The Man Who Would Sell Detroit
Sandy Baruah ’88, staffer for both presidents Bush, former head of the U.S. Small Business Administration, and one-time management consultant to Walt Disney World, is trying to jumpstart the Motor City.
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Detroit, Michigan, has a PR problem.
Many, perhaps most, people around the country believe that Motown has become No Mo’ Town, a blighted urban landscape, slowly decaying, with entire deserted neighborhoods given over to so-called “urban prairie” and the crumbling ruins of immense factories that once cranked out cars by the tens of millions. Maybe not quite postapocalyptic, but definitely postapoplectic.
Put that notion in neutral. While it is true that a local company runs “The Fabulous Ruins of Detroit” tours, and that the 2010 U.S. Census showed 237,500 citizens departed the Motor City since 2000—the second greatest ten-year drop in population for any large city in U.S. history (only Katrina-devastated New Orleans lost more, 29 percent compared to Detroit’s loss of 25 percent)—the rumors of Detroit’s death are greatly exaggerated.
At least that is the well-stated position of the energetic and enthusiastic Sandy K. Baruah, new president and CEO of the Detroit Chamber of Commerce. He would have you believe that Detroit’s upside is unlimited, that a new economy will elbow out from the junkyard-crushed cube of sheet metal that was once the Great American Auto Industry, that even now the city is in the middle of a spin-the-wheel-pull-the-handbrake-180-degree turn in its fortunes. And the thing is, he just might be right. In truth, even two centuries ago the city was all about the comeback: Adopted in 1805, Detroit’s official motto remains “We Hope for Better Things; It Shall Rise from the Ashes.”
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The first Cadillac hit the streets of Detroit in 1701, although there weren’t actually any streets, just a small fort with half-a-hundred French Canadians led by their captain, Antoine de La Mothe Cadillac. By 1765, 800 souls lived beside the Detroit River, making it the largest city in French territory between Montreal and New Orleans. A century later, many Detroiters fought with distinction in the Civil War as members of the Michigan Wolverines, a heroic regiment led by George Armstrong Custer. “Thank God for Michigan!” Abraham Lincoln is said to have exclaimed after the Battle of Gettysburg.
The city grew rapidly on an economy of shipping and manufacturing and then, in 1901, a thirty-eight-year-old local engineer and automobile designer named Henry Ford founded the Ford Motor Company. Twelve years later, he opened the assembly-line factory (his employees’ idea, many now believe) that would change Detroit, and the world, forever.
One by one, mass-market automobile pioneers like William Durant, founder of General Motors, the Dodge brothers, Horace and John, and Walter Chrysler rose to success in Detroit. By the 1920s, the Motor City was king of the road. By the 1930s, growing labor unions including the United Auto Workers were in a sometimes pitched battle with the carmakers for a share of that enormous success.
The expansion of the auto industry and the jobs it provided made Detroit the fourth-largest city in America in 1920, and by 1950 its population peaked at 1.8 million. And then, the very thing that made Detroit began to slowly shrink Detroit, as the car enabled more and more people to move to the clean, uncrowded suburbs. Urban Detroit began to empty. Soon, the auto industry began to shrink as well—consolidation began in the 1960s, reducing jobs, and the gas crises of the 1970s boosted market share for foreign automakers. By 2010, Detroit’s population had declined to 713,777 (smaller, for example, than Jacksonville, Florida), and Michigan became the only state in the nation to register a net population loss since 2000. The once thriving Motor City had shed several cylinders and much of its horsepower.
News reports began with phrases like “The most startling example of modern urban collapse,” and the city became a cautionary tale—and a punch line: when comedian Kathleen Madigan was entertaining troops in Afghanistan, she was given a tour of schools, hospitals, and roads the soldiers had built.
“That’s awesome,” she said. “When we’re done here we should invade Detroit.”
Such is the state of the city’s public image. And how long does this thought deter the optimism of Sandy Baruah? Even less time than it takes the new 560-horsepower Cadillac CTS to go through a gallon of premium. Baruah sees better things; he believes Detroit is already rising from the ashes.
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Assam is a state in the far northeast of India. Mostly separated from the rest of the country by Bangladesh, it is well known for its teas.
This is where Baruah’s parents were born, coming to the United States in the 1950s, his father to attend medical school at Georgetown, his mother to attend Howard University. They settled in Washington, DC, where their only child was born in 1965.
His father died when Baruah was just nine years old, and his mother moved with her son to Salem in 1975.
“We owned some property in the state,” he says, “so one day my mother said, ‘We don’t have anywhere else to be, let’s try Oregon.’”
Soon after arriving, Baruah’s mother opened a shop selling bulk spices, teas, and coffees, a sweet-smelling bit of Assam next to a Ford dealership.
Growing up a dark-skinned Indian kid in oh-so-white Salem was never a problem for Baruah. The far bigger issue was that he had zero game.
“The whole ‘being different’ thing was never really part of my core experience,” he says. “Oregon was progressive, and also there were so few minorities in the state when I was growing up, especially from India, that people seemed to judge you on your individual merits and there wasn’t a lot of baggage attached to you for looking different. I’ll tell you what did make me feel separate: the fact that I was a lousy athlete! Not being good at sports mattered infinitely more than the color of my skin or where my parents were born! To me, that was much more impactful.”
