Lurking in the Shadows

I left off posting about Chapter 9 municipal bankruptcy with a warning here that deep structural reasons account for the phenomenon of "debt-overhang" that dooms many American cities to an upcoming stay in financial purgatory. (And their immobile taxpayer-citizens to years of municipal hell.)

You can read a short post about "debt-overhang" here.

So what's new? Well, nothing really, except that my warnings here and here about the parlous situation of the City of Chicago have been clarified and amplified by a Windy City insider. You can go here to read "Dichotomy, Demographic Transformation, Urban Renaissance & Bankruptcy" published in the well-respected Data Analytics Illinois.

This is not drive-by shooting. It is a painstaking account of where Chicago stands. In short,

As the state’s economic engine, Chicago’s pension problems demand a fix beyond short term strategies that compound the longer-term problem. After decades of corruption and mismanagement, officials cannot tax or borrow their way out of the fiscal crisis.

But, unlike much of what we read on the internet, this conclusion is supported by careful analysis and posits a solution. The solution is too long and carefully laid out to summarize in this post so I commend the entire piece to the attention of my readers, especially those who live in Illinois. (Of course, there are other American cities in a similar boat that don't have the potential of Chicago to work their way out of it so beware if you live in a number of cities in California and Connecticut.)