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Detroit Files Largest Municipal Bankruptcy In History

Detroit

Late today, the City of Detroit filed the largest bankruptcy by a municipality in American history:

DETROIT — Detroit, the cradle of America’s automobile industry and once the nation’s fourth-most-populous city, has filed for bankruptcy, an official said Thursday afternoon, the largest American city ever to take such a course.

The decision to turn to the federal courts, which required approval from both the emergency manager assigned to oversee the troubled city and from Gov. Rick Snyder, is also the largest municipal bankruptcy filing in American history in terms of debt.

Not everyone agrees how much Detroit owes, but Kevyn D. Orr, the emergency manager who was appointed by Mr. Snyder to resolve the city’s financial problems, has said the debt is likely to be $18 billion and perhaps as much as $20 billion.

For Detroit, the filing comes as a painful reminder of a city’s rise and fall.

Founded more than 300 years ago, the city expanded at a stunning rate in the first half of the 20th century with the arrival of the automobile industry, and then shrank away in recent decades at a similarly remarkable pace. A city of 1.8 million in 1950, it is now home to 700,000 people, as well as to tens of thousands of abandoned buildings, vacant lots and unlit streets.

From here, there is no road map for Detroit’s recovery, not least of all because municipal bankruptcies are rare. Some bankruptcy experts and city leaders bemoaned the likely fallout from the filing, including the stigma it would carry. They anticipate further benefit cuts for city workers and retirees, more reductions in services for residents, and a detrimental effect on future borrowing.

But others, including some Detroit business leaders who have seen a rise in private investment downtown despite the city’s larger struggles, said bankruptcy seemed the only choice left — and one that might finally lead to a desperately needed overhaul of city services and a plan to pay off some reduced version of the overwhelming debts. In short, a new start.

The decision to go to court signaled a breakdown after weeks of tense negotiations, in which Mr. Orr had been trying to persuade creditors to accept pennies on the dollar and unions to accept cuts in benefits.

All along, the state’s involvement — including Mr. Snyder’s decision to send in an emergency manager — has carried racial implications, setting off a wave of concerns for some in Detroit that the mostly-white, Republican-led state government was trying to seize control of Detroit, a Democratic-held city where more than 80 percent of residents are black.

The nature of Detroit’s situation ensures that it will be watched intensely by the municipal bond market, by public sector unions, and by leaders of other financially challenged cities around the country. Only slightly more than 60 cities, towns, villages and counties have filed under Chapter 9, the court proceeding used by municipalities, since the mid-1950s.

The debt in Detroit dwarfs that of Jefferson County, Ala., which had been the nation’s largest municipal bankruptcy, having filed in 2011 with about $4 billion in debt. The population of Detroit, the largest city in Michigan, is more than twice that of Stockton, Calif., which filed for bankruptcy in 2012 and had been the nation’s most populous city to do so.

Other major cities, including New York and Cleveland in the 1970s and Philadelphia two decades later, have teetered near the edge of financial ruin, but ultimately found solutions other than federal court. Detroit’s struggle, experts say, is particularly dire because it is not limited to a single event or one failed financial deal, like the troubled sewer system largely responsible for Jefferson County’s downfall.

Instead, numerous factors over many years have brought Detroit to this point, including a shrunken tax base but still a huge, 139-square-mile city to maintain; overwhelming health care and pension costs; repeated efforts to manage mounting debts with still more borrowing; annual deficits in the city’s operating budget since 2008; and city services crippled by aged computer systems, poor record-keeping and widespread dysfunction.

All of that makes bankruptcy — a process that could take months, if not years, and is itself expected to be costly — particularly complex.

“It’s not enough to say, let’s reduce debt,” said James E. Spiotto, an expert in municipal bankruptcy at the law firm of Chapman and Cutler in Chicago. “At the end of the day, you need a real recovery plan. Otherwise you’re just going to repeat the whole thing over again.”

The municipal bond market will be paying particular attention to Detroit because of what it may mean for investing in general obligation bonds. In recent weeks, as Detroit officials have proposed paying off small fractions of what the city owes, they have indicated they intend to treat investors holding general obligation bonds as equal, in essence, to city workers — a notion that conflicts with the conventions of the market, where general obligation bonds have been seen as among the safest investments.

Leaders of public sector unions and municipal retirees around the nation will be focused on whether Detroit is permitted to slash pension benefits, despite a provision in the State Constitution that union leaders say bars such cuts.

Officials in other financially troubled cities may feel encouraged to follow Detroit’s path, some experts say. A rush of municipal bankruptcies appears unlikely, though, and leaders of other cities will want to see how this case turns out, particularly when it comes to pension and retiree health care costs, said Karol K. Denniston, a bankruptcy lawyer with Schiff Hardin who is advising a taxpayer group that came together in Stockton after its bankruptcy.

“If you end up with precedent that allows the restructuring of retirement benefits in bankruptcy court, that will make it an attractive option for cities,” Ms. Denniston said. “Detroit is going to be a huge test kitchen.”

Brad Plumer lays out some of the reasons Detroit got where it is today:

— Since 2000, Detroit’s population has declined 26 percent. There are now just 700,000 people in the city, way down from 2 million during its industrial heyday in 1950.

— The official unemployment is now 18.6 percent, and fewer than half of the city’s residents over the age of 16 are working. Per capita income is an extremely low $15,261 a year, which means there’s not all that much tax revenue pouring in.

