Federal government twice as bankrupt as Detroit
Aug 8, 2013
Detroit declared bankruptcy a few days ago.
I’ve written for years about how Detroit should serve as a stark warning to Americans who believe in liberal social policies, like highly progressive taxes and expensive social safety nets.
These socialist programs don’t cure income inequality. They merely destroy wealth by reducing incentives for building businesses and encouraging dependency. That’s why societies with lots of government spending typically have few civil institutions and a small middle class.
Here’s the message our politicians on both sides of the aisle seem to miss: Fifty years ago, Detroit was one of the largest and wealthiest cities in the world. Nearly 2 million people lived there, and it enjoyed the highest per-capita income in the United States.
Then, in 1960, everything changed.
Liberal Democrats came to power (and have held power since). Their ideas about using the government to build a “Great Society” – using the government to provide a cradle-to-grave social safety net – have slowly transformed Detroit from the wealthiest city in America to a hellhole.