There's Been a Dictatorial Coup -- Koch Bros. Have a Bunch of Czars Running Cities Across Michigan

By Jim Hightower/ AlterNet

Here's a political storyline that might seem familiar to you: With economic pain and political discord ripping across the land, he appeared to have the ideal resume to become the Republican contender for the top job. Not just another career politico from the dysfunctional Congress, he was a son of heartland Michigan who had founded his own venture capital firm. He looked like the image-perfect "job creator," and he'd achieved notable financial success in the no-nonsense corporate world. That success, he figured, would now catapult him to electoral victory, for it demonstrates that he's a can-do fellow with the know-how to run government like a business and fix the economy.

Mitt Romney? Yes, but before him, Rick Snyder [3] played the lead role in this made-for-TV political drama--and it hasn't worked out well at all for the people of Michigan. Two years ago, this former corporate chieftain and founder of two venture capital outfits stepped into Michigan's political arena, snatching the GOP gubernatorial nomination from the grasp of a congressman, the state attorney general, and a couple of other experienced pols. The times were right for a Mr. Fix-it--with Michigan's key auto industry in the ditch and middle-class wages decimated, working families were struggling, poverty was on the rise, and whole cities were on the brink of broke.

Backed by bales of corporate cash, Snyder won the general election by ceaselessly running a series of "job creator" ads (never mind that he had been a top executive and director of a computer corporation that relentlessly shipped thousands of American jobs out of the country until 2007, when the corporation itself was shipped to Taiwanese owners). Snyder said he had a plan to "reinvent Michigan," the essence of which he expressed in one of his campaign ads [4]: "Eliminate Michigan business tax. Cut taxes on job creators $1.5 billion. Slash needless regulations. Help small business."

That's not a plan, it's a scam--essentially the same ol' Republican same ol', now being regurgitated by the Romney-Ryan duo. However, Michiganders were desperate enough for a way out of the state's economic doldrums that 58 percent of voters cast their ballots that November for the "Businessman with a Plan."

What they didn't know--because the campaign never hinted at it, much less spoke of it out loud--was that a cabal of corporate-funded, far-right extremists behind Snyder would soon spring a secret plan on them. It was to be a horrific "Spring Surprise" that literally would reinvent Michigan--along with negating the very idea that the American people have a democratic right to be self-governing.

Michigan goes berserk
One of our nation's finest political satirists, cartoonist Garry Trudeau, has created a buffoonish character named Trff Bmzklfrpz [5] for his "Doonesbury" comic strip. A caricature of despotic thugs everywhere, Bmzklfrpz is presented by Trudeau as the ruler of the aptly named Greater Berzerkistan.

Rick Snyder must've studied there, for he had barely taken his oath of office before suddenly teaming with leaders of the Republican-controlled statehouse and senate to ram into law an astonishing measure of despotic rule. It only took two weeks in March of 2011 for the ponderously titled "Local Government and School District Fiscal Accountability Act" [6] to be rushed through both houses of the legislature and signed by Snyder. Before the public knew it--BAM! --the governor was authorized to establish his own autocratic republic: Michiganistan.

At bottom, the LGSDFA Act is a doozy of autocratic mischief-making. It lets the governor seize control of any local government he deems to be in fiscal trouble, suspend the people's democratic authority, impose a corporatized version of martial law, and install his own "emergency financial manager" to govern by diktat (like some hybrid of Soviet czar and tinhorn potentate--a Bmzklfrpz, in other words).

The official rationale is that many Michigan cities and school districts are in dire financial straits, requiring extraordinary intervention to "save" them from their own people and elected officials. "It's about helping communities," Snyder dissembled [7], as he began installing EFMs.

Helping? This is the kind of "help" a fox brings to the henhouse:

Emergency managers begin by usurping the power of all elected officials or simply "firing" them.
They can then rewrite the public budget without any public participation, unilaterally eliminate various services, cancel contracts, seize and sell off public assets, privatize government functions, and dictate new laws.
They can even dissolve a city's charter.
This isn't merely un-democratic--it's aggressively anti-democratic.

