They’ve come up with a new plan to rescue bankrupt Detroit. They’re going to sell it to the Chinese.
Michigan Governor Rick Snyder, who made a living in business before making a killing in government, announced a plan that would grant 50,000 immigrant visas to well-educated foreigners who are willing to reside in blight-ridden Detroit.
The city, which now has a population of 700,000, down from its peak of 1.8 million, is the largest US city to hit bankruptcy. Perhaps realizing that Detroit’s existing citizens are largely uneducated, unmotivated, and looking to sell assets rather than invest in new ones, the lean and hungry Chinese look mighty tempting to Snyder, who has actively courted Chinese investment for years.
Two problems, to start: the federal government is in charge of immigration and has to approve the Snyder plan. And who exactly will be monitoring the immigrants to make sure they are residing in Detroit and not sneaking off into the suburbs?
Despite the obvious flaws in the plan, the idea of turning Detroit into Hong Kong has merit. The Chinese are already very active in the market as investors, and having their sandals on the ground would bring an infusion of energy to a city that celebrates the opening of a Whole Foods supermarket with a massive social media campaign and much back-slapping among politicos. Just think what they’d do if Foxconn decided that they could teach the unemployed (some say unemployables) of Detroit how to snap together an iPhone.
I 爱 Detroit
According to CNN, Detroit is already number four on the list of the top 10 destinations for Chinese homebuyers. And they’re not picky. Since China’s prime cities have the most expensive real estate in the world, its richest people see Detroit as a bargain bin, where you can pick up real estate for the price of a pair of leather shoes.
Chinese businesses are already moving hard into Detroit. In 2013, Dongdu International Group of Shanghai purchased the David Stott building and the Detroit Free Press building for $13.6 million.
Do the Chinese know what they’re getting into? Will wealthy people from a homogeneous country embrace the multicultural diversity of downtown Detroit, where street lights are a rumor and enterprise is something they fly on in Star Trek? China’s Ministry of Foreign Affairs has warned citizens about the risks of investing in Michigan.
While Snyder wants the Chinese to actually move to Detroit, it’s more likely that the investors are playing a long-game strategy, buying up valuable turf on the cheap and hoping that the land’s proximity to shipping and other US resources will eventually turn things around. They need only look across the river to Windsor, Ontario, where the murder rate is a micro-fraction of Detroit’s and the economy is on the rebound.
Gov. Snyder has also taken it upon himself to open an “Office for New Americans,” which provides information on immigration and foreign investment, along with advice on adjusting to life in Detroit (lesson one: don’t stop your car to assist anyone).
There’s miles to go before Snyder’s plan takes wing. But if he’s successful, you can imagine other cities jumping on the bandwagon, and selling whatever they can to the Chinese. Of course, we’d all better hope that China’s massive real estate bubble doesn’t burst anytime soon. At least until the ink is dry on the Detroit contracts.