Looking to Buy a Giraffe? Detroit Can Hook You Up.

But at least zoo animals don't earn pensionsCredit: ucumari / Foter.com / CC BY-NC-NDDetroit’s going-out-of-business sale is looking to be quite the affair. The Detroit Free Press examined the disparate and sometimes unusual assets left in the city that may be sold in order to pay off its debts:

A healthy, breeding female giraffe from the Detroit Zoo could fetch $80,000 on the open market. Detroit’s half of the Detroit-Windsor Tunnel was valued a few years ago at $65 million. A prototype of the 1963 Ford XD Cobra owned by the Detroit Historical Museum carries an estimated price of $1 million. …

Detroit is teetering on the brink of the largest municipal bankruptcy in American history. The city’s emergency manager, Kevyn Orr, and his team have said they want to evaluate everything owned by the city as they begin negotiations with creditors in the face of $15 billion to $17 billion in debt and future pension obligations.

Orr already created a tsunami of controversy when he acknowledged late last month that billions of dollars worth of art owned by the city and housed at the Detroit Institute of Arts were vulnerable to creditors. But he potentially could sell or privatize numerous other city assets, too, from public parks to operations of the city’s Water and Sewerage Department to sundry treasures found in some of Detroit’s other cultural institutions.

Though, as the story points out, “sold off” may not be the right term. Residents may have images in their head of pieces of the city being loaded up in moving trucks (or cartoony railroad zoo cars as the case may be), but privatization might be more useful (and necessary) for the city’s future:

Orr’s spokesman Bill Nowling said Friday afternoon that putting price tags on artwork, giraffes or real estate doesn’t mean those assets actually will be sold. It means that Orr and his team need to have a full picture of the city’s valuables and operations so that they can discuss the financial status rationally when meetings with creditors begin this week.

“We’re looking at every function and every asset of the city to see how it provides value to the citizens of Detroit and ask the question, is there a better operational model that will allow it to provide more value through less cost or more revenue?” Nowling said.

It’s important to note that selling individual assets won’t help much if Orr cannot bring city revenues and city expenses into line. If city spending continues to outstrip revenues from taxes and other sources, selling DIA artwork — or zebras — merely would put off the day of reckoning for a few more months or years.

“Those are onetime fixes, and really, as part of the restructuring process we’re not interested in those as much,” Nowling said. “They don’t provide the long-term stability that you want in your city’s finances and the level of quality of services that are provided to residents.”

A privatization expert quoted in the story suggests that the Detroit Zoo might not be a good potential revenue generator for the city even in private hands. While he may be correct in the context of the billions of debt and obligations Detroit owes, it’s still likely a better choice. Reason TV reported in March how Tulsa, Okla, saw an increase in attendance and quality at their zoo once it was handed over to a private nonprofit to operate. Watch below:

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  • Sevo||

    WIH is a city doing owning "billions of dollars worth of art"?

  • Rich||

    Silly Sevo. That's the graffiti.

  • UnCivilServant||

    There is precedent

    So it's not as much snark as you'd think.

  • thom||

    Uh...they own an art museum?

    I have to assume they got all the art the same way other big-old-city museums seem to have gotten it: through donations from the fantastically rich people who lived there in better days.

  • Sevo||

    Pretty sure in SF, the museums are separate from the city gov't; non-profits. I don't think (?) the city owns the art.

  • Fist of Etiquette||

    Giraffe meat? Everything tastes like chicken but the neck.

  • playa manhattan||

    What does the neck taste like?

  • Fist of Etiquette||

    Victory.

  • JW||

    You dumb ass. Everyone knows the blue tongue is the tastiest part.

  • Brett L||

    The wimmenz seem to love it.

  • John||

    Detroit just sixty short years ago was the second richest city in America and the greatest industrial city the world had ever seen. It was also becoming the most infested with Progtard policies. Name any idiotic idea that came from the left in the last 70 years and it got tried in Detroit. So, how is that working out?

  • UnCivilServant||

    Like a Malthusian dream. Look at all the space!

  • anon||

    Detroit just sixty short years ago was the second richest city in America and the greatest industrial city the world had ever seen.

    So what you're saying is that progressivism is cancer?

    I'm pickin' up what you're throwin' down.

  • Dr. Frankenstein||

    I blame Nixon. More accurately I'm blaminig the fact that the US dollar is the reserve currency of the world.

  • kinnath||

    It doesn't help when the world's industrial leaders miss fundamental changes in their market and let competitors pull the rug out from under them.

