Detroit City Files for Biggest US City Bankruptcy

{{Detroit has become the largest city in United States history to file for bankruptcy after decades of decline and mismanagement rendered the city insolvent.}}

Michigan’s governor, Rick Snyder, said on Thursday that there was no other option to tackle the city’s $18.5bn of debts.

“This is a situation that’s been 60 years in the making in terms of the decline of Detroit. From a financial point of view, let me be blunt, Detroit is broke,” Snyder said in a video on the state’s official website.

Once the fourth largest city in the US, Detroit’s population has shrunk from 1.8 million in 1950 to 685,000 today – as crime, flight to the suburbs and the decline of the car-making industry ate away at its foundations and finances.

“The fiscal realities confronting Detroit have been ignored for too long,” Snyder said in a statement accompanying the bankruptcy file.

“I’m making this tough decision so the people of Detroit will have the basic services they deserve and so we can start to put Detroit on a solid financial footing.

“The only feasible path to a stable and solid Detroit is to file for bankruptcy protection.”

However, the filing puts the city on an uncertain course that could mean laying off municipal employees, selling assets and scaling back already threadbare basic services.

{aljazeera}