Detroit Files For Bankruptcy After Decline

[Jazzy]

Detroit, once the hub of America's car industry, has become the biggest city in US history to file for bankruptcy with debts estimated at $18.5bn (£12.1bn).

The federal bankruptcy court filing, which has been feared for months, puts the city on an uncertain course and sets the stage for a costly court battle with creditors.

The bankruptcy, if approved by a federal judge, would force Detroit's thousands of creditors into negotiations with the city's Emergency Manager Kevyn Orr to resolve the debt that has crippled Michigan's largest city.

The future of pensions and health benefits for thousands of city workers hangs in the balance.

Anticipating the filing, investors drove prices of Detroit bonds lower, sending their yields to record highs on Thursday.

In a letter accompanying the filing, Michigan Governor Rick Snyder said he had approved a request from Mr Orr to file for Chapter 9 bankruptcy protection.

In the letter, he wrote: "Detroit simply cannot raise enough revenue to meet its current obligations, and that is a situation that is only projected to get worse absent a bankruptcy filing."

Detroit was once a hugely prosperous car manufacturing centre that exemplified American progress.

Its automotive giants switched production to planes, tanks and munitions during World War Two, earning the city the nickname of the "Arsenal of Democracy".

Now the city's name has become synonymous with decline, decay and crime.

Video

Guess they should have stayed in the car manufacturing business.

 

[DrLeftover]

No, sorry about that.

Lansing — Ruling the governor and Detroit’s emergency manager violated the state constitution, an Ingham County Circuit judge ordered Friday that Detroit’s federal bankruptcy filing be withdrawn.
...

“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 do something to make sure existing city workers’ pension agreements are honored.

http://www.detroitnews.com/article/20130719/METRO01/307190099/Ingham-County-judge-rules-Detroit-bankruptcy-withdrawn?odyssey=tab|topnews|text|FRONTPAGE

 

[DrLeftover]

And then they can do it

24 Jul 2013

A federal bankruptcy judge on Wednesday suspended pending lawsuits in state courts that are challenging Detroit's bankruptcy filing.

U.S. Bankruptcy Judge Steven Rhodes said there is nothing in the 10th Amendment, which guides state vs. federal jurisdiction, that bars federal jurisdiction in this case. He said his court will be the exclusive venue for any legal action regarding the bankruptcy.

http://www.cnbc.com/id/100674600

 

[wirelessguru1]

Yep, civilization is about to fall...

 

[Evil Eye]

I'm not sure that counts as civilization from what people have been telling me.

 

[JetWing34]

The only way to save Detroit is to send all businesses to China, India, Canada, Brazil, Mexico, Italy, and other countries. That, and move all professional sports teams out of state.

Other than that, Detroit is dead.

 

[wirelessguru1]

I'm not sure that counts as civilization from what people have been telling me.

Well, Detroit is just the tip of the iceberg...