The Thursday 12/19 Detroit News carried an editorial by Reynolds Farley who once conducted the Detroit Area Study at the University of Michigan. Titled “The often-overlooked roots of Detroit’s bankruptcy” it looks at these ‘roots’ only in terms of details, of concrete particulars as if no underlying principles were involved. This detail caused that detail which in turn led to this other detail. But no one asks the obvious question: “What gave rise to the first detail?” Mr. Farley declares that “Long term economic and demographic trends brought Detroit to its present condition.” After reeling off a plethora of depressing numbers of jobs and people leaving the city, all of which are true, he declares as a cause the fact that: “First, Michigan’s system of financing local government and schools is broken. In 1911, the Legislature adopted a Home Rule Law encouraging communities to organize their own governments, generate their own tax revenue and pay for their own services. The law gave local governments no incentives to cooperate with one another in solving common problems and , over the years, the law was amended to make it difficult for communities to annex or merge.”
I for one don’t believe this to be the case. I have lived most of my 71 years in a Detroit suburb and can testify to the fact that local communities have often got together to solve problems. Nor do I accept the notion that it’s the State’s fault for not being foresighted enough to see that locals would eventually need incentives to cooperate.
But the point I really want to make is look at the cognitive pattern: the details of’economic and demographic trends’ caused Detroit’s demise. But what caused those trends? The detail of the 1911 Law we are told. But the 1911 Law is not an economic or demographic entity. It’s a political one. Politics is a science that deals with the principles of social organization. Thus what is left out of the discussion is any mention of possible political principles that could have had a causal effect on Detroit’s suicide. The 1911 Law is not a principle. It is a concrete law based on a principle, the principle of self government which I believe the 1911 Legislature was acting upon and wanted to encourage.
Detroit’s failure to its citizens was not caused by an endless string of details but by the principles that gave rise to all those sad details. The main principle behind Detroit’s sorry state is the principle that government–a political entity–should provide economic goods and services instead of the market place–an economic entity of voluntary trade to mutual benefit. Government has a legal monopoly on the use of force. It is not an economic entity. Political principles are not the same as economic principles and cannot be mixed.
Our Declaration of Independence identified the political principle on which governments at all levels are to operate: “To secure these rights governments are instituted among men.” The City (and State) abandoned its role of rights protector long ago and has tried to be the provider of economic services. The mixed economy is Detroit’s state. Its real often-overlooked roots are the political and economic principles Detroit has tried to live by. It must now relearn the political and economic principles that actually created a once free and prosperous city. The principles of laissez faire capitalism.