Could Detroit's Automakers Save Its Art Treasures?

Chrysler, General Motors and Ford offered up a multi-million dollar deal to help the bankrupt city of Detroit. But are there any strings attached to the cash and will it be enough to save the city?

Copyright © 2014 NPR. For personal, noncommercial use only. See Terms of Use. For other uses, prior permission required.

MICHEL MARTIN, HOST:

Let's turn now to Detroit where the city's effort to come back from bankruptcy just got a boost. The Big Three automakers - Ford, General Motors and Chrysler - have put down some serious financial muscle to help save the Detroit Institute of Arts, the DIA - $26 million to be exact. That could help save the city from having to sell the art to satisfy creditors. It's not just art admirers who are keeping their eye on this deal. People, from retirees worrying about their pensions to the creditors Detroit owes, could be affected by this.

We wanted to find out more, so we've called Rochelle Riley once again. She's a writer and columnist with the Detroit Free Press - with us from WU Michigan. Also with us, Quinn Klinefelter, senior news editor for WDET - with us from their studios. Welcome back to you both. And, Quinn, I'm just going to jump right in. Tell us about this grand bargain. What does it do?

QUINN KLINEFELTER: Well, it's something that's trying to prop up the pension system that has really been in trouble in Detroit and is one of the cruxes, actually, in the bankruptcy proceeding - and as you say, try to save the artworks from the Detroit Institute of Art, which are very lucrative and which a lot of the creditors of the Detroit owes money to as it goes through the bankruptcy proceedings - they say you ought to sell that and help try to pay us off. This agreement between the state and some private foundations came together to say, well, we will soften the blow to these pensioners and therefore you won't have to sell the artwork to try to soften the blow through that. And so the car companies are putting in this money as a portion of that.

It's a portion of the art - the museum itself - it has to raise part of this so-called grand bargain - it's 800 plus million dollars. Also, the state's got some money in that they just had approved through the votes in the legislator that was a little bit contentious for a while, but then they all came together at the end. And so it's all trying to come together to preserve this art and people were praising it. Although, you know, it is really a fairly small amount compared to how much the overall bankruptcy is. But in terms of what it can mean for the artwork and for the pensioners, it's very sick.

MARTIN: Rochelle Riley, we've been coming to you from time to time to just get the temperature of things, of how people are reacting to these various moves. Give us your sense of how this is being received.

ROCHELLE RILEY: Well, as we always talk about, there are two Detroits. And the Detroit that wants this to work are celebrating that everybody's participating. Everybody's sort of putting some money in. As Quinn said, the audio industry donation is only $26 million. To put 'only' in front of 26 million sounds terrible, but when you're talking about $816 million, it's a small amount. But it signifies that they're a part of it, so there's this coming together.

But then you've got the actual pensioners - some of whom are living week to week - who don't like this deal. They do not think that the bargain is a bargain for them, and a lot of them don't plan to vote for it. And it does have to be approved by two classes of pensioners, the police and fire pensioners who are in one class and the general retirement pensioners - the other city employees - former city employees- in another class. And both of those groups of people have to approve this. So we're a long way from done.

MARTIN: Does this, Rochelle - does this do anything to intervene in this narrative of feeling as though all is lost? When we last spoke with you, there was just a lot of sadness, as you would imagine, around so many of these issues. And it just seemed like the bad news was unrelenting.

Does this intervene in that at all? Does it give people any sense of hope, even if it is a relatively - it sounds big - but it is actually a fairly small amount in the big scheme of things?

RILEY: It actually does. I can tell you what a difference several months makes. There's a new mayor, Mike Duggan, who has made a lot of changes in the city that have helped to not just appease but to provide some sense of relief for residents who have felt very put upon. You know, there were 25 parks that were being maintained, you know, six months ago, and there's now more than 200. And some of the lights are on in the city where, as you know, a lot of the lights were off and it was dark at night. So there are some very practical things that are happening.

And quite frankly, for some of the pensioners - they were initially talking about cuts as high as 25 percent of their pensions. And it is much lower now because of this. And Emergency Manager Kevyn Orr has made it clear that the deal is not going to get better than this. The people who are holding out hope that it might be, you know - there might be more money somewhere. There might be something better if they do reject this. He's made it clear that it's not.

So for some folks - they really are glad that they did change that cut so that it's not, you know, a quarter of their pension and them having to make a decision between medicine and food, but something much smaller. So the grand bargain has brought in a lot of money that didn't exist.

MARTIN: Quinn, take the last word here if you would and just give us a concluding thought - whatever you think we should be thinking about next as we watch this, you know, important story unfold. What's coming along?

KLINEFELTER: Well, two aspects probably - the first is there will be a confirmation hearing, which just got delayed until mid-August, with the creditors where they will bring up all their reasons that they oppose this happening, and a lot of problems that they see with it. They stand to lose hundreds of millions of dollars - the people that loaned money to Detroit, and they're not going to get it back. The pensioners are pretty much up against it, although there are a fair amount of unions that say they are going to try to fight the deal as well because they don't think that it's really going to help them.

And then, as Rochelle says, the city, in very many ways, is kind of two cities. And there are people in the outer ring neighborhoods that say they don't feel the investment coming into the downtown or midtown areas. And they fear that they're being left behind. And along with all that, there's other cities teetering on bankruptcy or being crushed by similar pension obligations that are watching what happens in Detroit and seeing if that's what the path can be that they can follow to get out from under their obligations.

MARTIN: That was Quinn Klinefelter. He's the senior news editor from member station WDET. Also with us, Rochelle Riley, columnist for the Detroit Free Press. It's good to talk with both of you once again. Please keep us posted. Thank's for joining us.

RILEY: Thank you.

KLINEFELTER: Thank you.

Copyright © 2014 NPR. All rights reserved. No quotes from the materials contained herein may be used in any media without attribution to NPR. This transcript is provided for personal, noncommercial use only, pursuant to our Terms of Use. Any other use requires NPR's prior permission. Visit our permissions page for further information.

NPR transcripts are created on a rush deadline by a contractor for NPR, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of NPR's programming is the audio.

Comments

 

Please keep your community civil. All comments must follow the NPR.org Community rules and terms of use, and will be moderated prior to posting. NPR reserves the right to use the comments we receive, in whole or in part, and to use the commenter's name and location, in any medium. See also the Terms of Use, Privacy Policy and Community FAQ.