Monday, July 22, 2013

Detroit Rock City!

    According to  Albert E. Cobo  Mayor of Detroit, Mich., 1950-57; died in office 1957 was the last “Republican” Mayor of Detroit Michigan. Now before anyone goes crazy, remember internet searches don’t always tell the story, but in this case the information appears to be solid. I don’t want anyone to assume I would blame democrats for the woes that plague Detroit, but whom else should bear the weight of responsibility? Let’s look at some statistics about Detroit. First, crime stats from The city “boasts” an average drop of burglaries, rapes, robberies and assaults of about 8%. What the fancy website and it’s “crime tracker” don’t tell you is that population in Detroit in 2011 was 711,700, a change since 2000: -25.2%; which if math serves is more than three times the crime rate drop. One thing for sure; nothing brings down crime like fewer people to either commit the crimes or be victims of the crimes.

    The unemployment rate in Detroit is down to 16% (cough, cough) from a high of 27.8% in Jul 2009, after the “largest recession, since the Great Depression” (in quotes, since it’s the Obama administration’s excuse for every damn thing that has gone wrong in this country since his election). Sorry for the sidebar, but at some point even a child recognizes he is responsible for his own grades; except in the case of our president. There are only two main reasons unemployment rates go down; first economic growth (ie job creation) and second population changes. We all know what is driving the reduction in unemployment in Detroit, not to mention the country; fewer people looking for work. None of this explains how/why a city the size of Detroit could go bankrupt.

Bankrupt as defined by 
1.      Law. A person who upon his or her own petition or that of his other creditors  is judged insolvent by a court. 

    Short explanation you can’t pay your darn bills. Now many of us know someone who has gone bankrupt and some of us even know people who have recovered; so it’s not the end of the road completely. However, someone is going to pay the price. In the case of Detroit, most of the “losers” will be folks who hold bonds sold by the city. The rest of the “losers” are the people who the city owes a debt; like retirees of the city. The city worker retirees are the ones you will hear from loudest.

   Most of the historical “leaders” of Detroit were beholden to unions. Not just the UAW for votes, but the city public employee unions who have extorted the politicians for the several decades. Now before anyone goes rambling on about my union membership (full disclosure at this point; I am a member of a trade union), there is a huge IMO difference between trade unions and public service unions. The big difference is that public service unions are also the voters who choose the people who make the financial decisions for their union collective bargaining agreements. The two parties’ are involved in a contract negotiation with someone else’s money, with the politician facing the people he or she negotiates with at the end of their term when seeking re-election. Don’t believe this is some sort of anomaly, because this garbage goes on with every single public service union in the country. My point is simple; the country is a larger version of Detroit on its way to the same fate; pure and simple.

    Detroit has lost its ability to provide the services it is obligated to, by its charter and can’t even pay its outstanding debts. You may ask why, but most people won’t believe the answer. The answer is unpleasant and hard to believe, but it is simple. Once the public service unions have enough elected officials in office (say like in the 2010 Obama Care passing) your goose is cooked. No private sector company is willing to give in to ridiculous labor demands like the 75% of your pay pension based on your last year of service, while allowing those people to maximize their overtime, thus pushing up their pension exponentially. However, it has become a relatively normal and routinely accepted practice in public service union contracts. During good economic times like the late 80s or late 90s, the deficit problem is masked, but when the economy corrects its balance or even worse is run by an economic lightweight like Pres Obama, the debt overwhelms the entity that needs to pay the price.

    America is in desperate need of a true business savvy leader who can work within the system with a proven record to fix our fiscal woes on a federal level. Oh wait, we chose not to elect that guy and now, if America had a son it would look like Detroit.

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