Recently, I have read an article about the economic recession in Detroit. As we all know that the other name for Detroit is “Motor City”, which means that it is famous for automobile industries. Because of the booming car market in the middle of the twentieth century, Detroit became one of the most prosperous cities in America. However, with the development of our society, the price of petroleum has shown a dramatic increase and people has been aware that compared to gas-guzzlers from General andFord, automobiles from Japan are fuel-sufficient. As a result, Detroit companies’ value propositions became weak. People changed their values, tending to buy more fuel-efficient cars and this change hit Detroit’s auto industries hardly. In fact, Detroit’s economy, approximately 80%, depends on automobile industries and the long-term auto industries’ slump made the economy fall off a cliff. From this story, it is easy for us to find that if we want to have a healthy economic system, we can not rely on one specific industry too much. On contrary, we should try to diversify our economy to guaranty healthy economic development.

Right now, Detroit government has filed for bankruptcy protection, but there is still a long journey for Detroit to go to restore their economy.

Resource: http://www.nytimes.com/2013/07/19/us/detroit-files-for-bankruptcy.html?pagewanted=all

Image: http://www.nytimes.com/interactive/2013/08/17/us/detroit-decline.html?ref=us