— Low tax revenue, in turn, means that city services are suffering. Detroit has the highest crime rate of any major city, and fewer than 10 percent of crimes get solved. The average response time for an emergency call is 58 minutes. Some 78,000 buildings are abandoned or blighted and there are an estimated 12,000 fires every year. About 40 percent of the city’s streetlights don’t work.

— High crime and blight are driving even more residents out of the city. It’s also driving down property values, which means many residents have stopped paying property taxes. The city collected about 68 percent of the property taxes owed in 2011. Both of those things put a further strain on Detroit’s finances.

— Detroit is sagging under decades of bad governance. ”The city’s operations have become dysfunctional and wasteful after years of budgetary restrictions, mismanagement, crippling operational practices and, in some cases, indifference or corruption,” Orr wrote in May. “Outdated policies, work practices, procedures and systems must be improved consistent with best practices of 21st-century government.” (For the record, Detroit has been a one-party city run continuously by Democrats since 1962.)

— Meanwhile, Detroit owes around $18.5 billion to its creditors. That includes about $6 billion in health-care and life insurance obligations, plus billions more in pension costs racked up over the years. Given its ever-worsening economic slide, Detroit was in no position to pay off all its obligations.

As Plumer notes, Kevin Orr, the financial manager that Governor Snyder appointed to manger the city’s finances last year has spent much of his time in office trying to negotiate deals with those creditors, and with the public employee unions and pension funds that constitute such a huge part of the city’s financial load but those negotiations have been unsuccessful. Perhaps that lack of success was due to the fact that creditors didn’t actually think that Orr and Snyder would actually pull the trigger and file for Bankruptcy protection, but that’s not entirely clear. In any event, the matter will not go before a Bankruptcy Court Judge who, assuming he accepts the filing as required under the rules that govern a Chapter 9 petition, will manage perhaps one of the most complex cases that has ever been in a U.S. Bankruptcy Court and, no doubt, one that is likely to be watched by other struggling cites across the country. As noted above, if Detroit is able to successfully renegotiate its obligations under Chapter 9, then the odds are fairly high that we’ll see other cities make the same attempt. It won’t be pretty, but it may be what’s best to save cities that never really managed to find a way to reorient themselves as the American economy has reoriented itself from the industrial economy that they came to rely upon.

Here’s the initial petition filed by the City of Detroit:

Detroit Chapter 9 Bankruptcy Petition by dmataconis

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About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May, 2010 and also writes at Below The Beltway. Follow Doug on Twitter | Facebook

Comments

  1. Paul L. says:

    President Obama: “When Gov. Romney said we should just let Detroit go bankrupt, we said thanks but no thanks.”

    Poorly-rated. Helpful or Unhelpful: Thumb up 12 Thumb down 28

  2. Scott says:

    Regardless of how the finances play out, the real challenge is how to devolve a city. I don’t think it has ever been done. Usually, as cities grow the municipal and political structures merge and consolidate. Should a city like Detroit now do just the opposite: break up into smaller, independent governing units? Just a thought, but I have no idea.

    Highly-rated. Helpful or Unhelpful: Thumb up 17 Thumb down 0

  3. bill says:

    @Paul L.: good one, even though it was regarding the auto big wigs/unions it is a great soundbite now! if there was a republican in the white house and he made that statement in the same context it would be all over the news and on the front page of the nyt,etc.
    too bad for detroit though, there’s nobody to blame but themselves for voting for who they voted for. and of course they have to have a republican gov. make the inevitable call so they can blame him for it.

    Hot debate. What do you think? Thumb up 11 Thumb down 24

  4. James Pearce says:

    @bill:

    too bad for detroit though, there’s nobody to blame but themselves for voting for who they voted for

    Nice try, Bill. There are other cities who have also been run by Democrats for decades. It takes more than that.

    Highly-rated. Helpful or Unhelpful: Thumb up 25 Thumb down 8

  5. Dave Schuler says:

    It’s a terrible tragedy.

    One thing I notice is missing from Brad’s list: Detroit was, in essence, a very large “company town”. When the company, the auto industry, abandoned it, for whatever reason, it left the city in terrible straits.

    Other American cities have lost larger proportions of their population but none is in the terrible condition that Detroit is. It’s been mentioned before here but we’re in desperate need of an orderly procedure for decommissioning a city. It’s not something the city will do on its own.

    It’s something the state must do and in honesty Michigan must bear some of the blame for the condition Detroit’s in. The state should have stepped in long, long ago.

    Highly-rated. Helpful or Unhelpful: Thumb up 24 Thumb down 0

  6. edmondo says:

    I wonder how long it will be before someone suggests “bailing out” Detroit?

    http://www.bondbuyer.com/issues/118_237/-1004947-1.html

    Like or Dislike: Thumb up 3 Thumb down 2

  7. Tyrell says:

    New technology, research, and industries need to be attracted. To do that the entire culture must change. Get rid of the dated “Motown” image. Get the gangs out, no gangs allowed in Detroit. Communities need to get together and organize; clean up the neighborhoods and fix things up. Tear down abandoned houses and buildings. Have more patrols – cut down the crime. Reform the school system. Remake it into the cleanest and safest city in the country. Then new industry and business will come in.

    Like or Dislike: Thumb up 2 Thumb down 5

  8. Jenos Idanian says:

    @Tyrell: As others have noted, they’re remaking “Robocop.” Could all this be a big PR stunt?

    Your proposal has merit, but carrying out has its challenges. What you propose requires several things that are in scarce supply. A government willing to act responsibly, a heavily involved citizenry, a general sense of self-sacrifice, and — most of all — a lot of money.

