Biden says U.S. looking at Detroit situation closely
July 19th, 2013
03:13 PM ET
1 year ago

Biden says U.S. looking at Detroit situation closely

(CNN) - The Obama administration is looking closely at the bankruptcy of Detroit, but there is no indication yet that it might intervene.

Vice President Joe Biden, asked about it by a reporter on Friday, said the matter was being reviewed but less clear was whether action would follow.

"Can we help Detroit? We are now going through in exactly in detail. We had a meeting yesterday just getting a brief on the status. The question is we don't know at this point," Biden said.

It's unclear what the steps the government would or could take to address the largest municipal bankruptcy in U.S. history.

Once an American economic powerhouse, Detroit has for years borrowed heavily to pay its bills while its population - along with its tax base - sharply declined.

Key issues now involve the potential impact of insolvency on pension benefits for city workers and retirees as well as essential public services.

In addition, there is the question of whether a bankrupt major U.S. city could hurt the ability of other communities to borrow money for capital projects through the municipal bond market.

The federal government intervened with loan financing to prevent New York City's bankruptcy in the 1970s.

The Bush and Obama administrations approved government grants and loans as part of a bailout of Detroit automakers General Motors and Chrysler in 2009.

Those were private companies that also restructured in bankruptcy, shedding assets and jobs but eventually returning to profitability.

President Barack Obama trumpeted the auto industry's resurgence during his re-election campaign.


Filed under: Joe Biden • Michigan
soundoff (17 Responses)
  1. Fair is Fair

    Why is Detroit bankrupt? I thought Obama saved Detroit. Oh wait...

    July 19, 2013 03:21 pm at 3:21 pm |
  2. Ed1

    I know the Unions had nothing to do with this ya right why are tax dollars wasted on Unions there in with the Federal Government this needs to stop.

    Biden you still don't have a clue do you.

    July 19, 2013 03:23 pm at 3:23 pm |
  3. Jeff

    Just how many times are we going to bail Detroit out!!!

    July 19, 2013 03:27 pm at 3:27 pm |
  4. just sayin

    demorcats and unions destroyed it. tax them all $10,000 each to pay for it. it is the only way to cure their liberal brain disease.

    July 19, 2013 03:37 pm at 3:37 pm |
  5. it must be said

    Of course Obama will bail out Detroit. Do you honestly expect him to let his union supporters take the hit for their driving the city into bankruptcy? Of course not. WE WILL ALL HAVE TO PAY so the unions can maintain the pensions that the DEMOCRATS gave them.

    Frankly, the Democrat Party should be prosecuted under the RICO racketeering laws. They are an ongoing criminal enterprise just like the mob. They are just as bad, if not worse, than the mafia.

    July 19, 2013 03:42 pm at 3:42 pm |
  6. Rudy NYC

    Fair is Fair

    Why is Detroit bankrupt? I thought Obama saved Detroit. Oh wait...
    -----------------
    Blame it on the state appointed emergency manager. He was the last one to hold the hot potato.

    July 19, 2013 03:43 pm at 3:43 pm |
  7. Jean

    Very interesting that the problems facing Detroit, as well as the cities in Califoirnia that have already declared bankruptcy and California itself, stem from the huge debt racked up due to unbelievably liberal union deals. Democrats have always played up to the unions and when they are in office the Dems pile on the benefits for the unions who bascially keep the Dems in power in many cities (can anyone say New york City). No one to blame but democrats and unions for the mess Detroit, and California, are in.

    July 19, 2013 03:53 pm at 3:53 pm |
  8. Gunderson

    Humm,
    Gunderson look too. Look like Romney waz correct. It back to Salt Mines and Chicken Feed! And Puitin Care! Man Fire Hoses everybody!

    July 19, 2013 03:55 pm at 3:55 pm |
  9. Larry in Houston

    Joe's doing What ? ""Looking at Detroit"" ? LOL – he needs to be "looking at" Obama – I mean the first 4 years he was advising Obama. Now, Obama is in over his head, especially when he was talking about the TM & GZ case – That's not a Federal Case – It's on a local level – Now, it's back in the top news again, He should have kept his Mouth shut. Instead, he made that speech in the W.H. and Now the Whole Nation is re-living the TM & GZ Case !! That's ridiculous ! Where is Joe ? Is he in Delaware ? Is He in Scranton ? Or is he on the Subway ?? I mean, Where's JOE ?? LOL – no wonder this country is where it is – pitiful, I tell ya, Pitiful. Well, I guess that's what you have, when you've got somebody on the Job, working for you, without no experience. I guess it was either McCain, who wanted to start WW3 or we get the in-experienced one.

