Michigan’s Fight for Legal Dictators Continues

by Michael Auslin

Almost a year ago, I wrote on NRO about Detroit and the rise of the new American dictators. In looking at Michigan, my point was to show how liberty can be sacrificed thanks to the failures and incompetence of elected officials, and the seemingly reasonable decision to save municipalities by appointing emergency managers. Whether they feared the loss of their freedom, or couldn’t face up to the harsh medicine doled out by putting their cities under effective receivership, nearly 53 percent of Michigan’s voters rejected Public Act 4 in a referendum on November 6, thereby seemingly ending the rule of the emergency managers.

The story does not end there, however. Michigan governor Rick Snyder, a Republican who supported Public Act 4, then decided that the state’s old emergency-manager law, the less powerful Public Act 72, would come back into effect, allowing him to continue appointing emergency managers. A state appeals court upheld Snyder’s interpretation on November 16, rejecting a legal challenge to the imposition of the previous law. Snyder’s opponents are now to file a suit with the Michigan Supreme Court seeking to kill the emergency manager law forever.

As I tried to argue last January, freedom usually disappears in fits and starts, and Republican Rome saw its liberty eroded by the slow, yet steady, expansion of the powers of the Senate-appointed, one-year-term-limited dictator. Similarly, Michigan’s Public Act 4 was the third incarnation of an emergency-manager law, each one giving more power to the manager than the last. Under Public Act 4, the managers could dismiss local elected councils, break and renegotiate contracts, and essentially take over any bureaucracy in their locality. They still remained under the control of the governor, and approved by the state legislature, but their powers were clearly growing. Governor Snyder argues that not having any emergency-manager law dramatically raises the risks of municipal bankruptcies, but some observers may argue that is just what is needed to bring a shock dose of reform to Michigan’s failing local governments. 

Yet even as the larger questions of liberty and accountability play out, the state’s largest city, Detroit continues to stumble into ruin. So far, it has managed to avoid having a dictator appointed, which would be an epochal act for a major American city with a population of 700,000. Yet in exchange for escaping state control, Detroit was forced to surrender some of its sovereignty by agreeing to a Financial Advisory Board. The Detroit Free Press describes the board as ”the joint city-state panel overseeing the city’s finances under Detroit’s fiscal stability agreement with the state.” When city officials told the board in mid-November that Detroit would likely run out of money by the end of 2012, the state agreed to provide $30 million in funding, on condition of a number of financial and legal commitments. 

Now the Detroit City Council has rejected one of those conditions, the appointment of a law firm “to provide legal advice and to handle litigation related to implementing a financial stability agreement designed to overhaul city finances,” according to Reuters. This puts the City Council at odds with both Mayor Dave Bing and the state, which will not provide the first $10 million in aid originally scheduled for next week, nor the follow-on $20 million due to be paid in mid-December. With the threat of bankruptcy looming, Governor Snyder may have to decide whether finally put Detroit under dictatorship, though it will be the less powerful emergency manager of Public Act 27.

As I wrote before, once a city the size of Detroit is stripped of its local control, it’s a big step toward normalizing the idea of emergency managers at ever-larger levels. With Illinois facing financial ruin, perhaps the Rubicon will be crossed when an entire state is put under the control of an un-elected power, thanks to unimaginative, irresponsible, and un-gifted politicians abetted by unconcerned or ignorant voters. That may indeed save a city or even a state. But it would reveal a major failure of American democracy and raise fundamental questions about a governing system in which the complexities of running a locality, state, or country outstrip the abilities of its elected officials.

The Corner

The one and only.