Detroit is bankrupt. A combination of intense union cronyism, massive red tape and vile political tactics (The Curly Effect) drove the metropolitan area into the ground. Once described as the Paris of the West, the Motor City was brought to its knees by the progressive policies that its political class rabidly pursued. Unsurprisingly, there are many Democrat-controlled cities across the nation facing the exact same problems Detroit is now succumbing to. But bankruptcy is not all bad; in fact it’s just what the doctor ordered!
Here are 4 reasons bankruptcy is just the medicine Detroit needs.
- Flushes the Bad Spending!
Bankruptcy proceedings wipe the slate clean for a city, allowing politicians to look anew at the difference between discretionary and essential spending. If elected officials are no longer constrained by the spending promises of the past - typically made in economic boom - the taxpayer will be spared. Escaping the oppressive responsibility of lavish and opulent defined benefit pensions and other spending would do wonders for local treasuries. If we liken the city to a person, bankruptcy is like an exotic cleanse that flushes out all the fiscal rubbish that has built up over time.
- The City Can Turn Dead Weight Into Future Tax Revenue!
Bankruptcy means that the government has to liquidate all its assets for rock-bottom prices. This means that successful businesses can buy up these capital goods and put them to productive use. When something is owned by the government, it’s maintained at the taxpayer’s expense. If something is owned privately, it’s being put to productive use by a business. Selling assets does a government doubly good because they receive profit from the sale and subsequent tax revenue from the successful private industry that was expanded by the purchase.
- Lavish Government Pensions Finally Get Fixed!
Government employees and their overbearing unions have been on a decades-long crusade to defraud the taxpayer and unjustly enrich themselves. When everyday Americans are struggling to find job security and save for retirement with defined contribution plans, selfish and greedy public sector unionists have unparalleled job security and retire with golden parachutes that would make any middle-American look like a pauper in comparison. Bankruptcy would require states to reform these inexcusable pension systems and make them more in line with what millions of Americans already have.
- Statesmen-Not Special Interests- Will Govern Once Again!
With golden pension plans made more reasonable and calcified spending patterns made flexible again, political cronyism will be greatly reduced. Politicians who get elected based on the pork that they give to their fat-cat union buddies or business friends will have these regular wealth-transfers cut in bankruptcy. Truly awful politicians who survive by doling out your tax money to crony supporters will finally lose their political cover. When bankruptcy comes to the statehouse true statesmen won’t be far behind!
Our states and municipal governments face bankruptcy and that’s good news! When our government declared bankruptcy in the past, great things happened. We can save Detroit and restore it to its former glory as the Paris of the United States, if only President Obama does not interfere.