In the end, it was the federal government that made the difference between bankruptcy and [Detroit] emerging out of the crisis, as Murphy put it, with credit and honor. Throughout the crisis, Murphy practiced his belief that government’s primary responsibility was to serve the social and economic welfare of people, whose basic needs must not be subordinated to corporate America’s agenda.
Will a new Detroit rise out of the ashes of its current crisis? Some cannot imagine the city Forbes recently picked as the nation’s most miserable can reinvent itself. Others place their hopes in the rise of small businesses, including urban farms, manufacturing urban bicycles, hand-made jeans, and even luxury watches. Although new startups have, so far, created only a few hundred jobs, they represent economic diversification, which may prove significant for creating a viable new Detroit after depending on one industry to anchor the community’s welfare for a century.
This is not the first time Detroit has been reinvented. In the early twentieth century the City Council was reorganized and the judicial system was transformed when an autocratic structure that denied the majority access to due process was overturned. The issue of judicial reorganization emerged as the city’s industrial elite attempted to seize control of the courts. It was the last in a series of maneuvers created and led by Henry Ford to regulate and manage the lives of Detroit’s demographically diverse autoworkers.
Murphy attacked the tight-fisted policy of Ford Motor Company (FMC) and its indifference toward unemployed workers. Henry Ford publicly maintained he would never cut wages or jobs, even as he proceeded to do both. Employment at the largest facility of FMC in Dearborn, just outside Detroit, fell nearly 50 percent between 1929 and 1932. But the overwhelming majority of laid-off Ford workers resided in Detroit, raising the question, who bore responsibility for assisting them?
To address the human element of production, Ford introduced his Five Dollar Day, Ford Profit-Sharing Plan. When the plan was unveiled in 1914, the world was stunned. Qualified Ford workers would receive five dollars a day, more than double the average wage in the auto industry at that time. When compared to lower prevailing wages in other industries such as steel, meatpacking, or coal mining, the Ford proposal was even more astounding. Simultaneously, FMC reduced the workday from nine hours to eight.