Detroiters bank on mayor-elect having a rescue plan

Mike Duggan’s job is complicated; how will he keep the city solvent after bankruptcy ends?

  • Detroit-Primary-Bankruptcy



  • Jack Lessenberry.
    Jack Lessenberry.

    DETROIT — By now, everyone knows that the black voters of the nation’s most troubled city decisively elected a white mayor last week. What nobody knows is what happens next.

    Possibly the most stunning thing about Mike Duggan’s victory is that he isn’t a man of great charisma. Irish he is. John F. Kennedy he is not. Nor is he a much-loved native Detroiter. A longtime Livonia resident, the short, balding, 55-year-old political fixture — and fixer — moved into the city earlier last year, clearly just to run for mayor.

    Five years ago, his candidacy would have been seen as unimaginable. But things are desperate in the Motor City, and not just because a state-appointed emergency manager is in charge and the city is in the process of applying for bankruptcy protection.

    City services are abysmal, even by Third World standards. Forty percent — or more — of the streetlights never come on.

    Police take, on average, 58 minutes to respond to homicide calls. One woman, a professor at Wayne State University, was bitten savagely this summer by a neighbor’s dog. She called the city animal control department, which sent an officer — 11 days later.


    Reni Gresham, a 65-year-old secretary who was laid off recently because of state budget cuts, may have been typical of those voting for Mr. Duggan. “We blacks have been running the city for 40 years,” she said. “Now we need someone who can get things done.”

    Indeed, getting things done is Mr. Duggan’s reputation — and probably why he got elected. Though he has never dealt with trains, he can claim that he made the buses run on time — in the suburbs, that is, where he straightened out the finances of the SMART (Suburban Mobility Authority for Regional Transportation) bus system in the early 1990s. For years, he was also deputy county executive in Wayne County, which includes the city of Detroit.

    He was the main go-to guy and fixer for his boss, the late County Executive Ed McNamara, who was one of the Michigan’s last great political bosses. After a stint as county prosecutor, Mr. Duggan took on his most famous role: taking over and turning around the finances of the notoriously troubled Detroit Medical Center.

    He quickly made it profitable, and three years ago, sold the multi-hospital complex to Vanguard Health Systems.

    Voters plainly bet that Mr. Duggan can turn their city around too. That might be a tall order.

    But the new mayor’s job is far more complicated than that. Though he and a newly elected City Council will take office New Year’s Day, they won’t be taking power. All authority still will belong to Kevyn Orr, the emergency financial manager appointed by Gov. Rick Snyder in March.

    Mr. Orr is likely to be in the job at least until next October. Until then, the city’s elected leaders have only as much power as Mr. Orr sees fit to give them.

    Benny Napoleon, who lost to the new mayor, said the idea of an emergency manager was illegitimate, and vowed not to work with one.

    But though Mr. Duggan told voters he didn’t think an emergency manager was necessary, and that he opposed the bankruptcy filing, he said he would work with Mr. Orr. Within two days after Mr. Duggan’s victory, the two men had a long meeting.

    They need each other. The emergency manager has more than enough on his plate, including crafting a Chapter 9 restructuring plan that he will try to get Steven Rhodes, the federal bankruptcy judge in the case, to accept. While the judge has not yet ruled the city eligible for bankruptcy, it is hard to imagine otherwise.

    Regardless of how all this plays out, City Council can fire the emergency manager at any time after this coming October, and return total power to the city’s elected officials, once it can muster a two-thirds majority to do so.

    Politically, it is hard to imagine them not getting rid of the emergency manager the first moment they can.

    And regardless of whether the new mayor really thought the emergency manager unnecessary, make no mistake that Mr. Duggan has to be grateful that Mr. Orr will be in charge for the next few months. The reason: Terrible decisions are going to have to be made, decisions that will mean a lot of pain for a lot of people. Some of these decisions may leave city workers with reduced pensions or no pensions at all. Other sacrifices will have to be made.

    Mr. Duggan will be happy to tell voters these tough decisions were made not by him, but by the emergency manager — who by that point should be back practicing law in the Washington area.

    But the real question is this: How will Mayor Duggan keep Detroit solvent — and on the road to economic health — after bankruptcy ends? Detroit still will be desperately poor. While shorn of debt, it will also be shorn of assets and effectively unable to borrow money.

    Detroiters placed a bet last week that their new mayor has some sort of plan up his sleeve. Within a year, they may know if they were right.

    They do, however, know that Mr. Duggan is not a man who goes into situations where he might come out looking bad or weak.

    Detroit has to hope he’s got something up his sleeve. The good news for them is that he nearly always does.

    Jack Lessenberry, a member of the journalism faculty at Wayne State University in Detroit and The Blade’s ombudsman, writes on issues and people in Michigan.

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