For a Preview of Obama's US, Watch Detroit
To make ends meet, Mr. Bing is planning to issue "tax anticipation" notes to lenders to raise $94 million against expected tax revenues. This money, along with the biannual property taxes that the city collected in August, might keep Detroit running through the end of the fiscal year next June.Mayor Bing is independently wealthy, and is paying his salary to the Detroit police department. He apparently means well. But he cannot stand up to the partnership between unions, public employees, and organised crime that controls the city now.
But that won't address the underlying fiscal imbalances. For that problem, Mr. Bing wants to squeeze $5 million in savings every month by asking the city's roughly 13,000 workers to take a 10% pay cut, a 10% benefit cut, and a 10% staff cut. He also wants to privatize or outsource many city services and consolidate various departments. "Our people [city workers] need to understand that entitlement is gone," Mr. Bing told the Detroit News in August. "There are people who think we are job providers. We're service providers."
Mr. Bing is going to have a very hard time making the city's entrenched unions play ball. John Reihl, president of the American Federation of State, Council and Municipal Employees (AFSCME) Local 207, regards Mr. Bing's talk of cuts as a personal insult. "It is just a way to mess with the unions," he told the Detroit News in July. "It's not our role to give anymore concessions."
So far Mr. Bing has shown little indication that he'll stand up to the unions. For the third time on Friday, Mr. Bing backed off on his threat to lay off more workers if unions don't accept a wage cut. Yet a recent study by the Mackinac Center for Public Policy found that if state and local government employee benefit packages in Michigan were limited to what is typical for Midwestern private sector workers—including those in unions—taxpayers would save as much as $5.7 billion annually.
The fiscal mess puts Mr. Bing in a Catch-22. He can't cut the city's taxes because the short-term hit to cash flow would leave the city unable to pay its bills. But without tax reform the city can't lure businesses back. _WSJ
US President Obama is putting himself in a similar position as Mayor Bing finds himself. Mr. Obama is enthralled to labour unions already, and is setting the stage for the unions to establish deeper and broader roots throughout all sectors of the US economy. Behind the unions, you can almost always find organised crime outfits -- such as the one that helps control Obama's Chicago.
Once that monstrous coalition gains control, voters (and even politicians) have little to say in the matter. Look at California, for an example of the same phenomenon at the state level. Michigan, Illinois, New Jersey, and New York are little better.
If a person wanted the US to become a nation-sized Detroit, he could not have chosen a better president than Mr. Obama. His connections to the coalition of organised crime and labour unions go back 20 years or more.
But it is more likely that voters chose Mr. Obama for either iconic or ideological reasons. Too bad they didn't look behind the curtains, to see where the real power behind the icon lies.