(VIDEO) Bankrupt: How Cronyism And Corruption Brought Down Detroit

This documentary, directed by Ben Howe, was released to YouTube on Friday. It goes about 41 minutes, and it gives a pretty good summary of the history of how the richest city (per capita) in the world when the last Republican mayor left office in 1961 descended in a little over half a century into a smoldering ruin.

Bankrupt mostly talks about how the auto industry cratered in the 1970’s and 1980’s under the weight of sweetheart union contracts and has spent the decades since in a string of efforts to corrupt governments at each level into giving it sweetheart treatment and protection from the market. It unfortunately doesn’t delve too heavily, at least not until the end, into the widespread incompetence and dysfunction of the city’s government. More on that after the show…

The arguments made in the film are all very solid. The bailouts of GM and Chrysler were abominations, and the terms on which they were given were shamefully political – they were payoffs to the United Auto Workers who bore large-scale responsibility for dragging GM and Chrysler into bankruptcy in the first place.

What is interesting is what isn’t touched on in the film; namely, the fact that Ford didn’t take a bailout. Ford saw the abyss coming and took steps to survive and pull back from the abyss. In a free market, Ford should have emerged in a dominant position, perhaps snapping up some of the assets and product lines of Chrysler and GM to become the largest and best car company in the world. Ford was denied that reward due to government action, and nobody has mentioned that.

And while the criminal ex-mayor Kwame Kilpatrick’s name was discussed in the film, nothing was said about longtime mayor Coleman Young, whose corruption, incompetence and Third World socialism over two decades at the helm of that beleaguered city had more to do with Detroit’s decline than perhaps anything else. One wonders whether – as Kevin Williamson’s brilliant piece on the city in National Review over the weekend recognizes – concerns over being called racist for delving too deeply into the performance of Young and Kilpatrick in office might have accounted for the omissions. After all, as Williamson put it…

Detroit is what Democrats do. The last Republican elected mayor of Detroit took office during the Eisenhower administration. The decay of Detroit is not the inevitable outcome of the decline of the automotive industry: The automotive industry is thriving in the United States — but not in Detroit. It isn’t white flight: The black middle class has left Detroit as fast as it can. The model of Detroit politics is startlingly familiar in its fundamentals, distinguished only by its degree of advancement: Advance the interests of public-sector unions and politically connected business cronies, expand the relative size of the public sector remorselessly — and when opposed, cry “Racism!” When people vote with their feet, cry “Racism!” When the budget just won’t balance, cry “Racism!” Never mind that the current mayor of Detroit is the first non–African American to hold that job since the 1970s, or that, as one Detroit News columnist put it, “black nationalism . . . is now the dominant ideology of the [city] council” — somewhere, there must be a somebody else to blame, preferably: aged, portly, white, male, and Republican. No less a fool than Ed Schultz blamed the straits of this exemplar of Democratic single-party rule on “a lot of Republican policies.” Melissa Harris-Perry, “America’s leading public intellectual,” blames Detroit’s problems on its conservatism and small government, oblivious to the fact that Detroit maintains twice as many city employees per resident as do larger cities such as Fort Worth and Indianapolis, and three times as many as liberal San Jose.

The fact of the matter is that when you have a government structure which seeks to subsidize failure on an individual level, via welfare and other “leveling schemes” to borrow a phrase from Sam Adams, that government structure will inevitably seek to subsidize failure on a corporate level. This is what you get when leftist politicians wish to be seen as “business-friendly,” and they will break their backs in an effort to attract crony-capitalist companies seeking to jump from their current perch in search of a sweet deal somewhere else. For 25 years Detroit chased companies that would magically bring back the jobs the auto industry was hemorrhaging, and for 25 years they exempted those companies from the punitive taxation local businesses were buried under.

And, as the film discusses, the new companies never delivered the jobs they promised the politicians, while the local employer base decamped for the suburbs or the Sun Belt.

Until nothing was left, and the city went bankrupt after the president spent the 2012 election bragging about how he “saved” it by bailing out GM and Chrysler.

Detroit wasn’t the first, and it won’t be the last of the failed cities operating on the Progressive/Industrial Left 20th Century business model. As of today, though, it’s certainly the shining example of how corrupt and incompetent government, working with failing, rent-seeking business, can wreak the kind of destruction one formerly only expected could happen as a result of a war or a natural disaster.

As it turns out, the Left is worse than war, worse than a hurricane, worse than earthquakes or volcanoes. You can’t recover from what the Left can do to you.

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