Debt and defiance in bankrupt Stockton, California


Stockton, California has been forced to slash its police force even as crime rates have soared in formerly middle-class areas

From behind the wheel of her black and white patrol car, Sgt Katherine Nance points out a modest house behind a white picket fence.

It was built by her parents, and was where she grew up until she was a young teenager. "It was a good middle-class area," she says wistfully.

She says she rode around on her bike, babysat for the neighbours. Now the local park has become a haven for drug-dealers and a venue for gun fights. You wouldn't let a child walk around here, even during the day.

You might think this is the sort of change has come to many areas, and that it has been happening for years, all across America, for many reasons. Maybe.

But Stockton is part of a new trend: American cities that have gone broke and declared themselves bankrupt.

For Sergeant Nance, crime has spiralled upwards and her old neighbourhood spiralled downwards because of bad choices made by politicians. While you can't get away with murder in Stockton, it sometimes seems to residents you can get away with everything else.

'Most miserable city'

The former river port bloomed during California's first boom, the 19th Century gold rush, and Stockton has seen ups and downs over the years. But the recent economic crisis seemed to change everything.

Stockton recently became the largest city in the US to declare bankruptcy, but along the road to ruin also earned the title of "America's most miserable city".

The marina in Stockton, California Stockton is a city of contrasts - from an empty and boarded-up Main Street to a gleaming marina

Stockton has an unemployment rate twice the national average and jostles with many other places for the unenviable sobriquet of "America's murder capital".

Amid all these problems, it is crime and the sense of growing vulnerability that dominates the conversation of locals.

Sgt Nance clearly relishes her job as leader of a community response team. Their main role seems to be to disrupt the many gangs battling it out for control of the city streets.

We hear sirens nearby. Then she gets a message that her colleagues, in an unmarked vehicle, are in hot pursuit.

When we get there a young man with a wispy moustache and a sullen look is sitting handcuffed. He had accelerated away when they tried to stop him for speeding.

When they do stop him, a search reveals several bags of marijuana, a small rock of crack cocaine and a semi-automatic pistol.

There aren't as many officers on the streets as there once were. Police numbers have been cut by one-third, and police pay has been cut by up to 30%, those with the longest service losing the most.

Not surprisingly many officers have left. But it's not only that.

Stockton Mayor Ann Johnston appears for a meeting of the city council 26 June 2012 Stockton Mayor Ann Johnson says the city will rise again

The city can't afford to prosecute many offences. Many of those arrested have been let out of jail early. Sgt Nance feels this failure to disrupt petty crime often means criminals are at large, able to do something more serious.

Residents complain that the police won't investigate house burglaries and car thefts.

She agrees that for the most part, they don't have the resources to follow-up.

Many of the areas where I am taken don't look particularly bad: just row of after row of shotgun housing, some cared for with loving pride, others more dilapidated.

But Stockton is a city of very visible contrasts. Main Street is a horror: there are whole rows of boarded-up shops, and doors behind heavy bars and grills, pad-locked shut.

It is empty except for the occasional homeless man or woman walking nonchalantly down the street, clutching everything they own.

Less than a mile away, by the waterfront, multi-million dollar yachts idle in the marina, gleaming white, shaded from the sun by rows of white canvas awnings, the very picture of California dreaming.

But the half-empty marina has turned out to be a bit of a nightmare for Stockton.

Like the city's other prestigious projects - the ballpark, a sports stadium and hotels - what once must have seemed like smart regeneration turned out to be a pointless burden as the recession hit home.

Equally, what once seemed like decent treatment for city workers, i.e. generous health care, pensions and pay, particularly for firefighters and police, is now seen as absurd featherbedding.

Lost benefits

I meet the mayor, Ann Johnston, in her balloon shop. We can't go to city hall; it is closed one day a week to save money.

She says Stockton suffered from a perfect storm. These big projects left the city with no money in the bank, and borrowing expanded. Then the recession struck.

All of the city's money comes from property tax, and as property prices went into freefall, the local government's income was slashed.

A vacant home has weeds growing in the gutters in the Weston Ranch neighbourhood of Stockton, California in this 6 March 2012 One in every 195 Stockton homes filed for foreclosure in May

She says Stockton's latest dramatic move is the solution, not the problem.

Nothing changed the day after the city declared itself bankrupt. Stockton hasn't shut its doors and isn't giving up.

Indeed the bankruptcy is a device to avoid paying creditors and to avoid making even deeper cuts. But many are furious about what has happened. The mayor has faced an angry public meeting where city workers testified to the suffering caused by inept politicians.

She says the city will rise again, but Joanie Anderson is less sure.

Anderson is a former police dispatcher, and her husband used to be a policeman. They are both retired, but as they are well under 65, they rely on the city for their health insurance.

It is hugely important to them, but now their programme has been cut from the city budget.

"Our 18-year-old daughter has had four open heart surgeries since birth," she said. "Her last one was this February."

"So she has ongoing health needs that have to be put to the forefront in our family. If she has an emergency that involves her heart, it costs tens of thousands of dollars in the hospital."

But it would cost them $34,000 (£22,000) to replace their healthcare, if indeed any insurance company would take them on. They simply can not afford it and have no idea what to do.

