Detroit debacle

The city’s filing of Chapter 9 for bankruptcy is now in a serious lawsuit, and this is going to be the world’s most contested legal battle encompassing the state, corporate organisations and civil society members. The jigsaw is perplexing and untenable. The question is more important because it involves money of pensioners and creditors to the tune of $18 billion.

The cradle of automobile industry in the United States that was once the pride of Michigan and reflected the industrial might of the country is now in tatters. What prompted the city to opt for Chapter-9 after years of broken promises from the state and its clients is anybody’s guess, but the fact is that it has left the poor in troubled waters with billions in debt by bondholders, retired cops and municipality workers.

As rightly stated by stakeholders, the filing of bankruptcy has shattered the presumptions that local governments would try to do whatever it took to keep it afloat. Perhaps that is why as a last legal resort the court in Michigan has ordered the City of Detroit to withdraw its application of bankruptcy and come up with a charter to ease the crisis. Though the multi-layer legal proceedings will take time to reach a decision, it will be a snowball reaction of crises not only in the monetary sense but also in political essence. Something extraordinary and something innovative in the realms of legal, economic and administration is in need of being done to revive Detroit and get it on the road again.