The bankruptcy declared by the city of Detroit earlier this summer has brought forth a lot of reckless comparisons between the “Detroit” of our imaginations — a flashy, creative, industrious center of commerce — and the desperate, desolate place that fills a geographic designation called “Detroit.” The first is a figment of our memory and imagination. The second is an unhappy fact that may not be permanent but cannot be disguised.
“Bankruptcy” itself is a difficult term to manage, and we’ve made it more difficult by accepting so many euphemisms for it: the laws governing bankruptcy allow us to describe it as “creditor protection” and “receivership,” and even “reorganization.” The strict definition of the term refers to a state of financial ruin so severe that the party under review loses self-governance. A few centuries ago, this may have meant imprisonment or indentured servitude. It’s good we no longer take such a cruel view of failure, but it would be helpful to have better grasp on the meaning of words and ideas that come so easily into our discussions. Authorities in the past understood that failure must not be allowed to remain unchecked or unresolved.
In any case, that original meaning of bankruptcy is lost. It has been absorbed into a legal definition that eliminates the emotional ordeal of losing control. Bankruptcy is no longer a state of being; it’s a process. In fact, it can be an effective process, one that converts failure into stability, or even prosperity, but (again) a clear view of the facts must be applied and addressed. This aspect of bankruptcy is also hard to glean from the discussions about Detroit.
The particular case of Detroit’s bankruptcy invited all manner of opinions, most of which fail to recognize the facts of the matter, and dwell instead on the causes. One especially misleading line of analysis presented the two images of Detroit — the nexus of industry, the void of despair — as parallels. “Just as the auto industry has declined, so has its capital city,” or some other convenient comparison.
I’m sure most readers understand this is untrue, but it’s helpful to identify why it’s false. Most of the commercial entities that comprise the U.S. automotive industry are thriving, and while many of them have endured their own bankruptcies, in doing so they have acknowledged “the process.” They identified their failures, prioritized goals, and established objectives. One may differ with the choices they have made, or the strategies they are following now, but the industry is thriving, and in large measure we must acknowledge it is because they submitted their organizations to the process.
I’ll grant that the administrators of Detroit’s bankruptcy case seem committed to an honest reorganization process. What they cannot do, because they have no authority to do so, is to extract a similarly honest approach from all of the participants involved. Or from those who casually watch and speculate.
By this I mean that simply discussing or analyzing bankruptcy is reckless unless one is careful to document all that brought it on — the misplaced values and priorities, the disregard for standards and responsibilities — as well as the implications of what follows from bankruptcy — loss of self control, reduced credibility, and submission to new obligations.
It is easy to watch Detroit from a distance and offer commentary. It was plain, again from a distance, that such an end was coming. But, nearer to the matter, it surely has been a tortuous cycle and a miserable choice to be forced to take. Other cities and states are nearing similar choices, which will be no less difficult because of this leading example. An honest approach, for all of us, will be to reacquaint ourselves with such values and obligations that allow us to set our own priorities.