Detroit people’s assembly to challenge banks’ rule

Sept. 30 — Activists in this beleaguered city are in the final days of organizing for an International People’s Assembly Against the Banks and Against Austerity. It is set for Saturday and Sunday, Oct. 5 and 6, at Grand Circus Park in downtown Detroit. The event coincides with the Oct. 5 five-year anniversary of the federal bailout that netted the biggest banks more than $700 billion in workers’ tax monies.

Participants are coming from coast to coast, as well as from metro Detroit and other cities in Michigan. Organizers report solidarity messages are arriving from around the world, including from workers’ organizations in Panama, Lebanon, France, Indonesia, Brazil and elsewhere.

This People’s Assembly will meet in a city devastated first by the corporations and then by the banks, which are now poised to swoop in and suck out its remaining lifeblood.

The city of Detroit is under the control of an Emergency Manager appointed by reactionary Republican Gov. Rick Snyder. Emergency Manager Kevyn Orr has filed the largest municipal bankruptcy in U.S. history, abrogating collective bargaining agreements, overturning workers’ pensions and threatening to sell the city’s assets — all on behalf of the bankers, who are bent on taking every last dollar from the workers and poor.

Detroit, a majority African-American city and once a stronghold of the Black Liberation movement and the union movement, lost one-quarter of its population in the last dozen years as a direct result of more than 100,000 home foreclosures. Some 73 percent of the city’s residents had been lured into predatory subprime, often fraudulent loans written by every major bank.

After destroying most of its neighborhoods, the banks came after the city itself, sucking it into predatory bond deals such as interest rate swaps and pension obligation certificates. That left the city paying hundreds of millions of dollars in hedging derivatives and termination fees to the very banks that profited from the financial collapse they had caused.

Administration officials come to Detroit

The Moratorium NOW! Coalition to Stop Foreclosures, Evictions and Utility Shutofffs issued a call for a demonstration when high-ranking officials from the Barack Obama administration came to Detroit on Sept. 27 for a meeting at Wayne State University with Gov. Snyder, EM Orr, Mayor Dave Bing and others. The invitation-only gathering was a media spectacle to announce that over $300 million in federal funds would be released to assist the city.

This visit signaled the de facto support of the Obama administration for the imposition of an emergency manager over the city, the overriding of elected city officials, and the federal bankruptcy filing.

Nevertheless, a majority of Detroiters have rejected the idea of bankruptcy. Voters statewide overturned the emergency manager law last November, only to have the governor and state legislature stampede through a new EM law against the will of the people. The EM is commonly referred to as the “emergency dictator” by residents of Detroit and other cities.

Advancing concrete, doable demands

“The visit of Obama administration officials to Detroit,” read a Moratorium NOW! statement calling for the Sept. 27 demonstration, “can be an important development in restoring hundreds of millions of dollars in federal funds to the City of Detroit to alleviate the financial crisis facing the city. But this will not be the case if Obama’s officials choose to meet with and listen to Gov. Snyder, EM Orr, Mayor Bing and other officials who have deliberately withheld federal funds from Detroit to further their agenda of privatization, union busting and subsidies for the banks.”

The coalition statement also addressed what actions benefiting workers and residents could be implemented immediately if the political will existed to do so. All these demands have been raised by the coalition during the ongoing struggle over the last several years.

The coalition stated: “Here is a list of concrete ways the Obama administration can funnel needed funds to Detroit. All of these can be done by executive action and do not require approval of the reactionary Republican House of Representatives:

• “The administration can order the release of hundreds of millions of dollars of Community Service Block Grant funds to Detroit, under the auspices of the City and administered by City workers. In October 2011, State Dept. of Human Services head Moira Corrigan illegally withheld these funds from Detroit in an effort to force the city to give up the right to administer the grants. As a result, funds have been withheld from the neediest Detroiters for whom CSBG grants offer rental, heat, and food assistance. Bing and City Council capitulated to Corrigan’s illegal acts. Restoring the CSBG grants to the administration of the city, by the same workers who effectively worked the program for years (perhaps minus a few rotten supervisors), would mean dozens of workers would be restored to the city’s workforce. Their wages and benefits would be paid out of the federal grant, helping to put a halt to the deliberate depleting of the pension fund by Snyder.

• “Similarly, the Obama administration can restore the administration of the Detroit Head Start program to the City of Detroit, which administered it for over 45 years until Mayor Bing inexplicably and illegally ceded control to a Denver-based outfit with the consent of the Obama administration. Restoring the administration of the Head Start program to the City would immediately bring $25 million in funds to the city, and employ 40 City workers.”

Save peoples’ homes,
investigate the banks!

