Detroit’s Deficit Spending Problem And The Orr Report ($100 Million Deficit)

Confounded Interest ^ | 05/13/2013 | Anthony B. Sanders

[whitedog57]

Since 2008, Detroit’s spending exceeded its budget by about $100 million annually. Detroit also borrowed $80 million last March to avoid running out of money. Clearly, Detroit has a deficit spending problem … much like the US Government.

Here is the city’s emergency manager, Kevyn Orr’s, Orr Report. city-of-detroit-final-financial-operational-plan-45-day-plan5

Orr’s solution? Cut back on pay and restructure the debt (a coy way of say default).

“Without a significant restructuring of its debt, the city will be unable to break the cycle of damaging cutbacks in essential municipal services and investments,” according to Orr’s report. He also cited the need for concessions from unions, and revamping the police and fire departments to protect residents beset by crime and arson-inviting blight.

Detroit’s long-term obligations are at least $15.7 billion, including unfunded pension and retirement benefits. The general fund this fiscal year, with revenue of about $1.1 billion, will pay about $461 million for debt and health costs, according to the report.

Detroit has suffered from a declining population, job loss and falling house prices. Until recently. e

Foreclosures have been a major problem, particularly since they are clustered.

And crime remains a problem, which is a challenge to the government and Mr. Orr.

I wish Dave Bing (one of my childhood basketball heroes) and Mr Orr all the best. Particularly when they try to cut union wages.

I wonder if Robocop is in the police union?

[whitedog57]

What a mess! Watch Obama bail them out.

[catnipman]

I don’t know why existing Detroit muni bonds haven’t been discounted to paying 99% effective interest rate.

[Wurlitzer]

A preview of what we can expect at the city/state and eventually the Federal level when forced to live under democrat/liberal/progressive/minority rule.

Inferior people will never learn the lessons of history which show big all powerful governments have always destroyed their countries.

There are differences and all are not equal.

[esoxmagnum]

pfffft, amateurs

come to Illinois and Chicago to really learn how to spend beyond your means!