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The Fall of Detroit and the Role of the Oil Crisis of 1973 in It
The city of Detroit, Michigan is considered to be one of the most dangerous cities in the world. Surprisingly, Detroit was not always a dangerous city, in fact, Detroit was once looked upon as the most desirable place to live in the United States of America. In the mid-20th century, Detroit was said to be the most powerful, uprising city in America. This was due to the preeminent role that Detroit played in the motor industry at the time. Detroit was once home to the headquarters and manufacturing plants of the most successful American automobile companies in the US, such as Ford, General Motors, and Chrysler. Following World War II and the Great Depression, the cities noticeable economic growth made Detroit an appealing place to reside. This was due to the high paying jobs, benefits and a presumed sustainable future. The economic and demographic depletion that Detroit faced following the decline of the American auto sector is a historic series of events that all began when German and Japanese cars were easily imported and sold in the United States. The downfall that the city of Detroit faced all began when the demand for domestic cars drastically decreased. The citys economy collapsed, leaving many citizens jobless and resulting in an extreme increase in Detroits crime rate.
In the early 1900s, the headquarters of Ford, General Motors and Chrysler automobiles were created and located in Detroit, Michigan. Thanks to Henry Fords invention of the assembly line, mass production was brought into the country and Detroits economy grew to be very strong. The demand for American vehicles was at an all-time high, so each automobile company was extremely successful. Soon enough, the population in Detroit quickly increased, because unlike its surrounding areas, Detroit was a strong, upcoming American city with many presumed stable job opportunities. Detroit’s prime was during the period that followed the Great Depression when many families were looking to relocate to a safe city where they could fit into a sustainable middle class. It’s no surprise how populated the city became. The new generation of baby boomers helped Detroit grow demographically stronger by the day. During this time Detroit was even considered to be the city with the brightest economic future in the world. The main problem Detroit faced during this time was that the success of the entire city was dependent primarily on the success of the auto industry. Issues arose as time passed and technology in the auto industry advanced. Life in Detroit began changing when the auto industry started using automation to replace labor. Automation enabled jobs that required physical labor to be replaced with advanced forms of technology and machinery, resulting in thousands of lost jobs in the industry. This harmed all residents of Detroit because the increasing rates of unemployment were correlating with a high increase in crime rate in the city. People who lost their jobs were turning to criminal activity, and doing so became more common amongst residents throughout the entire city.
The major fall of Detroit began in 1973 when a gasoline crisis occurred. This was a major fall for the city because the gasoline crisis enabled Japan and other foreign car-manufacturing countries to take such a large portion of business from the American auto industry. The oil crisis began once a ban of trade took place that stopped the importation of oil into America from countries that were a part of the 12 members of OPEC (Organization of the Petroleum Exporting Countries). The embargo ruled that America will no longer receive oil by trade involving OPEC; leaving America with no other choice but to import oil from other sources and countries that they did not have previous trade agreements with. Overnight the price of oil in the United States increased by 400%, leaving American residents in an unfortunate, frantic and unsettling situation. Eventually, the embargo did come to an end and was resolved one year later in 1974. Oil prices were eventually reduced but stood at an increased rate of 170% from the original cost of oil before the trade agreement that was passed. People in the city of Detroit were shocked but had to adapt to the sudden financial changes. The extreme increase in gas prices encouraged people to rethink the design of their cars to cut down on their car expenses.
Suddenly, all drivers were drawn towards newly designed foreign cars that were smaller and known for being much more fuel-efficient. The economy in Detroit was seriously impacted because of this, as people were encouraged to specifically shop away from all American automobile companies. Unfortunately, these automobile companies that lost business were the backbone of Detroits success, future aspirations, and economic security. Daily life in Detroit’s automobile industry quickly changed as foreign companies such as Nissan, Subaru, Toyota, and Honda became very popular in America. A drastic loss of income for American car manufacturers correlated with a high increase in sales amongst other international automobile retailers. During this time even advertisements in the American media were directing people towards buying foreign cars, continuously encouraging buyers to switch to save, implying that people will save money by switching the brand of car that they drive. Citizens, distraught about the raised gas prices, did what they had to do to save their hard-earned money, and they switched car brands.
