Detroit Is Beta-Test of the GOP Plan To Sell The Federal Government to Corporations

[Scuba]

http://www.politicususa.com/2013/07/20/detroit-beta-test-gop-plan-sell-federal-government-corporations.html

Republicans have long sought to sell off government assets they claim are prohibitively expensive to private, for-profit enterprises they claim are better equipped to administer them because they will base operations on sound corporate business models. What Detroit is experiencing is the Bain Capital vulture capitalist tactic of taking over a company, leveraging it with debt, declaring bankruptcy, and selling off assets and firing union employees all while turning a profit. Michigan governor Rick Snyder followed Bain’s tactics in appointing his cohort to lead the city, disband the government, and create conditions allowing the emergency manager to declare the city bankrupt to sell off assets allegedly to satisfy creditors.

...

In Detroit’s case, the city was leveraged to the hilt with state-backed bond money to allow it to meet payroll for its employees, and by feigning resistance by creditors, unions, and pension boards to take pennies on the dollar for their assets to assist in restructuring the city’s finances, the bankruptcy gives the emergency manager power to liquidate city assets, including public employee pensions, to satisfy demands for payment. Willard Romney would be proud of emergency city manager Kevyn Orr’s adherence to the Bain tactics; especially because as city employees and residents suffer like hundreds-of-thousands of employees Bain companies ruined, corporations will buy government assets for a pittance.

Everything emergency city manager Orr has done is in line with Bain tactics including misrepresenting the city’s financial situation to create the necessity for cutting expenses, services, and finally declaring bankruptcy not unlike Bain Capital did to companies they took over. An attorney for Detroit, Krystal Crittendon, criticized a recent financial report filed by Orr and said the numbers do not accurately represent the city’s fiscal woes, and it follows typical Republican rhetoric regarding the federal debt. She said, “The whole foundation that brings him here is false. We do not have a $15 billion or a $20 billion debt problem. We have less than a $2 billion short-term debt problem that we could manage if we just went out and collected revenues that are owed to the city; stop giving tax abatement to people who can actually afford to pay taxes.” Republicans have resisted raising taxes, or even funding the IRS to collect taxes, from corporations and the wealthy while they complain social programs like Social Security and Medicare are driving the country into bankruptcy as a reason to cut spending and turn over operations like Medicare to privatization.

What Detroit suffered is a microcosm of the federal government leveraged with debt from Bush-Republicans’ tax cuts for the rich, bailouts to Wall Street and banks designated as “too big to fail,” a Medicare prescription plan, and two unnecessary wars that were all unfunded and put on the nation’s credit card. To make it nearly impossible for the federal government to meet its debt obligations, Republicans refused to bring in more revenue, and spent four years driving up debt with extensions on tax cuts for the rich, overfunding the already bloated defense budget, and nearly causing the government to default on its debts during the 2011 debt ceiling crisis. Along the way, Republicans have attempted cutting Medicare and Social Security spending they claim is driving the debt and deficit, as well as using the sequester to starve domestic programs into oblivion not unlike Detroit’s city manager withholding funding for education, city maintenance, and social programs as prohibitively expensive while giving tax breaks to the rich.

[leftyohiolib]

1. this alone should be all the motivation needed to gotv

[Octafish]

2. More than that.

Michigan Gov. Rick Snyder, the Koch Repuglian, reached across the aisle to tap Michigan's Treasury Secretary, Andy Dillon.

Once the Democratic majority leader in the State House, Dillon had been expected to be Snyder's opponent in 2010. He lost the primary to Lansing Mayor Virg Bernero, who lost to Snyder in the general election. Going from memory: Rather than campaign for Bernero, he sat quietly on the sidelines.

Dillon stepped down from his Treasury gig earlier this year, but his four years demonstrate clearly how some Democrats are willing to work with the opposition to the detriment of the people of Michigan.

[TrogL]

5. HOW? They own the media.

[Octafish]

3. Banksters walk free and We the People pay the tab for their crimes.

Thank you, Scuba. Outstanding article.

From the OP:

Michigan Governor Snyder telegraphed his intent when he appointed Orr, a “turnaround specialist,” saying, “Creditors and public servants deserve to know what promises the city can and will keep, and the only way to do those things is to radically restructure the city and allow it to reinvent itself without the burden of impossible obligations.” The victims of Snyder and Orr’s machinations are schools, city workers, and their pension plans that were given the option of taking 10-cents on the dollar or lose everything in Chapter 9 bankruptcy reorganization, and like Bain companies, employees will lose their jobs, pensions, and schools are sold off to for-profit corporations.

Background from one of the few news organizations really covering the Detroit bankruptcy:

A who’s who of the conspirators behind the Detroit bankruptcy

By Thomas Gaist
13 November 2013

EXCERPT...

Michigan State Treasurer Andy Dillon

Andrew or “Andy” Dillon is a leading Democratic politician in the state of Michigan, who was speaker of the Michigan House of Representatives before being appointed state treasurer by Snyder. Dillon was elected to the House in 2004, and ran for the Democratic nomination for governor unsuccessfully in 2010, at which point he hitched his chariot to Snyder’s campaign. He was rewarded with the second most powerful post in the state.

Dillon earned his fortune as a venture capitalist, serving as vice president of commercial finance for General Electric Capital Corporation. He become president of Detroit Steel Company in 1996, and later was managing director of the Chicago-based private equity firm Wynnchurch Capital.

Dillon has been a chief conspirator in the plans for the “restructuring” of Detroit. He worked with Jones Day attorneys to draft the April 2012 consent agreement, which forced major concessions on municipal workers, and has overseen restructuring operations against municipalities and school districts throughout the state using powers of the authoritarian emergency manager law.

An email sent by Dillon on July 10, 2013 to Orr on the wording he should use to justify the bankruptcy filing exposed the conspiratorial character of the operation. Dillon told Orr he didn’t think, “we are making the case why we are giving up so soon to reach an out of court settlement. Looks premeditated.” He advised Orr to “say facts got worse as we dug into the numbers… We don’t even say they rejected the city’s proposal. I think we may want a take it or leave it demand before we pull this trigger. I agree with the recommendation but I don’t think we made the case. After the letter is revised, let’s work on the Gov’s response.”

Dillon resigned his post as state treasurer on November 1—the day after giving a deposition for the bankruptcy trial—saying publicity over his acrimonious divorce was becoming a distraction. Snyder, stating regret, immediately heaped praise on the state Democrat.

“He has been instrumental in many of the comprehensive reforms that are contributing to Michigan’s comeback. He has worked tirelessly on behalf of the people of Michigan, and we’re a stronger state because of his dedication, expertise and leadership.” Dillon’s “partnership with Detroit to assist in the city’s turnaround,” Snyder wrote, “is just one example of Andy’s positive impact on Michigan.”

SOURCE: https://www.wsws.org/en/articles/2013/11/13/whow-n13.html

Huh. Andy Dillon's a Democrat?

[butterfly77]

4. K&R..