Detroit may be on track for a smooth exit from bankruptcy court, concluding the term of state-appointed emergency manager Kevyn Orr and restoring local control to the city's elected leaders.
Some people don't believe Motor City politicians are up to the job, however, after Detroit filed for bankruptcy last July citing $18 billion in long-term obligations. One prominent businessman has come under fire for saying Detroit's elected officials shouldn't be allowed to lead the city again.
Keith Crain is the chairman of the board of Crain Communications, the Detroit-based trade publications company home to Advertising Age, Automotive News and numerous trade and city-based publications. On Sunday, Crain's Detroit News published an editorial by Crain with a headline -- since changed -- calling for a "permanent overseer" to run Detroit.
"It simply makes very good sense for everyone — except those being supervised," Crain wrote.
The online backlash was immediate. "It ignited criticism on blogs and social media that Crain was grossly insensitive for using a word -- overseer -- closely linked to slavery while commenting on a city that is more than 83-percent African American," the Deadline Detroit blog commented. The blog also sent out a Tweet referring to the magazine publisher as "Massa Keith Crain."
Meanwhile, the liberal Michigan-based Eclectablog declared that Crain owes the city of Detroit an apology for the column's "slave plantation" imagery and notion that Detroiters are unable to run their own city.
Under Michigan's emergency manager law, Gov. Rick Snyder (R) is empowered to appoint an emergency manager to cities, towns or school districts weathering a fiscal emergency. Emergency managers are granted powers well beyond those of mayors: they can fire elected officials, renegotiate contracts and sell off property without a vote. In 2013, 50 percent of Michigan's African-American population lived in a city where an emergency manager had assumed control.
"It’s an unbelievably tone-deaf piece that also continues to perpetuate the myth that Detroit’s current financial crisis is entirely the fault of incompetent city leaders who mismanaged the city’s finances," Eclectablog author Chris Savage wrote. "Anyone who knows even a small amount of the history of Detroit from the 1950s through yesterday knows that this is unfair, untrue, and entirely racist."
No one single factor can explain why Detroit went bankrupt. Widespread sprawl in the surrounding area contributed to its plummeting tax base. Almost 4.3 million people call the Detroit metropolitan area home; only 700,000 of them actually live within the city limits. Decades ago, Detroit's population exploded as people came to work in the city's numerous and well-paid automotive factories. Most of those jobs have since left the city. There are now twice as many retired city workers in Detroit as there are current employees paying into its two pension funds, contributing to the city's underfunded obligations. A report released this year by the Demos think tank blamed Wall Street bankers for engineering a series of highly complex swaps deals in 2005 and 2006 that cost Detroit over a billion dollars.
Firefighters protest outside the Theodore Levin United States Courthouse, in Detroit, Wednesday, July 24, 2013.(AP Photo/Paul Sancya)
Corruption and mismanagement have also played their part in engineering the city's decline. Spending for today without considering how the city would pay for it tomorrow pushed Detroit over the line into bankruptcy, according to a Detroit Free Press report highlighting the city's disastrous borrowing practices in the 2000s. Former mayor Kwame Kilpatrick, who was sentenced to 28 years in prison for corrupt practices while in office, delivered another black eye to the city in crisis.
Stories of incompetency are all too easy to find, like a $1 million check that sat in a desk drawer at City Hall for an entire month before someone noticed it. With no money to spare, city services are also stretched thin. Police officers may not show up for hours after a crime is reported, and ambulances and fire trucks are often broken down and out of service. Half of the city is dark at night, due to a broken and antiquated streetlight system that has been too expensive for Detroit to fix.
An editorial published Monday in the Detroit News called for dissolving or dismantling Detroit government's entirely, either by decentralizing the city into smaller local governments or merging Detroit with Wayne County, where the city is located.
"Sure, there have been laudable reforms to come out of the bankruptcy process, but in reality this is nothing more than rearranging the deck chairs on the sinking Titanic," wrote author Dennis Lennox, a Republican strategist.
When New York City was on the verge of bankruptcy in 1975, the state of New York appointed a board to oversee the city's future financial decisions and recovery. Despite originally vowing not to bail out New York City, President Gerald Ford approved $2.3 billion in federal loans to aid its recovery. The White House has said that a similar bailout of Detroit wasn't politically viable, although it has fast-tracked federal grant money awarded to the city.
(AP Photo/Paul Sancya)
Local protesters of the emergency manager and bankruptcy in Detroit have come up with their own blueprint to fix the city, dubbed the "People's Plan." It calls for solutions like fining landlords for their blighted properties and making urban farming legal throughout the city, while demanding banks and other "Wall Street" creditors should not be repaid.
Last year, Rev. Wendell Anthony, president of the Detroit chapter of the NAACP, urged the state of Michigan not to appoint an emergency manager, which he also called an "overseer," to guide the city, instead asking Gov. Snyder to work hand-in-hand with leaders elected by Detroiters.
“Has Michigan become the new Mississippi of our day?” Anthony asked.