DETROIT MUNICIPALITY FILES BANKRUPTCY ? IS IT A RIGHT SIGN FOR THE AMERICAN ECONOMY ?

 

 DETROIT MUNICIPALITY FILES BANKRUPTCY . IS IT A RIGHT SIGN FOR THE AMERICAN ECONOMY ?

Detroit  filed the largest municipal bankruptcy in US history on Thursday, setting the stage for a costly court battle with creditors and opening a new chapter in the long struggle to revive the city that was the cradle of the American auto industry.

The bankruptcy, if approved by a federal judge, would force Detroit's thousands of creditors into negotiations with the city's Emergency Manager Kevyn Orr to resolve an estimated $18.5 billion in debt that has crippled Michigan's largest city.

Snyder named Orr in March to tackle the city's spiraling long-term debt, which is estimated at $18.5 billion.

A White House spokeswoman said Democratic US President Barack Obama and his senior team were monitoring the situation in Detroit closely. But unlike after the economic collapse of 2008, in which the federal government injected billions in cash into US auto makers General  Motors Co and Chrysler    as the first step of a quick turn through a managed bankruptcy process, Obama made no promises this time.

There is an urgent need to prevent the auto manufacturers to move their facility to China and India on the pretext of costing!

The American government should come forward to offer lot of subsidies , tax cuts , loans for revival of the auto industries in Detroit . Else , the Detroit catastrophe can happen to  other American cities also.

This shows government inaction in case of a Crisis . Will the American government  wake up now and act ?

Let us Elect Madam Hillary Clinton to prevent this type  of collapses in the future.