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I'm not the guy who can go too much in detail about this but I just want give you the gist of the story. Detroit has been a keypoint of Obama's economic recovery used for the stump. But now it's on the verge of being appointed a financial manager from Rick Snyder.

Detroit Free Republic

Jack Martin, the city’s new chief financial officer, said the city will be broke by June 15 but should be able to make payroll for its employees. He said the city will be operating in a deficit situation if the state withholds payments on a portion of the $80 million in bond money needed to help keep the city afloat.

The battle ultimately could lead to an emergency manager if state officials deem the city to be in violation of the consent agreement that gives the state significant control over Detroit’s finances.

But it looks like Michigan is not giving them the revenue they were promised.
Crittendon filed a lawsuit last week saying that the consent agreement was “void and unenforceable” because Michigan owes the city $224 million in revenue sharing plus more than $1 million in unpaid water bills, parking tickets and other debts. Under the city charter, Detroit can’t enter into contracts with entities in default to the city, so Crittendon challenged the consent agreement under her authority to investigate violations of the charter.

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Comment Preferences

  •  I have a lot of questions about these (8+ / 0-)

    "emergency manager" scenarios which basically overturn elections and put one guy in charge.

    For some reason, I am starting to associate emergency managers with dissolving unions and privatizing public resources and assets like water systems. I'm sure charter schools must be in there also as part of the plan.

    Oh. Here's why I am getting those impressions:

    Michigans Emergency Manager Laws Are Dismantling Democracy From Within

    While the United States has in general been a perpetrator of disaster capitalism upon developing nations, Michigan has emerged has a virtual laboratory for the application of the shock doctrine domestically.  The shock they exploit in Michigan is the financial crisis that has hit many American cities and school districts. The governor appoints a single individual to oversee entire cities deemed to be in financial distress, usurping the power of local elected authorities. These individuals, like dictators, have free reign to break contracts with unions and others, sell off public property, and privatize services.

    Some of the people behind Michigan’s disaster capitalism have been in the news a great deal lately. The American Legislative Executive Committee (ALEC) has been invested in Michigan’s Emergency Manager Laws in a number of ways. Members of ALEC, like the Mackinac Center for Public Policy, have been advocating the Emergency Manager Laws for decades, and they were heavily invested in Public Law 4, which is the current form of the EM laws. Not surprisingly, the Koch brothers have funded the Mackinac Center. Their free-market platform is to see government services privatized. The current emergency manager for the city of Pontiac, MI is Larry Schimmel, who happens to be a former scholar and director of municipal finance at the Mackinac Center. He is putting his privatization ideology into practice in Pontiac, after doing it in Hamtramck, MI with poor results.

    Mother Jones: Michigan's Hostile TakeOver
    Gov. Rick Snyder put Louis Schimmel in charge of Pontiac last September, invoking Public Act 4, a recent law that lets the governor name appointees to take over financially troubled cities and enact drastic austerity measures. Under the law, passed last March, these emergency managers can nullify labor contracts, privatize public services, sell off city property, and even dismiss elected officials.

    Schimmel got to work quickly, firing the city clerk, city attorney, and director of public works and outsourcing several city departments. City fire fighters were told that they would be fired if their department was not absorbed by Waterford Township's. Schimmel has proposed putting nearly every city property up for sale, including city hall, the police station, fire stations, water-pumping stations, the library, the golf course, and two cemeteries.

    Williams and his six colleagues on city council have been stripped of their salary and official powers. "Nearly the whole city has been privatized," he laments.

    “Human kindness has never weakened the stamina or softened the fiber of a free people. A nation does not have to be cruel to be tough.” FDR

    by Phoebe Loosinhouse on Fri Jun 08, 2012 at 12:57:07 PM PDT

    •  But have you heard anyone, other than Rachel (4+ / 0-)

      Maddow cover this on TV news?  I haven't been watching any lately, but I do remember her being on this story of emergency managers from the very beginning.

      Why aren't all of those freedom loving tea party patriots demanding an end to this?

      "I cannot live without books" -- Thomas Jefferson, 1815

      by Susan Grigsby on Fri Jun 08, 2012 at 01:02:42 PM PDT

      [ Parent ]

      •  Why do the citizens of Michigan put up with this? (3+ / 0-)
        Recommended by:
        Sark Svemes, Susan from 29, jabney

        Like that first article linked to posits - it's a disaster capitalism science project for ALEC and the Koch brothers.

        It's like enabling Mr. Burns to buy Springfield in the Simpsons.

        And no, I haven't heard anyone really covering it.

        I would pretty much guarantee that if you live in one of these places that your cost of living will skyrocket as public services become private profit making ventures. But since taxes will be lowered because it doesn't take much to run a gutted skeletal corpse of a city, the morons will be celebrating their "savings" and not adding up their new user fees and subscriptions and private trash collection, and increased water bill etc.etc. Look Marge, our property tax went down $12.00 - Yipeee!!!

        No cure for stupid and gullible.

        “Human kindness has never weakened the stamina or softened the fiber of a free people. A nation does not have to be cruel to be tough.” FDR

        by Phoebe Loosinhouse on Fri Jun 08, 2012 at 01:15:48 PM PDT

        [ Parent ]

        •  Did democracy work for Detroit? (1+ / 0-)
          Recommended by:
          MGross

          No one's proposing any alternative, and it's not like the democratic process or local democrats have necessarily done Detroit a lot of favors.  

