When you promise future benefits that can't possibly be paid, you end up like Detroit:
"I object to being referred to as a creditor," said retiree Paulette Brown, a former water department employee who got notice of the bankruptcy because her pension is at risk. "What I am is a dedicated public servant … Who's going to prison for the proposed cruelty to retirees?"Less compassionate commentators make the observation that Detroit was obviously heading down the tubes and future promised income was at risk, but that's a pretty sophisticated observation to make from the point of view of a low-level government employee who believed that her pension money was safe and now is faced with a huge chunk being taken out of it through no fault of her own.
I have slightly less sympathy for Cynthia Blair, on a $3,000-a-month pension from her police sergeant husband. This is $36,000 per annum - and very little, if any, tax taken off that - which goes a long way in Detroit. Even the headline figure in sterling is £22,500, which is a seriously good pension. Perhaps if pensions had been less generous in the past, Detroit wouldn't be in such a mess in the present.
In the end, though, you can't fight the math, as resident Jean Vortkamp discovered:
Jean Vortkamp, got emotional as she described the bleak state of city services. She said the body of a young murder victim remained on her street for five hours before being removed.Well, Ms. Vortkamp, why are the city services so appallingly poor? It's because they have no money. Why do they have no more money? Because 25% of it is already being spent on pensioners and the police and fire department costs have exploded. The city is not getting anywhere near the bang per buck that it used to.
"Detroit is not an airline or a cupcake company. We are a family that deserves respect," Vortkamp told the judge.
I have no idea how Detroit can be fixed. I have serious doubts it can be fixed. You can't magic new income for the city - profitable people and companies are leaving the city rather than be taxed to the hilt. You can't stop spending on the police force, the murder rate is bad enough already. The federal government won't touch Detroit with a bargepole, since any federal intervention will set a precedent for unbounded claims on the government as other major cities follow Detroit. Razing Detroit to the ground and sowing the earth with salt is rhetorically attractive but glibly skips over the pensioners who had a not unreasonable expectation of adequate provision for their old age and are left with little.
If you want to pin the blame on anyone, I'd start with the mayors of Detroit, especially those since 1960 when the employment and spending really started to get out of hand:
- Louis Mirani (R) 1957-1962
- Jerome Cavanagh (D) 1962-1970
- Roman Gribbs (D) 1970-1974
- Coleman Young (D) 1974-1994 (yes, 20 years in power)
- Dennis Archer (D) 1994-2001
- Kwame Kilpatrick (D) 2002-2008
- Kenneth Cockrel Jr (D) 2008-2009
- Dave Bing (D) 2009-present