Michigan

When the French aristocrat Alexis de Tocqueville on his travels to America in 1831 wanted to visit the frontier, he went got on a boat and traveled across Lake Erie to what was then the Michigan Territory. Tocqueville was not the first Frenchman to travel there. Some two centuries before, French explorers and missionaries sailed the Great Lakes and slapped their version of Indian names on the landscape, which is why Michigan’s ch is pronounced like sh and why Mackinac is pronounced with a silent final c (but Michiganders don’t carry it to extremes: Detroit ends with a robust English oit). Michigan was not effectively occupied by the United States until 1796 and was bypassed in the initial westward rush into Ohio, Indiana and Illinois. Tocqueville was still able to travel through virgin woods occupied by Indian tribes, but only barely. In the 1830s, Michigan was settled in a rush by Yankee migrants from Upstate New York, who cut down trees and built farms and neat New England-style towns complete with schools and colleges. Politically, Michigan was full of Yankee reformers who hated slavery, manned the Underground Railroad, promoted temperance and in 1855 gave Michigan a constitution that banned (as it does to this day) capital punishment. Michigan was one of the birthplaces of the Republican Party, which held its first official meeting in Jackson in 1854 (The party held its first informal meeting in Ripon, Wis.) and swept the state in the elections later that year. Until 1929, Michigan was one of the most Republican states in the nation.

After the Civil War, Michigan developed an industrial economy. Its Lower Peninsula was mostly covered with trees, and lumber was the first boom industry on which Michigan overrelied. Forests were clear-cut or swept by blazes like the 1881 fire that burned out half the Thumb. In the late 1800s, huge copper deposits were discovered on the Keweenaw Peninsula, which juts from the Upper Peninsula into icy Lake Superior. Immigrants from Italy and Finland, Cornwall and Croatia came to work in the mines. Then came the auto industry. A combination of accident and shrewdness—the prickly genius of Henry Ford and the willingness of local bankers to finance auto start-ups—ensured that America’s fastest-growing industry for the first 30 years of the 20th century was centered in Michigan. Detroit became a boomtown, the nation’s fastest-growing major metropolitan area after Los Angeles. It zoomed from a population of 426,000 in 1900 to 2.2 million in 1930 (it was 4.2 million in 2000). The auto industry drew labor from Outstate Michigan, from southern Ontario and from the farms of Ohio and Indiana. It attracted Poles and Italians, Hungarians and Belgians, Greeks and Jews. During World War II and after, it brought whites from the Kentucky and Tennessee mountains and blacks from Alabama and Mississippi.

This influx of a polyglot proletariat eventually changed Michigan’s politics. The catalyst was the Great Depression of the 1930s and company managers’ desire to use machines efficiently, treating employees as extensions of machines and with great distrust. That culminated in the 1937 sit-down strikes organized by the new United Auto Workers (UAW). Management and labor fought, sometimes literally, for pieces of what both sides feared was a shrinking pie. The UAW won and organized most of the companies after Democratic Gov. Frank Murphy refused to send in troops to break the illegal strikes. In the years that followed, autoworkers became a heavily Democratic voting bloc.

Michigan politics became a kind of class warfare, conducted with a bitterness that split families and neighbors. The union mostly won, because demographics benefited the Democrats: Autoworkers and post-1900 immigrants produced more children than did Outstate Yankees or management. After Walter Reuther’s election as UAW president in 1947, voters elected young, liberal G. Mennen Williams as governor in 1948. By 1954, the Democrats, closely tied to the UAW, seemed to have become the natural majority in the state. As growth continued, economic issues became less bitter. By the early 1960s, the class-warfare atmosphere had dissipated; in 1964, Henry Ford II joined Reuther in backing Democrat Lyndon Johnson for president. Republicans George Romney, the former American Motors president elected governor in 1962, and his successor, William Milliken, accepted the welfare-state policies endorsed by the UAW leadership and the Democrats. The state government was one of the nation’s most generous, and not just to the poor and the unemployed. It supported one of the nation’s most distinguished and extensive higher-education systems, built state parks and recreation areas, and pioneered efforts to end racial discrimination.

