Detroit files for bankruptcy

[Valin]

The Hill:

 

Daniel Strauss

07/18/13

 

The city of Detroit filed for Chapter 9 bankruptcy on Thursday afternoon.

 

Detroit's emergency manager, Kevyn Orr, filed the request to begin what will be the biggest municipal bankruptcy in United States history.

 

The decision to file for bankruptcy required the approval of both Orr and Michigan Gov. Rick Snyder ®. Orr was appointed by Snyder to try and salvage the city's finances, which reached a crisis point amid a steady decline in population and tax receipts.

 

(Snip)

 

At this point experts are not sure how this will affect the outcome of the George Zimmerman verdict. Stay tuned for Rev. Al's deep insightful analysis.

[Casino67]

Results for #NewDetroitCityMottos

 

https://twitter.com/search?q=%23NewDetroitCityMottos&src=hash

 

 

MN_CONSERVATIVE ‏@LIBSRSCUM 52s
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Justin Boyle ‏@boyle301 54s
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How do they separate the men from the boys in Detroit?

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MN_CONSERVATIVE ‏@LIBSRSCUM 1m
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Just Like the water in Mexico, only browner.

 

[Valin]

Detroits Failure and the Blue Models Shame

7/9/13

 

If Detroit were a country, it would fit comfortably into the Failed States Index. The NYTs front-page analysis today asserts that the citys daily struggle to survive is worse than the estimated $18 billion in debt, worse than the potential fire sale of the citys art, its parks, and its airports. Detroits residents can no longer count even on the most elementary social services: people have started to plan for a life in which the paramedics and police just stop showing up.

 

(snip)

 

Make no mistake: when your city cant find enough money or manpower to fulfill the minimum requirements of law enforcement and emergency response, you live in a failed enterprise. When citizens try to treat medical emergencies themselves, carry handguns in public parks out of fear, and lose faith in public officials faster than those officials can resign, you dont just live in a city with a debt problem; you live in a social and political cataclysm for which the label free society is wholly inappropriate.

 

This is one of the most traumatic and heart wrenching stories unfolding in American life today. The NYT has been covering it more as of late, but the MSM and Democratic coalition generally have failed to give it the attention and concern it deserves. Decades of blue policies and corrupt, one-party machine politics created this mess. Those who cheered it on while it careened off a cliff should at least be forced to look at the wreckage down below.

[Casino67]

Barack Obama ‏@BarackObama 1 Sep

President Obama on Romney: “When his advice was to ‘let Detroit go bankrupt,’ I bet on American workers and American manufacturing.”

[clearvision]

It is not like this was an iconic city of the USA's industrial might.

[quantim]

This what I just posted on EG:

 

++++

 

It's a beautiful thing!

I will of course answer any questions to the details, do NOT believe what you read.

100 years ago Detroit was the wealthiest city in the world, not even a LIV would argue this.

50 years ago Detroit pulled together enough manufacturing prowess to defeat the Nazis.

Once 'peacetime' arrived, the weak GOP started sleeping with the rats as everyone was on a check from gummint.

Detroit became an outpost as racist mayor Coleman Yong basically told whites to move out and they did.

And then you had the Detroit Riots of '67 and it was over.

All whites that could leave left the city.

Detroit went from a 2/10ths of a billion people after WWll and now she can barely scrap up 700,000 and that's with cheating.

I don't blame blacks, immigrants, democrats, unionists, etc. so much.

I blame all those crusty old WHITE national GOP party republicans the last few decades who went along to get along who share the same bed as the rats to destroy the black family through welfare, handouts all that.

 

Making them rich.

And now Hispanics.

And Boehnor is leading that charge again.

I wonder how many other federal created ghetto cities are now going to go bankruptcy because of this Detroit mess?

Kenyan's Kourts are really going to get a workout now.

But by God I have faith, and Detroit like the Pheonix shall rise from the ashes...since the money people and capitalists are moving in and acting like cannibals, and it's working already.

Downtown Detroit (waterfront) has almost total occupancy.

