So now it is all but official: Detroit will be getting a financial manager, likely sooner rather than later. Yesterday, as everyone expected, the state’s review team announced that the city was in a financial emergency. Appointing a manager is the only logical next step.
It’s long been clear this day was inevitable. Indeed, it was probably a foregone conclusion when the city agreed to an unwieldy consent agreement with the state nearly a year ago.
The problems were too big and the huge financial liabilities too vast to ever be solved by any elected political leaders. It is true that those now running Detroit were mostly either ineffectual (the mayor) or pigheaded and irrational (the city council). But when you look at the scope of the problems, it is unlikely that a team of the greatest politicians in our history could have solved this mess.
Today, state officials, including the review team, are blaming Detroit’s unwieldy city charter, which they said, “make it extremely difficult to restructure the city’s operations in any meaningful and timely manner.” Well, that’s true enough. But it isn’t clear that anything would have worked, other than to have the 82nd airborne division take over public safety, and parachute in with twenty billion dollars in cash.
The city is broke. It has a current budget deficit approaching a third of a billion dollars, and long-term, mostly unfunded liabilities of $14 billion. If Silicon Valley was a city in that shape, it might be able to come up with that money. Detroit can’t possibly do so.
There are fewer than 700,000 people left. A slight majority of the adults are not even in the labor force. Education levels are low; poverty and illiteracy rates are astronomical. The city is mortgaged to the hilt. Grossly inadequate public services and too-few police on the street mean the ability to attract a meaningful influx of new taxpaying residents is not there, at least for now.
In a bizarre way, the irrational behavior of city council did the city a favor, by underscoring the fact the city can‘t help itself. So now, the state will try to do it. There are those who greatly fear the idea of an emergency manager, and those who are ecstatic at the idea, and both camps are probably somewhat wrong.
Those opposed should realize that now, at least, someone will start the painful process of clearing the ruins so the city can rebuild. But those who welcome the manager should realize that, for the foreseeable future at any rate, this will mean a lot more pain.
The manager isn’t coming with a Marshall plan. She or he is coming with the goal of balancing the budget and eliminating debt, and that means pay cuts, cuts in benefits, liquidation of assets. And it may well mean bankruptcy and starting from scratch, with basically nothing.
We all share in the blame for the tragedy and agony of Detroit—those who abandoned the city; those, like Kwame Kilpatrick, who cruelly exploited its citizens. Now, at least there will be a chance to start over.
Everyone in Michigan has a stake in Detroit’s eventual success. We owe it to ourselves to do what we can, in coming years, to help.
Jack Lessenberry is Michigan Radio’s political analyst. Views expressed in the essays by Lessenberry are his own and do not necessarily reflect those of Michigan Radio, its management or the station licensee, The University of Michigan.