This system, which had seemed eternal, came crashing down with the collapse of the domestic auto industry after the oil shocks of the 1970s. Union-management relations had been static since 1941, and there had been no major technological changes in American autos since the automatic transmission in 1940. Michigan incomes had grown as Americans grew more affluent. The one-car household became the two-car household, and consumers enjoyed the tail fins and chrome of new car styling. But in 1979, this big-unit economy went bust. It became startlingly clear that the Big Three automakers and the UAW did not have a captive market, and that Americans did not have to buy a new full-sized American-made car every two or three years. Foreign competitors were producing better and cheaper cars that were more responsive to changes in gas prices and consumer preference. Big business and labor, so well adapted for growth in the quarter century after World War II, proved poorly adapted for the quarter century that followed. Auto-industry employment in Michigan fell from 437,000 in October 1978 to 289,000 in October 1982. Chrysler nearly went bankrupt, Ford was in financial distress, and General Motors posted its first losses in years.

The collapse of its big-unit economy forced the state to experiment. The first to try was Gov. James Blanchard, a Democrat elected in 1982 with a record of supporting big units. His major achievement in eight years in Congress was managing the Chrysler bailout in the House. Blanchard worked to build a small-unit economy. He was proud of his efforts to stimulate high-skill, capital-intensive, flexible manufacturing, and he used $750 million of state pension funds as venture capital for manufacturers of items ranging from tape drives for microcomputers to fiberglass coffins. The second experiment came from John Engler, the Republican who beat Blanchard in 1990 and was resoundingly reelected in 1994 and 1998. Engler believed in less government activism and industrial policy. He cut taxes more than 30 times, and welfare rolls were cut by more than two-thirds. Engler pressed for public school choice and charter schools, and changed state pensions from defined benefits to defined contributions. Throughout the second half of the 1990s, the economy boomed. The auto industry, once an employer of thousands of low-skill workers, became more high-tech. The number of unionized autoworkers fell to 250,000 in 2000, but jobs required much higher skills and autoworkers’ earnings averaged $60,000. With the auto companies requiring high standards and speedy turnaround from subcontractors, Michigan became the home of almost all the nation’s auto-parts engineering centers and of much of the nation’s large-scale manufacturing experts. Michigan’s population rose 7% in the 1990s after staying even in the 1980s; median household incomes rose 5% after inflation. Large parts of the state—the western and northern suburbs of Detroit, greater Grand Rapids, the northwest corner of the Upper Peninsula—were unmistakably booming. The one glaring exception was the city of Detroit. Its population fell to 951,000 in 2000, almost exactly half the 1.8 million people it had in 1950. Starting with the riot of 1967, crime rates in Detroit were enormously high for 25 years, and much of the city simply vanished—houses were abandoned or burned down, commercial frontage had nearly 100% vacancy rates, the downtown was a beleaguered fortress surrounded by blasted-out square miles. But even Detroit began rebounding in the 1990s. Crime and welfare rolls were down, new stadiums and gambling casinos, even some new housing, were built downtown, and old theaters were refurbished.

But the recovery didn’t last. Since 2000, efforts to diversify the economy and to encourage flexible manufacturing were not enough to compensate for the sharply deteriorating condition of the Big Three—or the Detroit Three, as they were called in November 2008, when their tin-eared CEOs flew in their corporate jets to Washington to seek a multi-billion-dollar taxpayer-financed bailout. The first signs came in 2000, when the state’s unemployment rate rose above the national average; employment peaked at 4.9 million in January 2001 and declined to 4.1 million by December 2008. Michigan never recovered from the brief 2001 recession, and by December 2008, unemployment had risen to 10.5% of the labor force. The state’s gross domestic product started shrinking in 2006. The net outmigration of people from 2000 to 2008 was 316,000—higher than any other state except New York. Democratic Gov. Jennifer Granholm came to office in 2003 as the state was beginning its most recent downward economic spiral. She encouraged “cool cities” developments and arranged for tax breaks for new facilities for the automakers. There were some encouraging signs. Michigan was developing new jobs in health care, professional services, finance and tourism. Still, the incremental progress has not stemmed the outflow of people. And immigrants by and large have avoided the state; its population is just 4% Hispanic and 2% Asian, and while it has the nation’s largest Arab-American population, their numbers amount to less than 2% of the total.

