If only Detroit were a big bank, Treasury officials would be working round the clock this weekend to save it. Alas, this city is no Citi. It lacks a “winning business model” (like lobbying and bonuses for key federal officials). So municipal bankruptcy is on the horizon.
This rise of [robotized manufacturing] violates the deal that the capitalists made with American consumers after the great Depression, which is that they would provide people with well-paying jobs and the workers in turn would buy the commodities the factories produced, in a cycle of consumerism. If the goods can be produced without many workers, and if the workers then end up suffering long-term unemployment (as Detroit does), then who will buy the consumer goods? Capitalism can survive one Detroit, but what if we are heading toward having quite a few of them?