November – December 2017 Commentary

three bridges illustration
1. New Ambassador Bridge 2. Converted Ambassador Bridge 3. Gordie Howe International Bridge // Illustration by James Yang

Transportation — Three Bridges

The Detroit International Bridge Co. and a coalition of federal and state governments comprised of Michigan, Canada, and Ontario are seeking to build separate crossings over the Detroit River. Based on the time required for securing the needed land and permits, the two projects are expected to open in 2023.

The Canadian government, which in September issued a permit to the Detroit International Bridge Co., owned by the Moroun family, to build a new span next to the Ambassador Bridge, is requiring the enterprise to eventually remove the existing crossing, ostensibly to eliminate competition. But that decision is shortsighted.

The Ambassador Bridge, built in 1929, has long been cited as having a 100-year lifespan. Improvements made to the bridge in recent years, including new steel coatings, component replacements, and cable upgrades, means the bridge could last for several more decades.

Rather than require the demolition of the Ambassador Bridge once a replacement span is in place, the Canadian government should allow the Moroun family to convert its existing crossing to accommodate rail. Given the movement of freight by rail is less expensive, more efficient, and causes less pollution than trucks, the prospect of three bridges — two for passenger and commercial traffic  and one for rail — would make metro Detroit and Ontario much more competitive and serve to draw more investment, trade, and jobs.

Such a decision would vastly improve a glaring deficiency in the current means of moving rail freight between Detroit and Windsor — namely, the aging and inefficient  Michigan Central Railway Tunnel. Built in 1910 and located on the U.S. side in Detroit’s Corktown neighborhood, the rail tunnel must either be enhanced or replaced to accommodate standard double- and triple-stacked cargo containers on railcars. 

Right now, trains pulling double-stacked cargo containers must slow down to nearly a snail’s pace to pass through the tunnel, due to its height. If the Ambassador Bridge were
converted to accommodate rail use, trains passing over the crossing would be able to haul
larger and taller freight loads much more quickly. Plus, the conversion of the crossing would be much less expensive than expanding or replacing the current tunnel.

By connecting the revamped bridge to existing rail lines on both sides of the border, Detroit
and Windsor would attract more cargo that arrives by ships from Asia and elsewhere. The
bulk of that freight is now unloaded and transported to railcars at major ports in Montreal and Halifax, before being transported to Chicago where it’s broken down for final shipment — a lucrative activity.

There are so many more plans and exciting developments we haven’t announced yet in The District Detroit (around Little Caesars Arena). I don’t see an end at this point.

— Chris Ilitch, President and CEO, Ilitch Holdings Inc.

If more of that freight arrived in Detroit via a converted rail bridge, businesses large and
small would benefit from hundreds of new jobs, especially at the Junction Yard cargo sequencing operations in southwest Detroit. 

In turn, the Moroun family would have a better chance of filling its vacant Michigan Central Station at Michigan and 14th Street with office users, rather than the more expensive prospect of converting it into apartments or hotel rooms. 

Healthcare — Insurance Reform

Michigan enjoys the best automobile insurance coverage in the nation. Drivers in the state pay extra each year, around $160 more on their annual insurance bill, to provide for lifelong medical coverage should they be seriously injured in an accident. The added money goes into the Michigan Catastrophic Claims Fund, which now hovers above $20 billion, to cover what can be extremely high medical bills that often result from major accidents.

While the insurance industry has long attempted to prod our legislators to reform the catastrophic fund in order to lay claim to the money (never mind that the money belongs to ratepayers), our lawamakers shouldn’t cave in to such pressure. Rather, they should provide for reforms that curtail the insurance industry from driving up rates — especially in Detroit — by using ZIP codes, education levels, occupations, and credit scores to set annual bills.

As Oakland County Executive L. Brooks Patterson, who survived a horrific car accident with the help of the claims fund, notes, Michigan is one of the only states that has no regulation over auto insurance. Even so, many agree that new rules are needed to prevent insurance companies from getting their hands on the claims fund and to curtail people who abuse the system.

The fund is a major revenue-generator for hospitals and medical centers statewide. As a result, hospitals can more readily acquire the latest medical equipment as well as retain and attract the best medical practitioners — all of which draws more people from around the world here for medical procedures (medical tourism).

Defense — Spread the Word

Michigan — especially Macomb County — has done an excellent job of drawing more defense contracts and the associated technical jobs that result from what is increasingly skilled work. Last year, 80,327 private sector jobs in the state were tied to the defense industry — a sharp rise from the 54,289 jobs recorded in 2010. Today, there are more than 96,000 defense employees in Michigan.

With defense contracts expected to increase in the coming years, industry, academic, and government entities in the state must heavily promote our standing as a major resource for R&D and production work. The campaign also should tout related resources such as advanced manufacturing, 3-D printing, artificial intelligence, information technology, cybersecurity, aerospace/aircraft parts production, and autonomous systems.

Collective industry partners must highlight the state’s rich standing as a mature market, where companies around the world have established local operations to tap into not only OEMs and a vast supplier network, but also hundreds of tool-and-die shops where workers design and craft new parts, components, and whole systems (a unique asset by global standards). 

One major benefit of the vast concentration of automotive, defense, technology, and other related enterprises in the region and the state is the ability to get everything in one place. Consider the fact that metro Detroit meets 73 percent of its defense sector demand locally. The next four U.S. regions combined only meet 20 percent of such demand in their respective local markets.