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Rhodes And Orr Say Trillions In Unfunded Liabilities Exist Nationwide

Last Wednesday Crain’s Detroit Business named former Emergency Manager Kevyn Orr and Judge Steven Rhodes as the 2014 Detroit Newsmakers of the year. Crain’s reporter Amy Haimerl joins hosts Laura Weber-Davis and Stephen Henderson to talk about the newsmakers.

The Detroit bankruptcy was a national and international story. Bankruptcy Judge Steven Rhodes says unfunded pension liabilities could become an issue nationwide. Haimerl says Rhodes thought there may have been a missed opportunity in the bankruptcy, and she questions if other cities will miss the same one.

It’s interesting that Judge Rhodes said that he thought the Detroit Bankruptcy might have had a missed opportunity in converting city workers going forward into defined contribution type retirement plans, that’s your typical private sector 401k,” says Haimerl. “So, it will be interesting to see if cities around Michigan, or around the country, start listening to that and saying that we’re going to have to make changes for going forward and what does that mean for looking back.”

Haimerl also discusses an upcoming story about a new non-profit law firm started by Wayne State Professor Eric Williams and four of his recent law school graduates which will focus on providing discounted legal help for start-ups in Detroit. This non-profit has partnered with Bodman, which Haimerl says means that the entrepreneurs can still feel secure in the advice they are receiving.

You wind up paying the bill one way or another. You pay it at the front end or you pay it at the back end, so these are going to help you pay it at the front end when it’s cheaper than the clean up later,” says Haimerl.

 

Photo Credit: Gerald R. Ford School of Public Policy, U of M / CC

Image credit: Gerald R. Ford School of Public Policy, U of M / CC

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Pension Cuts Become Reality For Detroit City Workers

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