Pat Buchanan

San Bernardino, Calif., has now followed Stockton into bankruptcy.

Harrisburg and Scranton, Pa., and Jefferson County, Ala., home to Birmingham, are already there to welcome them.

Detroit has been taken into receivership by Michigan. A plan under discussion is to level a fourth of the city and reconvert it into the pasture and farmland it used to be a century ago.

On the Web, one may find a pictorial tale of two cities: Hiroshima, a smoking flattened ruin in 1945, now a beautiful gleaming metropolis. And Detroit, forge and furnace of democracy in 1945, today resembling Dresden after Bomber Command paid its visit.

Other American cities are exploring bankruptcy to escape from under the mountain of debt they have amassed or to get out of contracts that an earlier generation of politicians negotiated.

No longer shameful, bankruptcy is now seen as an option for U.S. cities. The crisis of the public sector has come to River City.

What happened to us?

In the Reagan-Clinton prosperity, officials earned popularity by making commitments that could be met only if the good times lasted forever. They added new beneficiaries to old programs and launched new ones. They hired more bureaucrats, aides, teachers, firemen, cops.

Government's share of the labor force soared to 22.5 million. This is almost three times the number in the public sector when JFK took the oath of office. These employees were guaranteed job security and high salaries, given subsidized health care, and promised early retirement and pensions that the private sector could not match.

The balance between the private and public sectors shifted. As a share of the U.S. population, the number of taxpayers fell, as tax consumers -- the beneficiaries of government programs and government employees who run those programs -- rose.

The top 1 percent now pays 40 percent of the income tax. The top 10 percent pays 70 percent. The bottom half, scores of millions of workers, pay nothing. They ride free.

This could not go on forever. And when something cannot go on forever it will, by Stein's Law, stop. The Great Recession brought it to a stop. We have come to the end of the line.

U.S. cities depend on property and sales taxes. But property tax revenue has fallen with the collapse of the housing market. Sales tax revenue has fallen as a result of the recession that has kept the consumers out of the malls.


Pat Buchanan

Pat Buchanan is a founding editor of The American Conservative magazine, and the author of many books including State of Emergency: The Third World Invasion and Conquest of America .
 
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