>> Fitch Ratings lowered Chicago’s debt to A- from AA- last week, making it the second serious downgrade since July.
That’s a FACT. Are you capable of addressing it?
>> The move by Fitch follows a triple downgrade of Chicago’s bond rating by Moody’s Investors in mid-July.
That’s a FACT. you capable of addressing it?
Moody’s cited the city’s “very large and growing” pension liabilities and “significant” debt service payments, among other factors.
That’s a FACT. you capable of addressing it?
>> Democratic governance is a common thread running through America’s urban problems.
That’s a FACT. you capable of addressing it?
>> Chicago’s outstanding debt on general obligation bonds has quadrupled during the past 18 years, reaching $7.2 billion last year.
That’s a FACT. you capable of addressing it?
>> With interest, that amount nearly doubles. The city has more general obligation debt per capita than any of the 10 largest U.S. cities except New York.
That’s a FACT. you capable of addressing it?
More facts:
“Pete Saunders, an urban planner who grew up in Detroit and now lives in Chicago, offers evidence that outcome is unlikely (excerpt):
Writing in Crain’s Chicago Business this week, he lays out three main elements that will allow Chicago to escape Detroit’s fate:
1) Chicago is way bigger:
A report from the federal Bureau of Economic Analysis released in February shows that Chicago metro area GDP in 2011 was $548 billion annually, making it the third largest in the nation after New York and Los Angeles. That makes the Chicago economy nearly three times larger than Detroit’s, which checks in at $199 billion. Chicago’s economy is also more diverse than Detroit’s, with no one industry sector making up more than 13 percent of the metro area workforce.
2) Chicago’s fiscal structure is less concentrated than Detroit’s:
the dozens of municipal corporations and special-purpose districts here, lacking in Detroit, meant the fiscal burden could be spread around. As a result, City Hall ends up having fewer direct responsibilities and a slightly rosier fiscal picture.
3) The two cities have fundamentally different characters in a way no one really talks about:
There was a certain disposableness built into Detroit — cheaply built homes and low-quality business districts dominate much of the city. Disposability long ago sent a message to Detroiters: As you move up, you move out. Chicago, meanwhile, was built with a sense of permanence. Chicago has a physical character that tells its residents that it is worth having, worth saving.
In sum: Chicago has problems, but Detroit remains a unique mess.
http://www.businessinsider.com/chicago-is-not-the-next-detroit-2013";
Analysis: Why we’re not the next Detroit
Excerpt from Chicago Sun Times, July 20, 2013 1:36AM:
“Is Chicago headed down the same road as Detroit?
It’s not the size of the debt, but the ability to pay it. Experts in government finance said Chicago is far better situated than Detroit. Compared with the Motor City, Chicago hasn’t suffered the population loss, it’s drawn more new employers from corporate headquarters to technology startups, its tax base is stable and it doesn’t have nearly the level of tax delinquency.
Donald Haider, a former Chicago budget director and a management professor at Northwestern University, recalled scouting Detroit for a bank acquisition years ago. “After the riots of the 1960s, there wasn’t a residential building permit issued in Detroit for 20 years,” Haider said.
Chicago has broken-down neighborhoods, but in Detroit, urban decline “was chronic and systematic and progressively downhill. We have nothing quite like that,” he said.
The differences between Chicago and Detroit emerge in three key areas that bond analysts look at:
Economic strength: The Chicago area’s economy is almost three times the size of the Detroit region’s, where the unemployment rate is nearly twice as high. “Our economy is diverse, which is our strength,” Emanuel said, “We’re not tied to the auto industry. No one sector is more than 13 percent of our employment.”
Elizabeth Foos, municipal credit analyst at Morningstar Inc., said Chicago is seeing a job rebound in areas such as banking, financial services, transportation and health care.
By some gauges, Detroit barely functions. Foos said 40 percent of the city’s streetlights don’t work and more than half of property owners didn’t pay taxes owed in 2011.
Debt levels: Chicago’s property and sales tax revenues are improving with the economy and the city’s debt load is manageable. Foos has published reports on both cities indicating that if their debts are compared to the taxable value of their property, Detroit’s burden is more than twice that of Chicago.
Population: Detroit has lost 60 percent of its population since its 1950s peak. For the first decade of the 21st century, Detroit was down 25 percent. For the same time periods, Chicago lost 25 percent and 7 percent of its population.”
There are more facts than this, but it should suffice to anyone other than those who wish to remain intentionally uninformed.
No, she isn't.
I live in Wisconsin, but my job is based in Chicago, so I travel there (downtown) a lot. Chicago is dead, but the corpse doesn't quite know it yet. Crime is running wild but they are doing a pretty good job of keeping it hushed up, i.e. ignored. The inability of democrat-run cities and states to live within their means is well documented and on display here. flaglady thinks it can't collapse financially, but that's her heart talking and not her brain.
In reality, it almost can't NOT collapse. Barring a federal bailout, it will indeed collapse. The only way to avoid this is to massively curtail spending. If anyone thinks that crime will stay the same or go down once that happens they are delusional.
Detroit used to be a nice city as well. but even nice cities can't evade cold reality.