Kiddoes (white people) are grabbing up multi-thousand sq/ft lofts for a song downtown, less than trailer park rent out here in the boonies and investing $$$, there appears to be a huge tech bubble in Detroit, but only the smart ones are getting jobs.

Like University of Michigan Engineering graduates...making six-figures out of college.

You get through that program...I cannot imagine. You earned every penny

The democrats, liberals, unions, leftists, etc. are completely powerless in Michigan to do anything.

[Valin]

UAW: AWOL

GEOFFREY NORMAN

11:24 AM, Jul 19, 2013

 

One would think that of all interested parties, the United Auto Workers would have something to say about the sad fall of the city of Detroit. There is nothing, however, on the union's website.....(Snip)

[Valin]

Must there always be a Detroit?

James Pethokoukis

July 19, 2013

 

Photo galleries and slideshows showing Detroits decay are always great Internet click-bait. (Maybe second only to shots of the soulless Pyongyang.) The pictures look like stills from one of those Life After People speculative documentaries. Unfortunately, lots of people still live in the Motor Citys urban ruins, some 700,000 of them, down from a peak of 2 million in the 1950s.

 

They live in a city with not much to show for its nearly $19 billion in debt, other than the biggest US municipal bankruptcy filing in the countrys history. As Reuters reports, 1) the citys murder rate is at its highest in nearly 40 years, 2) only a third of Detroits ambulances were in service in the first quarter of 2013, and c) an estimated 5,000 buildings a year intentionally are set on fire.

 

(Snip)

 

Good luck returning Detroit to what it once was through government-created innovation hubs. I havent found one example of an innovation hub in the US that has been created by deliberate policy that says, Were going to create an innovation hub here, Moretti says. Instead of a top-down effort, better to create the organic conditions that will draw those smart, wealthy, entrepreneurial folks Glaeser writes about especially immigrants to Detroit. Maybe turning Detroit into a sort of Hong Kongesque tax haven one with decent schools and safe streets to encourage startups and a more diverse economic base than relying on one manufacturing sector. At best it will be a long slog with no guarantee of success, but the odds will be a lot better with policies that invest in people rather than things.

[Valin]

Detroit's disaster: A once-great city's collapse is a cautionary tale

Pittsburgh Post-Gazette

July 21, 2013

 

Nobody should be surprised that Detroit has become the largest city in U.S. history to file for municipal bankruptcy. Detroit is virtually out of cash, an eye-popping $19 billion in debt, and -- for its own good -- no longer able to borrow more.

 

The city's emergency manager, who tried to negotiate with creditors, might have waited longer to file, but his hand was forced when he learned that city employees and retirees were about to seek an injunction to bar a bankruptcy filing. On Friday, a state judge ordered him to withdraw the bankruptcy petition, claiming the state law that authorizes it violates Michigan's constitution.

 

(Snip)

 

Let's hope that Detroit can emerge from bankruptcy in a position to start over as a place that can provide services for its residents, attract growth and pay its bills. Pittsburghers -- and residents of every other city -- should study what has happened to one of the nation's great cities, and use Detroit's example as a cautionary tale.

[Casino67]

All of this discussion about a city. What is it going to be when California goes under?

[Valin]

All of this discussion about a city. What is it going to be when California goes under?

1. Gary, Indiana: The New Detroit?

 

2. Ten States Now Buried by Pensions

 

3. You might look at Ill. also

 

4. If/When Ca. goes under? Do the words thermonuclear explosion ring a bell.

 

 

But I bring good news. Ed Schultz and Bernie Sanders explain it all to you.

[Casino67]

Damn Republicans.

[Valin]

Damn Republicans.

I don't have a problem with Spin, but I do think that at some point reality should enter into it.

[Valin]

Why Chicago is NOT Detroit, But Illinois Is

Jeff Carter

July 19th, 2013

 

Detroit declared bankruptcy yesterday. Depending on which news source you follow, its big news, or its not.

 

Chicago has its own pension and spending problems. But its not Detroit. Detroits economy was based on one industry. It was a one trick pony. Chicagos economy is a lot more diverse than Detroit. Losing an industry leader here would hurt-but not fatally damage Chicago.