          There's a lot of folks who think it's perfectly ok to run Detroit as if it were a war zone under martial law, especially if they don't live in Detroit.  The emergency manager law isn't too far removed.

          •  Your comment reminds me of one I read (1+ / 0-)
            Recommended by:
            Susan from 29

            on a diary yesterday -

            What happens when a democracy votes against democracy?

            Although it wasn't the people who voted to demolish democracy, it was their representatives.

            I can say honestly that our Democracy doesn't seem to be working too well lately, but most of the time I attribute that to politicians subverting the will of the people.

            When I see polls, I am always relieved to find that my  very liberal (supposedly) views are quite mainstream when people are polled on individual topics. It's the media and the politicians and the Parties that have deserted the people in favor of the corporations and the wealthy, whose taxes they lower even while planning to snatch the ramen right out of the shopping cart of the seniors.

            “Human kindness has never weakened the stamina or softened the fiber of a free people. A nation does not have to be cruel to be tough.” FDR

            by Phoebe Loosinhouse on Fri Jun 08, 2012 at 01:50:51 PM PDT

            [ Parent ]

            •  fusionkaster is under the misapprehension that (1+ / 0-)
              Recommended by:
              phonegery

              they aren't coming for him (or her) as the case may be.  That is why people aren't up in arms--they think this is only going to affect minorities and the poor.  I've got news for you, folks.

              If the plutocrats begin the program, we will end it. -- Eugene Debs.

              by livjack on Fri Jun 08, 2012 at 03:22:03 PM PDT

              [ Parent ]

      •  Thom Hartmann has also covered it and to a (4+ / 0-)

        lesser extent, Ed Schultz. The word they all seem to use is "template" - as in coming to a city near you. As Phoebe L. noted EFMs are just part of the big picture. The selling off of assets feeds right into the privatization/profitization of everything. The description of what is on the block in Pontiac is appalling. In addition, there is the small matter of representation. Voters in all the places that are currently under EFMs chose their elected representatives to be mayors, members of city councils, etc. It is unbelievable that this  hasn't resulted in a Madison-like outcry and occupation. Most people outside of Michigan don't know a damn thing about it.

      •  DKos's own Eclectablog has been (0+ / 0-)

        shouting this from the rooftops and wherever else he can shout it from, and has been credited by Rachel for keeping everyone informed about it.

        Love your comment about the "TP Patriots."

  •  So the state owes Detroit money, is withholding (8+ / 0-)

    the money, so that Detroit is going to not be able to pay its bills, so that the state can appoint an emergency manager who will then make decisions about firing people, invalidating employment contracts and not be accountable?  This is what you're saying?

    If this catches on, it sounds like a perfect thing for other Republican-held states.  Granted, they don't have the emergency manager setup to go to, but I could see them bankrupting cities by strategically withholding funds due.

  •  it's time for an organized call-in to the (1+ / 0-)
    Recommended by:
    northerntier

    media to ask why they are not covering this story!

    we need phone numbers for the national shows that are actually watched - the alphabet soup - and the pbs shows that are credible.

    and, newspapers - talk shows from the left - sirius.

    okay -  let's start a group that gathers phone numbers and contacts in one place to have at the ready for times like this.

    anyone up for it - want to help - or should i do it later this weekend?

  •  If we lived in a rational nation, it would seem (1+ / 0-)
    Recommended by:
    Kickemout

    like the logical and obvious solution would be to levy a tax on the now-quite-profitable auto industry to solve the city's revenue problems. As the auto industry itself was saved from insolvency by government action, it would seem only just that the auto industry should return the favor.

    Unfortunately, we live in an oligarchy where big corporations and very rich individuals can't be taxed. So it goes.

    I support torturous regimes! Also, I kick puppies.

    by eataTREE on Fri Jun 08, 2012 at 01:25:31 PM PDT

  •  Whatever happened to the court action in respect (0+ / 0-)

    of the font size case? IIRC and I may be wrong, MI citizens turned in petitions, and the man on the adjudicative panel who also came from the company which claimed invalidity of the petitions based on bogus font size claims without evidence to back them up, denied the petitions, and the matter was on the way to court. How is that doing?

  •  There is a bit of blackmail going on here..... (4+ / 0-)

    An attorney for the city has filed a lawsuit regarding the Emergency Manager style take-over of Detroit.  That, along with the on-going lawsuits about monies owed to the city by the state has made the Powers in Lansing come forth with:
    "Drop the lawsuits, or we will cancel the promised $80 million and the consent agreement and just send in our EM to run the city." And there is a time limit of something like 48 hours to drop the lawsuits.  (I heard this discussed on Michigan Public Radio today. Surprise! We still get NPR here in Snyderland, but probably not for long)

    "George Washington: "The power under the Constitution will always be in the people.... and whenever it is executed contrary to their interest, or not agreeable to their wishes, their servants can, and undoubtedly will, be recalled." 1787

    by moose67 on Fri Jun 08, 2012 at 01:49:10 PM PDT

  •  I am in favor of this (0+ / 0-)

    after the bankruptcy and the public services privatizations happen, as a robot maker I am very willing to contract with OCP for the little problem they've been having about their police robots not being able to negotiate stairs.

    ... oh wait, this is real life? :(

    I am an electrical engineer, run a reasonably high traffic server, and build autopilots and drones for a living. If you have technical questions, ask away and I will try to give a cogent answer.

    by spiritplumber on Sun Jun 10, 2012 at 11:14:53 PM PDT

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