.

Of course. I didn't think the article implied otherwise.

2- The article implies that Gilbertown is capturing tax money that could have been better spent elsewhere. This is a very narrow minded perspective. Yes Gilbert used tax money on his profitable projects. Those projects generate profits that didn’t exist. Those profits eventually make their way back into the public coffers. It is a hard concept for many to understand, but if you look at it from a larger [[and longer) scale, the return is much greater as a whole. Tax money given to Gilbertown is an investment. It grows. It generates a return that is far greater than the initial investment.

There's some truth in that, but that is also one-sided. Were the same amount of public dollars on offer to rebuild infrastructure, or fix public education, the same dividend may well have occurred.

If Gilbert moves Quicken's HQ downtown irrespective of any tax subsidy, much of the other development might have followed anyway.

There's no way to be certain of course. I think the article really just raises a point for consideration.

3- Detroit was bankrupt. The state isn’t exactly flush with cash either. So who is going to write these big checks that liberals believe can solve all of society’s woes? And that is even if you believe throwing money at the problem will somehow fix it, which in most cases it doesn’t.

Hold on......the point above was that the government DID write a big cheque, to a profitable enterprise; clearly there was government money available for public good; the question is whether the investment made was the best one available.

PS, I'm not endorsing the article or demeaning Gilbert's contribution.

I am somewhat annoyed at what I see as a political response to a non-political article asking fair questions.

[Richard]

The newspaper is listed as liberal and slightly center right.

But is that reference to the Canadian brand of politics?

https://en.m.wikipedia.org/wiki/The_Globe_and_Mail

You will never eliminate poverty or income equality,but what you can do is provide opportunity,which is what Mr Gilbert and others are doing,without opportunity there is no hope,which as we know is more destructive then income inequality.

Only the citizens of Detroit can determine if It is or was the best use of taxpayer dollars,Weather or not he is a billionaire or a profitable buisness is irrelevant,profitable business is just that and not a charity.

I think there would be a call to question if the monies disappeared but in this case it is pretty clear the taxpayers are getting results,granted not as fast as everybody would like to see,but the city has moved mountains and it takes more then a billionaire who can only represent a portion of the mountain that needs to be climbed.

The article also overlooks the hundreds of thousands of residents that are also doing thier part in order to make thier city a better place.

It takes a village and Mr Gilbert is just one tiny part of that equation,it’s a two way street and the city needs people like Gilbert just as bad as Gilbert needs people like the citizens of Detroit.

Without each other neither one would work.

[Metro25]

This just makes me laugh. Yes Detroit has inequality but it's nowhere near what exists in other cities. You wanna see real dystopian inequality go to San Francisco or really any west coast city where people are living in tent cities and shitting on the streets next to a 200 million dollar homes.

Wealthy people are not allowed to live in Detroit if poor still exist? Should the people who wanted to be in the city just not invested and stayed in a suburb? would that be better? How is Detroit any different then other US cities? Capitalism is inherently unequal that is the root problem that should be criticized.

[Richard]

^ capitalism provides opportunity for the individual without it the individual exists solely to move the money up to the chosen few at the top.

When you look at most billionaires they started with nothing and most of the hated Titian’s of industry of the past spent thier waning years disposing of thier wealth for the public good verses retaining it.

Standard oil,Carnegie's,Rockefeller’s,Gates,Jobs etc.

What you do not see is the families from the non capitalist countries that obtained hundreds of millions creating income equality for others,donating to the Red Cross.

[Pat001]

What Dan Gilbert, Roger Penske, the Illich and Ford families are doing should be applauded. The Left is never satisfied.

[Atticus]

There's some truth in that, but that is also one-sided. Were the same amount of public dollars on offer to rebuild infrastructure, or fix public education, the same dividend may well have occurred.

If Gilbert moves Quicken's HQ downtown irrespective of any tax subsidy, much of the other development might have followed anyway.

There's no way to be certain of course. I think the article really just raises a point for consideration.

First, apologies if my response came off as hostile. It is a good discussion to have. Part of the tone of the response is because almost every media article written about tax incentives for billionaires implies it was [[at best) a bad choice by the government or [[at worst) a politically influenced decision that was borderline corruption. Very rarely will you find any article that extols the benefits of properly executed government subsidies, and the positive results yielded if done properly.

This does not mean there are not bad decisions made on incentives. A lot of times there are. But the media, on both sides, only highlights the bad cases. It never highlights the good cases and often, like in this article, takes a positive example of subsidies and implies something else. Repetitive negative stories [[implied or outright) like this do influence the public opinion, and can lead many in the populace to believe those subsidies are nearly always bad.

The incentives provided to Gilbert have worked out greatly for the city, region, and state. And truth be told, it is always a gamble. Sometimes it doesn’t work out. But in Gilbert’s case, it has. And without those incentives, many of Gilbert’s projects don’t happen.

