Commentary: Decision time for Detroit

Nov 14, 2012

The election may have settled some things, but it has left the state of Michigan with an overwhelming problem that we have to solve soon, or suffer devastating consequences. Consequences that will affect us all, whether we live in Monroe or Marquette.

And that problem is the City of Detroit. Once again, the troubled and impoverished city is fast running out of cash.

The jury-rigged consent agreement designed to avoid an emergency manager isn’t working. To say that Mayor Dave Bing and the city council aren’t working well together would be an understatement. But at this point, it seems unlikely that Franklin D. Roosevelt and the three wise men could save the city.

Years of bad decisions by elected officials, coupled with the selfishness of those who took from the city and gave little in return, have left Detroit in a dreadful mess. The outlines are well known. The city has too few police officers to protect the residents.

Fewer than 700,000 people live in a space that once held close to 2-million. More than half the adults aren’t in the workforce. Nearly half may be functionally illiterate.

The city is struggling to balance its current budget, and has $12-billion in unfunded pension and other liabilities it is never going to be able to pay.  The city is, as it was last April, within weeks of running out of cash to pay its bills.

And in a sense, the voters made things more complicated by repealing the tough Emergency Manager law the legislature enacted last year. The vote to reject it was far closer than the vote rejecting the five proposed constitutional amendments.

But reject it we did, and that has worsened the crisis. The governor is operating under the assumption that the law’s repeal means the old Emergency Financial Manager law is back in place.

However, that is being challenged by some who now that no emergency manager law exists at all. Even if the old law is still valid, it doesn’t provide the ability to modify union contracts. The crisis is likely to soon come to a head. If the city does topple over into uncushioned bankruptcy, with payless paydays for employees and possible suspension of public services, the consequences will be frightening. And even those of us who live hundreds of miles away will pay for it in terms of credit rating and potential business lost.

Those looking to make new investments aren’t likely to come to a state whose major city is a symbol of collapse, corruption and ruin.

The best solution may be for the legislature to craft a new emergency manager law designed to give the city a way to reinvent itself and get through this crisis, by whatever means necessary. The law must be somewhat different from the one voters rejected. But the bottom line is the overwhelming need to prevent Detroit from collapsing into some form of anarchy that will hurt us all. 

This won’t be easy and it won’t be pretty, and we are all going to have to suffer some pain. But it is brutally necessary. Those in power were elected to make tough decisions when needed, and they are needed now. Lansing has no choice but to lead.

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.