Free Republic

With the instructive Detroit precedent, shrunken populations, and underfunded municipal pensions common, we can conclude that no city, not even Chicago, should be thought of as too big to fail. About the bonds of Detroit, Barron’s said: “A lot of investors bought this debt because they assumed that the state of Michigan wouldn’t let its largest city default.”1 In other words, they assumed Detroit was “too big to fail.” Nonetheless, Detroit did default and became the largest municipal bankruptcy in history. This bankruptcy, with unfunded municipal employee pensions among the competing creditors, is a hugely important precedent. Is any city...

Just off of the James C. Lodge Freeway in Detroit is Eight Mile Road. The stretch near the freeway is just east of the famed area that provided the basis for the Eminem film of the same name. To its north lie predominantly white suburbs -- over 77 percent of those who live in Oakland County are white -- with median family income in excess of $65,000. Married couples comprise approximately half of households, with fewer than 15 percent of households led by a single female. Since 1990, the population of Oakland County has jumped from 1.083 million to...

Half a Billion Dollars. That’s how much the California Teachers Association and the powerful Service Employees International Union have spent on California politics since 2000. The unions’ return on that “investment”? A legislature totally beholden to them for political support and campaign contributions. Here’s another mind-boggling number: Half a Trillion Dollars. That’s an estimate of the unfunded public pension liabilities racked up by California’s state and municipal governments due to overly generous pay and defined benefit pension plans lavished on unionized government employees. If you thought the bankruptcies of Stockton, San Bernardino, and Vallejo were entertaining, break out the popcorn...

O.K. I'm reaching out for help from people that I can trust. I need somebody with knowledge in Bankruptcy/Chapter 13 going to Chapter 7 and Real Estate Laws. My Girlfriend has the Family house and they are trying to take it. Her ONLY vehicle is also involved. I can't drive anymore so I have no vehicle. So if they take the truck She can't get to work, Doctors, etc. The only notice received at this time has been an E-Mail (from Her "Lawyer" who from what I know is basically USELESS) within the last hour. No Process Server, No Certified/Registered...

As it sought to recruit well-heeled investors, an untested and unprofitable Miami company named InnoVida brought aboard a trusted Florida figure in 2007: Jeb Bush, the former governor and the brother of a sitting president. For potential stockholders, the imprimatur of Mr. Bush, who joined InnoVida as a paid consultant and a member of the board of directors, conferred credibility on the young start-up. That credibility did not last long. It turned out that the leaders of InnoVida, a manufacturer of inexpensive building materials, had faked documents, lied about the health of the business and misappropriated $40 million in company...

This month marks the fifth anniversary of the Chrysler bankruptcy. President Obama will doubtless mark the occasion by talking about how his intervention saved the auto company. More noteworthy, however, is how the lawlessness of that intervention created tremendous uncertainty, which still chills the economy today. Todd Zywicki has written an excellent summary of President Obama’s actions in the Chrysler bailout. A shorter version goes like this. Starting under President Bush and continuing under President Obama, the federal government used TARP funds to keep Chrysler afloat. This gave the government effective control over Chrysler. As a result, the Obama administration...

<p>The women’s clothing retailer failed to find a buyer or new capital. A liquidation sale is planned.</p> <p>Women’s specialty clothing chain Coldwater Creek filed for bankruptcy on Friday and said it will close all of its stores around the country, including 11 in Minnesota.</p>

Brookstone, the seller of all sorts of unusual electronic items through channels including mall stores in Massachusetts, is filing for bankruptcy protection and plans to sell itself to rival Spencer, the Wall Street Journal reports. Brookstone has Massachusetts locations in Boston, Holyoke, Peabody, Braintree, Marlborough, Wrentham, Burlington and Natick.

New Jersey’s largest city is hitting some roadblocks just months after its rising-star mayor went off to Washington. A bold reform plan for the state-run school system has hit a snag, the police department is facing federal oversight over citizen complaints, and the state is threatening a takeover of the city’s finances after several key deadlines were missed. An official who oversees city compliance with state obligations warned the City Council and the interim mayor last month about the state’s growing concern over Newark’s “extraordinary level of fiscal distress.” …

Honey Maid stirred controversy with a recent commercial that challenged traditional notions of what constituted a family. "This Is Wholesome" features a variety of families, including interracial couples and their mixed-race children, as well as a same-sex couple and their children. (See the commercial below.) As would be expected, Honey Maid generated a response. The company could have let it lie. Instead Honey Maid decided to make a new statement.

