Detroit goes bankrupt, largest municipal filing in U.S. history
Detroit filed the largest municipal bankruptcy in the nationís history Thursday, marking a new low in a long decline that has left the U.S. automaking capital bleeding residents and revenue while rendering city services a mess.
The city, which was the nationís fourth-largest in the 1950s, with nearly 2 million inhabitants, has seen its population plummet to 700,000 as residents fled rising crime and deteriorating basic services, taking their tax dollars with them.
In March, as Detroit faced an estimated debt of $19 billion, Michigan appointed an emergency manager vested with extraordinary powers to rewrite contracts and liquidate some of the cityís most valuable assets. That led to once-unthinkable proposals such as forcing public employees to cut their retirement benefits or demanding that investors in municipal bonds ó long considered among the safest investments ó take pennies on the dollars they lent to Detroit. In recent days, both of those groups objected, propelling the city to file for bankruptcy.
In a sign of Detroitís dire fiscal situation, few officials and lawmakers in Michigan or Washington vigorously protested the decision ó a far cry from the 1970s, when President Gerald R. Ford intervened with federal loans to prevent New York City from falling into bankruptcy. That there is far less stigma now could encourage other distressed cities and towns to follow Detroitís lead, some analysts worry.
Detroitís deterioration, which started in earnest after the 1967 race riots were among the most violent in the countryís history, has accelerated in recent years.
In the 1950s, Detroit, known worldwide as the Motor City, had one of the highest per capita incomes in the country when auto plants were hiring wholesale. Now it has the highest rate of violent crime among the nationís big cities. Average police response time is almost an hour. Nearly 80,000 buildings are abandoned or seriously blighted, and 40 percent of the cityís streetlights do not work. The jobless rate is above 18 percent, more than twice the national rate.
The abysmal services encouraged more people to flee. The city lost more than a quarter-million residents from 2000 to 2012. Tax revenue and state aid have plummeted as the auto industry hit hard times, crimping Michiganís finances. Its best-known cultural export, Motown Records, left long ago.
To plug its deficits, the city borrowed huge sums over the years. And the state-appointed emergency manager, Kevyn Orr, a former D.C. bankruptcy lawyer, was unable to forge a deal with creditors.
Detroit files largest municipal bankruptcy in U.S history - The Washington Post
Wait until that happens to America. I really don't think it's that far off if we can't slow down our borrowing.
Good article. Thank you for bringing this to my attention.
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My alternative universe...
AsŪ pues, aquŪ estamos.
"too big to fail" only lasts as long as everything is not failing...
once everyone has the same sized cock then size doesn't matter...
Grim and grimmer
$10.20 Per Hour Needed To Survive Even In America's Cheapest County
Nowhere in America does a dollar go farther than in Hanson County, South Dakota. But even there, a worker still needs to earn nearly $3 more than the minimum wage to get by.
Dawn Holmberg, a 43-year-old single mom living just west of Hanson County, knows all too well how to make a dollar stretch as far as it can. She works as a cashier earning $10.50 an hour. That's more than the minimum wage, but nearly $7 lessthan what it takes for a worker with one kid to afford basic expenses in the region, according to an analysis produced for The Huffington Post by Wider Opportunities for Women, a non-profit advocacy organization aimed at boosting low-income women and families.
“We don’t do anything, we stay home,” Holmberg said of her budgeting strategy. “The kids get what they need. Money’s tight all the time.”
Even a worker with no kids living in Hanson would need to earn $10.20 an hour to achieve basic economic security, according to WOW researchers.
The $10.20 wage is nearly $3 more than the current federal minimum wage of $7.25 an hour, which is also the minimum wage in South Dakota. In 2012, there were about 12,000 workers in South Dakota subsisting on paychecks at the minimum wage or below, according to the Bureau of Labor Statistics.
WOW defines economic security as having enough money to afford basic necessities like housing, food, utilities, emergency savings and childcare expenses (for workers with kids), but no room for extras, according to Shawn McMahon, WOW’s acting President and CEO. A worker earning the $10.20 wage in South Dakota would make a yearly income that's enough to put them about $9,000 above the federal poverty threshold, but not enough to protect them from economic insecurity.
“In the place with the lowest cost of living the minimum wage falls far short,” McMahon, told HuffPost. “In most places in America we need either multiple earners or multiple minimum wage jobs to even achieve any type of economic security.”
WOW’s researchers found that it would take a minimum wage of $14.17 an hour for workers to achieve economic security nationally. In areas of the country where the cost of living is high, the federal minimum wage covers a small fraction of what it takes to afford basic needs, the analysis found. In Montgomery County, Maryland, the area where the cost of living is highest, it takes a minimum wage of $23.65 for a worker to achieve basic economic security.
Montgomery County borders Washington D.C., which has recently become a battleground in the fight over paying workers a living wage. The D.C. City Council passed a bill earlier this month requiring large retailers in the city to pay their workersat least $12.50 per hour, more than $4 more than the city's minimum wage. Walmart has threatened to pull three planned stores in the city if Mayor Vincent Gray signs the bill into law.
WOW's findings add to the growing body of evidence that the minimum wage is too low to provide a living wage for most Americans. President Obama aimed to tackle this problem by proposing to raise the minimum wage to $9 per hour in his State of the Union address earlier this year, a plan that was shot down by leading Republicans.
Holmberg acknowledges that her wage, which is both higher than Obama's proposal and the minimum wage in her state, provides enough to ensure “we’re not living in poverty.” Still, after rent, utilities, child care and groceries, she says, she has little money left to save, let alone spend on discretionary items.
“We just live paycheck to paycheck,” she said. “It is hard. We spend a lot of time at the park or at the lake, something that doesn’t really cost anything to do.”
Damn, cluezo. This is pure debt porn with a healthy dollop of economic pessimism. This may send snaff into such a concentrated fit of wanking the poor lad may burst a blood vessel.
I didn't think the minimum wage was for adults. Was it set up that way?
America is falling... what worries me the most, is there is no pick-me-up quite like war.
Jesus is coming, open your mouth!
About 20% of American adults who have jobs are earning only $10.65 an hour or less, according to Osterman's analysis. Even at 40 hours a week, that amounts to less than $22,314, the poverty level for a family of four.
Minimum wage jobs leave millions in poverty - Sep. 27, 2011