Detroit Goes Dark: Half of Detroit's Street Lights May Go Out To Save Money; Left to the Rats

Michigan Governor Rick Snyder on Thursday announced a state takeover of Detroit’s finances and appointed as manager a corporate bankruptcy expert who took a can-do attitude toward turning around the destitute city, calling it the “Olympics of restructuring.” Kevyn Orr, an attorney who worked on the restructuring of Michigan-based automaker Chrysler, said as the city’s emergency financial manager he hoped to avoid a bankruptcy filing by Detroit, something that would rank as the biggest municipal bankruptcy in U.S. history.

Michigan Governor Rick Snyder plans to name an emergency manager to handle Detroit’s fiscal crisis, stripping power from local officials in a withered city that in 1940 was the fourth biggest in the U.S. and a thriving capital of industry. Snyder, 54, said Friday at a public meeting in Detroit that he plans to take a step he avoided a year ago. The move punctuates decades of decline in the home town of General Motors Co. His decision may inflame opponents, as the administration of a white Republican seizes control of a place that is predominantly black and Democratic.

Space does not permit a complete discussion of zombified cities. Such a list would be in the many hundreds. Rather this post is about four cities in recent news that are among the walking dead. One is even a dumping ground for the dead. Fourth Financial Urgency in Miami in Four years The Huffington Post reports Miami Declares Financial Urgency For Fourth Year In A Row

In the past two decades, a group of specialized hedge funds have transformed corporate bankruptcies, injecting much-needed capital while at the same time drawing fire as “vultures.” Now these same funds may be poised to descend on another landscape: struggling cities and counties — and no place beckons more than Detroit.

The only winners in the financial crisis that brought Detroit to the brink of state takeover are Wall Street bankers who reaped more than US$474-million from a city too poor to keep street lights working. The city started borrowing to plug budget holes in 2005 under former Mayor Kwame Kilpatrick, who was convicted this week on corruption charges. That year, it issued US$1.4-billion in securities to fund pension payments. Last year, it added US$129.5-million in debt, 9.3% of its general-fund budget, in part to repay loans taken to service other bonds.

Sheila Cockrel remembers one early sign of Detroit’s decline: The retailer J.L. Hudson’s turned off the lights on floor after empty floor as shoppers abandoned the world’s tallest department store for new suburban malls. “That’s nobody’s fault, that’s what happens in culture,” said the former Detroit councilwoman who now teaches history at the city’s Wayne State University. “You have these larger economic forces in play.”

Detroit is one of America’s most troubled cities, and its problems sometimes seem intractable. But a new effort to envision a future for Motor City could offer hope to other declining urban centers.   Detroit epitomizes shrinking Rust Belt cities. The once-vibrant hub of the U.S. auto industry has already lost more than 60 percent of its population and about 40 percent of its housing stock, leaving roughly 20 square miles vacant – almost as much as all of Manhattan.