From Walter Russel Mead at The American Interest, Note to Paul Krugman: It Took More Than Markets to Ruin Detroit:
Krugman is right that Detroit is essentially Ground Zero of the disruptive changes wrought by an economy in transition. But as this story and others like it show, it’s difficult not to conclude that the city is also the victim of rampant fraud and stupidity on the part of an all-Democratic political machine. Officials decided time and again not to fund the promises they made to city pensioners, and feds and regulators just as often declined to do anything about it. If something this egregious and destructive were happening in the private sector, Mr. Krugman would (rightly, in our view) be all over it, demanding that people go to jail and regulations be tightened. He would want to investigate the ties of influence that allowed serious financial wrongdoing to go on for years without serious oversight. He’d name names and pin shame on the wrongdoers and their political allies.
Detroit didn’t just wither in the face of changing economic conditions. It failed to adapt. Motor City is littered with dumb “recovery” ideas like the grandiose and badly named “Renaissance Center” in the dead heart of downtown. Race baiting politics by corrupt hacks who cynically invoked racial stereotypes and stoked hatred to build popular support for criminal rule (a milder, home-grown style of the politics of Robert Mugabe in Zimbabwe) made a bad situation much worse. The soft bigotry of low expectations meant that neither federal nor state prosecutors intervened until very late as the thieves looted the ruins. The civil rights establishment kept its eyes devoutly averted and its lips firmly sealed as a generation of fraudsters ruined the city, wrecked the pension system, turned city administration into a swamp of ineffective and corrupt failure, and denied a generation of schoolchildren any serious educational opportunity.
tips to Instapundit
it is intellectually weak to write off this disaster to the market’s creative destruction of Heilbroner, and ignore the disastrous policies, political corruption, and decades of fraud. Any criticism of this decades old regime and its wasteful projects was demonized as anti union or racist. The true liberals who fought for equality are turning over in their graves seeing their cause used to hide fraud and corruption.