Ann Anomaly: Dissecting the Ann Arbor Bubble


Armenian immigrants in the 1800’s awaiting treatment at the University of Michigan hospital. One of the oldest artifacts in Ann Arbor’s history.

On January 22, 2007, global pharmaceutical firm Pfizer announced it was closing the doors of its Ann Arbor research sites. This announcement was one of the first palpable signs of the oncoming recession, and Ann Arbor was put into a relative state of disarray: the city’s second largest employer had gone defunct. But the resolution came, as it so often does, from the University of Michigan. It purchased Pfizer’s land, and produced more jobs than there had ever been before, essentially bailing out the community, but at the same time procuring a valuable site for cheap. Conan Smith of the Washtenaw County Court of Commissioners spoke to this: “The university was not doing an altruistic thing in taking over that site. But they were doing a good thing for the community.” This is a perfect way to describe the relationship between the city, and the school. This relationship is the foundation for “The Ann Arbor Bubble.”

We are all colloquially familiar with “The Ann Arbor Bubble,” an ambiguous answer for why our city is such an excellent place to live. Although the term usually refers to the very liberal policies of the city and attitudes of the citizens, Ann Arbor is also a fiscal phenomenon. Most people would attribute all of this success to the almost symbiotic relationship between the University of Michigan and Ann Arbor. While many college towns are generally objectively better places to live than others, Ann Arbor somehow manages to excel in every aspect of societal life.

Only thirteen years after the founding of Ann Arbor in 1824, it sought to become the capital of the state of Michigan, donating forty acres to the construction of a state capitol. Ann Arbor’s bid was unsuccessful, losing out to Lansing. The forty acre offering, however, intrigued the University of Michigan, which was located in Detroit at the time; after little debate, the university established itself in Ann Arbor. After this major development started, the city gained massive prominence: to accommodate the university, many developments took place: notably, it became an important stop for major railroads. These railroads brought a lot of commerce, and future inhabitants to the city.

Prior to the outbreak of the Vietnam War, the city was a relatively average place. But the unpopularity of the war managed to indirectly breed the liberal ideology the city is known for: The most common way to dodge the draft was to be a student, because it was the safest way to get out of the war, and there are obvious benefits to getting an education; this led to huge spikes in college populations, and U of M was no exception. With all of these educated youngsters in the city, who were almost inherently opposed to the war, Ann Arbor became very active in protests. All of this civil uproar influenced municipal politics, and eventually the “radicals” were being elected to city council.

Because of this civil evolution, Ann Arbor developed a reputation as a liberal beacon. People started moving to Ann Arbor not just for the university, but for the people, and atmosphere of the city itself. Between the 1960s and 1970s the population increased almost exactly 150% (US Census). This influx of assumed liberals cemented Ann Arbor’s status as one of America’s most leftist cities. All of this was centered around the University, its students and its alumni.

One thing that is still inexplicable is the sudden wealth of the city. However, it is worth noting that during the time that the city has undergone its revolution, college costs have increased ludicrous amounts, the University of Michigan again being no exception. The university is of course a state university, and state institutions are public, so they must reinvest all of their money into themselves. Presumably the redistribution of this wealth has reflected very positively on the city around it. This is only in addition to all of the educated skilled workers who stay in the city after attending the university.

Almost every aspect of Ann Arbor’s uniquity can be attributed to the University of Michigan, directly or otherwise. The university supplies jobs, attracts businesses, attracts highly skilled workers and even absorbs some infrastructure. However, this can be said about many college towns; there are even towns wherein colleges are more ingrained into the city’s identity, and longevity. So what makes Ann Arbor so special?

Luke Forrest, a community planner, and a man who has lived in Ann Arbor at every stage of his life, with many holes between, says that the city isn’t as special as it thinks. “In general, I think for mid-small size cities with major universities this is probably a fairly normal condition,” Forrest said. “I pay attention to demographics a fair amount, as we do research with the census bureau. As people have more mobility, geographically people aren’t as tied down. It’s a phenomena happening across the country where even in non-university towns you see people of the same ideologies, and of similar backgrounds, clumping together, which I think is bad.” So while the city is nice, it is logical to see it develop in this way. The model of Ann Arbor may become more and more commonplace.

The biggest difference for Ann Arbor is its real estate market. The city has one of the hottest real estate areas in the country, people simply want to be here. The biggest factor in our property value is the size of the university. The university takes up a ton of space, and it pays no taxes. And while its citizens may like to think that they live in a fairytale land, where facing no issues, Ann Arbor has its share of civil discrepancies, and they are especially caused by the real estate values.

Residents of Ann Arbor who are receiving or applying for subsidized rent are extremely disproportionately African American. According to the Housing Department’s data, African Americans make up 7% of Ann Arbor’s population, but are 71% of those serviced by the housing department. This statistic says a lot about the city, most importantly it paints a picture of a racially divided city, not a progressive utopia. It also shows that the department serves to diversify the city, yet it is one of the only departments in it that is consistently targeted by budget cuts, rendering the department especially ineffective considering Ann Arbor’s sky high property values. This is a direct contradiction with the identity of the city, and it simply needs to change.

Another point to keep in account is the increasing wealth gap in Ann Arbor. According to the city’s and the county’s annual audits, incomes in Ann Arbor went up 11% during the great recession, while they were plummeting everywhere else around it. And on top of that, everyone’s property values decreased in that time period simply because the property market was shifting downward throughout the country. So Ann Arbor residents were paying lower taxes, and getting income increases, (and they were the people who could afford to live there in the first place). With this information you could argue that the recession was actually beneficial to the city. Smith had interesting points on this as well, saying, “People who are trying to maintain the neighborhoods, they want to keep places around houses like mine from being developed on. People will say, ‘You’re changing my community by approving these developments.’ I always argue to those people that, if you disprove these developments you change the face of the neighborhood, because the same people won’t be able to afford to live here–it results in our city becoming very white, very rich, and that is a loss just like the loss of a physical structure is.” Because the city is simply so excellent it is becoming more, and more demanded; so many people want to live here that all we can do is densify our community. How long will it be until we become a major city, or a playground for the wealthy?

Inconsistencies like these are another thing Forrest wanted to speak to. “We are very progressive on these national issues, but we don’t translate it to the way we design our communities.” In his experience, the city doesn’t actually structure itself in a liberal way. He cites the wards of the city: “The city council wards are drawn so that no student dominated area exists. And only the August election matters, and that’s when they are all gone.” This is a hypocritical policy for a supposedly liberal place, as students are being politically suppressed. To Forrest, it is silly to even have a bubble; he believes it goes against the principles of liberalism, “If you are concerned about a bubble, you should try and pop it as much as possible,” Forrest said. “People outside of the highest classes of wealth should be able to experience a city like this, and people raised here should venture outside of their comfort zones to grow as people.”

The question that still remains is whether or not this bubble will burst, assuming it hasn’t started already. If this reality really can be attributed to the money the university takes in, then it may be soon. The costs of tuition and college living are taking people aback, and a shift in costs has started. Many schools have stopped hiking up tuition, and others have started cutting tuition prices. If this trend continues, we may see a decline in the city, just as we’ve seen such a wonderful growth. If these tuition costs really do have such a clear benefit, perhaps the issue of college costs is not so black and white.