  • anon||

    It doesn't help when the world's industrial leaders miss fundamental changes in their market and let competitors pull the rug out from under them.

    I'll always blame those regulating economic behavior before I blame people trying to make money.

  • John||

    That is not true. First, the leaders didn't miss fundemental changes. They really were unlucky. No one saw the oil crisis coming. The Japanese sure didn't. Detroit did exactly what they should have been doing in the 1960s, making cars people wanted.

    Beyond that, the biggest reasons their quality went down was they were forced to put smog control technology that wasn't ready for wide use on their cars that destroyed the horse power and reliability of motors for 25 years. It really wasn't until the late 90s when thanks to computer controlled engines that horse power returned to cars. And second, they were saddled with one of the worst unions in human history. And why were they saddled with said union? Because the law made them saddled with it.

    The car industry is still big in America. America still makes lots of cars. They are just made in the South and not in Detroit anymore. Why couldn't Toyota or BMW have built plants in Detroit? All of the skilled labor was there. Why not? Because the liberal policies made it impossible to run a successful car company there, that is why.

  • anon||

    So basically a verbose version of what I said.

  • John||

    More or less. The thing is no matter how incompetent you believe the Big 3 are and were, so what? Detroit was a great place to build cars. It had the most skilled labor to do so. Other companies should have moved in to replace the Big 3 in Detroit. But none did.

  • BakedPenguin||

    If the unions were only greedy, I don't think they would be in the trouble they are in. If they had only demanded big money, but been flexible on the work rules, I really believe Detroit would still be viable.

  • John||

    And the other problem was it was one union representing workers to all the automakers. Time and again, workers of one company were willing to make concessions to ensure their employers stayed viable only to have their union bosses drive a hard line for fear of setting a bad precedent. The UAW basically ran Packard and Studabaker out of business by refusing to make any concessions even though the companies were going broke. It prevented anyone from innovating. So all of the really revolutionary quality management techniques that were developed in America ended up being used by the Japanese.

  • kinnath||

    The three biggest problems facing the Big 3 back then were: 1) The government 2) The union 3) Themselves.

    There were massive problems at the Big 3 in the executive offices and engineering. They didn't have to build shit cars for two decades after the oil crisis.

    It can't all be blamed on the federal government and the UAW.

  • John||

    I would disagree. The biggest difference between Japan and Detroit in the 1970s was Japan took to heart and adopted the real revolution in industrial quality management started by people like John Deming. Detroit did not. Now, it is true that the management at the Big 3 were often too pig headed and stupid to change their ways. But at the same time, even if they had been far sighted enough to adopt the new methods, no way in hell would the UAW have agreed to let them. And beyond that, the intransigence of the UAW is one of the things that created such a culture of complacency in the first place. Of course management didn't think of new ways to do things. It was unlikely any of those new ways would get UAW approval. So why bother?

  • kinnath||

    The biggest difference between Japan and Detroit in the 1970s was Japan took to heart and adopted the real revolution in industrial quality management started by people like John Deming

    This is the fault of the executive management, design engineering, and production engineering. That's for making my case.

  • John||

    Read the rest of the post. Why were they bad? Because the Union made it pointless to try to improve. Please understand my case before dismissing it.

  • kinnath||

    American unions certainly resisted TQMS-like systems well into the 90's (including the place I work now). American auto executives waited two fucking decades, until the Japanese were eating their lunches, to even try to put quality management systems into place.

    Ford started the "quality is job one campaign" in the 80's, but quality continued to be shit well into the 90s.

    I had a 88 mustang that literally stopped running in the early 90's with less that 90K miles on it. The dealer estimated that the cost to rebuild the engine was as high as the book value of the car. I asked the dealer what happened. He sighed, then said "It's a Ford from the late 80s. It just got tired."

    This is design failure, not manufacturing failure. You can't blame shitty design on the union.

  • kinnath||

    American unions certainly resisted TQMS-like systems well into the 90's (including the place I work now). American auto executives waited two fucking decades, until the Japanese were eating their lunches, to even try to put quality management systems into place.

    Ford started the "quality is job one campaign" in the 80's, but quality continued to be shit well into the 90s.

    I had a 88 mustang that literally stopped running in the early 90's with less that 90K miles on it. The dealer estimated that the cost to rebuild the engine was as high as the book value of the car. I asked the dealer what happened. He sighed, then said "It's a Ford from the late 80s. It just got tired."

