Skip to main content


What life lessons can hard-working Americans draw from the story of Detroit?

Once a Boom Town; Now a shell of its former shell -- but still a Town with struggling American people, nonetheless ...


Detroit's Bankruptcy Case Starts As Rick Snyder's Influence Hovers

by Micheline Maynard, Contributor -- July 24, 2013

[...]
Now, a Democratic city’s fortunes rest with a Republican governor once more. Only this time, Gov. Rick Snyder appears to be in far more direct control of Detroit than any of his predecessors. Last week, Snyder authorized the city’s Chapter 9 bankruptcy filing, only a few months after he named Kevyn Orr, a Democrat, as the city’s emergency manager.

While Snyder isn’t running the city in any formal sense -- Democrat Dave Bing remains as mayor -- he is far and away the official calling the strategic shots in the direction the city is taking. When the Chapter 9 bankruptcy case officially begins on Wednesday in Detroit, Snyder’s agenda for restructuring the city is expected to be readily apparent in the plans put forth by Orr in federal court.
[...]

The biggest question is whether the state might step in to guarantee pensions for city workers, who do not have the same federal safety net that protects pensions at corporations. There is no requirement that the state do anything about Detroit’s $8 billion pension liability, but it also seems like one of the most logical ways that Michigan could help its ailing urban core.
[...]


See that, hard-working Americans, when your Town falls on hard-times,

you can be sure the masters-of-austerity will be right there "to help you"

-- sell it off, and/or dissolve it, from any financial viability.


Judge: Detroit bankruptcy to proceed; city's health at risk

by Brent Snavely, Matt Helms and Tresa Baldas

Detroit Free Press Staff Writers -- July 24, 2013

[...]
U.S. Bankruptcy Judge Steven Rhodes dealt back-to-back wins for emergency manager Kevyn Orr in rulings shortly after a two-hour hearing in a courthouse packed with about 175 lawyers, journalists, city workers and retirees.

Saying the city would suffer irreparable harm if delays to its bankruptcy were upheld, Rhodes denied attempts by lawyers for pension funds, unions and other creditors to halt Detroit’s Chapter 9 filing while the matter is being taken up by state courts in Michigan.
[...]

I’m mad!” said Belinda Myers-Florence, a City of Detroit retiree who attended the hearing. “I worked in the city for 35 years, and now you’re gonna tell me I don’t have a pension?”
[...]


I'd be mad too.  35 years of hard work, and not even a gold watch.

So much for the Constitutional mandate of "providing for the general welfare" ... if only those Retirees had a Lobbyist, to speak for them ...




Well, not exactly a Lobbyist for the People -- but here's kind of the next best thing:


Unions Press White House, Congress to Aid Detroit

by Melanie Trottman blogs.wsj.com -- July 26, 2013, 9:21 AM

[...]
The AFL-CIO  issued a statement Thursday night that called on President Barack Obama and Congressto commit to an immediate infusion of federal assistance for Detroit, and to demand” it be matched by the state of Michigan.

The group, which is the largest union federation in the nation, said retirees put in decades of service to earn “a modest pension of about $19,000″ a year, and alleged ”it is not only illegal but morally wrong to attack Detroit’s seniors.”
[...]

The city’s current workers and retirees “are not responsible for the city’s economic state” but their retirement plans are “likely to be pilfered to pay Wall Street firms as bondholders in bankruptcy,” the AFL-CIO says.
[...]

Well those "bondholders" are supposed to "get cuts" to be the first in line ... when assets get "re-allocated" in America, don't you know. It's just part of their "Social Contract."


NOW if only hard-working American Retirees had a seat on Stock Market Exchange, like them ...

Well then, Congress would be all-over the problem of those "Bad Pension Debts."

They'd be falling all-over themselves to pay them off, like always they have before:


The Real Size of the Bailout

by Nomi Prins, motherjones.com -- January/February 2010 Issue

The price tag for the Wall Street bailout is often put at $700 billion -- the size of the Troubled Assets Relief Program. But TARP is just the tip of the iceberg of money paid out or set aside by the Treasury Department and Federal Reserve. [...]

(Figures current as of October 31, 2009. Click here for an explanation of the abbreviations and programs below.)


[Bailout Image without the annoying annotation.]

See that tiny red box, I added to the Bailout graphic?  THAT is the size of the Detroit Pensions liabilities, amidst an unending sea of congressional-approved Wall Street charity.

A tiny red speck of a problem -- that apparently Congress is NOT going to lift a finger to do anything about ... except to explicitly BLOCK any efforts to Bailout the speck.


Here is the hard-lesson of Anytown Detroit that should really teach us ...

The Lesson of WHO Congress really works for ... and all the shabby two-bit explanations behind it -- their perpetual sell-outs.

