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Tag Archives: Detroit

Baby Bailout: White House to Send Millions to Detroit

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.

Uh, Obama Wasn’t Referring to the City of Detroit

President Obama is getting zapped today for repeatedly saying during the 2012 campaign that he didn’t let Detroit go bankrupt, and for slamming Mitt Romney for saying he would.

And now – the hypocrisy! – he is standing still and doing nothing while Detroit, yes, goes bankrupt. But of course, neither Obama nor Romney were talking about the city of Detroit. They were talking about the auto industry, which is often referred to as “Detroit.”

How cynical for people to be attacking Obama now as if he had promised to rescue the Motor City itself. It’s as if he said he was “shopping for china” and people starting accusing him sending money to Beijing.

What Obama is doing now is actually a rare example of West Wing discipline and conservatism. The president is refusing to bail out a city that has been irresponsible and poorly run for decades and still doesn’t  have a plan to make things right.

In fact, Detroit apparently only declared bankruptcy after city officials begged the White House for help and were told by Valerie Jarrett to kindly take a hike.

Fiscal responsibility? The Obama White House? Are the Obama people beginning to realize we’re out of money and that bailouts only breed more irresponsibility?

I doubt it. But so far they’re taking the right approach toward Detroit and shouldn’t be held accountable for something they never said.