Connecting the Dots: Water, Emergency Management, Bankruptcy and Beyond

Connecting the Dots: Water Shutoffs, Emergency Management, Bankruptcy & BeyondPeter J. HammerProfessor of LawWayne State University Law School1Connecting the Dots . . . .

2Connecting the Dots in Detroit3Structural Racism + Fiscal Austerity = Detroit

Structural Racism = 80 year history

Fiscal Austerity = 40 year historyDiagnosing Detroits Problems4Cities are living organismsRacism is pathologicalFiscal Austerity has stressed all citiesBUT: racism in the Detroit Metropolitan Area has prevented healthy systemic responsesSituation in Detroit is an extreme maladaptation to increased stresses on cities in the past 40 yearsWhy is Detroit in worse shape?5Belief Systems & Institutions:Defining Processes of Change6Belief Systems (Worldviews):How we make sense of the worldFrameworks producing order and meaningExamples: Neoclassical Economics; American Exceptionalism; Protestant Work Ethic, White Privilege, Neoliberalism . . . . Institutions: (Power)Allocation of scarce resources (economics)Distribution of social benefits and burdensRule of the game & Players of the game

Physics of Worldviews & Power7Strong belief in markets and fear of the stateEmphasis on property rightHyper sense of individualismMarginalizes role of structure and social contextBlames/punish individuals who fail to live up to standards (false meritocracy)Myth of colorblindnessBootstraps bootstrapping bootstrapsFiscal Austerity: Belief System8Minimalist stateUnrestrained marketsPrivatization of public assetsMinimal public workers/benefitsMinimal social safety net

Fiscal Austerity: Institutions9Reagan (Thatcher)World Bank/IMFFiscal austerityFiscal austerityPrivatize/deregulatePrivatize/deregulateShrink governmentShrink governmentCut spending/taxesCut spending/taxesPlan of adjustmentStructural adjustmentConservatismNeo-liberalismDomestic & International10Structuralized Racialization (verb)11Sugrue: Origins of the Urban CrisisDeindustrialization (mobility of capital)Discrimination in Employment (mobility of labor)Discrimination in Housing (mobility of land)Thomas: Redevelopment and RaceRegional divisions along racial lines (planning)Racism as obstacle to economic developmentHammer: Schooling the Governor in the 3-RsRaceRegionalism ReconciliationRace(ism) & The History of Detroit12Michigan Roundtable-Kirwan Institute Opportunity MappingDefining OpportunityHousing EmploymentSchoolingHealthTransportationFood securityLiving environmentSpatial Racism: Segregation of Race and Wealth in Detroit13Mapping Opportunity in Detroit

14Mapping Opportunity and Race

15Legacy of Spatial Racism16How does the State respond?

17Each Dot is its own artifact:Emergency ManagementDetroit Public SchoolsDetroit Future CityBlight Task Force ReportDWSD: Water ShutoffsBankruptcy Plan of AdjustmentEach Dot contains its own embedded manifestation of . . . Belief Systems (worldviews)Institutional Matrix (power)Magnetic force field

Connecting the Dots18Policies, Institutions & Belief Systems Exert Force Fields

19Difference between debt and cash flowLeading causes for falling revenue (cash flow)Falling state revenue sharingFalling property taxes (foreclosure crisis)Increasing legacy costsFinancialization and the role of Wall StreetCOPS and SWAPS and City financesBond refinancing of DWSDPredatory lending and the private mortgage financial crisis (Aitken v. Morgan Stanley)

The Causes of the Fiscal Crisis20State imposed, anti-democratic regimeEM template maps onto neoliberal fiscal austerity agendaShrink size of governmentPrivatize public assetsCancel labor contracts and reduce workforceTake the city into bankruptcy

Emergency Manager21Structurally dysfunctional school financeCharter schoolsInter-district schools of choiceCycles of failed Emergency ManagementEMs cannot solve structural crisesFailure of competition/markets as social mechanismsFailure to protect our children

Detroit Public Schools22Distressed housing market is the template for future land use changesInvestment in City Services altered to map onto existing occupancy ratesNo future residential uses in current distressed areas

Detroit Future City23Detroit Future City (housing occupancy)

24Detroit Future City (investment in city infrastructure)

25Detroit Future City (50 year vision)

26Demolition is the top and only priority850 million dollars80,000 structures430 jobsEstablish mechanisms to transfer private land ownership to public ownershipEstablish mechanism for the reassembly and redistribution of real estateDetroit Land Bank

Blight Task Force Report27Reveals the nature of the neoliberal worldview (belief system)Consistent with privatization agendaConsistent with pattern of de-population and relocation

Water Shutoffs28Mechanism to enshrine the minimalist stateVehicle for privatization and sale of public assetsDWSD?Belle Isle?Exit financing to fund the Blight Removal Task ForceBorrow new money to tear buildings down but not invest in peopleAbsence of investment in people/opportunityBankruptcy Plan of Adjustment29Need New Belief Systems & Institutions30Sustainable Development Goals

Sustainable Communities

Sustainable Economy

Sustainable EnvironmentAlternative Approaches31Water Affordability Plan as alternative paradigmArticulate components of different belief systemEquity/justiceAbility to payProgressivityEffectiveness

Alternative Approaches32Community Benefit Agreements

Community participation

Local focus for development

New partnerships with business

Place people at the center of developmentAlternative Approaches33Community Land Trusts

New justice paradigm of land ownership

New values of stewardship

New tools for community

New ethic of communityAlternative Approaches34Need to address core beliefs and institutional structuresAppreciation of common nature of many different strugglesFramework for more effective cooperation and collective actionReminder that other futures are possibleWhy Connect the Dots?35This is our basic conclusion: Our nation is moving toward two societies, one black, one white--separate and unequal.Choice is still possible. This alternative will require a commitment to national action--compassionate, massive and sustained, backed by the resources of the most powerful and the richest nation on this earth. hard choices must be made, and, if necessary, new taxes enacted.What white Americans have never fully understood but what the Negro can never forget--is that white society is deeply implicated in the ghetto. White institutions created it, white institutions maintain it, and white society condones it.Kerner Commission Report (1968)36