1960s race riots in Detroit led to 'white flight', which caused businessmen and businesses to leave the city other than the well established that couldn't leave because of long-term leases with the city (GM, Ford). Managers that now lived in the burbs made place of residence a factor when deciding to hire other employees - led to declining wealth in the major city and increased purchasing power in the burbs.
Imagine Toronto having serious rioting and anarchy (other than the G20) and businesses leaving. They would go to the 905 and the 416 would be in a similar situation.
There are a lot of other factors (google Coleman Young and Kwame Kilpatrick - two hilariously bad / criminal former Detroit mayors) and there have been many mistakes in the city, but that's a bit of synopsis of why its like that.