    July 19, 2013 03:57 pm at 3:57 pm |
  10. Dutch/Bad Newz, VA -aka- Take Back The House -aka- No Redemption Votes

    Fair is Fair
    Why is Detroit bankrupt? I thought Obama saved Detroit. Oh wait...
    -------------------------------------------
    Failed comment Fair. You can blame the failed appointed emergency manager. Apparently, he's not good at adverting crisis.

    July 19, 2013 03:58 pm at 3:58 pm |
  11. no thanks

    Don't send them money, send them bulldozers. Level the city and start clean. And for God's sake, don't put Democrats in charge again or you will end up with another disaster area.

    July 19, 2013 04:04 pm at 4:04 pm |
  12. just sayin

    Rudy NYC
    Fair is Fair
    Why is Detroit bankrupt? I thought Obama saved Detroit. Oh wait...
    -----–
    Blame it on the state appointed emergency manager. He was the last one to hold the hot potato.
    --

    yes, and then blame the firemen that show up to put the fire out because they wer ethe last one to touch it. typical brain dead union logic.

    democrats and unions ran up the $18.5 billion in debt. he was the poor sucker that they conned into helping them fix it. everybody now see how the lefties play you for fools with rudy nycs comment ?

    July 19, 2013 04:11 pm at 4:11 pm |
  13. Larry in Houston

    Hate to be a bearer of bad tidings, but for the people that don't know . . . . . They are making & Building Automobiles In the SOUTH – They have been doing this for Several Years !! The writing has been on the wall in Detroit for several years !! There is Factories that are Building & making Toyotas & ecery other type of car or truck, or SUV in states like Tennessee – Oklahoma / Missouri / Alabama / Texas / And the List Goes ON. They are much better built than anything coming out of Detroit, and last longer. Those people are making 12 bucks an hour, not 36 bucks an hour, and those automobiles have extended warranty's !! Those autos aren't getting "call backs" or where you have to take your car back into the dealer, because of "re-calls" – - LOL if people could not see the writing on the wall, about 12 years ago, they must have been living under a rock.

    July 19, 2013 04:20 pm at 4:20 pm |
  14. Rudy NYC

    just sayin wrote:

    demorcats and unions destroyed it. tax them all $10,000 each to pay for it. it is the only way to cure their liberal brain disease.
    -----------------–
    In its' heyday in the mid-1970s, GM had a 40% US market share with less than 40 consumer models spread across six brand names. By the summer of 2008, GM had less than a 15% US market share with more than 90 consumer models spread across more than a dozen brands. Is that the union's fault?

    July 19, 2013 04:20 pm at 4:20 pm |
  15. rs

    Fair is Fair

    Why is Detroit bankrupt? I thought Obama saved Detroit. Oh wait...
    _____________________________________
    Romney: "I'd let GM go bankrupt."
    And all the thousands of jobs, not only at GM, but at it suppliers would have hit Detroit a year ago. How might THAT have affected things genius?

    July 19, 2013 04:21 pm at 4:21 pm |
  16. Coming to a Country Near You

    How is Detriot any different than the federal governemnt? It isn't. There is a day of reckoning in the future of everybody or any government that acts irresponsibly and follows the path of take it all and spend it liberalism. You simply cannot keep promising everything to everybody forever and not expect it to catch up with you. Any the brain dead left thinks they can live this way. To them it is all about take, take, take with complete disregard for the host they are sucking dry. In this case, Detriot.

    July 19, 2013 04:40 pm at 4:40 pm |
  17. tom l.

    I won't blame Obama for Detroit going bankrupt. It's pretty easy who is to blame. Let's see, a democrat has been Mayor of Detroit since 1962 – zero republican mayors. Oh, and their city council had 9 democrats out of 9 until 2 had to resign. That is who is to blame. Pretty easy.

    July 19, 2013 04:45 pm at 4:45 pm |