 

(Snip)

 

Illinois on the other hand is in deep trouble. There arent enough economic engines in the entire state to support what politicians did to it. Chicago is the only big one. Other towns in the state arent creating wealth at the pace thats needed to make up the pension/public sector spending deficit. Plus, people are leaving the city of Chicago.

 

(Snip)

 

____________________________________________________________________

 

Detroit is just the worst example of a huge problem facing America.

[Valin]

I am forced to point out something very distressing huge major issue facing the nation, I refer of course the George Zimmerman verdict.

[Valin]

Power Line Link-O-Rama

[Valin]

A different kind of People Mover: Lets flood Detroit with immigrants

James Pethokoukis

July 22, 2013

 

Adam Ozimek of the Modeled Behavior blog wants to set up a regional visa system to direct a flood of immigrants to troubled Detroit:

 

 

Yes, an immigrant is made worse off by forcing them to go to Detroit rather than anywhere in the U.S. they want. But right now visas already only allow immigrants to go places where they can find an employer prior to moving here, and then they are effectively tied to that employer. And you dont have to actually restrict the movement of these immigrants; they should be free to travel throughout the country. They will simply be restricted to working in Detroit. Again, visa holders are already effectively tied to working in a particular city as a result of being tied to an employer within that city. Paired with a plan to help regional visa workers who prove themselves get normal green cards also should help reduce concern about limiting mobility. (Snip)

 

Ive been thinking along the same lines, though Ozimek takes a deeper dive. This actually syncs quite nicely with my charter city idea for Detroit since its goal is to attract labor and entrepreneurs to the Motor City with a pro-growth environment. As Ed Glaser puts it: Cities work best when they are filled with smart people and small companies that innovate by exchanging ideas. Even if that means importing them.

[Valin]

Note to Paul Krugman: It Took More Than Markets to Ruin Detroit

7/23/13

 

Paul Krugman wrote yesterday that, despite political and social dysfunction, the fact is that decline happens, meaning the decline of Detroit is actually just one of those things that happens now and then in an ever-changing economy.

 

That perspective is hard to square with the seemingly never-ending torrent of bad news from Detroit. The FT reported today that the citys pension liabilities may be much worse than the $3.5 billion stated in its bankruptcy filing. Years of dubious investments and unrealistic expectations may be hiding obligations that would render the $3.5 billion significantly understated:

 

 

Mr Orr and his advisers claim that about 30 per cent of the investments in the general fund fall into the category of otherriskier, less transparentinvestments, and include real estate transactions and development deals in Detroit itself that lacked sufficient oversight and vetting from professional investment advisers.

(Snip)

(Snip)

 

Krugman is right that Detroit is essentially Ground Zero of the disruptive changes wrought by an economy in transition. But as this story and others like it show, its difficult not to conclude that the city is also the victim of rampant fraud and stupidity on the part of an all-Democratic political machine. Officials decided time and again not to fund the promises they made to city pensioners, and feds and regulators just as often declined to do anything about it. If something this egregious and destructive were happening in the private sector, Mr. Krugman would (rightly, in our view) be all over it, demanding that people go to jail and regulations be tightened. He would want to investigate the ties of influence that allowed serious financial wrongdoing to go on for years without serious oversight. Hed name names and pin shame on the wrongdoers and their political allies.

 

(Snip)

[Valin]

Steins Law

Like Detroit, things that cant go on forever dont.

Charles Krauthammer

7/25/13

 

If theres an iron rule in economics, it is Steins Law (named after Herb, former chairman of the Council of Economic Advisers): If something cannot go on forever, it will stop.

 

Detroit, for example, can no longer go on borrowing, spending, raising taxes, and dangerously cutting such essential services as street lighting and police protection. So it stops. It goes bust.

 

Cause of death? Corruption, both legal and illegal, plus a classic case of reactionary liberalism in which the governing Democrats theres been no Republican mayor in half a century simply refused to adapt to the straitened economic circumstances that followed the postWorld War II auto boom.

 

(Snip)