During high school, Baruah worked selling suits at the local Meier and Frank store, and life in the state capitol began to rub off on him. He became interested in politics, taking part in various civic activities and programs, some of which took him south to the UO campus. Early on, he found himself identifying with the Republican Party—as defined by a select list of Oregon examples.
“I knew I was a Republican long before college,” Baruah remembers. “It’s tougher to define what a Republican or a Democrat is now, but I still cling to the idea that Democrats are good at giving people fish, and Republicans are better at teaching people to be fishermen. And being in Oregon my role models as Republicans were people like Tom McCall ’36, Bob Packwood, Mark Hatfield, Norma Paulus, Dave Frohnmayer—I realized you could be both socially progressive and fiscally conservative. You could have an understanding of how the economy really works, how to spur private enterprise and build a strong national defense, yet not hold some of the social views that many Republican conservatives hold. I had opportunities to meet Senator Hatfield and Senator Packwood, and they seemed to be right where I was in that sense.”
At the UO, Baruah split his studies between business, political science (the label on his degree), and economics, eventually winding up somewhere in between. He became more and more drawn to national politics, and in 1985 he took a two-year leave of absence from the UO to work for Senator Packwood on his campaign staff. It was his first look behind the curtain of big-time politics.
“I didn’t know what to expect,” Baruah says, “but what hit me first and foremost was that these [politicians], who we tend to look at as entities, are actual human beings, with the same emotional underpinnings as everyone else. They do human things, like having to take time out of a meeting to speak to one of their children, like trying to find the balance between their public role and their families and friends. Intellectually, I guess I wasn’t surprised by that, but being so close to it had a profound impact.”
Baruah returned to Eugene to finish up, and as he was preparing to leave the UO in 1988, he began to look for a job. He’d volunteered on the George H. W. Bush campaign, so he called up the Oregon campaign chair, Alan “Punch” Green, to ask for a reference.
“I called Punch long distance,” Baruah recalls, “and asked him if I could use his name. So he puts me on hold for a long time, and I’m getting aggravated because I’m a college kid with no money and he’s costing me a fortune in long distance charges! Finally he comes back and says, ‘Sandy, you have a choice. I can give you a reference or I can give you a job.’ It turned out he was looking for someone to run the campaign’s field operations in Oregon and Washington, and Senator Packwood had recommended me. I told him I’d take the job, and he asked me how much I wanted to make. I asked him how much he wanted to pay. He gave me a figure that was incredibly low, that I couldn’t possibly live on, and I said, ‘Great, I’ll take it!’”
After Bush won, Baruah was asked to move to Washington, DC, to work in the new administration. This was the political equivalent of being called up to “The Show” in baseball, and the twenty-three-year-old Baruah relished the big-league atmosphere.
“It was fabulous,” he says. “You’re exposed to and working with the best and brightest from all over the country and the world, the tempo is furious, and you have to be at the top of your game. Every day in the halls you see the people you used to see only on TV. It helped me so much that Senator Packwood had been such a demanding boss—from my time with him I knew how to think ahead, to write well, to know what was important and what wasn’t.”
Baruah was in wonk heaven, and he made the most of it, first as an assistant to the secretary of the interior, then in the Department of Labor. In the morning he might be writing policy papers or memos on appointees up for Senate confirmation, in the afternoon he might be getting coffee for a meeting—just as in The Show, even the hottest rookies carry the veterans’ bags.
In 1993, like the president, Baruah found himself out of a job. He decided to return to Oregon, certain he would take the provinces by storm. He was wrong.
“One of the great learning opportunities of having great jobs so young was that, while I thought I was very cool, no one else got the memo. I thought I’d get hired in a heartbeat back in Oregon, but I quickly discovered that the political world and the business world don’t necessarily speak the same language, and that prestige in one area doesn’t always translate to another. If I was going to convince business that I had value, I figured I’d better get some skills.”
And so, ten years after graduating from high school, Baruah found himself back in Salem, living in his mom’s house, once again selling suits at Meier and Frank and working on an MBA at Willamette University.
“I’d run into people I hadn’t seen since I left,” he says, laughing, “and I’d tell them I was back in school, living at home, and working at M and F. They’d look at me like, ‘Oh man, this poor kid, we thought he’d end up doing something. His mother must be so embarrassed.’ It just seemed so small to add ‘I was working for the president of the United States,’ so I just let it go.”
He earned his MBA in 1995, about the same time his former boss’s son was taking office as governor of Texas, and went to work for a Portland-based corporate management consulting firm. He worked with clients that included Walt Disney World, Intel, and several banks. And when George W. Bush won the 2000 presidential election, Baruah was on his way back up to The Show. This time, people carried his luggage.
“I returned at a much more senior level,” he says, “but how you’re treated in Washington totally depends upon your business card at that moment, and understanding that made my tour of duty with Bush 43 much more enjoyable. I was able to take the trappings of my various offices with a large grain of salt.”
