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Ruling Makes Detroit Biggest City to Qualify for Bankruptcy
New York Times ^ | December 3, 2013 | By Bill Vlasic and Monica Davey

Posted on 12/03/2013 3:41:13 PM PST by Brad from Tennessee

DETROIT — Detroit is eligible to shed billions in debt in the largest public bankruptcy ever in the United States, a federal judge ruled Tuesday, while also finding that the public pensions could be reduced during reorganization despite a provision in Michigan’s Constitution.

In ruling that Detroit was eligible to reorganize under federal bankruptcy law, Judge Steven W. Rhodes said the city met every test of insolvency, including failing to pay its debts and being unable to provide a minimum level of basic services to its 680,000 residents.

“This once proud and prosperous city can’t pay its debts,” the judge said. “It’s insolvent. It’s eligible for bankruptcy. But it also has an opportunity for a fresh start.”

Appeals were expected to be filed quickly. Bruce Babiarz, a spokesman for Detroit’s fire and police retirement system, which supports 8,500 retirees, said lawyers were reviewing the ruling and expected to file an appeal by the end of the week. But the case will continue to move forward, with the next step being the city filing a “plan of adjustment.” It is unclear, however, what portions of the judge’s ruling may be appealed.

Under the ruling, the vastly diminished city, once the nation’s fourth largest and the cradle of the American auto industry, will be allowed to search for a way to pay off some portion of its debts and to restore essential services to tolerable levels under court supervision. The goal, according to Kevyn Orr, an emergency manager appointed by the state of Michigan, is to emerge from court protection next year with a formal plan for starting over. . .

(Excerpt) Read more at nytimes.com ...


TOPICS: Business/Economy; Extended News; Government; US: Michigan
KEYWORDS: detroit; mattymoroun; michigan; moroun; pesnsion; retirement; system; unions
The only hope to resurrect Detroit will have to come from private investors with carte blanc powers.
1 posted on 12/03/2013 3:41:13 PM PST by Brad from Tennessee
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To: Brad from Tennessee

Good news the Union Goons lose!


2 posted on 12/03/2013 3:44:41 PM PST by Red_Devil 232 (VietVet - USMC All Ready On The Right? All Ready On The Left? All Ready On The Firing Line!)
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To: Brad from Tennessee

Ford should just buy the place for pennies on the dollar, and kick everyone out.


3 posted on 12/03/2013 3:44:59 PM PST by ROCKLOBSTER (Celebrate "Republicans Freed the Slaves" Month.)
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To: Brad from Tennessee

And forbidding black democrats from ever holding any public office in the city for the next 75 years. They have proven themselves incapable of self governance.


4 posted on 12/03/2013 3:45:56 PM PST by Lurker (Violence is rarely the answer. But when it is it is the only answer.)
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To: Brad from Tennessee

Sell it all to Matty Moroun.
He already owns most of it anyway.


5 posted on 12/03/2013 3:46:26 PM PST by Kriggerel ("All great truths are hard and bitter, but lies... are sweeter than wild honey" (Ragnar Redbeard))
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To: Brad from Tennessee

Let’s turn the city over to the cockroaches, they’ll do a better job running it than any human has for the past 50 years.


6 posted on 12/03/2013 3:47:26 PM PST by Impy (RED=COMMUNIST, NOT REPUBLICAN)
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To: Brad from Tennessee

This is good news for Michigan, although I am usually against bankruptcy. In this case, however, the unions have a stranglehold on the city of Detroit and they are in conflict with its non-state and city employed residents.


7 posted on 12/03/2013 3:48:52 PM PST by trisham (Zen is not easy. It takes effort to attain nothingness. And then what do you have? Bupkis.)
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To: Brad from Tennessee

“... to provide the quality of city services the people of Detroit deserve.”

LOL I’d think that was the LAST thing they’d want!


8 posted on 12/03/2013 3:49:07 PM PST by NonValueAdded (It's not the penalty, it's the lack of coverage on 1 Jan. Think about it.)
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To: Brad from Tennessee

Conservatism and free marketeering can save Detroit and America. Michelle Malkin was saying earlier today that the message of conservatism needs to be taken to Detroit.

As far as being the biggest city to go bankrupt, I doubt that record will stand for long.


9 posted on 12/03/2013 3:53:37 PM PST by cripplecreek (REMEMBER THE RIVER RAISIN!)
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To: Brad from Tennessee
...while also finding that the public pensions could be reduced during reorganization despite a provision in Michigan’s Constitution.

IIRC, Michigan's Constitutional provision never did apply to this situation nor was it intended to. If that is the case, the New York Slimes is up to its same old liberal lying tricks.

Would be interested to read some knowledgeable comments on the state constitutional aspect.

10 posted on 12/03/2013 4:03:09 PM PST by DakotaGator (Weep for the lost Republic! And keep your powder dry!!)
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To: Kriggerel

Matty Maroun seems to have spent his entire life trying to destroy both Detroit and Windsor. People don’t realize how much of the decay in Detroit has Maroun’s name on the deed and he’s one of the wealthiest men in America. The train station is just one example.

