By David Cruz
Correspondent
Detroit and Atlantic City would seem to have little in common. One is a 680,000 person former industrial powerhouse that put America on the road. The other a 35,000 person former Shangri-La on the Jersey Shore. But today, these two cities share something else — a reliance on a single industry that pushed Detroit into municipal bankruptcy and left Atlantic City on the brink.
In 1978, with Atlantic City’s summer resort days behind it, Gov. Brendan Byrne introduced casino gaming in the hopes that gamblers from around the country would find the city a perfect place to try their luck. For residents, good-paying jobs at casinos and hotels. For city government, tax dollars the likes of which they’d never seen. But, like Detroit’s auto industry, which saw its 300,000 jobs shrink to around 30,000, casinos here are closing, one after the other, four so far this year, in a dizzying market correction that has set off alarms across the state.
“The impact has been savage on Atlantic City government and its people with a tremendous loss in its tax base, which declined in tandem with casino revenues. The closings and consolidation of casinos and resulting job losses have been painful,” said Gov. Chris Christie recently.
Almost 10,000 jobs lost, the city’s unemployment rate above 12 percent. But the impact on the city’s ability to provide basic services — schools, public safety, garbage pickup — has also been crippled. In the past decade, Atlantic City’s tax base has shrunk by half, real estate taxes up over 50 percent and the industry shrunken from a peak of $5.2 billion.
“We got down to a $2.5 billion [gaming] market and we have a government that was living off of a $5.2 billion market,” noted Senate President Steve Sweeney. “It’s not too hard. It’s simple math.”
Detroit emerged from bankruptcy just last week, after a convulsive year of cuts to city services, debt restructuring and crippling tax hikes, brought on by the near collapse of its main industry. It’s a cautionary tale the governor tells over and over, referring to the Detroit bankruptcy at many of his town hall meetings and speeches.
“Just because we’re a Jersey Shore town, we’re still a city and we can be a great city,” added Atlantic City Mayor Don Guardian, “but we need to expand just like every other city.”
So far, city leaders have dismissed the idea of a bankruptcy here. They say they have a plan to stop the bleeding and while the medicine — cuts, cuts and more cuts — will be tough to swallow, holding your breath and praying for a good summer is not a viable alternative.