Though it is the biggest city in U.S. history to file for bankruptcy, Detroit is only one of 26 urban municipalities that have gone into bankruptcy or state receivership for fiscal insolvency since 2008. Detroit should draw attention and debate to a challenging issue underlying all these public insolvencies: What level of public services will we protect and guarantee for U.S. cities?
The Bankruptcy Court will have to face that question. It will have to determine whether Detroit can cut into current services any more than it already has.
Unless the state or federal government steps in with funds for operating costs, the bankruptcy will function as a zero-sum game, with residents fighting creditors for a share of city revenue. Creditors have contracts to monetize what they are seeking, but how should the court determine the public spending that residents need today and tomorrow?
Politicians and judges who manage local fiscal crises speak of maintaining basic services and ensuring residents' minimal health and safety, but these concepts are short on specifics. While our laws provide an entitlement to a public education, and we have long struggled to interpret what constitutes a legally adequate education, there is little to nothing that would tell us what other services the local public sector must provide.
As a matter of law, there is no such thing as a crime rate that is too high or an ambulance response time that is too long. Should there be?
For now, it is left to politics and moral judgment to determine whether it is acceptable that less than one in three streetlights are operational in Detroit or that the city has 80,000 abandoned and blighted structures that it cannot afford to demolish. In Detroit, as in many other struggling cities, dramatic police layoffs mean that the average wait time after a 911 call for a police officer is 58 minutes, and a resident can rarely summon an officer at all if the reported crime is not in progress and violent.