    This is design failure, not manufacturing failure. You can't blame shitty design on the union.

  • Michael||

    Was the UAW somehow responsible for Ricardo Montalban peddling the soft Corinthian leather in a clapped out Cordoba that no one in their right mind would buy during that decade? Come on, John. Those were completely bone headed marketing and product development decisions that came from the top, and trying to somehow pin it to the union for stifling innovation is a bit of a stretch.

  • John||

    Was the UAW somehow responsible for Ricardo Montalban peddling the soft Corinthian leather in a clapped out Cordoba that no one in their right mind would buy during that decade?

    Yes. The reason why no one would buy it is because the build quality and reliability were bad. And why was that? Because union rules ensured as much.

  • kinnath||

    First, let's clarify that I deeply hate the UAW. But you give them way to much credit for just how fucked up American cars were during that time frame. The UAW was responsible for truly shitty manufacturing which produces all sorts of detectable flaws. But the long term reliability of the auto is driven by engineering, not manufacturing. So the Big 3 produced cars that were plagued by manufacturing defects and failed both early and often because of design defects.

  • kinnath||

    By the way, when was the last time you saw a Zenith TV?

    Auto manufacturing was not the only industry left in the dirt by the Japanese, and then the Koreans.

  • John||

    TVs are not cars. TV manufacturing left the country entirely because of cheap labor overseas. Car manufacturing did not. The US still makes tons of cars. It is just that a lot of plants are owned by foreign companies.

    So I ask for the 4th time on this thread, who cares about the Big 3? Why didn't BMW and Toyota build plants in Detroit instead of where they did? The answer to that is because of the UAW and the laws in Michigan. So Detroit has no one to blame but themselves for being where they are. The Big three could have all three gone bankrupt and Detroit would still have been okay if they hadn't been progtopia.

  • kinnath||

    The cost to retrofit old plants exceeded the value of the plants. Sometimes it's easier to start over.

    Obviously, new plants were built where land was cheap, labor was cheap, and massive tax breaks were offered.

  • John||

    There is plenty of space in Detroit and its burbs. But only a nut would have tried to build a plant there in the 1980s. And that wasn't because of tax breaks, which Michigan could have given just as easily as any other state.

    Really Kenneth, do you honestly think that Detroit died because of evil incompetent auto execs and not because of rampant unionism and insane prog policies?

  • kinnath||

    Detroit died because they continued to sucked the life out of companies that were already dying because they were lead by evil incompetent auto execs and staffed by unions thugs.

    Clear enough?

  • kinnath||

    The Big 3 got sick because they produced bad products that cost more than the competitor's good products. Cost was driven by the UAW, by federal regulation, and by Detroit. So GM moved production to Canada, and Ford moved production to Mexico. No other business run by sane executives would move into that environment.

    So yes, all the parasites infecting the host contributed to the demise of the host.

  • Michael||

    By the way, when was the last time you saw a Zenith TV?

    I wanted to reply earlier but had to dend to some more urgent matters. Here's a somewhat funny anecdote for anybody still following this thread.

    My uncle briefly worked as an engineer at the Zenith facility in a western suburb of Chicago. He would often regale us with tales of how completely backward the whole place was. When LG bought stake in the firm in the nineties, upper management gave some LG executives a tour of the facility. My uncle said that when the tour came around to his department where engineers were hunched over drafting tables drawing up designs for CRT televisions, the Koreans looked absolutely shell shocked. The only message that could be interpreted from their expressions was, "what the fuck did we just pay money for?"

  • Greg F||

    I had a cousin that worked for GM in the 80's. Back then the employees were allowed to buy 1 car a year at a pretty good discount. My cousin said that everyone that bought a car would walk the car through the assembly line to insure it was put together correctly. The employees didn't have a lot of confidence in the quality of work from their fellow workers.

  • Sevo||

    "It can't all be blamed on the federal government and the UAW."

    Agreed. The big 3 simply did not believe that there would be foreign competition, and handed out the candy like the good times would never end.
    I think that lesson's been learned. See, oh, Google and the stuff they hand out. None of it is guaranteed in contract form.
    The difference between the management and the union then became the unions' intransigence; nope, no way are we going to cut the benes! We'd rather have no jobs!

  • PapayaSF||

    I grew up in the Detroit suburbs, and my Dad was in the auto industry. All the above points are true to some degree, but there was also a lot of arrogance in the Big Three's management. In the early '70s they just could not believe that many Americans would want to buy those dinky Japanese cars. How wrong they were.

