Where Detroit isn't going bankrupt

As a judge decides whether to let the city of Detroit go bankrupt, its residents, aided by money from many foundations, have reimagined a future based on their most valuable asset: each other.

The skyline of Detroit as seen from the south. A federal judge began hearing arguments Wednesday on the largest municipal bankruptcy filing in US history that will answer the question of whether Detroit can enter bankrupt proceedings with its creditors and unions.

People who reinvent themselves out of adversity often inspire others to do the same. Might the city of Detroit, which cannot even go into bankruptcy without a fight, be a model someday to other struggling cities on how to reimagine their future?

A national spotlight remains on Detroit more for its woes than its potential. On Wednesday, a federal judge began hearings to determine if the city is eligible to enter Chapter 9 bankruptcy proceedings. The city’s creditors as well as retired municipal workers stand to lose if Detroit is allowed to reorganize its estimated $18 billion in debt and long-term liabilities.

Yet despite this picture of one more tragedy befalling a once-great city, seeds have been planted to sprout a new urban identity, one based not on the past or off-the-shelf ideas from top-down planners. Like New Orleans after hurricane Katrina, and Greensburg, Kan., after a giant tornado, Detroit residents have been staring at each other across the rubble of vacant lots and decimated buildings and asking what it takes to redefine and then build their community anew.

Since 2007, they have been ably assisted in a collective rethink by more than $628 million from private groups, mainly philanthropic foundations. Behind the many projects already in the works – subsidizing entrepreneurs, building light rail, upgrading the waterfront, creating new housing – there has been a vital process in drawing residents into a dialogue. The aim was to build hope in each other – even when most of the world sees only tragic decline for the once-proud Motor City.

Hope has been largely missing in Detroit. It has lost two-thirds of its population since 1950 and now has only one job for every four residents. Industrial decline, corruption, and white flight had taken a toll. When the city filed for bankruptcy in July, yet another struggle began between public unions and officials over what seemed like dwindling resources.

Meanwhile, however, residents were already working on a plan called “Detroit Future City,” funded by the Kresge, Ford, and Kellogg foundations. It started with the premise that the city could do just fine with fewer than 700,000 residents. The plan, three years in the making, was almost unique in urban history. It was based on close consultations with tens of thousands of residents.

“Detroiters should be recognized as our most precious asset,” the plan states, in part because “government cannot provide all of the answers.” The city has begun to build a “civic infrastructure,” making sure each person’s voice is first heard and that common goals are discovered based on trust, respect, and mutual responsibility.

Parts of Detroit, especially the downtown, have begun to bounce back with new small businesses and cultural outlets. While private investments have helped, more important has been that “this renewed way to talk and work together is an act of faith, an act of extraordinary yet grounded and realistic optimism,” as the plan stated.

Detroit has a long way to go. New Orleans is a model in a few areas, such as a reinvented school system. Greenburg, whose residents invested in a green future, now has the most LEED-certified buildings per capita in the United States. What will a new Detroit be known for? At least for now, it is becoming known among urban planners for planting a spark of hope by simply including as many people as possible in city-wide rebuilding. 

Detroit may be financially bankrupt, as a judge may conclude. But its people are becoming richer with expectations from a renewed faith in each other.

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