Detroit has been run by one political party for over fifty years. The Mayor, City Council and all other offices have been controlled by Democrats. Without a loyal opposition to keep the majority in check, the Democrats have been free to put in place all the social policies and taxes that have driven capital from the city. As the capital flight has occurred, the city raised taxes on those that remained so make up the shortfall.
The real problem is the influence organized labor has had on government. Since most of the political contests take place during the primaries, money from the unions determined the winners. Labor would support politicians that promised labor more jobs, higher wages and better benefits. Election after election, labor bought the winners. And each time the winners supported the unions.
Now Detroit is bankrupt. There is no money to pay the bills. There is no money to pay the workforce. There is no money to pay the benefits. There is no one left to tax. All the major corporations have left. Manufacturing had been driven away years ago.
Detroit filed Chapter 9 bankruptcy. Under this statute, labor is not excluded from being listed with all other creditors. As the court works through all the debts and assets, labor will get the same percentage payout as the rest of the creditors. So, if the debts are settled 60 cents on the dollar, labor benefits will see a pretty big hit.
I have always held the position that the retirement benefits given to a retiring employee should not be tampered with. The employee retired in good faith. Before making the decision to retire, the retirement benefits are studies and used by the retiring employee to make the decision to retire. But the bottom line is this: THERE IS NO MONEY TO PAY THE DEBTS, PERIOD. The only chance Detroit has is to wipe the slate clean and give them a new start. If the stupid politicians go back to business as usual, then the city deserves what it will get.