He’s being sued in Windsor over some 300 properties he owns and has left to rot.


11 posted on 12/03/2013 4:07:08 PM PST by cripplecreek (REMEMBER THE RIVER RAISIN!)
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To: ROCKLOBSTER

Just put Detroit on Ebay.


12 posted on 12/03/2013 4:14:04 PM PST by Jack Hydrazine (Pubbies = national collectivists; Dems = international collectivists; me = independent conservative)
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To: Brad from Tennessee

“The only hope to resurrect Detroit will have to come from private investors with carte blanc powers. “

It does not matter what the courts or the city does. Detroit is doomed. The reason to have cities is that there were lots of employers. What employer will move there? Why would they move there? What would they produce? What is their incentive to move there?

Cities are no longer needed. They are a relic of the past. Liberals try to force us to move into them by making fuel costs high and limiting how much we can drive. But no matter what they do there is no reason for us to move back to the cities with their attendant problems like drugs, bad schools and high crime.


13 posted on 12/03/2013 4:15:13 PM PST by Gen.Blather
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To: Jack Hydrazine

Name your initial bidding price for Detroit.


14 posted on 12/03/2013 4:34:10 PM PST by Jack Hydrazine (Pubbies = national collectivists; Dems = international collectivists; me = independent conservative)
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To: Brad from Tennessee

seriously, take all the illegal aliens they want to give amnesty to, and make them move to Detroit in order to get amnesty. Or give it to the Canadians.

The laugh of the article was this: “They’ll lose their health insurance” ...... which I found quite ironic because they can have Obamacare.


15 posted on 12/03/2013 4:35:49 PM PST by Usagi_yo
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To: Brad from Tennessee

Ain’t gonna do a thing for them.

That joint is cooked...who’s going to be building up new businesses there?

CommieCare Navigators?


16 posted on 12/03/2013 4:42:32 PM PST by Regulator
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To: Jack Hydrazine

One Nigerian penny.
One post WWI German penny equivalent...


17 posted on 12/03/2013 4:44:25 PM PST by Darksheare (Try my coffee, first one's free..... Even robots will kill for it!)
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To: Lurker

oh, that is so racist.... I mean true....


18 posted on 12/03/2013 4:48:48 PM PST by AlmaKing
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To: Red_Devil 232

Every government sub division including public schools need to take note. Wages, pensions, and other benefits are grossly overpaid to government employees. These people should receive pay and benefits at an equivalent level to private industry workers. I find it disgusting to see regular citizens including young people just starting out who scrimp just to pay taxes and otherwise get by, while their elite government employee brethren live an elite life of job security and priviledge. We can start by shifting government employees over to Obamacare with a meaningful contribution paid by the government employees themselves. Follow that with the elimination of government unions. Follow that with privatization of most government functions.


19 posted on 12/03/2013 4:56:19 PM PST by Sam Clements
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To: cripplecreek

“As far as being the biggest city to go bankrupt, I doubt that record will stand for long.”

Yeah, can you say Los Angeles!


20 posted on 12/03/2013 4:59:04 PM PST by vette6387
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To: vette6387

Seems to me that this is REALLY big news. I think this will be the first domino to fall, and now there’ll be a whole lot of cities, counties, and States to follow. I would be running to hide in the hills if I lived in Detroit. It is going to get real bad, real soon.


21 posted on 12/03/2013 5:32:04 PM PST by rovenstinez (,)
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To: cripplecreek

Indeed,
but Moroun STILL has a few dedicated shills and panty-huffers out there, including one or two on this site.


22 posted on 12/03/2013 5:33:42 PM PST by Kriggerel ("All great truths are hard and bitter, but lies... are sweeter than wild honey" (Ragnar Redbeard))
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To: Brad from Tennessee
If I had $20 billion dollars, I would buy the city - on the condition that I be exempt from any American laws or taxes. I would create a totally free-market paradise.

I shall call this city....Reaganville.

23 posted on 12/03/2013 5:41:44 PM PST by Extremely Extreme Extremist (Governor Sarah Heath Palin for President of the United States in 2016)
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To: rovenstinez

“I think this will be the first domino to fall, and now there’ll be a whole lot of cities, counties, and States to follow.”

Now there is “precedent,” there will be a lot more of them. Nobody really wanted to be first, now my bet is that nobody wants to be last, because the available “pot” will be shrinking quickly. What I want to see is what it ends up doing to PE unions.


24 posted on 12/03/2013 5:46:43 PM PST by vette6387
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To: vette6387

As long as Dems are in control of the fedgov, don’t expect much bad to happen to one of their primary funding sources (PE unions).


25 posted on 12/03/2013 5:48:00 PM PST by nascarnation (Wish everyone see a "Gay Kwanzaa")
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To: Kriggerel

I really think Maroun would let the Ambassador bridge fall into the river if he thought there was a buck to be made off it.

That brings me to the point of why thinking conservatives are looking for ways of fixing Detroit instead of the usual reactionary lip flapping. Its the second busiest freight crossing on the continent and its probably going to take the top slot when the new bridge is built. Only a moron would sit back and let the democrats remain in control of it.

