Today's Coming Crisis Movie

Monday, November 28, 2011

Is Detroit in its end times?

My grandmother used to talk about the end times, and would scour current events and the weather for evidence of the Biblical signs foretelling the Earth's final days.

I find myself doing the same thing with the city of Detroit.

Last week, Mayor Dave Bing provided a clear signal of the city's coming apocalypse. Faced with an existential moment demanding life-or-death decision making, the mayor instead stalled for time.

Detroit is out of time, and Bing's failure to act decisively to turn back the cash flow crisis makes it inevitable that an emergency manager will be appointed by the state to make the hard decisions and common sense reforms that should have been made decades ago.

It won't be pretty. And it may not save the city.

Bing won't slash the 2,300 employees, including 800 police and firefighters, that need to go now to replenish the city's coffers because he's rightly fearful that the impact on services and safety will accelerate the exodus from Detroit. His counter is to promise 1,000 layoffs soon. Not enough. The emergency manager will mail far more pink slips.

Bing is hoping he can avoid mass privatization of city services, including the bus system, by bringing in outside managers to make them more efficient. It's too late for that. The emergency manager will outsource any service that can be provided cheaper by someone else, and buses likely will go.

Bing hasn't put any of the city's "jewels" on the auction block. The emergency manager will hold a fire sale. Say goodbye to City Airport, the city's power plant, and anything else that isn't nailed down. Selling assets to clean up the balance sheet will be Job One.

Bing has been overly patient with the city's unions, hoping they'll ultimately come to Jesus on giving concessions on health care, pensions and pay. They won't. The emergency manager will tip over the bargaining table and achieve those savings with the stroke of a pen. more