Detroit is no longer an industrial hub, and if it actually falls completely into the crapper (which it won't) there isn't much more harm it can do to our economy than has already occurred with the "Great Recession of 2008."
Let me repeat myself. Detroit has enough of a tax base to pull itself out of the toilet without a bail out. It will require severe austerity measures, and the cooperation of it's citizens to make it work. If they don't cooperate to work it out? That's on them!