Detroit…Greece…Puerto Rico…Does Anyone See A Pattern?

[Originally published by Forbes]

 

In July of 2013, Detroit became the largest U.S. municipality to go bankrupt. Like with other major news events, this bankruptcy forced us—the American public—to suffer a tidal wave of backwards analysis about the root causes. MSNBC analyst Melissa Harris-Perry explained that it was because Detroit’s government had become “small enough to drown in your bathtub.” A website called PolicyMic blamed NAFTA, never mind that much of Detroit’s industry merely went to more business-friendly neighboring suburbs. Paul Krugman called the city “an innocent victim of market forces.” But while researching the issue, I discovered a Thomas Sowell article from several years before that attributed the decline to the “Detroit Pattern.” This was a public administration model, he explained, that favored “increasing taxes, harassing businesses, and pandering to unions”–in other words, big government ideology. I remember wishing at the time that Sowell’s phrase would stick, because the “Detroit Pattern” is an apt explanation for the decline occurring both there and elsewhere.   [read the rest at Forbes]