Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Detroitís bankruptcy: A warning to NYC
New York Post ^ | 07/23/2013 | Nicole Gelinas

Posted on 07/23/2013 7:47:14 AM PDT by SeekAndFind

Edited on 07/23/2013 7:47:53 AM PDT by Admin Moderator. [history]

What a difference four decades makes. In the mid-í70s, New York Cityís threat of bankruptcy was a horror that the state, feds and city ultimately avoided. Last week, Detroit declared bankruptcy because Michigan thought it was the best choice ó and Washington stayed silent.


(Excerpt) Read more at nypost.com ...


TOPICS: Culture/Society; Government; News/Current Events; US: Michigan; US: New York
KEYWORDS: bankruptcy; chapter9; detroit; lessons; michigan; newyork; nyc; rosemaryaquillina

1 posted on 07/23/2013 7:47:14 AM PDT by SeekAndFind
[ Post Reply | Private Reply | View Replies]

To: SeekAndFind

2 posted on 07/23/2013 7:48:29 AM PDT by SeekAndFind
[ Post Reply | Private Reply | To 1 | View Replies]

To: SeekAndFind

And Chicago, LA, St Louis, Philly, Baltimore...........


3 posted on 07/23/2013 7:49:01 AM PDT by cripplecreek (REMEMBER THE RIVER RAISIN!)
[ Post Reply | Private Reply | To 1 | View Replies]

To: SeekAndFind
New York - mid 70's.

In the early 80's in the middle of Upstate New York cars still bore bumper stickers reading "Let the Apple Rot". Today I suppose somebody in Michigan might make a few bucks with the motto "Let Motown Go Down (and good riddance)".

4 posted on 07/23/2013 7:55:04 AM PDT by katana (Just my opinions)
[ Post Reply | Private Reply | To 1 | View Replies]

To: SeekAndFind

Bailing out Detroit will be about as effective long term as if the the crew of the Titanic bailed out every bathtub on the ship. The ship and the crew would still be lost. Obama is probably telling the Chinese not to worry. He is not using the money he is borrowing tom”save”Detroit, Bernacke is simply going to print it. Absurdities lead to collapse.


5 posted on 07/23/2013 7:56:22 AM PDT by allendale
[ Post Reply | Private Reply | To 1 | View Replies]

To: allendale

Detroit should not be bailed out but its the least of our problems. Cities with much much larger debts are going to come looking for money at some point.


6 posted on 07/23/2013 7:59:38 AM PDT by cripplecreek (REMEMBER THE RIVER RAISIN!)
[ Post Reply | Private Reply | To 5 | View Replies]

To: SeekAndFind
Detroit:
A DEMOCRAT COLLECTIVE FAILURE

Democrats did it ALL BY THEMSELVES !

Ah ha, ha, ha, ha, ha, ...

7 posted on 07/23/2013 8:03:01 AM PDT by Yosemitest (It's Simple ! Fight, ... or Die !)
[ Post Reply | Private Reply | To 1 | View Replies]

To: cripplecreek

I have little hope for Detroit. They have crashed and will be rebuilt with the same cast of characters in charge. Unlike NYC, and other cities, Detroit’s current population are not tasxpayers. So, after the crash, I see no real possibility of revenue creation. Even if outside business interests move in, they still have a crime-ridden uneducated populace.


8 posted on 07/23/2013 8:04:15 AM PDT by umgud (2A can't survive dem majorities)
[ Post Reply | Private Reply | To 3 | View Replies]

To: umgud

Skipping the usual fixation on Detroit.

Is a magical unicorn going to crap gold coins in America’s cities? Their debt is growing perpetually and there aren’t enough taxpayers in the world to save them from the inevitable. Believing otherwise is just standard Keynesian thinking.


9 posted on 07/23/2013 8:09:10 AM PDT by cripplecreek (REMEMBER THE RIVER RAISIN!)
[ Post Reply | Private Reply | To 8 | View Replies]

To: umgud

Some parallels between Detroit and NYC ( from the article):

* Detroit owes $5.7 billion for retiree health care. New York owes $88.2 billion — and has no money squirreled away. That’s $20 billion more than Detroit when adjusted for NYC’s larger population (NYC is 12 times bigger).

* Pensions? New York owed pensioners $69.9 billion more than it set aside as of last year’s annual report. Adjusted for population, that’s $28 billion more than Detroit owes.

