Behind The Mic With Joe Mathieu: Bankrupt Cities And The American Dream
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BOSTON (CBS) – It’s a pretty grim situation in the Motor City. Has been for a long time.
Detroit is steeped in debt – $19 billion worth – and people have been fleeing the city for years.
Companies have left too. In fact, there are so many empty buildings in Detroit you could fit the entire city of Paris inside all that open space.
Just think about that for a minute.
Now you could argue that Detroit’s problems are symbolic of those facing the country with rising debt, jobs shipped overseas and crumbling pensions.
And indeed Detroit may be the biggest but it’s only the latest American city to go bankrupt.
Indeed, there have been 36 municipal bankruptcies in the past five years including one right here in New England – Central Falls, Rhode Island filed for bankruptcy about two years ago.
It’s because of stories like these that people feel the country is on the wrong track.
In fact, there’s a new study just out Friday showing more people think the American Dream is dead.
Forty-two-percent of those surveyed by the Brookings Institution and the Public Religion Research Institute say capitalism is not working. They think it encourages greed.
Now you could argue this is part of the hangover from the Great Recession.
Because when you look inside the report you find the more affluent the person, the more optimistic they are about the economy.
There’s something called the “wealth effect,” which says people feel more positive about their own finances when Wall Street is doing well, as it has been. Makes them feel more comfortable spending money.
People with investments tend to feel the optimism first and historically it spreads to all income levels.
So in this case we hope history repeats itself.
You can follow Joe on Twitter @JoeMathieuWBZ