Showing posts with label Detroit. Show all posts
Showing posts with label Detroit. Show all posts

Wednesday, April 24, 2013

America The Fallen: 24 Signs That Our Once Proud Cities Are Turning Into Poverty-Stricken Hellholes



Hellholes - Photo by LyzadangerWhat is happening to you America?  Once upon a time, the United States was a place where free enterprise thrived and the greatest cities that the world had ever seen sprouted up from coast to coast.  Good jobs were plentiful and a manufacturing boom helped fuel the rise of the largest and most vibrant middle class in the history of the planet.  Cities such as Detroit, Chicago, Milwaukee, Cleveland, Philadelphia and Baltimore were all teeming with economic activity and the rest of the globe looked on our economic miracle with a mixture of wonder and envy.  But now look at us.  Our once proud cities are being transformed into poverty-stricken hellholes.  Did you know that the city of Detroit once actually had the highest per-capita income in the United States?  Looking at Detroit today, it is hard to imagine that it was once one of the most prosperous cities in the world.  In fact, as you will read about later in this article, tourists now travel to Detroit from all over the globe just to see the ruins of Detroit.  Sadly, the exact same thing that is happening to Detroit is happening to cities all over America.  Detroit is just ahead of the curve.  We are in the midst of a long-term economic collapse that is eating away at us like cancer, and things are going to get a lot worse than this.  So if you still live in a prosperous area of the country, don’t laugh at what is happening to others.  What is happening to them will be coming to your area soon enough.


The following are 24 signs that our once proud cities are turning into poverty-stricken hellholes…


#1 According to the New York Times, there are now approximately 70,000 abandoned buildings in Detroit.


#2 At this point, approximately one-third of Detroit’s 140 square miles is either vacant or derelict.


#3 Back during the housing bubble, an acre of land in downtown Phoenix, Arizona sold for about $ 90 a square foot.  Today, an acre in downtown Phoenix sells for about $ 9 a square foot.


#4 The city of Chicago is so strapped for cash that it is planning to close 54 public schools.  It is being estimated that Chicago schools will run a budget deficit of about a billion dollars in 2013.


#5 The city of Baltimore is already facing unfunded liabilities of more than 3.2 billion dollars, but the city government continues to pile up more debt as if it was going out of style.


#6 Today, the murder rate in East St. Louis is 17 times higher than the national average.


#7 According to USA Today, the “share of jobs located in or near a downtown declined in 91 of the nation’s 100 largest metropolitan areas” between 2000 and 2010.


#8 Between December 2000 and December 2010, 48 percent of the manufacturing jobs in the state of Michigan were lost.


#9 There are more than 85,000 streetlights in Detroit, but thieves have stripped so much copper wiring out of the lights that more than half of them are not working.


#10 The unemployment rate in El Centro, California is 24.2 percent, and the unemployment rate in Yuma, Arizona is an astounding 25.6 percent.


#11 It has been estimated that there are more than 1,000 homeless people living in the massive network of flood tunnels under the city of Las Vegas.


#12 Violent crime in the city of Oakland increased by 23 percent during 2012.


#13 If you can believe it, more than 11,000 homes, cars and businesses were burglarized in Oakland during 2012.  That breaks down to approximately 33 burglaries a day.


#14 As I have written about previously, there are only about 200 police officers assigned to Chicago’s Gang Enforcement Unit to handle the estimated 100,000 gang members living in the city.


#15 The number of murders in Chicago last year was roughly equivalent to the number of murders in the entire country of Japan during 2012.


#16 The murder rate in Flint, Michigan is higher than the murder rate in Baghdad.


#17 If New Orleans was considered to be a separate nation, it would have the 2nd highest murder rate on the entire planet.


#18 According to the Justice Department’s National Drug Intelligence Center,  Mexican drug cartels were actively operating in 50 different U.S. cities in 2006.  By 2010, that number had skyrocketed to 1,286.


#19 Back in 2007, the number of New York City residents on food stamps was about 1 million.  It is now being projected that the number of New York City residents on food stamps will pass the 2 million mark this summer.


#20 The number of homeless people sleeping in the homeless shelters of New York City has increased by a whopping 19 percent over the past year.


#21 As I noted yesterday, approximately one out of every three children in the United States currently lives in a home without a father.


#22 In Miami, 45 percent of the children are living in poverty.


#23 In Cleveland, more than 50 percent of the children are living in poverty.


#24 According to a recently released report, 60 percent of all children in the city of Detroit are living in poverty.


