Connecting the Dots: Water Shutoffs, Pensions, Emergency Management, Bankruptcy & Beyond Peter J. Hammer Professor of Law, Director Damon J. Keith Center for Civil Rights Wayne State University Law School Detroit, Michigan September 30, 2015 Creating Space XII

1. Peter J. Hammer
Professor of Law, Director
Damon J. Keith Center for Civil Rights
Wayne State University Law School

3.  Structural Racism + Fiscal Austerity = Detroit
 Structural Racism = 100 year history
 Fiscal Austerity = 40 year history
 Contemporary conflation nationally
◦ News strains of racism
◦ Pronounced anti-government views

4. Belief Systems:
Neoliberal Fiscal
Austerity
Structural
Racism
Institutional
Matrix
• Laws rules, norms,
regulations
• Rules of the game
• Players of the
game

5.  Strong belief in markets and fear of the state
 Emphasis on property right
 Hyper sense of individualism
 Marginalizes role of structure and social
context
 Blames/punish individuals who fail to live up
to standards (false meritocracy)
 Myth of colorblindness
 Vilification of public good and processes

6.  Minimalist state
 Unrestrained markets
 Privatization of public assets
 Minimal public workers/benefits
◦ Minimal respect for public employees
 Minimal social safety net

7. Intent
Structural
Racism
White
Privilege
(supremacy)
Implicit
Bias

8.  Michigan Roundtable-Kirwan Institute
Opportunity Mapping
 Defining Opportunity
◦ Housing
◦ Employment
◦ Schooling
◦ Health
◦ Transportation
◦ Food security
◦ Living environment

11. Slavery
Jim Crow
Spatial
Racism

13.  Each “Dot” is its own artifact:
◦ Emergency Management
◦ Detroit Public Schools
◦ Detroit Future City
◦ Blight Task Force Report
◦ DWSD: Water Shutoffs
◦ Bankruptcy Plan of Adjustment
◦ Pensions
 Each “Dot” contains its own embedded
manifestation of . . .
◦ Belief Systems (worldviews)
◦ Institutional Matrix (power)
◦ Magnetic force field

15.  Difference between “debt” and “cash flow”
 Leading causes for falling revenue (cash flow)
◦ Falling state revenue sharing
◦ Falling property taxes (foreclosure crisis)
◦ Increasing legacy costs
 Financialization and the role of Wall Street
◦ COPS and SWAPS and City finances
◦ Bond refinancing of DWSD
◦ Predatory lending and the private mortgage
financial crisis (Aitken v. Morgan Stanley)

16.  State imposed, anti-democratic regime
 EM template maps onto neoliberal fiscal
austerity agenda
◦ Shrink size of government
◦ Privatize public assets
◦ Cancel labor contracts and reduce workforce
◦ Take the city into bankruptcy

17.  Structurally dysfunctional school finance
◦ Charter schools
◦ Inter-district schools of choice
 Cycles of failed Emergency Management
 EMs cannot solve structural crises
 Failure of competition/markets as social
mechanisms
 Failure to protect our children

18.  Distressed housing market is the template for
future land use changes
 Investment in City Services altered to map
onto existing occupancy rates
 No future residential uses in current
distressed areas

22.  Reveals the nature of the neoliberal worldview
 Consistent with pattern of de-population
 Water shutoffs
◦ 2014 – 3000/week => 30,000 households
◦ 2015 – 800/week => 24,000 households
 Assistance plans: Band-Aids not structural
remedies (Curt Guyette)
 170,493 residential accounts Detroit
 73,457 accounts more than 60 days overdue (43%)
 24,743 accounts on payment plans
 24,450 payment plans over 60 days overdue
 293 accounts helped

23.  Demolition is the top and only priority
◦ 850 million dollars
◦ 80,000 structures
◦ 430 jobs
 Establish mechanisms to transfer private land
ownership to public ownership
 Establish mechanism for the reassembly and
redistribution of real estate
◦ Detroit Land Bank

24.  Mechanism to enshrine the minimalist state
 “Exit financing” to fund the Blight Removal
Task Force
◦ Proposed to borrow new money to tear buildings
down but not invest in people (did not come to
complete fruition)
 Absence of investment in people/opportunity
 Absence of respect for public employees
 Logical extension of fiscal austerity and
structural racism

25. Belief Systems:
Equitable,
people-focused
development
Institutional
Matrix
• New Laws,
policies, rules,
norms, regulations

26. Equitable-
People-Focused
Development
Community
Benefits
Ordinance
Community
Land Trusts
Water
Affordability
Plan
Foreclosure
Relief
Respect
public
employees
Pathways to
Opportunity

27.  Questions?