* Bondholder debt? New York owes $77.3 billion. Detroit beats NYC there by about $34 billion — but even that should be a warning, not a comfort. People kept loaning until it was too late to maintain the illusion that Detroit could afford its retirement benefits — and now both groups will suffer.

What about budget deficits?

* Detroit can’t balance its annual budget because it must spend one-third of its revenues on health retirement benefits and debt. Well, New York’s budget has run an operating deficit six of the past seven years (with the shortfalls covered by pre-2008 surpluses).

And NYC spends one third of the budget on health and retirement benefits and debt.

* Detroit lost the auto industry. And New York, half a decade after Lehman Bros. collapsed, is still missing more than 30,000 jobs from its premier industry, finance. The sector’s ranks remain down 7.5 percent.

That’s important, because finance still provides 28.9 percent of New York’s income from wages — and we need the taxes on those wages to keep city services up so the world’s global elite don’t decamp with their cash.

* One difference -— NYC’s median household income, about $51,270 (thanks to Manhattan), is nearly twice Detroit’s.


10 posted on 07/23/2013 8:30:50 AM PDT by SeekAndFind
[ Post Reply | Private Reply | To 8 | View Replies]

To: SeekAndFind

The difference between NYC and Detroit, is that there is tremendous wealth in NYC that can (and will) be taxed to increase revenues - at least in the short run. There is no way for Detroit to increase revenues - there is almost nobody left with any money to tax.


11 posted on 07/23/2013 8:36:47 AM PDT by qwerty1234
[ Post Reply | Private Reply | To 10 | View Replies]

To: SeekAndFind; umgud; cripplecreek; Yosemitest; allendale; katana

While it’s true that there aren’t enough taxpayers in the world to solve the cesspool that is Detroit (and Chicago, LA, Philly, NYC etc.), as a member of the taxpaying chumps of the country, there are also too many tax evaders in the country, be they corporations big or small, your friendly neighborhood secretary, or black conservative underground restaurant owning tax evaders.

And while Detroit is a cesspool (and I hope when it finally gets to the sucking sound around the drain, it takes a bunch of unions, union-types, criminal elements, and commies with it), it will be deemed too big to fail and the temporary fix will AGAIN come out of our pockets.


12 posted on 07/23/2013 8:46:31 AM PDT by viaveritasvita ("The One who reigns forever, He is a friend of mine, the G-d of angel armies, is always by my side.")
[ Post Reply | Private Reply | To 10 | View Replies]

To: viaveritasvita
it will be deemed too big to fail and the temporary fix will AGAIN come out of our pockets.

Only because conservatives lack the courage and vision to come up with solutions of our own. Democrats know us far too well to simply let our inaction go unnoticed.
13 posted on 07/23/2013 8:51:37 AM PDT by cripplecreek (REMEMBER THE RIVER RAISIN!)
[ Post Reply | Private Reply | To 12 | View Replies]

To: viaveritasvita

Bulldoze it!


14 posted on 07/23/2013 8:56:38 AM PDT by Yosemitest (It's Simple ! Fight, ... or Die !)
[ Post Reply | Private Reply | To 12 | View Replies]

To: SeekAndFind
Detroit should not be bailed out but its the least of our problems.

Of course Detroit should not be bailed out . . . but . . . what problems?

There’s no problem. People (politicians, welfare recipients, rich people, students on scholarship) spend money they don’t have, they make promises thay know can’t be kept, they put off consequences until the consequences can no longer be put off, then reality comes knocking.

Sure . . . it’s brutal. It’s tragic. A lot of people get hurt. Public health declines, suicides increase, crime becomes worse . . . but . . . no problem.

Folly finds its own solution.

What did everyone think would happen?

15 posted on 07/23/2013 8:57:20 AM PDT by YHAOS
[ Post Reply | Private Reply | To 1 | View Replies]

To: SeekAndFind

I’m an NYPD cop. I sure hope my pension is there when I am eligible for retirement. Luckily I’ll be young enough to begin a whole new career if need be.


16 posted on 07/23/2013 8:59:33 AM PDT by thefactor (yes, as a matter of fact, i DID only read the excerpt)
[ Post Reply | Private Reply | To 1 | View Replies]

To: YHAOS
What did everyone think would happen?

Looking at the answers in this thread I'd say a lot of people think growing debt will never become a problem as long as there are taxpayers to milk.

The taxes in Detroit were jacked up to pay down debt and they just ended up with even less taxpayers. Anyone who thinks any other city in America is immune to the same economic reality is a moron.