[Metro25]

What Dan Gilbert, Roger Penske, the Illich and Ford families are doing should be applauded. The Left is never satisfied.

Ilitch?! No, not Ilitch, not ever.

[Atticus]

Hold on......the point above was that the government DID write a big cheque, to a profitable enterprise; clearly there was government money available for public good; the question is whether the investment made was the best one available.

PS, I'm not endorsing the article or demeaning Gilbert's contribution.

I am somewhat annoyed at what I see as a political response to a non-political article asking fair questions.

Actually, the government didn’t write a check. It was tax incentives where basically the government agreed to forgo collecting taxes in the near future on something for some period of time. The key difference is that there was not some pot of money sitting around that the government elected to give to Gilbert over schools, infrastructure, etc.

Now arguably one could say well 10 years from now there would have been a pot of money that could be used for those things, that won’t exist now because of Gilbert’s incentives. But that fails to consider the possibility that Gilbert’s use of the money may ultimately result in more tax dollars being collected than would have had his projects not happened. It also overlooks the philanthropic activities of those individuals brought into the city by Gilbert’s employers that would not have been here either. Again, key points notably absent in the article.

So maybe it is semantics, but tax incentives are quite different than tax credits. And the article of course failed to highlight that key difference.

[Canadian Visitor]

When you look at most billionaires they started with nothing and most of the hated Titian’s of industry of the past spent thier waning years disposing of thier wealth for the public good verses retaining it.

I assume you actually believe the nonsense you write.

Sigh.

Fully 50% of Billionaires are such due entirely to inherited wealth.

The majority of the remainder owe at least some portion of their wealth to a good education funded by their parents, their parents connections and other opportunities granted them [[not earned by them)

That doesn't make them bad people, just let's keep the facts straight, shall we.

Standard oil,Carnegie's,Rockefeller’s,Gates,Jobs etc.

Hold it, yes John D. Rockerfeller gave a lot away.....however, the decendents have not only never had to hold a real job [[though many have and do); their net worth remains in the 10's of Billions.

Jobs was not a particularly big philanthropist, in fact he barely acknowledged his own child for much of her life; his widow inherited well over 10B also.

Yes, Gates has given away billions, but to be clear he's still one of the world's 2-3 richest people with something like 100B in net worth. His generosity isn't all that substantial, in light of that number.

That does not diminish the utility of capitalism; just lets keep the numbers straight and accurately represent what it does and does not achieve.

[Canadian Visitor]

First, apologies if my response came off as hostile. It is a good discussion to have.

Thank you. Accepted!

Part of the tone of the response is because almost every media article written about tax incentives for billionaires implies it was [[at best) a bad choice by the government or [[at worst) a politically influenced decision that was borderline corruption. Very rarely will you find any article that extols the benefits of properly executed government subsidies, and the positive results yielded if done properly.

Fair, to a point. But a lot of wealth is amassed due to government interference in the free market, not just through subsidies either.

Patent and Copyright are both artificial monopolies, export subsidies, loan guarantees, countless tax deductions, hell the very existence of 'corporations' as a legal entity is a construction of government and one which vastly reduces that tax that would otherwise be paid in a direct limited partnership; not to mention the limits on liability.

None of that is to suggest we shouldn't have corporations or a free market or patents/copyright for that matter [[though I do think the latter have become far too generous); but rather that I think its fair game to ask who the government collects money from and dispenses it too; and the value thereof in any given case.

Media will always tend to focus on negatives, irrespective of their biases, as there is no traffic, the weather is lovely, and no crimes were committed tends to make for a rather short newscast/newspaper.

[sirrealone]

I don't think all tax breaks to people who build things are created equal. The Illitch family gets a bad rap because they get tax breaks and basically that goes right into their pockets. But Gilbert gets a tax break on fixing up a building and the city gets some of that back because other parties are involved. The retail that moves into the bottom floor pays tax if they make a profit. The companies that move in the office space have employees that pay city tax. The city collects on city owned lots for those that come to the Woodward corridor to hang out, eat, go to Campus Martius and all that. All of the tax breaks are definitely beneficial to the developer, but some can be seen as an investment more than others. Gilbert's are an investment. Illitch's, not so much.

Honestly, if the city wants to see the neighborhoods revitalize, I think they need two things to improve. Schools and public safety. The workers that work for Gilbert companies probably go back up to the suburbs if they have families. Schools have a lot to do with that. A lot. Where I work there are quite a few people that have moved back to the city from the suburbs over the last ten years. The one thing that every single one of them has in common? Their kids grew up and graduated out of the public education system before they moved back. If the schools were better, then I would think that some of them might never have left or might have moved back before their kids were done with school.

