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Can Higher Ed Really Be This Clueless?

July 9, 2014 in Economics

By Christopher Westley


Readers of the Mises Economics Blog will be glad to know of a job opening: Detroit’s Wayne State University is seeking “a nationally prominent academic leader for the Coleman A. Young Endowed Chair in Urban Affairs.”  Coleman Young was, of course, the corrupt mayor of Detroit from 1974 to 1994 and is seen today as one of the most destructive and divisive mayors in all of U.S. history.

Although hardly the sole player causing a troubled city to become the textbook case for municipal catastrophe that it is today, Young and his policies helped set the stage for it by overseeing and extending Detroit’s welfare-ization in order to pacify and/or buy off otherwise angry segments of Detroit’s population in the decades following the 1967 riots.  What were once low-income neighborhoods became low-income and dangerous neighborhoods that scared away productive labor and capital already overburdened by Great Society overreach, and wealth-creating Detroiters escaped to safer and more bourgeois suburbs and states.

Under Young, Detroit became known as both the arson and murder capital of America, an accomplishment that’s somehow not found on his gravestone.  Its metro population fell by a third from 1970 to 1990 (and by more than a half from 1970 to 2010).  Although the mayors who succeeded him wrought more fiscal harm, some say Young’s severe racial rhetoric was cynically calculated to create a majority black city that would provide a more electorally secure environment for himself.

One concedes that if the University of Missouri still has its endowed economics chair named for former Enron CEO Ken Lay, then Wayne State should possibly be granted some slack in maintaining a Coleman Young Chair in Urban Affairs.  The contrast is interesting.  The Enron saga reminds us that when firms fail in the market, they at least are shut down before incurring any more damage, while their capital is transferred to others who might use it more efficiently (and, in Enron’s case, more ethically too).  Young’s legacy should remind us that when entities operating outside of market forces fail, their destruction is demonstrably more deep and persistent and can continue in that vein for decades—at least until they become relatively less aggressive against the natural rights of person and property.  

It is no accident that Detroit’s remarkable implosion since 2008 has been followed by several exciting entrepreneurial developments in that city.  Bankruptcy has its upsides, …read more


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