    Who’s going to supply that money? We’re talking about either philanthropy or long-term investment. Philanthropy is bad here, as it simply offers a short-term fix, with only a possibility of long-term good. Investors, however, tend to be interested in getting a return, and unless Detroit first demonstrates that it is ready and willing to make the kinds of changes you talk about — and demonstrates it in very tangible ways — there’s just no good reason to throw even more money at the city.

    Like or Dislike: Thumb up 2 Thumb down 2

  9. Rick DeMent says:

    The fortunes of Detroit, or rather lack thereof, can be traced to two major issues, a complete lack of any kind of mass transit (due to the influence of the car companies), and the total reliance on one industry (again the car companies). Maybe it’s just one problem really, the car companies. It’s all fun and games when an industry has 70% of the market share. Other cities have crime, other cities have corruption, Detroit was a victim of it’s own success and they thought the good times would roll on forever.

    Just like the car companies had to wind down their infrastructure (dealerships, supply chain, etc.) in order to compete, the city had to figure out a way to shrink itself to compensate for the fact that there was no transit infrastructure to keep anyone in the city. With the private auto as it’s overwhelming mode of transportation, people could, and did, move anywhere unlike other rust belt cities like Cleveland, Pittsburgh, and Chicago.

    But make no mistake SE Michigan is having to deal with these sprawl issues right now. The winding down of Auburn Hill and Troy is the suffering same problem as Detroit in a microcosm. And those were relatively well run (or as some might read … white) suburbs. The decline of the boom years is leaving surrounding communities in a lurch and there is nothing that will stop the decline until we just stop the sprawl economy.

    Like or Dislike: Thumb up 6 Thumb down 1

  10. bill says:

    @James Pearce: and they aren’t all going bankrupt- good for them. detroit was run into the ground by them and their union cronies-get what you vote for. they don’t need a bailout, they need bulldozers.

    Like or Dislike: Thumb up 5 Thumb down 11

  11. C. Clavin says:

    “…Get the gangs out, no gangs allowed in Detroit. Communities need to get together and organize; clean up the neighborhoods and fix things up. Tear down abandoned houses and buildings. Have more patrols – cut down the crime…”

    Yes indeed…we can call it the Zimmermanization of a city.

    Like or Dislike: Thumb up 9 Thumb down 4

  12. Barry says:

    @Dave Schuler: “One thing I notice is missing from Brad’s list: Detroit was, in essence, a very large “company town”. When the company, the auto industry, abandoned it, for whatever reason, it left the city in terrible straits.”

    And you won’t see that in many pundit’s lists. And you won’t see the fact that racial issues tore the city to h*ll; a large number of white fled to the suburbs, and the electoral power within the state shifted accordingly.

    Like or Dislike: Thumb up 7 Thumb down 0

  13. Gromitt Gunn says:

    I think that it is also important to note that, unlike many of the large non-coastal metro areas, Detroit is basically landlocked, and most of the suburbs were incorporated long before Detroit was “Detroit.”

    As a counterexample, you can look at San Antonio. Almost all of Bexar County, except for a few enclaves, have either been incorporated into the City limits, are subject to San Antonio’s extraterritorial jurisdiction, or are unincorporated but rely on City services. Something like 85% of Bexar County lives within the City. So, when socioeconomic flight happens, those fleeing are still (mostly) part of the City’s tax base. Even if they aren’t, they’re still likely subject to a consolidated utility and public services plan.

    Like or Dislike: Thumb up 5 Thumb down 0

  14. C. Clavin says:

    I’ve been struck, for a long time now, by the contrast of New Orleans and Detroit.

    Today Detroit is a massive opportunity. We are talking office space at $8sf compared to $90 in NYC. And huge corporations are making commitments. Blue Cross, Twitter, Quicken Loans. Chrysler never left in spite of some of the nonsense above. This bankruptcy is an important part of the process.
    What needs to happen is for Detroit to be re-imaged as the next Austin, or Boulder, or whatever.
    It’s going to be a slow process…but it will happen.
    It won’t happen the way Tyrell dreams about. You don’t make the safest city in the world and then people come back…that’s some kind of white man’s wet dream…the tea baggers vision of an America that has never existed.
    Rebuilding Detroit will take people with vision and cojones working hard to rebuild Detroit. It will evolve slowly to whatever it does become. It will be fascinating to watch.

    Like or Dislike: Thumb up 11 Thumb down 2

  15. Barry says:

    BTW, for those unfamiliar with Michigan politics:

    ‘Michissippi’ is now run by a Tea Party-dominated western-Michigan faction. The state has been gerrymandered so that the GOP will control the legislature. They’ve been running in standard Tea Party fashion, namely looting the state while passing every right-wing wet dream law.

    These people look upon the bankruptcy of Detroit as a looting spree. They will not fix it.

    Like or Dislike: Thumb up 10 Thumb down 5

  16. C. Clavin says:

    @ Barry…
    Yes…this Emergency Manager thing strikes me as the most un-Constitutional thing I’ve ever heard of. A Republican invention…no doubt.
    On the other hand this guy Orr, the emergency manager in Detroit, helped Chrysler re-organize…which involved bringing the (very cooperative) unions to the table and trimming fat from the massively bloated executive offices.

    Like or Dislike: Thumb up 1 Thumb down 2

  17. C. Clavin says:

    “…Detroit is basically landlocked…”

    Interesting…considering that the Edmund Fitzgerald was headed for Detroit to unload her cargo of iron ore before docking in Cleveland for the winter.
    Don’t want to bust your balls…but anything for a Gordon Lightfoot reference.