    I remember a friend of a friend who bought a new Honda or Toyota circa '74, for about $2500. Five years later, due to inflation and the then-established quality of those cars, it was worth about as much used as it cost her new.

    Around 1988 I bought a friend's '78 Corolla for $1100. Once when it needed service, the mechanic said that those engines were so well made that they would go for 300,000 miles, and that later Toyota realized they didn't need to be that good and reduced the quality. I sold it about 10 years later for $500.

  • kinnath||

    but there was also a lot of arrogance in the Big Three's management.

    There isn't much point in arguing whether Detroit was a liberal hellhole or the UAW were overpaid hacks, when the people running the business have no idea what the market wants, the business is doomed.

  • PapayaSF||

    I still blame the unions more than management, because it's not impossible for management to change (either decisions or personnel), but Wagner Act unionism is a resistant force like few others.

  • JW||

    Detroit is teetering on the brink of the largest municipal bankruptcy in American history. The city’s emergency manager, Kevyn Orr, and his team have said they want to evaluate everything owned by the city as they begin negotiations with creditors in the face of $15 billion to $17 billion in debt and future pension obligations.

    If this would only happen in more cities.

  • anon||

    But it only happened in Detroit because the right people weren't in power. If we just had the right Top Men in charge everything would be fine!

    /sic

  • John||

    It was just bad luck. Those poor progtards always seem to take power right before things go to hell. It is amazing how unlucky they are.

  • UnCivilServant||

    Or there's a statistically significant correlation that's far stronger than the link between videogames and random shootings.

  • John||

    Never. They mean well. And things would have been really bad in Detroit if they hadn't been charge.

  • anon||

    You think it's bad now, just imagine if BOOOSH were in power!

  • anon||

    Those poor progtards always seem to take power right before things go to hell.

    I know this is a joke, but it really makes me laugh every time. It reminds me of the customers I frequently run into that don't understand why they always have car problems after they refuse every piece of service work recommended to them.

  • sarcasmic||

    It's not their fault that Rethuglicans left so bad of a mess that well intentioned liberals just couldn't clean it all up! I mean, look at Obama! He's still cleaning up after the mess left behind by the Booshes and Reagan!

  • AlmightyJB||

    Coming to a country near you.

  • AlmightyJB||

    This is happening becausd Barak Obama doesn't care about black people.

  • AlmightyJB||

    Also, Detroit needs to spend more. No more austerity!

  • anon||

    Duh. It's those Rethuglicans in congress cutting (insert bullshit here) that's forcing Detroit to be a shithole. Even though Detroit probably received billions in stimulus cash.

    /sic

  • creech||

    Hey what do upper middle class outsiders know about the problems of Detroit? Unless, of course, they are Top.Men. who advised the other craphole cities of this country.

  • ||

    "Looking to buy a giraffe?"

    Of course! What kind of question is that?

  • Pro Libertate||

    How much for the Robocop statue?

  • anon||

    dude

    is that real?

    Cause if so I want one.

  • Pro Libertate||

    It's real.

  • PRX||

    Robocop belongs in his home, Dallas.

  • Moz||

    There are private nonprofits in place that manage the Detroit Art Institute and the Detroit Zoo. Both do a very good job managing their respective institutions and don't get any money from the city (although they do have dedicated tax millages from the three counties that make up Metro Detroit.) The problem is, however, that the city still owns the assets.

    What's interesting is that the assets like giraffes and Van Goghs could only be sold by the emergency manager, as a Chapter 9 bankruptcy can't force a municipality to liquidate assets the way a Chapter 11 can do with a business. By law, his term only lasts 18 months and any attempt to sell these assets is going to end up the chewtoy for every millionaire's lawyer in town, who will drag the cases out beyond the sunset of the emergency manager's authority.

    This was, at the end of the day, a "Look, assholes, I'm serious!" PR move by the emergency manager so that when he does get around to cleaning up the city's balance sheet by transferring the city water department to a regional authority and other such things he can also show that he did due diligence with assets appreciated by rich white people as well.

  • DRM||

    I note that the Detroit Zoo isn't in Detroit; it's in Royal Oak. Similarly, most of the Water Department's customers don't live in the city limits. And DIA financing has been paid for by the tri-county area as a whole for quite a while now.

    Detroit, however, has grimly held on to ownership of all of these in the name of prestige. Any efforts to either privatize or regionalize any Detroit assets will be fought bitterly.

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