Coming to Terms: Using Contract Theory to Understand the Detroit Water Shutoffs
Marissa Jackson Sow
After the City of Detroit underwent financial takeover and filed the largest municipal bankruptcy in American history in 2013, the city’s emergency manager encouraged mass water shutoffs as a way of making the city’s water utility a more attractive asset for sale—and for privatization—by ridding the water department of its association with bad debt. The sale never took place, but the water shutoff, too, became the largest ever in American history, with over 141,000 homes subjected to water disconnections over a period of over six years. The governor of the State of Michigan ordered that the shutoffs be temporarily suspended for the duration of the COVID-19 health emergency in March 2020 and that water be restored to homes that had been disconnected from water services.
Human and civil rights activists and health officials have long sought the end of the shutoff campaign for several reasons: It disproportionately impacts Black people, subjects residents to subhuman living conditions and serious health risks, and remains ineffective at redressing the underlying problems that prompted the shutoff in the first place. For attorneys and activists advocating on behalf of Detroiters, pleading violations of civil and human rights laws, however, has proven unavailing in the courts, as well as at the seats of local or state government; even condemnations from the United Nations did not convince the City of Detroit or the State of Michigan to put a permanent end to the water shutoffs, their lack of success and high human cost notwithstanding.
This Essay articulates a radical theory of contract to clarify the relationships between the people of Detroit and the local, state, and federal governmental bodies exercising jurisdiction over them and to explain why the shutoffs persist. A racial contract exists amongst Michigan’s white body politic, which seeks the exploitation of Black people and resources—including Detroit’s water. Performance of the contract requires the dehumanization and exclusion of Black Detroiters in order to establish and maintain a rent-seeking order in which Black people effectively subsidize the delivery of water and sewage services to white suburbanites who view Black governance and Black proprietorship as a breach of the social order for which the suburbanites bargained. The City of Detroit has been able to rely on anti-Black narratives and beliefs to create the mirage of a contractual relationship with Detroit residents that Detroiters have breached; in reality, however, because of the racial contract, Black people lack the capacity to enter into bargained-for agreements with their local government; rather, the City of Detroit and the regional water authority have contracted amongst themselves, treating Black people’s use of water as an externality resolved through taxation.