The New York Times > National > Shrinking, Detroit Faces Fiscal Nightmare

The bigger issue is state-wide and in the Michigan constitution. Local gevernment is inherently inefficient in Michigan and unable to adapt very well. It should also be said that the financial crisis is a longtime coming. Between the charter townships, counties, school districts, etc, there are too many layers.

Most importantly, a city like Detroit needs immigrants. The people most likely to live in urban cores are recent immigrants. They bring life and energy to cities. Loft apartments with post-college folks and empty nesters have a place, but immigrants make cities livable. Detroit's most thriving parts of town are based on immigrants (although some of the immigrants come from Oakland county), like Mexicantown. More immigrants might help Detroit, but there are some more systemic problems to deal with.