How business just won in Detroit

August 7, 2013: 11:35 AM ET

The birthplace of the labor movement snubbed a UAW-backed candidate in favor of a former CEO in the mayoral primary.

By Anne VanderMey, reporter

#winning.

Comeback pending.

FORTUNE -- On Tuesday, Detroiters voted in an unusual mayoral primary election. There were 16 candidates, the frontrunner was a write-in, and they were all running for an office that is, at this point, largely symbolic. The bankrupt city is currently under emergency management from the state -- meaning that once in office, the mayor will be virtually powerless.

Voter turnout was low.

But Tuesday's election is still significant, and some ways it represents a seismic shift in Motor City politics. The winner on Wednesday morning was former hospital executive Mike Duggan, who received about 52% of the vote. The runner-up was Wayne County sheriff Benny Napoleon, with 30%. That's a huge spread. Duggan's 22-point victory is even more resounding considering he was kicked off the ballot in the spring and officially pulled out of the race in June before deciding to run as a write-in. Duggan and Napoleon, both Democrats, will face off in the general election in November.

Duggan's victory is remarkable partially because of his race. He's white, and if elected, would be the first white mayor in Detroit since 1974. But what's more surprising are his political affiliations. Duggan is backed by the Detroit Regional Chamber. He is decidedly not backed by Detroit's unions. Both the UAW and the AFL-CIO threw their support behind Napoleon.

What does that mean? The birthplace of the modern labor movement effectively shrugged at its union-backed candidate. Instead, it went with the one who used to be a CEO. Duggan, a Democrat who is known for leading a turnaround of Detroit Medical Center, is even a former Chamber member. To be sure, the UAW took a while to pick a horse. It waited to give Napoleon the nod until Friday of last week. And labor's endorsement could prove more important as Napoleon and Duggan head to the general election.

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But Duggan's primary victory can still be seen as a win for Detroit's business community, which has enjoyed a resurgence in recent years. Thanks in part to big growth at the Detroit Medical Center, a reinvigorated auto industry, and ample cash for development from private benefactors, the city's downtown is booming, even as the residential neighborhoods continue to struggle. It's hard to keep track of the trendy new shop openings, and the city's new Whole Foods (WFM) has exceeded the company's "wildest expectations," according to the chain's co-CEO Walter Robb.

All that will be good news for Detroit's new mayor. The rapid flight of both businesses and residents from the city over the last 50 years decimated its tax base and compounded its staggering financial woes. Detroit recently became the largest municipality ever to file for bankruptcy in the U.S., citing $18 billion in debt and precious little income.

The emergency manager who is currently running the government is likely to leave the job next year. At that point, if all goes according to plan, the next year the new mayor will inherit a solvent city -- or at least what's left of it. It's still unclear how long bankruptcy will last, or what the new mayor's power will be.

It's likely to be significant. Detroit is in a state of flux. Businesses are coming in, but crime is rampant, and streetlights still don't work. Though Duggan is far from an anti-labor candidate (he's a Democrat and has the backing of the Emergency Medical Technicians Union), his election still portends a sea change in the city. With so much change afoot, whichever candidate wins will likely have the ability to substantially reshape the once-great metropolis. Maybe this time, Detroit will make good on that motto: "We hope for better things; it will arise from the ashes."

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