Meredith Whitney painted a dire picture in a CNBC interview Wednesday of cities slashing services and communities battling for mere survival.
The financial advisor and analyst said the financial woes facing bankrupt Detroit will become common around the country as local governments do whatever they can to escape onerous debt burdens.
"I think you're going to see a real issue of neighbor against neighbor on these very issues," she said during a "Closing Bell" conversation. "That has been glossed over for years. What's at stake are social services we count on."
Two and a half years after Whitney famously—and thus far inaccurately—predicted a rash of devastating municipal bankruptcies, the biggest one in history took place last week.
Detroit has sought Chapter 9 protection after years of struggling to regain its financial footing after the collapse of the auto industry and the financial crisis.
(Read more: Detroit bankruptcy case judge proposes mediator for toughest disputes)