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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsThree Questions About the Motor City by David Sirota
http://www.commondreams.org/view/2013/12/14-1Michigan Central Station in Detroit has become of the city's supposed disrepair. (Photo: Timmy Caldwell/ cc via Flickr)
***SNIP
1. Why are Detroit officials simultaneously moving to cut municipal workers' pensions while spending hundreds of millions of dollars on a new professional hockey stadium?
Gov. Rick Snyder, R-Mich., and his appointed emergency manager Kevyn Orr are pleading poverty to justify cuts to the average Detroit municipal worker's $19,000-a-year pension. Yet, they are also saying they have plenty of money available to continue a planned $285 million taxpayer subsidy for the construction of a new hockey stadium for the Red Wings. Economic data over the years suggest that that paying pension benefits is often a far more powerful tool for economic stimulus than financing stadium subsidies. That's because pensions reliably pump resources into a local economy while stadium subsidies often end up a net loss for taxpayers. So why is Detroit prioritizing stadiums over pensions?
2. Why are municipal employees being blamed for Detroit's woes when data prove they had little to do with the city's fiscal problems?
In an extensive report for the think tank Demos, former Goldman Sachs investment banker Wallace Turbeville shows that Detroit officials' current "focus on cutting retiree benefits and reducing the city's long-term liabilities to address the crisis (is) inappropriate and, in important ways, not rooted in fact." That's because, as Turbeville documents, "Detroit's bankruptcy was primarily caused by a severe decline in revenue and exacerbated by complicated Wall Street deals that put its ability to pay its expenses at greater risk." Yet, despite these facts, Detroit's municipal employees are primarily being blamed by politicians and pundits for causing the crisis.
Why?
3. If Michigan is so strapped for cash, why is Gov. Snyder almost doubling the salaries of his top officials?
The Detroit Free Press reports that while exploring pension cuts, Snyder's administration "quietly increased the salaries of its top investment officials in the Treasury Department by more than 80 percent." As just two examples, Snyder's move means that a pair of his top aides will now be paid an annual salary of $333,000 and $233,000, respectively. If as Snyder's administration claims, "there's not enough money" for pensioners, how is there enough money to pay Snyder's political appointees those kind of salaries?
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Three Questions About the Motor City by David Sirota (Original Post)
xchrom
Dec 2013
OP
Demeter
(85,373 posts)1. Because Snyder is a Crook. A Venture Capitalist Crook
He's just kept a lower profile than Scott Walker, over in Wisconsin.
El_Johns
(1,805 posts)3. K&R. Planned, coordinated theft.
Octafish
(55,745 posts)4. Can't wait to bid on the Van Gogh.
Orr says DIA masterpieces worth less than thought
Banksters win. People lose. We're getting used to it.
Banksters win. People lose. We're getting used to it.
xchrom
(108,903 posts)5. Federal Judge Describes, Then Supports Plot to Rob Detroit Pensioners
http://www.alternet.org/economy/federal-judge-rhodes-commandeers-detroits-bankruptcy-giving-away-assets-highest-bidder
On December 3, United States Bankruptcy Judge Stephen A. Rhodesto the surprise of no oneformally ruled that Detroit is eligible for bankruptcy. In other words, creditors will now wrangle over Detroits government assets with Rhodes as the referee.
It is important to understand that at no point has Detroit declared or requested bankruptcy. Indeed Detroiters and others in Michigan have resisted as best they could, only to be overpowered at every turn. As Judge Rhodes explains below, bankruptcy has been orchestrated from Lansing (the state capitol) with a lot of help from Wall Street banks and other financial players.
Taking power away from Detroiters began decades ago. As the city's African American population grew, so did the forces trying to deprive it of democracy and assets. A tangled web of bipartisan power grabs steadily shifted revenue and decision making to the suburbs, state government and predatory lenders. Far from helping the cityalthough onlookers wouldn't know it based on loud, public proclamations to the contrarythe end result crippled Detroit and ushered in its fall.
Starting in 1999 Lansing's state government decided it was in their bailiwick to manage the Detroit Public Schools, a task historically overseen by elected officials. The result? School performance worsened, which resulted in the departure of more residents. Combined, these two factors only sped up the areas decline.
On December 3, United States Bankruptcy Judge Stephen A. Rhodesto the surprise of no oneformally ruled that Detroit is eligible for bankruptcy. In other words, creditors will now wrangle over Detroits government assets with Rhodes as the referee.
It is important to understand that at no point has Detroit declared or requested bankruptcy. Indeed Detroiters and others in Michigan have resisted as best they could, only to be overpowered at every turn. As Judge Rhodes explains below, bankruptcy has been orchestrated from Lansing (the state capitol) with a lot of help from Wall Street banks and other financial players.
Taking power away from Detroiters began decades ago. As the city's African American population grew, so did the forces trying to deprive it of democracy and assets. A tangled web of bipartisan power grabs steadily shifted revenue and decision making to the suburbs, state government and predatory lenders. Far from helping the cityalthough onlookers wouldn't know it based on loud, public proclamations to the contrarythe end result crippled Detroit and ushered in its fall.
Starting in 1999 Lansing's state government decided it was in their bailiwick to manage the Detroit Public Schools, a task historically overseen by elected officials. The result? School performance worsened, which resulted in the departure of more residents. Combined, these two factors only sped up the areas decline.