Why Detroit is Built to Succeed: Looking at Detroit’s Past to See Its Future

Diplomatic Courier
January 18, 2017
Written by Marc A. Ross

There is no doubt as the world becomes more productive, we are all entering post-employment societies. This can be terrifying, as it appears more and more people will no longer be needed to create goods.

Even with this knowledge, I remain optimistic, and I look at my hometown for inspiration. By looking at Detroit’s past, I can see its future and proudly suggest the city of Detroit is built to succeed in this new environment. I believe this for two essential reasons: it is a city formed at the intersection of cultures and geography, and the city has long been at the forefront of innovation and responsible capitalism.

Detroit is at the intersection of cultures and geography

Few cities anywhere in the world share Detroit’s 315-year history. This city which has been shaped equally by geography as the gateway to the Great Lakes as well by the cultures of the people who called the region home, be it Native Americans, French, British, or Americans.

Settled in 1701 by the French, the city was named Le Détroit du Lac Érié, meaning the strait of Lake Erie. On the shores of this strait between now Michigan and Ontario and the Great Lakes of Erie and Huron, the French founded a settlement called Fort Pontchartrain du Détroit. Working this crossroads of land and water, the region developed a lucrative fur trade between the French colonists and Native Americans.

During the French and Indian War in North America, British troops gained control of the settlement in 1760 and shortened the name of the city to Detroit. At the war’s conclusion, in defeat, the France ceded its territory in North America east of the Mississippi to Great Britain. Following the American Revolutionary War, Great Britain ceded Detroit to the United States coupled with the Jay Treaty of 1796 established the northern border with Canada.

During the War of 1812, Detroit switched between British and American control as each side looked for military advantage to gain control of the Great Lakes. At the war’s conclusion, Detroit was duly incorporated as an American city in 1815 where it remains today.

With peace and firm American control, the city expanded. The citizens of Detroit were determined to build a significant and substantial city at this unique intersection of water and land. Even the massive fire in 1805 that engulfed many of the wooden structures of the city couldn’t hold Detroit down. So determined were the citizens of Detroit, a geometric street plan would be built for the modest city based on the layout of the grand boulevards of Paris.

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So important was this intersection of cultures and geography, even today Detroit’s city flag reflects its French, British, and American heritage.

The Detroit flag incorporates each country that once controlled the city. The lower left quarter represents France with five gold fleurs-de-lis. The upper right quarter represents Great Britain with three gold lions. The lower right and upper left quarters use 13 red and white stripes and stars respectively to represent the original thirteen colonies of the United States.

As Detroit looks to future, it can draw on its historical formation at the crossroads of cultures and geography for guidance. For cities to succeed going forward, they must develop committed efforts to think globally and maximize the use of their culturally diverse communities to gain the full benefits of global markets. Detroit’s long history of building on numerous cultures as well as taking advantage of its geography make it well positioned to succeed in a new post-employment world.

Detroit has long been at the forefront of innovation and responsible capitalism

Detroit has been at the cutting edge of engineering and manufacturing innovation for over 100 years. In 1903, Henry Ford famously founded the Ford Motor Company and made exceptional use of the assembly line, unlike anything the world had seen before. In addition to other automotive pioneers such William Durant, the Dodge Brothers, Henry Joy, and Walter Chrysler, Detroit was established as the clear global automotive capital. The growth of the auto industry was felt far beyond Detroit. Businesses around the nation created garages to service vehicles and gas stations to fuel up cars, as well as the building numerous factories to make auto parts, glass windows, and rubber tires. Furthermore, this multi-state, multi-plant ecosystem was a precursor to the complex global supply chains that we all benefit from today. Without the innovations created in Detroit over a century ago, raw commodity products sourced anywhere in the world could not be easily designed into user-friendly jackets, automobiles, smartphones, or jumbo-jets. It is not a stretch to say without Detroit our modern wouldn’t exist and wouldn’t be as efficient.

With Detroit’s success as an innovate engineering and manufacturing city, companies were able to take advantage of their economic windfalls and be responsible capitalists. In 1914, Ford announced that it would pay its factory workers a minimum wage of $5 per eight-hour day. The news shocked many in the auto industry as $5 per day was nearly double what the average auto worker made. In 1926 the company went a step further, as the company adopted a five-day, 40-hour work week for workers in its automotive factories. Henry Ford said of the decision: “It is high time to rid ourselves of the notion that leisure for workmen is either ‘lost time’ or a class privilege.” Both moves were brilliant management as productivity immediately boosted. These two steps of fair wages and more time off have become ubiquitous globally and now impact every sector of the economy.

As the fourth-largest city in the American Midwest and the largest city on the United States–Canada border, Detroit is positioned well for the future. As a standalone economy, Detroit’s economy is larger than Chile and would easily be one of the world’s fifth largest economies.