Yes, there are some severe fiscal messes in Michigan's local governments, but the big debts that have piled up are not caused by too much democracy, bloated bureaucracies, or reckless spending by hometown officials. That's just mendacious political claptrap spewed by those wanting an excuse to impose their anti-union, government-shriveling, privatizing, partisan agenda on vulnerable people. It's no accident that the cities presently under state siege (including Benton Harbor, Detroit, Flint, and Pontiac) are heavily populated with low-income, union, African American, Democratic-voting households. While it's true that these places are in deep budgetary holes, there are real reasons for their fiscal woes, including:

The implosion of the auto industry that's central to these local economies, resulting in massive joblessness and drastically downsized family incomes.
The tanking of housing values, destroying the one source of wealth that working people had, creating a sudden plummeting of property tax collections that finance schools and city services.
The grim (and largely successful) corporate campaign to crush unions and bust middle-class wages.
US trade policies and tax subsidies that encouraged Michigan corporations to move manufacturing offshore, eliminating good jobs and forcing a large number of former taxpayers to leave their cities in search of work.
Oh, let's not forget another major cause that Snyder & Company don't want discussed: His $1 billion cut in corporate taxes [8]. This increased the state's budget hole, which he helped fill by slashing or eliminating state funds and tax credits that went to local school districts, low-income workers, and seniors.

The LGSDFA coup against local democracy does absolutely nothing to address--much less fix--these actual causes of the financial crises that mayors and other elected officials face. And by the way, since when did self-styled, small-government "conservatives" become such gleeful champions of using centralized governmental power to whack the once-hallowed Republican tenet of local control? Indeed, to see the irony of their governor trampling their democratic rights, Michigan citizens need look no further than the website of the state Republican Party. Right up front, it proudly posts a list of nine inviolate GOP principles [9], including this gem: "The most effective, responsible, and responsive government is government closest to the people."

Spawn of the Kochs
While corporate plutocrats rant about out-of-control government regulators, they do not really hate big, invasive, authoritarian government--as long as they can own it and use it for their own needs. This is why such multibillionaire corporatists as Charles and David Koch have been pumping truckloads of money into dozens of front groups like the Mackinac Center for Public Policy in Michigan [10]. Set up 25 years ago and linked to a network of Koch-headed centers in nearly every state, Mackinac is an idea factory and advocate for shrinking people power and enhancing corporate control.

While it refuses to name its super-wealthy individual backers on the absurd grounds that disclosure "would be a tremendous diversion," the Center does have to report donations from "charitable funds," which includes money from a host of corporate foundations tied to the Koch brothers, Domino's Pizza, Amway, Coors, GM, ExxonMobil, JPMorgan Chase, and Walmart, among others.

In 2005, one of Mackinac's grand ideas was put forth in an essay [11] written by a privatizing enthusiast named Louis Schimmel, who was the Center's director of municipal finance. Noting that Michigan already had a limited program for sending state managers to aid cities engulfed in a fiscal crisis, he argued that the law should be radically expanded to create an emergency financial manager with autocratic power to take control of Detroit's troubled budget. Specifically, Schimmel's Mackinac proposal called for four fundamental changes: (1) the financial overseer would "replace and take on the powers of the governing body"; (2) have sole discretion to alter the governing charter; (3) be immune from lawsuits; and (4) have the power to alter and ultimately abolish union contracts.

After Snyder won and the GOP gained big majorities in both legislative chambers in November 2010, the Mackinac Center moved quickly to reprint and circulate Schimmel's paper. Lo and behold [12], the governor's LGSDFA proposal, which seemed to come out of the blue three months later, actually came out of the Koch boys' Mackinac machine. Snyder's bill included all four of Schimmel's democracy-usurping components, as well as other authoritarian add-ons presumably drafted by the Center.

With a solid, lock-step majority in both the state senate and house, Snyder and Republican legislative leaders were able to railroad [12] the full extremist pack-age into law. The GOP slapped down even the most token gestures to local governance--for example, a little amendment that merely would've required EFMs to hold monthly public meetings--so locals could be told what changes their czar was making-- got crushed in the senate.

Respect the rule of law? Ha! For half a century, Michigan has had a constitutional rule that a new law doesn't take effect until 90 days after the legislative session ends--thus giving affected citizens time to adjust or try to repeal it. By a two-thirds vote in each house, however, a law can be declared an emergency and allowed to take effect immediately.

