Friday, May 30, 2014

Detroit's Water Revenue Goes Bye Bye

By Douglas V. Gibbs

The world is not static.  Every action creates other actions. . . not always an opposite reaction. Failures, Taxation, and heavy regulation normally causes people trying to survive to head for the hills, or take their business to another State or out of the country.  Once the ball starts rolling, it gets worse, snowballing, until the system reaches full collapse.

Detroit is just about there.

Taxes went up, fees went up, regulations increased, and the entitlement system reached epic proportions.  The wealthy left, the businesses moved out, and those dependent upon the system stayed right where they were at.

The revenue began to dry up as the spending increased.

The failed city lost its luster, began to shrivel under the assault of progressivism, until finally only a few sources of revenue remained. . . and they are getting ready to lose one of those, as well.

Confused about how all of the revenue sources abandoned the city, I am sure the leadership quipped, "Well, at least we've got things like the city's water services that the surrounding cities and counties use.  That will never leave us."


Detroit's financial woes are worsening, and to add insult to injury, the city is losing one of its most reliable sources of revenue: contracts with surrounding communities for the city's water supply.

Detroit will no longer be the middle man in getting water from Lake Huron to neighboring communities.  The world is not static.  Eventually, the market will find a way to create a cheaper, more efficient way.  As Detroit's water system ages, the city of Flint has joined with Genesee County and others to build a $300 million pipeline parallel to an existing one to get water directly from the lake, cutting out the Motor City.

For Detroit, Flint's decision means losing its second-biggest customer and drying out an already-depleted revenue sheet.

Losing Flint and Genesee is expected to force Detroit to take a $22 million-a-year hit.

Like all good liberal left statism-loving people trying to hang on to the last of their money and power, Detroit tried to use the court system to stop the bleeding.  Detroit called the new pipeline a waste of resources and money. The courts disagreed.

The path around Detroit's water will be operational in the spring of 2016.

Detroit was increasing the cost to its customers as its water system became less reliable and older.  Rather than pay more for less, Detroit's customers decided to build their own “for less than the cost of continuing to purchase water from Detroit." An action that was an inevitable response to a liberal action.

The world is not static.

Detroit is the largest municipality to file for bankruptcy in U.S. history, having filed last summer, and they are doing all they can to hang on to what little they have left.  Desperate, the thrashing in the water isn't keeping them afloat, and the last of the revenue is heading for the hills. . . as Detroit shuts down more in-city services, more street lamps, and more police operations.

Detroit remains in talks with three other counties – Oakland, Macomb and Wayne -- to reorganize its water system as a regional operation.

When the price goes up, or the services begin to fail, those counties will be gone, too.

Privatization of the water system has been in the talks, but nothing has materialized.

Trying to convince anyone to take a chance on Detroit has been a tough sell.

After a history of liberal policies, and black nationalism, old habits are hard to break, and unfortunately the city will probably lose what little it has remaining before it has a chance to turn the corner.

Sometimes it takes hitting rock-bottom before an addict can admit their folly, and work to make a change.

-- Political Pistachio Conservative News and Commentary

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