Today there are over 100 technology startups who call Detroit home. As Recode reports, in 2014, for the first time, there was more venture capital activity in Detroit than Ann Arbor, home of the University of Michigan. According to national education data analyzed by Anderson Economic Group, 10,000 STEM degrees are awarded annually around the Detroit region, which is more than Silicon Valley and nearly 15 percent of Metro Detroit jobs are already in technology.

The city of Detroit is built to succeed in the new post-employment environment because of the city’s history of maximizing cultures and geography as well as building upon its innovation and responsible capitalism leadership.

It is not a stretch to say without Detroit our modern wouldn’t exist and wouldn’t be as efficient. So the next time someone tells you Detroit isn’t working, say Detroit is succeeding and impacting their life positively daily.

Also, look back to the Detroit flag and note the two Latin mottos. One which reads Speramus Meliora and the other Resurget Cineribus, meaning “We hope for better things” and “It will rise from the ashes.”

With these mottos powering the city, I believe Detroit is well positioned to resume its claim as one of the world’s greatest cities. No one should underestimate the energy and the drive which has been unleashed just three years after declaring bankruptcy. Not only is remarkable, but Detroit should be inspiring to other cities who can see a path on how to adjust to new global competitive challenges and opportunities.

About the author: Marc A. Ross was born and raised in Detroit, Michigan and is a University of Michigan football season ticket holder. Marc is currently the founder of Caracal Global, a full-service communications and public affairs firm, as well as Brigadoon, a yearly gathering of entrepreneurs and thought-leaders. You can follow Marc on Twitter or Instagram @marcaross.

CCTV America: Anti-China rhetoric could negatively impact American companies

On the campaign trail, Donald Trump threatened to impose a 45 percent tariff on goods coming from China if he won the election. It was part of a political strategy to gain votes from Americans who feel like they have lost out to the forces of globalization.But following through on that threat would likely start a trade war that could hurt American companies as well as the Chinese.

Marc Ross of Caracal Global speaks with CCTV America’s Daniel Ryntjes.

Branstad Briefer: Why Iowa's Longest-Serving Governor Makes Sense for China Ambassador

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To:     Interested Parties

From:    Marc A. Ross @ Caracal Global  + Greg Levesque @ Pointe Bello

Date:    December 8, 2016

Branstad Briefer: Why Iowa's Longest-Serving Governor Makes Sense for China Ambassador

30-year Perspective

Branstad has known and engaged Chinese President Xi Jinping since 1987. Since that time, the two have forged a mutually respectful and cooperative relationship. Branstad has rightly acknowledged that the U.S.-China bilateral relationship is at a critical point. Branstad clearly understands that as ambassador he will be on the frontlines ensuring the two largest economies in the world maintain a collaborative and cooperative relationship.

American Politics + Midwest Voters

As an elected official that has been in and out office since 1982, Branstad has faced voters, asked for their vote, and governed effectively. Branstad, the nation's longest-serving governor, now in the middle of his sixth four-year term, understands that many Americans believe the nation is at an economic crossroads, one that is export dependent but at times impacted negatively by imports and cheaper overseas manufacturing. Branstad will be able to convey to Beijing how American voters are seeking bold change to renew the country’s middle class and solidify America’s essential role as a global economic leader in the future.  Understanding voters first-hand and being able to explain the challenges and opportunities of globalization shaped by American politics is unique and should be well received in Beijing.

Foreign Policy

Branstad has steered clear of commenting on the growing subset of hot button issues in the US-China relationship, including cybersecurity, human rights, and the South China Sea believing that foreign policy was best addressed at the national level. As governor, Branstad has acknowledged challenges in the relationship, but chose to focus on building “long-term friendships and relationships” with China that supported trade and Iowa jobs.

Renewable Energy + Climate Change

While publicly acknowledging that climate change is a “global issue,” Branstad has focused on ensuring Iowa remains a competitive state for business and attracting high-quality and high-paying jobs. Branstad has sought to position Iowa renewable energy companies to benefit from Chinese investment and trade opportunities.

On the sidelines of President Xi Jinping’s visit to Seattle in September 2015, Branstad, five other U.S. governors, and local Chinese officials signed an accord on clean energy and economic development vowing to take actions to reduce transportation emissions and support clean energy technologies. As governor, he has supported Iowa’s growing wind energy industry, which ranks second in the nation for total installed capacity.

Trade + Cybersecurity +  IP Protection

Branstad describes himself as a “strong supporter” of free trade, touting its vital importance to Iowa’s economy and the U.S. agricultural industry writ large. He has continually pushed members of Congress to support free trade agreements. In 2013, he signed a bipartisan governors’ letter to House and Senate leaders encouraging forward progress on the Trans-Pacific Partnerships (TPP), the Transatlantic Trade and Investment Partnership (T-TIP), and the Trade in Services (TISA) agreements.

