State laying groundwork for managed bankruptcy for Detroit | The Detroit News | detroitnews.com
This is what one might call "end stage blue governance", which we see being manifested all over the country, but especially in California. There's nobody who can bail Detroit out, too much debt is involved and there's no political support for it.Even as the state Treasury prepares to begin another financial review of Detroit's books, a plan is being solidified in the governor's office that would guide Michigan's largest city through what is being called a managed bankruptcy.
The working concept, still evolving, assumes that the state's financial review would find severe financial distress in Detroit, that Mayor Dave Bing and City Council would be unable to push through overdue restructuring, and that the process would culminate in appointment of an emergency financial manager under Public Act 72.
Under this law the mayor and city council will literally be stripped of their authority, and the city will be run by the state government. The city is about a month away from running out of cash, and at that point an emergency financial manager will be appointed.
The mayor and city council for their part remain in denial. They have made no moves to avert the crisis at all, waiting like children for the grown ups to show up apparently.