City of Detroit as regulator

Part of a letter to the editor from Bert G. Osterberg of Costa Mesa, Calif. in the December 19 Wall Street Journal:

As a former Detroit resident and former city employee, I can attest to the odious role of overregulation in my hometown’s decline. When Detroit began to racially change, Mayor Coleman A. Young addressed the complaints of home buyers that they were being cheated with undisclosed defects of their home purchases by championing the passage of City Certification before any sale. This regulation not only required disclosure of defects but that all properties be brought up to current city code before the sale could be made. This, of course, led to mass abandonment of older homes as the cost of compliance was often more than the value of the house….

I’m in the early stages of a contemplated writing project on why my home city of Detroit failed, that is, why it has performed so much more poorly in recent decades than many other American cities that have faced serious economic challenge and social conflict. Feel free to send specific explanations, vignettes and suggested readings (not general rants about the city, please) to me at editor – at – overlawyered – dot – com or leave as comments if they are of general reader interest.


  • Sure, I’ll play.

    About 15 years ago, my BIL had a business renting (a specialized piece of construction equipment), which required delivery on a flat-bed semi and a minimum of two people to get it off. I would often ride with him on weekends to help him deliver and pick up machines.

    One day, we got a call to deliver a machine to an address in Detroit, just North of where Comerica Park now stands. This was not what you would call a good neighborhood, but the customer was known to us, so off we went.

    The location was a turn-of-the-century apartment building, 4 storeys, and it was the only building standing on that side of the block. Everything else was empty lots, crumbling foundations and general abandonment.

    The building itself was lovely – no other way to describe it. All the original woodwork, moldings and trim, a grand entrance hall, the original curved-glass front windows. The craftsmanship and solidity of the building was a pleasure to see. The landlord had 100% occupancy, renting nice (if older) apartments to singles and families for reasonable rents. It was actually quite a bizarre island of normalcy in a sea of desolation.

    I fell to talking with the owner, who was having some maintenance work done on the outside of the building. We talked a little about Comerica Park, then being built a few blocks away. And he said “It’s nice, but it will be the end of this building soon.”

    “Huh?” says I. I can be a bit slow sometimes.

    “Yes”, he said “the new ball park makes this a desirable area, and there are people who want this land. The fun has already started. I see city inspectors all the time now, and they already have a long list of violations on the building that they say I have to address or they will shut me down. All of a sudden, my tenants are getting parking tickets when they park on the street, and citations for petty BS stuff like putting out trash cans too early. A couple of my tenants run businesses out of their apartments, and the city is giving them grief over that. They’ll just keep turning up the pressure on me, and my tenants, until the building becomes so unprofitable that I just let it go. Somebody with juice in the city wants this building, and they’re going to get it.”

    And indeed, so it was. Within a couple of years, the building was empty and abandoned, and of course it was rapidly scrapped out and trashed. It was demolished, and in short order, a nice development of apartments and townhouses took its place.

    It’s not the whole story, but this is at least a part of why Detroit has failed so miserably – that the city government has devolved into a set of personal fiefdoms, operated for corrupt profit and political power by a small, closed class of politicians and business people. The corruption has been going on so long, and has become so deeply ingrained in the very functioning of the city, that no amount of cleansing will ever get rid of it. It is simply how things are done in Detroit. Those who try to reform it (cf Dennis Archer) are simply steamrollered out of the way, while others (cf Dave Bing) have found that good intentions count for nothing, and end up standing on the sidelines watching the circus.

    To understand what Detroit has become, you need only consider the career of Detroit mayor Kwame Kilpatrick (2002-2008), presently serving 28 years as a guest of the Feds for presiding over and administration whose corruption – personal, political and financial – plumbed new depths in a place not unfamiliar with these things. The son of two lifetime members of Detroit’s ruling class, his mediocre talents were no bar to his steady rise through the levels of Detroit’s government until he assumed the position of mayor.

    Just read his Wikipedia entry to understand a small part of how things are done in Detroit.

    When you can buy the deciding vote of a Detroit city council member on a $1.2 Billion (with a B) contract for a paltry $6000 in cash and a few trips to Vegas – and everybody knows it – there really is only one way that the city is going to evolve.

    It’s a shame.



  • Detroit is not alone in this.

    Cleveland Heights, Ohio Point of Sale Inspection.

    Fact Sheet

  • A few years ago I read about an artist in Detroit who covered the outside of their home with shoes, kind of like an art car. It was an attempt to bring some joy to an area that consisted of a number of abandoned homes. I recollect that the city of Detroit condemned the house and razed it, leaving a number of abandoned homes standing. I do not recall where I read about this incident, it may actually have been on Overlawyered.

  • I predict an inexplicable rash of arson in Detroit and Cleveland on properties whose value is solely in the land.

  • One pretty good source is (the late) Bob Conet. He wrote “American Odyssey: A Unique History of America Told Through the Life of a Great City,” and oversaw the historical section of the National Riot (Kerner) Commission (re the ’67 riots). For general interest and humor, Matt Labash’s “The City Where the Sirens Never Sleep” is an enjoyable read. “Detroit, An American Autopsy,” reads like a work of dystopian fiction (which quite possibly is why the History Channel filmed its Life after People program on location: “What will Detroit look like 40 years after people? We already know…it’s already happened.”). The chronicles of Detroit’s Crime Lab —the “shocking level of incompetence,” the looting the de facto abandoned Brush Park lab, etc. — and (my favorite bit of ruin porn) Detroit’s uniquely high number of unclaimed and rotting corpses (human or architectural) seem like an apt metaphor.

  • @ras – no, that’s not likely to happen. Because the land has no value either – in fact, it has negative value, because the minute you buy a property in Detroit, the city is going to start collecting what I am reliably told are the highest property taxes in the nation. So you end up paying bo-coo coin for the privilege of owning something that’s worth – nothing. Why would you?

    Exact numbers are hard to find but it’s reliably estimated that the city/Wayne County has more than 50,000 abandoned properties on the books within the city limits, many in disrepair or ruin but many not. They are resorting to desperate measures to try and get rid of them, including block sales of huge tracts of essentially-abandoned city for pocket change, to try and get some – any – property tax revenue out of their vast holdings. But even those attempts fall flat – anyone with any sense or any serious finance doesn’t waste his time in the Detroit property market, so what you get is an endless stream of shady deals with unknown characters who end up not having the money to buy even this mass of junk property.

    The city population is now less than 1/3 of what it was in the city’s heyday. The city has far too much of everything – land, homes, schools, roads, infrastructure – and as a result, it all has zero value.

    This would be a very serious problem for the city even if it were not the bottomless pit of corruption and governmental incompetence that it is. The nature of the way the city is run is not the cause of the problem, but it just makes it worse.