Of course the tough part is how. How do you get money to improve the schools in Detroit? Maybe some of these billionaires eventually endow the schools or write a big check to fund the capital improvements. I don't know. I just have a hunch that, to paraphrase a great movie, "If you build [[great schools), they will come."

[Atticus]

I don't think all tax breaks to people who build things are created equal. The Illitch family gets a bad rap because they get tax breaks and basically that goes right into their pockets. But Gilbert gets a tax break on fixing up a building and the city gets some of that back because other parties are involved. The retail that moves into the bottom floor pays tax if they make a profit. The companies that move in the office space have employees that pay city tax. The city collects on city owned lots for those that come to the Woodward corridor to hang out, eat, go to Campus Martius and all that. All of the tax breaks are definitely beneficial to the developer, but some can be seen as an investment more than others. Gilbert's are an investment. Illitch's, not so much.

Honestly, if the city wants to see the neighborhoods revitalize, I think they need two things to improve. Schools and public safety. The workers that work for Gilbert companies probably go back up to the suburbs if they have families. Schools have a lot to do with that. A lot. Where I work there are quite a few people that have moved back to the city from the suburbs over the last ten years. The one thing that every single one of them has in common? Their kids grew up and graduated out of the public education system before they moved back. If the schools were better, then I would think that some of them might never have left or might have moved back before their kids were done with school.

Of course the tough part is how. How do you get money to improve the schools in Detroit? Maybe some of these billionaires eventually endow the schools or write a big check to fund the capital improvements. I don't know. I just have a hunch that, to paraphrase a great movie, "If you build [[great schools), they will come."

I agree with most of your post, but struggle with the last paragraph. Simply put, money is not going to fix DPS. Hypothetically the state could build shiny new school buildings and staff them with the highest paid teachers in the state, and most parents still won’t want to send their kids there if they can help it.

What it really comes down to is that parents, more than anything else, want to send their kids to schools that have classrooms filled with other “good”students. And by “good”, I mean classmates who have parents with similar or greater social-economic status. Without diving too deep, a kid from a stable or affluent household is going to be much more likely to succeed than a kid without, regardless of the school. That affluent kid with involved parents is also much less likely to drop out, or get in trouble with drugs, crime, etc.

The parents know that more than anything else, having their kid surrounded by other classmates that are more likely to succeed greatly increases the chance of success for their own kid. Further, teachers of these kids are able to teach at a higher level, as less time and effort is spent on helping out the kids who are academically behind. Successful schools are the result of a concentration of successful parents. No amount of money is going to change that.

If you magically replaced all of the kids in DPS with kids from Rochester, Troy, Southfield, etc. and kept the same teachers and administrators, DPS schools would be a lot more successful. A similar analogy is a sports team with a great coach but no good athletes. They can’t win. Good teachers are obviously important, but it really is the kids that determines if a school successful... as success is very much a relative term.

Now, how you get there is tough, as it is very much chicken-and-the-egg. There is a “bad” student body, so parents who could make the student body better avoid the school. But because the parents avoid the school, it can never get better.

[stasu1213]

The liberal is asking why aren't their any monies being spent in the neighborhoods. Answer: You invest money where one will get the most positive result. Downtown is that area. Imagine Nike, H&M, Whole Foods, etc on Mack/Bewick or Fenkell/Wyoming. Those areas are economically deprived and opening mid to higher end stores in those areas would economic suicide

[DeLemur]

......

The incentives provided to Gilbert have worked out greatly for the city, region, and state. And truth be told, it is always a gamble. Sometimes it doesn’t work out. But in Gilbert’s case, it has. And without those incentives, many of Gilbert’s projects don’t happen.

How have the incentives for Gilbert worked out greatly for the city?

[401don]

What is not being discussed in the article is just how Gilbert's investment has led to a whole new viewpoint of Detroit among young people, consumers, tourists, business people and subsequently other investors. The so-called "tipping point" where large projects won't require subsidies is getting closer. Meanwhile as each building is renovated, condo is built, retail store or hotel opens, etc. Detroit citizens are employed, the tax base increases, money is available for public safety, garbage pick-up, etc. and the city improves and becomes more desirable.

Edit: I started this post prior to the previous one but it provides an answer to the question posed.

[Canadian Visitor]

The liberal is asking why aren't their any monies being spent in the neighborhoods. Answer: You invest money where one will get the most positive result. Downtown is that area. Imagine Nike, H&M, Whole Foods, etc on Mack/Bewick or Fenkell/Wyoming. Those areas are economically deprived and opening mid to higher end stores in those areas would economic suicide

Who is asking that?

