Detroit's False Choice

 

 

Spoiler: it was never a choice between saving the city's art or its pensioners.

I write about this for Next City:

It has become commonplace for cities in crisis to see philanthropists, non-profits and other private organizations filling the void, performing the vital tasks that City Hall can no longer do itself. An especially powerful example was revealed this week in Detroit, which is currently negotiating the terms of the largest municipal bankruptcy in history.

In an unprecedented “grand bargain,” nine local and national foundations committed $330 million in a deal to save the Detroit Institute of Arts from being mined to satisfy creditors of the city, which is about $18.5 billion in debt. The money will also ease the expected pension cuts facing Detroit’s retirees. (The pension funds are underfunded by about $3.5 billion.)

This is not just an outpouring of money. The deal is a breakthrough, crafted quietly through mediation in the last two months. As part of the terms, it will shift the museum from city ownership to the control of an independent non-profit, a move intended to protect the institution from future municipal money woes.

This is radical stuff. As the New York Times points out, the plan is “a first both in the foundation world, which has not been a source of money to shore up public-sector pensions in the past, and in municipal bankruptcy cases, experts said.” It also proves the lie that Detroit’s fiscal woes meant that the city had to choose between its art or its workers. That’s a painful and false binary that obscured the rest of the city’s 100,000-plus creditors. (From the point of view of Wall Street, this facelessness was useful.)

What to make of it all?

... and then I get it the false binary of art vs. pensioners, as well as the tricky ground of shifting public functions to private hands, and why this deal is not yet the final word.

Of course, a few hours after publishing, some big news on the "grand bargain" came out. See here and here for more on this radical and fluid proposal.

Comments

[Mike Lindgren]

Well done as always, Anna. Unfortunately we live in a country where the structures of finance and power find ways to funnel the choices into such false binaries, thereby making the real choices invisible. Good for pushing back against this kind of thing.

[Anna Clark]

(sad sigh).

Also, thank you.