Nolan Finley thinks Detroit hasn't sufficiently paid for the sins of filing bankrupt.

[hewettbr]

This doesn't make any sense to me either. Do you really think there are leaders, or voters for that matter, in other municipalities in the area that look at Detroit and say to themselves, "We should be more like Detroit. Let's spend lots of money [[or cut lots of taxes), even if we destroy our town's finances; bankruptcy isn't so bad."? If nothing else, you seem to be neglecting all the bad stuff that happens before you get to bankruptcy--the part where you lay off lots of city employees, and cut services and get an EM. I don't think this is an attractive package at all, even with a relatively easy bankruptcy.

And, if it were, how much would making Detroit's bankruptcy less easy help?
Remember that the chickens don't come home to roost that quickly--if I were a mayor and wanted to be irresponsible chances are I could serve a couple of terms and retire before the consequences became evident. Voters do not pay attention to or understand things like assumed rates of return on pensions, or the terms of asset privatizations, and these can easily be manipulated to make the current books better and the future books horrible. The correct assumptions to make about these kinds of transactions aren't even agreed among professionals.

Here is a concrete example. How many people were really paying attention when Detroit made that horrendous debt swap related to the POCs? Note that the reason that the debt swap was horrendous wasn't primarily that the interest rate bet embedded in the swap turned out to be a bad bet, although it was in fact completely wrong, but because even if it had been correct Detroit was virtually certain to violate the associated covenants, resulting in large and needless penalties. How many people know what a debt swap is? How many people, knowing what a debt swap is, are going to look at the covenants and understand their implications? Do the News or the Free Press have writers who could even write such a story, assuming they were assigned to do so? How exactly are people supposed to evaluate whether their elected officials are behaving appropriately?

Both the theoretical problem and the theoretical cure are implausible.

you are totally off my original topic, all I did was give my opinion on the article and how i don't believe the OP was correct in his views. You are going into some whole other debate and I'm not even sure how we got there.

[hewettbr]

Finley is right. If this had really been painful, we'd be hearing talk about reform. All we hear now is how everything's gonna be OK if you trust me.

I agree, just because he made this statement doesn't mean he wants to see the city and its residents suffer though.

[hewettbr]

From whom would we be hearing talk of reform? The only entity that can reform this is the state of Michigan. And, as I wrote earlier, I think that they should; specifically that we need both clear rules about what is acceptable, and oversight to make sure the rules are followed. But if you think that having made the bankruptcy more painful for Detroit would have somehow facilitated that, I disagree with you.

If you want reform, the actual problem is that the bankruptcy was basically painless for Michigan. If the state had been held responsible for the debt [[implausible) or at least for making the pensioners whole [[somewhat plausible), I think you would have seen rapid action at the state level. As it is, I think too many legislators look at this as a Detroit-specific problem, which it really isn't.

i don't think you're on the same page as everyone here. I don't know if there is a misunderstanding or if you are just conveying your message in a way i don't quite get.

The talk of reform would be by the residence, city council and state if the bankruptcy went badly and people were suffering. That is what happens when you are negatively reinforced, you learn not to make the same mistake.

[EastsideAl]

I'm trying to figure out where there hasn't been "negative reinforcement". No streetlights, parks unmaintained and grown over, streets full of unfilled potholes, a broken water and sewerage system that needed to be partially given away in order to save it, limited snow removal, super slow police, fire, and EMS response, and calls to city agencies that go unanswered. To say nothing of the loss of our democratic rights, or of the people who worked and paid in good faith most of their adult lives who will now see cuts in their pension and health care, with many even having to pay back part of their retirement savings.

It all seems pretty damn negative to me.

With this talk of imposing yet more "negative reinforcement" on the citizenry an already heavily impoverished city, I have to wonder where the "negative reinforcement" is for our state. Lest we forget, a factor in tipping Detroit into bankruptcy was the state reneging on its revenue sharing for decreased taxation deal. Costing us hundreds of millions of dollars. And not letting the tax rate go back to where it was before, depriving us of many millions more.

To compound this, rather than just paying us the damn money they still owed, the state got to worm its way out of screwing us over by sending down the EM to "manage" us immediately into bankruptcy. Meaning that they got to essentially fold their own non-payment into the bankruptcy proceeding and wiggle free. Which is one reason why not everyone here feels like Lansing has our backs in all this. However, this is all just "water under the bridge" now I guess, and should be forgotten in the neat settlement of the bankruptcy.

Which it would be until assholes like Finley [[and apparently some posters here) poke their head up to tell us that we haven't suffered enough, or been "negatively reinforced" enough, to satisfy them. I guess if he was our massa [[rather than Mr. Orr) he'd make sure that ol' whipping post would be getting more use...

[nain rouge]

The bond insurers [[that's really who you're writing about, not really "banks") got hammered, as well they should have.

Here's what the Free Press wrote about the swaps:

Orr said this morning that he had conversations with the SEC about filing actions against UBS and Bank of America Merrill Lynch, which collectively provided interest-rate swaps on a $1.4 billion pension debt deal originating in 2005.

He did not say how the SEC responded to his request. The Free Press reported in September that the deal might have been illegal.

Orr’s testimony came during a bankruptcy trial over whether the city can pay $165 million to the banks to get rid of the swaps.

The city reached a new settlement on Christmas Eve with the banks to get rid of the swaps with newly borrowed cash from London-based Barclays. The new deal amounted to a $65-million discount off a previous settlement of $230 million.

Today, Orr acknowledged "serious questions" about whether the city owes a dime on the deal, saying the city might have a "potential fraud claim" against the banks.