Baruah served as U.S. Assistant Secretary of Commerce, leading the federal government’s domestic economic development program. He took over as administrator of the U.S. Small Business Administration in the final year of the Bush presidency. And while the Republicans for whom he worked moved considerably farther right from Bush to Bush, Baruah insists he didn’t abandon his Packwood-Hatfield-McCall roots.
“I didn’t change,” he says. “Certainly there are issues on which I disagreed with the second President Bush, a woman’s right to choose being one example, stem cell research being another—but the social issues are not why I was ever engaged in politics. And in most things I found Bush 43 to be an incredible humanist, constantly promoting the ideas of freedom and democracy and what they meant for human rights.
“What attracted me to Bush 43, and this grew over my eight years with him, was that he was willing to make the tough decisions based entirely on what he believed were the best interests of the country. I spent a lot of time with him, and he rarely ever looked at things in a political way. In fact, if you were to raise the PR or political ramifications of a decision with him, he got visibly irritated. His answer always was, ‘That’s not why they sent us here. Our job is to do the right thing for the country, and if we take some hits, we’ll take some hits.’ To him it was all about moral courage, not politics, and I’m confident that, in time, people are going to look back at his presidency and, while they may disagree with some of his actions, they will realize he was the kind of president we hadn’t had for a very long time, and may not have again—which I think is quite sad.”
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Thanks to a geographical anomaly, from Baruah’s office high in downtown Detroit, he can look south into Canada—Windsor, Ontario, to be exact. It’s just one of many new perspectives that are informing his role as leader of the Detroit Chamber of Commerce. And if ever a chamber had a hard sell to make, Detroit has to be it.
“That’s why I’m here,” Baruah, who took the Detroit job in the spring of 2010, explains. “I like a challenge, and Detroit faces significant challenges, both on the ground and in the media.”
Chrysler and rapper Eminem took a gritty-but-proud approach to that media challenge with their 2011 Super Bowl commercial—the first positive bit of Detroit messaging in years—but, for Baruah, marketing isn’t the answer.
“I’m just focused on fixing the fundamentals,” he says. “Here’s where we stand: The economy here has bottomed out and we’ve turned the corner. The bleeding has stopped. I think it’s stunning how quickly the auto industry, particularly the Ford Motor Company, has executed what I believe to be the most impressive industrial turnaround in history. From zero to hero in record time. And while we understand that everyone associates this city with the auto industry, everyone is working very hard to diversify this economy. We have tremendous assets—this is the engineering mecca of the planet, with the highest per capita population of engineers in the world. We also have amazing technology and financial resources here. And we have a whole new slate of leadership in the state, which is having a profound impact. A new city council, new mayor, and new governor are bringing new ideas.
“An entire generation has come of age in Detroit knowing nothing but a shrinking pie. Here at the chamber and throughout the region we are doing things radically differently than before, beginning with the decision to stop asking how we manage a shrinking pie and start focusing on baking a bigger pie.”
So how to turn it all around—or, if it has turned, to keep it going?
“We have to fix the fundamental problems of government inefficiency,” Baruah says, “and recalibrate how we go after new business and new investment. We have been a business-unfriendly state, no question, with a complicated tax code and an inconsistent message. We are now fixing those things.”
Unlike several chambers of commerce around the country, the Detroit chamber hasn’t declared open war on labor unions as part of its probusiness stance.
“I’ve reached out to unions, which I believe are an important deterrent to the rare cases of businesses abusing workers,” Baruah argues. “We need more collaboration—we have historically been divided in Detroit: union versus management, Black versus White, Ford versus GM . . . that has to end. There are probably a zillion political things I would disagree with my union friends about, but that doesn’t mean we can’t work together on a host of issues. We don’t want to put unions out of business, we don’t want to end collective bargaining rights—what we’re saying is that we have really tough choices to make, and business and government need flexibility, need the ability to get things done. All parties must understand that.”
Baruah sees two very different inspirations for a new Detroit: Pittsburgh and Oregon.
“In 1980,” he says, “Pittsburgh’s economy revolved almost completely around the steel industry. Today they have diversified, and steel is less than 30 percent of their economy, and the new steel industry is both more productive and more profitable. I think we’re already seeing that in the auto industry.
“And what we can learn from Oregon, which will always be my real home, are the same things I learned growing up there: first, an abiding respect for civility and bipartisanship; second, the value of the environment—and I don’t mean that in just a let’s-hug-a-tree way, I mean the day-by-day beauty of a city like Portland and the competitive advantage that comes from that—and third, the entrepreneurial spirit. The companies we celebrate in the Northwest, like Nike and Microsoft, are my generation’s Ford and GM. In Oregon and the Northwest we’re surrounded by independent entrepreneurs and the spirit that drives them. That spirit is now returning to Michigan. It was dormant for a long time, because we had big business, big labor, big government, big everything. This region is realizing that big isn’t the wave of the future, and we are poised for another renaissance.”
Baruah hears a new Motown sound—much less “Aint Too Proud to Beg” and much more “Let’s Get It On.”
Todd Schwartz ’75 is a Portland writer who believes in teaching people to fish—and giving them a couple fish while they’re learning so they don’t starve.