Oct 2, 2006
Foreclosures have more than doubled in the Detroit metro area during January to August 2006 compared with the same period a year ago. In Wayne County, they were up 143%, from 10,348 to 25,179. In neighboring Macomb County, where historically there have been many fewer foreclosures, they rose 234%, from 1,547 to 5,173.
The job cuts in the auto industry over all the years, and the ripple effect they have had in the rest of the Michigan economy, are catching up with people. Businesses that provide services to auto-related companies and their workers have been hit in turn. It’s like a vicious snowball.
Homeowners, who have refinanced and “re-re-financed” their homes and piled up credit card debt, are now reaching the end of the line.
The worst is yet to come, as the results of the latest job cuts by GM, Ford, and Delphi have not really hit yet.
Not long ago, economists were bragging about how the housing market was pulling the economy forward. They forgot to mention that much of that market was based on debt, and they certainly never discussed what would happen when the corporations started axing jobs.
But the mortgage problem is not just a Detroit problem, with its reliance on the auto industry. Across the country as a whole, almost half the value of homes is pledged to pay off debt. This stands as a record since World War II.
The banks today stand ready to swallow up what working people have paid for with their sweat and blood. Under capitalism, decades of hard work and saving are no guarantee of even a home to live in. The only guarantee for workers is in mobilizing their own forces.