As I mentioned at the top of this article, the decline of the city of Detroit has become so famous that it has actually become a tourist attraction.  The following is a short excerpt from an article in the New York Times


But in Detroit, the tours go on, in an unofficial capacity. One afternoon at the ruins of the 3.5-million-square-foot Packard Plant, I ran into a family from Paris. The daughter said she read about the building in Lonely Planet; her father had a camcorder hanging around his neck. Another time, while conducting my own tour for a guest, a group of German college students drove up. When queried as to the appeal of Detroit, one of them gleefully exclaimed, “I came to see the end of the world!”



For much more on the shocking decline of one of America’s greatest cities, please see my previous article entitled “Bankrupt, Decaying And Nearly Dead: 24 Facts About The City Of Detroit That Will Shock You“.


So are there any areas of the country that are still thriving?


Well, yes, there are a few.  In particular, those areas that are sitting on top of energy resources tend to be doing quite well for now.


One example is Texas.  In recent years people have been absolutely flocking to the state.  There are lots of energy jobs, the cost of living is low and there is no state income tax.


But overall, things are really tough out there.  Over the past decade America has lost millions of good jobs to offshoring, advancements in technology and a declining economy.


Last year, the United States had a trade deficit with the rest of the world of more than half a trillion dollars.  Overall, the U.S. has run a trade deficit with the rest of the world of more than 8 trillion dollars since 1975.


All of that money could have gone to U.S. businesses and U.S. workers.  In turn, taxes would have been paid on all of that income which could have helped keep our cities great.


But instead, our politicians have stood idly by as we have lost tens of thousands of businesses and millions of jobs.  If you can believe it, more than 56,000 manufacturing facilities have closed down permanently in the United States since 2001.


We have allowed our economic infrastructure to be absolutely gutted, and so we should not be surprised that our once proud cities are turning into poverty-stricken hellholes.


And this is just the beginning.  The next wave of the economic collapse is rapidly approaching, and when it strikes unemployment in this country will eventually rise to a level that is more than double what it is now.


When that happens, I wouldn’t want to be anywhere near our rotting, decaying cities.


Railroad In Milwaukee



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The Economic Collapse




America The Fallen: 24 Signs That Our Once Proud Cities Are Turning Into Poverty-Stricken Hellholes

Tuesday, April 16, 2013

Detroit takes step to restructure debt despite protests




DETROIT, April 16 | Tue Apr 16, 2013 3:42pm EDT



DETROIT, April 16 (Reuters) – The Detroit City Council on Tuesday approved a controversial contract to restructure the city’s debt, despite a protest that temporarily shut down the meeting.


About 2 dozen protesters opposed to Michigan Governor Rick Snyder’s appointment last month of an emergency manager to run Detroit linked arms and sang protest songs, forcing Council President Charles Pugh to call for a recess that lasted 90 minutes.


The council reconvened after about a dozen police officers moved into the chamber and threatened to arrest anyone who became unruly.


In a 5 to 2 vote, the council approved a six-month, $ 3.4 million contract to hire the Jones Day law firm, the former employer of Emergency Manager Kevyn Orr, to help negotiate agreements with creditors.


Under Michigan law, Orr has the final say on contracts for the cash-strapped city.


Jones Day’s selection as the city’s restructuring counsel was announced by Mayor Dave Bing on March 11, just days before the governor tapped Orr to run Detroit.


Both Orr and Snyder have said talks with creditors were needed to help solve Detroit’s fiscal mess, which mushroomed as the city’s population dropped along with its revenue.


Bill Nowling, Orr’s spokesman, said no meetings with the city’s bondholders have been scheduled.


“We will have more to say about concessions sought when we enter into negotiations,” Nowling said. “Right now, it would be premature to comment.”


Detroit has about $ 2.4 billion of outstanding general obligation debt, $ 6 billion of water and sewer revenue bonds and unfunded liabilities of $ 6 billion for retiree healthcare and $ 650 million for pensions, according to a March report from the mayor’s office.


The city also faces paying as much as $ 440 million, or about 22 percent of its annual operating budget, after a credit rating downgrade last year and more recently the appointment of an emergency manager triggered the termination of interest rate swap agreements.


Nowling said Michigan-based law firm Miller Canfield will continue to negotiate with swap providers.


In the wake of the council meeting, protesters pledged to heighten the intensity of the demonstrations. Since the emergency manager was named, protest threats have mostly not borne out and there has been no violence.


“This is just the beginning. They haven’t see the worst of it,” said Rev. Charles Williams II, the head of the Michigan chapter of the New York-based Rev. Al Sharpton’s National Action Network of community activist. “We are serious about this.”


Among the concerns raised about the contract was perceived conflicts of interest. Protesters said Jones Day’s clients include big banks that are Detroit creditors and stand to lose a lot of money under bankruptcy or a settlement.


