Detroit files for Chapter 9 bankruptcy [UPDATED: Detroit is Eligible]

Originally posted by madmac5150
reply to post by jimmyx

 

The state of Michigan is not bankrupt... the city of Detroit is.

now let's see, what would be the reason that the state of Michigan would let it's LARGEST city go into bankrutpcy????.....hmm...can't put my finger on it

reply to post by jimmyx

The Governor is responsible for the financial status of the municipalities.....if they run into trouble, he is required to offer a way for them to gain a sounder financial footing.
I believe one or two smaller cities are already on the road to recovery.

Seems to me, part of the problem is the previous governor didn't take that mandate seriously.

I wonder what will happen there now with police and other emergency response units.
Maybe they will try out marchal law?

reply to post by xuenchen


Flash back 2012

“[W]e refused to throw in the towel and do nothing,” Obama said. “We refused to let Detroit go bankrupt, I bet on American workers, and American ingenuity and three years later that bet is paying off in a big way.”

Apparently not and Detroit files for bankruptcy.

When does America get to file chapter 9?

reply to post by tyfon


Whatever money is coming into the City is going for city services....so it should actually be much better than it is now.

The whole idea is to get the city back on its feet financially after decades of corruption, mismanagement and greed.

I have not heard one word about martial law....although the State Police are helping out.

The mayor said the money will be divided amongst city workers but alot of it will go to Police/Fire/First Responders because they are a vital part of the city that people can't go without.

I lived in the heart of Detroit almost a decade ago and, although I hated it, I still feel sad about this news.

This is what happens when there is free access to money that isn't yours and you didn't earn.

About time. didint they want to declare bankruptcy in 09/10?

Also... This isnt the first time a city has declared bankruptcy.

List of Bankruptcy Filings Since January 2010

All Municipal Bankruptcy Filings: 36

City and Locality Bankruptcy Filings (8):
-- City of Detroit
-- City of San Bernardino, Calif.
-- Town of Mammoth Lakes, Calf. (Dismissed)
-- City of Stockton, Calif.
-- Jefferson County, Ala.
-- City of Harrisburg, Pa. (Dismissed)
-- City of Central Falls, R.I.
-- Boise County, Idaho (Dismissed)

www.governing.com...

Collective bargaining
Municipalities' ability to re-write collective bargaining agreements is much greater than in a corporate Chapter 11 bankruptcy[11] and can trump state labor protections,[12] allowing cities to renegotiate unsustainable pension or other benefits packages negotiated in flush times.[13]

WIKI

Pensions are what this is targeting, I suspect.
Unions were heavily invested in municipal bonds, and those bonds aren't worth squat right when the pensioners are collecting what they are owed.

this vid has been around for awhile but doesn't hurt to see it again

Originally posted by jimmyx

Originally posted by madmac5150
Looks like progressive politics is a rousing economic success... Detroit has been run by the progressives and labor unions for a very long time. Look to them to restore hope and change in the Motor City...

Man, my sarcasm meter is pegged today...

republicans have controlled the entire state since 2010, what a fine job they have done
the state senate of Michigan has had a republican majority since 1983.

here's a simple graph with colors, for all you people that don't do research.
www.flickr.com...

Which had NOTHING to do with the mismanagement of Detroit by it's own elected officials Look at it's previous Mayor before Bing and any videos of City Council and you will see. Corruption runs deep in the City apparatus and it has permeated everywhere in Government there.

Detroit ran itself into the ground and was totally counting on SOMEONE else bailing them out, with no strings attached. "Just send us the money, we'll take care of everything" was their actual thought process, i'm not kidding. The only area that is still hanging on by a thread is the downtown area and that is at the expense of the rest of the neighborhoods that make up the "real" City.

I'll give you a tour if you doubt me.........

I have yet to read the links on Chapter 9 that were linked earlier here, but this is a short and interesting explanation.
Basically, little information about negotiations have been in the papers....and what has been printed is often conflicting or poorly written...or both.

The first thing they file is a motion to dismiss the case because the pre-petition, the pre-filing negotiations were not in good faith. There is an atmosphere of bullying and intimidation and threats," said Graves.

Judges have thrown out Chapter 9 filings after a year because they did not qualify. Should Detroit succeed, the negotiations begin in earnest with the end game of a final Chapter 9 settlement where the haircuts abound.

"This is really about creditor democracy. And as the case moves forward the creditors get to examine, develop information, find out what's really going on. They are owed reports and then down at the end of the game they vote up or down on this thing," said Graves.

www.clickondetroit.com...

As someone that is familiar with this topic, I can tell you that the news is sensationalizing this story in an alarmist fashion. Don't believe the hype.

This is actually good, if not great news for the city. The governor made the right decision to appoint an Emergency Manager. The appointed Emergency Manager is a level-headed, rational individual and has handled his role impeccably. He should be commended for a job well done, in large part because he is looking out for the best interests of the citizenry.

