Detroit workers: “Jobs, Pensions, City Services–The Banks Owe Us!”

AFSCME District Council 25 in Michigan on August 19 filed pleadings in US Bankruptcy Court challenging the City of Detroit’s July bankruptcy filing.

If Detroit’s bankruptcy is allowed to proceed, it is possible that the city will be able to terminate its collective bargaining agreements with workers and impose new terms of employment on them. Bankruptcy will also mean that retired frontline city workers whose pension’s average between $17,000 and $19,000 a year may have their pensions reduced.

Meanwhile, Diane Bukowski, writing for the Voice of Detroit, reports that city officials have taken special steps to protect the interests of UBS, SBS Financial Services, and Bank of America, creditors who in 2005 and 2006 sold credit default swaps to the city.

Detroit Emergency Manager Kevyn Orr has said that these credit default swaps are partially responsible for the city’s financial woes that led to the bankruptcy filing.

On the day that AFSCME filed its objections, members of the union, including retired city workers picketed in front of the courthouse where the objection was filed.

Union members carried signs reading, “Jobs, Pensions, City Services: The Banks Owe Us!”

The union in its objections argues that Michigan’s emergency manager law is unconstitutional.  The law gives the governor the right to appoint an emergency manager when a municipality faces financial difficulties. The powers of the emergency manager exceed those of all elected officials.

After his appointment by Gov. Rick Snyder, Orr took control of Detroit in March and on July 18, filed for bankruptcy on behalf of the city.

The union also contends that the bankruptcy should not be allowed to proceed because the emergency manager law also does not protect retirement benefits earned by workers during their years of employment with the city.

In addition to AFSCME, about 50 residents of Detroit also filed objections to the bankruptcy proceedings.

“The City of Detroit has too many assets to be bankrupt,” wrote Detroit retiree Olivia Gillon in her objection. “Detroit is no different than hundreds of other American cities that are cash-strapped and want to get their hands on retiree pension funds. If the federal court allows our pension fund to be raided, it will open a flood gate for hundreds of other cities.”

Other creditors including Detroit worker pension funds also have filed objections.

Judge Steven Rhodes will hold hearings on the objections in October.

In September, Rhodes will hold hearings on objections to a deal between the city and UBS, Bank of America, and SBS Financial Services struck three days before Detroit’s July 18 bankruptcy filing.

The city and these three banks on July 15 signed off on a forbearance agreement, which guarantees that the banks will be paid $0.75 on the dollar for credit default swaps that they sold the city as a hedge against pension obligation certificates, bought in 2005 and 2006 to pay for its pension contributions.

The agreement between the city and the banks releases $11 million in casino tax revenue that the banks contend is collateral for the swaps.

The swaps were supposed to protect the city in case it was unable to repay the pension obligations certificates, whose interest rate was 0.6056 percent.

When the economy crashed in 2008, Detroit was hit hard and was unable to make payments on the pension obligation certificates, which caused it to buy more swaps.

Since then, Detroit has been making payments on the swaps, whose interest rate is 6.323 percent.

The union in its objections estimates that the city has already paid $800 million as a result of the swaps.

The union’s objections also point out that UBS and Bank of America have been charged and reached settlements in a number of cases involving municipal bond fraud.

Furthermore, while other creditors’ claims have been put on hold as a result of the bankruptcy filing, the city has continued to make payments to the three banks. The union estimates that if the forbearance agreement is allowed to stand, it will cost the city $200 million over the next six months.

David Sole, a retiree who also filed an objection to the bankruptcy, contends that the economic crash that hit Detroit so hard and ultimately resulted in the bankruptcy filing was caused by predatory lending practices of banks like Bank of America and UBS.

“The financial crisis that precipitated this Chapter 9 bankruptcy filing was in large part a result of the effects of predatory lending by the banks against the residents of Detroit, which resulted in tens of thousands of foreclosures in the city, a massive population decline and a precipitous decline in property values.” said the objection filed by Sole.

Advertisements

One thought on “Detroit workers: “Jobs, Pensions, City Services–The Banks Owe Us!”

  1. THE DESCENDANTS OF THE MERCHANT OF VENICE IN ACTION IN DETROIT

    FED JUDGE WILL ISSUE VERDICT DEC. 3 ON LEGALITY OF DETROIT DECLARING BANKRUPTCY; NATURAL LAW REQUIRES GLASS STEAGALL
    November 26, 2013 • 3:23PM