Why don't you send in your correction to them?

[hewettbr]

I'm trying to figure out where there hasn't been "negative reinforcement". No streetlights, parks unmaintained and grown over, streets full of unfilled potholes, a broken water and sewerage system that needed to be partially given away in order to save it, limited snow removal, super slow police, fire, and EMS response, and calls to city agencies that go unanswered. To say nothing of the loss of our democratic rights, or of the people who worked and paid in good faith most of their adult lives who will now see cuts in their pension and health care, with many even having to pay back part of their retirement savings.

It all seems pretty damn negative to me.

With this talk of imposing yet more "negative reinforcement" on the citizenry an already heavily impoverished city, I have to wonder where the "negative reinforcement" is for our state. Lest we forget, a factor in tipping Detroit into bankruptcy was the state reneging on its revenue sharing for decreased taxation deal. Costing us hundreds of millions of dollars. And not letting the tax rate go back to where it was before, depriving us of many millions more.

To compound this, rather than just paying us the damn money they still owed, the state got to worm its way out of screwing us over by sending down the EM to "manage" us immediately into bankruptcy. Meaning that they got to essentially fold their own non-payment into the bankruptcy proceeding and wiggle free. Which is one reason why not everyone here feels like Lansing has our backs in all this. However, this is all just "water under the bridge" now I guess, and should be forgotten in the neat settlement of the bankruptcy.

Which it would be until assholes like Finley [[and apparently some posters here) poke their head up to tell us that we haven't suffered enough, or been "negatively reinforced" enough, to satisfy them. I guess if he was our massa [[rather than Mr. Orr) he'd make sure that ol' whipping post would be getting more use...

Negative reinforcement like pension cuts much more severe than they ended up being. The privatization of more services, the loss of more jobs, the further decline.

Bankruptcy has improved things, hence the no negative reinforcement comment. Can we not agree things could have been much worse? Yes things were bad but they are improving, trash gets picked up, roads are somewhat plowed, police have come when i have called, blight is being removed, streets are lit up...

whether all of that was directly due to the bankruptcy or not doesn't matter. People will associate it as such.

[Wesley Mouch]

I'm trying to figure out where there hasn't been "negative reinforcement". No streetlights, parks unmaintained and grown over, streets full of unfilled potholes, a broken water and sewerage system that needed to be partially given away in order to save it, limited snow removal, super slow police, fire, and EMS response, and calls to city agencies that go unanswered. To say nothing of the loss of our democratic rights...

What democratic rights were lost?

[Jimaz]

What democratic rights were lost?

First, remove your fingers from your ears.

[Wesley Mouch]

First, remove your fingers from your ears.

Do i have to?

[Jimaz]

Do i have to?

Well, there's not much point in attempting to comprehend — or influence — until you do remove your fingers from your ears. But do carry on regardless. Whatever.

[Jimaz]

As democracy resumes in Detroit, people must vote

During my last year in office, the democratic process was aborted when the governor appointed an emergency manager and took control of the city's operations and finances....

Now, 18 months later, some control of the city is being returned to the mayor and City Council, where it belongs. That is a good start to restoring democracy in Detroit....

We must return democracy to our city....

Government must work for everyone....

Democracy should preserve the rights of all citizens....

When politicians don't live up to their promises, we need to hold them accountable and remove those who have trampled on the democratic process.

Only then can we fully restore democracy to Detroit and all of Michigan.

[Willi]

Snyder was elected by the people in a peaceful democratic manner
Michigan Republican Governor Rick Snyder has won re-election in 2014.

There are ""levels"" of democracy and city council
is on the bottom of the totem pole for a Michigan city.
The Governor would be at the top, so he calls the shots,
NOT the other way around, never ever.

It's bit like a STATE cop versus a County cop, versus a city cop, versus mall security

[Wesley Mouch]

the As democracy resumes in Detroit, people must vote

Jster, thanks for posting. Perfect proof that Bing was a fool. Why does this man need to carry water for the Democratic party and repeat their talking points -- take 'cuts-only model' -- is he serious? The bankruptcy process was nothing at all like 'cuts-only'. In fact, cuts-only was more true while he was steering the ship. On the contrary, more good has been done by this bankruptcy steered by a Democrat [[Orr) than anything in the last 20 years. And very little good was being done by his job at the helm. He speaks the words of a fight for voters, but in fact helped condemn them to their sad fate, chasing away honest help for political gain. Makes me sick. I used to defend him on this forum. That article finishes him in my eyes. Nothing but pandering to the common denominator. No leadership. What office or job is he gunning for? We won't be seeing him in charge of the Bar Association.

[Jimaz]

Jster, thanks for posting....

You're welcome.

How do you type with your fingers in your ears?

[Wesley Mouch]

You're welcome.

How do you type with your fingers in your ears?

Amazing that I can keep my fingers in my ear to ignore the roar of stupidity around me, yet my computer types powered only by brilliant thought.

[Det_ard]

Bing was in way over his head as Mayor. He couldn't even run his business, his customers had to do a version of the EFM, bring in qualified managers and execs to run his business so they could get the parts out and not shut down the OEM's assembly line. No one listens to Bing. Nice guy, but a multilevel Peter Principle example.

[Jerry Van]

Wow, a know-it-all malcontent doesn't agree with something. How shocking.

[Jimaz]

The Real News, published on November 13: The Post-Bankruptcy Plan for Detroit

It is a blow to retirees and falls short of mitigating the circumstances that lead to the bankruptcy in the first place says Journalist, Curt Guyette and Reverend David Alexander Bullock