Detroit - An "Austrian Moment" In The Making

Zerohedge reports:

As Detroit begins to sort through the ill-begotten public liabilities that have driven it to bankruptcy, an important opportunity is at hand to revitalize the city that was once the epicenter of American entrepreneurship and manufacturing, while setting an example for other municipal governments that appear to be headed toward a similar fate. Here is an “Austrian moment” in the making, a potential libertarian awakening guided by the market-oriented, non-interventionist principles of the Austrian school of economics.

For years, Detroit’s expenditures vastly exceeded its revenues. With the tax base eroding, owing to a declining population and diminishing private-sector jobs, efforts to boost revenue by raising taxes would have been futile. (Detroit’s 2012 income-tax rate of 2.45% and its property taxes, which are among the country’s highest, are inexplicable, given the inadequacy of basic public services.) In this context, Detroit’s “Ponzi”-like fiscal situation would have continued to deteriorate, with no options other than to borrow more.