底特律破产也有光明的一面

    底特律的问题无疑有很多，其中人口的急剧减少无疑加速了这座城市破产的进程。过去十年间，底特律的人口减少了25%，对它的财政造成了毁灭性的影响。自2002年以来，由于人口锐减，底特律的税收减少了40%，州拨款减少了50%。尽管它的支出也相应减少了，但在同一时期内只减少了15%。这种差距导致该底特律的资产负债表上出现了一个无比巨大的窟窿，自从2008年以来，这个窟窿平均每年都在1亿美元左右。

    据底特律的紧急情况经理近日发布的一份报告表示：“尽管开支有所降低，但底特律市还在继续进行超过财政收入的开支，同时还在发行长期债务。换句话说，底特律的开支超过了收入，从现金流的角度看，它显然已经无力偿还这些债务。”

    在增收方面，底特律可打的牌也很少。它不能提高税率，因为底特律的税律已经达到了密歇根州规定的法定极限；同时它也无法从密歇根州政府那里获得额外的拨款，因为州政府的支出是严格与人口基数相关联的。底特律或许只能像2008年以来那样继续向债务市场借钱，但这样只会继续加重该市的债务问题。

    因此，如果底特律无法创造更多的收入，就必须削减开支。但底特律已经把服务开支削减到了一个危险的低水平，它意味着如果进一步采取紧缩措施，也很难使各种指标向好。因此底特律需要削减它的还债支出，这项支出目前已经占到了该市预算的42%。这也就是为什么底特律的紧急情况经理凯文•奥尔决定让这座城市破产。因为他无法与底特律的债权人们达成协议，让该市的还债开支下降到一个底特律能够维持的水平。

    不过与哈里斯堡或伯明罕等地不同的是，底特律发行的债务规模其实是可控的。底特律的债务总额大约有180亿到200亿美元，其中只有6.75亿美元是所谓的一般责任债券。这是一种昂贵的债务，投资者每年的收益高达10%。对于市政债券来说，它的利率高到了荒唐的地步，但它也不是导致城市最终破产的原因。

    最终缚住了这座城市的手脚的是预计高达150亿美元的各种福利支出，也就是这座城市应该付给退休工人的钱。这150亿美元代表了底特律要用来支付养老金、医疗保健费用和其它退休福利开支的现值。

    因为一个愚蠢的错误导致破产是一回事——比如在一个垃圾焚烧项目上投入太多的金钱。但是因为滚雪球式的福利支出增长导致城市破产就完全是另一回事了。底特律的问题是结构性的，所以它需要一次彻底的手术。不幸的是，这座城市直到最后一刻才开始直面这个问题。而在此之前，它选择了削减城市服务和增税这种挖东墙补西墙的策略，导致人口大批外流，情况不断恶化。警务开支的减少使底特律的犯罪率飙升到全美其它大城市的五倍，与此同时，它的人均税务负担也是全密歇根州最高的。这样一来，谁还愿意住在那里？

    But of all of Detroit's issues, and there are clearly many, it is the sharp and relentless decrease in its population that appears to have hastened the city's trip to bankruptcy court. Detroit's population declined by 25% in the last decade, which has had a devastating impact on the city's finances. Since 2002, Detroit has experienced a 40% decrease in tax receipts and a 50% decrease in state funding because of this population drop. And while the city's expenses have also declined, they are down just 15% during the same time period. This disparity created a huge hole in the city's balance sheet, which has averaged around $100 million annually since 2008.

    "The City of Detroit continues to incur expenditures in excess of revenues despite cost reductions and proceeds from long‐term debt issuances," according to a recent eport on the state of the city's finances issued by Detroit's state-appointed Emergency Manager. "In other words, Detroit spends more than it takes in -- it is clearly insolvent on a cash flow basis."

    Detroit has little in the way of options when it comes to raising additional revenue. It can't jack up city tax rates, as they are already at the state-mandated legal limit, nor can it receive additional cash from Lansing, as state payouts are strictly linked to population size. Detroit could have turned to the debt markets as it has since 2008, but that would have just compounded the city's debt problems.

    So if the city can't raise more revenue, it must cut its expenses. But Detroit has already cut services to dangerously low levels, meaning that further austerity measures would barely move the needle. Detroit therefore needs to reduce its liability payments, which currently consume around 42% of the city's budget. This is the primary reason why Kevyn Orr, the city's "Emergency Manager" put the city into bankruptcy. He was unable to secure deals with Detroit's creditors that would have brought the city's debt payments down to a level that the city could handle.

    But unlike Harrisburg or Birmingham, the debt Detroit issued is manageable. Indeed, only $675 million of the city's estimated $18 to $20 billion debt load is actually linked to general obligation (GO) bonds. It is expensive debt, yielding some 10% per year for investors, which is absurdly high for a muni bond, but it isn't what is drowning the city.

    What has Detroit wrapped in chains is the estimated $15 billion in entitlement payouts the city owes its retired city workers. That number represents the present value of what it will cost the city to pay pension, health care and other retirement benefits it has promised its former city workers.

    It is one thing to fall into bankruptcy because of a stupid mistake, like spending too much on a trash incinerator project, but it is another thing entirely to be in bankruptcy because of ballooning entitlement expenses. Detroit's problems are structural, so they require radical surgery. Unfortunately, the city waited till the very last possible moment to address this issue. It chose to slash city services and jack up taxes instead, which led to increased migration, thus making the situation even worse. The cuts in police coverage mean that Detroit has a violent crime rate that is five times the national average for large cities. Meanwhile its taxes on a per capita basis are the highest of all Michigan cities. Would you live there?