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  1. #1
    ENT
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    Detroit is Broke!

    Detroit is eligible for the biggest municipal bankruptcy in US history because the city is broke and negotiations with its thousands of creditors were unfeasible, a federal judge has said in a wide-ranging ruling that also said the city could cut retiree pensions.

    The ruling by US Judge Steven Rhodes marks a watershed in the history of Detroit, once the cradle of the US auto industry and now a symbol of urban decay and mismanagement.

    Detroit's state-appointed emergency manager, Kevyn Orr, had painted bankruptcy as Detroit's best bet for a return to financial stability, and Rhodes' ruling will now give Orr and other civic leaders an opportunity to test that argument.

    "It is indeed a momentous day," Rhodes said as he read aloud for more than an hour from a written statement in a packed courtroom. "We have here a judicial finding that this once-proud and prosperous city cannot pay its debts. It's insolvent. It's eligible for bankruptcy. At the same time it has an opportunity for a fresh start."

    Detroit's labour unions, retirees and pension funds, all of which likely will bear the brunt of austerity measures Orr plans to impose, had argued against the city's bankruptcy in a nine-day eligibility trial. Orr has said he plans to impose a restructuring plan by the end of the year.

    Rhodes also said that the city could cut pensions as part of the restructuring, despite the argument that Michigan's constitution protects them from being slashed. However, Rhodes warned he will not rubber-stamp any pension cuts.

    "Nobody should interpret this holding, that pension rights are contract rights, to mean that this court will necessarily confirm any plan of adjustment to impair pensions. It will not casually or lightly exercise the power under federal bankruptcy law to impair pensions," Rhodes said.

    He declined to stay the bankruptcy proceedings as potential appeals proceed through the courts. He also turned down an effort to allow any appeals of his ruling to go directly to the 6th Circuit US Court of Appeals. Rhodes declared that motions to appeal the case must first be filed in bankruptcy court. Rhodes previously stayed all state court action in the case.

    The American Federation of State, County and Municipal Employees Council 25 filed a notice of appeal of Rhodes' ruling in the bankruptcy court.

    In his lead-up to the ruling, Rhodes went through key arguments made by the city's labour unions, retirees and pension funds opposed to the bankruptcy. He found that Chapter 9 of the federal bankruptcy code is constitutional and while Michigan's constitution protects public pension benefits as contracts, those contracts can be impaired in a municipal bankruptcy.

    The judge also found that the 2012 Michigan law that allowed the city to file for bankruptcy with the governor's authorisation was constitutional.


    The ruling begins a new chapter in the case that first arrived in federal court with Detroit's July 18 bankruptcy petition. As emergency manager Orr works toward submitting a plan to readjust Detroit's more than US$18 billion in debt - to be accomplished chiefly by forcing creditors to take a discount on what the city owes them - an appeals process will begin in the federal courts.

    STRUGGLING CITY

    Detroit is burdened by US$18.5 billion in debt as it struggles to provide even the most basic services to the city's 700,000 residents.

    About 40 per cent of the city's streetlights do not work and

    about 78,000 abandoned buildings litter the city, whose population peaked at 1.8 million in 1950.

    In some respects the Detroit Institute of Arts has become symbolic of the costs of allowing Detroit to fall into bankruptcy. Last week, a group of the largest creditors asked Rhodes to order an independent valuation of the museum's 66,000-piece collection.

    One of the city's most prized cultural assets, the museum includes paintings by Vincent van Gogh and Henri Matisse, an original cast of Auguste Rodin's "The Thinker," and a fresco mural by Mexican artist Diego Rivera. Christie's has not yet issued its valuation of the museum's collection.
    Detroit city is bankrupt - court | Stuff.co.nz

  2. #2
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    Regardless on the debt. Selling off the museum's collection will not even make a dent.

    So it should be left intact for future generations.

  3. #3
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    Quote Originally Posted by ENT
    Detroit's labour unions, retirees and pension funds, all of which likely will bear the brunt of austerity measures Orr plans to impose
    I really do not know why amerkins put up with this bullshit. It is not their money to take- it is Yours. I mean, if I go broke am I allowed to come by and make off with your car?

  4. #4
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    The whole thing is quite fascinating really.
    A modern American city falling to ruin.

  5. #5
    Thailand Expat Bobcock's Avatar
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    Looks like Calcutta

  6. #6
    ENT
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    Cleaner.

  7. #7
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    They'll be making Nikes there soon.

    Why don't some local residents plant these derelict blocks with veges & fruit?
    I mean poverty & unemployment are rife, no fekker eats decently, inner city shops don't even carry fresh stuff.

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    ENT
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    There's loads of unoccupiedcspaces all over the world all too uneconomical to rejt out and others are surplus homes and lands etc, totally going to waste. Let the people use the spaces, grow food, live in/ on it and help support themselves in some way.

    The only problem would be in regulating the areas conferned, unless local community councils ran the plafes.

  9. #9
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    Do something useful, sell it to China.

  10. #10
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    Quote Originally Posted by leemo View Post
    Do something useful, sell it to China.
    They probably already own it!

  11. #11
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    Are those pictures real? 4am shots or something???

  12. #12
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    Funny how Americas Billionaires go from strength to strength, and the country is in shit st

  13. #13
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    Quote Originally Posted by sabang
    Why don't some local residents plant these derelict blocks with veges & fruit? I mean poverty & unemployment are rife, no fekker eats decently, inner city shops don't even carry fresh stuff.
    I don't have a source ready but actually I did see a documentary of locals doing just that a while ago.

  14. #14
    I don't know barbaro's Avatar
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    There are a couple / few threads on Detroit.

    Please see the thread in Speaker's Corner.

    Bumping now.

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