l****z
发帖数: 29846 | 1 By John Fund
January 31, 2013 12:00 P.M.
Some major American cities are dying, and the worst part is that these
grievously ill patients often are refusing to take even the mildest medicine
that would make things better.
Take Detroit, a city that has become a synonym for urban failure. The murder
rate of one per 1,719 people last year was more than eleven times the rate
in New York City. One contributing factor may be that two-thirds of Detroit
’s streetlights are broken.
Once the fourth-largest city in the country, Detroit’s population has
dropped by almost 30 percent since 2000 to below 700,000. Its vacant lots
cover more land than the entire city of Paris. Despite enormous subsidies
from the state government, Detroit is likely to finish the next fiscal year
in June a full $50 million in the red. An audit could result in a state
takeover of Detroit’s finances, and that could in turn lead to the nation’
s largest-ever municipal bankruptcy.
With conditions so dire, you’d think the city would grab any life preserver
tossed to it. Last year, the state of Michigan offered to take over
management of Belle Isle, the 1.5-square-mile island park that sits in the
Detroit River, just inside the U.S. border with Canada. Now sadly neglected
and crumbling, Belle Isle was once an urban jewel designed by Frederick Law
Olmsted, one of the creators of New York’s Central Park.
The state offered to manage it as part of a ten-year lease that could be
renewed only if both parties agreed. Access to the park, which is connected
to Detroit by a bridge, would be controlled by charging $11 for an annual
vehicle pass that would also cover admission to every other state-operated
park. The state would pump in dollars to repair and upgrade the island’s
facilities, saving the city at least $6 million a year in upkeep.
Sounds like a win-win idea, but Detroit’s city council nixed it at a
tumultuous meeting on Tuesday night. The council voted 6 to 3 to not even
put the proposal on its agenda. Governor Rick Snyder’s office then promptly
withdrew the offer because a key deadline for the state’s budget wouldn’t
be met.
Opponents who showed up at the meeting angrily denounced the proposal as
akin to selling the island to outsiders. “The governor has his hands on our
jewels,” one skeptic told the council.
Some council members seemed to be living in an alternate reality in which
Belle Isle wasn’t in dire need of help. Council president Charles Pugh said
he would be happy to have the state “beautify Belle Isle, but not the
state as the one running it.” His council colleague, JoAnn Watson, said she
was holding out hope for a federal or state bailout of the city’s finances
. Council member Kenneth Cockrel Jr. insisted that “there are far more
pressing issues than this that we ought to be dealing with.” But the
council has consistently rejected sensible proposals to contract out its bus
system and garbage collection or to sell its electric system to an investor
-owned utility.
Henry Payne, a writer for the Detroit News, says the tenor of the council
meeting depressed him. “It was a throwback to old conspiracy theories that
have long prevented progress in Detroit,” he told me. “Several speakers
raved on about the Belle Isle deal being a suburban plot to take over
Detroit.”
Not all city leaders agreed with such views. Mayor Dave Bing said in a
written statement that he is “extremely disappointed” with the council’s
decision: “I believe the majority of Detroiters supported this lease
agreement. City Council’s actions today will force us to look at making
additional cutbacks that may negatively impact the City’s other parks.”
Dan Gilbert, the owner of Quicken Loans, which is headquartered in Detroit,
could only scratch his head. “[The deal is] light years better. What is so
hard?” he asked in a Tweet.
There are many explanations, but a common one is that Detroit has a
reactionary political class that views almost any proposed change as
smacking of “union busting” or “selling off the city” to white interests
. Unions have sued to block Mayor Bing’s labor reforms, even though the
city’s public-pension system is $11 billion in the red. Some city workers
now retired and in their 80s have been drawing retirement benefits since
they left the city’s employment in their 40s. Budget controls are
incredibly lax. This month, it was discovered that Barrett Jones, a full-
time consultant for the Detroit Water and Sewage facility earning $139,000 a
year, had a second full-time job at $135,000 a year as public-safety
administrator for the city of Flint, which is 70 miles away. He has resigned
from his Flint job but still works for the city of Detroit.
Despite clear evidence that the city council isn’t interested in viable
solutions to Detroit’s finances, pie-in-the-sky talk is still rampant among
its members. Council member Kwame Kenyatta claimed at this week’s council
meeting: “There are other activities that you can have on Belle Isle that
will generate revenue and create jobs.” One potential investor who has come
forward with an intriguing proposal has seen it roundly dismissed by city
officials. Rod Lockwood, a real-estate developer and former president of the
Michigan Housing Council, has published a bold plan to revitalize Belle
Isle by having the city sell it for $1 billion to investors who “believe in
individual freedom, liberty, and free markets.”
The investors would be given freedom to set up an “enterprise zone,” which
would have self-governing commonwealth status with the U.S. much as Puerto
Rico and the Northern Mariana Islands have. The new Belle Isle would have a
top rate of 10 percent on income taxes, and no taxes on capital gains,
dividends, investments, or estates. Lockwood predicts the island would be
attractive to finance, insurance, and investment companies, and no factories
would be permitted. Former Chrysler president Hal Sperlich, who has
endorsed the idea, says the economic dynamism the area would generate could
turn it into a “Midwest Tiger” with spillover benefits for Detroit as a
whole.
Of course, Belle Isle isn’t going to become an “enterprise zone,” given
that Detroit’s leaders can’t even bear the thought of having the state
government manage it for free. Out-of-the-box ideas like Lockwood’s are
dead on arrival. So Detroit appears doomed to continue to sink until
something radical is done. The most likely course is bankruptcy, which would
void the city’s contracts with its 18 municipal-employee unions.
“I think . . . off and on, that [bankruptcy] wouldn’t be a bad idea,”
former Ford chief financial officer Allan Gilmour, now the president of
Detroit’s Wayne State University, told Reuters this month. “Let’s clean
this out once and for all.”
Other failing American cities have a chance to rescue themselves before
things get that bad. But if present trends continue, dozens of American
cities will find themselves on the bankruptcy operating table if they
continue to reject effective fiscal medicine.
— John Fund is national-affairs columnist for NRO. |
|
