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Detroit: bankrupt

Today, Detroit became the largest American city to file for bankruptcy, a rare occurence. Despite attempts to fix the city’s finances and some success in attracting new businesses, a declining industrial base, high crime in some areas, fixed expenses, and allegedly rampant corruption have all brought large deficits. The move was made by the city’s emergency manager, Kevin Orr, appointed by Governor Rick Snyder, to deal with $2.5 billion in unsecured debt and a deficit estimated at $380 million; Orr claimed that total long term debt was likely over $17 billion.
 

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Not good but it was probably inevitable.................
 

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DO NOT FEED THE TROLLS!
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I wonder how bankruptcy will affect the power of elected officials in the city, especially in light of corruption allegations and past proven corruption. If the bankruptcy court appoints a manager and essentially gives that manager all power, then it could be that the elected officials may no longer have much more than just a meaningless title, at least until bankruptcy is discharged. If corruption at elected levels then sidelining those officials may actually help.

Working for a large bureaucracy, I can say that it's difficult to affect change if those in middle-management don't themselves embrace making those changes called for from the top. If those in the middle do not enforce policies of those at the top, then the those at the bottom won't see or make any changes.
 

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TWX said:
I wonder how bankruptcy will affect the power of elected officials in the city, especially in light of corruption allegations and past proven corruption. If the bankruptcy court appoints a manager and essentially gives that manager all power, then it could be that the elected officials may no longer have much more than just a meaningless title, at least until bankruptcy is discharged. If corruption at elected levels then sidelining those officials may actually help.

Working for a large bureaucracy, I can say that it's difficult to affect change if those in middle-management don't themselves embrace making those changes called for from the top. If those in the middle do not enforce policies of those at the top, then the those at the bottom won't see or make any changes.
I think they already cut a lot of the power from the elected officials when emergency finanical manager was appointed back in May or so.
 

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I lived in Livonia (west of Detroit) for a couple of years while attending MoTech and working part-time at a metal plating factory in the '70's. The car industry (i.e.-economy) was down then and assembly quality reflected that. I will always have a kinship with the people there. It is my second-home. It was a big part of my life and sometimes I get homesick for Detroit. It is about a 7 hour drive from here.
Lee Iacocca sparked a new hope in 1980 that was contagious. The city has a lot to offer and a lot to see.
The administration in Detroit lately has saddened me and the anger of the residents have changed the mood of the area. The city is a blend of cultures and there are good people everywhere.There are safe areas, but crime is rampant in other areas like any other big city. You don't have to live in fear and always be looking over your shoulder.
Kwame Kilpatrick was a player and a symptom of the bigger problem of the corrupt Detroit government. http://en.wikipedia.org/wiki/Kwame_Kilpatrick
When we had the Allpar meet in Auburn Hills a couple of years ago, I was able the visit Alma Mater and my old landlady. We shared a lot about the good times and the current state of affairs. It is sad when it gets blamed on race, because we all work alongside eachother and depend on eachother. The finger-pointing over the collapse of Detroit is a symptom of a bigger problem. My state taxes keep the Big Apple going. Rome fell too.
Detroit has always been a roller-coaster economy depending on car sales in good times and bad. It is a resilient city, but people can only take so much. The suburbs have sprawled and are facing similar financial/social problems now.
It will always be the Motor City to me. http://detroit2020.com/2011/01/11/believe-in-detroit-campaign/
 

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Discussion Starter #8
IC, I wonder how much it's true that the state supports NYC, more than NYC supports the state -- the incredible wealth of the NYC elites added to the considerable wealth of the non-elites add up to a lot of income tax. Not to mention all the New Jerseyans and Connecticutians who pay taxes to NY State because they're working in NYC. Even if you work one day in NYC, you owe tax to the state...

Anyway, with Detroit, corruption was almost certainly a real and major problem, but the basic cause was not getting disciplined long ago. It's hard, though, where do you cut back? Most cuts backfire... when NYC started cleaning the subway trains, crime went down...

With that level of debt, bankruptcy may have been inevitable, but it certainly wasn't inevitable 20 years ago. More state assistance rather than state enthusiasm for bankruptcy might have helped, too. Gov Snyder's obvious glee at this turn of events was inappropriate ... I think he's seeing bankruptcy as a triumph over the unions, and I'm seeing a lot of firemen and cops losing their homes, as well as jacked-up loan and bond rates for every other city in America.

Y'know when NYC was on the verge of bankruptcy, the unions quietly invested $150 million in pension funds into the city while they started convincing President Ford to make some temporary loans. THey needed to slash their budget and stop the more blatant corruption but that happened. Eventually they reprofessionalized the police and got back onto a solid footing.
 

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CJDsalespro said:



I am pretty sure....this advertising campaign is dead........
Y?
 

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The city government of Detroit just needs to dissolve itself into oblivion and have Wayne county pickup the emergency services. There is no sense in letting a failed city continue as a level of government. They are $14 billion in the hole, and there is no hope to repay that ever.
 

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Well, anything is possible, it just has to be done properly. It will take a couple decades to make it happen, but no way is it going to happen if they don't get some jobs and businesses to return to the city.
 

