Posted on 07/20/2013 12:46:04 PM PDT by reaganaut1
...
But while Michigan Gov. Rick Snyder has capably overseen Detroit’s march to Chapter 9, neither the state nor the federal government has evinced any inclination to provide meaningful financial assistance.
That’s a mistake. No one likes bailouts or the prospect of rewarding Detroit’s historic fiscal mismanagement. But apart from voting in elections, the 700,000 remaining residents of the Motor City are no more responsible for Detroit’s problems than were the victims of Hurricane Sandy for theirs, and eventually Congress decided to help them.
America is just as much about aiding those less fortunate as it is about personal responsibility. Government does this in so many ways; why shouldn’t it help Detroit rebuild itself?
Many call for scaling back the city to fit realistic population projections. While logical, the potential for downsizing Detroit is limited because the city’s population didn’t flee from just one neighborhood; the departures were scattered, requiring Detroit to deliver services across a geographic area the size of Philadelphia, with less than half the population. Further cuts will surely come, but in some key areas, like public safety and blight removal, Detroit needs to spend more, not less.
That necessitates large-scale reductions in its liabilities, which total as much as $18 billion. By comparison, the country’s second largest municipal bankruptcy — that of Jefferson County, Ala., which is slightly smaller than Detroit in population — involves $4 billion of liabilities.
Detroit faces greater challenges than the automakers because the structure of its obligations is quite different from those of General Motors and Chrysler.
(Excerpt) Read more at opinionator.blogs.nytimes.com ...
I think the city has already been doing that... Operation Move the deck chairs
Too late to save the historic parts of Detroit, they were raised in the 80s to make room for the parking lot of a Cadillac plant, remember?
Cities come, cities go....Adapt or die.
Darwin didn't create it, he just discovered it.
It is nature's way of strengthening the population by rewarding the most successful.
By rewarding the corruption and recklessness of cities like Detroit at he expense of prudent cities, you take away the incentive for cities to live within their means. You incentivize cities go hog wild, secure in the knowledge that somebody else will have to pick up the tab.
The analogy I think of is trying to drown an eel in the town pond.
Whenever Detroit falls off another cliff I feel compelled to repeat this excellent article originally posted in 2009.
http://www.mackinac.org/article.aspx?ID=10743
Posted: July 6, 2009
Detroit: The Triumph of Progressive Public Policy
By Jarrett Skorup
Imagine a city where all the major economic planks of the statist or “progressive” platform have been enacted:
•A “living wage” ordinance, far above the federal minimum wage, for all public employees and private contractors.
•A school system that spends significantly more per pupil than the national average.
•A powerful school employee union that militantly defends the exceptional pay, benefits and job security it has won for its members.
•A powerful government employee union that does the same for its members.
•A tax system that aggressively redistributes income from businesses and the wealthy to the poor and to government bureaucracies.
Would this be a shining city on a hill, exciting the admiration of all? We don’t have to guess, because there is such a city right here in our state: Detroit
Detroit has been dubbed “the most liberal city in America” and each of these “progressive” policies is alive and well there. How have they worked out?
In 1950, Detroit was the wealthiest city in America on a per capita income basis. Today, the Census Bureau reports that it is the nation’s 2nd poorest major city, just “edging out” Cleveland.
Could it be pure coincidence that the decline occurred over the same period in which union power, the city government bureaucracy, taxes and business regulations all multiplied? While correlation is not causation, it is striking that the decline in per capita income is exactly what classical economists predict would occur when wage controls are imposed and taxes are increased.
Specifically, “price theory” predicts that artificially high business costs caused by excessive regulation and above-market labor compensation rates imposed by so-called “living wages” will lead to an increase in unemployment. Detroit’s minimum wage is a whopping $7.40 an hour, more than $2 above the federal minimum wage when it was enacted; and pressure groups are pushing for more. Additionally, any company contracting with the city must pay its employees $8.23 an hour if they offer benefits or $10.28 an hour if they do not offer benefits.
Such high wage mandates are especially hard on individuals with a poor education and low skills. If struggling and heavily taxed businesses cannot pay such high wages, then they are more selective about the few workers they do hire or go out of business altogether. Those who have promulgated these polices may be well intentioned, but mainstream economists have warned for decades that such policies were very likely to bring about the abject poverty and unemployment that characterize Detroit today. The city has the highest unemployment rate among all large U.S. cities. (On a side note, Michigan is home to eight of the 20 cities overall with the highest unemployment and has the highest state unemployment in the country.)
A similar pattern has played out in public education. It is now conventional wisdom among the political class that higher pay for teachers and increased spending per student lead to improvements in teacher quality and student performance. Again, correlation is not causation, but Detroit Public Schools strongly suggests that this theory must be rejected. It has chronically underperformed state averages, yet reforms are vehemently opposed by the system’s powerful school employee union.
At the same time that union, the Detroit Federation of Teachers, has won rich salary and benefits packages for its members. Median compensation for a DPS teacher is $76,000 and Detroit spends the third highest amount of money per student among 76 large cities nationwide. Statewide, Detroit’s spending per pupil is in the 91st percentile and DPS teachers are paid at the 96th percentile. For all that, by almost any measure Detroit schools have for decades failed their students: test scores, safety, drop out rates, etc. For example, Detroit’s public school students perform at the 3rd percentile in the state - that is, they are in the lowest 3 percent, and the district is in its second state takeover in a decade.
