State laws re: bankruptcy contribution

[Wesley Mouch]

What is the Detroit taxpayers contribution to our bankruptcy?

Our contribution to the bankruptcy is the fact that we pay the highest property taxes, the highest income taxes, spend the most money on retiree/legacy costs, and receive the shittiest services and return on our tax dollars than anybody else in the state.
...snip...

Certainly basic city services have been shitty -- but Detroiter's decided on other priorities. For example, Detroiters have paid for a Human Rights Department. Detroiter's got that service. Or paying for a mayoral mansion. Nice -- but not the priority of Troy, Wayne, or Ypsilanti. Or how about a paying for a contract compliance department who checks how many whites are working on city jobs.

So stop complaining. Detroiters got value for their money. We just didn't ask for services, we asked for all kinds of irrelevant things that are none of the city's business.

[mwilbert]

Certainly basic city services have been shitty -- but Detroiter's decided on other priorities. For example, Detroiters have paid for a Human Rights Department. Detroiter's got that service. Or paying for a mayoral mansion. Nice -- but not the priority of Troy, Wayne, or Ypsilanti. Or how about a paying for a contract compliance department who checks how many whites are working on city jobs.

So stop complaining. Detroiters got value for their money. We just didn't ask for services, we asked for all kinds of irrelevant things that are none of the city's business.

This is a poor argument. First, because the kind of items you mention aren't and never were a significant part of the budget. Second because Detroiters did not get value for money, because the city has been very badly run. Where I agree with you is that the city residents voted in the people who were unable to run the city, and continued to elect such people regularly for a long time, and that isn't really anyone else's fault.

[erikd]

Certainly basic city services have been shitty -- but Detroiter's decided on other priorities. For example, Detroiters have paid for a Human Rights Department. Detroiter's got that service. Or paying for a mayoral mansion. Nice -- but not the priority of Troy, Wayne, or Ypsilanti. Or how about a paying for a contract compliance department who checks how many whites are working on city jobs.

So stop complaining. Detroiters got value for their money. We just didn't ask for services, we asked for all kinds of irrelevant things that are none of the city's business.

Wrong.

The Detroit Human Rights department has a budget of around a $1 million per year. The expenses for the Manoogian mansion are mostly paid for with private funding. According to a 2006 Detroit News article, the city spent $1.3 million on the mansion since 1994.

In 2012, the city spent 25% [[$300 MILLION DOLLARS!) of its entire budget on retiree health care and pensions.

To be sure, the city spends money on non essential services, but the amounts are relatively insignificant, and not a material factor in the city's financial crisis. Eliminating all non-essental departments and expenditures might cover one or two percent of the city's retiree obligations.

The city certainly should cut these types of expenditures, and they actually have done quite a lot of that, but the savings are not nearly enough to make any noticeable difference in the city's financial position.

[Wesley Mouch]

Wrong.

The Detroit Human Rights department has a budget of around a $1 million per year. The expenses for the Manoogian mansion are mostly paid for with private funding. According to a 2006 Detroit News article, the city spent $1.3 million on the mansion since 1994.

In 2012, the city spent 25% [[$300 MILLION DOLLARS!) of its entire budget on retiree health care and pensions.

To be sure, the city spends money on non essential services, but the amounts are relatively insignificant, and not a material factor in the city's financial crisis. Eliminating all non-essental departments and expenditures might cover one or two percent of the city's retiree obligations.

The city certainly should cut these types of expenditures, and they actually have done quite a lot of that, but the savings are not nearly enough to make any noticeable difference in the city's financial position.

Glad to hear most of the Manoogian is paid for by private donations. Glad you agree with my point. Cut non-essential services, even when politically warm and fuzzy.

I totally agree that $1 million a year won't make or break the city. But do it 100 times, and break it you will -- and we did. Justifying waste on the basis that it doesn't matter much is dangerous and might put our fine city into bankruptcy. Or rather it did.