    Federal Bankruptcy Judge Steven Rhodes said in a court filing yesterday, that on Dec. 3, he will hold a hearing at 9 am to discuss his verdict on whether to authorize the Ch. 9 bankrupcty filing by the city of Detroit; his written statement will be made available later. Rhodes’ action is considered highly unusual, compared to standard law practice; he is expected to speak very carefully on the record, in order to avoid grounds for appeal.
    In citation of a debt of $18 billion, the Detroit bankruptcy filing is the largest in U.S. history, but is also one of the most blatant trans-Atlantic examples, of the gutting of the physical economy, and the predations by a swarm of mega-banks, which foisted swaps and other financial rip-offs of city finances. Detroit’s situation alone exemplifies why there must be a re-institution of the Glass-Steagall law, and a bankruptcy-reorganization of the national economy.
    The Detroit bankrupcty filing was made in July by a cohort of those desiring to gut the city, including the governor and state appointed emergency manager Kevin Orr. The filing is contested by city workers and constituents on various grounds, including that there has been no good faith approach to the public good, in the negotiations, in the assertions of insolvency, and in the demands by the city emergency proposals to cut city worker pensions, sell assets and otherwise demolish what remains of Detroit.
    There are thousands of other cities, counties and various local governments in extreme, impossible financial circumstances, in particular throughout the cities of the former industrial heartland of North America—the Great Lakes states.
    In Pennsylvania, for example, there are 21 localities on the state’s “financially distressed” roster, mostly in the beaten-down former coal and steel counties. Dozens of cities and townships, including the state capital, have called on Washington, D.C. to re-instate Glass-Steagall and re-start the economy.
    In 1987, “Act 47” was passed by Pennsylvania, under which the state could declare a locality in financial trouble, and impose severe austerity measures, called “restructuring.” The roster (and date of listing) includes Pittsburgh (2003) and many nearby Allegheny County former heavy industry centers: Clairton (1988), Duquesne (1991), Rankin (1989), Braddock (1988); as well as Johnstown (1992), in the coal county of Cambria; Altoona (2012), a former rail-machining center; and many of the old eastern coal centers, West Hazelton (2003), Nanticoke (2006), Scranton (1992), and finally, Harrisburg (2010), the state capital. ” http://larouchepac.com/node/29021

    ” …….Some experts are now estimating that the payments to the megabanks UBS and Bank of America, which Detroit faces on the “interest-rate swaps” derivatives it was conned into buying, may even be considerably larger than the $225 million reported in EIR’s “Detroit Facts”. According to both the Financial Times and columnist Yves Smith’s Naked Capitalism blog, the city may face immediate looting of $700 million, on top of more than $100 million a year lost to the city for the past eight years on these derivatives bets. The appointment of Kevyn Orr as emergency manager by Gov. Rick Snyder on March 14, was itself a “credit event” potentially triggering a $400 million derivatives payment by the city, one which Orr and the banks may be “not bringing up” until bankruptcy court hearings start…….” http://larouchepac.com/node/27564

    ” Cities and counties are, however, beginning to pay the costs of Detroit “emergency manager” Kevyn Orr’s dirty work for UBS, Bank of America, and their ilk, in steadily rising municipal bond interest rates. Orr said in an early interview that he “didn’t care” what impact his actions had on municipal bond rates, as long as he made the cuts in Detroit. Already, four Michigan counties/cities have had to withdraw bond issues in the past week: Genessee County (A2 rating), $53 million issue; Saginaw County (Aa3 rating), $60 million issue; Battle Creek (AA) $16 million school bond issue; and Hamtramck, a school bond issue. All were contemplating exorbitant rates of 6% or higher. Chicago’s treasurer announced on Aug. 6 that the city’s annual interest cost estimates have risen by $2 million in past two weeks.” http://larouchepac.com/node/27666

    BANK OF AMERICA is also connected with the person of Warren Buffet a friend of JACOB ROTHSCHILD and EVELYN DE ROTHSCHILD.
    http://www.huffingtonpost.com/2011/11/14/warren-buffett-ibm_n_1092165.html
    JACOB ROTHSCHILD “Hosted the European Economic Round Table conference in 2002 at Waddesdon Manor, attended by such figures as James Wolfensohn, Nicky Oppenheimer, Warren Buffet, and Arnold Schwarzenegger ” https://wikispooks.com/ISGP/organisations/introduction/PEHI_Jacob_de_Rothschild_bio.htm https://wikispooks.com/ISGP/organisations/introduction/PEHI_Evelyn_de_Rothschild_bio.htm
    Bank Of America and Merrill Lynch ( subsidiary of Bank of America ) are also related with the Edmond De Rothschild, owned by BENJAMIN DE ROTHSCHILD and ARIANE DE ROTHSCHILD, through the persons of Gerald Levy, Matthieu Walterspiler, Barbara Colombo, Beate Bakker, etc… https://en.wikipedia.org/wiki/Benjamin_de_Rothschild https://en.wikipedia.org/wiki/Ariane_de_Rothschild
    http://www.lejdd.fr/Economie/Images/Les-plus-grosses-fortunes-de-France/Benjamin-de-Rothschild-206941
    http://www.linkedin.com/pub/gerald-levy/60/b49/b87 http://uk.linkedin.com/in/walterspiler http://www.linkedin.com/pub/barbara-colombo/26/b21/766
    http://ch.linkedin.com/pub/beate-bakker/16/a55/491

