Detroit's Going Down

Read here for an excellent summary of the nothing-but-bad news about Detroit's financial situation. The entire article is worth a read but here's a line that stuck out: "The value of the city’s net assets, which in 2010 were worth $265 million, has collapsed and they now have a negative value." I suspect many of the now-vanished 2010 assets were cash and its equivalents, which suggests that the city has cleaned the cupboard for its employees. Now, of course, it's the retirees among others who will be left holding the bag. But don't expect any of Detroit's current employees or professional agitators to agree: "Protests broke out. Jesse Jackson flew in to join a coalition of pastors, civil-rights leaders and local officials condemning the alleged assault on the city’s democratic rights. 'We are prepared to go from education, mobilization, litigation, legislation, demonstration and civil disobedience,' Jackson said."

Given Michigan's passage of a right-to-work amendment to its constitution, the Rev. Jackson would do more for the city were he to bring bags of money. Even were the state inclined to bail out its largest city, there's no way it could afford to do so. State-level insolvency would certainly ensue if it were to pick up the tab for Detroit's overgenerous promises to public sector employees. And without the ability of a State to seek bankruptcy protection (see here), it only makes sense to permit Detroit to seek its own painful bankruptcy relief.