Is $1 million nothing? I would guess its about the cost of 12 police officers -- assuming actual wages of $40,000 -- and doubling it to cover employer paid benefits, training, and administration. Would 12 more police officers on the beat in Detroit over the last 40 years have mattered? I think so.

[FlyOnTheWall]

Glad to hear most of the Manoogian is paid for by private donations. Glad you agree with my point. Cut non-essential services, even when politically warm and fuzzy.

I totally agree that $1 million a year won't make or break the city. But do it 100 times, and break it you will -- and we did. Justifying waste on the basis that it doesn't matter much is dangerous and might put our fine city into bankruptcy. Or rather it did.

Is $1 million nothing? I would guess its about the cost of 12 police officers -- assuming actual wages of $40,000 -- and doubling it to cover employer paid benefits, training, and administration. Would 12 more police officers on the beat in Detroit over the last 40 years have mattered? I think so.

A million here, a million there, a million over there, a million wherever and pretty soon you are talking about real money.

[mwilbert]

I totally agree that $1 million a year won't make or break the city. But do it 100 times, and break it you will -- and we did. Justifying waste on the basis that it doesn't matter much is dangerous and might put our fine city into bankruptcy. Or rather it did.

The city has gone bankrupt. It wasn't because of spending money on inessential things. It was because it spent money poorly on essential things. The two problems are entirely different, and solving the first will not fix the city's fiscal predicament. This is not a defense of frivolous spending, but pretending that Detroit's problems are the result of frivolous spending is not a step on the path to budget realism.

[Wesley Mouch]

The city has gone bankrupt. It wasn't because of spending money on inessential things. It was because it spent money poorly on essential things. The two problems are entirely different, and solving the first will not fix the city's fiscal predicament. This is not a defense of frivolous spending, but pretending that Detroit's problems are the result of frivolous spending is not a step on the path to budget realism.

Problems are seldom one-dimensional. For results, you generally must fix EVERYTHING. When you think you can just change one thing and get results, you're usually wrong. We need to fix the national financial climate, rust belt economics, urban economics, city services, waste, rigid work rules, borrowing from the future for today [[pensions), and of course stupid spending on non-essential services -- and a hundred more things. Picking your pet item and saying that it wasn't the problem is the problem.

[FlyOnTheWall]

Problems are seldom one-dimensional. For results, you generally must fix EVERYTHING. Picking your pet item and saying that it wasn't the problem is the problem.

Nice turn of words to state the truth

[mwilbert]

Problems are seldom one-dimensional. For results, you generally must fix EVERYTHING. When you think you can just change one thing and get results, you're usually wrong. We need to fix the national financial climate, rust belt economics, urban economics, city services, waste, rigid work rules, borrowing from the future for today [[pensions), and of course stupid spending on non-essential services -- and a hundred more things. Picking your pet item and saying that it wasn't the problem is the problem.

This is nonsense. In something as complicated as a city or a country, you can never fix everything. You fix the stuff that is easy to fix, and as much of the important stuff as you can manage, and hope that is enough.

[Wesley Mouch]

This is nonsense. In something as complicated as a city or a country, you can never fix everything. You fix the stuff that is easy to fix, and as much of the important stuff as you can manage, and hope that is enough.

Nonsense? Naw. Exaggeration? Sure.

You are right. Fix what's easy, and what's important.

And sometimes shake up a few things.

[erikd]

Glad to hear most of the Manoogian is paid for by private donations. Glad you agree with my point. Cut non-essential services, even when politically warm and fuzzy.

I totally agree that $1 million a year won't make or break the city. But do it 100 times, and break it you will -- and we did. Justifying waste on the basis that it doesn't matter much is dangerous and might put our fine city into bankruptcy. Or rather it did.

Is $1 million nothing? I would guess its about the cost of 12 police officers -- assuming actual wages of $40,000 -- and doubling it to cover employer paid benefits, training, and administration. Would 12 more police officers on the beat in Detroit over the last 40 years have mattered? I think so.