With a supermajority in the senate, GOP members easily rushed their EFM measure into effect, but in the house, the party is 10 votes short of the necessary two-thirds tally. No problem--they simply cheated by pulling a quick count and lying about the result. The presiding officer of the house barked out the following in one breathless, three-second sentence: "Themajorityleaderhasrequestedimmediateeffect AllthoseinfavorpleaseriseImmediateeffectisordered."

We're to believe that in only three seconds, he called for a vote, the members got to their feet, he was able to count two-thirds of them standing in favor, and he gaveled the law into effect. Magical!

Plutocrats in action
Let's go to Pontiac, a once proud city boasting that one of America's iconic cars was named after it and made there, employing 23,000 auto workers in the General Motors factory. Today, though, those jobs have been moved out-of-state or eliminated, the Pontiac brand itself has been jettisoned by GM, the city's population has dropped, property values have plummeted, and the city government has been left in a fiscal wreck. To add to its miseries, Gov. Snyder's cutbacks in revenue sharing mean that Pontiac's funds have been slashed by a third.

The governor did give something to the people of Pontiac, though: An emergency manager [12]. Appointed last September for an indefinite period (he's still there), he promptly relieved the city council of their powers and salaries. Then he fired the city attorney, clerk, and director of public works before acting on his own to outsource the work of various departments. Next, he offered up about half of the people's property in a fire sale of assets--including city hall, police and fire stations, the library, water-pumping stations, a golf course, and two cemeteries. More recently, he has issued five edicts undermining contracts with union workers and retirees.

Who is this guy? Louis Schimmel, the privatizer man from Mackinac!

Asked last year if the EFM law made him a dictator, Schimmel conceded with a sigh [13]: "I guess I'm the tyrant in Pontiac."

On to Benton Harbor, the home of Whirlpool Corporation and once the major producer of that giant's appliances. Whirlpool's executives, market analysts, and other top-paid employees still are based in Benton Harbor, ensconced in the corporation's brand-new, gleaming, tax-subsidized $68 million corporate campus in this town on the shores of Lake Michigan. But, beginning in the 1980s, the bosses have steadily emptied out all of their local factories, moving Benton Harbor's manufacturing jobs abroad to cut labor costs.

This has decimated the local economy, cutting the town's 20,000 population in half, destroying its tax base, and leaving it with chronic unemployment. Benton Harbor is now the poorest city in Michigan, with a per capita income of about $10,000.

The town's major asset, a public park overlooking the lake, is being absorbed into "Harbor Shores," a $500 million Whirlpool-backed resort project that includes a sprawling, Jack Nicklaus-designed golf course. Of course, impoverished locals can't live or golf there, but the developers (who got government subsidies for the project) are hoping that Chicago weekenders will make the two-hour trek to the place.

These people are losing their park, but worse, a fellow named Joe Harris [14]has taken a more valuable asset from them: Their democracy.

Harris is Snyder's EFM and literally the Dictator of Benton Harbor. A former Detroit auditor, he began by summarily stripping all power from elected officials, decreeing that city commissioners can meet, but the only action they can take is to approve minutes of their last meeting and then adjourn. When commissioners made a mild (but clever) protest by proclaiming this past spring that the city would observe Constitution Week, Harris monocratically nullified their action. What perfect symbolism! He then expressed surprise [7] that this had upset townspeople: "All I told them was, 'Hey, guys, you have no authority.'"

With unfettered control, Harris has kicked elected officials out of their city hall offices, fired the city manager and other administrators, dismissed the planning commission and installed his own loyalists, merged the police and fire departments, and sold the com-munity's public radio station (which had criticized him). He also intends to privatize the water system (after raising residents' water rates by up to 40 percent) and has jacked up annual garbage fees by about $300 per home.

Harris is proud and happy to be a commissar for the Koch-Mackinac vision of a privatized America with a neutered democracy, and he definitely likes being in charge with no fussy checks and balances on his decisions: "I don't have to worry about whether the politicians or union leaders like what I'm doing. I love this job. I am the mayor and the commission, and I don't need them."

