One way to view Detroit’s bankruptcy — the largest bankruptcy of any American city — is as a failure of political negotiations over how financial sacrifices should be divided among the city’s creditors, city workers and municipal retirees — requiring a court to decide instead. It could also be seen as the inevitable culmination of decades of union agreements offering unaffordable pension and health benefits to city workers.
But there’s a more basic story here and it’s being replicated across America: Americans are segregating by income more than ever before. Forty years ago, most cities (including Detroit) had a mixture of wealthy, middle-class and poor residents. Now, each income group tends to lives separately, in its own city — with its own tax bases and philanthropies that support, at one extreme, excellent schools, resplendent parks, rapid-response security, efficient transportation and other first-rate services; or, at the opposite extreme, terrible schools, dilapidated parks, high crime and third-rate services.
As more American cities sink into the quicksand of bankruptcy, a veritable Scapegoats’ Olympics has been inaugurated – crowd-pleasing blame games that usually point fingers at workers. Harold Meyerson was having none of it the other day, however, in an L.A. Times op-ed:
“From reading the voluminous accounts of the fiscal woes of Stockton and San Bernardino, you’d think that municipal unions and feckless city officials are primarily what led these cities down the path to fiscal ruin.”
For evidence, Meyerson quotes editorials and columns appearing in the O.C. Register and Sacramento Bee, both of which confidently laid the blame on the pensions of unionized public employees. Of course, the unchallenged narrative among the chattering classes has been all about spineless city governments caving in to unions whose greedy members expect to enjoy a paid retirement when they’re too old to work.