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By Capitalist (anonymous) | Posted August 01, 2013 at 10:58:14
"It's hard to say which way causality flows between Detroit's poor financials and high taxes (it probably flows in both ways). When revenue is down (due to fewer employers, lower property values, etc.), the municipality has to raise tax rates to capture enough money to function."
Or they can find a way to improve productivity of municipal operations to ensure competitiveness (kind of like what private businesses have to do to ensure survival). This is where unions and other special interests can make the process difficult. As a result business and residents flee to neighbouring jurisdictions.
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