Friday, March 25, 2011

Detroit's Loss of Population Seems To Be Disturbing

At least to the Detroit political caste. No one else seems surprised. Vanishing City: The Story Behind Detroit’s Shocking Population Decline - TIME NewsFeed

A loss of 25% of population in 10 years. A fall from about 950,000 people to just shy of 714,000 people.
Some of Detroit's population loss in the last decade can be attributed to the exodus of middle-class blacks unwilling to subject their children to schools that too often lack the audacity to expect them to succeed, and crime in the relatively affluent neighborhoods that remain.
That movement of a black middle class to suburbia isn't only happening in Detroit, but that's another story.

From the point of view of population, Detroit may be small, but geographically, the city is huge.
And if people never return, it's unclear what will happen to Detroit's nearly 140 square miles — enough to fit Boston, San Francisco and Manhattan with room to spare — that now lie largely vacant. The city, like businesses and governments across America caught in decline, will have to reinvent itself as something smaller.
That 140 square miles contains a lot of roads exposed to the Midwest's brutal winters. It needs to be policed, and get fire protection service. It contains water mains, and sewer lines and all the other infrastructure of a 20th century city.

Taxes are also an issue.
Indeed, Detroit is now so small that it is in danger of losing out on tax revenue available under Michigan law to large cities. One of the once-great industrial powers of America apparently is no longer large enough to warrant levying its own special taxes. State legislators have said they’re willing to revise the law to allow Detroit to continue, but what’s the point? People are leaving for a reason. Surely slightly higher income taxes isn’t going to convince anyone to stay.
I expect to see them raise taxes. They already can't agree on cuts.
Alternatively, the city could take a hard look at why its tax code works out to a 97 mill tax rate on homestead properties, according to the Free Press’ Stephen Henderson. The Michigan average is 31.
Jan. 1, 2011, Detroit Free Press: In most cities, taxes foot the bill for services, and in the most popular big cities -- Chicago, New York, Los Angeles -- it's common to pay more because of the amenities and social and cultural benefits of city life.

But in Detroit, our extreme tax rates have the opposite effect. Sky-high taxes help drive people and businesses out, yielding less of the revenue needed to deliver quality services, which encourages more people to leave.
Detroit can start by shutting down the health department, since it’s technically no longer allowed to operate one, and shift that burden to the county, where it belongs. From there, Detroit should really take a long look at what aspects of city government exist to service residents and businesses (i.e. police, fire, schools, road crews, lighting) and what exists simply because they exist. Considering Detroit has some 70+ department, bureaus, and commissions, there should be plenty more streamlining and fat cutting opportunities.
The city is running a $155 million deficit. The loss of federal funds and othe tax revenue could be another $289 million. And the schools are more than $300 million in the red.

In short, it's a mess, and getting worse.

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