Deadbeat City

Saving Detroit From Itself - A federal bailout would only reinforce the city's corrupt political culture.

Detroit's decline really began with the middle-class migration to the suburbs in the 1950s, which accelerated after the 1967 race riot and election of labor organizer Coleman Young as mayor in 1973. During his 20-year reign, Mr. Coleman ignored crime, inflamed racial tensions and built a patronage machine.

Local politicians bought union support with generous labor agreements. Pensions were sweetened retroactively. In good investment years, retirement funds issued bonus checks. Until two years ago public-safety officers didn't have to pay a penny to their pensions and could retire at 55 with roughly 85% of their salary, a 2.25% annual cost-of-living increase and nearly free health benefits.

.... Misrule has resulted in the nation's highest violent crime rate, worst schools, blight and corruption. A former mayor, city treasurer and several pension-fund trustees were recently indicted for corruption.

..... Unions say it's not fair for the city to break promises to workers, though it long ago abrogated its social contract with local taxpayers to protect their safety and provide basic public services. What would really be unfair is to make taxpayers in cities like San Jose, California, and Providence, Rhode Island, which have scaled back current worker pensions to avert bankruptcy, pay for Detroit's recklessness. As history shows, sending more cash to Detroit won't fix its breakdown in self-government. Another bailout would merely support its toxic political culture of neglect and corruption.
Comment: Should not receive a federal bailout! As an aside ... the old Sim City simulation on saving Detroit was un-winnable (at least by me!).

  • Tear down blight (with delay)
  • Sell the art collection. It's symbolic! Sell the Howdy Doody and one of the first Mustangs
  • What not destined to be permanently undeveloped, have an Oklahoma-style land run. Lots are free if one builds on and lives in for 10 years.
  • Create tax-free manufacturing zones (20 year)
  • But no federal bailout!


  1. Detroit Bankruptcy a “Game-Changing Event,” Meredith Whitney Says:

    “We know [Detroit’s bankruptcy] is a game-changing event for certain,” says Whitney, author of Fate of the States and founder of Meredith Whitney Advisory Group LLC. “It will galvanize other municipalities to either get their act together or follow Detroit’s lead.”
    Asked what other municipalities might follow Detroit’s lead into bankruptcy, Whitney cited the five other Michigan cities currently under emergency management: Flint, Pontiac, Ecorse, Allen Park and Benton Harbor. She also reiterated her concerns about the states of New Jersey and Illinois.

  2. Stadiums are a great picture of big city finances, as nobody ever seems to do an honest ROI calculation to figure out that the average ticket price is exceeded by the annualized cost of the subsidy.

    In other words, the whole city needs to take it in the shorts, or this will happen again. This includes the politicians who negotiated the deals, the unions who didn't hire an actuary to figure out if it was tenable, and the voters who elected the nincompoops who did this to them. The Mustang and Howdy Doody need to go, too.


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