From The Detroit Free Press By Way Of Via Media: ‘How Detroit Went Broke’

Full piece here.

Very comprehensive and easy to navigate.

‘Other cities also have profound problems today — Chicago, Providence, R.I., Baltimore. But only Detroit is in bankruptcy court.’

A sad tale that didn’t have to end up here:

Even by the late 1950s, the signs of strain were showing in industrial cities. Population and housing values peaked in Detroit in the 1950s and began their long and seemingly unstoppable decline. The urban riots of the 1960s, including Detroit’s, accelerated the process.

By the 1960s, in Detroit as in city after city, the process was well under way. And mayors and civic leaders, here and elsewhere, began their long, anguished battle against decline.

The more people that left, the more the city leaders raised taxes and drove more people out until it became a wasteland of decay, increasing mismanagement and corruption.

America:  Tackle your pension problems and municipal debt issues now to help avoid this cruel fate.  The pie needs to be growing.

See this piece from Urbanophile:

‘The last thing Detroit teaches us is that America too often doesn’t learn from its mistakes.  Detroit’s troubles have been evident for quite some time, yet it’s hard to see that many other post industrial cities have managed to carve out a different path.  Rather, they pretended that Detroit’s fall was somehow unique due to its auto industry dependence – and managed to ignore other failed cities as well – while embarking on the same turnaround strategy via conventional wisdom and silver bullets.

Another quote, this time from Ira Stoll:

‘Indeed, if there is a single fact that sums up the state of American political economy at the present moment, it is this: the Boston office building once home to Inc. Magazine and Fast Company, which chronicled and celebrated small and fast-growing businesses, is now the headquarters of a publication called “Compliance Week.”’

Will the tech sector fill the hole?  Fracking, low-taxes and new investment in industry?  An information and knowledge-based economy?

How close are we to drifting into a higher-tax, heavily-regulated, less dynamic, federally managed State of affairs?

Nationalized and potentially socialized health-care?

Take him to Detroit:

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Some links on this site: Charlie LeDuff, Detroit’s populist, citizen journalist’s youtube channel here.  At least he’s sticking around.

Are you looking at beautiful photos and feeling sorry for Detroit, and yourself?  See Time Magazine’s photo essay by Yves Marchand and Romain Meffre (less porn-like, more thoughtful).

Hipster hope, artists, collectivists and small business types can’t save it either:  A Short Culture Wars Essay-Two Links On Detroit & ‘Ruin Porn’

GM is not a municipality, but good money got put in, probably after bad and it reeks of politics: From The Detroit News: ‘How The Treasury, GM Stock Deal Got Done’

What about the popular arts and culture?:Update And Repost-From Grist.Org Via The New Republic Via The A & L Daily: ‘Getting Past “Ruin Porn” In Detroit’…A Few Thoughts And A Tuesday Poem By Philip Levine

A garage sale for the city’s art? Virginia Postrel At Bloomberg: ‘Detroit’s Van Gogh Would Be Better Off in L.A.’From The Detroit Free Press: ‘DIA’s Art Collection Could Face Sell-Off To Satisfy Detroit’s Creditors’

Walter Russell Mead takes a look at the blue model (the old progressive model) from the ground up in NYC to argue that it’s simply not working.  Check out his series at The American Interest

From Bloomberg: ‘Detroit Recovery Plan Threatens Muni-Market Underpinnings’

From The Detroit Free Press: ‘Detroit Files For Chapter 9 Bankruptcy Amid Staggering Debts’

Full piece here.

Well, it’s official, as Detroit cannot avoid bankruptcy any longer:

‘The filing begins a 30- to 90-day period that will determine whether the city is eligible for Chapter 9 protection and define how many claimants might compete for the limited settlement resources that Detroit has to offer. The bankruptcy petition would seek protection from creditors and unions who are renegotiating $18.5 billion in debt and other liabilities.’

As written before: The industry went away, but also, the Model Cities program as part of LBJ’s ‘Great Society‘ helped incentivize the city so that its politics became a system of patronage and its treasury like a cookie jar. It was a slow, increasingly corrupt decline, with many of the people who could leave having left (serious white-flight, some black-flight). The ones who did stay continued to argue over a shrinking pie as the tax revenue dwindled and the lights eventually shut off.

Detroit has been extrodinarily poorly managed…more to come, no doubt.

Addition: Over four years ago, when GM stock was selling at $2 a share and the debt-holders had been wiped out, this blog put up the video below.  Here’s a brief 2:00 min explanation by Bill Ackman of Pershing Square on why the GM bailout was likely a bad idea:

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Exactly the kind of civil service, bureaucracy, and vast redistributive apparatus that helped lead to Detroit’s decline is likely being implemented with Obamacare right now.  Eventually you run out of other people’s money, and many of promises made to push the bill through hid costs.

Addition: Michael Barone reviews Charlie LeDuff’s book, and discusses how growing up in Detroit in the 60’s turned him into a conservative (Barone).

Some links on this site: Charlie LeDuff, Detroit’s populist, citizen journalist’s youtube channel here.  At least he’s sticking around.

