Capitalism and Honesty Can Save Detroit

Capitalism and Honesty Can Save Detroit

The Motor City isn’t well known as a hub for new and innovative technologies. After the Great Recession of 2009, both the federal and local governments attempted to revitalize the auto industry, but a perfect storm of union demands, lack of capital, and competition from foreign car makers has made the American auto industry a questionable investment.  But there are people who are making an investment in both the people and the city of Detroit, and the fast paced world of technology is where the money is going. 

    Dan Gilbert, a Detroit native and strategic investor, has spent millions of dollars buying up unoccupied buildings and turned them into beacons of hope. One of his companies, Detroit Venture Partners (DVP), has been key in the creation of new businesses in the city. DVP is a tech incubator, where multiple startups work in the same space; if and when they are successful, they branch off and continue to grow. DVP also acts as a shared workspace, hosting big names such as Twitter, Microsoft, and Google in their building.

    The decor of the building seems less like Detroit and more like Silicon Valley. Upon entering the building, there is a coffee shop and stylish couches. After exiting the elevator, a few members of the workspace were playing ping pong near a slushy machine. The walls of the conferences rooms are not painted, but rather constructed as giant whiteboards. The exposed brick and open glass windows are a positive contrast to the exposed brick and broken glass windows that dominate the landscape of Detroit. But when you leave the building, you are back in Downtown Detroit: sparsely populated and under revitalization. 

    DVP’s space is part of a larger initiative called Opportunity Detroit. Buildings across the downtown landscape are denominated by the urban-inspired logo. The mission is to “showcase Detroit’s exciting present and promising future by creating an urban environment that attracts businesses, residents and visitors while promoting Detroit in a positive light.” This aligns closely with the highly successful mission of the Manhattan Institute in applying the broken windows theory to Detroit. Their rationale is the same: the city has the necessary infrastructure, but it needs to be restored in order for the city to be revived. The only way to attract more people to Detroit is to make it attractive to people. 

    I kept wondering how Mr. Gilbert’s initiatives were viewed by those in Detroit. The story has all the makings of a Salon.com horror story: rich white guy buying up all the land and starting all these companies to use corporations to make himself more money in a town with an ugly history of race relations. I was in Detroit during the Netroots Conference, and I did hear descriptions similar to Mr. Millburn Pennybags. But I found the statement by Mr. Jake Cohen, a partner at Detroit Venture Partners, to be the perspective with the most poignant truth. I asked him what he thought the feelings towards Gilbert’s initiatives were: “In a city of empty promises, Dan Gilbert is making and keeping his.” 

    That’s exactly what Detroit needs.

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