Ahead of the dead-man's curve

Detroit could be bellwether for the rest of our nation

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Two of America’s major cities have been hit with major disasters in recent years: New Orleans and Detroit.

One was hit by nature. The other, by human nature.

Our friends in the Crescent City were given only a few days’ notice before Katrina struck. Our friends in the Motor City have seen their financial storm coming for years.

Yet – odd as it seems, for as poorly as things went in New Orleans – folks there actually prepared better than in Detroit.

Last week, after decades of decline, denial, division and decadence, Detroit filed for bankruptcy – the largest municipality in the country to do so.

Now, bankruptcy is not in itself a disgrace. The question is what caused it and whether any learning has gone on.

In Detroit’s case, we’re afraid the answers are not encouraging.

Even as American automobile manufacturers were outmaneuvered and outdated, the city that depended on the industry so heavily failed to adjust properly. Just like the auto industry, Detroit is now shackled to fat union pensions and other unfunded liabilities adding up to $20 billion – the bill for decades of unrealistic promises to unions and retirees.

Corruption and negligence helped make the math even even worse. Today, the city that was once America’s fourth-largest has bled over 60 percent of its population. As one report noted, it’s as if the entire population of Dallas, Texas, had up and moved out of Detroit.

If Detroit were a nation, it might be considered Third World. Besides the crushing debt, there are nearly 80,000 abandoned houses – and a report a couple years ago said 47 percent of the population there is “functionally illiterate.” It’s said that 40 percent of the streetlights are dark. The official unemployment rate is some 16 percent, double the nation’s – and truth be known, that’s probably understating the case.

In 2012, Detroit topped the list of America’s most dangerous cities for the fourth year in a row, with a violent crime rate five times the national average.

“Almost a third of the city’s 140 square miles is vacant or derelict,” London’s Daily Mail wrote in 2011.

A recent conference was titled “Are We Rome?” – as in, is America in danger of collapsing?

Well, look at Detroit for a clue.

“What the average Detroiter needs to understand is that where we are right now is a culmination of years and years and years of kicking the can down the road,” city Emergency Manager Kevyn Orr said recently.

The same could be said about the country as a whole. The federal government is doing the same thing as Detroit – with $17 trillion in actual debt and likely over $100 trillion in unfunded future liabilities – while The Pew Center for the States reports that public pension plans were underfunded by $1.4 trillion in 2010. All told, states are said to have unfunded liabilities of over $3 trillion.

Detroit may just be ahead of the dead-man’s curve much of America is on.

But boy, is it ahead of the curve.

“Detroit earned its bankruptcy the easy way – through greed, the desire for political power and poor planning,” writes Douglas A. McIntyre, a financial editor and child of Detroit.

There are two cautionary tales for the rest of America.

One: stop doing what led to Detroit’s collapse.

Two: Don’t even think of bailing out such irresponsible cities and states.

Comments (62)

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deestafford
18397
Points
deestafford 07/25/13 - 12:46 am
11
2

Detroit started going down hill after the race riots of the 60s.

After the riots, the white people saw their businesses destroyed by the rioters and said to themselves,"We don't have to put up with this lawlessness!" and they moved out.

As the white flight took effect Detroit became a majority black city and elected as its first black mayor a leftist, black separatist named Coleman Young. He was a man who loved conflicts and wanted to fight one everyday. He wanted total control and called himself the "BMFIC". Young set the standard and as a result, the city fell into a cycle of leftist, corrupt, incompetent democratic leaders.

That, accompanied by the generous union contracts, brought Detroit to its knees.

With the city being in the throes of bankruptcy you would think the city council would be working on ways to solve their financial situation, but you would be wrong. What was the first and longest discussed item on its agenda this week? It was developing a resolution to send to Washington, DC telling them to investigate George Zimmerman!

