Retooling the Motor City: Can Detroit save itself?

Much of the progress is homemade, by residents themselves who are actively taking part in improving their neighborhoods.

"You can see the chipping away at the negative mind-set that existed," says Geoff Gowman, who, as a Detroit native, has the long view of the city's trajectory. He has spent the past 30 years protecting – and renovating – a faded Art Deco movie theater as a focal point for his East Side neighborhood and credits the new mayor's "class and integrity" for creating "a whole different ballgame" in Detroit.

NEW VISION, OLD BATTLES

But the political cost of reimagining Detroit is significant, especially with the city already on the brink of bankruptcy and no clear solution agreed upon.

What to cut and for how much has Mr. Bing at odds with the city council as well as Detroit's entrenched labor unions – and there's no end to the finger-pointing about who's to blame for the city's financial turmoil and who bears the most responsibility for making things right.

Some see Detroit's failures as the nation's burden, considering how much the city's automotive past helped generate prosperity elsewhere. In April, City Councilwoman JoAnne Watson called for a $1 billion federal bailout, saying Detroit was "worth at least as much as General Motors or Chrysler or the Wall Street bankers."

Bing wants the city's 48 unions to concede to job and benefit cuts, threatening that if the city does not gain control of its finances it may lose the right to determine them. Michigan's governor has the power to dispatch an emergency financial manager who is enabled to hire and fire employees, void union contracts, and make changes without the approval of the mayor or city council. There are vivid precedents: former Gov. Jennifer Granholm (D) appointed a manager to take over the towns of Pontiac, Ecorse, and Benton Harbor. The current Republican governor, Rick Snyder, did the same for Detroit's public school system this year. [Editor's note: This paragraph was corrected to credit Governor Granholm with the town manager appointments.]

"It's more than a threat," Bing says of the state takeover. Last year the city paid $191 million in health care to union employees and retirees and $200 million in pension payouts, both of which Bing says are "unsustainable."

Unions balk when Bing brings up the possibility of a state takeover, saying they've made concessions in the past and that the city's budget shortfall is not their responsibility. "My attitude is, I'd rather have a fight with an outsider imposed on us from outside Detroit rather than being nickel-and-dimed" by the city, says Michael Mulholland, the secretary-treasurer of American Federation of State, County and Municipal Employees (AFSCME) Local 207.

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