Welcome to the post-sequester apocalypse. As much as President Obama will have us believe otherwise, the greatest financial catastrophe in the coming days will not be of Washington’s making at all.
If you’re looking to see what a policy of liberalism can do to a city, look no further then Rock City. Despite one of the most aggressive ECD campaigns featuring celebrities Eminem, Jeff Daniels and Tim Allen, not even Hollywood can save Detroit from going broke. It is on the verge of being taken over by the State of Michigan in hopes of saving the city from bankruptcy.
President Obama on October 13, 2012 stated that he “refused to let Detroit go bankrupt.” Well, Mr. Obama then you better be willing to write a very big personal check.
With over $3.8 billion in federal stimulus funds to the city in 2009, President Obama claimed during his reelection bid to be the city’s savior. On the same day that the world is supposed to end with the much-ballyhooed sequester going into effect, Detroit’s financial woes are the inevitable result of liberal tax and spend policies. These policies have led to an annual budget deficit of $100 million, which includes a total of $14 billion in employee retirement liabilities and unfunded pensions. In order for the City to be in the black again, (something they have not been since 2005), Detroit would need $1.9 Billion over the next five years to pay off other long-term liabilities.
As Bob Woodward has discovered, the paternity of the sequester lies squarely with President Obama. It was devised as a trap for the Republicans. The same can be said about the plan of action in regards to Detroit, which was nothing more then smoke and mirrors just to delay what was predictably going to happen. This result was inevitable considering Detroit has always been a city plagued with liberal policies and run by the labor unions.
This is only the beginning. Cities around the country like Stockton, CA, Jefferson County, Alabama and Harrisburg Pennsylvania are Cities traveling down the same path. These cities all share the common trait of continuously electing Democrat majorities to control their local Government. Like a string of dominoes, they are destined to fall one by one. When the states can no longer bail out the cities, who will be there to bail out the states? For example in California’s case, what happens when a State cannot rescue its own municipalities? Does the Federal Government step in and take over a State or does our Federal Government look to foreign investors to bail those States out?
The good news is, with every major bankruptcy or bad economic news that is announced it seems our stock market usually has an opposite effect and reaches for the sky. Chairman Bernanke and his minions at the Federal Reserve hope that this manipulated surge will continue the charade of growth in today’s economy giving the American people the false sense that our economy was not effected.
How quickly will the tribulations of the March 1st sequester be forgotten, once the upcoming consequences of what raising the debt ceiling on March 27th might yield. However, with the Federal Reserve printing no less then 85 billion dollars per month, this economic fairy tale has no chance for a happy ending for the City of Detroit and I fear the rest of the Country as well.
We are now hearing the usual voices of protest in Detroit in the wake of Michigan governor Rick Snyder appointing an outside expert to take over financial management of the near-bankrupt city.
Detroit is the largest city in American history to be seized in this fashion and turned over to an outside manager.
Reported deficit of the city is $327 million dollars and long-term liabilities are in the range of $14 billion.
But no matter to the unions, politicians, and bureaucrats who have been at the helm for years as the city has spiraled into the depths of the black hole in which it now finds itself. These interest groups, who have been the driving force behind this fiscal travesty, have one interest – to keep their respective beds feathered. Citizens and public welfare be damned.
So they cry foul when adult supervision is sent in to take on the formidable rescue task.
The man Governor Snyder has put in charge, Kevin Orr, is a high-powered Washington, DC black attorney who, according to USA Today, “has extensive experience in municipal finances, public infrastructure projects, public pension matters, and litigation.”
Al Sharpton’s man in Detroit, Rev. Charles Williams III, has called Orr an “Uncle Tom.”
The travesty now taking place in Detroit should be carefully watched by all Americans. This is not a one off exception to the rule, but is just the latest case study of a pathology dragging down the whole nation. And it’s a pathology for which low-income minority Americans are paying the dearest price.
Economist Dr. Walter Williams has noted that the common denominator of the nation’s ten poorest cities with populations over 250,000, of which Detroit is number one, is that they all have been controlled by liberal, Democratic mayors for decades, the majority of which have been black.
Detroit’s former mayor, Kwame Kilpatrick, son of former congresswoman and Congressional Black Caucus member Carolyn Cheeks-Kilpatrick, is now in jail awaiting sentencing after being convicted on 24 counts for running a criminal enterprise out of the mayor’s office.
The point is that we need to discern a rule of thumb here: the more that human lives are governed by compulsion and entitlement rather than freedom, choice, and personal responsibility, the outcomes are uniformly undesirable.
Compulsion and entitlement, meaning liberal government and union power, means less service, less efficiency, more fraud, corruption, and waste, and insensitivity to changes in the marketplace.
If we are going to save our cities, we need to get back to what built them in the first place: freedom, enterprise, and entrepreneurship.
It took a hurricane and a flood to wake up and turn around the basket case that was New Orleans. Ray Nagin, New Orleans’ mayor during Katrina, who blamed everyone but himself for the debacle that occurred, was just indicted on 21 counts of corruption.
New Orleans is now undergoing a renaissance. The public school system was turned over to a charter operator and the number of failing schools has dropped and test scores are improving.
Low taxes and a new spirit of entrepreneurship, spurred by such imaginative initiatives as Idea Village, has kept unemployment in New Orleans at less than two-thirds the national average.
Let’s get going with ideas like urban enterprise zones, championed by the late Congressman Jack Kemp, and now by economist Art Laffer, and give preferential tax treatment to employers and employees in blighted urban areas.
Abolish the minimum wage in these areas and give kids a chance at entry-level jobs and learning critical job skills.
The possibilities are only limited by our courage and imagination. But only one theme will save our large, urban cities, and their poor minority citizens.
Get them out from under political and union control and restore freedom, competition, and entrepreneurship.
Welcome to the post-sequester apocalypse. As much as President Obama will have us believe otherwise, the greatest financial catastrophe in the coming days will not be of Washington’s making at all. 
President Obama on October 13, 2012 stated that he “refused to let Detroit go bankrupt.” Well, Mr. Obama then you better be willing to write a very big personal check.
This is only the beginning. Cities around the country like Stockton, CA, Jefferson County, Alabama and Harrisburg Pennsylvania are Cities traveling down the same path. These cities all share the common trait of continuously electing Democrat majorities to control their local Government. Like a string of dominoes, they are destined to fall one by one. When the states can no longer bail out the cities, who will be there to bail out the states? For example in California’s case, what happens when a State cannot rescue its own municipalities? Does the Federal Government step in and take over a State or does our Federal Government look to foreign investors to bail those States out?