And one wonders how they got into this mess? Look at the cities who will follow and you will see the nearly the same pattern.

carcraft
20738
Points
carcraft 07/25/13 - 04:13 am
8
2

LETS LOOK AT WASHINGTON D C

Wal-Mart wants to move in and set up stores to lower prices for shoppers and provide jobs. The Governing council of the District decides to help unions at the expense of the people they represent. The council votes in a law specifically targeting Wal-Mart. This vote tells other non-union businesses "NO NEED TO APPLY". This is going to kill lower priced goods and job growth in an area that desperately needs it.

President Obama in a node to the teachers union, ended the voucher program in DC that allowed some poor inner city children to get a decent education. Failing schools and high numbers of single parent families are condemning families to poverty for generations.

The economic ignorance of the people allows them to be sold BS that lets the race hustlers and clowns on the city council try to shake down companies like Wal-Mart.

AS companies and any body who can (white flight is a myth, call it intelligence flight, blacks that can, leave to) leave allowing the city to spiral into further ruin fueled by ignorance and a diminishing economic base.

Crime increases further causing those that can to leave, worsening the situation....

carcraft
20738
Points
carcraft 07/25/13 - 04:17 am
7
2

Oh lets not forget

I think during one of the debates Obama said Detroit would not go into bankruptcy, it is sorta like the sequester , GITMO and the other long list of broken promises! But who cares? You can get free birth control, that some one else pays for, sorta like the higher wage jobs that will come into if Wal-Mart is not allowed in...

Riverman1
70696
Points
Riverman1 07/25/13 - 04:44 am
10
1

Hard Core Pawn

Ever watch Hard Core Pawn that takes place in Detroit? I fully expect one day the mayor of the city to arrive by cab, walk in the pawn shop, wait in line and try to pawn what assets the city may have left. Les won't offer him much. Ashley may give him a little bit. She's a softie.

By the way, what's the name of that pawn shop on Broad St.? Richmond County may need it later.

Riverman1
70696
Points
Riverman1 07/25/13 - 05:56 am
5
2

Let's Not Be Too Smug

Georgia's and South Carolina's healthcare benefits for state employees are both vastly underfunded. This will be enough to bankrupt the state governments of both states in the not too distant future. The only answer is to default on the promises.
http://www.pewstates.org/uploadedFiles/PCS_Assets/2012/Pew_Pensions_Upda...

Rhetor
862
Points
Rhetor 07/25/13 - 06:23 am
4
15

well...

The alternative explanation is that a hostile state government, dominated by Republicans, changed the state's tax laws so that taxes from economic activity in Detroit would be shuffled to the suburbs rather than to Detroit. Thus, Detroit produced the wealth, and the rich suburbs cashed it in. So, if we want to avoid the mistakes that caused this debacle, vote Democratic. Have a nice day.

ultrarnr
875
Points
ultrarnr 07/25/13 - 06:32 am
0
0

Fat Pensions

Unpublished

The average pension for Detroit workers is $19,000 per year. Is that living large.
?

Humble Angela
41338
Points
Humble Angela 07/25/13 - 06:57 am
11
3

Rhetor.....can you show us

Unpublished

Rhetor.....can you show us some evidence that your theory is true?

Riverman1
70696
Points
Riverman1 07/25/13 - 07:21 am
9
2

"The alternative explanation

"The alternative explanation is that a hostile state government, dominated by Republicans, changed the state's tax laws so that taxes from economic activity in Detroit would be shuffled to the suburbs rather than to Detroit."

Yeah, I'm curious, too. What type state laws were changed to move economic activity to the suburbs?

Humble Angela
41338
Points
Humble Angela 07/25/13 - 07:23 am
9
3

If you say it enough times,

Unpublished

If you say it enough times, it must be true....right?

seenitB4
72837
Points
seenitB4 07/25/13 - 07:38 am
6
3
chascushman
6653
Points
chascushman 07/25/13 - 07:45 am
6
3

"Rhetor.....can you show us

Unpublished

"Rhetor.....can you show us some evidence that your theory is true?"
HA, it seems the followers of the racist commie the WH follow his example, Keep telling the lies and some people will believe them.