(Here's a hint American workers:  It ain't Us, they work for ... not on most days of the Austerity week.)

The Johnson-Hatch-Vitter amendment
July 24, 2013

Senator Ron Johnson (WI) has joined with Senator Orrin Hatch of Utah and Senator David Vitter of Louisiana to make sure taxpayers across America are not put on the hook for a bailout of Detroit.
[...]

“Detroit’s debt is a national poster-child of what can result when politicians enter into an unholy alliance with powerful unions at the expense of the local economy and the people who live there.  Federal Bankruptcy Court is the proper venue for settling debts that taxpayers cannot afford,” Johnson said. “What must not happen is a federal bailout that spares Detroit from making the needed reforms that the bankruptcy process may require. Any federal bailout means other municipalities and states who have a similar history will expect a federal rescue as well.”

“Ballooning debt -- driven largely by bloated retiree pension and health benefits and mismanaged budgets -- has financially crippled cities and municipalities across the country and even forced them into bankruptcy,” said Hatch. “Whatever the financial fiasco, however, it’s the responsibility of the local governments to fix. The federal government will not step in, as this amendment makes clear, and bail them out.  We’re not going to leave taxpayers on the hook because local governments can’t manage a budget and live within their means.”

By no means should the federal government be in the business of bailing out state and local governments that are in the red,” said Vitter.
[...]


"By all means" Mr Vitter, the Congress is only there to guarantee Wall Street's survival,

-- not the survival of actual working, breathing, struggling PEOPLE from ANY Street USA.


Message received Republicans, loud and clear.


People, and especially Pensioners struggling through austerely hard-times -- You're on your Own!  (say Hello to Mad-Max!)

Congress, the Fed, and the Treasury -- Well they have "more important interests" to attend to

-- those of their Multi-Trillion Dollar favorite charity cases ...


You understand, right Americans?   8 Billion Dollar for poverty-ridden retirees,

-- NOW That's a Waste of Money!  "By no means should the federal government be involved, in THAT!" ... at least according to those "compassionate conservatives" anyways, now trying to codify the prohibition of such wasteful "charity" into Law ...



EMAIL TO A FRIEND X
Your Email has been sent.
You must add at least one tag to this diary before publishing it.

Add keywords that describe this diary. Separate multiple keywords with commas.
Tagging tips - Search For Tags - Browse For Tags

?

More Tagging tips:

A tag is a way to search for this diary. If someone is searching for "Barack Obama," is this a diary they'd be trying to find?

Use a person's full name, without any title. Senator Obama may become President Obama, and Michelle Obama might run for office.

If your diary covers an election or elected official, use election tags, which are generally the state abbreviation followed by the office. CA-01 is the first district House seat. CA-Sen covers both senate races. NY-GOV covers the New York governor's race.

Tags do not compound: that is, "education reform" is a completely different tag from "education". A tag like "reform" alone is probably not meaningful.

Consider if one or more of these tags fits your diary: Civil Rights, Community, Congress, Culture, Economy, Education, Elections, Energy, Environment, Health Care, International, Labor, Law, Media, Meta, National Security, Science, Transportation, or White House. If your diary is specific to a state, consider adding the state (California, Texas, etc). Keep in mind, though, that there are many wonderful and important diaries that don't fit in any of these tags. Don't worry if yours doesn't.

You can add a private note to this diary when hotlisting it:
Are you sure you want to remove this diary from your hotlist?
Are you sure you want to remove your recommendation? You can only recommend a diary once, so you will not be able to re-recommend it afterwards.
Rescue this diary, and add a note:
Are you sure you want to remove this diary from Rescue?
Choose where to republish this diary. The diary will be added to the queue for that group. Publish it from the queue to make it appear.

You must be a member of a group to use this feature.

Add a quick update to your diary without changing the diary itself:
Are you sure you want to remove this diary?
(The diary will be removed from the site and returned to your drafts for further editing.)
(The diary will be removed.)
Are you sure you want to save these changes to the published diary?

Comment Preferences

  •  Is that a trick question/title? (3+ / 0-)
    Recommended by:
    jamess, Youffraita, Words In Action

    99.5% of the Cretinous Congress Critters are getting their "campaign funds" from corporations and big banking and Casino Wall Street, and the chief executive has long since abdicated everything but the name to the Repukes, so most have finally figured out he's a DINO.

    Who do you think the two branches of government are going to favor?  Retirement money represents free money the stock brokers and investment bankers can squirrel away in offshore accounts.  People keep forgetting lessons others learned with Enron, et alia, when they went belly up.  They should have taken control of their own money way back then rather than leaving their money to the financial wizards who so easily manage to rob people blind.


