Detroit is a city providing a perfect example for liberalism with an agenda much like that of California. Struggling for years last week Detroit became the largest city in US history to file for bankruptcy.
With an unemployment rate twice the national average, running at 16-percent and city schools in which 7th graders are at 7-percent for proficient reading scores Detroit has failed the working class and its children.
It takes at least one-hour for police to answer a call and the enormous debt is anchored by $18 billion in unfunded liabilities. Voters have voted with their feet by leaving as the population has dropped by one-fourth.
Detroit was once a powerhouse for manufacturing where a middle-class lifestyle was not a dream but a reality. Assembly line manufacturing ran with near perfection building automobiles as well as tanks and airplanes to build an arsenal in which to defend American Democracy.
Post WWII automobile production boomed allowing many Americans to participate in the American dream. Motor City was also Motown churning out records albums and great singers and musicians, so many of their artists are still household names.
Competition is important in a pure Capitalist society. I like to say Capitalism makes the business world go round and round. This is the same for healthy government and in a Constitutional Republic we have more than simple Democracy, we have debate and more transparency than country’s where Democracy means rule by majority which many times translates into tyranny.
Detroit is dominated with a Democrat Party city council and has had a Democrat Mayor since 1962. One-party rule evolved into bad government that has featured Liberal policy making mirroring Blue State deals with union bosses. The bill has come due from the liberal agenda and it can’t be paid.
Instead of managing an overblown, unrealistic budget for decades the ruling class in Detroit refused to cut spending, practices poor fiscal management, borrowed when it was unaffordable, raised taxes, deferred public pension plan contributions and promoted state granting schemes.
Americans interested in learning can learn a great deal from Detroit. Our federal government is churning to a $17 trillion national debt. (See right sidebar.) These debt exceeds the US national economy. Nurturing ever unaffordable entitlement programs will eventually send the national government and economy to the breaking point. In essence, the United States will begin to reflect Detroit.
As a state with a Republican and fiscally sane Governor, Michigan has introduced right-to-work laws which will create competition and become a point of destination for business and employees.
Union bosses don’t want you to know a simple statistical fact – right-to-work states enjoy higher wage growth, and better compensation when you factor in cost of living for workers belonging to unions.
When you reduce public sector unions relief transfers to public-sector union pensions which have dragged down Detroit to bankruptcy.
Detroit’s demise didn’t happen overnight and it won’t be revitalized by more of the same toxic fiscal poison. Proper fiscal management from a bankruptcy court may be it’s only hope. A federal bailout is nonsense and should never occur.
A federal bailout will be on the backs of all US taxpayers. This would set a dangerous precedent in the future as Detroit isn’t the only city or state in fiscal trouble.
Liberals are demanding that Barack Obama bailout Detroit like he bailed out General Motors and Chrysler. How did that really work out.
In a 2012 Obama campaign video actor Tom Hanks narrates:
“Because of the tough choices the president made, the stage was set for a resurgent U.S. auto industry,” Hanks says in the 17-minute highlights reel of Obama’s presidency, titled The Road We’ve Traveled.
“With business booming, (GM and Chrysler) repaid their loans,” he later concludes.
Here’s the net tally from the auto bailouts:
“New” Chrysler has paid back all of the money it got from the U.S. government, and is free of any ties to Washington. But Uncle Sam is more than $2 billion in the hole on the old Chrysler, which is still being liquidated.
GM’s unpaid debt to Washington is about $26.4 billion, with that debt converted to an ownership stake in the company that’s only worth about $12.5 billion, at recent stock prices. So the government is still out about $14 billion on GM, and $16 billion on both companies. And that doesn’t include Ally Financial, the old GMAC, which used to be part-owned by GM and still owes the government another $12 billion or so.
Bankruptcy court NOT the American taxpayer is the road for Detroit. We owe nothing to a mismanaged city or state and it’s time they swallow the medicine of fiscal reality.