Other city workers may have less dramatic stories, but find themselves in the same plight - they thought they had excellent healthcare, and now find themselves with none.

Stockton's descent into insecurity is chilling because it is not an isolated example.

As I left the city, news came that another California town, Mammoth Lakes, had filed for bankruptcy. And beyond each individual town, America itself is deep in the red.

Putting that right may mean as many difficult choices and as much pain.

Mark Mardell Article written by Mark Mardell Mark Mardell Presenter, The World This Weekend

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  • rate this

    Comment number 106.

    76:RW93003:Here in Indiana it's 38%. I suspect the difference is that we spend more of our property tax money on our schools.

    81:margaret howard:Fox looked like there were some places for the public to blog for free. So did NBC. If CBS or ABC has one, I couldn't find it.

    86:Phffft:I find the BBC the most unbiased news source to which I have access. Commentary is supposed to be opinionated.

  • rate this

    Comment number 105.

    margaret howard (81),

    “... As I've pointed out before, it's my licence fee that pays for this BBC facility for you to express your opinions in both America and Europe ...”

    As I’ve pointed out before, you are wrong.

    For IP addresses outside of the UK, the city of Stockton would be an example, the BBC pages host advertisements.

    Wrong again Margaret!

  • rate this

    Comment number 104.

    62, 73:margaret howard:We are grateful for anyone opening factories in our country because what we really need right now is jobs.

    Try wikipedia.

    70:Andy Post:Mexico's not a former part of the empire or a member of the commonwealth, which might explain the dearth of stories on it.

    72:under 16 over 16:You definitely don't understand the US.

  • rate this

    Comment number 103.

    54:under 16 over 16:There are ways around the worst effects of poverty in the US if you know where to go. People who have been poor a long time know them; the newly poor have to find them out to survive.

    60:BLUES55:At the moment there is a work shortage. This problem will eventually work itself out. People who harm others end up in jail, even if they're rich, but the rest of us are free.

  • rate this

    Comment number 102.

    1:inacasino:If all the people in the US who can work are employed, we will be able to pay off our debts. If not . . .

    11:SMCharnas:Shortly after Prop 13 was passed, some people in MI wanted to pass the same state legislation. They failed. Some people have common sense and some don't.

    18:windindrygrass:The people who have to sell their houses in order to pay medical bills.

  • Comment number 101.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 100.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 99.

    The US has many problems with gov finances;
    1. Politicains who can not (or refuse to) see the consequences of their policies.
    2. People who want massive gov. services, but refuse to pay for them with taxes.
    3 Too many people with power and no socal conscicous.
    4. Too many people who think any gov serices that help them is necessary, but think all others should be cut.

  • rate this

    Comment number 98.

    Comment number 87.ScottNYC

    What do you expect from the area of the web-site which is about North America? If you do not wanst US news, go the the Asian section.

  • rate this

    Comment number 97.

    We are experiencing an era of hard times. That happens. That happens here in the United States, and in Great Britain. It happens everywhere in the world. And it happens in every century. There are eras when it seems that anything is possible. There are eras when it seems like there's nothing but closed doors and limitations. Although it's difficult to do, it's essential to maintain perspective.

  • rate this

    Comment number 96.

    You think Stockton in the US is in trouble! You should visit Stockton on Tees in the UK. Its one of the most depressing, run-down soul-destroyed place in the country. I should know - come from there. How about a comparison between the Stocktons in the US, UK and Australia? If you need help, contact me through my website

  • rate this

    Comment number 95.

    While this story is accurate, it fails to point out some realities. Stockton spent everything coming in, apparently based upon the assumption that the well could never run dry. When some rain did fall, they "discovered" they didn't have a "rainy-day fund." Their debt is based solely upon decisions they made when times were good, and apparently on one had the sense to say "Shouldn't we save some?

  • Comment number 94.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 93.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 92.

    Mark, as you say, there are many factors contributing to the financial plight of Stockton. Cities and states can’t print money and accumulative debt, along with falling revenue, has real consequences. Stockton can reorganize their debt via bankruptcy; unfortunately, they will have a hard time attracting investors in the future. I suggest a garage sale, followed by a bake sale and car wash.

  • rate this

    Comment number 91.

    81 MH

    Get over yourself, Magaret. There are so many forums you can comment on here that eiher you haven't tried to find any of them or are incapable of finding them. What's more, no one will be reminding you that you have no right to comment--which can only be described as a serous deficiency of your understanding of the world wide web.

  • Comment number 90.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 89.

    85. Trollicus
    Big Business thriving isn't the same as society improving.
    Little people get left behind, but they are growing

  • rate this

    Comment number 88.

    thirty years ago 'illegal immigrants' were the backbone of the californian economy, doing all the crap jobs americans did not want to do, now they are to blame, anyway its goodbye to the american empire, just like rome, domestic issues will bring it all tumbling down, rightly so, poor south america, so much interference for so long from greedy americans, Haiti, a half hour from miami, so poor.

  • rate this

    Comment number 87.

    The BBC's obsession with America and its problems really borders on the psychotic.


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