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Chuck Moss

Chuck Moss

Failed States

April 1, 2016

Flint. Detroit Public Schools. Both are front-burner in Lansing and dominate our attention and agendas.

On one hand, a city whose mismanagement of a fundamental service is a scandal, and the other a school system whose inability to educate generations of children is a disgrace. But Flint and DPS are also the worst examples of institutions that can’t do their basic jobs—let’s call them “failed states.”

What is a “failed state?” When I was growing up, the world was full of countries. Every piece of land had a border, a name, and a government. But in the late 20th century, this started to change. Somalia is an example. The area on the map that says “Somalia” has no government, no law and order. Libya is another. There are more. They are states that have collapsed, failed.

In Michigan, we have governmental entities that can’t do their basic jobs, let’s call them “failed states.” You can see the results. Flint has lost half its population and most of its industrial base since 1970. The Detroit Public Schools has hemorrhaged students and gone in and out of fiscal distress for a quarter century. Basic lack of solvency— long term inability to balance the budget and pay the bills—is a hallmark of our failed states. Flint and DPS aren’t the only ones.

Another hallmark of Michigan’s failed states, is their inability to do the bedrock job they were created to do. A failed city can’t police the streets, plow snow, or pick up garbage. A failed school system can’t educate kids. In fact, a common trait of a local failed state seems to be almost abandoning its real mission. One Michigan school system, which shall remain nameless, was described by a state-appointed manager as a perfect closed system. The vendors give money to the politicians, who give fat contracts to the vendors and the labor unions, who in turn elect the politicians. Everybody wins! Except, of course, the generations of mal-educated kids, whose schooling was a sub-priority.

People, including poor people, aren’t stupid. When a failed state stops providing basic services, people will stop moving in, and start moving out. That gets you the Death Spiral: less revenue, more budget pinch, lower services, and more people moving out. But the fat contracts still have to be paid, which leads to debt and unfunded benefit liability.

After ten years of Michigan’s lost decade and Governor Jennifer Granholm’s whistling-in-the-dark leadership, the budget situation of many, many Michigan “states”—cities, counties, villages, school districts—was perilous. Ten lean years had brought them to the brink. The unspoken and urgent overarching story of the Snyder Administration has been shoring up of the fragile house of cards that is public finance here in Michigan. A bad balance sheet is like high blood pressure or Stage 2 diabetes: a silent killer. It doesn’t matter how good you look or how tough you talk: you are very sick and if untreated, you will die. Highland Park Schools died. They collapsed financially and were dissolved.

So why don’t the Michigan failing states mend their ways before they collapse and die? Think back to the “perfect system.” It works great for the people who run it. It’s their dinner pail, their meal ticket, and they’re not going to let it go without a fight. Emergency financial managers are appointed when governments essentially meet conditions that would throw private companies into bankruptcy. So what’s the first response of most leaders to appointment of an emergency manager? Resistance! They fight for self-government! Democratic rights! Local power! Their failure to serve their communities are ignored or alibied away. No one talks about real reform, just “give us back the power” and often to the same failed leaders. The spiral isn’t cured and eventually reality gets the last word.

The reality of Michigan’s failed states underlies much. Maybe Lansing can replace every old pipe in Flint; then what do you do about Saginaw? DPS is collapsing, what about Pontiac? And overall is the real question: if the failed states can’t protect, serve, and educate people, then who will? Unlike Libya, we can’t declare victory and bug out. These kids and citizens deserve basic services and are Constitutionally entitled to them.

One good idea: if the failing old-line entities can’t or won’t do the job, let’s quit pretending that they magically will. Quit turning a blind eye to corruption of the basic mission. The communities that made hard choices to thrive have an understandable aversion to seeing their hard-earned and reluctantly-taxed wealth flowing to keep incorrigible fiscal.

Chuck Moss teaches Political Science at Oakland University and serves on the Board of the Regional Transportation Authority. He was elected to represent the 40th District in the Michigan House and was appointed Chairman of the all-important Appropriations Committee, responsible for the entire state budget. Prior to politics, Chuck was political columnist for the DETROIT NEWS, and has hosted talk shows for radio and television.

March 31, 2016 · Filed under Chuck Moss

2 responses so far ↓

  • 1 George W. Bird // Apr 1, 2016 at 8:45 am

    Chuck

    Excellent article.

    One possible answer to your question, “So why don’t the Michigan failing states mend their ways before they collapse and die”, is because collapse has already taken place.

    gwb

  • 2 Jean Kozek // Apr 11, 2016 at 8:27 am

    You imply that local government corruption and the inability to adjust budgets to reductions in tax revenues are the causes of “failed states” such as Flint and Detroit.

    Lets talk about Flint. It used to be a thriving middle income city until Buick closed its plant. A city that gave tax incentives to Buick to build there, no longer received any benefits. Of course a city can’t adjust to a major loss of revenue and jobs. Homes lost their value and revenue became scarce. It wasn’t local government that caused this disaster but rather capitalistic practices where profits and not public good determines CEO decisions. And remember, it wasn’t local government that made the choice to switch contracts for water delivery. It was an executive choice made by state gov’t. and the Emergency Manager it named.

    In the case of Detroit schools, please remember that governor Granholm took over Detroit schools even though the district was running a BALANCED budget. Since Emergency Managers took over in 1999, the district’s budget has steadily become debt ridden. And, obviously, the increase in spending was not because money was being spent on maintenance of the school buildings, or the acquisition of school materials, or an improvement in teacher to student ratio. Emergency Managers did not have qualifications for managing a school district and they did not even provide basic oversight of spending. Currently ten administrators (not teachers) have been accused of accepting bribes.

    Your choice of “failed state” is most appropriate. Our state government failed to do its assigned task, namely the well-being of Michigan citizens.


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