On July 18, 2013, two financial occurrences hit this country that should wake up some eyes. The biggest news was that the city of Detroit declared bankruptcy. The Michigan city becomes the largest urban town to declare itself bankrupt. It also follows on the heels of Stockton, CA, which declared bankruptcy in April.
The other bit of news on July 18 is that Moody’s Investor Services dropped Chicago’s credit rating three ticks, from Aa3 to A3. Moody’s attributed the downgrade to the city’s pension shortfall (does that ring a bell, folks?) and overall budget largesse (meaning its spending outpaces its revenue). Moody’s calculates that Chicago’s pension funds are only at 22 percent of what is needed to meet its obligations. Moody’s also gave Chicago a negative label for its future.
And, then there is Illinois. Illinois has seen 13 credit rating drops in the last four to five years. Its pension obligations are more than $100 billion short, the state is about $6.5 billion and one year behind paying its bills, and the state’s outlook also is negative. Detroit, Chicago and Illinois are all in deep trouble. And they all have several common denominators.
A major common denominator is they’ve been ruled by liberal Democrats for decades in one-party rule governments. Another is that they have public employee unions that have largely broken the backs of those governments. They also are high tax entities with out-of-control spending. Another commonality has been a crumbling education system. High crime also troubles Chicago and Detroit (not so much a state problem). And there you basically have it.
Now, before some folks jump on me, Chicago is in a better place than Detroit. Chicago is still a thriving city. Chicago also is more economically diverse. It does not rely on one industry as Detroit did. But how much longer can Chicago last? Will Chicago be Detroit in 40 years? 30 years? 20 years? Chicago’s pension debt is significant. Crime in many neighborhoods is out of control. Its school system is crumbling and the teacher’s union is not interested in improving it. The city’s taxes are unwieldy.
Chicago also faces another peril: the state of Illinois. Illinois’s pension is more than $100 billion short. Its taxes and spending also are high and out-of-control. The property tax issue is nearing crisis, with several organizations reporting that property taxes in Illinois are not “sustainable” and will continue in seeing more residents and businesses flee the state. So, as Illinois crumbles so too will Chicago and other municipalities. While Detroit continues its death spiral, at least the state of Michigan has new leadership that actually has enacted reforms designed to help the state recover from its near destruction. While the future for Michigan is looking a little brighter, the same cannot be said for Illinois – and, as noted, Moody’s has said as much.
With the destruction of Detroit, Illinois in a death spiral of it its own and Chicago heading down its own slippery slope, can anyone seriously deny that liberal Democratic policies are not a complete and utter failure? That the big government idea of more programs, more spending and more taxing simply has not and is not working? That one-party rule is failing? Can anyone seriously deny that corrupt political atmospheres have damaged Detroit, Chicago and Illinois?
Detroit’s population has declined to 700,000, down from about 2 million in its heyday. There are nearly 80,000 abandoned properties in Detroit. The city is nearly $20 billion in the hole. It is believed that city workers and retirees will be lucky to get 10 percent of their pension paid back to them with the bankruptcy declaration.
Democracy is a foundation of this country’s development, growth and greatness. Democracy has not existed in Detroit and Chicago for decades. Democracy barely exists in Illinois – it has been basically one-party rule for a decade with the Illinois legislature in Democratic hands for most of the past 35 years. There are few checks and balances
Just in the past couple of weeks we’ve learned that ousted Metra CEO Alex Clifford apparently lost his job because he wouldn’t bend to the wishes of the all-powerful House Speaker Michael Madigan. The chief of staff of the Regional Transportation Authority, which oversees Metra, is the son-in-law of Michael Madigan. The Senate Majority Leader, John Cullerton, is the godfather to Madigan’s only son.
And, then there is Lisa, the adoptive daughter of Michael Madigan, who is the state’s attorney general. She said she won’t run for governor because it’s not healthy for the state to have the governor and Speaker of the House from the same family. I agree. But it also isn’t healthy that she is attorney general. One of the main jobs of the attorney general is to investigate political corruption. Lisa has not done any of that in nearly 12 years. And she wants another term?
When asked about a conflict of interest with her being attorney general, Lisa told the reporter that he “reads too much John Kass (columnist at the Chicago Tribune).” Another reporter asked if her father ever asked her to hire anyone. She said she is not involved in the hiring and firing of people within her department. Yeah, right.
In Chicago, Alderman Dick Mell announces his retirement from City Hall government. Naturally his daughter, Debra, says she wants the position. This is not how democracy works. This is how it works in totalitarian regimes. This is why North Korea is the land of despair and is destitute. Is Detroit any different? Is Illinois much different? Is Chicago?
Detroit, Chicago and Illinois show without a doubt that liberal Democratic policies are an abject failure. They have failed – miserably. If you think differently, then prove it.