    Like or Dislike: Thumb up 7 Thumb down 1

  18. Dave Schuler says:

    @C. Clavin:

    Michigan’s first Emergency Manager law, Public Law 101, was enacted in 1988 under a Democratic governor (James Blanchard) and legislature. Its present Emergency Manager law, Public Law 436, was enacted under a Republican governor and legislature. I’m not enough of a legal scholar to determine whether Detroit would have fared better under the old law or not.

    States have practically unlimited powers in areas like this. Cities are creatures of the state—they’re incorporated under franchises of the state. With or without Michigan’s EM law, Detroit was in trouble.

    Like or Dislike: Thumb up 8 Thumb down 0

  19. Scott says:

    @Gromitt Gunn: Your point is correct. As a city, Detroit really no longer has a reason to exist. Modern cities have services as an economic base whether it is education, IT, medical, etc. Modern factories requires space and land. They won’t come back to Detroit. Personally, I think the answer is to go counter intuitive and let the city die. The challenge is to do it gracefully and smart. Unfortunately, I think we will find more vultures willing to pick the bones than visionaries.

    Like or Dislike: Thumb up 1 Thumb down 0

  20. C. Clavin says:

    @ Dave…
    My understanding is that Detroit is being run under the old law…and not the tea-stained version.
    There is no doubt in my mind that bankruptcy was both inevitable and a positive step forward for Detroit.

    Like or Dislike: Thumb up 1 Thumb down 1

  21. C. Clavin says:

    “…Unfortunately, I think we will find more vultures willing to pick the bones than visionaries…”
    Well that’sthe real world now, isn’t it?

    Even bald eagles dine on road-kill.
    But this country wouldn’t be this country if it wasn’t for a few visionaries pursuing what the vultures thought to be a fools errand.

    Like or Dislike: Thumb up 0 Thumb down 1

  22. Gromitt Gunn says:

    @C. Clavin: I meant that it doesn’t have capacity to increase its incorporated area through annexation – but, yes, poor choice of words.

    Like or Dislike: Thumb up 1 Thumb down 0

  23. Mikey says:

    @C. Clavin: I thought the original EFM law was superseded by the current one? But maybe not, I don’t know. I haven’t been keeping very close track since I moved away from the Detroit area in 2003.

    The one thing I always think of when I think of Detroit is “wasted potential.” It could be so much more than it’s become. It sits on the border with America’s largest trading partner, it is a port on the St. Lawrence Seaway (which means access to Atlantic shipping lanes), Michigan is a great state for nature and outdoor activity, there are some pretty nice suburbs…there’s so much that could have been done.

    Kevyn Orr helped save Chrysler, can he now save Detroit? I hope so, I really do.

    Like or Dislike: Thumb up 2 Thumb down 0

  24. stonetools says:

    Wow, when AIG and the rest of the financial industry was going bankrupt, Republicans fell over themselves dumping 780 BILLION dollars into the financial industry’s coffers and told us that saving the banking system was crucial-so crucial that we couldn’t even deny the bankers their bonuses.
    Now that Detroit went bankrupt, it’s bring out the morality police and begin the beatings because “those people” took control and ran the city into the ground.
    Also missed is that the bankruptcy has happened on the watch of a Tea Party Republican governor and a Tea Party Republican legislature. Shouldn’t they “own” Detroit’s financial collapse? Or are things more complex than that?
    It’s interesting that when the financial industry and the car industry (on which Detroit once depended) faced financial collapse, they got government help-and they recovered. Maybe government help actually works?
    What free market solutions have the Republican state government proposed? Nothing?
    Not surprised.
    Time for voting in a new state government.

    Like or Dislike: Thumb up 6 Thumb down 7

  25. C. Clavin says:

    Mikey…
    I think that there is a lawsuit against the new law, and an injunction from exercising authority under it.
    Orr was appointed under the weaker 1990 law.
    BTW…the Unions also helped Orr save Chrysler.

    Like or Dislike: Thumb up 2 Thumb down 1

  26. al-Ameda says:

    President Obama: “When Gov. Romney said we should just let Detroit go bankrupt, we said thanks but no thanks.”

    First, do you work for FoxNews? Second, taking action to bail out an auto industry company thereby saving hundreds of thousands of jobs in the auto industry at-large is despicable thing to do, and it is COMPLETELY unrelated to the municipal bankruptcy of the city of Detroit.

    Like or Dislike: Thumb up 9 Thumb down 2

  27. john425 says:

    “— Detroit is sagging under decades of bad governance. ”The city’s operations have become dysfunctional and wasteful after years of budgetary restrictions, mismanagement, crippling operational practices and, in some cases, indifference or corruption,” Orr wrote in May. “Outdated policies, work practices, procedures and systems must be improved consistent with best practices of 21st-century government.” (For the record, Detroit has been a one-party city run continuously by Democrats since 1962.)”

    Obama has learned the Detroit lesson well and is steadily applying bad governance to the national government.

    Like or Dislike: Thumb up 5 Thumb down 8

  28. C. Clavin says:

    @ john425…

    “…Obama has learned the Detroit lesson well and is steadily applying bad governance to the national government….”

    Hmm…
    Handed an economy shedding 650,000 jobs a month he turned that around…without adding public sector jobs…the way that Republicans always do.
    The deficit is shrinking…quickly.
    All in the face of the biggest do-nothing Republican Congress in history.
    It’s pretty apparent that the facts don’t match your ideology.

