Chicago and Detroit: Trading places?
As Chicago slides toward insolvency, the Motor City is trending upward.
Federal judge approves Detroit pension cuts
A federal judge approved Detroit’s historic Chapter 9 bankruptcy, allowing the city to shave off $7 billion in liabilities from a total debt of $18 billion.
Detroit’s city pensioners vote to cut their own pensions
It’s ironic that Detroit government workers and pensioners, on the one-year anniversary of the Motor City’s bankruptcy, have voted to cut their own pensions. Their vote is part of a “grand bargain” bankruptcy restructuring that seeks private, philanthropic and state funds to help avoid massive cuts in government pensions. The bargain reduces Detroit’s debt by...
What the Detroit bankruptcy ruling means for Illinois
Today U.S. Bankruptcy Court Judge Steven Rhodes ruled that “nothing distinguishes pension debt from any other debt” – and that Detroit’s pension debt can therefore be partially discharged in bankruptcy. What does that mean for Illinois, where huge unfunded pension liabilities threaten to render the state government and many local governments insolvent? If the courts...
Detroit pensioners learn nothing is guaranteed
For 33 years, Clyde Tome served the city of Detroit as a firefighter. Every day he was on duty he knew his life was on the line; in one encounter with riot fires, Tome watched a colleague die. Another time, he saw a nearby fireman killed in a random shooting. For his commitment, Tome counted...
Detroit ruling reveals pensions not protected in bankruptcy
As lawmakers in Springfield prepare to vote on a controversial pension reform plan, a federal bankruptcy court judge in Detroit issued a ruling that could have major consequences for government employees throughout the country. Dealing with numerous objections to the nation’s largest municipal bankruptcy, Judge Steven Rhodes ruled that pension debts were not given “extraordinary...
An unfair approach to pension reform
For 33 years, Clyde Tome served the city of Detroit as a firefighter. Every day he was on duty he knew his life was on the line; in one encounter with riot fires, Tome watched a colleague die. Another time, he saw a nearby fireman killed in a random shooting. For his commitment, Tome counted...
Fitch Ratings: Chicago approaching “inflection point”
Triple-notch credit downgrades for government entities are supposed to be rare. They normally happen only in response to major financial events, such as a sudden fiscal emergency. But Chicago just received its second triple-notch downgrade in just six months. And that spells trouble for Chicago taxpayers. Citing skyrocketing pension costs and a lack of meaningful...
Detroit: A story that must be told
Two weeks ago I took in the demise of Detroit with my own eyes. I was fortunate to be with my colleague, Detroit native Paul Kersey. As we embarked on the trip, he told me “Detroit is a story that must be told.” He was right. I’d seen the pictures and knew the history, but...
Devil’s Night
I grew up in Detroit, and as far back as I can remember my hometown was in trouble. But if there was a time when people just gave up on the place, it was probably October 30, 1984 — just a couple weeks after the Tigers won the World Series — when fires on “Devil’s...
