“How Detroit Went Broke,” published Sunday in the Detroit Free Press, is a superbly reported, written, and illustrated investigative project that shows how simplistic narratives about the Motor City bankruptcy miss the real story.
Every reporter covering government finance will benefit from studying this package.
Free Press business reporters Nathan Bomey and John Gallagher pored over more than a half-century of city financial records, building their own database from more than 10,000 pages of documents.
But then they did what matters most—the hard work of turning a jumble of complex and subtle facts, financial jargon, and economic concepts like the time-value-of-money into a smooth-reading narrative with solid organization, telling details and just enough numbers to make their points.
Here is their lead, rich with facts and yet easily digestible:
Detroit is broke, but it didn’t have to be. An in-depth Free Press analysis of the city’s financial history back to the 1950s shows that its elected officials and others charged with managing its finances repeatedly failed—or refused—to make the tough economic and political decisions that might have saved the city from financial ruin.
Instead, amid a huge exodus of residents, plummeting tax revenues and skyrocketing home abandonment, Detroit’s leaders engaged in a billion-dollar borrowing binge, created new taxes and failed to cut expenses when they needed to. Simultaneously, they gifted workers and retirees with generous bonuses. And under pressure from unions and, sometimes, arbitrators, they failed to cut health care benefits—saddling the city with staggering costs that today threaten the safety and quality of life of people who live here.
The subhead of their project was just as intriguing and certain to draw readers who know, or think they know, Detroit’s history. It read, “The answers may surprise you—and don’t blame Coleman Young.”
Young, Detroit’s first black mayor, was a hero to many black Detroiters, but also widely blamed by whites for putting the city on the path to financial collapse.
Bomey and Gallagher explode the myth of Young as fiscal fool. Instead they marshal facts to make a powerful argument that among the nine men who have served as mayor since 1950, Young did the best job of managing city finances.
Revenues exceeded debt during half of Young’s two decades as mayor (1974-94). The city’s debt, adjusted for inflation, stood at $3.3 billion in 1959. Under Young it fell to its lowest point since then, just $1.4 billion in the mid-1970s, before returning to the 1959 level by the time Young, one of the Tuskegee airmen, left office.
A drop in property tax revenues—the inevitable result of the city’s shrinking population base and a 77 percent drop in the value of property—combined with cuts in federal and state aide, a swollen city payroll, gifts to Chrysler and other industries, and some very bad deals with Wall Street were among the factors that lead to the city’s bankruptcy filing this year.
Enhancing the text are smart graphics that come to life online, with blue lines for revenue and red ones for debt drawing themselves across the screen. Balloons with tightly edited text fill in crucial facts. (It would be nice if the animated graphics would pause a little longer, though, to let the reader ponder that text.)
Contrast this serious journalism with glib captions to a photo gallery Forbes offered in “Ten Things to Know About Detroit,” or the flawed facts in a Wall Street Journal column by Steve Malanga of the Manhattan Institute that laid heavy blame on Mayor Young for financial mismanagement.
Bomey and Gallagher continue a Free Press tradition of mixing shoe leather, document analysts and computer-assisted reporting that dates to 1967.
In what is to the best of my knowledge the first computer-assisted report, Philip Meyer, with help from two University of Michigan researchers, exploded the then-current myth that the 1967 Detroit rioters were “the uneducated.” Meyer’s reporting, back in the days when data was fed into computers using cardboard punch cards, established that black Detroiters who had attended college were just as likely to have been rioters as high school dropouts—in each case 18% participated in the riots, and 82% did not. Meyer would later write Precision Journalism, about how to apply social science research techniques in the newsroom—one of the most valuable books ever for journalists. (Update: Over email, Meyer points to an even earlier instance of CAR. He writes, “In my mind, the first computer-assisted reporter was Louis Harris when he helped Newsweek with a report on ‘The Negro in America’ in 1963.”)