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Although GM is on a path to recovery, its home city of ... Although GM is on a path to recovery, its home city of Detroit seems to be headed for bankruptcy (AP).
DETROIT, March 1 -- The city of Detroit must have an "emergency manager," to solve the city's financial emergency, according to Michigan Governor Rick Snyder, who made the pronouncement today. The move will essentially over-ride Detroit's elected government, and could be a pre-cursor to a bankruptcy for the "Motor City."

"I look at today as a sad day, a day I wish had never happened in the history of Detroit, but also a day of optimism and promise," Snyder said.

Detroit is in decay. But it wasn't always that way. In the 1950s and early 60s, it was one of the nation's most prosperous cities--the home of the U.S. auto industry, which dominated America's car-park its until Asian automakers began building up their market shares in the 1970s. It had nearly 2 million people at its height of prosperity.

Detroit today has become the butt of jokes and a national symbol of urban rot that many experts believe is irreversible without the city going through bankruptcy and a total re-think of the structure of the city. Exodus from the city, as well as corruption and mismanagement throughout the city's political and bureaucratic structure for decades has created a $327 million budget deficit and more than $14 billion in long-term debt.

The city cannot afford to pay its bills. The reason for the emergency manager, and the hope, is that one person who doesn't have to seek political consensus can plow through the obstacles and create some fast solutions.

The new manager, as yet un-named, will replace Mayor Dave Bing, a Hall of Fame NBA player for the Detroit Pistons in the 1960s and early 70s who went on to become a successful businessman in Detroit.

Mayor Bing on Friday said he doesn't favor Gov. Rick Snyder's decision to appoint an emergency financial manager for the city but is willing to work with Lansing to move the city forward.

"The governor has made his decision, and it was his decision alone to make. While I respect it, I have said all along that I do not favor an emergency manager for the city of Detroit. I will look at the impact of the governor's decision as well as other options, to determine my next course of action," Bing said in a statement.

Michigan has other emergency managers

Other Michigan cities have been taken over by emergency managers--Ecorse, Benton Harbor Highland Park, Pontiac and Allen Park. But Detroit will be the biggest challenge because of its size and scale.

The Emergency Manager Law is unpopular in Michigan, so much so that Michiganders voted to get rid of it by referendum last November. Snyder, and a Republican-controlled State House, have been so determined to use it on Detroit that they rushed through a new Emergency Manager Law in December, flouting the will of the voters a month earlier, and even attached it to a budget measure insuring that it won't be subject to another referendum.

Though Snyder's move was widely viewed as underhanded, he has some cover with many voters because Detroit's City Council and Board of Education has been so bad at their jobs for so long, with both institutions nailed for corruption. Voters outside Detroit do not want to see the State bailout Detroit.

The politics, of course

What remains to be seen in Snyder's move on Detroit is how much politics will be injected. The Governor, nor the Republican State House, has not much love for Detroit as it has been a reliable Democratic voting block for decades.

Karen Lewis, 49, a manager at a fast food store, reflected the resentment some residents feel at the takeover of the predominantly black and Democratic city by a predominantly white and Republican state government.

"It don't take a genius to know what this is all about," said Lewis, who is black. "They want our money and our land. No one cares about us. And we're the ones who stuck around. Not the white folks."

But Bernard Ragin, 41, said he was tired of living in a city that has seen a collapse of basic services. "I don't care who fixes Detroit, as long as the street lights work and the police show up on time," he said.

What ails Detroit is daunting for any manager who will dig into the books and recommend one way or the other if the city should file for bankruptcy.The managers power includes: The emergency manager will eventually have strong powers to develop a financial plan, revise or reject city budgets, consolidate departments, reduce or eliminate the salaries of elected officials, sell eligible assets, lay off workers and renegotiate labor contracts.

Five huge tasks and challenges

-The city's footprint once handled two million residents. With fewer then 700,000 living there, vast sections of Detroit are uninhabited, run down beyond repair and dangerous.
-The school system is atrocious, making it all the more unattractive for any family who would take a flyer on an inexpensive house.
-The city's infrastructure is out of date, has numerous toxic sites and decayed buildings that are expensive to tear down.
-There is unemployment above 20%, and a huge population of welfare recipients and single parents with children on public assistance.

Five signs of life and prosperity in Detroit

-General Motors, after its 2009 bankruptcy, is on a prosperous path of recovery, and has kept its downtown headquarters, which dominates the skyline.
-The Woodward Avenue corridor running north from the Detroit River has Comerica Park (home of the Detroit Tigers), Ford Field (home of the NFL's Lions), a world-class Detroit Opera House, a future arena for the Red Wings, and Wayne State University. It is a spine of economic activity and business and pulls people from the suburbs.
-Detroit is home to the Henry Ford Health Center, which is a top-notch network of healthcare. Cities can't mount comebacks without a strong healthcare system.
-Companies have been adding jobs downtown, including Chrysler, Quicken Loans and Blue Cross/Blue Shield.
-A creative community has been building in the city, drawn by cheap rents and opportunity.

