http://www.detroitnews.com/article/20131015/METRO01/310150035/Orr-cuts-Detroit-retirees-health-care-benefits?odyssey=tab|topnews|text|FRONTPAGE
In other news regarding the Detroit Bankruptcy filing:
Today, Federal Judge Stephen Rhodes is hearing arguments on whether Detroit has sufficiently demonstrated insolvency to qualify for a bankruptcy filing, whether the state's Emergency Manager law is Constitutional, and whether the Emergency Manager negotiated in good faith before filing the bankruptcy petition. There are also issues being raised about the legitimacy of reaching for Detroit workers' pensions, and whether state law, which prohibits targeting pensions, is applicable under a federal bankruptcy filing. The hearings will continue for several days, and hopefully the judge will rule on these issues by the end of October.
As I followed along with the live testimony, I was reminded of several public statements Mr. Orr made regarding the City of Detroit's pensions, both before filing the bankruptcy petition, and since. He indicated that the fact that the City of Detroit owed its pension funds money, was his biggest problem. He also said that federal law trumps state law when it comes to the public employee pension protection legislated by the state. And he also indicated that if the state law did apply, he would work to change that law. These were public statements he made in the days leading up to the filing of the bankruptcy petition, and in the days following that filing. So reaching for retiree pensions was and remains at the top of the list of expedients Mr. Orr will exercise in "resolving" Detroit's fiscal problems.
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| Will Federal courts participate in scamming retirees, or will they stop it? |
If Judge Rhodes approves any eventual plan of adjustment that includes cutting retiree pensions, he will set an unusual precedent that, if it is allowed to stand, will have repercussions all across the United States. It will plunge thousands here in Michigan, and millions across the U.S into poverty. Whether Detroit is solvent or not, the pension obligation is sacrosanct and cannot be treated as
a creditor liability. Pensioners are not creditors.
As far as I'm concerned, Mr. Orr, who works for Governor Snyder, has not fully explored other options, and the governor has acted precipitously and recklessly, repeatedly applying the Emergency Manager law in a promiscuous fashion all across Michigan, to school districts, and local municipalities while avoiding the basic problem. The governor increased taxes on retirees receiving public pensions. The state now has a budget surplus, yet the governor has yet to make any real, substantive commitment to Detroit.
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| Can you re-invent a city while breaking faith with the workers who spent a lifetime making it a community? |
The remedies taken at the national level to achieve a continuing economic recovery, have ignored the primary victims, the people and communities who are still suffering. We bailed out the banks, we bailed out the automobile industry, but we have not yet addressed the people who have borne the full weight of state and federal shortcomings. To the retirees, Governor Snyder is saying in effect, "Food Stamps & Foreclosures is your future." The 600,000 public employees and their families in Michigan ought to find that outrageous.
As for those who only look at the bottom line, mouthing platitudes about "just wanting to see people get the services they deserve," and " Let's bring Detroit back as a thriving, world class City," I'd like to know how Michigan, and Detroit recover, when you are taking money out of the local economy by cutting the income of thousands of people, and adding to the Taxpayers' burden by making these public employees eligible for public assistance. Mr. Orr is resolving one problem, by shifting the costs to another entity. Because one way or another, this is going to cost the State of Michigan.
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