AFRICANGLOBE – Editor’s Note: Although this author does raise several important philosophical points, his assumptions that the austerity imposed on Detroit is aimed at financial efficiency is flawed. There is no evidence to suggest that privatization or the measures of slashing healthcare programs, pensions, jobs, home seizures and water shut-offs will improve the city’s budget sheet.
In fact just the opposite has proven to be the case in other similar instances both inside the United States and abroad. Over $100 million has been wasted on “consultants” since the assumption of power by the Gov. Snyder and his overseer Kevyn Orr. These resources could have been utilized to keep workers on the job and to support pensioners who are left with no healthcare as a result of the actions of the emergency manager.
The issue of the legitimacy of the bank debt is not addressed. This debt is based upon predatory activity by the financial institutions and corporations who are given free reign over the affairs of the city. In reality there has been no pursuit by Orr of the criminal actions of the banks and corporations.
Since the debt is not legitimate then the only conclusion that this author could reach is a call for its cancellation. Not only should the debt be cancelled but the banks and corporations should be held accountable for the destruction they have caused in the city over decades.
On Tuesday, Kevyn Orr, the emergency manager of Detroit, transferred control of the city’s water and sewage board to the elected mayor, Mike Duggan. In his statement, Orr wrote, “As the Detroit Water and Sewerage Department works to operate more efficiently and communicate more effectively with customers, it is important to ensure there are clear lines of management and accountability.” Orr’s actions are a result of sustained and heroic activism by Detroit citizens, and a concomitant international outcry. Still, any victory they may be tempted to claim remains tenuous. Clause 6 of the order reads, “The EM may modify, amend, rescind, replace, supplement, or otherwise revise this Order at any time.” So, for example, Orr remains in control of any decision about eventual privatization of the utility. Nevertheless, Orr’s provisional move of transferring authority back to an elected official is a step in the direction of recognizing the wisdom of our founding fathers.
In “Federalist No. 10,” James Madison addressed the “dangerous vice” of faction, the “common impulse of passion, or of interest, adversed to the rights of other citizens, or to the permanent and aggregate interests of the community.” Madison rejected appointing unelected experts to solve the problems raised by factions, and offered, as the best solution to the thorny difficulty of competing interests, the idea of representative government as a way of “controlling its effects.” Madison’s solution to the problem of factionalism is a government of representatives, who are accountable to the people via the mechanism of elections.
Elections, however, can be problematic, as people can make choices that are not in their own best interests. The state of Michigan has undertaken a remarkable course to deal with the inefficiencies inherent in democratic accountability by appointing “emergency” managers who are essentially free from such accountability, in the hopes that they will be able to make politically unpopular decisions for the sake of overall efficiency — and allegedly the public good.
It’s worthwhile to examine Michigan’s experiment in challenging the wisdom of our founding fathers with an eye toward addressing two questions. First, has Michigan’s experiment resulted in policy that does maximally serve the public good? And second, in what sense is Michigan’s experiment consistent with the basic principles of democracy?
On March 16, 2011, the Republican Michigan State Legislature, with the backing of the Republican governor of Michigan, Rick Snyder, passed Public Act 4. The bill provides “for the appointment of an emergency manager” who will replace democratically elected local officials in making decisions about “expenditures, investments, and the provision of services by units of local government,” including “modification or termination of contracts,” in cases of supposed financial emergency. In November 2012, the citizens of the state of Michigan voted to repeal Public Act 4. The Michigan Legislature responded to the rejection of Public Act 4 by passing Public Act 436, essentially reinstating it, and the governor signed it into law in December 2012.
In March 2013, Governor Snyder appointed Orr as emergency manager of Detroit. Orr claims that Detroit has over 18 billion dollars in long-term debt. However, extensive independent analysis by the think tank Demos has raised troubling questions about the accuracy of the claims of financial exigency; the Demos report calls the figure of $18 billion, “irrelevant to analysis of Detroit’s insolvency and bankruptcy filing, highly inflated and, in large part, simply inaccurate.” In any case, speculative assumptions about long-term debt are irrelevant to the question of bankruptcy, which is a matter not of eventual long-term debt, but of cash flow shortfall, currently pegged at $198 million. The Demos report argues that “[t]he biggest contributing factor to the increase in Detroit’s legacy expenses is a series of complex deals it entered into in 2005 and 2006” with banks. The deals made with Detroit are widely regarded as suspicious.
Orr has not vigorously challenged the legality of the contracts that have led Detroit and the utilities that serve it to transfer huge sums to the banks. He has also not attacked the state’s decision to invest $284 million dollars of taxpayer money in a new hockey arena in Detroit. Orr has chosen instead to make the citizens of Detroit bear the brunt of the financial pain. City services have been slashed. Detroit is a city that sits atop the world’s greatest reserve of fresh water, the Great Lakes. Yet Detroit is shutting off water to customers who are more than two months late on their bills and who owe $150 or more. So far, about 2 percent of Detroit’s citizens have had their water cut off; nearly half are under threat. Single mothers are heating up (expensive) store-bought water in microwaves to clean their children’s faces; the disabled are hobbling down the streets to fill buckets to flush their toilets. During this time, the debts of golf clubs and hockey arenas have largely been ignored.