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ImperialCrown said:
I lived in Livonia (west of Detroit) for a couple of years while attending MoTech and working part-time at a metal plating factory in the '70's. The car industry (i.e.-economy) was down then and assembly quality reflected that. I will always have a kinship with the people there. It is my second-home. It was a big part of my life and sometimes I get homesick for Detroit. It is about a 7 hour drive from here.
Lee Iacocca sparked a new hope in 1980 that was contagious. The city has a lot to offer and a lot to see.
The administration in Detroit lately has saddened me and the anger of the residents have changed the mood of the area. The city is a blend of cultures and there are good people everywhere.There are safe areas, but crime is rampant in other areas like any other big city. You don't have to live in fear and always be looking over your shoulder.
Kwame Kilpatrick was a player and a symptom of the bigger problem of the corrupt Detroit government. http://en.wikipedia.org/wiki/Kwame_Kilpatrick
When we had the Allpar meet in Auburn Hills a couple of years ago, I was able the visit Alma Mater and my old landlady. We shared a lot about the good times and the current state of affairs. It is sad when it gets blamed on race, because we all work alongside eachother and depend on eachother. The finger-pointing over the collapse of Detroit is a symptom of a bigger problem. My state taxes keep the Big Apple going. Rome fell too.
Detroit has always been a roller-coaster economy depending on car sales in good times and bad. It is a resilient city, but people can only take so much. The suburbs have sprawled and are facing similar financial/social problems now.
It will always be the Motor City to me. http://detroit2020.com/2011/01/11/believe-in-detroit-campaign/
I think Detroit's problems are no longer about race as they are economic freedom. Unfortuantely the sad reality for many people in Detroit, they are only there because they cannot afford to leave. I do agree with you however, that there has been a great divide perpetuated between Detroit politiicans and the rest of the state. Oakland and Macomb counties to the north of Detroit did not embrace Detroit as the anchor that helped their counties explode in growth, and Detroit leadership for many years portrayed suburbanites as the reason why the city is in decline. I think that Michigan's Emergency Financial Law have further expanded the canyon between Michigan's major cities and the rest of the state. Right now there is zero trust of state governrment within Detroit, and it is likely to cause this thing to drag on in courts for many years keeping Detroit in a negative light.
dana44 said:
Well, anything is possible, it just has to be done properly. It will take a couple decades to make it happen, but no way is it going to happen if they don't get some jobs and businesses to return to the city.
You hit the nail right on the head. The debt could be zero, but if there is not revenue to sustain the city, it will be back in bankruptcy court in five years. There is so much obsession with balancing books, but there is ZERO effort to get out there and recruit manufacturers to the city. There has been a lot of activity downtown, but what about the rest of the city? Face it, people will not aspire to live in Detroit's neighborhoods for decades- unfortuantely it is a damaged brand. However, if there are jobs there, people will travel from afar to work there.
 

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dak4x4 said:
Drastic locations take drastic measures. I was in Iraq and was privy to how the "surge" was constructed and implemented. If that can be done, this should actually be easier because you don't have to travel to foreign countries and search for people to return. Yes, there is a lot of bad, mismanaged, neglected, pilfered stuff going on in the area, but that doesn't mean it can't be fixed. If that were the case, nuke it and keep everyone out. It still goes without saying, if business is not incentivized to return then no, it won't be saved. It is no different than a rusted hulk in a field. One has to start somewhere when restoring anything, and it takes a lot of work to make it happen. You improve what happens in the future and you fix what was done in the past.
 
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dana44 said:
Drastic locations take drastic measures. I was in Iraq and was privy to how the "surge" was constructed and implemented. If that can be done, this should actually be easier because you don't have to travel to foreign countries and search for people to return. Yes, there is a lot of bad, mismanaged, neglected, pilfered stuff going on in the area, but that doesn't mean it can't be fixed. If that were the case, nuke it and keep everyone out. It still goes without saying, if business is not incentivized to return then no, it won't be saved. It is no different than a rusted hulk in a field. One has to start somewhere when restoring anything, and it takes a lot of work to make it happen. You improve what happens in the future and you fix what was done in the past.
Absolutely it will take a lot of work and dedicated people...at local, state and federal levels. Bulldozing the supposed 80K+ abandoned buildings is a start.
 

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burnout said:
Absolutely it will take a lot of work and dedicated people...at local, state and federal levels. Bulldozing the supposed 80K+ abandoned buildings is a start.
And who is going to pay for that? Not enough market for the salvaged materials to break even.
 

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Discussion Starter #20
There was a program under way before the Emergency Manager to bulldoze the abandoned buildings and create "urban farms." It was doing pretty well from what I hear.

There was a lot going on, what Detroit should have had was some help from the FBI or state police (rooting out the criminals and corruption), and more help from major companies (though they did get a lot of this from CompuWare, and let's not forget the donations of money and vehicles from Penske and the Big Three).

Turning around cities takes a LONG time. Like I said, there was a time when nobody thought Newark would ever come back -- indeed, I could tell you it looked that way in 1990! but now the city’s much, much better. Hoboken was given up for dead in the 1970s. Jersey City was thought unrecoverable.

I wonder if Camden will go this route?

It's interesting to me how cold-hearted so many people are. All those former cops and firemen, including people whose health was destroyed by their bravery (or just doin’ their job), who are unable to work or fully take care of themselves — well, they’re just sucking at the public teat, right? Union cowards.

The bankruptcy itself... having the governor call an emergency "let's try to work it out meeting" to delay a court filing just long enough to file Chapter 9 papers... shows something of his character.

In the end, Gerald Ford lent a hand to New York City and prevented its bankruptcy once NYC could show a plan for moving ahead. I guess times are different now and maybe federal aid isn't possible, certainly Congress isn't going to do something just because the President wants to, but it just seems like Snyder was pushing for bankruptcy from Day One. I'm willing to believe Orr was trying to get the city working without it.

If Detroit is successful, watch every other troubled city in the country follow. Then wonder why nobody wants to be a cop or fireman.
 
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