Phil Power: Detroit Consent Agreement

Category: Top News Published on Monday, 09 April 2012 10:18 Written by Phil Power

Oddly, the first question the politicians asked after the Detroit
City Council finally voted to approve the consent agreement with the
State of Michigan was not “will it work,” but … “who won?”
 Short Answer No. 1: Too early to tell.
 Short Answer No. 2: Wrong question.
 Third Answer, a little longer: Sadly, in most cases, political
culture trumps common sense and any willingness to collaborate.
 One Lansing insider told me he was calling the deal between Detroit
and the state “consent agreement lite.” (Others said that an consent
agreement would be “Emergency Manager lite.“) Indeed, both Gov. Rick
Snyder and State Treasurer Andy Dillon talked about their aim to work
out “the lightest possible touch” on the city and their joint interest
in avoiding the much-dreaded emergency manager.
  Nobody doubts for a moment that this is so. But under the consent
agreement as written, there is an awful lot of diffusion of power. The
Governor, the Mayor, the City Council and the State Treasurer are all
entitled to have their hands in the pot.
 So are three powerful positions yet to be created -- the Chief
Financial Officer, the Program Manager and a nine-member Financial
Advisory Board. But while the governor may have a slightly stronger
hand than anyone else, no one person is in charge of the controls.
 ***
 Which brings us to Detroit’s political culture. To be sure, a lot of
the fierce rhetoric leading up to the agreement was political
grandstanding. But apart from that, the long record of bad blood
between Mayor Dave Bing and the Council doesn’t encourage optimism
that reaching agreement on anything will be easy.
 When you add the racial politics that have pervaded the relationships
between Detroit, the suburbs and the state for decades, you have to
worry this whole thing could come apart at the seams.
 That’s not being alarmist. Consider these potential flashpoints of
friction yet to be worked out as part of the Consent Agreement:
Appointments: Detroit has a week to create Chief Financial Officer and
Program Manager positions. Within 30 days, the Mayor must make
appointments from two lists of three names, each selected jointly by
the Mayor and State Treasurer.
Public Act 4: The Act allows the Governor to impose an Emergency
Manager on the city. Nobody wanted that. So for everybody, a Consent
Agreement was better than an EM. But without the threat of an EM, no
Consent Agreement. Yet in a new wrinkle, it now looks very likely that
enough signatures will be certified to put repeal of  the act on the
November ballot. The second that happens, the law is suspended till
after the vote. No hammer, no agreement?
Unions: The consent agreement calls for city employee unions to agree
by July 16 to concessions on pay, benefits, bumping rights and work
rules that go beyond those they negotiated last month with the city.
The unions are furious, to put it mildly.
Revenue projections: Detroit’s future budgets must dovetail with
independent revenue projections. Forecasting revenue is a tricky
business, and for everybody to agree on such forecasts seems unlikely.
         What is clear is that everybody – including Detroit officials
willing to be quoted – agrees that restructuring the city is going to
take a very long time. Pervasive illiteracy and poor skills mean that
only half of Detroit’s adults are even in the labor market at all --
the lowest rate of any major city in the nation. Curing those problems
won’t happen overnight, especially with the Detroit Public Schools in
such a mess.
  When you combine a combative political culture, racial  politics and
terrible economic problems, you get a highly combustible mix. Frankly,
I fear the most optimistic prospect is for years of quarrelling. Any
progress will be herky-jerky at best.
 Critics and protesters against the Consent Agreement decried the loss
of “democracy.” Fair enough. But, as anybody who looks at the hostile
gridlock in Washington can see, democracy alone all too often isn’t a
good way to get things done.
 So, back to the questions at the top of this column:
 1) Nobody won, which is probably the best outcome possible.
 2) Asking who won is the wrong question; the right one is how  a
structure with very diffuse decision-making can be made to work.
 3) And finally and sadly, political culture tends to trump almost
everything, including everybody’s very good intentions.


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Editor’s Note: Former newspaper publisher and University of Michigan
Regent Phil Power is a longtime observer of Michigan politics and
economics. He is also the founder and chairman of The Center for
Michigan, a nonprofit, bipartisan centrist think-and-do tank, designed
to cure Michigan’s dysfunctional political culture. He is also on the
board of the Center’s Business Leaders for Early Education. The
opinions expressed here are Power’s own and do not represent the
official views of The Center. He welcomes your comments at
ppower@thecenterformichigan.net