Michigan is the result of a slow-motion geological cataclysm, having been formed two million years ago when a glacier swept down from the north, carving out the Great Lakes on three sides of the state, and grinding the flat topography of the middle west. Michigan has the largest amount of waterfront of any sovereign entity in the world not located on an ocean: it has 3,250 miles of shoreline along four of the five Great Lakes, accounting for nearly 60 percent of the total Great Lakes shoreline. Michigan also boasts the world's largest living object, a nearly 40-acre fungus growing under a forest floor in the Upper Peninsula that scientists think could be 1,500 years old.

Michigan is also America's paradigmatic industrial state. Michigan has been the scene of large-scale man-made transformations of the natural environment as well as the engine of the American economy. Lumber was the first big industry in Michigan in the nineteenth century, with thousands of acres clear-cut for timber and to make way for agriculture. Then in 1881, a wildfire burned half of the "thumb" area near Saginaw Bay. Late in the century large copper deposits were discovered on the Keweenaw Peninsula. In the twentieth century, Michigan also became a center for chemicals and machine tools.

But Michigan is best known for the auto industry. Detroit is one of those rare cities whose very name symbolizes a major industry—automobiles—in the same way "Hollywood" denotes the entertainment industry. Some environmentalists regard the automobile as public enemy number one.9 Yet the auto industry has been at the forefront of efforts to apply technological innovation to the problem of reducing air pollution. New automobiles today emit less than five percent as much pollution as they did at the time of the first Earth Day in 1970, a fact that accounts for a large portion of the improvement in air quality. To be sure, the federal government mandated much of this innovation, with the auto industry protesting that rapid breakthroughs might not be feasible or affordable. More recently, however, there are signs that the auto industry is beginning to look farther ahead than legislation can contemplate. Experiments with fuel-cell and other cutting edge technology suggest that zero- or near zero-emission autos are within the foreseeable future. In the meantime, Volvo has introduced a car equipped with a radiator covered in a specialty coating that purportedly converts ozone smog into oxygen at rates that exceed the ozone-forming chemicals emitted by the car. In other words, driving this car will actually clean up the air. The specialty coating is currently expensive and not yet affordable for the mass market, but it is an example of the kind of innovation that industry is now developing on its own.

This long history makes Michigan an ideal laboratory to see how the modern economy has transformed humanity's relationship with the environment. What is especially notable about Michigan's progress over the last 25 years is that it has been able to achieve significant improvements in its environment while suffering through a wholesale restructuring of its economy amidst energy shocks and recession. Twenty years ago employment in the auto industry started plummeting, and Michigan was viewed as the capital of the "rust belt." It is at such times that environmental progress is thought to be at risk, because a shrinking economy cannot afford the expense of regulation. Yet Michigan proved to be highly adaptive. In the 1990s, Michigan's unemployment rate was below the national average, even though auto industry employment is little more than half as much as it was 25 years ago. And, as this report discusses, Michigan has enjoyed considerable environmental improvement.