Detroit elected a new mayor November 5 and he will take office in less than a month. But the future of this great American city and its citizens isn’t being defined by decisions made by voters on Election Day. It is being defined in federal bankruptcy court—and by an “emergency manager” who has no democratic legitimacy.
With a ruling Tuesday by US Bankruptcy Judge Steven Rhodes, Detroit officially becomes the largest US city ever to enter Chapter 9 bankruptcy. Despite a determination that negotiations with creditors outside of bankruptcy court had not satisfied good-faith requirements, the judge cleared the way for the emergency manager and his law firm to advance a “plan of adjustment” that could include deep cuts in pension guarantees for retired city employees and a “fire sale” of city assets that could might result in public utilities and the Detroit Institute of Arts collection being bartered off to private bidders.
With a ruling Tuesday by US Bankruptcy Judge Steven Rhodes, Detroit officially becomes the largest US city ever to enter Chapter 9 bankruptcy. Despite a determination that negotiations with creditors outside of bankruptcy court had not satisfied good-faith requirements, the judge cleared the way for the emergency manager and his law firm to advance a “plan of adjustment” that could include deep cuts in pension guarantees for retired city employees and a “fire sale” of city assets that could might result in public utilities and the Detroit Institute of Arts collection being bartered off to private bidders.