Detroit requests bankruptcy protection

[bobabode]

More...
http://www.youtube.com/watch?v=0WxgeYXCjM8

[CarlV]

Originally Posted by bobabode

I would go, if for nothing else than to see where some of the best American music ever recorded was made.

Motown, baby!

Don't forget the MC5 - doing the John Lee Hooker song about Detroit riot in 1937?
https://www.youtube.com/watch?v=uFqxMhmI3iw

Sad, 50 years ago the most affluent city in the USA. It will rise from the dead.



Carl

[Charles]

Originally Posted by icenine

At least Whell is not afraid to walk point over here in this largely left leaning chat site. Have to admire him for that.

Agreed.

And he is punished for it daily.

Chas

[whell]

Originally Posted by Pukka Sahib

The bankruptcy will provide Detroit the opportunity to restructure that otherwise would be unavailable. There are many advantages under the reorganization process; and now is the time to take them.
http://www.freep.com/article/2013071...County-Alabama

I'm not sure how much of this I agree with. I'll have to see if play out, I guess, and then see how the chips fall.

I wonder if its a mistake to compare Detroit's pending bankruptcy to a for-profit company going through bankruptcy. In a for - profit's case, for example, they can construct a turn-around plan that is based on the company's ability to generate increased profits over time. Detroit can't do that. Detroit's tax base has been declining for decades, and shows no sign of turning around. To turn around a city's tax base, you have to have individuals and families who are willing to move into the city in droves and start paying taxes. Detroit can't attract families due to the unsafe and unappealing condition of most neighborhoods, and families with school-age kids won't come due to the reputation of Detroit's schools (Detroit's school system also has its own "emergency manager"). Detroit can't attract businesses without offering some sort of enterprise zone or tax incentive, and Detroit needs new business to start paying taxes now. It just seems that the prospects of coming out of bankruptcy with a long - term sustainable financial plan are pretty slim for Detroit.

[whell]

Originally Posted by CarlV

Don't forget the MC5 - doing the John Lee Hooker song about Detroit riot in 1937?
https://www.youtube.com/watch?v=uFqxMhmI3iw

Sad, 50 years ago the most affluent city in the USA. It will rise from the dead.

Carl

The MC5 were the house band at the once-famous Grande Ballroom. The condition of the Grande Ballroom today, versus how it was when the Who introduced Tommy to the USA from the Grande Ballroom's stage, seems analogous to the fall of the city.

Before: http://thegrandeballroomstory.com/pictures/

After: http://www.flickr.com/photos/detroitderek/2255585682/

[Oerets]

With Detroit is it not the cost of pensions, benefits along with pay for current and former employees the largest expenditures? Rates based on a level of revenue from taxes collected in the past that now is changed for the worst.

But selling assets and privatizing now public works to me is a short term solution to the problem. This a national problem one any city or state can or may face because of the way business and industry will move. Move to get tax breaks in a new location or to avoid labor disputes.

When will cities realize they are hurting themselves in the long run for short term gain in employment by offering these discounts to employers. The companies have now loyalty only for the bottom line. Very evident they don't care a hoot for the employee's!


Barney

[whell]

Originally Posted by bobabode

Oh, please. You guy's memories always seem to stop at Roosevelt 2. Kinda disengenuous of you to bitch about someone else's recollections, doncha think?

Not at all. Its been pretty thoroughly discussed, at least around these parts anyway, when the decline of the city began. Its this post - depression, post war period that really ignited the decline. When someone is incorrectly recalling the facts, don't you think the kind thing to do is show them why their recollections may be incorrect?

Everyone talks about "white flight" that occurred in big cities like Detroit. Folks with shorter memories attribute white flight in Detroit to the race riot here in '67. Fact is, it started before that. When GI's were returning home after the war, there was already a housing shortage in the cities. The lack of new homes built during the depression and WWII coupled with millions of GI's returning from the War and looking to get on with their lives created a dramatic shortage. New home construction began in earnest following the end of the war. The house I grew up in was one of those post-WWII homes that sprouted like mushrooms during that period, and few of them were built in Detroit because land wasn't readily available, and if it was, it was expensive (made in many cases more expensive by FHA policies).

Those who wanted to move out of the city into shiny new suburban homes couple easily do so, and did so in droves, supported by the GI bill of 1944 provided money to educate and build houses for the returning soldiers. This began the migration out of the cities, including Detroit. Later, in 1958, the Interstate Highway Act connected all the major cities in the US with highways. This marked the official beginning of the scenario now known as urban sprawl. This gave more momentum to the exodus from the cities.

Later in Detroit, the 1967 riots occurred, and those who needed just one more reason to leave the city finally had it. And it wasn't just whites who left the city. Border cities like Southfield, Oak Park, etc, had significant non-white population growth.

[whell]

Originally Posted by Pukka Sahib

Municipal reorganization under Chapter 9 of title 11 works with consistent regularity. The bankruptcy provisions are flexible enough to deal with virtually any scenario; and Chapter 9 has the added benefit of not being as susceptible to the jurisdictional problems associated with other chapter proceedings recently exposed by the Supreme Court decision in Stern v. Marshall. I'm surprised that Mr. Orr didn't take this step sooner rather than digging a deeper hole. There has to be some point at which you come to grips with the problem and do something effective about it.

Orr was just appointed to the job in March 2013. Before you go straight to bankruptcy, you have to at least make the attempt to negotiate with creditors. Or spent the first few months of his job doing that. However, I think everyone knew that Orr was bent on getting to the bankruptcy step as soon as possible. The creditors all knew it, since few of them were open to dealing with the city or cutting any deals.

Still, there has to be some prospect for a reliable income stream for any surviving entity, public or private. I have no idea where this income stream will be coming from for Detroit. The population is still decreasing.

[whell]

Originally Posted by Oerets

With Detroit is it not the cost of pensions, benefits along with pay for current and former employees the largest expenditures? Rates based on a level of revenue from taxes collected in the past that now is changed for the worst.

But selling assets and privatizing now public works to me is a short term solution to the problem. This a national problem one any city or state can or may face because of the way business and industry will move. Move to get tax breaks in a new location or to avoid labor disputes.

When will cities realize they are hurting themselves in the long run for short term gain in employment by offering these discounts to employers. The companies have now loyalty only for the bottom line. Very evident they don't care a hoot for the employee's!


Barney

With Detroit, those are all factors. But the crusher is the accumulated long term debt. The number is pegged at around $17 billion, and Detroit barely has the money to keep the lights on and the water running, much less keep up with the interest payments on that debt.

[whell]

Originally Posted by Pukka Sahib

The "good faith" negotiations should have commenced a long time ago; and, in terms of "emergency management", concluded the first day of Mr. Orr's appointment.

No doubt. But that's yet another reflection on how the city has been run for many, many years.