How Bad is Detroit's Government? Really, Really, Really Bad

Reading this Detroit News story about the tale of a $1 million dollar check that ended up in a desk drawer for a month before being deposited, I tried to imagine what the city employee was thinking when they so casually and negligently dealt with Detroit's money.

I came to the conclusion that the employee wasn't thinking -- period. As the story makes clear, city employees, their managers, on up the chain to their political masters -- all have embraced a dysfunctional mindset where they believe the problems of the city are so immense, so widespread, that nothing they do can alter the situation for the better.

I worked for a company like that once. Of course, they went bankrupt. But for the six months prior to the firm going under, employees wandered around leaderless and helpless. We were all clock punchers -- barely doing enough work to get by. What didn't need to be done that day could be put off till tomorrow, or next week, or perhaps forever.

There was no leader to grab us by the scruff of the neck and pull us out of the doldrums because the managers were all similarly afflicted.

Such apparently is the case with Detroit; a modern industrial city on its deathbed due to incredible mismanagement and criminally negligent leadership.

In late February, cash-strapped Detroit received a $1 million check from the local school system that wasn’t deposited. The routine payment wound up in a city hall desk drawer, where it was found a month later.

This is the way Detroit did business as it slid toward its bankruptcy filing, which it entered July 18. The move exposed $18 billion of long-term obligations in a city plagued by unreliable buses, broken street lights and long waits for police and ambulances. Underlying poor service is a government that lacks modern technology and can’t perform such basic functions as bill collecting, according to Kevyn Orr, Detroit’s emergency manager.

“Nobody sends million-dollar checks anymore — they wire the money,” said Orr spokesman Bill Nowling. Except in Detroit.

“We have financial systems that are three, four, five decades in the past,” Nowling said. “If we can fix those issues, then we’ll be able to provide services better, faster, more efficiently and cheaper.”

Detroit doesn’t have a central municipal computer system, and each department bought its own machinery — much of which never worked properly, according to Orr, 55, who took over in March. The last such acquisition, 15 years ago, was of a system based on Oracle Corp. technology that wasn’t fully put to work.

The city is buying new software to improve income-tax collection, especially from suburban commuters who work in Detroit, said James Bonsall, the chief financial officer hired by Orr. The dysfunction extends beyond machinery, Nowling said.

Union rules have “bumped” workers into positions they aren’t qualified for as departments make cuts, he said. The city has no training programs and doesn’t evaluate employees in 2,500 job classifications.

“It has nothing to do with bad employees,” Nowling said. “These employees in some instances are still following work rules that were created 40 years ago.”

Detroit’s operational flaws are pronounced, according to a June 14 report from Orr.

It costs the city $62 to process each paycheck, every pay period, for its 9,560 employees, compared with an average of $18 for U.S. public employers, Orr said in the report. The main reason for the high cost is that almost 150 full-time workers produce Detroit’s payroll, including 51 uniformed officers.

The city’s income-tax receipts are processed by hand, among the 70 percent of accounting entries done manually, according to Orr. He said in his report that the U.S. Internal Revenue Service described Detroit’s tax-collection system as “catastrophic” in a July 2012 audit.

Someone -- or a lot of people -- should go to jail for allowing city government to reach such a low level of competence and efficiency. Say what you want to about the Chinese Communists, but incompetent local governance there leads to managers going to jail -- even executed if corruption is involved.

It goes far beyond the breaking of trust between the people and their government in Detroit. It is the systematic looting of taxpayer funds by public unions and corrupt politicians who knowingly allowed this state of affairs to fester until it was far too late and ennui set in.

I don't blame the poor schmuck who left the check in their desk for a month. I blame city leaders who knew what was happening and continued with business as usual because business was profitable to a select few. If I were a Detroit city worker, I'd probably have left the damn check in a drawer for a month too.