    Like or Dislike: Thumb up 9 Thumb down 5

  29. edmondo says:

    @stonetools:

    I see stonetools has another amnesia episode:

    when AIG and the rest of the financial industry was going bankrupt, Republicans fell over themselves dumping 780 BILLION dollars into the financial industry’s coffers and told us that saving the banking system was crucial-so crucial that we couldn’t even deny the bankers their bonuses.

    The reality:

    Democrats voted 172 to 63 in favor of the legislation, while Republicans voted 108 to 91 against it; overall,

    Like or Dislike: Thumb up 9 Thumb down 2

  30. Jenos Idanian says:

    @C. Clavin: You keep picking the same cherry-picked metrics for how awesome the economy is. Why don’t you ever discuss the shrinking work force, the conversion of full-time jobs to part-time jobs, and how the sequester is affecting that incredible shrinking deficit?

    This is a recovery only a Wall Street fatcat could love, Cliffy. I wouldn’t have pegged you for one of their fanbois.

    Like or Dislike: Thumb up 4 Thumb down 4

  31. Jimbo OPKS says:

    @edmondo: Let’s not get ugly by stating the facts. BTW, many in the GOP felt the bailout was a mistake.

    Like or Dislike: Thumb up 3 Thumb down 3

  32. stonetools says:

    @edmondo:

    Ah, who was the President then, and which Administration proposed it again? I didn’t forget that.
    FWIW, I supported the TARP bailout, although I wouldn’t have given the finance industry carte blanche, the way Treasury Secretary Paulson did.
    The point is that many Republicans are OK with the government helping their friends on Wall Street, but are dead set against helping Main Street.

    Like or Dislike: Thumb up 2 Thumb down 2

  33. C. Clavin says:

    “…Why don’t you ever discuss the shrinking work force, the conversion of full-time jobs to part-time jobs, and how the sequester is affecting that incredible shrinking deficit?…”

    All the direct result of a Republican party fixated on austerity in the face of an economic downturn.

    Like or Dislike: Thumb up 3 Thumb down 2

  34. Jenos Idanian says:

    @C. Clavin: Shorter Cliffy: all the good news is because of Democrats, all the bad news is the fault of Republicans, and everything would be kittens and rainbows if those Republicans would just go away.

    Do you really need a list of the incredibly bad economic decisions and policies just from this administration? Green jobs, Cash for Clunkers, the particulars of the GM and Chrysler bailouts…

    Like or Dislike: Thumb up 3 Thumb down 3

  35. edmondo says:

    @stonetools:

    many Republicans are OK with the government helping their friends on Wall Street, but are dead set against helping Main Street.

    Looks like that guy in the White House keeps pumping out “republican policies”. I wonder what that makes him?

    http://www.upi.com/Top_News/Analysis/Outside-View/2013/07/18/Outside-View-Easy-money-the-opiate-of-the-US-economy/UPI-96351374120240/

    Like or Dislike: Thumb up 1 Thumb down 2

  36. edmondo says:

    @C. Clavin:


    All the direct result of a Republican party fixated on austerity in the face of an economic downturn.

    Cliffy, cliffy cliffy…
    Do you even read the newspapers anymore or do you just regurgitate stonetools’ talking points?

    http://politicalwire.com/archives/2013/07/17/white_house_starts_grand_bargain_talks_again.html

    Like or Dislike: Thumb up 2 Thumb down 2

  37. C. Clavin says:

    @ Jenos and Edmondo…
    Blah blah blah.
    Seriously? Cash for clunkers? Of what signifigance is that?
    Republicans left an economy hemoraging 650,000 jobs a month. A Dow at 7000. But, but, but, CASH for CLUNKERS!!!</em>
    You clowns are laughable.

    Like or Dislike: Thumb up 4 Thumb down 2

  38. Jenos Idanian #13 says:

    In actual germane news, not Cliffy’s frothings and whatnot, a judge has ruled against the bankruptcy petition, saying that The Divine Barack Would Not Be Pleased.

    “It’s cheating, sir, and it’s cheating good people who work,” the judge told assistant Attorney General Brian Devlin. “It’s also not honoring the (United States) president, who took (Detroit’s auto companies) out of bankruptcy.”

    Aquilina said she would make sure President Obama got a copy of her order.

    “I know he’s watching this,” she said, predicting the president ultimately will have to take action to make sure existing pension commitments are honored.

    I was previously unaware of the legal implications of “not honoring the president,” but then again I’m not a lawyer.

    Like or Dislike: Thumb up 2 Thumb down 2

  39. al-Ameda says:

    @Jenos Idanian #13:

    The Divine Barack Would Not Be Pleased.

    You guys really have a Messiah Complex.

    Like or Dislike: Thumb up 5 Thumb down 3

  40. Jenos Idanian says:

    @al-Ameda: I’m not the judge who cited, among reasons for striking down the filing, that “it’s not honoring the president.”

    Like or Dislike: Thumb up 2 Thumb down 5

  41. al-Ameda says:

    @Jenos Idanian:

    @al-Ameda: I’m not the judge who cited, among reasons for striking down the filing, that “it’s not honoring the president.”

    Yes, however she did not refer to the president as “Divine Barack,” you did.

    Like or Dislike: Thumb up 3 Thumb down 2

  42. anjin-san says:

    This is a recovery only a Wall Street fatcat could love

    Or anyone who has an IRA, a 401K, or is a homeowner. I know I am probably taking about folks outside of your personal circle here…

    Like or Dislike: Thumb up 3 Thumb down 1

  43. C. Clavin says:

    Jenos…
    Link to where the judge said;

    The Divine Barack Would Not Be Pleased.