It seems that you have completely missed my point.

I am not justifying waste or saying that it doesn't matter, but rather pointing out the fact that, contrary to popular belief, the city has been cutting waste and non-essential spending for years, and there just isn't that much of it left to cut.

All of my posts on this thread are in response to the accusations that Detroiters are just shirking our responsibilities, not contributing to the bankruptcy, shifting the blame to others without accepting any responsibility, etc.

As I have pointed out with numerous examples, this accusation is total bullshit.

The city of Detroit has been drastically cutting city services, subsidies, city employee wages, and has drastically reduced the city workforce.

The city has cut hundreds of millions of dollars in annual spending, and has, in fact, cut much of the "non-essential" spending on things like Cobo Hall, the DIA, the Detroit Zoo, the historical museum, the Belle Isle Zoo, the Belle Isle Aquarium, etc.

In the 2012 city budget, 83% of the money was spent on police, fire, pensions, retiree health care, and debt service. Of the 17% [[$204 million) that was left over, $121 million was used on deficit spending. That leaves $83 million to spend on all city services other than police and fire.

I will agree that there are still a few more non-essential services that should be cut, but the suggestion that there are 100 more $1 million cuts that could be made just isn't true. Most of those cuts have already been made.

[Hermod]

Even in your story, which bears little resemblance to what happened in Detroit, the original seventeen still owe some money here. I don't think anyone is suggesting that the original seventeen would owe the entire bill, or even an equal share. But they can't claim they don't owe anything.

As noted in the story, they already paid. Now the carousers want them to suck up their bills.

[Hypestyles]

I doubt that there's going to be a resolution that won't reduce city services even more.

[Wesley Mouch]

It seems that you have completely missed my point.

I am not justifying waste or saying that it doesn't matter, but rather pointing out the fact that, contrary to popular belief, the city has been cutting waste and non-essential spending for years, and there just isn't that much of it left to cut.

All of my posts on this thread are in response to the accusations that Detroiters are just shirking our responsibilities, not contributing to the bankruptcy, shifting the blame to others without accepting any responsibility, etc.

As I have pointed out with numerous examples, this accusation is total bullshit.

The city of Detroit has been drastically cutting city services, subsidies, city employee wages, and has drastically reduced the city workforce.

The city has cut hundreds of millions of dollars in annual spending, and has, in fact, cut much of the "non-essential" spending on things like Cobo Hall, the DIA, the Detroit Zoo, the historical museum, the Belle Isle Zoo, the Belle Isle Aquarium, etc.

In the 2012 city budget, 83% of the money was spent on police, fire, pensions, retiree health care, and debt service. Of the 17% [[$204 million) that was left over, $121 million was used on deficit spending. That leaves $83 million to spend on all city services other than police and fire.

I will agree that there are still a few more non-essential services that should be cut, but the suggestion that there are 100 more $1 million cuts that could be made just isn't true. Most of those cuts have already been made.

Mostly, I agree. And I respect your comments.

The 83% you cite is where the cuts do need to occur. Cuts don't necessarily mean wages or benefits. It can mean efficiency. My city hall experience [[albeit now a little old) suggests that there's a a lot of places where we can become efficient. And yes, this might involve a smaller bureaucracy.

[erikd]

Mostly, I agree. And I respect your comments.

The 83% you cite is where the cuts do need to occur. Cuts don't necessarily mean wages or benefits. It can mean efficiency. My city hall experience [[albeit now a little old) suggests that there's a a lot of places where we can become efficient. And yes, this might involve a smaller bureaucracy.

I am a huge supporter of reducing waste and finding ways to be more efficient, so let's look at that 83% of the city budget:

36% of the city budget is just payments for bond, pension, and retiree benefits. These are basically just bills that the city pays. There is no complex or inefficient bureaucracy that can be streamlined to reduce these payments. If the city owes $150 million in annual bond payments, we can't just "become more efficient" or make changes to create a "smaller bureaucracy" in order to reduce the amount of our bond debt payments. The same goes for pension and retiree benefit payments. It's not like the city is paying millions of dollars a year for some kind of bloated, inefficient accounts payable department to issue these checks.

