In my native Detroit, Atlas finally shrugged

Dr. Mark W. Hendrickson's picture

[Editor’s note: This opinion editorial first appeared at Forbes.com.]

I’m sad. Detroit is my native city. It’s decline from being arguably the world’s richest city to being America’s “first Third Word city” is tragic, politically criminal, and a warning to other Americans.

The official declaration of Detroit’s bankruptcy last week could not have come as a surprise to anyone familiar with the Motor City’s atrocious financial condition.

The city had no hope of ever recovering from its colossal over-indebtedness, and without a central bank standing by to create fiat credit to augment its insufficient revenue — the scheme that is the only thing keeping the even more colossally over-indebted national government solvent — the only question was when someone would pull the plug.

Fiscally speaking, Detroit had been in the “walking dead” category for years. The July 18 announcement by Detroit’s emergency manager, Kevyn Orr, finally acknowledged the inescapable facts.

Clearly, some Michiganders are still in denial and refuse to face those facts. On July 19, Ingham County Circuit Judge Rosemarie Aquilina insisted that the Chapter 9 bankruptcy declaration be withdrawn, stating the Michigan constitution forbids any action that would decrease the pension benefits of public employees.

In the first place, Judge Aquilina should read my article about will and abandon the delusion that a constitution can alter reality by making nonexistent funds magically appear.

In the second, it is an unjust constitution that confers a protection on public employees that private-sector employees don’t have.

A sounder constitution would have prohibited the city government from gaining control of employees’ retirement funds contributions and instead have mandated that those contributions all go into a private fund in the workers’ names where the city couldn’t touch them.

The ideology that causes Judge Aquilina to believe that political action — policies, laws, even constitutions — can make reality conform to one’s political vision is the very ideology that already has devastated Detroit.

Politicians believed that they could create a “fairer” city by raising taxes on businesses and productive individuals and redistributing wealth to favored political constituencies, particularly the public sector unions. In doing so, they killed the goose that laid the golden egg.

The more aggressive the policies to take the wealth of the productive (including imposing an additional tax on those who worked in Detroit but lived outside the city limits), the more people and businesses left the city to avoid the city government’s predations.

This is the social and political pathology that Ayn Rand portrayed so vividly in “Atlas Shrugged.” One of her novel’s central themes was that when a society, instead of respecting (and perhaps even being grateful for) those who produce the wealth that sustains and enriches our lives, treats society’s economic benefactors as enemies to be plundered, a society embarks on a destructive path that, if unchecked, leads to doom.

So, what happens now? It’s hard to feel sympathy for any of the vultures who are squabbling over Detroit’s carcass. Municipal bondholders certainly don’t merit sympathy for the huge losses they will incur. Anyone who invested in the debt promises of such a corrupt and poorly managed city deserves to lose money.

They would have had to be blind not to see how broke the city was, so it seems that they made a cold, cynical, calculated bet on Detroit’s predatory government continuing to be able to find victims from whom to extract more money.

While acknowledging that there are dedicated policemen and teachers in Detroit who labor under difficult conditions, it is still hard to justify economically the generous pension promises they have received when the average response time to a 9-1-1 call is 58 minutes and educational results have been so abysmal.

Just as individuals sometimes resolve to change their ways so that someone who has departed has not died in vain, the demise of Detroit may not be in vain if we learn its grim lesson and reform city, state, and the federal government from their destructive predatory policies. Atlas has shrugged in Detroit.

You had better restrain government so that Atlas doesn’t shrug where you live.

[Dr. Mark W. Hendrickson is an adjunct faculty member, economist, and fellow for economic and social policy with The Center for Vision & Values (www.VisionAndValues.org) at Grove City (Penn.) College.] © 2013 by The Center for Vision & Values at Grove City College.

Joe Kawfi
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Lessons from Detroit

For 15 years, from the mid 1970's to 1990, Detroit descended into the abyss of crime, debauchery, gun play, drugs, school truancy, car-jacking, gangs and human depravity. Entire city blocks burned out. Grafitti exploded on buildings, cars, trucks, buses and school yards. Trash everywhere!

Detroiters walked through it, tossed more into it, and ignored it. Tens of thousands, and then hundreds of thousands today exist
on federal welfare, free housing, and food stamps.

With Aid to Dependent Children, colored women birthed eight to 10, and in one case, one woman birthed 24 children as reported by the Detroit Free Press, all on American taxpayer dollars.

A new child meant a new car payment, new TV, and whatever the skeezer wanted. Lyndon Johnson's 'Great Society' flourished in Detroit . If you give money for doing nothing, you will get more hands out taking money for doing nothing.