In the private sector such failure would result in mass firings for unsatisfactory performance. No doubt such a response would be condemned by the progressives who support the school employee unions that have made similar actions impossible in their institutions, and have opposed major transformation at every turn.
For example, in 2003 philanthropist Bob Thompson offered $200 million to build 15 charter public schools in the city in which he would guarantee a 90 percent graduation rate. In response, the DFT balked because charter schools are not unionized. The outcome was that the union jobs trumped better outcomes for children.
People vote with their feet, and all the above suggests why, over the past decade, DPS has lost about 10,000 students each year to charter, independent and suburban schools.
Of course it would be unfair to place all the blame for the city’s decline on public employee unions. Detroit is home to the Big Three, whose contracts with their own powerful unions provided the model for those public employee arrangements. The UAW successfully extracted wages and benefits estimated at $71 per hour before the recent shake-ups began.
This is about $25 more per hour than the amount foreign-owned U.S. auto manufacturing plants pay their non-unionized American workers. Due to this disparity, Japanese car companies earn some $1,000 to $2,000 more on each car sold than their American counterparts. The outcome has been a relentless loss of market share that, among other things, has devastated the economic engine that once powered Motor City prosperity.
In addition to being a model of progressive economic, labor and education policy, Detroit is also a case study in welfare statism. Tom Bray, former editorial page editor for The Detroit News, has made the following observation:
“Detroit, remember, was going to be the ‘Model City’ of Lyndon Johnson’s Great Society, the shining example of what the ‘fairness’ of the welfare state can produce. Billions of dollars later, Detroit instead has become the model of everything that can go wrong when you hook people on the idea of something for nothing - a once-middle class city of nearly 2 million that is now a poverty-stricken city of less than 900,000.”
Progressives will complain that this portrait oversimplifies the factors involved in a great city’s decline. Perhaps it does, but with this question in mind: At what point does the weight of evidence and logic make it impossible to avoid concluding that in the case of Detroit, correlation is causation?
Screw Detroit. Let it stand as a glittering example of democrat mismanagement.
Too late. I remember reading decades ago about Detroit’s “Witches Night”. People burning down abandoned houses for entertainment. I thought to myself, how stupid and dangerous is it to set fire to your own neighborhood. Where have the Steven Rattners of the World been these years?
Thanks for posting this. Rattner is a moron, but the comments over at the Times site were pretty good. Either they’ve been invaded by a horde of right wingers or even their liberal readers are in no mood to bail out Detroit.
Obama cites the school busing program (used to integrate schools by rezoning white students to black schools and vice versa) to declare that cities must integrate the same way.
Obama then directs the IRS to only accept tax forms from people if they contain the government-assigned zip code for the household. Otherwise, the tax form is rejected and the family is fined or jailed for not filing income taxes.
Move or go to prison.
-PJ
Walking school bus relocation plan
Perfectly capsulizing the Liberal viewpoint and "logic" ... more of the same Rx that got you there in the first place.
Exactly. It would give the unions free rein to demand more from the politicians they bought, all knowing that the stupid taxpayers in States and localities that actually lived within their means will end up paying for it.
The larges employers in Detroit were the city and the school district - govt entities with pension and benefit plans they never should have promised.
So what did the govt unions in Detroit do - they doubled down in spite of warnings that they were heading for big time trouble. No way were the union bosses going to give up their lavish lifestyles.
So now from the rest of us, it’s not NO but h*ll NO.
“While logical, the potential for downsizing Detroit is limited because the city’s population didn’t flee from just one neighborhood; the departures were scattered, requiring Detroit to deliver services across a geographic area the size of Philadelphia, with less than half the population. Further cuts will surely come, but in some key areas, like public safety and blight removal, Detroit needs to spend more, not less.”
The scale of blight removal and overall “downsizing” needed in Detroit will require possible one-off extraordinary use of eminent domain granted by the state, and innovative financing solutions and partnerships with private developers and private investors.
Whole blocks, and in sum whole neighborhoods, will need to be turned into whole empty or ready-to-be-emptied blocks that could be sold as complete tracks for development.
The money to do that - if it is at all possible - will have to come from the private developers and investors (and/or their banks) with whom the city could partner - block by block, or neighborhood by neighborhood.
One thing the city could do to start that process would be to scrap its zoning ordances, forget any utopian “master plan” and let nothing but the willingness of a buyer, for whatever purpose, start getting city properties back into productive hands.
Trying to “save Detroit” now would be like trying to save a heroin addict who refuses to enter detox but insists on you helping him to score another fix and give him some money. Detroit has not hit bottom yet and must do so in order that its corrupt elite and obdurate employee unions and electorate embrace the reforms necessary for the city’s recovery.
Sponsoring FReepers are contributing
$10 Each time a New Monthly Donor signs up!
Get more bang for your FR buck!
Click Here To Sign Up Now!
I love the premise of your comment. We should be asking the liberal Mecca to live by the rules they want to make for others. It's not fair that New York is doing better than Detroit. New Yorkers should have to pay ‘their fair share’ to those left fortunate who live in Detroit. New Yorkers ‘didn't build New York’. Somebody else did. They need to pay back into the system to help other cities.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.