    Otherwise you are a liar and should just STFU.

    Like or Dislike: Thumb up 3 Thumb down 3

  44. Jenos Idanian says:

    @al-Ameda: When a judge cites, in a ruling, a justification that the action is “not honoring the president,” hero worship is probably the best possible interpretation.

    And if you wanna go all literal again, shall we resurrect the whole “Zimmerman was stalking Martin” BS? You still keep pushing that lie, despite being disproved time and time and time again.

    Like or Dislike: Thumb up 2 Thumb down 3

  45. Jenos Idanian says:

    From now on, all bonds should be sold with this disclaimer: “the terms of this bond shall be honored only as long as it is politically expedient. Anyone who actually accepts the pledges made within as binding and enforceable is a legally certifiable idiot, and deserves to lose their investment.”

    At which point, the only buyers for bonds will be liberals, who are willing to take the risk of being sacrificed for “the greater good” at the drop of a hat.

    Like or Dislike: Thumb up 2 Thumb down 3

  46. edmondo says:

    @anjin-san:

    This is a recovery only a Wall Street fatcat could love

    Or anyone who has an IRA, a 401K

    amazing how you bend reality to fit your political bias.

    Of course he was a Democratic Party advisor so I suppose he’s anti-Obama too.

    http://jaredbernsteinblog.com/who-benefits-from-the-climbing-us-stock-market/

    Like or Dislike: Thumb up 2 Thumb down 2

  47. al-Ameda says:

    @Jenos Idanian:
    And if you wanna go all literal again, shall we resurrect the whole “Zimmerman was stalking Martin” BS? You still keep pushing that lie, despite being disproved time and time and time again.

    Look, we all understand that Zimmerman profiled Martin as suspicious because he was Black, then he stalked (you call it following, fine with me) him, and ultimately killed Martin. So, you got the verdict you wanted, and you didn’t have to riot as you had planned – yet you seem so unhappy about it, why?

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  48. anjin-san says:

    @ edmondo

    Not sure what your point is. Do the 1% benefit disproportionately from the recovery? Of course they do. Rich people win more often and win bigger than average folks. What else is new?

    That does not change the fact that almost anyone who holds stock has benefited from the recovery. If your portfolio was worth 5K the day Obama took office, you have not done as well as someone who had holding of 500K, or 5 million. But you have still done pretty well, the market is up what, 65% since Obama was sworn in? So no, the average investor does not have money raining down on him. Average investors seldom do. But he is enjoying very strong sustained growth, and that does not suck.

    Like I said, almost anyone with a 401k or an IRA has benefited from the Obama market. I know I have. Feel free to try and disprove me – you certainly have not done so yet. Hate to slap you in the face with reality.

    Or do you pine for the days before Obama took office? 600K a month job losses. Stock market in free fall. Housing market in free fall. Bank system in danger of failing. A very real danger of depression – something that would make today’s economy seem like kisses from a prom queen. Those were certainly happy times for the average guy…

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  49. anjin-san says:

    @ Jenos

    And if you wanna go all literal again, shall we resurrect the whole “Zimmerman was stalking Martin” BS?

    Look, we all know you have sort of a stiffy for George Zimmermann. The Zimmermann threads you so pined for exist on OTB. If you want to keep talking about your boy, please vist them.

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  50. anjin-san says:

    I have a question for Republicans. Can you show us a recovery under a GOP administration that did not involve growing the government?

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  51. Jenos Idanian says:

    @anjin-san: I have a question for Republicans. Can you show us a recovery under a GOP administration that did not involve growing the government?

    No, because I can’t think of a recovery under a GOP administration that didn’t involve compromising with the Democrats and throwing them some bones to get them to go along with saving the country.

    The “growing the government” wasn’t a feature of the recovery, it was a necessary compromise to get Democratic buy-in.

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  52. superdestroyer says:

    @stonetools:

    I guess progressives refuse to remember who controlled the House and Senate when the bailout laws were passed. Once again, progressives operate from the POV that if one Republicans is involved, then the Republicans are responsible for everything bad that happens.

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  53. Ameriman says:

    @anjin-san:
    In 1918, Republican Warren Harding inherited a miserable Democrat recession/depression…
    Harding responded with big cuts in Government size, spending, regulation…… creating a quick turnaround, creating a decade of roaring Republican prosperity called the ‘roaring 20s’…

    However, liberals took congress in 1928, began massive increases in Federal Govt spending/size/power…. creating recession..
    Democrat FDR then took power and brought the 10 years of the First Democrat’socialist Great Depression……. ended only by WW2 after every liberal/socialist program/policy/spending/deficit FAILED…

    Same thing when the Pelosi/Reid/Obama Democrat congress inherited record prosperity, 4.4% unemployment, low/dropping deficits… then began the massive Govt growth, with Obama throwing gas on the fire of DemocratGovt size/corruption/incompetence

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  54. edmondo says:

    @Ameriman:

    You might want to go back for some remedial American history classes:

    1) Warren Harding wasn’t elected until 1920.
    2) the 71st Congress that was seated in 1929 was 39 Democratic Senators and 56 Republican. In the House it was 163 Democrats to 267 Republicans with 5 others parties.
    3) in 2007 we were in 2 wars costing us trillions of dollars, income disparity was at Diamond Jim Brady levels of the 1880s. The deficit was “dropping” only because the Bush Administration made the wartime expenditures “off-budget.”

    You are as fact adverse as stonetools but your agenda is the same. To root for your side regardless of the truth.

