May 16, 2023
Wisconsin lawmakers will soon vote on a plan to bail out the City of Milwaukee.
It would allow Milwaukee to create a special 2% sales tax to help with its unfunded pension liability.
Lawmakers say the alternative means Milwaukee will go bankrupt, just like Detroit did in 2013, which they say would be devastating for the entire state.
Well, we checked to see what happened to Michigan after Detroit’s bankruptcy.
No loss of industry, no loss of population, and no impact on its credit rating.
James Hohman of the Mackinac center says there’s no reason to think there would be any impact to Wisconsin’s credit rating either if Milwaukee declared bankruptcy.
“I just don’t see a lot of reasons why letting the city government resolve its own debt would reflect poorly on the State of Wisconsin to pay off its debt,” Hohman explained in a recent episode of the MacIver Newsmakers Podcast.
Suddenly, Milwaukee’s self-made financial problems might seem a lot less urgent to the rest of the state.