Chicago is $97 billion in debt and just got a credit downgrade which will make the debt grow even faster. The city will inevitably seek to increase revenues and people will flee.
17 posted on 07/23/2013 9:06:32 AM PDT by cripplecreek (REMEMBER THE RIVER RAISIN!)
[ Post Reply | Private Reply | To 15 | View Replies]

To: katana

The difference between Detroit and NYC?

NYC has the financial industry to paper over with illusion and BS the insanity of the city failure.

Detroit only has vacant manufacturing buildings in rubble and social leaches who will beg the Feds to feed them.

Show me a city run by ComDems that is not a total failure. There is not one.


18 posted on 07/23/2013 9:07:31 AM PDT by Texas Fossil
[ Post Reply | Private Reply | To 4 | View Replies]

To: cripplecreek
"The city will inevitably seek to increase revenues and people will flee."

As I said . . . No problem. Folly finds its own solution.

19 posted on 07/23/2013 9:13:28 AM PDT by YHAOS
[ Post Reply | Private Reply | To 17 | View Replies]

To: YHAOS

Unfortunately people running away just go somewhere else and start the process all over. After all, the democrats of Detroit came to what was once a republican city.


20 posted on 07/23/2013 9:20:29 AM PDT by cripplecreek (REMEMBER THE RIVER RAISIN!)
[ Post Reply | Private Reply | To 19 | View Replies]

To: cripplecreek
"Unfortunately people running away just go somewhere else and start the process all over."

Yep. The solution follows the folly.

21 posted on 07/23/2013 9:29:56 AM PDT by YHAOS
[ Post Reply | Private Reply | To 20 | View Replies]

To: cripplecreek
Unfortunately people running away just go somewhere else and start the process all over.


22 posted on 07/23/2013 9:43:53 AM PDT by Bubba_Leroy (The Obamanation Continues)
[ Post Reply | Private Reply | To 20 | View Replies]

To: thefactor; YHAOS; cripplecreek; Texas Fossil

23 posted on 07/23/2013 9:45:48 AM PDT by SeekAndFind
[ Post Reply | Private Reply | To 16 | View Replies]

To: cripplecreek

>>Only because conservatives lack the courage and vision to come up with solutions of our own.<<

Conservatives?? REPUBLICANS lack courage and vision!

The communists have successfully destroyed Detroit, et al.

You know, I seem to recall all this cheerleading about investors coming in an salvaging Detroit around the time the RenCen was being built...am I wrong? How did that work out?

Maddening, sickening, disgusting, and utterly sad.


24 posted on 07/23/2013 9:46:18 AM PDT by viaveritasvita ("The One who reigns forever, He is a friend of mine, the G-d of angel armies, is always by my side.")
[ Post Reply | Private Reply | To 13 | View Replies]

To: SeekAndFind

LOL Detroit is going to go bankrupt in 2023?


25 posted on 07/23/2013 9:46:55 AM PDT by cripplecreek (REMEMBER THE RIVER RAISIN!)
[ Post Reply | Private Reply | To 23 | View Replies]

To: Yosemitest

>>Bulldoze it!<<

How about we fence it off and make some sort of museum out of it — The Detroit Institute of What Communism Looks Like.


26 posted on 07/23/2013 9:50:07 AM PDT by viaveritasvita ("The One who reigns forever, He is a friend of mine, the G-d of angel armies, is always by my side.")
[ Post Reply | Private Reply | To 14 | View Replies]

To: cripplecreek

>>Unfortunately people running away just go somewhere else and start the process all over.<<

I do believe the welcome wagon has a couple of broken wheels and no volunteer drivers to welcome them in my neck of the woods. Our city limits sign should read: “We’re full up, so sorry, turn around and go back. No Trespassing. Get lost. Your commie ideas are not welcome here.”


27 posted on 07/23/2013 9:54:15 AM PDT by viaveritasvita ("The One who reigns forever, He is a friend of mine, the G-d of angel armies, is always by my side.")
[ Post Reply | Private Reply | To 20 | View Replies]

To: viaveritasvita
Nope! You can take pictures of it, and then BULLDOZE IT!
Anything LIBERAL or DEMOCRAT ... needs to be TOTALLY DESTROYED !!!
28 posted on 07/23/2013 9:55:19 AM PDT by Yosemitest (It's Simple ! Fight, ... or Die !)
[ Post Reply | Private Reply | To 26 | View Replies]

To: SeekAndFind
Thanks for the BEEP!

