The city of Detroit, which has been basically issuing bonds to pay for daily expenses since 2005, is in such bad fiscal shape that even people who bought exurban McMansions in 2005 with reverse-money-down ARMs think the city is in a financial mess. That’s why America’s favorite pro-”right-to-work” nerd-governor, Rick Snyder, is going to appoint an emergency manager to gut pensions restructure the city’s finances.
Emergency management is a pretty severe budget-cutting process but Detroit is in such bad shape that even the guy who runs something called michiganliberal.com is like: Yeah, Detroit kind of needs this pain. Which is true because Detroit has been on the brink of running out of cash for the better part of a year, but it’s also one of those things where what did people expect? When a region of 4.4 million people literally concentrates its poverty and abandonment in a city of 700,000 (with an ever-shrinking middle-class population, fed up with a municipality with both high taxes and poor public services) things can only end badly.
But why wallow in these big issues of “good governance” and “regionalism” when we can speculate who Snyder will select as Detroit’s very own Chris Traeger? Even national pundits like Charles Lane and David Weigel are getting into it.
On “Fox News Sunday,” Washington Post opinion writer Charles Lane suggested the former GOP presidential nominee and turnaround expert at private equity firm Bain Capital should get the job of turning Detroit around.
“You do see that Mitt Romney is a person with a lot of ability and a lot of energy. Who still has got a lot to contribute, and, you know, his hometown of Detroit, right now, has just been put into state receivership or it’s about to be,” Lane said. “I wonder if there is no role for him in the restructuring of Detroit. He’d be the perfect person to do it. He has got the expertise, he’s a hometown guy, and he is a kind of a political free agent at this point. That is the kind of thing that he could, I think, contribute in the future.”Related video
Last week, Dave Weigel writing in a piece for the online magazine Slate titled “Give Detroit to Mitt Romney,” first suggested the move.
This is a terrible idea and not just because Mittens is an insufferably entitled twit with no experience with municipal finance.
Appointing an EM to run Detroit is hugely controversial. For the process to be successful in any way, the EM needs to be someone who can assuage fears about the state effectively gutting city government, work collaboratively with stakeholders, etc. etc. Mittens cannot do that because Detroit literally hates Mitt Romney. As a presidential candidate, he barely polled 2% in Detroit. During the GOP primary, Yr Wonket spent an hour at the Detroit voting precinct in Mittens’ boyhood neighborhood. Of the two Republicans who voted that hour, one voted for Rick Santorum and the other voted for Ron Paul. Mitt Romney can’t even win over Republicans in the still-affluent Palmer Woods community he grew up in, but sure AFSCME will totally let him re-write labor contracts without completely losing their shit.
The whole argument about Romney’s skill as a “turnaround artist,” as Weigel put it, is also bollocks. Bain Capital’s turnaround strategy involved buying companies, piling on debt to pay Bain’s management fees, and then declaring bankruptcy. Detroit’s elected leaders have already been literally doing that for several years. They’ve masked annual budget deficits with long-term borrowing, handed out lucrative public contracts to politically connected vendors, and are at a total loss as to what to do with the city’s billions in debt. Detroit, right now, isn’t like a company that Mitt Romney wants to buy. It’s like the debt-ridden hulk of a company that Mitt Romney is ready to ditch. Literally.
Detroit is literally screwed.Related