Tensions flared late on Tuesday morning when Morris Mays, a 51-year-old Detroiter clad in a black leather jacket, black leather gloves, a black shirt, black sunglasses and gold chains threatened the council.


“I resent you. I hate you for what you did,” Mays told the council for agreeing to work with the emergency manager. “I watch you attack us and attack us and attacks us. And I urge the people of Detroit to attack you!”


Police escorted Mays from the room. Others were forcibly removed after refusing to stay quiet.





Reuters: Bonds News




Detroit takes step to restructure debt despite protests

Saturday, February 23, 2013

Half of Detroit Properties Have Not Paid Taxes; Update on Detroit Bankruptcy

The hollowing out of Detroit is nearly complete. All that’s left is a bankrupt shell of a city with no services and scattered citizens that do not pay taxes.

The Detroit News reports Half of Detroit Property Owners Don’t Pay Taxes

Nearly half of the owners of Detroit’s 305,000 properties failed to pay their tax bills last year, exacerbating a punishing cycle of declining revenues and diminished services for a city in a financial crisis, according to a Detroit News analysis of government records.

The News reviewed more than 200,000 pages of tax documents and found that 47 percent of the city’s taxable parcels are delinquent on their 2011 bills. Some $ 246.5 million in taxes and fees went uncollected, about half of which was due Detroit and the rest to other entities, including Wayne County, Detroit Public Schools and the library.

Delinquency is so pervasive that 77 blocks had only one owner who paid taxes last year, The News found. Many of those who don’t pay question why they should in a city that struggles to light its streets or keep police on them.

“Why pay taxes?” asked Fred Phillips, who owes more than $ 2,600 on his home on an east-side block where five owners paid 2011 taxes. “Why should I send them taxes when they aren’t supplying services? It is sickening. … Every time I see the tax bill come, I think about the times we called and nobody came.”

Update on Detroit Bankruptcy

Detroit is financially and morally bankrupt yet the governor refuses to make that declaration. A Review team says Detroit faces financial crisis, has no plan to fix it so why won’t the governor act?

For the second time in a year, a state review team has found Detroit is in a financial emergency that requires Gov. Rick Snyder to intervene in City Hall.

But this time, if Snyder agrees that a financial emergency exists, the governor’s choices are more limited. He could appoint an emergency manager to keep Michigan’s largest city from plunging into bankruptcy, experts say, or he could continue state financial supervision through a new consent agreement, which seems a faint possibility.

State Treasurer Andy Dillon ruled out a bankruptcy filing at this time.

The six-member review team unanimously concluded in a report released Tuesday that the city failed to restructure its debt-laden bureaucracy under the financial consent agreement signed in April and that Detroit’s financial crisis requires Snyder’s intervention “because no satisfactory plan exists to resolve a serious financial problem.”

Chapter 9 bankruptcy is “always a possibility but I don’t think the city should go through (Chapter) 9 to cure its ailments,” he added.

The review team said the city’s charter adds “numerous restrictions” and hurdles for closing departments, canceling contracts and the type of wholesale restructuring financial experts say is necessary to make city government live within its means.

Restrictions? Who Cares?

In bankruptcy, restrictions go out the window. So do union contracts and pensions. Since all of that needs to go out the window, what’s holding the governor back?

Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com

Mish’s Global Economic Trend Analysis


Half of Detroit Properties Have Not Paid Taxes; Update on Detroit Bankruptcy

Tuesday, February 19, 2013

UPDATE 1-Report to call for Detroit emergency manager -city official

Tue Feb 19, 2013 2:43pm EST

DETROIT Feb 19 (Reuters) – A review team appointed by Michigan Governor Rick Snyder to scour Detroit’s finances will recommend the appointment of an emergency financial manager, City Council President Charles Pugh said on Tuesday.

“They are recommending an emergency manager. That’s what Andy Dillon said,” Pugh said, referring to Michigan’s treasurer, who is a member of the review team. Pugh spoke to city council members during a meeting.

The review team is scheduled to announce its recommendations at a press conference later on Tuesday in Detroit.

Snyder assembled the six-member team in December after slow progress on restructuring Detroit’s sagging finances and operations under an April 2012 consent agreement between the city and Michigan.

No other American city in recent decades has faced a decline in population as steep as Detroit’s. Once the fifth largest U.S. city that shined as the birthplace of the U.S. automotive industry and Motown music, it now ranks 18th with about 700,000 people. With the exodus of residents and jobs, the city has suffered from declining tax revenue and rising crime while saddled with the infrastructure and labor costs of a bygone era.


Reuters: Bonds News


UPDATE 1-Report to call for Detroit emergency manager -city official