If you put good free market conservatism back in control of the city and it will boom. The big players are moving into Detroit but they aren’t a stable economic base the way small business is.


26 posted on 12/03/2013 5:58:02 PM PST by cripplecreek (REMEMBER THE RIVER RAISIN!)
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To: Extremely Extreme Extremist
If I had $20 billion dollars, I would buy the city - on the condition that I be exempt from any American laws or taxes. I would create a totally free-market paradise. I shall call this city....Reaganville.

Their was a serious proposal to buy Belle Isle from the City and make it a tax free haven and make it a territory with an entry price of 300 large, and exemptions for artist etc. The drawings were incredible, I would have called it Galtland or Galtville. Every cutting edge libertarian leaning entrepreneur in the US world would have flocked their. But RINO Governor Snyder couldn't have that, nor the Canadians, to much focus on what they are doing wrong...

27 posted on 12/03/2013 6:03:03 PM PST by taildragger (The E-GOP won't know what hit them, The Party of Reagan is almost here, hang tight folks....)
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To: Gen.Blather
But no matter what they do there is no reason for us to move back to the cities with their attendant problems like drugs, bad schools and high crime.

There must be something good there. What about museums, the zoo and other attractions? Oh, they used to be free but now have expensive entry fees with little value. Lots of restaurants? Oh, expensive menus, restrictions on take-out packaging with high fees. Then there's the lack of parking, which has extremely expensive parking meters and overzealous enforcement with expensive traffic tickets, neighborhood parking permits gone wild with street-cleaning forcing one to constantly move your car. Restrictions on building permits, rent-controls unfavorable to owners. And high property taxes and utility fees to cover things you do not support (like transgender operations etc.). There must be some good reason to move back to the city...

28 posted on 12/03/2013 6:45:38 PM PST by roadcat
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To: Impy

http://www.youtube.com/watch?v=YSp2KGMQEk8


29 posted on 12/03/2013 6:53:25 PM PST by PhiloBedo (You gotta roll with the punches and get with what's real.)
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To: PhiloBedo
There must be something good there.

Yeah, the Detroit Tigers, although the way they got rid of Doug Fister makes me wonder if that was part of the bankruptcy settlement. Congratulations Washington Nationals...you got a great pitcher for almost nothing...

30 posted on 12/03/2013 7:01:17 PM PST by be-baw (still seeking)
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To: Extremely Extreme Extremist

In my planned opening offer, they were going to have to pay me about that amount to take it.


31 posted on 12/03/2013 8:41:47 PM PST by Gil4 (Progressives - Trying to repeal the Law of Supply and Demand since 1848)
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To: Brad from Tennessee

Detroit’s bankruptcy ruling clears the deck for Chicago’s. Chicago is in the same boat as Detroit, except not as far along. There are a lot of folks in this state that want to see these greedy public employee unions get theirs after the repeated financial rape of the taxpayers.


32 posted on 12/03/2013 9:30:56 PM PST by MasterGunner01
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To: Jack Hydrazine

Done.

http://freerepublic.com/focus/f-news/3097986/posts


33 posted on 12/03/2013 10:18:47 PM PST by doug from upland (Obama and the leftists - destroying our country one day at a time)
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To: doug from upland

LOL!!!!


34 posted on 12/04/2013 5:28:29 AM PST by Jack Hydrazine (Pubbies = national collectivists; Dems = international collectivists; me = independent conservative)
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To: Red_Devil 232
The banks are happy. So we've been waiting to see how the new "Bail-In" plan will roll out in the USA ever since we saw it happen in Cypress, CA. Now we've got our answer! Judge: Detroit Pensions Can Be Cut in Bankruptcy http://blogs.marketwatch.com/encore/2013/12/03/detroit-pensions-can-be-cut-i n-bankruptcy/ "U.S. Bankruptcy Judge Steven Rhodes ruled today that Detroit is eligible to file for Chapter 9 bankruptcy protection. That ruling clears the way for the city, the largest ever to declare bankruptcy, to restructure its $18 billion in debt. And, in a move that's sure to be closely watched by other struggling municipal governments, Rhodes ruled that the city's public-sector pensions could be reduced as part of that restructuring. Rhodes said in a summary of his ruling that Michigan's state constitutional protections for pensions "do not apply to the federal bankruptcy court." END So what's the big deal? This: In the "Bankruptcy Reform Act of 2005" the banksters got the US Congress to pass a law classifying repos and derivatives as secured assets with "super-priority" in bankruptcy. Pensions are classified as unsecured assets so the pensioners are paid AFTER the banksters. Basically, the current assets in the Pension Accounts will be used to payoff the Banksters derivative cons. That my friends...is the new Bail-In! Will the People of Detroit take this lying down? I doubt it. They will not accept losing everything they worked for their whole lives to these thieving robber barons. They will take to the streets with "modern day torches & pitchforks"...as we all should. Lock your doors Banksters..
35 posted on 12/04/2013 1:06:58 PM PST by edcoil (System now set up not to allow some to win but for no one to lose!)
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