DEINDUSTRIALIZATION—WHICH LED TO THE DRAMATIC REDUCTION OF POPULATION, employment, and retail—devastated America's great manufacturing cities. When the departure of businesses and taxpayers reduced revenue, municipalities struggled to balance budgets, pay their bills, and provide vital services to the shrinking number of inhabitants who remained within city limits. In the worst situations, financial crises forced state governments to take extreme measures to keep these embattled communities solvent. In the most noteworthy example, the state of New York created the Municipal Assistance Corporation in 1975 to install sound budgetary procedures and practices in New York City. Awash in red ink, the nation's premier city wholly ceded the management of its fiscal affairs to an independent entity. Reeling from the decline of the automobile industry, six Michigan cities—Allen Park, Benton Harbor, Detroit, Ecorse, Flint, and Pontiac—surrendered autonomy to emergency managers (appointed by the governor), who took command of local governance. External control of...
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