by Investor’s Business Daily

Fiscal Disaster: A major credit rating agency has just given Chicago, with more general obligation debt per capita than Detroit, its second triple-notch downgrade in six months. Its bonds are perilously close to junk status.

Citing skyrocketing pension costs and a lack of meaningful solutions, Fitch Ratings lowered Chicago’s debt to A- from AA- last week, making it the second serious downgrade since July.

The move by Fitch follows a triple downgrade of Chicago’s bond rating by Moody’s Investors in mid-July.

Moody’s cited the city’s “very large and growing” pension liabilities and “significant” debt service payments, among other factors.

The steady financial decline of the nation’s third-largest city prompted us in early August to say Chicago was well on its way to becoming the next Detroit, a bankrupt monument to the perils of Democratic governance, a one-party Democratic town in arguably the bluest of blue states. And Chicago’s mayor, former White House Chief of Staff Rahm Emanuel, learned financial discipline at the feet of the master — President Obama.

Like the president, Emanuel could claim he inherited the city’s financial mess from his predecessor, but that would require blaming another Democratic mayor, Richard M. Daley.

Interestingly, Democratic governance is a common thread running through America’s urban problems.

As the Chicago Tribune noted in its recent report on the problem, “Broken Bonds,” Chicago’s outstanding debt on general obligation bonds has quadrupled during the past 18 years, reaching $7.2 billion last year.

With interest, that amount nearly doubles. The city has more general obligation debt per capita than any of the 10 largest U.S. cities except New York.

The Tribune noted that Chicago leaders have routinely used bond proceeds to make interest payments on the bonds themselves, borrowing more than $450 million since 2000 just to pay interest. Some 63% of all property taxes went to debt payments last year.

A large part of Chicago’s problem — the game of maintaining standing armies of campaign workers by overpromising and underfunding pensions — is now over.

Illinois as a whole has a huge ticking public-pension time bomb and an unwillingness to take on the unions, as Republican Gov. Scott Walker did in Wisconsin.

As Fitch analyst Arlene Bohner says, Chicago is approaching an “inflection point where inaction on pension reform will negatively impact the city’s finances and threaten to crowd out spending on city services.”

Ted Dabrowski, vice president of policy at the Illinois Policy Institute, notes Chicago has already shuttered nearly 50 schools in its public schools system and, rather than hiring more police to battle crime, the city is paying overtime for existing officers.

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Correction: A previous version of this article incorrectly referred to Richard M. Daley as Richard J. Daley.