Shutting off water for nonpayment is technically legal. As a matter of public administration, however, rapidly cutting off water to such a large percentage of a city is extraordinary. Writing for The Guardian, Martin Lukacs argues that Orr’s focus on privatizing the water utility, “a prized resource worth billions,” turns the shut-offs into “a way to make the balance-sheet more attractive in the lead up to its privatization.” But privatizing the water utility is a further step in removing public accountability. The discretion inherent in executive power is being exercised to maximize financial efficiency. But there is no obvious connection between financial efficiency and the public good. It is true that debt to future generations is a kind of restriction on their freedom. But so is cutting off their access to water, even though that step may be financially efficient. In general, one can expect that the most draconian possible interpretation and execution of the legal code will be carried out if the goal is to maximize profit, and the mechanism for public accountability is lifted.
The 19th-century French political philosopher Benjamin Constant worried that appeals to the common good were often not made for democratic purposes, but rather served to “supply weapons and pretexts to all kinds of tyranny.” One may suspect Michigan’s appeal to financial efficiency has a similar purpose. This brings us to the second question, that of its democratic legitimacy.
A democratic culture is one that values free individual choice in making a life plan. In the case of a community, as the Rev. Dr. Martin Luther King reminds us in “Letter From Birmingham Jail,” this means that the policies that are binding on citizens are decided by those citizens or (as in our own democracy) representatives who are accountable to citizens. Such a system requires a culture of political equality among the citizens, what some call a culture of equal respect. As Plato wrote in “The Republic”: “The utmost freedom for the majority is reached in [a democratic city] when bought slaves, both male and female, are no less free than those who bought them. And I almost forgot to mention the extent of the legal equality of men and women and of the freedom in the relations between them.”
Plato was a harsh critic of democracy, a position that derived from the fact that his chief value for a society was social efficiency. In Plato’s view, most people are not capable of employing their autonomy to make the right choices, that is, choices that maximize overall efficiency. Michigan is following Plato’s recommendation to handle the problems raised by elections. Though there are many different senses of “liberty” and “autonomy,” none mean the same thing as “efficiency.” Singapore is a state that values efficiency above all. But by no stretch of the imagination is Singapore a democratic state. A society ruled by technocrats who make decisions on behalf of the masses is, since Plato’s time, regarded as a system that is opposed to democracy, rather than one exemplifying it.
Plato’s ideal state involves rule by experts, city planners guided by the principles of justice, who rule over skilled craftsmen and mere physical laborers. The philosophers decide which pursuits are suited for which members of society, and educate them accordingly. Plato chose those with a “philosophical nature” to play this role, because he argued that only “a lover of learning and wisdom” could be “gentle toward his own and those he knows.”
Plato was aware of the need, in his ideal state, for the rulers to be selfless. There is good reason to believe that in Michigan the financial managers who are supposed to ensure “efficiency” are not like Plato’s philosophers. After all, for whom are these policies efficient? Surely not for the Detroit residents whose children cannot drink water, bathe or flush toilets in the midst of summer. Or for those who suffer from the drastic cutbacks in all city services. This is not to deny that the Detroit emergency manager’s policies are efficient for some people. For example, they are efficient for the banks that are being paid back for what look to be ethically dubious loans, as well as for those who stand to benefit from the potentially huge profits of privatizing one of the world’s great freshwater supplies at a time of increasing global water scarcity.
But let us suppose for the sake of argument that the emergency manager, like Plato’s philosopher rulers, made decisions that were efficient for all. For example, suppose the benefits of privatizing southeastern Michigan’s freshwater utility were to flow not to private investors in the company, but to the nearly four million Michigan residents it serves. It matters not. The actions of Michigan’s governor and Legislature would be no less anti-democratic. In a democracy, one cannot replace democratically elected officials in the interest of efficiency. It is not that Public Acts 4 and 436 are morally wrong. Rather, they have no place in a democracy. It is simply no surprise at all that a democratic state can be less efficient than some nondemocratic states. In a democracy, someone who would be a good doctor is allowed to be a bad lawyer. Autonomy cannot be subsumed to efficiency in a democracy.
The Nazi political theorist Carl Schmitt was a fierce critic of liberal democracy. He argued that liberal democracy was incoherent because of what he called the problem of the exception. In emergency situations, there is not enough time to act democratically. In an emergency, someone would have to declare an exception to suspend the normal democratic process and handle the emergency. Schmitt argued that whoever had the power to declare an emergency situation and override the democratic process would be tempted to overuse that power, and declare nonemergency situations to be states of exception. This person would be in effect the sovereign.
The language of the emergency manager laws is that of exception. Calling the situation an “emergency,” and the undemocratically selected financial manager an “emergency manager” is nothing other than a declaration of the anti-democratic nature of what has occurred. Detroit does not face an immediate threat from a hostile invading army. To suppose that financial exigency or advancing an agenda of privatization for corporate gain are reasons to suspend democracy is to capitulate to its worst enemies.
The chief values of democracy are freedom and equality. The willingness to subsume freedom to claims of efficiency is one sign of an undemocratic culture. Toleration of the denial of fresh water to others is another. After all, it is hard to imagine denying fresh water to those one regards as political equals. The pressure that has resulted in the decision by Detroit’s emergency manager to turn back control of the water department to the mayor, however temporary, is, one can hope, one small sign that the drought in Detroit’s democracy may be ending.
By: Jason Stanley
Mr. Stanley is a professor of philosophy at Yale University. He is the author of “Knowledge and Practical Interests,” “Know How,” “Language in Context: Selected Essays” and the forthcoming “Why Propaganda Matters.”