Detroit And The Bay Area

744 Words2 Pages

For decades, America has been the fastest growing economy country in the world, and Detroit was one of the most leading populous city in the United States. Back in 1930, Detroit was the fastest growing city, but now is the fastest shrinking city with more than 100, 000 abandoned homes (Heidi Ewing and Rachel Grady). Similarly, Bay Area economy was the envy of the nation with high employment rates and GDP growth like Detroit in the 1930s, and is currently suffering from losing jobs, residents, and status. Both Detroit and the Bay Area are single resource-based industries - where Detroit is manufacturing dominated, and Bay Area is high technology dominated. However, the Bay Area will not go bankrupt and become a ghost town in fifty years, because its high diversities in the economic opportunities are attracting people to stay and work here. High educated and talented people is the fundamental for the economic development in the cities. In Detroit, many workers in the car industries are either unskilled or low skilled workers with only high school diplomas simply because of those works do not need special talents or skills in order to have the work done. Due to the division of labor, large jobs are breaking down into many tiny components. “Under this regime each worker becomes an expert in one isolated area of production, thus increasing his efficiency” (Adam Smith). Detroit was not creating suitable jobs for high educated or professional people to work there; therefore, it caused the brain drain. Brain drain by definition means “the departure of educated or professional people from one country, economic sector, or field for another usually for better pay or living conditions (Merriam Webster Dictionary). This means that high skil... ... middle of paper ... ...cars. According to Nancy Andrews, Christopher Kirkpatrick, and Eric Millikin, “Detroit went on a binge starting around 2000 to close budget holes and to build infrastructure, more than doubling debt to $8 billion by 2012.” Detroit was borrowing money to build these infrastructures that are not capable of doing other things except to build cars; therefore, when other countries cars has found out other ways to make cheap cars and to sell their cars for a cheaper price, Detroit cannot lower their cars’ prices due to their loans for building the infrastructures. However, the Bay Area will not go bankrupt because it is not in debt. In contrast, the Bay Area is gaining a revenue, which the grand total revenue is $6670.6 millions in the year of 2013. In addition, the Bay Area is planning to gain a revenue of $276.92 billions in next twenty eight years (Plan Bay Area).

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