Mayor Coleman Young, perhaps the most corrupt mayor in America rode Detroit down to its knees... He set the benchmark for cronyism,incompetence, and arrogance. As a colored man, he said, "I am the MFIC." The IC meant "in charge".

You can figure out the rest.

Detroit became a majority black city with 67 percent colored people.
A United Van Lines truck driver noted that he loaded hundreds of American families into vans for a new lives in another cities or states.

Detroit plummeted from 1.8 million citizens to 912,000 today. At the same time, legal and illegal immigrants converged on the city for the free government handouts, so much so, that Muslims number over 300,000. Mexicans number 400,000 throughout Michigan, but most work in Detroit. As the Euro-Americans moved out, the Muslims moved in.

As the crimes became more violent, the whites fled. Finally, unlawful Mexicans moved in at a torrid pace. Detroit suffers so much shoplifting that grocery stores no longer operate in many inner city locations. You could cut the racial tension in the air with a knife! Detroit may be one of te best examples of multiculturalism: pure dislike, and total separation from America ..

Today, you hear Muslim calls to worship over the city like a new American Baghdad with hundreds of Islamic mosques in Michigan , paid for by Saudi Arabian oil money. High school flunk-out rates reached 76 percent last June, according to NBC's Brian Williams. Classrooms resemble more foreign countries than America .. English? Few speak it! The city features a 50 percent illiteracy rate and growing.

Unemployment hit 28.9 percent in 2009 (thanks obama) as the auto industry vacated the city. From Time Magazine on October 4, 2009: "The Tragedy of Detroit : How a great city fell, and how it can rise again," "If Detroit had been ravaged by a hurricane, and submerged by a ravenous flood, we'd know a lot more about it," said Daniel Okrent. "If drought and carelessness had spread brush fires across the city, we'd see it on the
evening news every night." Earthquake, tornadoes, you name it, if natural disaster had devastated the city that was once the living proof of American prosperity, the rest of the country might take notice.

But Detroit , once our fourth largest city, now 11th and slipping rapidly, has had no such luck. Its disaster has long been a slow unwinding that seemed to remove it from the rest of the country.

Even the death rattle that in the past year emanated from its signature industry brought more attention to the auto executives than to the people of the city, who had for so long been victimized by their dreadful decision making."

As Coleman Young's corruption brought the city to its knees, no amount of federal dollars could save the incredible payoffs, kickbacks and illegality permeating his administration.

"By any quantifiable standard, the city is on life support. Detroit 's treasury is $300 million short of the funds needed
to provide the barest municipal services," Okrent said.

"The school system, which six years ago was compelled by the teachers' union to reject a philanthropist's offer of $200 million to build 15 small, independent charter high schools, is in receivership. The murder rate is soaring, and 7 out of 10 remain unsolved. Three years after Katrina devastated New Orleans , unemployment in that city hit a peak of 11%. In Detroit today, the unemployment rate is 28.9%. That's worth spelling out: twenty-eight point nine percent.

At the end of Okrent's report, and he will write a dozen more about Detroit, he said, "That's because the story of Detroit is not simply one
of a great city's collapse, it's also about the erosion of the industries that helped build the country we know today. The ultimate fate of Detroit will reveal much about the character of America in the 21st century.

If what was once the most prosperous manufacturing city in the nation has been brought to its knees, what does that say about our recent past? And if it can't find a way to get up, what does that say about America's future?"

The auto industry won't come back. Immigration will keep pouring more and more uneducated third world immigrants from the Middle East into Detroit , thus creating a beachhead for Islamic hegemony in America . If 50 percent illiteracy continues, we will see more home-grown terrorists spawned out of the Muslim ghettos of Detroit . Illiteracy plus Islam equals
walking human bombs.

You have already seen it in Madrid , Spain , London , England , and Paris , France with train bombings,subway bombings and riots. As their numbers grow, so will their power to enact their barbaric Sharia Law
that negates republican forms of government, first amendment rights, and subjugates women to the lowest rungs on the human ladder. We will see more honor killings by upset husbands, fathers and brothers that demand subjugation by their daughters, sisters and wives. Muslims prefer beheading of women to scare the hell out of any other members of their sect from straying.

Multiculturalism: what a perfect method to kill our language, culture, country and way of life.

stranger than f...
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Congratulations Joe!

Although I don't agree with all of your conclusions, you have taken the time to make a coherent argument for your position instead of merely blaming the President. Thank you for a thoughtful posting.

SPQR
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STF

It would be very interesting to read your rebuttal of Joe's more than outstanding piece on Detroit.