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Thursday, September 29, 2016

Governor Rick Snyder (R-MI) was so desperate to make Detroit the largest American city to declare bankruptcy that his lawyers apparently used deception to make sure their filing was in before a judge could block it.

Ronald King, an attorney for Detroit’s General Retirement System and the Detroit Police and Fire Retirement System, said that he agreed to delay a hearing on an injunction that would have prevented the city from filing for bankruptcy for five minutes at the request of Snyder’s lawyers. In that five minutes, attorneys filed papers to put Detroit under bankruptcy protection, placing all legal action against the city in a temporary stay.

“It was my intention to grant your request,” Ingham County Judge Rosemarie Aquilina told the pensioners’ attorneys.

“There’s no denying this was a race to the courthouse this afternoon and yet another example of usurping the will of the people,” King said.

Pensions are protected under Michigan’s constitution, but this protection has not been tested in federal court. The city has about $18 billion in debt.

The Michigan Republican Party’s eager embrace of emergency manager powers has left about half of the state’s African-Americans without elected local representatives.

When voters repealed the emergency manager law in 2012 by 53 to 47 percent, the state’s Republican-dominated legislature quickly restored it, including a provision that made it impossible for votes to repeal the law again.

Part of the argument for these laws, which allow state officials to replace all elected city officials in municipalities deemed to be in “emergency” with an unelected bureaucrat, was that this process would prevent bankruptcy, which would be too disruptive.

When Snyder selected bankruptcy expert Kevin Orr to be Detroit’s emergency manager, however, it became clear what path the governor, who faces re-election in 2014, had in mind for the Motor City. Orr  — who has already hinted at his intention to cut pensions — will manage the bankruptcy, carrying out the governor’s wishes.

Unions who have seen Snyder and a lame-duck legislature rush in a law designed to weaken unions along with tax increases on pensioners are not hopeful about  the bankruptcy process.

“Every step of the way, the citizens of Detroit were told that they had to give up their right to democratic representation in order to avoid bankruptcy,” Metro Detroit AFL-CIO president Chris Michalakis and Michigan State AFL-CIO president Karla Swift said in a joint statement. “Now that this filing has come anyway, it is clear that either state control has failed or that Governor Snyder and his emergency manager appointee were not honest about their intentions in the first place.”

As the city’s debts are discharged, the question is who will be asked to pay: workers — who were promised a retirement and have already offered concessions — or investors — who knew they were taking a risk?

UPDATE: Judge Rosemarie Aquilina has ruled the Detroit bankruptcy filing violates Michigan’s state Constitution and must be withdrawn, noting that the there had been a “rush” to bankruptcy.

Photo: Jason Paris via Flickr.com

(H/T: @DearDavidWA.)

 

  • sigrid28

    It’s amazing how much damage Snyder has done in three years in a state like Michigan. His city managers program for failing local governments alone should spell the end for him in electoral politics.If he and his comrades are not driven out of office next year, Michigan deserves the hell he has visited upon it.

    • JO

      The Tea Party is no more than the Posse Comitatus in suits. Their main objective is to eliminate government.

      • sigrid28

        It’s a chilling thought. Now my son has to come and calm down again.

      • Bill

        What the GOP wants is total control, they only talk about smaller Government because they are not in control.

  • Allan Richardson

    Over the years, the wealthy have moved their residences and their businesses out of the city limits of most large cities, including Detroit, leaving behind virtually no real estate tax base, very little business to collect sales taxes, and an impoverished population which leads to higher demand on city services such as police, fire, and relief for the poor who are left behind. Now the Republicans in Michigan are depriving the poor in the city even of DEMOCRATIC GOVERNMENT with “emergency managers” who steal what is LEFT of the city treasury for their buddies. Someone needs to go to jail for this massive theft.

    The same thing is starting to happen here. The Republicans in Georgia have found a NEW reason to gerrymander: Fulton County includes Atlanta and a lot of suburban area. They have carved out small corners of Fulton County and added them to state legislative districts whose voter base is mostly in the suburbs. This has allowed them to stack the “Fulton” legislative delegation with a majority of non-Fulton Republicans, so that the ACTUAL Fulton delegation, mostly Democratic like the majority of Fulton residents, can be outvoted. And they are going after the city of Atlanta also, telling it that they cannot make NECESSARY hikes in city tax rates.

    Only the REALLY big cities such as New York are escaping this fate, because they have SO MUCH of a tax base from Wall Street firms that NEED to be inside the city and so cannot flee to the suburbs. How much longer they will survive is anybody’s guess, since more and more of the banking, investment, and legal business CAN be done online.

