The Detriot News has published a commentary by Lyndee Kemmet, visiting research fellow. Entitled Detriot Should Avoid Bankruptcy, this article was publised on Wednesday, September 9. Here is a quote from the article:

Stung by the recession, a growing number of local governments are eyeing bankruptcy -- including the Detroit Public Schools and possibly the city of Detroit. Bankruptcy might hold creditors at bay and give a city or other public institution time to reorganize itself, but experience has shown the stigma of bankruptcy takes its toll and should be avoided.

Municipal bankruptcy rose out of the Great Depression when the sinking economy took with it many state and local governments. Unable to pay their debts, local governments lobbied for federal legislation allowing them to file for bankruptcy.

Read the full article.