I think some people are asking:

a) If the government prioritized investing in schools in those neighbourhoods, and in lesser measure in parks, streetscapes, transit etc. Would that be a better investment not only for existing residents, but also in attracting new ones, who would in turn, attract the supermarkets/condos etc.

b) If in fact the investment thus far has been successful [[and I think there's a good argument it has) what is to be done w/the proceeds from a public perspective? Will any of that benefit flow to said distressed neighbourhoods?

c) Some people in the article raise concerns w/that last idea, worried that gentrification would only force them out due to higher assessments/taxes, or higher rents. They may or may not be right, should they be, what, if anything should be done about it? I would gladly accept that any investment in those distressed areas would be good. But don't think its wrong to ask about those who may find it seriously challenging to cope with.

[Canadian Visitor]

Lets remember nuance.

Its entirely possible for something to have both positive AND negative effects, at the same time.

Its also possible for something to be good for some people AND not for others.

Its possible to see the good in something; while wondering how one might mitigate the bad associated w/that good thing.

[stasu1213]

I agree with most of your post, but struggle with the last paragraph. Simply put, money is not going to fix DPS. Hypothetically the state could build shiny new school buildings and staff them with the highest paid teachers in the state, and most parents still won’t want to send their kids there if they can help it.

What it really comes down to is that parents, more than anything else, want to send their kids to schools that have classrooms filled with other “good”students. And by “good”, I mean classmates who have parents with similar or greater social-economic status. Without diving too deep, a kid from a stable or affluent household is going to be much more likely to succeed than a kid without, regardless of the school. That affluent kid with involved parents is also much less likely to drop out, or get in trouble with drugs, crime, etc.

The parents know that more than anything else, having their kid surrounded by other classmates that are more likely to succeed greatly increases the chance of success for their own kid. Further, teachers of these kids are able to teach at a higher level, as less time and effort is spent on helping out the kids who are academically behind. Successful schools are the result of a concentration of successful parents. No amount of money is going to change that.

If you magically replaced all of the kids in DPS with kids from Rochester, Troy, Southfield, etc. and kept the same teachers and administrators, DPS schools would be a lot more successful. A similar analogy is a sports team with a great coach but no good athletes. They can’t win. Good teachers are obviously important, but it really is the kids that determines if a school successful... as success is very much a relative term.

Now, how you get there is tough, as it is very much chicken-and-the-egg. There is a “bad” student body, so parents who could make the student body better avoid the school. But because the parents avoid the school, it can never get better.

There are many children in Detroit go to school starving for there is no food at home. The teachers have to feed, clean the clothes, and teach many of these students. The households are mostly headed by unemployed single female parents. Many households don't have running water nor electricity. These are reasons why Johnny cant learn to read unless he is one of those determined children who acheive despite the conditions that student is living under. The deteriorated family structure is not always caused by the deprivation of jobs in the Community. It also is caused by the continual poor decision making that two consenting young adults make; Having unprotected sex even after the first child was born

[401don]

The liberal is asking why aren't their any monies being spent in the neighborhoods.

You, and by you I mean all of the Americans doing this, really need to stop labelling everyone a liberal or leftist or right-wing wacko based on a couple of comments. It's causing untold damage to civil discussion and society in general.

[Atticus]

There are many children in Detroit go to school starving for there is no food at home. The teachers have to feed, clean the clothes, and teach many of these students. The households are mostly headed by unemployed single female parents. Many households don't have running water nor electricity. These are reasons why Johnny cant learn to read unless he is one of those determined children who acheive despite the conditions that student is living under. The deteriorated family structure is not always caused by the deprivation of jobs in the Community. It also is caused by the continual poor decision making that two consenting young adults make; Having unprotected sex even after the first child was born

And that is the issue. I don’t blame the “Johnny” in your example one bit for the horribly unfortunate situation he is raised in. I think society has to shoulder some of that blame as well. And as you pointed out, because of that situation, the odds are more than likely Johnny is not going to be achieve more than the kid in Troy/Rochester/Southfield,etc. no matter how good the schools are.

And then you have another prospective family who, for example, are comprised of two married parents very involved in “Billy’s” education and want Billy to succeed. And while that family may feel awful for the situation Johnny is in, they also know that Billy’s best chance of success is to be in a school surrounded by mostly other kids like Billy, and not Johny. And so they locate in the suburbs.

Point being, unless you get a lot more Billys enrolled in DPS, no amount of money is going to fix the schools.

[Canadian Visitor]

.....
Point being, unless you get a lot more Billys enrolled in DPS, no amount of money is going to fix the schools.

Can I point out your statement would seem to be a recipe for giving up and not bothering to try?

Can I also point out that other developed countries, for the most part, don't have the same issues, in the same degree.

That's not to say there's no poverty [[there is) or HS dropouts [[there are) etc etc.

Just less, meaningfully less.

There are, in fact, proven solutions.

Now, perhaps we get back to the article which was more about the tax incentives/credits; and about whether the benefits of Gilbertown are being fairly extended to other areas.