Rent Seeking

The DPS Bailout – An Alternative History Under Bankruptcy

A Bankruptcy Postponed Is Not A Bankruptcy Avoided

US Bankruptcy Court ImageThe $ 617 million PA 192 – 197 bail out package signed by Governor Snyder on 21 June (plus the $ 48.7 million emergency down payment earlier this year) will not fix the Detroit Public Schools. The culture of corruption and incompetence long fostered within DPS suggests that the new DPS – same as the old DPS, except for some liabilities – will fail miserably a few years hence in an avalanche of new liabilities. Michigan will then be left to sort out two separate DPS entities with unsustainable liabilities. This could easily occur even before Governor Snyder leaves office in 2019. Karma. Déjà vu all over again.

Governor Snyder secured the Michigan Legislature’s approval of the $ 617 million bailout by regaling them with an entirely false narrative of the aborted 1991 Richmond, CA Unified School District bankruptcy, then implying that the entire $ 3.5 billion in DPS liabilities would fall upon the taxpayers of Michigan. The Michigan Legislature’s Republicans (and our nitwit media) bought Governor Snyder’s tale hook, line, and sinker – then delivered a $ 617 million gift to DPS for its past ill behavior. The Michigan Legislature’s Democrats had the chutzpah to hold out for even more taxpayer paid goodies.

There was another, better option: bankruptcy.

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Exactly whose agenda is Gov. Snyder promoting?

"While shutting down the schools would be horrible. It is a better option than the alternative."

“This marks a new day for Detroit families, with DPS free from debt and strong accountability measures for all schools in the city that promises a brighter future for all of Detroit’s children.” – Michigan Governor Rick Snyder after signing the DPS bailout package last month.

If only that were really true.

There’s a story making the rounds here locally, that to put it mildly, I am more than a little surprised hasn’t been picked up by other media outlets around Michigan.

It seems that Emergency Manager Transition Manager Stephen Rhodes, Michigan Treasurer Nick Khouri, Gov. Snyder and a few select others within Michigan Government have felt that it is more important to bury some rather disturbing facts relating to Detroit Public Schools, rather than to make them public (Read: Better make sure that Michigan Taxpayers don’t EVER get wind of this!).

 

What was John Burroughs Intermediate School.

Nope, not the crumbling infrastructure of DPS.

And what is this little nugget you may ask?

{Continued below}

H/T to the good people at Channel 7 in Detroit for breaking this story.

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Bang head here.

What's amazing here is not what they tell you, but what they don't...

Well, the children in Detroit are at it again.

And is there any wonder why there is so much blow-back from Gov. Snyder’s latest excuse to waste Michigan Taxpayer money on Detroit?

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I can’t wait until the rest comes due!

Gov. Snyder, Sen. Meekhof and Sperker Cotter demonstrating their best use for Michigan Taxpayer dollars.

With that conveniently (and consistently) “overlooked” $3.5-billion in debt, the Mi(a)GOP just handed the Michigan House to the democrats in the fall.

Screwed Image 1

Here’s a not-so-subtle hint.

 

More to follow…

 

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Democratic Socialism Comes to Southeast Michigan

RTA Funding Could Buy All Their New Riders New Cars, And Pay For Their Fuel and Insurance To Boot!

RTA Transit Map aThe new Regional Transit Authority of Southeast Michigan is out today with their transportation master plan to soak taxpayers in Macomb, Oakland, Washtenaw, and Wayne Counties for another $ 3.3 billion in property taxes over a 20 year period.Michael Ford Smiling RTA CEO Michael Ford released the regional mass transit plan RTA will submit to voters on November 8th under PA 387 of 2012. A 1.2 mill property tax increase and $ 1.7 billion in new Federal & State subsidies will provide four new bus rapid transit lines, 11 cross county connector lines, one regional rail line, and some extended/intensified local service.

Let’s have some fun by subjecting the new RTA regional mass transit plan to some real, pre Common Core, mathematics.

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If we can convince you that smoking is good and get you to eat for breakfast what we want you to, then we can definitely get you to support this.

Take a good look at the picture below.

Edward Bernays Image

He’s going to factor heavily in this post (and more importantly, what YOU can do to protect your pocketbook).

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Because giving them even more money has always solved Detroit’s problems.

Hold onto your wallets because the fun is set to begin again tomorrow.

Last week the Michigan House, in response to the temper tantrum thrown by the Detroit Federation of Teachers (which to be fair, was in response to the gross ineptitude of one Judge Steven Rhodes), passed yet another in a long line of “life preservers” to the failed Detroit Public School district.

Despite having been “locked out” by administration (seriously, that is what the DFT was using as a speaking point on every local talking head show last weekend), things went back to normal by Wednesday.

I’m still trying to wrap my head around the concept of how calling in sick en masse is somehow the equivalent of being “locked out” from your place of employment…but I digress.

Unlike the bailout proposed by the Michigan Senate, the House package is about $200-million lighter than the Senate’s, and is choked so full of poison-pill provisions that it is guaranteed to cause even more problems.

 

Bus roll over

“Not to worry! With a little elbow grease and some friendly verbal persuasion, we’ll have you upright and humming along the road in no time,” our relentlessly positive Gov Snyder allegedly remarked about the latest DPS bailout.

{More below the fold}

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Whoopie Ti Yi Yo, Git Along Little Dogies

Cattle Roundup Image 1

Whoopee Ti Yi Yo, Git Along Little Dogies

Some boys goes up the trail for pleasure,
But that’s where you get it most awfully wrong;
For you haven’t any idea the trouble they give us
While we go driving them all along.

Whoopee Ti Yi Yo, Git Along Little Dogies

When the night comes on and we hold them on the bedground,
These little dogies that roll on so slow;
Roll up the herd and cut out the strays,
And roll the little dogies that never rolled before.

