Detroit was once known for the booming automobile industry and the home of The Big Three: Ford, Chrysler and General Motors. Plentiful jobs, strong labor unions and comprehensive benefits made Detroit the place to be. Not only did the auto industry help make Detroit Michigan’s most populated and prosperous city, Motown Records created some of America’s most loved songs. Yet even before the U.S. economy faltered, Detroit began having problems.
Detroit’s auto industry was losing steam for many years as seen in the 1989 documentary “Roger and Me.” Today Detroit has gone from financial prosperity to an estimated debt between $18 – 20 billion. The following shows a timeline of events and some of the challenges facing the city.
March 01: Michigan governor Rick Snyder takes over Detroit’s finances
March 14: Financial emergency signed over to Local Emergency Financial Assistance Loan Board (ELB), pursuant to Public Act 72 of 1990 by Snyder
July 18: Detroit, MI files for Chapter 9 bankruptcy, threatening the benefits of thousands of retired city employees
July 19: Michigan Attorney General Bill Schuette claims the bankruptcy must be withdrawn due to a violation of the Michigan constitution and state law
Detroit’s Financial Health
$7,500: Average home price
18.6%: 2013 unemployment (Compared to a national unemployment rate of 7.6%)
700,000: 2013 population (Population during the 1950s: 1,850,000)
78,000: Abandoned buildings
66,000: Vacant lots
40% Street lights not working
92.3%: Unsolved crimes
Bankrupt Celebrities Lead The Way
Francis Ford Coppola
Francis Ford Coppola, creator of blockbuster hits “The Godfather” “Apocalypse Now,” “Dracula” and others, was born April 7, 1939. While success seemed guaranteed, in 1982 he made the box office bomb “One from the Heart,” which cost $26 million to make and earned only $636,796. In 1983 he filed for personal bankruptcy and bankruptcy on behalf of Hollywood General Studios, one of his production companies. In 1990, Coppola’s production company Zoetrope Studio filed for Chapter 11 bankruptcy and he changed the name of the company to American Zoetrope. 1992 saw another bankruptcy for himself and his company, Zoetrope Corp. and Zoetrope Productions.
Debelah Morgan, the singer and songwriter, was born Sept. 29, 1977 and became well-known for her hit single “Dance With Me.” In 1994 she released her debut album “Debelah” with Atlantic Records, but was dropped from the label shortly thereafter. She signs with Detroit’s Motown Records in 1998 and released “It’s Not Over.” A year later, she leaves Motown due to creative differences and files for bankruptcy. In 2000 she released “Dance With Me” on Atlantic Records after signing back with them.
Ed McMahon, comedian and announcer known by millions for introducing Johnny Carson on “The Tonight Show with Johnny Carson,” as well as the public face of Publishers Clearing House, had many financial problems before his death June 23, 2009. He owed $644,000 for his mortgage loan in 2008, have $750,000 in unpaid American Express charges and even owed $51,000 to Hix, Inc.
Dennis Rodman is best known for his outlandish style and tenure with the championship Chicago Bulls, but his basketball career started in the Motor City with the Detroit Pistons in the years of 1986 to 1993.
Born May 13, 1961 in Trenton, NJ, he used his talent and skill for the NBA. Yet when he retired in 2006, he was already having financial problems. By 2012, his child support debt to his ex-wife exceeded $800,000, but couldn’t pay a dime.
Allen Iverson, while less famous than Dennis Rodman, had a decade-long career with the Philadelphia 76ers. However, he played for the Detroit Pistons during the 2008-2009 season; his one-year earnings were $20.8 million. Iverson was born June 7, 1975 in Hampton, Virginia and like many star athletes (and some US cities), mismanaged his finances to the point that in 2012, a Georgia judge ordered his bank accounts seized after he claimed he was flat broke and couldn’t pay his debts.