Humble Angela
41338
Points
Humble Angela 07/25/13 - 07:50 am
9
3

Yeah...just yesterday he told

Unpublished

Yeah...just yesterday he told us that all of his scandals are "phony?" I bet the families of the dead in Libya don't think it's phony.....but if the O says it's so, it must be.

seenitB4
72837
Points
seenitB4 07/25/13 - 07:55 am
8
2

Too bad he can't go to trouble spots

I wish Pres O would venture into Chicago or Detroit inner city & give his speech there....tell them what he is doing for them to prosper....forget about the college crowd.....I wonder why some of the blacks don't get upset when he forgets them.

deestafford
18397
Points
deestafford 07/25/13 - 08:15 am
7
2

I wonder where the president gets this economic theory and would

he show some examples where an economy has "grown from the middle out". It is not a proven or practical economic theory. It is the concept of equitable distribution and hate the rich which is the foundation of the marxist doctrine.

This just is another example of how inept this man is for the job. Neither he nor anyone in his cabinet ever run a business and it is the same situation with those on the Detroit city council.

carcraft
20738
Points
carcraft 07/25/13 - 08:20 am
7
3

When the history is written

When the history of Obama's era is written "Incompetent & Corruption" will be the Chapter title!

carcraft
20738
Points
carcraft 07/25/13 - 08:24 am
6
3

Funny, as we watch Washington

Funny, as we watch Washington DC follow Detroit we don't hear any BS about moving jobs out of the city etc. Companies can't even move jobs into that city because of big union influence...LOL

soapy_725
43306
Points
soapy_725 07/25/13 - 08:34 am
0
0

Didn't Augusta have a riot in May 1970? Deja Vu?

Unpublished

Didn't Augusta have a riot in May 1970? Deja Vu?

soapy_725
43306
Points
soapy_725 07/25/13 - 08:35 am
0
0

Didn't we have white filght to CC? CBD decline?

Unpublished

Didn't we have white filght to CC? CBD decline?

rmwhitley
5083
Points
rmwhitley 07/25/13 - 08:56 am
0
0

Someone give

Unpublished

rhetor a nudge. I think he/she has fallen asleep, again.

Young Fred
13778
Points
Young Fred 07/25/13 - 08:59 am
7
2

carcraft

For that title to be complete, you'll need to add "disgraceful".

Never mind, if one were to use all the applicable adjectives to describe this administration, the title would be a page long!

David Parker
7919
Points
David Parker 07/25/13 - 09:14 am
4
0

Join the LP and be done with

Join the LP and be done with both.

corgimom
19339
Points
corgimom 07/25/13 - 09:29 am
5
4

"I think during one of the

"I think during one of the debates Obama said Detroit would not go into bankruptcy,:

No, carcraft, that's not what he said. In a speech he said that Detroit was saved from BK, referring to the automaker bailouts.

He was referring to the economy of Detroit, and to the residents of Detroit- because the economy of Detroit IS the car makers- and was not referring to the City of Detroit, the municipality.

There was never a bailout of the City of Detroit.

corgimom
19339
Points
corgimom 07/25/13 - 09:37 am
7
4

. Companies can't even move

. Companies can't even move jobs into that city because of big union influence...LOL"

DC is 61 square miles. To compare, RC is 307 square miles.

And Walmart said they would pull out of DC if the city passed a super-minimum-wage law, the proposed law said this- "The D.C. Council bill would require retailers with corporate sales of $1 billion or more and operating in spaces 75,000 square feet or larger to pay their employees no less than $12.50 an hour. The city’s minimum wage is $8.25."

The bill passed. And this wasn't about unions, it was about Walmart and profits.

Nobody said that WalMart can't come in there. They are welcome to come in there, they just have to operate smaller stores.

Big-box retailers aren't necessarily good for municipalities. When they move, they leave that vacant storefront and it creates blight.

Like malls. That's one of the reasons why malls aren't built anymore.

nocnoc
31024
Points
nocnoc 07/25/13 - 09:45 am
7
2

47 percent of the population there is “functionally illiterate.”

