Friday, December 02, 2011

Mayor Bing Doesn't Want a Financial Review. Will It Matter?

Mayor Dave Bing
Mayor Dave Bing held a joint press conference yesterday afternoon, which included several members of the Detroit City Council as well as prominent labor and community leaders. The consensus that each of these people delivered is that they did not want Governor Rick Snyder to launch a financial review, which is the first step in the appointment of an emergency manager to run the City. "Detroit," Mayor Bing proclaimed, "needs to be run by Detroiters."

Mayor Bing went on to remind everyone that he has a plan; one that he believes will lead the City of Detroit out of its current financial crisis. (Outline of said plan available here.)

The question that one ultimately has to ask, though, is: will any of this really matter?

For starters, Mayor Bing's plan begins with a 90% increase in Detroit's corporate income tax rate. This is offensive, to say the least, to Governor Snyder and the Legislature, who would have to grant their approval before such a tax increase can go into effect.

The Bing Plan also calls for the Detroit Public Schools to pay $15 million in charges that it currently owes. While no one disputes the legitimacy of that debt, the fact remains that our school system isn't in any shape to pay anyone $15 million at the moment. Trading a financial crisis in our local government for an even deeper one with our local public schools doesn't solve matters.

Regardless of that, I have no doubt that Mayor Bing and his staff will find a way to make it through our current financial crisis. But then what?

The City of Detroit has had one financial crisis like this after another for the past several years. Once they patch the budget for the current problem another one will be here shortly.

The Detroit Police Department currently has the largest budget of any police department in the nation on a per resident basis. In spite of this, it also has the worst response time of any urban department.

More than a few residents and businesses have already decided that they are tired of this and are leaving Detroit. When they go, they leave the City of Detroit with yet another vacant home or commercial building that must be dealt with as well as less tax revenue to work with. With less tax revenue to work after those departures, another financial crisis becomes inevitable.

Governor Rick Snyder
This has become the story of Detroit. To quote the great Yogi Berra, "It's like deja vu all over again."

Mayor Bing has not proposed anything that will truly turn the City of Detroit around nor will his plan change the recurring state of financial crisis in our community. His plan will only hold our local government together until the next crisis hits.

In the absence of any true change, and with the knowledge that a financial review by the State of Michigan is likely inevitable at this point, one has to ask: what do we gain by putting it off?

Delaying the inevitable does nothing to benefit the residents, businesses, and visitors to our great city. If anything, it only serves to spread the misery. As Detroit's slow financial collapse drags on, it puts an ever growing strain on neighboring communities. Spreading this misery does not benefit anyone.

Therefore, I have to conclude that we may as well get this over with and let the financial review begin as soon as possible.
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