The whole goal in this bankruptcy is to stave off the vampires....err, creditors that have been sucking the treasury dry.

City services - fire, police, and the like - will be preserved and improved because the funds that would have been used to pay exorbitant interest will now be channeled to improve city services. The life of the average work-a-day citizen will improve, especially when this debt is finally erased and/or restructured.

There is a lot of investment in Detroit to rebuild the infrastructure. The automotive industry is primed - according to most analysts that study the industry - to grow rapidly over the next 5 years or more, which will improve the economic situation in metro-Detroit considerably.

Once the debt is restructured, you will continue to see more investment in the city and its infrastructure. With better police response times, and better city services, crime will decrease. The ultimate goal will be to bring back more people that will want to live in the city - We are already seeing many young, urban professionals moving to Detroit in recent years.

Thats a damn shame what happened to Detroit. They got hit hard.

My prayers for those who live there. Hope things pick up.

so, does this mean we can just bulldoze the whole place into lake michigan now and start over?
If the same sort of crooks stay in charge of things there, the city will be bankrupt again in 10 years.

reply to post by Tardacus


Detroit is nowhere near Lake Michigan.

The mayor and city council have been stripped of their power for now.
The Current Mayor is not a crook...you must be thinking of the previous mayor....in prison and awaiting sentencing.
The current council: off the top of my head: one is now Orr's assistant....one resigned due to health issues...another "resigned" after he went AWOL....another will not run again....that only leaves I think three who will be around after January 1st.....for now vacancies will not be filled....saving the city tens of thousands......

Originally posted by neo96
reply to post by xuenchen

 

Flash back 2012

“[W]e refused to throw in the towel and do nothing,” Obama said. “We refused to let Detroit go bankrupt, I bet on American workers, and American ingenuity and three years later that bet is paying off in a big way.”

Apparently not and Detroit files for bankruptcy.

When does America get to file chapter 9?

I respect what your saying but Obama has nothing to do with Detroit. That cities doom was spelled out well before he took office. The city has not been able to sustain itself for a decade and even with the desperate measure of allowing casino gambling, it has failed to sustain the capital to continue to run the city.

The death blow to Detroit was the patriot act. The implementation of a passport needed to cross the the bridge sealed it's fate. Nobody does that anymore because of draconian federal law enacted by the patriot act. In the months and years ahead, you will see other border cities suffer the same fate.

There should be a new video series, instead of "girls gone wild" we should document "federal government gone wild" because they are expanding the record books at an alarming rate. Stalin would be extremely proud of the U.S. at this juncture. No other nation claims to have a free society yet dominates them so violently and completely with absolutely no recourse other than law suites that OTHER CITIZENS have to pay for lol.

It's a joke. Cops, prosecutors, the Department of Justice, anyone who brings unjust charges against any citizen should have to be accountable for themselves without district protection because that district is the the tax payer......... You... And I.

If you arrest and prosecute somebody, you better have a damn good reason because if you don't, your going to be held accountable and so is the district you work in. That is the way of truth, justice and real freedom. The way it is now is that they arrest, assault, abuse, kill you and if they are found guilty of ANYTHING later, the tax payer flips the bill while the officer or person in question at worst gets an honorable discharge from service.

This will not do in this day and age. Everyone from the top down needs to accept responsibility for their own actions from the POTUS to the lowest level LEO. Only then can you have true justice.

Originally posted by CookieMonster09

This is actually good, if not great news for the city.

Yes and no, when bankruptcy is declared you are asking to have your debts discharged. There are far reaching effects for those to whom you owe money, from small businesses to large government suppliers, and banks. There will be a domino effect which the government needs to keep an eye on.

Its not the city itself that gets to wipes it debts, those who are owed money will get hit hard. A lot of business may fold as a result.

Originally posted by Ameilia
reply to post by xuenchen

 

The poor people of Detroit who are stuck there. Bankruptcy means there may be no services we are all used to, such as:

-Trash pick up
-Emergency response like police, fire, and medical
-Road maintenance like potholes filled, red lights operating properly, road signs in place and displaying correct information, and street sweeping/cleaning
-Public transportation, the poorest generally rely on buses the most

edit on 7/18/13 by Ameilia because: spelling, clarity

I'm not making light of their predicament, but when I read your list, I couldn't help but think that people living there will know what it is like living in a rural area.

I wonder what will happen? Can and will the federal government bail them out? I am reminded that the federal government bailed out the big corporations, ensuring that the uber-wealthy remained uber-wealthy, but when it comes directly to helping the little guys, what will the government do? I opposed the bailing out of the large corporations, but that happened because of their influence and penetration of the US government. The government should be bailing out Detroit, as it is a better cause than making those already rich even richer.