Why Chicago Won't Go Bankrupt - And Detroit Didn't Have To

Saqib Bhatti In These Times
Detroit's bankruptcy wasn't inevitable. Neither is Chicago's. But the austerity hawks don't want you to know that...When cities and states borrow money by issuing bonds, the lenders are typically high-wealth individuals, who purchase the bonds to get a tax break. It is a perverse system through which, rather than paying their fair share in taxes, the wealthy are instead able to lend that money to us, charge us interest for it, and then claim a further tax break on it.

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Detroit Union Files Challenge to City's Bankruptcy Petition

Joseph Lichterman and Bernie Woodall Reuters
The American Federation of State, County and Municipal Employees Council 25 said Detroit, which last month filed for what would be the largest-ever U.S. municipal bankruptcy, has not proven it is insolvent and has not negotiated in good faith with its creditors. In a filing with the U.S. Bankruptcy Court in Detroit, the union said it was also challenging the constitutionality of Chapter 9 of the federal bankruptcy code, arguing that it encroaches on states' rights.
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