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  55. al-Ameda says:

    @Ameriman:

    In 1918, Republican Warren Harding inherited a miserable Democrat recession/depression…

    In 1933, Democrats inherited a catastrophic Republican Depression, and in 2009 Democrats inherited another catastrophic Republican Recession/Depression. Interesting trend with respect to catastrophic economic events, wouldn’t you say?

    By the way, do you have a point to make here?

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  56. Ameriman says:

    @edmondo:
    remedial American history classes
    ========= =
    Your point was relating Govt growth to recession/depression onset and extension…

    http://www.usgovernmentspending.com/federal_spending_chart
    Govt spending SKYROCKETED in 1928-29, as I said a liberal congress (RINO), bringing on a deep recession… Democrat FDR turned that recession into a 10 year old miserable Democrat/Socialist Great Depression…

    Warren Harding’s slashing Federal Govt power/intrusion/regulation/size/spending ended the previous Democrat recession, and created a decade of prosperity..

    FDR’s liberal/Democrat/socialist Big Govt growth/programs/policies/spending/deficits created and maintained FDR’s decade long miserable Democrat/socialist great depression.

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  57. Ameriman says:

    @al-Ameda:
    BS.. I said ‘LIBERAL CONGRESS’… not necessarily Democrat… RINOs

    Govt spending skyrocketed in 1928-29 BEFORE THE RECESSION/DEPRESSION… created it…

    Same as the Jan 2007 Pelosi/Reid/Obama Democrat congress inherited RECORD PROSPERITY… 4.4% unemployment.. $1.60 gas prices.. low/dropping deficits…
    Dems SKYROCKETED SPENDING/DEFICITS…. producing this Second Democrat/socialist Great Depression… aided by the insane ‘affordable housing’ Fannie/Freddie housing bubble and Govt forced/backed ‘sub-prime’ mortgages…

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  58. Jenos Idanian #13 says:

    @al-Ameda: In 1933, Democrats inherited a catastrophic Republican Depression, and in 2009 Democrats inherited another catastrophic Republican Recession/Depression.

    Good point there. Hoover, a Republican, did a lousy job of handling the Depression. And that was because he tried to spend and spend his way out of the Depression, jacking up government spending in what was a prelude to the New Deal.

    And the New Deal didn’t achieve much; it took World War II to really turn the economy around.

    Like or Dislike: Thumb up 2 Thumb down 1

  59. al-Ameda says:

    @Ameriman:

    Same as the Jan 2007 Pelosi/Reid/Obama Democrat congress inherited RECORD PROSPERITY… 4.4% unemployment.. $1.60 gas prices.. low/dropping deficits…
    Dems SKYROCKETED SPENDING/DEFICITS…. producing this Second Democrat/socialist Great Depression… aided by the insane ‘affordable housing’ Fannie/Freddie housing bubble and Govt forced/backed ‘sub-prime’ mortgages…

    Interesting how you ignore the fact that Republicans waged two unfunded (that is, deficit-funded) wars and passed an unfunded (deficit-funded) Medicare Prescription Drug Plan. in January 2009 President Obama inherited a Republican economy that was losing jobs at rate of over 500,00 per month, and financial institutions were imploding. Automakers were on the verge of bankruptcy and hundreds of thousands of auto industry jobs were at risk if automakers went to bankruptcy.

    That was the Republican moonscape that Obama was presented with.

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  60. Ameriman says:

    @Jenos Idanian #13:

    FDR’s Treasury Secretary, Henry Morgenthau, angry at the Keynesian spenders, May 1939: “We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and now if I am wrong somebody else can have my job. I want to see this country prosper. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises. I say after eight years of this administration, we have just as much unemployment as when we started. And enormous debt to boot.”

    FDR still had 14% unemployment after 10 years of his bankrupting liberal socialistic programs/spending/deficit rule

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  61. al-Ameda says:

    @Jenos Idanian #13:

    Good point there. Hoover, a Republican, did a lousy job of handling the Depression. And that was because he tried to spend and spend his way out of the Depression, jacking up government spending in what was a prelude to the New Deal.

    Hoover did not do nearly enough to spend his way out the Depression. There was so much under-utilized capacity in the economy that Hoover could not make a dent with his deficit spending.

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  62. Ameriman says:

    @al-Ameda:

    Congress runs America, and the majority party runs Congress…

    The Pelosi/Reid/Obama Democrat congress took over America in Jan 2007….. amid record prosperity and low/dropping deficits…
    The Republican Congress had 4 budget surplus years, and left in 2006, with the DOW at a record high, unemployment around 4.4%, deficits were moderate and trending down, and after 52 straight months of economic growth.
    The recession started in late 2007, nearly A YEAR AFTER the Democrat Congress took power, GW Bush vetoed not a single Democrat bill…
    Democrats SKYROCKETED spending, deficits….

    Obama inherited his own Democrat Congress recession, turned it into the Obama Democrat/socialist DEPRESSION… whlle adding $10 trillion more Bankrupting Democrat deficit on our innocent children.

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  63. Ameriman says:

    @al-Ameda:
    spend his way out the Depression.
    ===== =
    Have you any concept of intellectual integrity…. can’t you recoginize your own party-line mindless failed BS dogma…
    Govt spending LED THE DEPRESSION… massive spending FAILED to end it…
    Govt spending CAUSES RECESSIONS/DEPRESSIONS… NEVER CURES THEM..

    Every penny Govt takes from the productive economy REDUCES INCENTIVES.. IMPOVERISHES US ALL..