32% of the city budget goes to pay for the police department. The DPD officers have had their pay cut to the bone, and are now one of the lowest paid, if not the absolutely lowest paid, police officers in the entire metro area. In addition to the police pay cuts, the city has closed precincts, drastically reduced the number of police officers, and has cut spending on squad cars, tactical gear, and all of the support services that are needed for the DPD officers to do their jobs.

As it stands right now, DPD officers are the lowest paid, most understaffed, and most under-equipped police in the metro area.

The situation is pretty much the same for the DFD, which gets the other 15% percent of the city budget.

I'm sure that there are some additional opportunities for increased efficiency and reduced bureaucracy in the DPD and DFD, because there is no such thing as a large organization like the DPD or DFD that has absolutely no waste or inefficiency.

We should always be looking for ways to reduce waste and become more efficient, but the assertion that departmental waste and inefficiencies are the primary reasons for poor city services is simply not correct.
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If you have some real solutions or alternatives that would actually make a difference, I would love to hear them, and so would all of the underpaid and under-equipped DPD and DFD personnel.

The assertion that waste and inefficiency is the reason for Detroit's financial crisis is like saying that a guy who got laid-off from his job can't pay his bills because he spent $100 on a steak dinner for his anniversary last year.

Should you spend $100 on a steak dinner if you think that you might get laid off next year? It's probably not the best use of your limited funds, but it's also not the reason why you can't pay your mortgage a year later after you have been laid off.

The waste and inefficiency argument against Detroit is pretty much the same thing. As long as people can find any example of waste, inefficiency, or corruption in Detroit city government, THAT is considered to be the problem, while all of the negative impacts of federal de-urbanization, de-industrialization, systemic racism, redlining, etc., are completely ignored and excused as non-factors in the whole situation.

To be clear, I am not saying that Detroit has done a great job of running an efficient, waste free city government. To be sure, we have been far from perfect, and we could have done a better job of managing the decline. However, our shortcomings and deficiencies in decline management are not the root cause of, nor the primary reasons for Detroit's decline.

[Wesley Mouch]

I am a huge supporter of reducing waste and finding ways to be more efficient, so let's look at that 83% of the city budget:...snip...

The waste and inefficiency argument against Detroit is pretty much the same thing. As long as people can find any example of waste, inefficiency, or corruption in Detroit city government, THAT is considered to be the problem, while all of the negative impacts of federal de-urbanization, de-industrialization, systemic racism, redlining, etc., are completely ignored and excused as non-factors in the whole situation.

To be clear, I am not saying that Detroit has done a great job of running an efficient, waste free city government. To be sure, we have been far from perfect, and we could have done a better job of managing the decline. However, our shortcomings and deficiencies in decline management are not the root cause of, nor the primary reasons for Detroit's decline.

Agreed, management shortcomings are not the primary reasons for Detroit's decline. But having worked with DPD closely I disagree on the organizations efficiency.

You're certainly right on starting pay levels -- but the number of officers actually patrolling the city vs. working desk jobs was shocking to me. Even the officers I worked with complained about how few of them were deployed in the field vs. somewhere else. Are we still paying DPD officers to enter payroll? Or did we finally outsource this to free up officers for police work?

This isn't the biggest problem Detroit has -- but much of the resistance to bailing out Detroit comes from concerns about whether Detroit is well-run. No sense tossing money at someone who is still buying steak dinners.

As to your 'ignored factors'... These factors are pretty much the same for every northern industrial city. So then why is Detroit at the front of the bankruptcy line? I think we have a responsibility to clean up our own house. You can argue we weren't treated well by the feds, but it does become a pity party to focus on blame and view our city operation as a non-factor.