Detroit City Council demands fair Cobo Hall plan

The debate over ceding local control of Detroit’s Cobo Hall to a five-person authority in exchange for funds to renovate and minimally expand the convention center unleashed a torrent of racist media abuse on the City Council after they rejected the proposal on March 1. The political and economic pressure to relinquish control of this prime riverfront property obscures the stark question: Why is this working-class, majority African-American city impoverished when generations of Detroit workers’ labor created so much wealth?

The proposal was crafted at the state level without input from the Detroit City Council, allowing only an up-or-down vote. Any hiring or contracting preferences for city residents or businesses to compensate for the extreme unemployment among Black workers, especially youth, or provisions to cover increased expenses like redlined insurance rates, were specifically prohibited.

According to public Council discussions, the proposal left the city government responsible for police and fire costs, operating shortfalls and the remaining bonds payments while having only one mayoral appointee on the authority board. City Council members documented that more than 50 other cities have requested federal stimulus money to expand or renovate convention facilities.

Michigan governor, Jennifer Granholm, refuses to back such funding for Detroit and is forcing the regional plan, claiming regulation makes use of stimulus funds impossible.

A March 14 rally supporting the City Council action packed a local church to demand a better deal for Detroit. The next day, at a town hall meeting on the federal stimulus plan hosted by Rep. John Conyers, a representative of the governor, when put in the hot seat, assured that Granholm was dedicated to expanding Cobo Hall and would support any plan if funding was found.

GM profits impact on downtown development

Detroit’s Cobo Hall Convention Center, home of the annual North American Auto Show, anchors the west end of the downtown riverfront. Only a few blocks up the river the mirrored cylindrical towers of General Motors World Headquarters—the Renaissance Center—gleam.

For 101 years, GM workers have made cars in Michigan and now around the world. In 1992, 265,000 GM workers built 4.4 million vehicles. Fifteen years later in 2007, GM production was up to 4.5 million vehicles but with 73 percent fewer workers! In GM’s 2007 annual report, their surplus value, i.e. profits, robbed from the global workforce, was about $11.9 billion.

GM used its corporate profits to construct factories in 55 countries, including Colombia, Ecuador, South Africa, Egypt, India, Thailand, Russia and Poland, as well as the U.S., Mexico and Canada, and whipsaws workers against each other to reduce wages and benefits.

When GM shut down three Detroit plants—Fisher Body Fleetwood, Cadillac Motor and Ternsted Cut and Sew—in the late 1980s, the corporation extorted tax breaks to agree to build a new assembly plant in the city. But the new modern Poletown/Hamtramck Assembly needed fewer than half of the more than 8,000 workers displaced.

GM got a sweet deal for their luxurious riverfront landmark headquarters. Tax breaks and adjacent prime property for development, with tax-funded infrastructure improvements, increased the value of the undeveloped land, at least until the capitalist economy nosedived in 2008.

GMAC gets TARP funds

GM also loaned out that surplus value through the General Motors Acceptance Corporation and Ditech mortgages and car loans. GMAC mortgages joined the unregulated, securitized markets exposed when home lending schemes imploded.

GMAC was recently chartered as a bank, making it eligible for federal Troubled Asset Relief Program (TARP) funds because GMAC bundles and securitizes loans. This is an especially bitter pill for Detroit residents, whose neighborhoods, now pocked with vacant, stripped, foreclosed homes, were devastated when Chrysler and GM closed neighborhood factories in the late 1970s and 1980s.

Of course GM boasts of its good corporate citizenship and charity, but that is privately distributed. Tax breaks and the overall capitalist theft of surplus slowly starves the Detroit city budget of funds for municipal jobs, services, schools and even some semblance of public oversight far short of worker/community control.