A federal bankruptcy judge yesterday ruled that the city of Detroit is eligible for bankruptcy protection and may cut pension benefits for retired city workers, despite a provision in the state’s Constitution banning such pension cuts. Attorneys for city workers, firefighters and police officers say they will appeal the judge’s ruling.
Kevyn Orr, Detroit’s so-called emergency manager appointed by Gov. Rick Snyder (R) to take the city into bankruptcy over its $18 billion in long-term debt, is claiming the financial problems were caused by pension and health care benefits and wasted no time following the judge’s ruling today outlining his plans to cut retirees’ pensions. He told the Detroit Free Press editorial board those cuts will be central in his reorganization plan and that he will not ask for state help to avoid pension cuts.
In a statement this afternoon, the Michigan State AFL-CIO and Metropolitan Detroit AFL-CIO said:
Working people across Michigan are appalled by today’s ruling in the Detroit bankruptcy case. Taking from retirees who already make do with very little will not fix the city and sets a dangerous precedent for our entire state. (more…)