    I'm sick of attempts to steer this nation from principles evolved in The Age of Reason to hallucinations derived from illiterate herdsmen. ~ Crashing Vor

    by NonnyO on Fri Jul 26, 2013 at 09:34:06 AM PDT

    •  It's just 'a title' (2+ / 0-)
      Recommended by:
      NonnyO, Words In Action

      trying to summarize my content,

      to get people to click.


      Usually I'm not very good with Titles?

      But its a question, we really should start asking them (congress)

      Much MORE Loudly.

      imo

      •  Sorry - I was being snarky (2+ / 0-)
        Recommended by:
        jamess, Words In Action

        I'm not good with snark.

        I weep for Detroit and Michigan residents, in truth.

        You are entirely correct.  This is a good question for our Cretinous Congress Critters.

        Actually, there are a lot of questions to ask our Cretinous Congress Critters.  Not that I'd expect a sensible response or any response at all..., but the questions should be asked.

        I'm sick of attempts to steer this nation from principles evolved in The Age of Reason to hallucinations derived from illiterate herdsmen. ~ Crashing Vor

        by NonnyO on Fri Jul 26, 2013 at 09:52:24 AM PDT

        [ Parent ]

        •  nothing to apologize for (2+ / 0-)
          Recommended by:
          NonnyO, Words In Action

          thanks for taking time to comment, NonnyO.


          (I'm just not good with titles,
          as the readers, frequently let me know ... lol)

          •  Thank you - (2+ / 0-)
            Recommended by:
            jamess, Words In Action

            Actually, there's nothing wrong with your title at all - it's good (IMHO).  It got my attention (and my brain went straight to snark, but I don't know how to convey that), and that's exactly what you need for someone to click on it.

            The rest of what you wrote is also good, so keep on writing and be proud of the good you do.

            :-)

            I'm sick of attempts to steer this nation from principles evolved in The Age of Reason to hallucinations derived from illiterate herdsmen. ~ Crashing Vor

            by NonnyO on Fri Jul 26, 2013 at 10:42:36 AM PDT

            [ Parent ]

  •  Actually, I suspect that both (1+ / 0-)
    Recommended by:
    andalusi

    bondholders and retirees are going to take a haircut.  

    The city’s current workers and retirees “are not responsible for the city’s economic state” but their retirement plans are “likely to be pilfered to pay Wall Street firms as bondholders in bankruptcy,” the AFL-CIO says.
    [...]
    I can't imagine any bankruptcy judge is going to let the municipal bondholders (who are not all "Wall Street firms") be made whole.  They are certainly going to take some kind of hit, and anyone who bought those municipal bonds as a "safe" investment is going to find out that it was no so "safe" after all.  I suspect the pensioners will get something less that what they were promised, but I can't imagine any bankruptcy judge will allow the city to simply not pay any pensions.  

    It's an unfortunate situation.  I don't see any easy way out of this for the city. It's going to be painful all the way around.  

  •  Excellent analysis Jamess (2+ / 0-)
    Recommended by:
    jamess, Words In Action

    And to top off the insanity of the Snyder administration, who planned the bankruptcy long before his EM appointment (I believe to deny the back-log of promised revenue sharing he is not giving to Detroit from the state treasury - he gave it to business buddies instead) - Snyder has approved $650 million
    to build a new hockey venue to replace Joe Lewis Arena - just what a city on the verge of bankruptcy needs - right? Yeah,
    there is email proof of his involvement in the scam to take down Detroit, unions, public education.  Count your blessings that you don't live here anymore to see the collapse of our once great state - under Repub. rule.

    Gravitation cannot be held responsible for people falling in love. - Einstein

    by moose67 on Fri Jul 26, 2013 at 09:38:15 AM PDT

  •  Ever been to Ghost Town? (2+ / 0-)
    Recommended by:
    jamess, Words In Action

    I wonder if in the next century Detroit will become a tourist destination...

    See the hundred year old buildings where nobody lives...

    Course, that assumes that the trends in infrastructure continue and the only way to  get  to Detroit will be a two lane dirt road...

    I don't blame Christians. I blame Stupid. Which sadly is a much more popular religion these days.

    by detroitmechworks on Fri Jul 26, 2013 at 09:38:59 AM PDT

  •  Yet the President embraced the bailout of (1+ / 0-)
    Recommended by:
    jamess

    Wall St. and the car companies, just not the people, communities and cities they destroyed.

    And this is the model of an economy and economic policy that this President and the Party establishment.

    It is an embrace of discredited, derelict, morally bankrupt trickle-down economics at its worst.

    How about working towards an building and running an economy as if people mattered???

    The leaders of this Party wouldn't go there if they could.

    SECURITY, because ticking time bomb mushroom cloud of terror!!
    Shop Kos Katalogue

    by Words In Action on Fri Jul 26, 2013 at 03:26:03 PM PDT

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site