I think I've already shot my wad on this subject, but thanks anyway.

29 posted on 07/23/2013 9:56:21 AM PDT by YHAOS
[ Post Reply | Private Reply | To 23 | View Replies]

To: SeekAndFind

Thanks for the table. That one is credible. Interesting to see how bad NYC is, the harbors and banking were always the anchor that maintained them. The solvency horizon for NYC is further out.

Now banking is Global and much of it is easily transferred to other physical locations. The harbor is still important.

BUT, the table shows Detroit’s solvency horizon as 2023 also??


30 posted on 07/23/2013 9:57:43 AM PDT by Texas Fossil
[ Post Reply | Private Reply | To 23 | View Replies]

To: viaveritasvita
You know, I seem to recall all this cheerleading about investors coming in an salvaging Detroit around the time the RenCen was being built...am I wrong? How did that work out?

If republicans behaved then the way they do now its understandable. I see nothing but defeatism outside Michigan just like it was a week before the right to work fight. A week before all you would hear at FR is that Michigan is a lost cause and will be union forever.


31 posted on 07/23/2013 10:06:50 AM PDT by cripplecreek (REMEMBER THE RIVER RAISIN!)
[ Post Reply | Private Reply | To 24 | View Replies]

To: Texas Fossil

The funny thing is that falling state taxes are bringing banking to Detroit. The city taxes are high for now but the state taxes have fallen enough for them to justify the move. JP Morgan has opened a regional HQ in Detroit, Quicken loans has transferred some 2000 people to their Detroit HQ, Ernst & Young has their building downtown. There’s also Compuware.

The big guys actually do just fine in Detroit because they can afford it. Its the little guys who can’t afford the high taxes, multiple layers of regulation, and army of inspectors they have to pay.


32 posted on 07/23/2013 10:16:45 AM PDT by cripplecreek (REMEMBER THE RIVER RAISIN!)
[ Post Reply | Private Reply | To 30 | View Replies]

To: Yosemitest

Communism needs to be totally destroyed. But it will take an act of G-d to do it. We (those of us informed enough to know who the enemy is and who are not afraid to name them) have tried before and it hasn’t worked. One could go all the way back to the Israelites who didn’t listen when G-d told them to “totally destroy” (the enemies of G-d, of which communism is a more modern version of) to see how it works: Weeelll, what do you mean by “totally destroy?” Can’t we keep some of the livestock? How about the strong young men and the lovely young women? Why can’t we rebuild the place?!

Never. Gonna. Happen.

A living museum: Charge the folks who want to gawk. Drive them around in model T replicas. Feed them at underground restaurants. “Look Gladys, over there! There’s one of those poor fools who didn’t get out while they could.” “Yep, yep, I see ‘im Chester. I think I saw one of them brown paper bag t-shirts in the souvenir store!”


33 posted on 07/23/2013 10:19:46 AM PDT by viaveritasvita ("The One who reigns forever, He is a friend of mine, the G-d of angel armies, is always by my side.")
[ Post Reply | Private Reply | To 28 | View Replies]

To: viaveritasvita
A living museum?
Will this idiot be there in a cage, so we can sell tickets?

Detroit's Model Citizens Line Up for Money from Obama's "Stash"
34 posted on 07/23/2013 10:32:42 AM PDT by Yosemitest (It's Simple ! Fight, ... or Die !)
[ Post Reply | Private Reply | To 33 | View Replies]

To: cripplecreek

Insanity

No other word explains the mess.


35 posted on 07/23/2013 10:33:48 AM PDT by Texas Fossil
[ Post Reply | Private Reply | To 32 | View Replies]

To: SeekAndFind

What do nearly all of those cities have in common? Hmmm, let me think. It starts with a “D” and ends with “emocrat Control.”


36 posted on 07/23/2013 10:36:25 AM PDT by Bubba_Leroy (The Obamanation Continues)
[ Post Reply | Private Reply | To 23 | View Replies]

To: Texas Fossil
BUT, the table shows Detroit’s solvency horizon as 2023 also??

The table just shows solvency horizons for municipal pension systems. In other words, if Detroit had no other debts or expenses and is unable to increase income to its pension system, in 2023 it would no longer be able to pay out pensions to everyone that has been promised them.

