DETROIT (WWJ/AP) – Protesters have gathered outside of the federal courthouse in Detroit, where a judge will determine if the largest public bankruptcy in U.S. history really can go forward.
Police were forced to close streets and erect barricades as the crowd of protesters grew larger, many of whom are retirees in wheelchairs or using walkers. Most are concerned about their quality of life if they lose their pension and health care as a causality of the city’s bankruptcy.
Louis Bennett, a retired Detroit police officer, and his wife Pattie were among the crowd. For Bennett, a lot is riding on the outcome of this bankruptcy eligibility trial.
“Out of the blue, they want everything from us,” Bennett told WWJ’s Vickie Thomas. “I stand to lose. I can’t afford my medication which is, between the two of us we take 18 prescriptions a month. I cannot afford it. So, I don’t know where we’re going to end up living but we’re no doubt going to probably have to move.”
Like Bennett, who said his pension is less than $2,000 a month, retired Detroit police officer Scott Dickenson thinks the whole situation is a slap in the face.
“I’m going to tell you something. On January 14th, 1974 at 4:21 p.m. at 14021 Mayfield, some dirtbag opened fire on us as I walked up and shot my partner. They killed a sergeant, killed a police officer, shot another police officer, shot a kid in a house next door and put 21 bullet holes in the tree I’m standing behind. I earned my damn pension, every dollar,” he said.
WATCH: Raw Video of Protesters Outside Federal Courthouse
Dickenson said he’s not talking big money either, adding that his pension check is only about $1,300 a month. And after working his entire life to secure a comfortable living, Dickenson said there’s one word that can describe the way he feels.
“I’ve picked people up off the street, I’ve cuddled little kids, I’ve done all that. I earned my pension. I don’t wear a $400 suit and come here to screw people out of what they earned,” he said. “I served a year in Vietnam, I did Desert Shield and Desert Storm, a year away from my family, and after I left the police department I’ve done seven tours in Iraq and two in Afghanistan, I flew 700 combat missions. Why? Because that’s just who I am. That’s the same way I came to work here and I’m pissed.”
Bennett agreed, saying city leaders like emergency manager Kevyn Orr are sending the wrong message to the unions — that they just don’t care.
“I mean, how do you bring a bunch of people in at $200,000, the deuce and a quarter club, how do you bring these people in and they kind of act like they want to care? You know, like some of these other major corporations that it’s just work for a dollar if you’re a good guy,” he said.
The unusual trial starts Wednesday, pitting Orr and his legal team against unions and pension funds that claim the city isn’t qualified to scrub its books clean under Chapter 9 bankruptcy.
A city isn’t eligible for a bankruptcy makeover unless it shows that key steps were met, especially good-faith talks with creditors earlier this year. It’s a critical decision for Judge Steven Rhodes: If Detroit clears the hurdle, the case then would quickly turn to how to solve at least $18 billion in debt and get city government off the ropes.
Unions and pension funds are challenging Detroit on the eligibility question. They claim Orr, who acquired nearly unfettered control over city finances following his appointment by Michigan Gov. Rick Snyder, was not genuinely interested in negotiating when they met with his team in June and July. Orr insists pension funds are short $3.5 billion and health coverage also needs to be overhauled.
Evidence will show that Orr “planned to file bankruptcy long before the purported negotiations had run their course, confirming that the ‘negotiations’ were no more than a check-the-box exercise on the way to the courthouse,” Babette Ceccotti, an attorney for the United Auto Workers, said in a court filing.
Earle Erman, attorney for Detroit’s public safety unions, said the city has cut wages and changed health care benefits without across-the-table talks. Lawyer Sharon Levine, who’s representing the American Federation of State, County and Municipal Employees, said the city spent months “mapping out its path to Chapter 9,” not looking for compromises that could keep Detroit out of bankruptcy.
In response, however, attorneys for the city said a June 14 meeting and subsequent sessions with creditors were well-intended but fruitless. A bankruptcy filing was being prepared, they acknowledged, but “never set in stone.”
The trial in front of Rhodes is expected to last several days, with testimony from Orr, Police Chief James Craig, financial consultants and, possibly, the governor. It will be an autopsy on what Snyder has called decades of ruinous financial decisions in Detroit combined with an exodus of people – the population has dropped to 700,000 from 1.8 million – and other social and economic factors.
“The city’s restructuring must provide a foundation for the city to begin to provide basic, essential services to its residents in a reliable fashion,” Orr said in July when he took Detroit into bankruptcy. “Without this, the city’s death spiral … will continue.”
Orr’s team estimates that 65 percent of Detroit’s annual revenue would be eaten up in debt payments by 2017 without an overhaul in bankruptcy court.
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