With Reuters


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  • 487 Comments
      pennymoran
      • 2 Years Ago
      I think that Detroit should get down on it's knees and thank the great OZ Obama for saving them.....Since it's Government owned Motor Corp. They shouldn't be in any trouble at all. After all isn'tthat what our billions of dollars went for? The saving Detroit? Oh I'm sorry it was to save the re-election vote and the Union Bosses. The hell with 'the people'. Since they kissed the ring ofthe great OZ they certainly can't be having any financial problems - after all they've been Democratic Party owned for decades and they have 'brought home the pork/bacon' haven't they?
      jaybeach8
      • 2 Years Ago
      That's funny. Just the other day, one of Detroit's councilors was saying she expected Obama to come to the rescue. It was only right, she said, "because we voted him in." See what you get when you're stupid?
      kay
      • 2 Years Ago
      Very sad to see a once wonderful place in the dumps now. SAD, SAD, SAD. America wake up we need to stop paying and sending money we dont have to aid other countries. Not to mention allowing them in here to live off the system open up businesses, drive luxury vechiles and claim hardships and take take take!!!! Its sickens me I see it all around. Funny how when my ancestors came here there were no freaking hand outs you worked hard and thats how it went. If you didnt have food you have food, clothes etc.
      • 2 Years Ago
      In 1832 a young army liutenant was sent to lay the southern border of the new proposed state of michigan. His name was Robert E. Lee. Native of Virginia and West point graduate. He came upon a large vast area of swamp when surveying the border, so he instructed his men to turn "South" about 5 miles to avoid it. Only problem was when they got to Lake Erie the wealthy city of Toledo, Ohio would be part of Michigan. Damn near caused a war. They comprised - Michigan got the Upper Peninsula and Ohio kept Toledo, future home of Corporal Klinger from M*A*S*H.
      johnottr28
      • 2 Years Ago
      Some other cities like Detroit Phoenix Phoenix's rental vacancy rate is the fifth highest at 19 percent. Greensboro, N.C. Greensboro has the second highest home vacancy rate at 5.9 percent. Atlanta, GA Atlanta's rental vacancy rate ranks eighth; its home vacancy rate is tied for sixth. Orlando, FL. Orlando's home vacancy rate is the 11th highest at 7.3 percent. Rental vacancies reached 12.3 percent. vacancy rate ranks eighth; its home vacancy rate is tied for sixth Kansas City, Mo. The metro area's rental vacancy rate is 15.2 percent, placing 12th. Its home vacancy rate is 3.6 percent, the same rate as Jacksonville, Fla. Indianapolis The city's rental vacancy rate of 17.1 percent ranks sixth among major cities. Its housing vacancy rate is much lower at 3.2 percent.
      • 2 Years Ago
      I just learned how Snyder is going to pay for Detroits ( rehabilitation ) 1. Put that a-hole Kilpatrick in prison to rot with all his cronies... 2. Bulldoze all the rat traps.... 3. Work for homestead land grants 4. Bring in Habitat for humanity group to rebuild homes 5. I'm sure Detroit qualifies for F.E.M.A.'s funding structures ( it is a disaster ) 6. Giving Federal dollars to re-build will let all peoples tell Jesse Jackson and Al--Shake-down Sharpton to shut the F.... Up and insight some place else...... And last but not least Gov Snyder that new tax bill you rammed down our throats Last year well now we know your bending over retired native sons and daughters That have come home to Michigan. Look Jack we've been taxed 3 times already In another state. We choose to come home and be treated like this F.Y.
      kev4fun2day
      • 2 Years Ago
      Just a microcosm of what will be happening across the USA in a few more years. Too little tax revenue coming in and spend, spend, spend, spend, ...
      Tom
      • 2 Years Ago
      This is exactly what you get with Liberal / Democratic leadership and Union political control... Wonder if we can just give Detroit to Canada?
      golemur
      • 2 Years Ago
      golemur Let us not be confused. It is not the city of Detroit that is bankrupt. But the people of Detroit. Both morally and monetarily Not all the people but by far the majority. I truly believe it to be a great city. Incorporated 1701. 24 minutes ago +3
      WallOfVoodoo
      • 2 Years Ago
      This is just the beginning of ALL the cities in America following suit. The Democrats(the Cannites) will see to that. Tax the productive and give it to the non productive. Great business sense these politicians have.
      whiteoak
      • 2 Years Ago
      They need to start raking in a cut from the drug dealers,,,,most drugs in the Midwest trace back to Detroit
      • 2 Years Ago
      The demise of Detroit dates back to assassination of MLK in the 60s and the riots across Detroit afterwards. After the riots, normal middle class people moved out, a divisive black mayor was elected and reigned for 30 years depleting the city of any chance to recover. Detroit implemented a city INCOME TAX, which put the nail in the coffin. Who in their right mind wouldn't move 30 minutes away to a city without the additional tax except for those without income that don't pay taxes! For the most part, only poor people on welfare remained within the city limits. Middle and upper class people that actually work in the city commute. That mayor killed Detroit! It really didn't have much to do with unions or the auto industry.
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