In an April 2015 letter, Branstad urged members of the Iowa Congressional Delegation to support passage of Trade Promotion Authority and reauthorization of the Export-Import Bank (Ex-Im Bank) to help advance “market-opening free trade agreements.”  According to the letter, countries participating in the TPP and T-TIP agreements purchased $11.3 billion or 64 percent of Iowa exports in 2013.

Branstad’s pro-trade record and advocacy for improved US-China trade relations suggest he would be a staunch supporter for completing a U.S.-China bilateral investment treaty (BIT) should it become a Trump administration priority.

In addition to promoting positive U.S.-China trade relations, Branstad is sure to be a strong advocate on cybersecurity issues and intellectual property rights. Since 2013, Branstad has been working to support Iowa agriculture companies after seven Chinese nationals were arrested by U.S. authorities for stealing seeds from Iowa fields with plans to send them back to China. The Branstad administration rolled out the first ever Iowa Cybersecurity Strategy in August 2016, which seeks to improve the state’s response to and proactively mitigate risks from cybersecurity events.

Economics + Globalization

Iowa has long been recognized by CNBC as one of the "Top States for Business." Iowa is often viewed as an agriculture state, but in reality farming is a small portion of the state’s diversified economy. Iowa is also a leader in manufacturing, biotechnology, finance and insurance services. This understanding of the necessity to execute a dynamic and multi-sector economy will be helpful in Branstad’s role as a champion for American businesses seeking improved access to Chinese markets, clear enforcement of IP violations, and equal treatment under Chinese law.

Taiwan

Given Trump’s recent phone call with Taiwan president Tsai Ying-wen, it’s worth highlighting that Governor Branstad has deftly navigated the state of Iowa in its dealings with Taiwan over the last 20 plus years. In 1989, Gov. Branstad and his Taiwanese counterpart Chiu Chuang-huan signed the Iowa-Taiwan Friendship Agreement establishing Taiwan as a “sister state.” While Branstad has met with Taiwanese delegations over the years, Iowa Lieutenant Governor Kim Reynolds has regularly stepped in to manage Taiwan-related matters.

Taiwan is a major export market for Iowa soybeans and was the state’s 6th largest export market in Asia in 2015. The Taiwan Agricultural Trade Goodwill Mission delegation frequently visits Iowa to sign letters of intent to purchase agricultural products. Branstad hosted the Taiwanese trade delegation in 2011, highlighting Taiwan’s importance as an agricultural market for Iowa.

Branstad’s administration carried out trade missions or shows to Taiwan in November 2014 and August 2015, respectively.

Averting a Trade War

Branstad grasps that a trade war with China will hurt both nations, especially Iowa and the state’s farm economy. U.S. agriculture and food exports to China totaled more than $20.2 billion in 2015, half of which was soybean sales. China is also the world’s largest importer of pork and distillers grains, a byproduct of ethanol.

Just this fall, Chinese officials visiting Des Moines signed an agreement to buy $2.1 billion worth of U.S. soybeans, adding to a $1.8 billion order from this summer. According to Iowa Soybean Association, these two purchases account for more than 60 percent of Iowa’s 2016 soybean crop. Branstad understands that negotiations and securing win-win deals between the U.S. and China is not only essential, but further interconnects our two economies.

Timeline of Branstad-China Relationship

1983    

Branstad signs a formal agreement establishing    the sister-state relationship between Hebei province and Iowa

1984

Branstad leads fifty-person delegation to Hebei

1985

Xi Jinping, then a county-level party leader from Hebei, visits Iowa for the very first time and meets with Branstad at the state capitol in his formal office

2011

Branstad meets with Chinese provincial governors in Salt Lake City, Utah

Branstad has the honor of meeting with Xi, then vice-president, in the Great Hall of the People; Branstad extends Xi an invitation to visit Iowa

2012

Vice President Xi visits Des Moines and Muscatine after 27 years; Branstad sends a personal thank-you to Xi and invited him to an “old friends” reunion dinner

Branstad and Xi’s 20 Iowa friends return to China for an “old friends” reunion dinner

“Coming here is really like coming home. You can’t even imagine what a deep impression I had from my visit 27 years ago to Muscatine because you were the first group of Americans that I came into contact with.” - Xi Jinping, 2012

2013

Branstad visits Beijing, Tianjin, Baoding City, and Shijiazhuang in trade mission to China. Meets with Xi

2014

Branstad leads 5th trade mission to China with other governors led by Branstad and meets with President Xi

Branstad is recognized by the U.S.-China Business Council for his leadership in expanding and strengthening bilateral commercial relationships with China on the state and local level

2015

Branstad meets with President Xi in Seattle, Washington to discuss trade opportunities between Iowa and China

2016

Branstad leads 6th Chinese trade mission to expand beef and pork exports

Iowa’s Exports to China:  2006 – 2015

Growth in Goods Exports to China: 257%

Growth in Goods Exports to Rest of World: 31%

Growth in Services Exports to China: 488%

Growth in Services Exports to Rest of World: 89%

Source: US-China Business Council