The city of Detroit is under the threat of being overtaken by a State-appointed Emergency Financial Manager. This action supported by the Governor Rick Snyder and State Treasurer Andy Dillon, is meeting some opposition from the local officials. There are many sides to this issue and it behests the question: Should we let Detroit go Bankrupt? What would truly solve the city of Detroit's financial woes. With the prospect of an EFM, the concern is what necessary services would the EFM cut. Would there be a slashing of benefits? Would there be a decrease in services? Would the city become more dangerous?
There are a number of speculators, but no one knows exactly what will happen. Cutting government spending, which sometimes shows as government waste in a budget reconciliation, does not sound bad when it stated as such. A point of mention for many Detroiters and maybe one worth considering if the taxation in the city. The City's taxes are among the highest in the region, however the services provided are among the least efficient. Majority of the city's spending is allotted for Police and Fire, but with closing stations, decreased manpower and limited action, it is hard to believe. A public policy course in any university would teach that local governments and municipalities are to carry balanced budgets, however in recent years, deficits have become commonplace and the idea of surplus become enthralled with government waste and corruption.
Detroit has experienced the closing of the corruption case involving Kwame Kilpatrick and the opened opportunity to resolve the city's financial woes with newly appointed Emergency Financial Manager Kevyn Orr. Kevyn Orr is a bankruptcy lawyer who also helped Chrysler muscle through its bankruptcy. A distinguished Orr announced his desired course of action to reach a consensual agreement and avoid Chapter 9 Bankruptcy. He also stated as a sign of his accreditation that if needed, he is unashamed to lead Detroit in Chapter 9 Bankruptcy. A lot of the opposition initially faced to the election of an EFM has subsided on the municipal level. Detroit City Council has decided to end its charge to file suit against the state. The new EFM will be awarded an annual salary of $275,000 and expects to have the city back on track in 18 months. Though hopeful, it is challenging to say what will happen, in truth, no one really knows.
With the appointment of a gubernatorial non-political official, we can only hope that seeds of corruption do not flourish as they have for decades in Detroit politics. We hope that the people of Detroit will come together for the betterment of themselves. In all our hope, we must have confidence, that not only will we survive, but that our own actions toward a brighter future will not be ignored. Once a people are united, they signify strength.
For more information, please see links below.
Does Pontiac EFM prove such management works?
Community outpours oppposition to emergency manager in Detroit
Fellow Rev. David Bullock told an emotional crowd during a press conference that an emergency manager’s track record is really non-existent.
“We will not allow the governor to destroy democracy and experiment on the people of Michigan with a public policy approach that has no successful track record,” he said.
The state review board issued a report saying the city faces a cash shortfall of more than $100 million by June 30, and that long-term liabilities, including unfunded pension liabilities, exceeded $14 billion. Detroit has been borrowing to continue operations and would have fallen about nearly $1 billion short last year if it hadn't issued new debt.
For the City Financial Report and Information