Commentary
Detroit Should Sell Some Paintings
Unfair to make the many subsidize amenities for the few
As the prospect draws closer of a state bailout of Detroit at the expense of other critical needs, voters might want to examine more closely politicians’ skittishness toward selling off city assets. In particular, artwork owned by the city’s museum, an institution sustained by tax dollars (including a regional property tax favored by many of those same politicians in 2010).
Lawmakers should reject a bailout and instead insist that Detroit — whose problems are the product of its own fiscal malpractice — take responsibility for cleaning itself up. It is fundamentally unfair to make other Michigan residents pay for such infamous mismanagement. If avoiding this inequity requires the city to sell some assets, including paintings from the museum, so be it.
In fact, government support for the arts is itself another form of inequity: Tax dollars taken from the many subsidize the highbrow recreation of a relative few. Now Lansing politicians want Michigan taxpayers to give up another $350 million for a bailout that proponents admit is largely about preserving an amenity for the elite.
Selling off some art could go further to reducing bankruptcy pain than bailout advocates admit. They downplay this potential by pointing to a low-ball value estimate of $867 million for the art, but one bond insurer has solicited bids that could generate $2 billion. Putting a ring-fence around this asset leaves money on the table that could reduce the hit to the city’s pensioners and others.
Among those others are people and institutions who have lent money to the city and for whom there has been little sympathy. In some cases that may be understandable, but stinging creditors could increase future borrowing costs for all Michigan communities, making needed infrastructure improvements that much harder, plus adding another obstacle to Detroit’s own long-awaited Renaissance.
The first priority of legislators should be to protect their constituents from a misguided bailout of Detroit. Sell some art and other assets, contract out many services and end unnecessary ones. Any other solution would be fundamentally unfair and would encourage more bad behavior in Detroit and other poorly managed cities.
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Detroit Should Sell Some Paintings
Unfair to make the many subsidize amenities for the few
As the prospect draws closer of a state bailout of Detroit at the expense of other critical needs, voters might want to examine more closely politicians’ skittishness toward selling off city assets. In particular, artwork owned by the city’s museum, an institution sustained by tax dollars (including a regional property tax favored by many of those same politicians in 2010).
Lawmakers should reject a bailout and instead insist that Detroit — whose problems are the product of its own fiscal malpractice — take responsibility for cleaning itself up. It is fundamentally unfair to make other Michigan residents pay for such infamous mismanagement. If avoiding this inequity requires the city to sell some assets, including paintings from the museum, so be it.
In fact, government support for the arts is itself another form of inequity: Tax dollars taken from the many subsidize the highbrow recreation of a relative few. Now Lansing politicians want Michigan taxpayers to give up another $350 million for a bailout that proponents admit is largely about preserving an amenity for the elite.
Selling off some art could go further to reducing bankruptcy pain than bailout advocates admit. They downplay this potential by pointing to a low-ball value estimate of $867 million for the art, but one bond insurer has solicited bids that could generate $2 billion. Putting a ring-fence around this asset leaves money on the table that could reduce the hit to the city’s pensioners and others.
Among those others are people and institutions who have lent money to the city and for whom there has been little sympathy. In some cases that may be understandable, but stinging creditors could increase future borrowing costs for all Michigan communities, making needed infrastructure improvements that much harder, plus adding another obstacle to Detroit’s own long-awaited Renaissance.
The first priority of legislators should be to protect their constituents from a misguided bailout of Detroit. Sell some art and other assets, contract out many services and end unnecessary ones. Any other solution would be fundamentally unfair and would encourage more bad behavior in Detroit and other poorly managed cities.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.