Detroit, long known as one of the country's most economically dire major cities, has filed bankruptcy. TV news is full of pictures of what an outsider might think is a war zone. Buildings are abandoned. Plywood boards are hanging off the windows and doors. Detroit is presented as so crime-ridden that law abiding citizens feel compelled to drive around Detroit rather than risking driving through it.
If courts allow the bankruptcy to go through (there are state constitutional questions), it could be devastating news for Detroit's public employees and retirees. It's true that the city of Detroit has been broke for a long time. The collapse of the manufacturing base has had a dramatic impact on tax collection for the city. There's little hope that the city will pull out of its situation – at least without some serious intervention – or is that true?
The more there is to learn about Detroit's bankruptcy, the more convincing it becomes that this last-straw legal maneuver is anything but necessary. Here are eight reasons that Detroit doesn't need to and really shouldn't go bankrupt:
1. Detroit (or any Michigan city) should never have been put in this position. Detroit was one of several Michigan cities that were deemed so mismanaged that the state's Republican governor took all control out of the hands of the citizens of Detroit and gave it to a single city manager. The voters rejected the emergency manager idea and Governor Rick Snyder did it anyway. As Mother Jones writes, it was a hostile takeover.
2. Detroit's city manager, Kevyn Orr, is a bankruptcy attorney. The first bill paid during the drawdown to the bankruptcy process is $1.4 million to Orr's former law firm.
3. The emergency manager program is designed to keep cities out of bankruptcy, but emails have confirmed that Snyder may have planned bankruptcy all along.
4. Detroit's unions have been in negotiation to help pull the city out of bankruptcy. Their efforts were snubbed.
"From the beginning, we have attempted to participate in discussions and offer a restructuring plan," Dan McNamara, the president of IAFF (International Association of Firefighters) Local 344 of the Detroit Fire Fighters Association told The Detroit Free Press. "It is a shame that now we will have to be in front of a bankruptcy judge when all along we have been expecting to have meaningful meetings with emergency manager Kevyn Orr. These meetings never occurred."
Ed McNeil, a special assistant to the president of Detroit's largest union, the American Federation of State, County, and Municipal Employees Council 25, called the bankruptcy filing premature. He doubts that the city will have an easy time proving that it is eligible for bankruptcy. During negotiations, McNeil noted, "We've asked them for information, and they've never given it to us."
Source: The International.org
5. Detroit's economy may not be as dire as we are made to believe. The hotel industry is booming. In fact the Motor City's occupancy rate is about 70%, which is higher than the national average:
Detroit might be in bankruptcy, but its hotel industry is on an upward trajectory. Three casino hotels have opened in recent years. A new Starwood Aloft hotel is set to open next year in a landmark building in Grand Circus Park downtown. And developers have proposed turning a historic firehouse across from the Cobo Convention Center into a boutique hotel.
The Cobo Center itself, home to the annual North American International Auto Show, is undergoing a $290 million renovation, which tourism officials hope will attract more conferences and business travelers when completed at the end of 2014.
Other private investment in downtown and midtown Detroit by such business leaders as Quicken Loans owner Dan Gilbert is also revitalizing those areas. Gilbert has snagged more than 7 million square feet of property downtown, with plans to develop cafes and other attractions. And through a public-private partnership, a new 18,000-seat arena for the Detroit Red Wings has gotten the green light in midtown, with an accompanying entertainment district.
Source: USA Today
rest http://thebigslice.org/eight-reasons-detroits-bankruptcy-is-a-scam/
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