Labor leaders took their turn visiting the White on Friday to talk about what can and should be done for bankrupt Detroit, while also cautioning the Obama administration that the financial problems experienced in southeast Michigan may soon be felt in many other metropolitan areas across the U.S.
Calling for a plan that would not only address Detroit’s concerns but also serve as a playbook for future crises, the group — which included the UAW’s Bob King and others — left the hour-long meeting touting few specifics, but saying the groundwork was laid for a response that could help address Detroit’s issues by attracting new jobs and development.
“They are very much aware of the problem,” Lee Saunders, president of the American Federation of State, County and Municipal Employees, said after the meeting. “This is not only a Detroit problem. … This is an issue that confronts urban centers across the country.”
The meeting was one in a series that administration officials have been engaged in as they attempt to give voice to the various groups impacted by the largest municipal bankruptcy in U.S. history. While a federal bailout has been ruled out, the Obama administration has still been trying to coordinate a response to the crisis.
Agency and department heads have been asked to scour their grant programs for those which could help the city, while administration officials try to coordinate efforts between local politicians, business leaders, charitable organizations, labor and more to help stimulate economic and job creation in hard-hit Detroit.
How much of an effect it will have remains to be seen, but if the sheer number of meetings and the people attending is any indication, Detroit’s bankruptcy is being taken as a serious matter.
Washington has become a beehive of activity regarding potential responses to the Detroit crisis: Two weeks ago, officials held a meeting with leaders of business and charitable organizations; on Wednesday, a group of Baptist pastors from the city met with U.S. Rep. Marcia Fudge, D-Ohio, chairwoman of the Congressional Black Caucus, and Rep. John Conyers, a Detroit Democrat, seeking support for the city.
Also on Friday, U.S. Rep. Gary Peters, a Bloomfield Township Democrat, sent a letter to President Barack Obama calling on him to appoint an interagency task force for Detroit that would not only help maximize and target federal and private in the city, but ensure that the money is well spent with means of measuring returns.
“(No) one in Detroit is asking for a bailout, and a bailout is not what Detroit needs to prosper and grow,” wrote Peters. “As the city competes against those across the country for federal investments, we have a vested interest in ensuring that every dollar is invested efficiently.”
Representing Obama at Friday’s meeting was National Economic Council head Gene Sperling, a Michigan native who, it was announced Friday, will leave the administration at year’s end after four years. Labor Secretary Thomas Perez and Shaun Donovan, secretary of Housing and Urban Development, also were on hand.
Besides King and Saunders, the labor group included Mary Kay Henry, the president of the Service Employees International Union; Randi Weingarten, president of the American Federation of Teachers, and Harold Schaitberger, general president of the International Association of Fire Fighters.
Labor leaders have sharply criticized the process by which Michigan Gov. Rick Snyder and emergency manager Kevyn Orr filed for Detroit’s bankruptcy, and the prospect of city pensioners seeing deep reductions in benefits. But the White House has made clear it won’t get between the city and its creditors.
Schaitberger raised concerns that public services, as well as active and retired employees, should be protected. But the administration showed no indication it would get involved on the question of employee benefits.
“There was no ask, nor commitment on intervening in the proceedings” during Friday’s meeting, Henry said.
King said that the idea is to bring together groups in much the same way as was done in the response to the auto crisis in 2008 and 2009. But while General Motors and Chrysler were led by the government through structured bankruptcies, it could have only been possible with the $80 billion the Treasury pumped into the companies.
Heading into Friday’s meeting, King said that labor officials were there to talk urban policy and “ensure that Detroit doesn’t go belly up.” Key to his message — as it was to the others — is that it is not only Detroit that faces fiscal problems: Dozens of other cities, too, are on shaky financial footing.
King left the meeting, along with Saunders, expecting to contact business and local leaders about coordinating plans. Future meetings are expected.
Henry said the White House is looking at grants “across housing, transportation, labor and health and seeing how the investments reinforce each other in a way that expands private investment,” rather than being used without relation to one another.
For instance, she said, if federal cash is going to be spent on demolishing blighted structures in certain neighborhoods, the parties should determine whether it makes sense to spend on improving bus transportation through those neighborhoods, or instead use that money in areas where jobs are being or could be created.
She said it’s too early to tell whether that will result in a comprehensive plan for Detroit, or rather whether improvements would be made incrementally.
Meanwhile, at Wednesday’s meeting with Fudge, the Baptist ministers hoped to recruit “federal allies for our cause,” said the Rev. Michael Owens of Bethel Baptist Church East, who led the group. The ministers argued that Detroit is — to use a phrase from the 2008-09 national fiscal crisis — “too big to fail” and its pensioners should be protected.
“I think it was important for us to go to Washington and put a face on the problem of Detroit,” said Owens, the chairman of the local Council of Baptist Pastors.
The group asked Conyers to invite the caucus to Detroit to hold a meeting to draw attention to the city’s plight.
Source: Detroit Free Press