Throughout the decade, the Big Three foundered—constrained by their contracts with the UAW, with their generous benefits and thousands of pages of work rules, and unable or unwilling to build the high-mileage vehicles that the public wanted and that government standards demanded. The bankruptcy of auto-electronics giant Delphi showed the UAW that its contracts could be torn up by a bankruptcy court, and General Motors was able to squeeze major concessions from the union in the contract negotiated in September 2007, including a stipulation that new hires could be paid lower wages and benefits. But the changes came too late. Big-car sales plummeted when gas prices reached $4 a gallon in May 2008, and after the financial crisis triggered by the failure of Lehman Brothers that September, the Big Three’s sales plunged to catastrophic lows. GM and Chrysler were bleeding billions in cash every month. Ford was saved from the same fate because it had mortgaged virtually all of its assets in 2007. The $25-billion loan package that the automakers sought was defeated in Congress, and President Bush granted GM and Chrysler a temporary loan, until March 2009, of $13.4 billion. That left the problem to the new Obama administration.

Since the 1930s, Michigan politics has been divided between labor and management, and between the Detroit metro area and Outstate. In 1960, John F. Kennedy carried three-county metro Detroit 62%-38%, and Richard Nixon carried Outstate 60%-39%, for a 51%-49% Kennedy victory. In 2004, John Kerry carried the three-county metro area 56%-43%, while George W. Bush carried the rest of the state, which cast 61% of the vote, by only 52%-47%, for a 51%-48% Kerry victory. Kerry’s lead in the metro area came almost entirely from the city of Detroit, which cast only 7% of the state’s votes but voted 94% for Kerry. Kerry carried affluent Oakland County, where many upscale voters moved toward the Democrats in the 1990s on cultural issues. Bush carried Macomb County, historically more blue-collar and Democratic; it is pretty affluent now, and in the 1970s and 1980s, it trended away from Democrats on cultural issues. The Grand Rapids area, with its large Dutch-American population and many Christian conservatives, voted heavily Republican. The industrial Flint, Saginaw and Bay City areas, where unions remain relatively strong, voted heavily Democratic, as did the areas around Lansing, the state capital, and Ann Arbor, home of the University of Michigan. The Upper Peninsula, historically Democratic, voted for Bush.

Similar patterns are apparent in state elections. In 2006, against Republican Dick DeVos’s expensive self-financed campaign, Democratic Gov. Granholm was re-elected 56%-42%. Also that year, Democratic Sen. Debbie Stabenow, a narrow winner in 2000, was re-elected 57%-41%. Democrats recaptured a majority in the state House, held by Republicans since 1994, and ran what turned out to be competitive races in four Republican congressional districts. Even so, there was one discordant result. The ballot measure banning racial quotas and preferences in state government and state universities, which was opposed and shunned by politicians of both parties, passed by a resounding 58%-42% margin, trailing only in the counties that include Detroit, the University of Michigan and Michigan State University.

The 2008 election results showed even more movement toward Democrats. At some points during the campaign, polls showed John McCain to be competitive in the state. The Democratic National Committee’s decision invalidating Michigan’s presidential primary meant that Barack Obama’s campaign got a late start organizing here. But after the national crisis in the financial markets in mid-September, the numbers shifted toward Obama, and the McCain campaign announced it was pulling out of the state. Obama carried Michigan 57%-41%, the best Democratic showing here since 1964. He carried Oakland County and Macomb County as well. He even carried, by a narrow margin, Grand Rapids’s Kent County. The trend toward Democrats was especially strong in hitherto heavily Republican western Michigan. Sen. Carl Levin, Michigan’s most popular Democrat, was re-elected to a sixth term by 63%-34%, his best margin ever; he carried 77 of 83 counties. Democrats increased their majority in the state House to 67-43 and captured two Republican seats in the U.S. House. Michigan, historically Republican and for some decades very marginal, now seems more Democratic than at any time in its history.