Problem is, Obama's stash is mutating into something strange...
Posted on 11/15/2013 9:46:47 AM PST by SeekAndFind
Back in July, the city of Detroit filed for the largest municipal bankruptcy in United States’ history, with the city owing more than $18 billion in debt and liabilities following decades of purely blue leadership. The city’s appointed financial managers have already gotten to work on digging the city out of the massive hole into which it dug itself over the years, but not without the requisite challenges and lawsuits from unions and pension funds irate about the major losses that are going to be foisted upon everyone involved — and all of the work the city has done so far to save itself could be undone if a federal judge decides that Detroit is actually ineligible for Chapter 9 bankruptcy after all. Via the AP:
After a nine-day trial, Judge Steven Rhodes must decide whether Detroit really qualifies for the court’s help to fix its awful long-term finances — including $18 billion debt. Although they haven’t offered specifics, officials predict a “free-fall crisis” if the city is found ineligible and warn that the improved services, such as those streetlights, could suffer. …
“If the bankruptcy is disallowed, frankly, expect all hell to break loose,” said Anthony Sabino, a lawyer who teaches business law at St. John’s University in New York. “Detroit will be at the mercy of its creditors in individual lawsuits spread amongst federal and state courts. That chaos alone could doom the city.”
He compares it to animals in the wild — “wolves rending the carcass piece by piece.”
Emergency manager Kevyn Orr, the state appointee who now controls Detroit’s checkbook, acknowledges things will get worse if bankruptcy is rejected, but he’s not saying exactly how bad.
“The city would go back to where it was. We can’t go back,” he told a business group Tuesday.
The judge’s decision is expected any day now. The opposing unions in the case essentially tried to argue that the pre-bankruptcy negotiations weren’t really attempted in good faith by Orr and his financial team, who had basically already made up their minds to shoot for bankruptcy — but I imagine it would have been rather difficult to negotiate with groups that are still holding on to attitudes like this:
Ed McNeil, special assistant to the president of the American Federation of State, County & Municipal Employees Council 25, downplays the urgency expressed by Orr’s team.
“Eighteen billion dollars — that’s down the road. You’re not talking about money due today,” McNeil said.
Today they’re just getting some of Obama’s BS. (Sebelius is in town to talk health care)
“Those able to pay taxes can easily LEAVE the cities for the suburbs, or relocate to a friendlier state”
I think they have already been through that step.
“Cities/states have taxing ability. “
Taxing more than places where people could relocate to is what got them in this mess. Also, residents are no longer paying their property taxes. The only business of note still in Detroit is GM’s headquarters. I suspect they have a sweetheart deal to stay there.
kick the can.......
Washington, DC: Seventeen trillion dollars? Don’t worry about it, it’s not due today.
Detroit is a scale model of D.C. it’s just a matter of time before they end up with similar results.
Hmm... So what just might happen then is the city is dissolved, assets are turned over to the county to sell off to pay what debt they can, and then everyone else gets screwed, 0 pension, 0 city jobs, etc. Methinks the unions need to work with the city more.
Michigan and Detroit taxes are already so high that the population and the business base has been abandoning the city for decades. Tax increases merely exacerbate the problem. They solve nothing.
They also can sell city parks, community centers, athletic complexes etc. Probably not an action that most elected officials would want to be a part of, but it would be a way out.
Sell to whom? There are literally THOUSANDS of homes and properties in the Detroit area that can be bought for $1... and nobody is buying. Nobody wants to live in this Democrat paradise, and nobody wants to buy or build or relocate there.
Instead, LOWER taxes, and remove most of the oppressive Democrat anti-business regulations and rules, and Detroit might have a chance. Slicing the union pensions and benefits would improve those chances. Nothing else, short of a massive bailout, can possibly work.
Theoretically and historically, the appointment of a judge, master or arbitrator has been to bring fairness and confidence into the resolution of a contract when it is impossible for all contractual obligations to be fulfilled.
Lately these positions may be held by politically biased individuals (either way), thus bringing instability back into the process.
We (and Detroit) are between a rock and a hard place.
It should be. There is a lot of stuff to be liquidated, starting with a very valuable art collection...
THERE ISN'T ANY!
We used to be a nation that lived by the rules of law, until the law makers and law enforcers became the biggest law-breakers. The laws are now unequally applied (I don't like that law, so I'll ignore it, and the one's I like won't apply to me..! --- Federal Government), Ignorned, and now anarchy is rearing its ugly head...
Problem is, Obama's stash is mutating into something strange...
There can be no good faith negotiations with unions because they have no good faith.
“owing more than $18 billion in debt “
Can we make payments? We’ve been out of work.
Detroit taxes are already at the maximum state law will allow. They can’t increase taxation!
They’ll have to find a way to levy user fees and non-user fees too.
Detroit taxes are already at the maximum state law will allow. They can’t increase taxation!
IIRC from their bankruptcy filing, they already have most of those set to beyond extortionate levels.
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