War on the Poor Continues With Planned Pension Cuts in Detroit and Illinois


Yesterday Federal bankruptcy court judge Steven Rhodes ruled that Detroit is insolvent and eligible for a Chapter 9 debt restructuring. This gives the city the go-ahead to cut retirement benefits as part of its restructuring plan, despite pensions being explicitly protected by the state constitution.

Learn more about the situation in Detroit at Detroit Inquiry.

Judge Rhodes’s decision serves as a precedent for city and state governments across the country to carry out a similar policies. Just hours after the Detroit ruling, both chambers of the Illinois legislature also passed an unconstitutional pension reform bill that would steal money from the pension plans Illinois state workers paid for, reduce and suspend cost-of-living increases and limit their salaries.

Such acts of class warfare demonstrate how the government/corporate machine views the 99% as merely a source of wealth and cannon fodder. Once they find cheaper labor and more prosperous markets elsewhere and once soldiers return home after fighting their wars, we’re worth even less to them. Judging from their actions, the corporatocracy has no loyalty, trust and respect for us. Why should we give them any loyalty, trust and respect if it’s not reciprocated?

Detroit Bankruptcy Timeline:


March 16: Michigan’s Public Act 4 emergency manager law goes into effect.

Nov. 16: Detroit Mayor Dave Bing says the city could run out of cash by April 2012 and have a potential shortfall of $45 million by the end of the fiscal year June 30.

Dec. 2: State Treasurer Andy Dillon orders a preliminary financial review of Detroit. The move sparks protests against Michigan Public Act 4, the emergency manager law that expanded EM powers.

Dec. 21: Dillon announces “probable financial stress” in Detroit and recommends Snyder send a team to review city finances.


Jan. 10: Former State Treasurer Andy Dillon gives Mayor Dave Bing until the first week of February to submit a financial plan to avoid an emergency manager.

March 13: A 25-page proposed consent agreement is given to the City Council.

March 21: A state review team declares Detroit in a “severe financial emergency.”

March 23: The Michigan Court of Appeals reverses an Ingham County judge’s ruling that barred the state from entering a consent agreement with Detroit.

April 4: The City Council, 5-4, approves a consent agreement.

April 5: Gov. Rick Snyder and Bing sign the agreement.

June 15: A nine-member oversight board created under the consent agreement holds its first meeting.

Aug. 2: A proposed repeal of Public Act 4 is placed on the Nov. 6 ballot and the law immediately is suspended. Public Act 72, the prior 1990 law that grants fewer powers to emergency financial mangers, is reinstated.

Nov. 7: Public Act 4 is repealed in the general election.

Dec. 10: Detroit’s Financial Advisory Board calls for a 30-day review of the city’s finances under Public Act 72.

Dec. 14: A state review of Detroit finances finds “a serious financial problem.”

Dec. 27: Snyder signs a new emergency manager bill, Public Act 436, which is to take effect March 28.


Jan. 3: An audit shows Detroit has a $327 million accumulated deficit as of June 30.

Feb. 19: A state team reviewing Detroit’s finances determines the city is in a financial emergency with “no satisfactory” plan to resolve it.

March 1: Snyder announces plans to bring an emergency manager to Detroit.

March 9: The council makes a formal request for an appeal hearing in Lansing.

March 12: Detroit officials fail to convince the state’s Emergency Loan Board that a satisfactory plan in place to address Detroit’s fiscal crisis without an emergency manager.

March 14: Snyder appoints Kevyn Orr as Detroit emergency manager. He takes office March 25 for the job, which pays $275,000 per year. State officials hope he can complete his job within 18 months.

March 26: Public Act 436 goes into effect and opponents file a lawsuit in U.S. District Court in Detroit, arguing the legislation deprives citizens of “constitutionally protected rights” and dilutes their vote.

May 13: Orr submits a preliminary financial and operating plan to the state Treasury Department, saying Detroit’s cash-flow crisis makes it “insolvent.”

