by Alex Halperin // July 6, 2015
On August 30, 2013, a billionaire businessman named Dan Gilbert arrived at the White House to discuss the future of Detroit. Gilbert, founder andchairman of Quicken Loans and owner of the Cleveland Cavaliers, had already invested heavily in the city; in 2010 he moved Quicken's headquarters from the suburbs to downtown and relocated several of his businesses along with 12,500 employees. Six weeks before that White House meeting, the city had filed for the largest municipal bankruptcy in US history. Gilbert was in Washington as part of an elite delegation to discuss federal assistance for the country's most visibly dysfunctional city.
The heads of the Kresge and Ford Foundations—large philanthropies that have roots in Detroit's industrial past and continue to invest in the city—were there, as well as the CEO of the Henry Ford hospital system and the then-chair of Wayne State University's Board of Governors. According to the Detroit News, the group met with senior administration officials including then-HUD Secretary Shaun Donovan, President Obama's advisor Valerie Jarrett, and Gene Sperling, who was the director of the National Economic Council.
The months leading up to the bankruptcy highlighted the depth of Detroit's ongoing problems. More than one-third of residents live in poverty and, since 2008, tax foreclosures have pushed 27,000 occupants out of their homes. Michigan's Republican governor had appointed an emergency manager to run the city, with the authority to renegotiate or cancel union contracts, hire and fire government employees, and sell, lease and privatize local assets. The city was often unable to provide basic municipal services like streetlights that worked or alarms for the fire department. The schools? Don't even ask.