Late in March TEK reported on the sorry state of the city of Detroit in the USA. It was reaching its own fiscal cliff and looked set to end up bankrupt. In May the latest news was that bankruptcy was days away and Friday news is in that Detroit has filed for bankruptcy.
BBC News reports:
"The US city of Detroit in Michigan has become the largest American city ever to file for bankruptcy, with debts of at least $15bn (£10bn). State-appointed emergency manager Kevyn Orr asked a federal judge to place the city into bankruptcy protection."
As a once great symbol of US industrial power it is perhaps ironic that Detroit is now one city with huge financial problems, crumbling buildings and high unemployment. A reflection showing the real picture of the USA perhaps?.
The US shows a front of business as usual but as Detroit shows it too, like Europe, is facing an economic crisis. The money spent in the USA on politics, spin, elections, propaganda, conflicts in Afghanistan and Iraq, and more gives an impression of prosperity, but like many other western countries, it waves a false flag. There is still wealth in the USA, but now there are less people feeling any benefit.
Detroit has debts of at least $18bn or £12bn. The city is trying to get protection from creditors which include public sector workers and their pension funds. Imagine you have towed the line, worked all your life, paid into a public sector pension plan, only to find as your twilight years approach it was all for nothing.
Unions representing workers in Detroit claim the bankruptcy is nothing more than a power grab. Certainly the city has endured decades of falling standards and increased financial problems. According to the BBC around 70,000 are abandoned adding to the crumbling facade of this once great automotive city. As public services reach breaking point the worst is no doubt still to come.
Detroit update, insolvency days away