Hipster hope, artists, collectivists and small business types can’t save it either:  A Short Culture Wars Essay-Two Links On Detroit & ‘Ruin Porn’

GM is not a municipality, but good money got put in, probably after bad and it reeks of politics: From The Detroit News: ‘How The Treasury, GM Stock Deal Got Done’

What about the popular arts and culture?:Update And Repost-From Grist.Org Via The New Republic Via The A & L Daily: ‘Getting Past “Ruin Porn” In Detroit’…A Few Thoughts And A Tuesday Poem By Philip Levine

A garage sale for the city’s art? Virginia Postrel At Bloomberg: ‘Detroit’s Van Gogh Would Be Better Off in L.A.’From The Detroit Free Press: ‘DIA’s Art Collection Could Face Sell-Off To Satisfy Detroit’s Creditors’

Walter Russell Mead takes a look at the blue model (the old progressive model) from the ground up in NYC to argue that it’s simply not working.  Check out his series at The American Interest

From Bloomberg: ‘Detroit Recovery Plan Threatens Muni-Market Underpinnings’

Richard Epstein At Defining Ideas: ‘The End Of Unions?’

Full piece here.

Maybe, maybe not, but Epstein makes a principled case for Michigan’s recent right-to-work bill.

Libertarians who only see liberty from where they sit, and the growth of big government and big labor since the New Deal, might need to make a better case for their cause to the public, Epstein argues (libertarians tend to rise in opposition to particularly liberal administrations):

‘The call for limited government doesn’t start with the radical proposition to disband the army, fire the police, or close public highways. Rather, it relies on the theory of public, or collective, goods. The sound theory of limited government uses the state to provide those essential public goods that ordinary individuals, acting either alone or in combination, cannot supply for themselves in voluntary markets.’

He finishes with:

‘Political leaders can be expected to hold back their punches to get legislation through. But the job of independent intellectuals is to offer principled defenses of these legislative changes in order to maintain the long-term coherence of, in my case, libertarian thought, which is needed to make future labor market reforms possible.’

Click through for a good defense against unions when laws are used to protect them, as they become an industrial cartel free-riding on the public good.   That’s the line to draw, Epstein suggests.

Many people, quite frankly, find the moral case for government involvement in basic services compelling (taking people’s money involuntarily and promising to do things that voluntarily people would not do, nor do enough of).  They are well aware that people are self-interested, sometimes selfish, and that there’s plenty of suffering and scarcity in the world.

Libertarians might find it hard to believe that to many Americans, the slippery slope argument fails, even if you point out that the slope can often involve free riding, inefficiencies, crony capitalism, reduced employment, reduced consumer choice and ultimately reduced economic and political liberty for all Americans.  The system, for them, is solid, and functioning pretty well.

Obamacare supporters, in fact, point out the inefficiencies of our current health-care delivery system, the waste, the downsides of ‘the profit motive’ (as though it won’t be central going forward) as they argue that health-care is a fundamental right and function of the government.

Pointing out that modern liberalism isn’t like the old classical liberalism also sounds extreme to many Americans.  The case will need to be made, solidly and reasonably, of the dangers already in our culture and institutions.  Libertarians, as skeptically as they are viewed by conservatives, have a good handle on the faith that modern progressivism has in reason and the interests many modern liberals have in growing the State, and what can occur in the wake of that faith and those interests to freedom, opportunity, and the human spirit.

See also: Free riding in Canada, and threats to free speech when a Human Rights Commision acts like a kind of quasi-court: Update And Repost: ‘A Canadian Libertarian Making Noise: Ezra Levant’

Related On This Site:  Covering the law and economics from a libertarian perspective: Richard Epstein At The Hoover Institution Journal: ‘Three Cheers for Income Inequality’Richard Epstein At The Hoover Institution: ‘Death By Wealth Tax’Richard Epstein At The Hoover Institution: ‘The Obamacare Quaqmire’

The anarchic tradition on this site:  A Few Thoughts On Robert Nozick’s “Anarchy, State and Utopia”… …Via Youtube: (1 of 3) Kant, Chomsky and the Problem of KnowledgeLink To Lew Rockwell Via A ReaderRepost-Two Quotations By Albert Jay Nock in ‘Anarchist’s Progress’…minimal state…Repost-Youtube Via Libertarianism.Org-David Friedman: ‘The Machinery Of Freedom

The classical liberal tradition…looking for classical liberals in the postmodern wilderness: Isaiah Berlin’s negative liberty: A Few Thoughts On Isaiah Berlin’s “Two Concepts Of Liberty”… From George Monbiot: ‘How Freedom Became Tyranny’…Looking to supplant religion as moral source for the laws: From The Reason Archives: ‘Discussing Disgust’ Julian Sanchez Interviews Martha Nussbaum.New liberty away from Hobbes?: From Public Reason: A Discussion Of Gerald Gaus’s Book ‘The Order of Public Reason: A Theory of Freedom And Morality In A Diverse And Bounded World’…Richard Rorty tried to tie postmodernism and trendy leftist solidarity to liberalism, but wasn’t exactly classically liberal:  Repost: Another Take On J.S. Mill From “Liberal England”

Originalism vs. The living constitution: George Will Via The Jewish World Review: ‘True Self-Government’..Still fighting the battles of the 60′s…? A Few Thoughts On Robert Bork’s “Slouching Towards Gomorrah”…Catholic libertarianism: Youtube Via Reason TV-Judge Napolitano ‘Why Taxation is Theft, Abortion is Murder, & Government is Dangerous’