Bankruptcy In Detroit Case Study

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Detroit once a vibrant city in the 1950’s has gone bankrupt and has become a place where the standards of living have dropped. Detroit has now become an unsatisfactory place to live, due to things like extreme poverty and pollution. “Today, the boomtown is bust. It is an eerie and angry place of deserted factories and homes and forgotten people. Detroit which once led the nation in home ownership, is now a foreclosure capital.” (LeDuff 5) The main reasons for the decline are the lack of economic diversity, racial tension, unreliable politicians, and the oil crisis. These factors all took major roles in Detroit having to declare bankruptcy in 2013; however even after the obstacles Detroit has had to overcome, it is now back on the path to success. …show more content…

Extreme rates of poverty became a major issue in the city and still continues to be one today. According to the Brookings Institution’s 2010-2014 census data, 40% of the population live below the poverty line, making that the most in one city in the United States. Problems arose like water issues, people were unable to pay their bills, but the city could not afford to pay people to turn off the water supply. With the growing poverty rate, there was also a lot of high school drop outs. The education system is in pieces and continues to have many financial struggles. The have been some actions taken to raise money for the school. Nevertheless, everything from the principles to the teachers needs reform. Detroit’s land also suffered from the urban decay. It was left in ruins when the automotive companies moved out, empty manufacturing buildings and lots of trash from the factories. These sites are an extreme hazard to the people living in Detroit (Thomason 1-4). “The EPA has said that more than 40,000 contaminated parcels have been forfeited to the city for failure to pay taxes.” (Thomason 2) The chemicals are known to cause many health problems such as cancer and asthma. People are debilitated by these health issues and require more medical assistance. This makes it almost impossible those in poverty to make enough money to get themselves out of poverty because of medical costs, and the city in unable to pay for the clean-up because they need to focus in on paying for education and other public services that are necessary in

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