Chris Christie’s takeover of Atlantic City shows the path from debt to despotism.
Atlantic City has a city mayor who was elected by the people. He is still in office. But it is questionable how much power he has now. The state executive is taking over the city. Reportedly, “officials stopped short” of calling it a “takeover,” but Newser.com uses that terminology and so did a headline at NJ.com, until word “takeover” was replaced with “emergency plan.” Perhaps all such references will be scrubbed soon.
But the lesson of this story is that debt means you lose your representative government.
Gov. Chris Christie announced today that he’s signed an executive order to install an emergency management team to help revive financially strapped Atlantic City and dig the gambling resort out of “an enormous hole.”
Christie tapped Kevin Lavin, a corporate finance attorney who specializes in helping troubled companies, to overhaul the daily operations and finances of the city, which has seen four casinos close and more than 8,000 people lose their jobs over the last year.
The Republican governor also named Kevyn Orr, a former corporate bankruptcy lawyer who led Detroit through the largest municipal bankruptcy filing in U.S. history last year, as a special counsel to Lavin.
“I can’t wait any longer,” Christie said while making the announcement at the third summit he has held in Atlantic City with casino executives, business leaders, union leaders, and state and local officials to search for ways to revitalize the city. “We need more aggressive action. It’s time to confront the dire circumstances with which we are confronted.”
The fact that Christie is naming someone associated with the bankruptcy of Detroit and the threatening of pensions sounds dire for Atlantic City, even though everyone is insisting that it is “too early to speculate” if the city will also go into bankruptcy.
The city council President, Frank Gilliam, was not happy at all!
“I don’t believe it’s necessary,” said Gilliam, a Democrat. “I find it very imposing that we will basically have outsiders come into the city and dictate the direction of the city without sitting down with the city fathers and getting their input. We’re open to working with them. But at the same time, any time that they usurp our power, we will definitely have problems with that.”
So what happens when this occurs in ten cities? Or a hundred?
This story shows the folly of the state more or less sponsoring and depending upon certain industries. The New Jersey government is basically dependent on people being stupid and going to casinos. It also shows the inherent immorality of public debt. When the people elect rulers who go into debt, those rulers are basically announcing that the government is for sale. If they get over their heads they will have to put the government in hock.
Thus, debt leads to despotism—the takeover of the government by unelected “emergency management.”
Coming soon to country near you!