The Rubber Stamp

Multimillion-dollar contract with Jones Day

Apr 24, 2013 at 12:00 am

IT’S NOT OFTEN that the commies at News Hits and the diehard capitalists at Crain’s Detroit Business find themselves in agreement, but that’s what happened last week. Credit for fostering this unlikely concord goes to Detroit Emergency Manager Kevyn Orr and his former law firm, Jones Day.

Crain’s weighed in on the issue prior to the Detroit City Council vote last Tuesday approving the multimillion-dollar contract for overseeing the city’s financial restructuring.

This is what Crain’s had to say in an editorial:

“Until last month, Detroit’s new emergency manager, Kevyn Orr, was a Jones Day partner. Yes, technically, he resigned and surrendered his partnership to take the Detroit job.

“But awarding the contract will absolutely reinforce a pervasive suspicion in Detroit that rules exist for ‘other people’ — not the well-intentioned power brokers trying to put Detroit back together. This is not the message you want to send as the city emerges from the taint of fraud and insider deals during the era of Kwame Kilpatrick Inc.”

A majority of the council didn’t see things that way though, and voted 5-2 in favor of the contract.

It is worth noting that the council didn’t actually have to take a stand on the controversial contract. It could have remained entirely mum.

That wouldn’t have stopped Jones Day from getting the contract, but the silence would have spoken volumes about the role this council sees itself playing now that it’s been stripped of any real authority after the installation of the emergency manager.

As pointed out by councilmember JoAnn Watson (who, along with Brenda Jones voted against the contract), the council could have laid the whole controversy in the lap of Orr, who has the authority to sign contracts with whomever he wants, regardless of what the council thinks.

In voting to approve the deal, though, the council gave the agreement a legitimacy it wouldn’t have enjoyed otherwise, Watson argued. The message from a majority on the council was clear: They are going along with the program, trusting that Orr and Jones Day are as ethical as Edward Keelean, the interim city attorney, professes them to be.

With Jones Day listing Bank of America among its many clients, we can only hope Keelean’s assessment is correct, because the bank (through its Merrill Lynch subsidiary) is a bondholder involved in a controversial credit swap deal that could cost the city as much as $400 million.

Watson equated the situation to having the same lawyer represent both a husband and wife in divorce proceedings. The council’s Research & Analysis Division also voiced concerns about the arrangement.

But a majority of council, not to mention Mayor Dave Bing, has shown a willingness to go along with the governor’s program in solving the city’s financial crisis.

The wheels of government are all moving in the same direction and last week’s raucous protest, which culminated in two people being arrested, demonstrated that opponents of the emergency manager law may be able to stir things up and slow them down, but they aren’t stopping anything.

At least, at this point.


THERE ARE SOME, perhaps many, asking: What good can be accomplished by these sort of disruptive actions?

The Rev. Bill Wylie-Kellermann, one of the people arrested, provided an answer when he addressed the council during the public-comment portion of its meeting. Wylie-Kellermann, pastor of Detroit’s St. Peter’s Episcopal Church, began his remarks by quoting from the Rev. Martin Luther King Jr.’s  “Letter from a Birmingham Jail.”

The famous missive was written in response to eight white Alabama clergymen who had publicly criticized King and the disruptive, nonviolent protests he was leading. Noting that the Birmingham Jail letter was written 50 years ago on April 16, Wylie-Kellermann read the council this passage:

“You express a great deal of anxiety over our willingness to break laws. This is certainly a legitimate concern … One may well ask: ‘How can you advocate breaking some laws and obeying others?’ The answer lies in the fact that there are two types of laws: just and unjust. I would be the first to advocate obeying just laws. One has not only a legal but a moral responsibility to obey just laws. Conversely, one has a moral responsibility to disobey unjust laws. I would agree with St. Augustine that ‘an unjust law is no law at all.’”

The way the protesters see it, they have a moral duty to oppose the state’s EM law — which is the subject of a federal lawsuit challenging its constitutionality.

As Wylie-Kellermann, a longtime progressive activist, told the council:

“This day the Detroit City Council votes the Jones Day contract. It is a moment to slow down and take note. It is, in fact, a time to say Stop. Just like a tree, time to not be moved.

“Many expensive lawyers are required to give the pretense of legality, the appearance of constitutional legitimacy.  This contract is the lynch pin in Detroit of ‘restructuring.’ If Detroit were a country in the global south, Africa or Latin America, under egregious debt to the World Bank, this process would be called ‘structural adjustment.’ The crisis is created, [and] then managed. Resources are taken, budgets are cut, people suffer losing land, education, utilities, services. But the debt is always served.”


News Hits is written by Curt Guyette. Contact the column at 313-202-8004 or [email protected].