On March 10, Honey Maid - the graham cracker company - launched a commercial that celebrated all different kinds of families. The message was that no matter what, love is what makes a family a family... The title of the commercial was "Wholesome Love," but not everyone agreed with its message. A followup video was created by Honey Maid explaining the responses to the commercial...

I wish that this were just another bad April Fools' Day joke, but sadly, this story is all too real. Since President Barack Hussein Obama was inaugurated into office a little over five years ago, Obama, Pelosi, and Reid have doubled America's publicly held debt, an increase of more than 6.3 trillion dollars: Date                   Debt Held by the Public         Intragovernmental Holdings   Total Public Debt Outstanding 03/31/2014        6,307,310,739,681.66          4,319,566,309,231.42          10,626,877,048,913.08 8/19/2011          12,619,319,113,193.99 ...

As local government officials cheered the full reimbursement of revenue loss due to phasing out personal property taxes, others questioned whether local governments require a new state funding source. But local governments are not generally in need of extra funding: they are a unique example of (mostly) successful intergovernmental cooperation and a focus on giving residents more bang for the buck. Local governments were well protected from Michigan's general malaise during the 2000s. From 2001 to 2010 when the state's economy lost 700,000 jobs, there was a general rise in the housing market, which increased property tax collections by counties,...

For you movie buffs, this is a fascinating documentary called "Life After Pi" about the special effects company called Rhythm and Hues that did the incredible effects for "Life of Pi" and "Snow White and the Huntsman." They begin by blaming "foreign subsidies" (i.e., Canadian and British subsidies for outsourcing work, often to Vancouver) and feature Obama making one of his typical stupid appearances calling for "supporting" Hollywood. But then you lean that this company, which has been in business for over 20 years, was using a poor, unsustainable business model in that it would bid "fixed" price contracts on...

Quiznos has filed for bankruptcy protection, five days after the Sbarro pizza chain did the same. Executives at the restaurant chain, known for its toasted sandwiches, agreed to a restructuring plan that will reduce its debt by more than $400 million, the company said in a statement Friday. All but seven of Quizno's 2,100 restaurants in the United States and 30 other countries are independently owned franchises, and will remain open and operating as usual. Quiznos once had more than 5,000 stores and could have threatened rival Subway's hold on the sub market. But now, Subway has nearly 20 times...

Restaurant chains are dropping like flies this week. On Monday pizza franchise Sbarro dipped into Chapter 11 bankruptcy. Following in its footsteps on Friday, sub shop Quiznos announced that it too would sink into bankruptcy as part of a “pre-packaged” deal to cut its debt by more than $400 million, or two-thirds.

Sbarro has filed for Chapter 11 bankruptcy reorganization for the second time in just three years as the pizza chain struggles to turn its business around amid a drop in traffic at shopping mall food courts. The bankruptcy filing on Monday comes after the company shuttered 155 of its U.S. locations last month. The Melville, N.Y., company still has about 800 locations globally, half of those in North America. The pizza chain isn’t alone in hurting from the decline in traffic at shopping malls. Earlier this year, the owner of Hot Dot on a Stick also filed for bankruptcy protection,...

People apparently don't eat pizza when it is snowing... Or during an economic recovery... And certainly not when celebrating the market's all time high 5 year bull "market" anniversary. That is the conclusion one can derive from the just filed Sbarro Chapter 11 bankruptcy filing, which just happens to be the company's second in three years after it did the same in April 2011. The filing itself, which lists assets and liabilities between $100 and $500 million, is not surprising following on the heels of the announcement last month, when Sbarro said it would close 155 of 400 North...

Detroit's looming bankruptcy is making news again, this time focusing on current restructuring plans aimed to wipe out $18 billion in debt by axing pension checks of city retirees, including police and fire. Massive long-term retirement and healthcare promises were by no means solely responsible for the city's fall, but these massive pensions coupled with a tax base weakened by high unemployment and housing vacancies caused the budget to bleed out quicker. The Michigan city may be the most recent victim of bankruptcy, but many of the 61 largest U.S. cities have adopted the same retirement legacy leading to $118...

Sandwich chain Quiznos is preparing to file for bankruptcy protection within weeks as it contends with declining sales and a lofty debt load, people familiar with the matter said. The company, which has about $570 million in debt, has been negotiating with creditors for weeks on a restructuring plan that would streamline its trip through bankruptcy court, these people said. A final deal on a so-called prepackaged restructuring plan hasn't yet been reached, they said.