Whoopee Ti Yi Yo, Git Along Little Dogies

Traditional 19th Century American Cowboy Cattle Drive Song

Rhodes Image 1aMichigan’s tax-and-spend establishment continues to demonstrate world class tactical flexibility as they pursue their dubious ends. Their latest tour de force is the setup for the impending Detroit Public Schools bailout. Michigan’s legislators are being driven like cattle.

The new state appointed emergency transition manager of the Detroit Public Schools, retired U.S. Bankruptcy Court Judge Steven W. Rhodes, announced that the district would shut down on April 8th due to a lack of funds. This chilling announcement came a week after Governor Snyder appointed him to replace Darnell Early, who resigned at the end of February. Darnell Early, for some reason, failed to inform Michigan of the April 8th drop dead date. Judge Rhodes made his announcement four weeks in advance of the projected shutdown in a full court press to get a bailout from our State Legislature.

Detroit Public Schools LogoThe first problem here is the State Legislature is scheduled to take two weeks off in the four weeks leading up to April 8th. The last week of March and the first week of April. Judge Rhodes certainly knew this, so the dilatory announcement is unquestionably a deliberate effort to stampede the Michigan Legislature into immediately delivering $ 50 – 70 million to DPS, no questions asked. Two weeks is not a reasonable legislative time frame, rather it is herding legislators like cattle on a two week drive. An echo of the tactics used by Judge Rhodes to ram through the bungled Detroit bankruptcy.

Governor Snyder has been floating an inchoate plan to rescue the Detroit Public Schools since the middle of last year; one which originally envisioned the creation of a ‘bad debt’ shell district and a new, debt free district by cellular division. Wasn’t really well received anywhere, even after he added dissolution of the much hated Education Achievement Authority. As his problems in the Flint water fiasco have mounted, Governor Snyder decided to wash his hands of the DPS situation by throwing $ 700 million at them to extinguish their ‘operating’ debt and return control to the next generation of local thieves elected school board members.

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Emergency Managers, Emergency Management

Synonyms for Headlee Evasion

Darnell Early

Darnell Early

La victoria trova cento padri, a nessuno vuole riconoscere l’insuccesso
A victory finds 100 fathers, nobody claims credit for a failure.
Galezzo Ciano, 2o Conte di Cortellazzo e Buccari, Diary (1942)

The left wing meme on the Flint Water fiasco is that Governor Snyder seized absolute control of Flint and installed doctrinaire Republican viceroys who ruthlessly slashed Flint’s payroll and expenditures without any regard for the residents.

If only this were so.

Michael Brown

Michael Brown

The Flint emergency managers had only one common thread in their backgrounds, long records of administration in government and the nonprofit sectors. No productive experience. Experts at spending other people’s money. Well paid experts.  Outright Democrats or chameleons politically; typical politics of the bureaucratic class. Look at the backgrounds of the Flint emergency managers:

Edward Kurtz

Michael K. Brown

Edward Kurtz, again

Michael K. Brown, again

Darnell Early

Gerald (Jerry) Ambrose

Emergency managers are not viceroys with absolute powers. The evolution of emergency management in Michigan was frustrated by public union opposition. Five successive laws, one repealed by referendum. The law in force during the critical Flint water fiasco decisions is PA 436 of 2012. The powers it confers upon emergency managers are:

MCL 141.1549, Section 9

(2) Upon appointment, an emergency manager shall act for and in the place and stead of the governing body and the office of chief administrative officer of the local government. The emergency manager shall have broad powers in receivership to rectify the financial emergency and to assure the fiscal accountability of the local government and the local government’s capacity to provide or cause to be provided necessary governmental services essential to the public health, safety, and welfare. Following appointment of an emergency manager and during the pendency of receivership, the governing body and the chief administrative officer of the local government shall not exercise any of the powers of those offices except as may be specifically authorized in writing by the emergency manager or as otherwise provided by this act and are subject to any conditions required by the emergency manager.

The emergency managers replace the mayors, council, and chief administrative officers of the municipal governments. While this does indeed give them extraordinary powers of control, their control is anything but absolute. The municipal charter continues in effect and continues to protect the prerogatives of lesser bureaucrats. The vague statutory powers of emergency managers beyond replacing the mayor, council, and chief administrative officer poses unremitting legal jeopardy to emergency managers. Encourages timidity and bureaucratic subterfuge. Not absolute control.

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Bureaucratic Capture In The Flint Water Fiasco, An Echo Of Proposal 1

Snyder's Email Dump Is Most Notable for What It Doesn't Show: Management

Snyder Steudle Image 1Governor Snyder went way out on a political limb supporting Proposal 2015-01. By the time this limb broke off at the polls on May 5th, his only remaining allies were MDoT, MITA, and Michigan’s nitwit media.

MDoT’s Director, Kirk T. Steudle, P.E. received lavish, flattering coverage in our nitwit media throughout the road funding proposal campaign. The Transportation Asset Management Council, an MDoT tool, packaged an avalanche of lies in glossy pamphlets for public consumption. An entirely fictitious Washington think tank, TRIP, used inside MDoT information to issue even more incredulous lies. Governor Snyder parroted these titillating lies thoughout his Proposal 1 media campaign. He was entirely comfortable promoting the agenda of his ‘technical experts’.

Pre SB 571 campaign finance law allowed us to watch MITA spend $ 5.4 million supporting this turkey, more than half the total spent by Safe Roads Yes! The Michigan Infrastructure and Transporatation Association is ostensibly a bunch of independent, competitive contractors. Somehow a fractious bunch of competitors planned and executed a well coordinated – if entirely devious – political campaign.

How did they coordinate?

How did this presage the Flint water fiasco?

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