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Detroit may hold mother of all garage sales

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With no signs of a federal bailout on the horizon, is Detroit now coming to grips with the harsh realities of bankruptcy after a long and painful history of bad financial management?

Strapped for cash after having juggled the books in every way imaginable, the city may hold the mother of all garage sales to sell, among other things, well, garages.

It is a better alternative that a visit to the neighborhood pawn shop.

Detroit is being urged to look at selling off some of its assets and its nine parking garages, two parking lots and 3,404 parking meters are one of the more attractive options, according to Financial Times.

“It’s one of the easiest assets that someone can underwrite and run more efficiently,” Detroit’s emergency manager Kevyn Orr told the global business news organization.

Detroit does own 22 square miles of property within the city limits, although much of it is blighted and has little value due to an economy on life-support. One exception is Belle Isle, a picturesque island park in the Detroit river, as Financial Times noted.

Apparently, a group of billionaires looking to create a “libertarian city-state” have expressed interest in Belle Isle, but the city has bulked at the idea.

Another possible option is a “fabulous” art collection at the Detroit Institute of Arts. The non-profit group that manages the collection says it is held in public trust, but the state attorney-general has said such assets are “held in public trust for the benefit of the city’s residents.”

And what could be more beneficial than keeping the doors open, although, with it’s track record over the years, residents may want to give no government at all a chance.

If Detroit really wants a federal bailout to avoid dealing with the inconvenient consequences of bad decision making, it should take real steps toward public sector pension reform. Few things will prompt swifter action from President Obama than the need to protect his union comrades.

Read more at Financial Times.

Tom Tillison

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