The Blue States Eat Themselves

Detroit Seizes Homes to Fund Corruption

Detroit is foreclosing on tens of thousands of homes — in order to pay for an unaffordable city government that fails the essential tests of governance. The NYT reports that the city is seizing the homes of residents who failed to pay property taxes, and putting some of the houses up for public auction:

Michigan in 1999 changed the way its local governments deal with people who fail to pay their property taxes, replacing a system of tax liens with foreclosure. Yet the number of foreclosures did not reach what advocates here view as a crisis level until years later, when the national recession hastened the city’s problems with blighted properties and population decline. By last year, at least 70,000 foreclosures had taken place here since 2009, not for unpaid mortgages but for failure to pay property taxes.

Of the 62,000 city properties subject to foreclosure this year, more than half are believed to be occupied; nearly 13,000 are probably vacant lots. Some portion of the properties facing foreclosure were also eligible for it a year ago or more, but officials had delayed pursuing them in part because the numbers had grown too large for county workers to handle so many proceedings.

This story shows just how bankrupt the Great Society model of urban governance has become. These property taxes are themselves exorbitant, and the structure they help pay for is an unsustainable system of unionized employees. Since the 1960s, Democrats have supported a model that, at its worst, is characterized by corrupt political machines that rule in de facto single-party urban enclaves. They are propped up by state and federal subsidies and show little to no interest in effective management, economically sustainable development policies, anti-corruption efforts, or school performance.

Now, the sinkhole of corruption and dysfunction that is Detroit has become such a crushing burden that it is taking away citizens’ homes. This isn’t to say that there aren’t some individuals in the mix who irresponsibly ignored tax bills from a dysfunctional city. After all, for years Detroit neither earned the money by providing good services nor had the administrative ability to collect on its bills. But there are plenty of other people whose prospects for jobs and mobility have been blighted by the city’s failings and who simply cannot pay their own way.

This wasn’t the Great Society that Lyndon Johnson had in mind, but it is the society that Detroit and New Orleans, among others, have today. And things could get worse. The financial pressures on the city will intensify as the pension squeeze continues and as the unions fight harder to protect their privileges. Meanwhile, in too many places, single-party political machines will continue to focus on cronyism and identity politics without thinking hard about the urgent economic tasks city governments need to perform.