Answer me this:
What reason would this 47% or any group have to learn beyond basic math if, just about everything they need is given to them?

A vast majority of these functionally illiterate, are/were being spoon fed by the local, state and federal governments. If they couldn't read to sign up or sign their names, the civil groups, unions, Socialists, or Liberals supplied a person to do it for them. It has been documented a few of these same "Helpful" groups even voted for them if they could not get to the polls.

For any city to work with a reasonable tax rate, it must have a tax base that has at least 80% taxpayers, or less than 20% total tax takers. Plus it must have elected officials that understand non-taxpayers cannot be given everything they want, if they are not giving or doing anything in return.

Every society has its poor groups, even the communists, Fascist, socialist dictatorship, progressives and America is no different.

Basic care, food and housing for those that can't work, due to officially documented reasons, is a basic function of any humanly run government.

But when 47+% decide to sit on its hands, it is time to draw a line.

I believe in Workfare, not Welfare.
In Detroit it was past time to start interviewing every person on the dole.
Then start determining who goes on WORKFARE, Welfare,
or gets 6 months warning and training to do a basic job.

But, the problem is too many big cities politicians fear the word

"Responsibility".

An too many social engineering liberals/socialists/progressives, want to deleted the word entirely from our language. Other than when it is used as being responsible to government leaders.

In short, the 1960's LBJ - Great Society experiment needs to end.
It has failed and only harmed the minority community.

We need 1 man 1 vote, with the same level of Responsibility for all.

nocnoc
31024
Points
nocnoc 07/25/13 - 09:56 am
5
2

Want to better understand what happened in Detroit

and could very well happen to ARC, if steps are not taken?

Then grab a copy of: "Devil's Night: And Other True Tales of Detroit "
by: Zev Chafets

"...the majority of white Detroiters, high-tailed it out of town after the 1967 race riot. Shows "the first major Third World city" in America is an enormously unsettling read and a tragically accurate picture of a dying metropolis. "

It is based on personal observations and interviews with local citizens and officials. An since perception is paramount to grown and stability, it draws on WHY things happened the way they did in Detroit.

There are many parallel paths between Detroit and ARC on a smaller scale. This could be where ARC is headed, if steps are not taken.

Humble Angela
41338
Points
Humble Angela 07/25/13 - 09:59 am
6
4

Minimum wage at

Unpublished

Minimum wage at $8.25....hmmmmm. How did that help out in DC? Several hundred people will now get $0.00 per hour because of the new minimum wage. I'm sure they are happy about that.

nocnoc
31024
Points
nocnoc 07/25/13 - 10:19 am
9
3

"This is a city that's been

2011 "This is a city that's been to heck and back," Obama said. "And while there are still a lot of challenges here, I see a city that's coming back."

Note: Obama did not cause them to go bankrupt, 60 years of liberal democrat bad governing did that, even before he was even in office.

But he did say this.

2012 "we refuse to allow Detroit to go Bankrupt..."
http://www.youtube.com/watch?v=V6Su5mjQSaE

deestafford
18397
Points
deestafford 07/25/13 - 10:27 am
5
3

As far as WalMart costing jobs and store closing when it comes

into an area I think it's just the opposite. If one looks at the WalMarts in Aiken, North Augusta, Evans, and Bobby Jones Expressway one will see a lot of small business set up in an area that was open land before WalMart moved in. Businesses build up around the big stores such as WalMart, BassPro, Cabel's, etc. I have visited a number of Bass Pro Shops around the country, some right after they opened and then again years later, and each location has many businesses built around them. In some cases shopping malls tied in and built on to Bass Pro. In one case in Dallas Embassy Suites tied in to Bass Pro.

So, it's a myth not backed by facts that WalMart costs jobs. Granted, some small businesses will close but there is a net gain.

allhans
21960
Points
allhans 07/25/13 - 10:34 am
3
2

--------Tot.Tut. Posters.

--------Tot.Tut. Posters. Read the above comment by nocnoc, the truth will come out.

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