Since Detroit has a whole lot more debts and expenses besides its pension system, and tax revenue is not sufficient to even cover its debt service, Detroit is already bankrupt.

37 posted on 07/23/2013 10:41:10 AM PDT by Bubba_Leroy (The Obamanation Continues)
[ Post Reply | Private Reply | To 30 | View Replies]

To: cripplecreek

>>If republicans behaved then the way they do now its understandable. I see nothing but defeatism outside Michigan just like it was a week before the right to work fight. A week before all you would hear at FR is that Michigan is a lost cause and will be union forever.<<

I don’t quite understand your 1st sentence — would love to hear you expand upon it.

As to the rest, if we moved from talking about Detroit to talking about MI in general, I missed it (apologies, I should be doing the payroll instead of FReeping LOL).

I was totally behind Snyder re RTW, but I wasn’t holding my breath. I stood up and cheered when I heard the news. A stunning accomplishment, Michiganders, if you can keep it.

MI is (hopefully!) not a lost cause; Detroit is. The Detroit as we once knew it is gone. Whether it comes back for an temporary period of time, whether it downsizes and survives, whether it is bulldozed or turned into a museum...the Detroit we once knew is gone forever.

I will wait to see if/how the unions come up with ways to circumvent RTW. It remains to be seen just how long MI will be RTW (hopefully, forever). The ‘Rats are not going to give up their $$$$$ from workers easily, CC. What do you bet, the PTB in DC are right now as we speak scheming and planning behind the Soviet door on how to either circumvent or manipulate the new law to their advantage.

And, as much as I like the Republican Snyder, it doesn’t overrule my belief in:

Look at the new boss, same as the old boss.


38 posted on 07/23/2013 10:43:21 AM PDT by viaveritasvita ("The One who reigns forever, He is a friend of mine, the G-d of angel armies, is always by my side.")
[ Post Reply | Private Reply | To 31 | View Replies]

To: Bubba_Leroy
Detroit is already bankrupt

Yes, I already knew that. And the idiot judge ruled that the filing was wrong & embarrassing to Obozo. hee hee hee

39 posted on 07/23/2013 10:49:45 AM PDT by Texas Fossil
[ Post Reply | Private Reply | To 37 | View Replies]

To: Yosemitest

She’ll be part of an amusement ride...the model T will stop at a specific location and, for an additional fee, the gawkers can join in the fray. Kind of like the E-rides at Disney, we can call this one the EBT ride. For an additional additional fee, you can even don costumes such as hoodies...you’ll get a script with the appropriate Ebonics to use as you interact with the players. BHO stash can be handed out at the end of the ride as a consolation prize!


40 posted on 07/23/2013 10:57:03 AM PDT by viaveritasvita ("The One who reigns forever, He is a friend of mine, the G-d of angel armies, is always by my side.")
[ Post Reply | Private Reply | To 34 | View Replies]

To: SeekAndFind

If all the welfarism could be stopped in Detroit, the problems could be resolved. The people who have done so much to destroy Detroit would move on, and people who want to build businesses can move in, and fix it.


41 posted on 07/23/2013 10:58:42 AM PDT by pallis
[ Post Reply | Private Reply | To 1 | View Replies]

To: SeekAndFind
Why? Then-Treasury Secretary Bill Simon said default would be “awful.” Fed chief Arthur Burns heard from Europe’s leaders — and relayed to Ford — that bankruptcy was “unthinkable.”

The city got its bailout and repaid its debt (or refinanced it — we still owe $2.1 billion from that era).

That's from 37 years ago!

42 posted on 07/23/2013 2:27:09 PM PDT by neverdem (Register pressure cookers! /s)
[ Post Reply | Private Reply | To 1 | View Replies]

To: neverdem

43 posted on 07/23/2013 2:35:20 PM PDT by SeekAndFind
[ Post Reply | Private Reply | To 42 | View Replies]

To: pallis

If all the welfarism could be stopped in Detroit, the problems could be resolved. The people who have done so much to destroy Detroit would move on, and people who want to build businesses can move in, and fix it.

**

A loaded statement if there ever was one.

The problem is, in Detroit, as well as everywhere else, the people who destroyed it are NOT going to just “move on” They are here to stay and more are coming. They have needs — like food and shelter and health care ...and YOU and ME seem to always be on the hook for it.


44 posted on 07/24/2013 7:25:04 AM PDT by LibsRJerks
[ Post Reply | Private Reply | To 41 | View Replies]

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.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson