Great white massa: “City in denial regarding its need for help.”
“Concept of civil unrest or civil disobedience not really on my mind, Rhodes says, despite running off the bench when pastor Bill Wylie-Kellerman stood up in audience, declaring, “Jones Day is not the City of Detroit.”
By Diane Bukowski
Feb. 21, 201
DETROIT – As 32,000 active and retired City of Detroit workers wait for the ax to fall on their pensions, wages and health benefits March 1, plummeting many of them below the poverty level, U.S. Bankruptcy Judge Steven Rhodes is busy congratulating himself on the bankruptcy’s alleged success as he retires.
Now that he thinks he’s out of the line of fire, he played the infamous “race card” in an interview with the Free Press.
“Part of the decline of the city itself can be attributed to our unique racial circumstances,” he told the Free Press in an online video, attached to a brief article that left out most of what he said to the camera, as well as whatever else he discussed in a “broad-ranging 90-minute interview.”
“The city was desperate, and desperate people and desperate entities do desperate things,” Rhodes continued, psychoanalyzing Detroit’s Black population with regard to the notorious $1.5 Billion Pension Obligation Certificates deal of 2005-06 (known as “COPS”). He claimed the city should have declared bankruptcy then.
“We see that in bankruptcy all the time,” Rhodes continued. “As I have said, the city was in denial regarding its need for help, regarding its insolvency, and could not psychologically contemplate public embarrassment or humiliation associated with filing bankruptcy. So they entered into this creative and quite likely illegal deal.”
He also told the Freep, “The concept of civil unrest or civil disobedience was not really on my mind,” despite Detroiters’ anger against the imposition of an Emergency Manager and of the bankruptcy.” However, when Pastor Bill Wylie-Kellerman rose during a hearing to tell Jones Day attorneys, “You are not the City of Detroit,” Rhodes ignominiously ran off the bench to hide.
In a second interview with WDET Radio, Rhodes said the POC deal, “. . . was structured to be an intentional evasion of the legal debt limits that municipalities by state law are required to stay within. It was too innovative, it was too creative and um that by itself should of been a red flag at the time.”
Rhodes here admits for the first time in public that he knew of the illegalities and likely fraud involved in the POC scam. Emergency Manager Kevyn Orr as well as bond insurer FGIC both filed lawsuits against the case. Wallace Turbeville, a senior analyst at DEMOS and former Wall Street banker, pointed out the fraud involved in a paper published in Nov. 2012, but Rhodes refused to have him testify during the bankruptcy case.
“As an officer of the court, a judge with integrity would first stop the proceedings, and investigate the legality of the debt,” Cornell Squires, a paralegal with We the People for the People, said. “Instead, they rushed the process, to make taxpayers and retirees responsible for billions of dollars that we shouldn’t have to pay back. This involves the doctrine of unclean hands. Rhodes doesn’t have any integrity whatsoever. His approval of the bankruptcy makes him a a stone racist, because the majority population of Detroit are people of color. No one’s above the law. He should be ashamed of himself. He did the damage knowing he’s going to leave and enjoy retirement, unlike city workers. This is differential treatment—worse than the South. As an officer of the court, he should have seen to it that criminal charges were brought. Detroit is a crime scene, with the banks destroying the city and our people. Kwame went to jail for 28 years. Why can’t they go to jail? How much time do you get for stealing a whole city?”
Rhodes set a trial date in June 2015 to hear the Orr lawsuit, but with the help of U.S. District Court Chief Judge Gerald Rosen, he pressed the trial to an early conclusion in December, 2014.
The deal took place under the administration of former Mayor Kwame Kilpatrick. His CFO Sean Werdlow negotiated the terms with global Swiss-based bank UBS AG, and Siebert, Brandford and Shank (SBS), a partner backed by the Bank of America. Werdlow was appointed to an executive position with SBS in Dec. 2004 and is now its COO. Also at the table to press the deal were Wall Street ratings agencies Standand and Poor’s and Fitch Ratings.
But Rhodes implies in his comments that the deal was only Kilpatrick’s fault, who he termed the only city mayor to be federally charged. It wasn’t the fault of the greedy white one percent who control the wealth of Detroit and the U.S.
Other articles reported that if the POC deal was canceled, health care for retirees could have been restored. By the time of the bankruptcy, the POC debt had skyrocketed to $2.8 Billion, with interest, penalties and fees. Instead of cancellation, however, the Eighth Amended Plan of Adjustment provides healthy settlements for UBS AG, SBS, and Bank of America. In the shadows, it handed over control of key municipal properties and billions in revenues including the Joe Louis Arena, the Detroit Windsor Tunnel, and the Grand Circus Park garage, to bond insurers FGIC and Syncora.
Throughout the trial, Rhodes falsely portrayed himself as part of Detroit, throwing crumbs to let retirees and others testify pro se. However, an internet address search for Rhodes shows that his only addresses have been 1610 Arborview Blvd, Ann Arbor, MI 48103; 1503 Linwood Ave, Ann Arbor MI 48103; and 1005 Pittsburg Ave, Cape May, N.J.
If former Mayor Kwame Kilpatrick got 28 years in prison for allegedly stealing about $400,000, how much time should Rhodes, Rosen, Orr, Jones Day and other law firms, and Wall Street bankers get for stealing the entire city of Detroit?