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Tuesday, June 18, 2013


Detroit said it will stop making payment on $2.5 billion of the city’s massive $18.5 billion debt and has asked creditors to accept 10 cents in the dollar of what the city owes them in a bid to avoid the largest municipal bankruptcy filing in US history.

Detroit Emergency Manager Kevyn Orr said the city would stop making payments on its unsecured debt in a bid to “conserve cash” for vital services like police and firefighters. He further said pension benefits both present and future along with healthcare would face cuts, while control over the city’s water and sewage would be turned over to an independent body.

“We’re tapped out,” Orr was quoted by WWJ-TV as saying. “We need to come up with a plan to restructure our debt obligations and our legacy obligations going forward — that is: pension, other employee benefits, healthcare, so on and so forth.”

Orr continued that $1.25 billion would be set aside over the next decade, $750 million of which will go towards public safety, including funds for police, fire, streetlights and other endeavors. The remaining $500 million will be for blight removal.

The emergency manager spent two hours with about 180 bond insurers, pension trustees, union representatives and other creditors holding Detroit debt on Friday in an effort to fix fiscal problems which have left the city insolvent.

One bond holder present at the meeting who asked not to be identified told Reuters Orr’s proposal was likely more than debt holders would be able to accept.

“It’s just too much. It is an unprecedented amount to ask.”



Anonymous said...

Democrats will be elected again which will keep Detroit like a 3rd world country.

Anonymous said...

welcome to progressive utopia coming to a city near you

lmclain said...

Detroit is not the only city thinking about cutting pensions and benefits. Politicians spend spend spend. Give everything they can to everyone they know and to hell with fiscal restraint. THEN tell us "there's no money left (like this was a surprise!) and the pensions we promised? Well, you heard the story about the cowboy and the rattlesnake, right? Right. Now, sit down and shut up. Or else." Politicians do what they do best --- lie cheat and steal. ALL of them. Even the ones with plaques and awards and effusive praise for their "committment". Think it won't happen to YOU? Keep cheering. Think your IRA's are safe? LOL. Stocks and bonds are secure? 401(k) okay? Think politicians have stopped talking about confiscating your "extra" retirement income and assets (because even though you sacrificed while others lived the party life, YOU don't need all that money -- they could do SO much with it!!)? The music must stop sooner or later and there are only about 10 chairs for 200 million people. Think you're fast enough to get one of them ??

Anonymous said...

HA HA HA Democrats suck.

Anonymous said...

They should just rename it to Nuclear Test Site, Michigan