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: 50 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.
Detroit's population has declined by almost 70% since 1960. Roughly half of the people who remain are functionally illiterate. More than 60% live below the poverty line. And roughly half of all adults don't work. Only about one-third of the city's ambulances are in working order. Almost half of the streetlights don't work. It takes the police an average of 58 minutes to respond to emergency calls. The violent crime rate (no surprise) is five times higher than the national average.
It is shocking to realize that only 50 years ago, Detroit was the shining example for the world of capitalism and civil society. It doesn't take long to destroy wealth.
Now consider this? Detroit went bankrupt with total debts of around $20 billion. That's roughly $28,000 per remaining citizen. That's nothing. The debts that the U.S. government has amassed over the same period (the last 50 years) are vastly larger.
Today, all Americans owe more than $16.7 trillion on the federal level ? that's nearly $54,000 per citizen and nearly $150,000 per taxpayer. How many Americans do you think realize that our federal government is twice as bankrupt as Detroit?
Here's another big issue? Detroit is a city made up of mostly African American residents. This has been the case since after World War II, when many black families fled the racism of the South and went north seeking jobs in the auto factories. Detroit became a hub for African American politics and culture. Motown Records is one example of the African American cultural influences that flowed from Detroit.
John Conyers, Detroit's U.S. congressman, is one of the high-profile African American politicians to come from Detroit. A founding member of the Congressional Black Caucus, Conyers is the second-longest serving member of the House, having been re-elected continuously since 1965.
Conyers' wife, Monica, was formerly the head of Detroit's City Council. She's been in prison since 2010, thanks to an FBI investigation of corruption in Detroit. John Conyers was re-elected in 2010, despite his obvious connection to corruption in Detroit.
Given the city's complete collapse, what are our country's black political and social leaders doing to address the city's serious problems? John Conyers' website claims he's focused on "promoting economic development." It then lists the various federal handouts he's helped win for his district? as though simply getting more handouts will cure Detroit's problems.
What about the rest of America's black political and social leadership? What have our president and U.S. attorney general said about the collapse of one of America's wealthiest cities and former capital of African American culture?
The attorney general, Eric Holder, is promising to continue fighting for "justice" in the George Zimmerman-Trayvon Martin case.
President OBAMA! in a recent speech said he would redouble his efforts to fight "income inequality" and that such policies would be his administration's "highest priority." So in short, he's promised to handle Detroit by pandering to his political base and doing more of the things that caused Detroit to collapse.
The right thing to do for the people of Detroit is to empower them to regain their dignity. This means eliminating social programs that encourage reliance on the state, rather than individuals and families. It means kicking out the corrupt politicians. Black leaders need to encourage individual responsibility and family values, not encourage people to live at the expense of their neighbors.
But that's what scares me the most. In the face of Detroit's collapse, not only has no one who should be held responsible even acknowledged the problem? but our country's leaders seem totally oblivious to the causes of Detroit's collapse.
Detroit is a living case study of why government efforts to redistribute wealth don't work. But instead of recognizing any of the lessons of the catastrophe, OBAMA! promises more of the same policies.
Meanwhile, his government is in far worse shape than the city. The only real difference is the president and the federal government are still able to print their way out of trouble, using the Federal Reserve's ongoing manipulation of the U.S. Treasury market.
But what happens when that game ends? And it will. No nation in history became wealthier by printing money and buying its own government's debts. In every case, inflation soon destroyed the economies and wiped out private savings. Rates on the U.S. 10-year Treasury bond have recently moved from 1.6% to 2.6% ? in the face of continued Federal Reserve buying of $85 billion a month.
The dream that the government could provide prosperity to the residents of Detroit has come to its inevitable end. The dream that the federal government can provide prosperity to the entire country is even more delusional. It will come to a far worse end.
Printing trillions in new dollar bills to facilitate the madness won't prevent the inevitable bankruptcy of our country. It will merely gut the middle class of its savings and its wages first.
Believe me? this will come to pass. It will not take another 50 years. Maybe 10.
And when it happens, an enormous number of people will feel betrayed by the government: One group because it's been taxed and inflated into oblivion, and the other because it believed the government's handouts were a civil right, like free speech. How will those two groups relate to each other? My guess is not well. Want a preview? Just spend a few nights walking around downtown Detroit. Let me know how that works out for you? Finally, if you still don't think something has gone terribly wrong with our country, consider this: Our attorney general just sent a letter to the Russians promising that we wouldn't torture or kill National Security Agency leaker Edward Snowden, who's applied for political asylum there.
When I grew up, then-Soviet citizens were fleeing to America to escape such government threats. I don't remember the day the world turned upside down? but it has.