    Obama/Pelosi/Reid spent/wasted to add $10+ trillion new bankrupting Democrat deficit… and we ARE WORSE OFF…

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  64. Ameriman says:

    @al-Ameda:
    Republicans waged two unfunded (that is, deficit-funded) wars
    ====== =
    GW Bush inherited the 911 perps in place, trained, ready to attack.. before he was even elected..

    GW Bush lawfully followed the bi-partisan Congressional authorization for military action….

    In direct contrast, Barack Hussein Obama illegally, immorally, unconstitutionally attacked the Libyan people, killed over 100,000 men/women/children… all in violation of our Constitution, War Powers Act, and UN law…. all to destroy the most secular, stable Arab govt, put Alq/Muslim brotherhood murderous jihadists in power over oil rich Libya..

    By any objective standard, Barack Hussein Obama is a mass murdering war criminal.

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  65. al-Ameda says:

    @Ameriman:

    By any objective standard, Barack Hussein Obama is a mass murdering war criminal.

    By any objective standard, Barack Obama would not be characterized as “a mass murdering war criminal.” if half his critics were not deranged in their hatred of this president.

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  66. al-Ameda says:

    @Ameriman:

    Govt spending LED THE DEPRESSION… massive spending FAILED to end it…
    Govt spending CAUSES RECESSIONS/DEPRESSIONS… NEVER CURES THEM..

    The Great Depression was caused by government spending?
    It seems to me that a firm grasp of cause and effect is a problem for you.

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  67. Ameriman says:

    @al-Ameda:
    Barack Obama would not be characterized as “a mass murdering war criminal
    ==== =
    Of course Barack Hussein Obama is a mass murdering war criminal…. he killed over 100,000 Libyan men/women/children… ILLEGALLY…. UNILATERALLY…. without required Congressional authorization…
    After the Kennedy/Johnson Vietnam war crimes, the congress passed the ‘War Powers Act’ to absolutely clarify that POTUS MUST get Congressional authorization before attacking ANY foreign country or power…. only Congress has the power constitutionally to order war

    Our founders would NEVER hand ONE MAN, however arrogant, irresponsible, ego-maniacal the power to wage war…..
    Barack Hussein Obama had NO AUTHORIZATION for his murderous, brutal, 9 month attack.

    Barack Hussein Obama should be impeached, tried/convicted, then handed over to Libyan orphans/widows and grieving families for their justice.
    .

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  68. al-Ameda says:

    @Ameriman:

    Barack Hussein Obama should be impeached, tried/convicted, then handed over to Libyan orphans/widows and grieving families for their justice.

    Oh, I’m sure that you sent your condolences to the Iraqi people for our role in one of the most unnecessary and costly wars we have undertaken in the post-Vietnam era.
    .

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  69. Ameriman says:

    @al-Ameda:
    condolences to the Iraqi people
    === =
    The Iraq war was ordered in the legal Congressional bi-partisan ‘Authorization for Use of Military Force Against Iraq Resolution of 2002″… legal per our Constitution and War Powers act… and under UN authorization…. GW Bush was a patriot who carried out Congress’s orders..
    The responsibility for the Afghanistan and Iraq military actions rests in Congress and through them the US people.

    In direct Contrast, Barack Hussein Obama illegally, immorally acted without required Congressional or UN authorization…. unilaterally, illegally, immorally attacked a country of no threat to America or any other country…

    This illegal action IS A WAR CRIME.. a mass murder… on Obama’s ILLEGAL, PERSONAL ORDERS AND RESPONSIBILITY.

    Obama should be impeached, tried/convicted… for his illegal war crime.

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  70. Ameriman says:

    @al-Ameda:
    costly wars we have undertaken in the post-Vietnam era.
    =============== ==
    Lets review American wars of the last 100 years, and discover who is the warmonger party:
    . Democrat Woodrow Wilson entered WW1: causing 116,000 US Dead.
    . Democrat FDR entered WW2, resulting in 416,000 US deaths.
    . Democrat Truman entered the Korean war, yielding in 40,000 US Deaths
    . Democrats Kennedy/Johnson entered Vietnam, with 58,000 US Deaths
    . Republican Bush entered Afghanistan/raq, with 5,000 US deaths.
    Totals:
    Democrats: 640,000 American war deaths
    Republicans: 5,000

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  71. al-Ameda says:

    @Ameriman:

    . Democrat Woodrow Wilson entered WW1: causing 116,000 US Dead.
    . Democrat FDR entered WW2, resulting in 416,000 US deaths.
    . Democrat Truman entered the Korean war, yielding in 40,000 US Deaths
    . Democrats Kennedy/Johnson entered Vietnam, with 58,000 US Deaths
    . Republican Bush entered Afghanistan/raq, with 5,000 US deaths.
    Totals:
    Democrats: 640,000 American war deaths
    Republicans: 5,000

    LOL! You just dig deepeer while the trench is collapsing around you and burying you. You can’t help yourself, can you?
    Nixon waged war in Vietnam too – of course you forgot that. Republicans would have ignored the attack on Pearl Harbor? Also, good to know that Republicans were willing to let Hitler do his thing while we sat it out. I had no idea that Republicans were such cowering pacifists.

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  72. Ameriman says:

    @James Pearce: @al-Ameda:
    Nixon waged war in Vietnam too ….. Republicans would have ignored the attack on Pearl Harbor?
    ===== =
    Nixon inherited the Democrat Vietnam war…. and ended it..

    FDR was CIC for a FULL DECADE BEFORE PEARL HARBOR…
    A Republican CIC would have preempted German/Japanese armament/aggression many years earlier, before it got to that point.

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