Today Detroit is known primarily for the extreme demographic depletion that occurred in recent decades. The population in Detroit currently stands at 677,000 citizens, which is less than half of what it was 60 years ago at this time (Population of Detroit 2019 (2018, July 9)). The population in the city has fallen from an all-time high of 1,850,000 people to the current 677,000 residents, which shows that over one million people left the city of Detroit. The extreme drop in population shows how many people chose to relocate out of Detroit, which happened after people lost their jobs, the city fell into debt and the crime rate increased.
Today the city is well known for the urban decay that has left the city of Detroit as a ‘ghost town’ and a ‘shadow of its former self’ (Williamson, M. 2014, December 15). Seeing that so many people fled the city of Detroit, many areas are currently abandoned, unmaintained and have unfortunately become home to where criminal and gang-related activities take place. The crime rate in Detroit has skyrocketed and is only increasing by the day (The Detroit News, Sept. 2018) When considering the crime rate in such a small city like Detroit is devastating. In 2017, 49% of all reported crimes were incidents of homicide caused by gun violence (Hunter, G. 2019). Higher levels of firearm density increased the risk of homicide in the city (David Mcdowall. 1991). Many areas of Detroit, where a functioning society once stood, are now only memories of the past. Today the city lies in ruins and many parts of Detroit are nothing but abandoned, decaying remains of the past. Growing literature has long proclaimed the city of Detroit to be dead (William K. Tabb. 2015). Although Detroit is still alive, and home to many broken down, low-income areas with high rates of unemployment and no help provided by the city or government. It is presumed that the city will stay this way, since Detroit is currently bankrupt and in debt, meaning that there is no allocated money that can be used towards demolition, let alone funds to help rebuild the city. Ultimately, Detroit has been left as is and is an undesirable place to live, with many parts of the city being in an inhabitable state.
When the city of Detroit filed for bankruptcy in 2013, it was recognized on a global scale. Detroit had the largest bankruptcy filing in the history of the United States, the city was in debt for twenty-million dollars at the time that bankruptcy was filed. In previous years, the entire state of Alabama held the title for the largest bankruptcy filing in the United States. That changed two years later, when Detroit’s $20 million debt surpassed Alabama’s $4 million debt filed in 2011. One city was five times further into debt than an entire state and that is all due to the decline of the auto industry. The city that was once considered to be the richest in America had been depleted of their economic strength and an extreme increase in crime rate was upon them. A city that was once home to all future aspirations of America has become a prime example of what economic loss can do to a city and the citizens who live there.
In conclusion, the decline of the auto sector in Detroit negatively impacted the city and Detroit has not been able to regain their lost strength. The city that was once an economic powerhouse and automotive hub of North America has tragically been rid of all financial strength and stability. This is a prime example of how a single unfortunate event, such as the 1973 Oil Crisis, can have catastrophic effects on an economy for the future near and long.
Works Cited
- Population of Detroit 2019 (2018, July 9). Retrieved from https://uspopulation2019.com/population-of-detroit-2019.html
- Williamson, M. (2014, December 15). Detriot: Decline and Fall of the Motor City. Retrieved froM https://eandt.theiet.org/content/articles/2014/12/detriot-decline-and-fall-of-the-motor-city
- Admin (2018, February 20). Detroit – A City Being Abandoned. Retrieved from http://www.worldabandoned.com/detroit
- MacDonald, C., & Hunter, G. (2018, September 24). Detroit Ranks as 2nd Most Violent Big City. Retrieved from https://www.detroitnews.com/story/news/2018/09/24/detroit-second-most-violent-city-fbi/1408465002/
- William K. Tabb. (2015) If Detroit Is Dead, Some Things Need to Be Said at the Funeral. Journal of Urban Affairs 37:1, pages 11-12.
- David Mcdowall. (1991). Firearm Availability and Homicide Rates in Detroit. Pages 1065-1011. In Social Forces (4th ed., Vol. 69).
- Hunter, G. (2019, July 19). Detroit Shootings, Homicides Heat Up with Temperatures. Retrieved from https://www.detroitnews.com/story/news/local/detroit-city/2019/07/19/detroit-shootings-homicides-heat-up-temperatures/1775915001/
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