Detroit City Council President Charles Pugh and five other council members on Tuesday heard from residents who urged them to pursue legal action against the emergency manager law. (John T. Greilick / the Detroit News)
As Detroit City Council mulls the role it hopes to play when the emergency financial manager arrives Monday at City Hall, I keep thinking about General Motors Corp., circa 2008.
You remember then: Chairman Rick Wagoner, joined by his cross-town peers and the president of the United Auto Workers, begged Congress for bailouts to avert insolvency already too far along to prevent the logical conclusion called bankruptcy. Infected with the inertia, entitlement and arrogance long manufactured in Detroit, they moved way too late to address systemic problems years in the making.
Afflicted by the same symptoms, a glaring lack of credibility and a selective sense of outrage, council members and their supporters who oppose Gov. Rick Snyder's allegedly heavy-handed appointment of Kevyn Orr to be the Detroit's emergency financial manager are moving way too late, too.
They don't really have solutions, as they've so ably demonstrated, except to know they don't like the one offered by the governor under a law that has been on the books in several forms since 1990. They oppose efforts by an outsider to fix basic services and to restructure the city's finances yet support elected incumbents who have done neither — and shown no inclination or ability to do so.
No, they're way past late. The financial crisis bearing down on Detroit has been hiding in plain sight for years. Evidence can be found in the city's own audits; its slumping bond ratings; its mounting (unfunded) obligations for retiree health care; its bad habit of covering cash shortfalls with new debt it cannot afford, producing fat fees for Wall Street bankers in the process.
A reckoning? Absolutely. Detroit's culture of denial, dysfunction and entitlement, as obvious in the city's slide as it was in the auto bankruptcies, is a primary reason change here eventually is imposed from the outside. Given time, insiders prove they cannot, or will not, get the job done.
Because an imminent collapse of GM promised to shake a battered American economy, President Barack Obama and his Republican predecessor financed a controversial rescue that required a tough restructuring. An uncontrolled fall by the city of Detroit into financial chaos poses a threat to the state, its economic revival and image that cannot — should not — be ignored by any responsible governor.
"For Michigan to be a great state, Detroit has to be on a path to being a great city," Snyder said in an interview this week. Political rhetoric from the Relentlessly Positive One? Partly. But it also happens to be more true than the We-Hate-Detroit cynics may be willing to acknowledge.
The city is a financial basket case of towering debt, chronic cash shortfalls and hapless budgeting. City services are broken and poorly managed. Morale in public safety departments, whose work is critical to reassuring residents and attracting new ones, is poor. And doing the same thing and expecting different results all but guarantees failure.
Structural deficits, unsustainable debt and dysfunctional city government impede economic development and business investment in Detroit. Installing a quantifiable process that sets priorities and methodically executes a restructuring plan should benefit longsuffering residents far more than a status quo that resists change, demands more money and makes problems worse.
There are all sorts of ways to criticize Snyder's emergency manager: It's an anti-democratic usurpation of voting rights; it hasn't worked in other communities or school systems, including Detroit Public Schools; the concept of its empowering law, but not the newly enacted Public Act 436 itself, was repudiated by voters last November.
None of which offers a solution, only variations on the same tired lament. One of the many lessons of the GM slide into bankruptcy, its exit and the way back up is that revival required outsiders with fresh ideas, scant institutional memory and minimal political entanglements within the company to succeed.
The same rule applies in Detroit. Sitting officials, perhaps even including Mayor Dave Bing, may be allowed by Orr to continue drawing paychecks (for a time, at least). But the likelihood that they will drive decision-making will diminish as more decisions are made and campaigning for the November election to replace them shifts into high gear.
Restructurings have a justice all their own. Over time, those associated with the failures that precipitated the crisis are sidelined, new leadership steps in and a different institution begins to emerge.
Yes, the city of Detroit is not a profit-seeking company like GM that produces and sells products to the public to generate revenue. But it collects taxes to fund services to the public and to taxpayers, and to manage its operations well enough to fulfill that obligation.
For too long, it's done neither well, if at all, and that will change because it has to change.
(313) 222-2106
Daniel Howes’ column runs Tuesdays, Thursdays and Fridays.
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