Backdoor Bailout

Here’s what’s next for Detroit’s pensioners:

As Detroit enters the federal bankruptcy process, the city is proposing a controversial plan for paring some of the $5.7 billion it owes in retiree health costs: pushing many of those too young to qualify for Medicare out of city-run coverage and into the new insurance markets that will soon be operating under the Obama health care law.

Officials say the plan would be part of a broader effort to save Detroit tens of millions of dollars in health costs each year, a major element in a restructuring package that must be approved by a bankruptcy judge. It is being watched closely by municipal leaders around the nation, many of whom complain of mounting, unsustainable prices for the health care promised to retired city workers.

The exchanges, of course, are subsidized by either the Federal income taxes you pay, or (perhaps more likely) by the debt Washington is forcing on our kids. So in a sense, Detroit is indeed receiving a Federal bailout. Also notice that bit in the last line, where the move is “being watched closely by municipal leaders around the nation.”

Lots of broke Blue cities out there, folks.