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Michigan Needs a Marshall Plan

State cannot repair its immense economic damage alone

May 18, 2008 |
Great Lakes Bulletin News Service

George C. Marshall Foundation
  Sixty-one years after President Truman signed the Marshall Plan to rebuild Europe, the federal government should consider extending similar emergency aid to Michigan.
Third of Three Parts

Sixty-one years ago, the United States realized that it was in its own best interests to help Europe rebuild after the utter devastation of World War II.

So our country launched the Marshall Plan, which was named after U.S. Secretary of State George Marshall, and aimed it at laying a strong foundation for the future of our Allies and former enemies in Europe—as well as Japan.

In just four years, America pumped $13 billion, truly a colossal sum 60 years ago, into friendly European economies and governments. The one big exception was the USSR—which did not want the money because it feared American “dollar imperialism.” Since then, the difference between the economic trajectories of the countries the used the Marshall Plan and the one that didn’t—the Soviet Union—bears strong witness to just how well huge economic redevelopment projects can work. Europe’s bleak post-war landscape was transformed within a generation.

Besides triggering the unprecedented growth of Western European in the 1950s through 1970s, the Plan was a precursor to the European Union. That is because the Plan was about more than money: It eliminated tariffs and other trade barriers and established intergovernmental coordination at the continental level. The Plan used carrots and sticks to reposition and rebuild the economies of Europe based on new principles, and it made a world of difference.

The situation in Michigan today may not be too far from the conditions existing in Europe after World War II. After two decades of assault by the forces of globalization, America’s manufacturing heartland has suffered huge casualties. Many Michigan communities are hurting; its cities are largely devastated. It is fair to say that, given how entrenched our state is in the Old Economy, Michigan has been at the very epicenter of the “Globalization Battleground.”

If this is sounds too extreme, consider the following: In the Milken Institute’s 2007 ranking of 200 large American metropolitan areas, every one of Michigan’s large metro areas was in the bottom quartile. In fact, Ohio and Michigan cities are the only ones in the ranking’s bottom ten. Michigan’s top metro, Ann Arbor, was in 82nd place in 2003; it dropped to 156th place in 2005 and was 184th in 2007. Grand Rapids fell from 151st in 2003 to 192nd in 2007. And Detroit, Michigan’s largest city, fell from 190 in 2003 to 197 in 2007—three places above dead last.

In other words, five years ago we were already in bad shape, and it’s been nothing but a freefall since then.

A Different Kind of Bomb
Admittedly, unlike Europe during World War II, there was no aerial bombing of Michigan cities, but the economic damage is somewhat comparable. Industrial production capacity is severely damaged; the region’s economic structure is facing ruin; the sub-prime lending crisis is creating more abandoned homes; homelessness continues to rise.

There were no air strikes of our roads, bridges and stations, but many still need heavy repairs, if not complete rebuilding.

Michigan cannot possibly rebound from this situation alone, with its treasury depleted and debt expanded as the state struggled to balance free-falling budgets.

It is important to note that Americans were not necessarily the origin of the Marshal Plan idea. Several prominent Europeans started alluding to the need for something to be done publicly. A number of American personalities and leaders started to catch on. No formal indication of official commitment surfaced until 1947, when then-Secretary Marshall addressed the graduating class at Harvard. During the speech, he outlined the government's interest in supporting Europe, indirectly urging them to get together a plan. Europe moved quickly to define an integrated plan, and America responded.

Table 1: Ranking of Michigan Cities on the Milken Institute’s List of Best Performing Large Metros

Metro Name



2005 Ranking


Change in Ranking2003-2007

Ann Arbor










Holland-Grand Haven





Grand Rapid-Wyoming










Warren-Troy-Farmington Hills











Lansing-East Lansing





Source: Milken Institute Best Performing Cities, 200 Large Metros, 2007, 2005 and 2003

Will Candidates Care?
Some state officials have tried to get our nationa leaders to pay much more attention to Michigan’s plight. That is why they moved the state’s presidential primary up, but as you must know, that did not work—the Democrats did not really have a real primary, and Republicans barely took us seriously. But even when they were here, we did not do a very good job of placing this issue on their agenda.

But is that opportunity lost? Maybe not. Earlier this week Senator Barak Obama, now very close to clinching the Democratic presidential nomination, visited an auto plant in suburban Detroit and then staged a huge rally in downtown Grand Rapids, where former candidate John Edwards endorsed him and attracted strong national media attention. The appearance clearly indicated that Michigan is high on Senator Obama’s priority list if he does nail down his party’s nomination.

Perhaps the next time he or Senators Hillary Clinton or John McCain returns to Michigan as a presidential candidate, we can squeeze an Obama Plan or Clinton Plan or McCain Plan out of them. Maybe with this plan, we can vote our strategic interests, not our fears.

We could well succeed in positioning the state for federal intervention if we start the dialog for the Michigan Plan for Prosperity.


Soji Adelaja, Ph.D.Dr. Soji Adelaja is the John A. Hannah Distinguished Professor in Land Policy and the director of the Land Policy Institute at Michigan State University. He also directs the Michigan Higher Education Land Policy Consortium, a partnership among Michigan State, University of Michigan, Wayne State, and Grand Valley State University scholars interested in metropolitan studies. He came to MSU from Rutgers University, where he served as executive dean of agriculture and natural resources, dean of Cook College, and chair of the Department of Agricultural, Food and Resource Economics. The opinions expressed are Dr. Adelaja’s and do not reflect the opinions of the Land Policy Institute or Michigan State University.

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