June 14: Orr unveils to creditors his plans to restructure the city’s finances and avoid bankruptcy.

June 20: Orr holds closed-door meetings with union officials to discuss a restructuring proposal that includes health care and pension cuts and launches a probe of the city’s pension funds amid concerns about corruption, spending and management.

July 5: The city files a lawsuit against Syncora Guarantee Inc., in an attempt to recover $11 million a month in casino payments and taxes that Detroit claims are being improperly withheld by the insurance company.

July 15: Orr submits a quarterly financial report to the state saying the city’s financial condition “continues to be dire.”

July 17: The city’s two pension funds sue Snyder July 17 to block him from authorizing what would be the biggest municipal bankruptcy in U.S. history on claims it would violate retirees’ constitutional right to a pension.

July 18: Orr files a petition for municipal bankruptcy in U.S. District Court’s Eastern District in Detroit.

July 19: The case is assigned to U.S. Bankruptcy Judge Steven Rhodes.

July 24: Rhodes freezes all lawsuits against the city challenging the legality of Detroit’s bankruptcy filing.

Aug. 2: Rhodes creates a committee to represent city retirees.

Aug. 5: Orr announces he has contracted with Christie’s, the New York-based international auction house, to appraise the collection of the Detroit Institute of Arts.

Aug. 13: Chief U.S. District Judge Gerald Rosen is appointed to mediate disputes between the city and creditors.

Sept. 26: An audit commissioned by Orr reveals the city’s pension funds lost more than $125 million on real estate deals and gave questionable bonus payments to employees.

Oct. 9: Gov. Rick Snyder is questioned under oath about his decision to authorize the largest municipal bankruptcy in U.S. history. Snyder is the first sitting governor in modern Michigan history to face a sworn deposition.

Oct. 11: Orr announces the city has secured a $350 million loan agreement with Barclays to pay off a pension related-debt and finance city service improvements while Detroit is in bankruptcy.

Oct. 15: In a report to Dillon, Orr says the city’s financial condition remains dire but cash flow improved during the first quarter since the bankruptcy filing.

Oct. 25: Detroit’s eligibility trial begins before Judge Rhodes in Detroit’s federal courthouse.

Nov. 6: Judge Rhodes denies the NAACP’s request to pursue a lawsuit against Gov. Rick Snyder’s administration over the constitutionality of the emergency manager law.

Nov. 8: The city’s nine-day eligibility trial ends.

Nov. 8: Orr postpones a proposed health care initiative for retirees until Feb. 28 under an agreement with the city and retiree committee created through bankruptcy proceedings.

Nov. 13: A city union representing Detroit’s EMTs reaches a five-year, out-of-court contract agreement with Orr.

Nov. 25: Rhodes in a court filing announces he will decide Dec. 3 whether Detroit can proceed with its Chapter 9 bankruptcy filing.

Nov. 26: A group of creditors ask for an independent evaluation of the Detroit Institute of Arts collection.

Nov. 27: Judge Rhodes halts Detroit’s efforts to fix its broken streetlight system after discovering one of the city’s law firms involved in the bankruptcy case also represents the new Public Lighting Authority, a potential conflict of interest.

Nov. 27: A trial over Detroit’s plan to seek a $350 million bankruptcy loan is pushed back amid new objections by creditors. Judge Rhodes and attorneys representing the city and several creditors agreed in principle to delay the trial to Dec. 17-19.

Dec. 3: Rhodes delivers decision on bankruptcy eligibility.

(Timeline: Associated Press)

This entry was posted in Activism, consciousness, Corporate Crime, Economics, Financial Crisis, Labor, Recession, Social Control, society, State Crime, Work and tagged , , , , , , , , , , , , , , , . Bookmark the permalink.

3 Responses to War on the Poor Continues With Planned Pension Cuts in Detroit and Illinois

  1. Jeff Nguyen says:

    Here’s another good source on the shameful tactics being employed against the residents of Detroit, Luther.



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