A clever man (or a clever city or state government) can survive and even appear to prosper for awhile on very limited resources. He can live on borrowed money, shifting from creditor to creditor as bills come due, going ever deeper into debt. Promises flow from him, and plans for recouping his fortunes and producing great wealth. Many will extend credit to him because he puts up a good front, weaves fascinating justifications for his failures, and paints seductive word pictures of his prospects.
There comes a time, however, in the affairs of the cleverest of such men when their confidence game no longer works its magic. A "credibility gap" appears; the promises, instead of attracting further credit, have all become notes falling due. Notes are presented for payment; credit is not extended; the debts cannot be paid. When that happens, a man is bankrupt. Any resources he has are taken from him to satisfy, as far as they will, the claims of his creditors.
Such is the plight of Detroit and of a long list of other cities in the United States, virtually all of which have been caused by decades of frivolous, unsound progressive liberal fiscal policy (or lack of same). "liberals" have promised world peace through international organization (first the League of Nations and then the United Nations), a modus vivendi with communists through concessions, the good will of all nations that would result from foreign aid programs, recovery from depression by inflation, a balanced budget with increased taxes, a balanced budget through reduced taxes, the solution of the farm problem by government programs, the solution to crime and delinquency through housing programs and aid to the poor, security in old age by way of social security taxes, quality education as a result of higher taxes, peaceful labor relations by way of government empowerment of labor unions, the rescue of small business by antitrust action, the revival of cities by pouring government credit and money into them, an end to monetary problems by a Federal Reserve System, better transportation service at lower prices by government regulation, the restoration of a "balance" between rural and urban inhabitants by farm subsidies, and so on, almost endlessly.
So the news that the city of Detroit is declaring bankruptcy may not surprise many observers who were aware of how economic decline, shrinking population, the burden of huge public employee contracts and political corruption was leading inevitably to this outcome. But it might come as something of a shock to the vast majority of Americans whose only thoughts about the subject prior to today were framed by the demagoguery on the issue that came from President Obama’s reelection campaign. As we all recall, Democrats spent a good deal of 2012 telling us that “General Motors is alive and Osama bin Laden is dead” and hounding Mitt Romney for saying that Detroit would be better off going bankrupt rather than being bailed out by the federal government. But we have just learned that all the sunny talk about what Obama had accomplished *did nothing to save the city*.
It's time for a big change in America. Progressive liberalism has run out of time. The "fit has hit the shan", so to speak, and now it's time to clean it all up and return to the concept of fiscal soundness that this great country was built upon. But we won't get any of that by electing Democrat politicians.