Quote:
Originally Posted by Z
How can an entire city declare itself bankrupt? I say that both as a question and as a statement of disbelief. How did things get so bad? What happens when a city declares itself bankrupt? How can it recover? What does that mean for its residents?
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The city has a local Government, and that Government took out huge loans to fund it's operations and also welfare programs. Detroit is a dead city, it's no different than the ghost towns that dot the west when people were traveling west. the American auto industry collapsed, and Detroit was the capital of the American auto industry. Now it can't pay it's bills, hence, the city is in bankruptcy. When a city owes huge debts and has no feasible way of paying them back, they go into bankruptcy. it's not hard to understand. Detroit is ****ed. maybe we can sell Detroit to Canada? bargain basement prices!
It's kinda like New Orleans after Katrina, but instead of a natural disaster, it's a disaster of their own making.
Detroit borrowed a lot of money to pay for their local progams, and now they can't keep up with the debt. Because there are NO JOBS IN DETROIT. the economy collapsed and some lazy people stuck around hoping the government would support them forever. A city can't support itself if it has no jobs and no people paying TAXES to fund the government, so it went broke.
TLDR: American car industry moved overseas, no more jobs in Detroit. no more jobs in Detroit means no more taxes paid to the government, no more taxes paid to the Detroit government means they can't pay their debts. Detroit not being able to pay their debts means they are in bankruptcy.