Record Bankruptcy for Detroit

Wall Street Journal ^ | July 18, 2013 | Mathew Dolan

[lbryce]

DETROIT—The city of Detroit filed for federal bankruptcy protection Thursday after decades of decline, a new low for a city that once defined industrial America's might but was hollowed out by the flight of residents and businesses to the suburbs.

The filing by the automobile capital and onetime music powerhouse—which has liabilities of more than $18 billion—is the country's largest-ever municipal bankruptcy case.

The move to restructure the debt is bound to set off months, if not years, of legal wrangling, asset sales and cuts to benefits for Detroit workers and retirees, including 20,000 on city pensions. Owners of the city's bonds are expected to battle with retirees and others for pieces of the city's diminished wealth

[Go Gordon]

From the article: "I was planning on retiring in October, but now I'm not sure. I have a lot of questions," said Herbert Jenkins, 50, who has spent the last quarter century working for the city and repairing its potholes. It's such a sad day for Detroit."

When pothole repairmen only have to work 25 years, and can retire at age 50 (meaning he will probably collect a pension for more years than he actually worked) is it any wonder the city is broke?

[2001convSVT]

The critical point in the Detroit bankruptcy is how the Bond Holders are treated. Unless the bonded investments are a guarantee of repayment, Bonds of all municipalities(and state, and federal) are in jeopardy. Easy money to local government will evaporate, and we will see a large increase in the interest rates of those willing to buy bonds, to cover the risk of default. How the courts treat Bond holders will be critical in whether Detroit is the first of many to default or only a local tragedy.

[taildragger]

This city will never recover.

Ya need to talk to "cripplecreek" who IMHO is wired to what is going on behind the scenes. It seems big and smart money is about to buy in low. He will give you the 411 on the Iron Ore and Tar Sands coming to the City via ships, how they will be powered by LPG, Trade and Manufacturing in Canada and a potential Manufacturing back in Detroit with resurgence of a healthy Detroit and how it may become a trading hot spot....

[Caipirabob]

Will the Indians take it back?!?

[grania]

Why not give it to Canada?

How do they do that without residents of Detroit becoming citizens of Canada, free to roam their country at will? I assume you're being sarcastic, but selling them the lakeside and the other side of the bridges connecting with Canada, population (what's left of it) moved elsewhere in Detroit would have benefits.

Another idea that comes up every now in then is breaking up these large, dysfunctional cities. Instead, politicians keep coming up with schemes to integrate smaller towns with each other or folded into adjacent cities. Smaller governments work best, as long as they're not starved by all state and federal money going to propping up unsuccessful cities.

Often times, a good idea is just something that starts out silly being twisted and turned a bit. Problem is, no one in charge is dealing with problem-solving anymore.....except for propping up the puppet masters. JMHO

[csmusaret]

Why did Detroit go bankrupt? Look for the Union Label.

http://www.time.com/time/photogallery/0,29307,1882089,00.html

[grania]

My favorite quip is that at one point MI and OH fought for Toledo....and OH lost.

[Moltke]

detroit is french for “to the right”

No it isn't.

[cripplecreek]

No 411 here. I'm just a conservative who pays attention. There's a degree of economic and individual freedom in Detroit that you won't find in other large cities in America. Meanwhile on the east and west coast companies are being slowly strangled by excessive taxation and regulation. JP Morgan just opened a regional HQ in Detroit. Quicken loans is importing people from other cities. During the Detroit Grand Prix, Firestone announced that they would be opening an R&D facility in Detroit.

Even at its worst, Detroit is still the second busiest freight crossing on the continent but its been bottlenecked by a single aging bridge. I think the approval for the new bridge has been one of the biggest factors bringing investment to the city.

When it comes right down to it, people need to stop giving Detroit the global warming treatment built on consensus opinions and start thinking for themselves realistically. Detroit isn't going anywhere and that's a simple fact. We can sit back and pout as the democrats pointlessly dump taxpayer money into the city while claiming credit or we can be traditional conservative builders and start taking back what is rightfully ours. Personally I think the current sit and pout attitude of conservatives is a sure fire loser.

The only true fix for Detroit and the other coming collapses of other larger cities are Family, Faith, and Free markets.

The major issue of this campaign is the direct political, personal and moral responsibility of Democratic Party leadership--in the White House and in Congress--for this unprecedented calamity which has befallen us. They tell us they have done the most that humanly could be done. They say that the United States has had its day in the sun; that our nation has passed its zenith. They expect you to tell your children that the American people no longer have the will to cope with their problems; that the future will be one of sacrifice and few opportunities.

My fellow citizens, I utterly reject that view. The American people, the most generous on earth, who created the highest standard of living, are not going to accept the notion that we can only make a better world for others by moving backwards ourselves. Those who believe we can have no business leading the nation.

I will not stand by and watch this great country destroy itself under mediocre leadership that drifts from one crisis to the next, eroding our national will and purpose. We have come together here because the American people deserve better from those to whom they entrust our nation's highest offices, and we stand united in our resolve to do something about it.

Ronald Reagan Nomination Acceptance Speech Republican National Convention Detroit, Michigan July 17, 1980

[A Formerly Proud Canadian]

Hey, what have we ever done to you?

Keep it!

[bgill]

Never fear, the usurper will write them a check with the rest of the country’s tax dollars.

[i_robot73]

I heard that ~40% of the street lights don’t work in Detroit. I wonder what the % of unfilled potholes turns out to be....Then I’ll come back to his guy and his ‘problems’.

I’m sure, too, he wasn’t crying when the City was upping the Union $$, so the unions could funnel some if it back (no doubt), while the taxpayer had NO say in the matter.

[Nervous Tick]

Spot on, FRiend.

[Nervous Tick]

>> what is french for “to the wrong”?

John Kerry?

[headstamp 2]

Make way for Delta City.

[TArcher]

[Socialism crept in and has done what it always does. Made it destitute.

Soon this will come to States and then to America completely.]

Yep.

Got McFeudalism?

[apoliticalone]

In hindsight the root cause of many of our nation’s problems are greedy bxstards who own our corrupt politicians and crave cheap labor above the interests of the country.

It goes back to and before the plantation owners, farmers, and now the global Chamber of Commerce that wants cheap labor and so they imported both our problems, and exported our jobs. We can include politics, and that is a major factor contributing factor because of corruption, but in the end its about failure of citizens and elected officials to put country first.

[apoliticalone]

“I will not stand by and watch this great country destroy itself under mediocre leadership that drifts from one crisis to the next, eroding our national will and purpose. We have come together here because the American people deserve better from those to whom they entrust our nation’s highest offices, and we stand united in our resolve to do something about it.”

Was that speech before or after amnesty #1? That worked out real well in changing the face of America into a booming vibrant country didn’t it? More like changing us into a third world country of teeming corrupt gang infested cities.

We need to see less golden oratory and rhetoric and more real policies that actually benefit the sovereign USA citizens, and not the globalists.

[TArcher]

The critical point in the Detroit bankruptcy is how the Bond Holders are treated. Unless the bonded investments are a guarantee of repayment, Bonds of all municipalities(and state, and federal) are in jeopardy

 

Observe this never occupied commercial property.    Completed in 2007, last time I drove past it was still McEmpty.

 

 

Ever wonder who the suckers are whose Bonds and Retirement Funds and "Institutional Investments" are on the hook for paying the taxes on such securitized "investments"?

[cripplecreek]

Reagan was right, we need builders and today’s conservatives aren’t going to accomplish anything but bitching and moaning.

As far as amnesty is concerned, Save it for a thread about the subject