Meanwhile, Benton Harbor is still deep in debt--and absolutely nothing has been done to address its real problems of joblessness, poverty, inadequate education, inequality, and civic depression. As for an actual plan to boost the economy, Harris points excitedly to his idea of economic development: Selling "I <3 and="and" benton="benton" bumperstickers="bumperstickers" harbor="harbor" p="p" souvenirs="souvenirs" t-shirts="t-shirts" to="to" tourists.="tourists.">
Rebellion
City after city in Michigan--including Flint, Highland Park, and even Detroit--are presently under assault by this mind-numbing, right-wing, ideological stupidity. Dangerous stupidity--Detroit Mayor Dave Bing had to surrender control of his city's finances this year to a Snyder austerity czar, who has sought to increase the number of students in each classroom to 61, and the czar's budget cuts are so severe that the fire chief says if empty buildings catch fire, he'd have to let them burn down.

Is this America? It no longer will be if these social-engineering autocrats prevail. But, good news: Michiganders are in full rebellion! As always, though, battling the bastards is never easy, because... well, they're bastards. And they're very well-funded. And sneaky. Yet the people keep pushing, as we see in this chronicle of the 2012 Michigan Rebellion:

Feb. 29--A broad grassroots coalition (ranging from union workers to tea party members) that was organized under the umbrella of "Michigan Forward" filed more than enough citizen petitions to put the repeal of Snyder's EFM nonsense on the ballot for this November's election.
April 19--At the last minute, just before the repeal question would have been certified for the ballot by the state board of canvassers, a complaint by Citizens for Fiscal Responsibility is filed to stop certification. Reason? "The font size of the [petition's] heading" is claimed to be too small to comply with state law. Font size!
April 9-25--Legal jockeying takes place, and digging by journalists and coalition members reveals that (1) CFR is not a real group, but a creature of the Sterling Corporation, a GOP political consulting firm--same address, phone number, and staff; and (2) a Sterling partner, Jeff Timmer, was a chief executive of the Michigan Republican Party and now happens to be one of the four voting members of the state board of canvassers. There are widespread calls for Timmer to recuse himself from the board's petition decision, but the secretary of state (a Republican) says no one can force him to do that.
April 26--Decision day for the board. Timmer does not withdraw, so the board deadlocks two-to-two, which kills the repeal referendum.
June 18--Timmer resigns from the board.
June 29--Citizens coalition appeals the board's rejection to Michigan's Supreme Court.
Aug. 3--In a four-to-three decision, the court majority (including one Republican) rules that the font size does not disqualify the petition, so the board must put the repeal question on the ballot.
This victory means that American democracy literally will be up for a vote in Michigan on Nov. 6! The Republican and Koch political networks are going all out to win--and if they do, your state/city could well be next on their Berzerkistan anti-democracy agenda.

Breaking: Secret emails revealed. Michigan right-wingers are not satisfied with attacking collective bargaining. They want to outlaw the union.

By Fred Klonsky/ Fred Klonsky/hat tip to @wavingcrosser for the link

Jack McHugh of the Mackinac Center sent secret emails to Michigan state rep Tom McMillan calling for the destruction of the Michigan teachers union.

There’s a solid line connecting the right-wing Mackinac Center, the loony Education Action Group and the Michigan GOP.

The Mackinac Center is allegedly non-partisan and has tax status preventing direct lobbying.

But emails released by  Dave Murray, education reporter for the Grand Rapids Press,tell the story.

“Our goal is (to) outlaw government collective bargaining in Michigan, which in practical terms means no more MEA,” wrote Jack McHugh, of the Mackinac Center for Public Policy, to state Rep. Thomas McMillin, R-Rochester Hills, the newly appointed head of the House Education Committee in a June 1 email.

McMillan is slated to replace recently recalled Paul Scott as head of the House Committee.

Doug Pratt of the Michigan Education Association told the Grand Rapids Press:

The emails show the center has “a corrupt corporate agenda” and an “undue influence” over some Republican lawmakers, who have pushed through changes in teacher tenure, pensions, health care and school funding.

“The Mackinac Center really is in favor of free markets, then why is it calling for some organizations to no longer be allowed to exist?” Pratt said. “The MEA has been around nearly 160 years, and the center’s leaders are trying to destroy and undermine us.”

Conservative think-tank FOIAs Michigan labor profs

By Kase Wickman

The Mackinac Center for Public Policy, a think tank backed by some big-name conservatives, has submitted a Freedom of Information Act request to professors at labor-centric schools, asking to see any emails containing certain key words, Talking Points Memo reports. The subjects mostly relate to the Wisconsin union protests: "Scott Walker," "Wisconsin," "Madison," and "any other emails dealing with the collective bargaining situation in Wisconsin." There's one other, outlying subject the think tank would like to see emails about — the FOIA request also seeks emails that mention "Maddow."

