Detroit Journalism Cooperative


This next story is a call to anybody with $170 million to spare.

And a major fondness for art.

By now, you’ve heard about the group of philanthropists who’ve raised $330 million to strike a “grand bargain” with Detroit’s creditors.

Their goal is to raise half a billion dollars to save city-owned art at the Detroit Institute of Arts from being sold off in the city’s bankruptcy.

But that grand bargain may still require a small miracle.

Fair or not, bankruptcy pitting art against pensioners

Detroit emergency manager Kevyn Orr moved to “freeze” pension benefits for some city retirees — then suspended that action as the city and pension fund representatives talk in mediation.

Orr quietly issued that order late last month. It affects members of Detroit’s General Retirement System—not police officers or firefighters, who have their own, separate pension fund.

Detroit mayor-elect Mike Duggan will have broad powers to run the city’s day-to-day business.

Duggan and emergency manager Kevyn Orr have reached a power-sharing agreement that gives Duggan control over most city functions.

While Duggan will have substantial operational powers, he’s also promised not to “interfere” with any of Orr’s financial control.

Detroit bankruptcy judge Steven Rhodes.
John Meiu / Detroit Legal News Publishing LLC

The judge in Detroit’s bankruptcy case says creditors can appeal his recent eligibility ruling directly to a higher federal court.

Judge Steven Rhodes ruled earlier this month that Detroit is eligible to proceed with its historic bankruptcy case.

He also ruled that city pensions can be cut in federal bankruptcy court — despite a public pension guarantee in Michigan’s state constitution.

City unions, pension funds and retiree groups immediately said they intended to appeal both decisions.

Two Obama administration officials were in Detroit this week to highlight White House efforts to help Detroit.

Labor Secretary Thomas Perez and Education Secretary Arne Duncan visited Macomb Community College.

That school is one of eight Michigan community colleges sharing a $25 million grant to “create and expand innovative partnerships between community colleges and businesses” to train more workers for in-demand jobs.

Detroit Mayor Dave Bing says he’s pleased with how his administration has “moved the needle forward on Detroit’s future.”

Bing talked about his accomplishments and challenges as mayor in a farewell speech to the Detroit Economic Club Wednesday.

The Detroit Institute of Arts

What’s going to happen with the Detroit Institute of Arts?


That’s the question on the minds of many Michiganders after the city of Detroit was deemed eligible for Chapter 9 bankruptcy on Tuesday.

Daniel Howes, a business columnist with The Detroit News, talks with us about all things DIA – a recent appraisal of the institute’s collection, emergency manager Kevyn Orr’s interest in the museum, and a possible rescue plan cooked up by a federal judge.

Listen to full interview above. 

Rene Passet / Flickr

There was another plot turn in the long story of Detroit's struggles yesterday.

A federal bankruptcy judge looked at all the evidence and declared, yep, the city of Detroit is indeed insolvent.

It's new, for sure, but for many who have lived and worked in Detroit, it's just more of the same.

Derrick May is one the founding fathers of techno music. Detroit was the birthplace of the genre, and May has achieved a lot of success traveling around the world playing shows. (Listen to his breakout hit here.)

When I was growing up in the 1960s, there was a popular genre of fiction: Novels about the world when and after the presumably inevitable nuclear war happened.

One that I remember was set in rural Florida, one of the few places that avoided total destruction. The survivors set up what amounted to a working subsistence and barter economy. 

But for some, the psychological adjustment was impossible. The town banker sat among piles of paper money that he had always revered as sacred, and which suddenly had no value whatsoever. Unable to adjust, he kills himself.

Things are not nearly that bad in Detroit. But yesterday, there were clear signals that sacred cows really are going to be sacrificed. Public pensions were thought to be sacrosanct, protected by the state constitution. Well, they aren’t, according to Federal Bankruptcy Judge Steven Rhodes. Federal law trumps state law. 

Michigan Radio has been selected to receive a cooperative grant from the John S. and James L. Knight Foundation as part of the Detroit Journalism Cooperative for coverage of the city of Detroit as it moves through bankruptcy. The grant is intended to support news in the public interest and improve the quality and quantity of news coverage about Detroit. Data-driven journalism will explain the city’s financial issues and engage citizens in looking at solutions. Michigan Radio’s reporting will focus on the city’s bankruptcy and its impact on community life and the city’s future.

 A new report says declining revenues and bad Wall Street deals—not out-of-control spending or generous pension benefits--contributed the most to Detroit’s bankruptcy.

The report from the left-leaning think tank Demos also accuses Emergency Manager Kevyn Orr of attacking the problem in “inappropriate” ways that are “not rooted in fact.”

Detroit Skyline
Dave Linabury / Flickr

With the bankruptcy trial in full swing, we thought we'd share the following facts with you about the Detroit bankruptcy case.


  • State declares Detroit is in a “financial emergency” on March 1, 2013

  • Kevyn Orr appointed as Detroit’s emergency manager on March 14, 2013

  • City files for Chapter 9 bankruptcy on July 18, 2013

Detroit is in the news a lot these days, and will continue to be, for obvious reasons, as the city goes through the agony of the bankruptcy process while simultaneously conducting an election. An election, that is, for a new mayor and City Council who will be essentially figureheads until Emergency Manager Kevyn Orr leaves, something that will probably happen a little over a year from now.

But while the media is concentrating on the bankruptcy itself, I sense that we aren’t asking the really important questions. For me, the most important of all is simply this: What happens after bankruptcy is over?

There are streets in Detroit that bear an uncanny resemblance to Germany at the end of World War II. The shells of red brick buildings stand, most of them burned out, roofless, some with homeless and destitute people squatting in the ruins.

Looking at a street like that the other day, I was struck by the thought that throughout the last year of the Second World War, as vast armies raged across Europe, there were teams of planners in Washington and elsewhere working on how to govern the conquered nations after the war; How to lead them on an eventual path to a return to normalcy and democratic self-government.

Steven Depolo / Creative Commons

It’s a question many in local governments across the state have been asking themselves lately.

There are a couple ways Detroit’s bankruptcy could have a bad influence on other local governments.

The simple way: not so good national media attention

The simplest way is all that bad press the nation’s biggest municipal bankruptcy will bring. But Detroit’s finances have been screwed up for decades. That’s not news. Economists that track indicators in West Michigan say it won’t help, but they do not expect this to be a big factor.

The more important way Detroit’s bankruptcy could affect small governments is much more complicated.

The complicated way: “unprecedented” threats to municipal bonds

First, you’ve got to understand these bonds are really important to local governments.