    UBS IS RELATED WITH BLACKSTONE THROUGH THE PERSONS OF KARL KNAPP AND BRUCE AMLICKE.
    http://www.reuters.com/article/2013/04/18/us-ubs-knapp-idUSBRE93H1B520130418 http://www.zoominfo.com/p/Bruce-Amlicke/20212037
    BLACKSTONE GROUP IS CONTROLLED BY THE ROTHSCHILDS AND IS CONNECTED WITH DEUTSCHE BANK, THE BUSH FAMILY, CARLYLE, AL QAEDA, ETC. .
    http://deanhenderson.wordpress.com/2013/09/27/bin-laden-the-911-illusion-part-ii-deutsche-bank-blackstone/
    http://therearenosunglasses.wordpress.com/2013/10/24/rothschilds-hidden-behind-obama-and-the-genocidal-obamacare/

    THERE ARE LINKS BETWEEN THE UBS AND THE ST. JAMES’S PLACE OWNED BY JACOB ROTHSCHILD FOR EXAMPLE THROUGH THE PERSONS OF JOHN BREWER AND SUSAN HUTTON. http://uk.linkedin.com/pub/john-brewer/15/b97/431 http://uk.linkedin.com/in/susanhutton1
    ” From his headquarters in St James’s Place in London, Jacob Rothschild has cultivated an influential set of clients, business associates and friends who have extended his interests far beyond the normal scope of a banker. ” https://en.wikipedia.org/wiki/Jacob_Rothschild,_4th_Baron_Rothschild
    EVELYN DE ROTHSCHILD SPEAKS VERY WELL ABOUT UBS: ” don’t forget that one of the biggest examples of a bank which – to me – was highlighted, is the wonderful, most prominent banking institution in the world, was UBS. ” http://www.abeldanger.net/2012/07/november-2010-bloomberg-interviews.html
    ” Stefano Rossi that in a famous interview speaks of virtuous countries and of the impending crisis of Greece and of Spain, is CEO of EDMOND DE ROTHSCHILD and began his career in London in 1988. In 1989 he returned to Italy to join Citibank.
    In 1991 he moved to S.G. Warburg and subsequently, with the company’s acquisition by SBC and the subsequent merger with UBS, was promoted in 1996 to Head of Sales at UBS. Appointed in 2001 stock market Manager and Managing Director of UBS SIM, Rossi holds the position of CEO of the italian SIM OF UBS until June 2007. During his career at UBS SIM, Stefano Rossi and his team have been elected for eight times better Italian StockBroker from the Institutional Investors Survey.” http://theyellowbrickroadfreeblog.wordpress.com/2012/05/11/the-rothschild-clan-in-italy-sleuth-bankers/
    THE EDMOND DE ROTHSCHILD IS CONTROLLED BY BENJAMIN DE ROTHSCHILD AND BY HIS WIFE ARIANE DE ROTHSCHILD.
    https://en.wikipedia.org/wiki/Benjamin_de_Rothschild https://en.wikipedia.org/wiki/Ariane_de_Rothschild ………………….

    ” The fight for a Glass-Steagall type banking sepearation in Switzerland is now reaching the boiling point, with the Swiss Banking Association being forced to come out in the open and attack proposed legislation in Switzerland for Bank Separation, while a grouping of political forces are now consolidating their fight to force the legislation. ………………………….
    UBS chief Sergio Ermotti, on the contrary, chose to declare war in an interview with the economic magazine L’Agefi. While the apparent subject of the interview was the UBS gains from its investments in Vodafone, his remarks came down to an attack on the bank separation initiative, and, in particular, on SPP leader Christoph Blocher. In view of those financial gains, Ermotti said, it is understandable why people who want to strengthen the Swiss financial center and its banks, keep pushing bank separation. “It is also fundamentally difficult to carry out a professional discussion on the issue,” he protested….. ” http://larouchepac.com/node/28272 http://www.telegraph.co.uk/news/politics/8875360/Taxman-accused-of-letting-Vodafone-off-8-billion.html
    ( More Evidence of How the British Looted Detroit to Death http://larouchepac.com/node/27516 )
    ( Detroit: Pensions or Derivatives? Glass-Steagall Would Have Made the Choice http://larouchepac.com/node/27528 )
    ( CUTS IN HEALTH INSURANCE FOR DETROIT CITY WORKFORCE http://larouchepac.com/node/28731 )
    http://www.rollingstone.com/politics/news/gangster-bankers-too-big-to-jail-20130214
    ( UBS, Scared by Glass-Steagall, Announces Fake Pre-Emptive ‘Separation’ http://larouchepac.com/node/28739

    THE JUDGE STEVEN RHODES WILL DECIDE IN THE RIGHT INTEREST OF THE POOR PEOPLE OF DETROIT OR IN THE INTEREST OF THE USURERS OF LONDON AND GENEVA ?

    http://wikimapia.org/6825620/fr/Chateau-de-Pregny http://www.panoramio.com/photo/77169200 https://en.wikipedia.org/wiki/Waddesdon http://www.waddesdon.org.uk/ http://www.thefullwiki.org/Waddesdon_Manor http://www.thefullwiki.org/Ascott_House http://www.breathingenglishair.blogspot.fr/2012/04/ascott-house-buckinghamshire.html

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s