Updated 10:25 am ET
Even as the nation sits on the edge of a financial crisis driven by the need to incur more debt, the White House has found $300 million to send to mismanaged, financially beleaguered Detroit, according to CNN.
The money is being taken “from programs that are available for cities across the nation, not just Detroit.”
The action amounts to a backdoor assistance plan that effectively circumvents Congress, which would not support a bailout. A White House official was vague on how the money had been cobbled together.
According to an AP story, which had stated the total at $100 million:
Gene Sperling, chief economic adviser to President Obama, said the administration scrounged through the federal budget and found untapped money that “either had not flowed or had not gotten out or not directed to the top priorities for Detroit.”
How it is that there is $300 million lying around for Detroit is unclear. Sperling, who is from Michigan, is director of the White House National Economic Council but will be leaving the post January.
Though a significant sum, the money will make hardly a dent in Detroit’s $18 billion in debt. What’s more, the AP notes, “Detroit has had a poor record in making sure grant money is used properly and even spent at all.”
Sperling, Attorney General Eric Holder, Transportation Secretary Anthony Foxx and HUD Secretary Shaun Donovan are meeting with state and local officials today to discuss the funding.