Saturday, July 20, 2013

Detroit's Fall

In Fortune, Dora Levin on Detroit's bankruptcy. An excerpt:

Detroit, meanwhile, stumbled over a period of decades into irreversible insolvency because its elected officials dithered and dissembled and argued, instead of undertaking tough measures to close fiscal gaps. In truth, the city's financial liabilities were created by the very people who should have been resolving them: One administration after another promised wages, job guarantees, and pensions to city workers that were simply unsustainable.
Why did elected officials make those promises? Probably because they never feared being held accountable. Many of them, dead or retired, will have been correct.

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