• “President Obama could order Snyder and the Michigan State Housing Development Authority to immediately remove the impediments they imposed on the release of the $500 million in federal Helping Hardest Hit Homeowner Funds to serve their purpose, helping homeowners remain in their homes. Some 10,000 Detroit homeowners face losing their homes to tax foreclosures despite the availability of hundreds of millions in federal funds to pay delinquent property tax bills. Snyder’s and MSHDA’s deliberate withholding of these funds is contributing to the loss of homes, decline in neighborhoods and depletion of Detroit’s population and tax base. It is also contributing to the City’s deficit as Detroit is paying $82 million in chargebacks to Wayne County for lost value of tax-foreclosed homes, which could be avoided if the Hardest Hit funds were released.

• “The Obama administration, through the Securities and Exchange Commission and the Department of Justice, could order an investigation of the banks whose subprime lending practices were the major factor in destroying the City’s tax base over the last decade. Similarly, the SEC and DOJ could launch similar investigations to those carried out across the U.S. regarding municipal bond practices of banks like Chase, UBS and Bank of America, LIBOR manipulation by the banks with regard to Detroit’s bonds, and the use of the ISDA Fix by the banks to calculate termination fees on interest rate swaps. In addition the SEC and the Justice Department should investigate the role of the ‘ratings agencies’ Standard and Poors, Moody’s and Fitch, in encouraging subprime mortgage lending in Detroit, as well as ‘encouraging’ the City to be placed in onerous interest rate swaps in 2005-2006, then lowering the City’s bond rating, placing these bond deals in default to benefit the banks who pay the agencies.”

Stop gov’t. foreclosures,
moratorium now!

• “Whenever a State of Emergency is declared, it is the policy of the HUD Secretary to place a 90-day moratorium on foreclosures and foreclosure-related evictions, which can be extended by executive order. Foreclosure moratoriums were put into effect after Hurricanes Katrina and Sandy. The basis for placing an Emergency Manager and subsequent bankruptcy on Detroit was Snyder’s declaration of a state of financial emergency. Based on this emergency declaration, HUD Secretary Donovan should immediately impose a moratorium on foreclosures and foreclosure-related evictions.

• “In addition, because Fannie Mae and Freddie Mac, agencies of the federal government, along with HUD, own the vast majority of mortgage loans in Detroit, the Obama administration should stop all foreclosures and foreclosure-related evictions by these federal agencies. Considering the fact that virtually all residential mortgages in Detroit are severely underwater, contributing to people abandoning their residences, the Obama administration should also reduce the principal on all mortgage loans owned by Fannie Mae, Freddie Mac or backed by HUD, to the actual value of the home.”

Meet with the people, not big business!

Moratorium NOW! organizers were joined at the Sept. 27 demonstration by activists from Detroit Eviction Defense, along with municipal workers, retirees and members of other organizations from around metro Detroit. They demanded that the president’s officials meet with the workers and city residents instead of representatives of big business and the banks.

The results of the high-level meeting were as organizers expected. Obama administration officials pledged additional grants on top of the already-unutilized grants provided to the city. Private capitalists, including Dan Gilbert, founder of Quicken Loans, were appointed to help head up a “blight removal” program to tear down the more than 70,000 abandoned homes and structures in Detroit at a cost of $150 million.

Quicken Loans, instead of being punished for its role in the demise of the city, has been rewarded with oversight of this public money. Roy Roberts, the former emergency manager of Detroit Public Schools, will be the new “chief land officer” for the city. Organizers characterized the meeting as “typical” of how the right-wing agenda of privatization, cutbacks, austerity and enrichment of the banks is moving full steam ahead in Detroit.

Fightback vs. banks, austerity

Abayomi Azikiwe, a Moratorium NOW! leader and a main organizer for the People’s Assembly, told Workers World that the Oct. 5-6 gathering in downtown Detroit “will focus on a fighting program to take on the banks — the very pinnacle of finance capital — in the struggle against banker-imposed austerity and cutbacks. It will link with the struggles of people around the U.S. and the world who face similar plights at the hands of the capitalists and their political backers.”

Azikiwe continued: “It’s our hope that people will go away from this assembly with a greater commitment to fight against emergency management, which is the bankers’ rule of Detroit. Hopefully this will set a precedent for other cities that are facing similar crises, because not only Detroit is under threat, but urban areas throughout the U.S. are facing pension cuts, disempowerment of communities, destruction of neighborhoods, theft of pensions, etc. We want to build greater awareness to fight against austerity and the banks.”

Organizers say a major demonstration, backed by the Moratorium NOW! Coalition; the American Federation of State, County and Municipal Employees Council 25; and Detroiters Resisting Emergency Management, will be called for Oct. 23 outside the federal bankruptcy court as the bankruptcy eligibility trial takes place.

For more information on the Oct. 5-6 International People’s Assembly and the struggles against emergency management and municipal
bankruptcy, visit these websites:
moratorium-mi.org,
internationalpeoplesassembly.org and detroitdebtmoratorium.org.