    • sigrid28

      In exactly the way the FBI and CIA groom agents, some right out of high school, the Democratic party run by intelligent people (not the local branches that have membership only by invitation and are sometimes as xenophobic as low-information Republicans) needs to find a team for each state and train them to suss out the MAPS covering every office in the state (even dog catcher). Each team needs a take-no-prisoners long-time state Democrat running it, so they can help another team locate candidates and undermine the dirty tricks that go along with stealing districts from the people who live in them. Gerrymandered districting has to be won on a local basis until state legislatures or city councils or county governments can be fair again, so the votes of every citizen count. Unless Democrats want to get really smart Republicans may succeed in winning elections and destroying government one small unit at a time.

  • ayungclas

    So Snyder’s dictatorship of the proletariat continues to expand. I hope his buddies are making a lot of money off of this.

  • Gerald Larey

    California was going bankrupt…got rid of the idiot GOP ‘governator’…now doing ok. Maybe time for midwest to meet west and finally LEARN something? ‘_’

    • sigrid28

      Amen. Let it be Sunday every morning in California, then Wisconsin and Michigan.

    • Allan Richardson

      And I hope Florida gets rid of its “goniffator” who won his campaign money by running a hospital chain specializing in Medicare fraud next year!

    • montanabill

      Doing ok by using ‘projections’? Get back to me at the end of Mr. Brown’s term so we can see how it really turned out.

      • Gerald Larey

        Like 6-7 years from now? He WILL be re-elected. I’ll be SURE and have my staff get back to ya’s…top priority ‘_’

        • montanabill

          I didn’t say he wouldn’t get re-elected. Dems seem to be oblivious about what causes economic and societal destruction, and Dems will be all that is left in 6-7 years. What we will be looking for is the validation of Mr. Brown’s agenda. But I rather expect the usual ration of excuses. Somewhere, Rick Perry is smiling.

          • Gerald Larey

            If Rick Perry were smiling, he wouldn’t be cutting cheesey radio commercials BEGGING businesses to come to his woeful state. From what I hear from BOTH sides, TEXAS will be smiling when that jackass is GONE! Please find a better example, Mr Montana.

  • Catskinner

    This is ridiculous. It took fifty years for Detroit to go bankrupt.

    • Allan Richardson

      And it happened because of conservative policies implemented by private corporations (in the case of Detroit, the auto industry), then since 1980 by the Reagan/Bush/Bush administrations (with misguided voters pressuring Clinton to do the some of the same, against their own interest), and most recently by state governments such as Snyder’s to give the coup de grace. The forces that made Detroit go bankrupt were mostly out of the control of the city government, but were DEFINITELY under the control of certain other people who KNEW what they were doing and WANTED that result.

      The “lords” of Wall Street and K Street are tired of being FIGURATIVELY called “lords,” they are working on a NEW FEUDALISM so that the rest of us will REALLY have to call them “Your Lordship,” or at least kiss their rings a la Godfather if we want a favor.

      • Catskinner

        Isn’t the last mayor in jail now? Do the pensioners who built up those huge retirement benefits still live in Detroit, or did they take the money and run, leaving the few folks that got left behind to pay all the bills?

  • RobertCHastings

    Good for Judge Rosemarie Aquilina. She clearly demonstrates two very important issues – that the governor is little more than a crook, and that Michigan is another state that has fallen under the dark umbrella of Republican malfeasance. By bringing to light the highly illegal actions of the governor and his supporters, Judge Aquilina has hopefully raised the awareness of Michigan voters to the point where they will reject totally the Republicans next year.

    • Allan Richardson

      Exactly. It is time for the voters to realize that the Elephant has no clothes. When a Democratic politician is incompetent, it is a personal failing. When a Republican pushes seemingly incompetent policies, it is part of the program. Their goal is power for themselves, NOT the good of the country.

      Politics is like driving a car: select D to go forward, R to go backward.

      • RobertCHastings

        I really like that driving a car thing. What you say is dead on the money.

  • montanabill

    Detroit was ‘rushed’ into bankruptcy over 50 years. Nothing now but the squeals of politicians who simply can’t find more of ‘someone else’s money’ to extend the ‘rush’.

  • KenG

    How come nobody understands our elected by the people government is in dire need of money for wars and funding other country’s militaries and promoting democracy in other countries by funding those who are taking existing governing bodies down? Gees, money isn’t putting the taxpayers deeper in debt for the good of us and that shouldn’t be that hard to figure out so this is just the way life is in the United States! Live with it!

  • bexcee

    This article intellectually dishonest. Typical.