The Washington Times - July 24, 2013, 01:57PM

Warning the federal government is broke, Sen. Lindsey Graham of South Carolina said Wednesday that he is pushing a proposal that would block lawmakers from approving a bailout for Detroit.

“Should the federal government bail out Detroit? No way. No how,” Mr. Graham said. “There is no doubt Detroit has huge problems, but they are facing problems of their own making. Detroit and other municipalities facing these issues need to get their own financial houses in order.”


The notion of another bailout is unpopular on Capitol Hill, where lawmakers are still reeling from the controversial bailouts of Wall Street and mortgage giants Fannie Mae and Freddie Mac.

Some, though, have made the case that the federal government should step in and give Detroit a financial lift, including Steven Rattner, the Obama administration’s former “car czar.”

“No one likes bailouts or the prospect of rewarding Detroit’s historic fiscal mismanagement,” Mr. Rattner wrote last week in The New York Times. “But apart from voting in elections, the 700,000 remaining residents of the Motor City are no more responsible for Detroit’s problems than were the victims of Hurricane Sandy for theirs, and eventually Congress decided to help them.”

Detroit filed for Chapter 9 bankruptcy protection in federal court last week, becoming the largest U.S. city ever to take that action.

Mr. Graham said that federal government is in no position to rescue the city when the national debt is racing toward $17 trillion.

“The federal government is beyond broke,” Mr. Graham said. “The last thing we need is the broke bailing out the broke. Taking on financial obligations which can be handled at the state and local level is a very bad idea.”