As in, MSNBC host Rachel Maddow.

"Some days my job is weirder than others," Maddow told TPM in response to her name being among the topics of interest to the Mackinac Center.

The FOIA requests were sent last Friday and Monday to the Labor Studies Center at the University of Michigan, the Douglas A. Fraser Center for Workplace Issues at Wayne State University, and Michigan State University, which has a School of Human Resources & Labor Relations. The requests were written to cover emails sent by all labor faculty from January 1, 2011, to March 25, 2011.

Roland Zullo, a professor at the University of Michigan, theorized to TPM that the Mackinac Center is trying to catch the professors using their taxpayer-salaried time to push their policy ideas and opinions.

"It sounds like they're trying to catch us advocating for the recall or the election of a politician," Zullo said. "Because we're not supposed to do that, we're not supposed to use our University of Michigan resources for something like that."

Though the Mackinac Center describes itself on its website as a "nonpartisan research and educational institute dedicated to improving the quality of life for all Michigan citizens by promoting sound solutions to state and local policy questions," the think tank casts a decidedly conservative shadow. The Mackinac Center is associated with the conservative Heritage Foundation, Mother Jones reports, and past donors include one of the Koch brothers, as well as the Prince Foundation, whose vice president is Blackwater founder Erik Prince.

iting their position as non-profit and non-partisan, the Center asked that the findings of their FOIA be provided free of charge.

"This is a way that they're going after folks they don't agree with, I suppose," Zullo told TPM. "I see it just simply as part of the political environment we exist in right now."

When TPM called Ken Braun, the managing editor of the Mackinac Center's newsletter, he declined to comment.

"I'm not going to release what we're writing about," he said.

Behind Michigan's "Financial Martial Law": Corporations and Right-Wing Billionaires

By Andy Kroll

Last week, Michigan's Republican Governor Rick Snyder signed into law a fiercely contested bill giving unelected "emergency financial managers" unprecedented power to shred union contracts, privatize city services, and consolidate or dissolve local governments, all in the name of saving struggling cities and school districts. Dubbed "financial martial law" by one approving state GOP lawmaker and "disaster capitalism" by critics, Snyder and his bill have become a target for Wisconsin-like protests. Several thousand demonstrators marched on the Michigan Capitol in the days before Snyder signed the bill. But gone unmentioned is a little-known Michigan think tank that for years has been pushing for the most controversial provisions in Snyder's bill—and that's bankrolled by some of the same right-wing millionaires and billionaires that backed Wisconsin Gov. Scott Walker and his anti-union legislation.

Since 2005, the Mackinac Center for Public Policy has urged reforms to Michigan law giving more power and protection to emergency financial managers, state-appointed officials who parachute into ailing cities or school districts and employ drastic measures to fix budgets on the brink of collapse. In January, the free-market-loving center published four recommendations, including granting emergency managers the power to override elected officials (such as a mayor or school board member) and toss out union contracts. All fourended up in Snyder's legislation.

"The Mackinac Center has been tied at the hip with the Republican Party establishment for years," says Doug Pratt, public affairs director at the Michigan Education Association. "It goes to their funding sources; it goes to their ideology."

Mackinac is part of a network of state-based groups associated with the Heritage Foundation, the influential right-wing think tank in Washington. Its past and present board members include Robert Teeter, a GOP strategist and '92 campaign manager for George H.W. Bush; Margaret Rieker, a former vice chairwoman of the Republican National Committee; and Joseph Lehman, a former vice president at the libertarian Cato Institute in Washington.

The Mackinac Center does not disclose its donors. But a review of tax records shows that the group's funders include the charitable foundations of the nation's largest corporations and a host of wealthy conservative and libertarian benefactors. Between 2002 and 2009, the Mackinac Center's donors included the Charles G. Koch Foundation ($69,151), founded by the chairman and CEO of Koch Industries, who, with his brother, David, is a major backer of conservative causes; the Dick and Betsy DeVos Foundation ($80,000), the charity tied to the son of the co-founder of Amway, the multibillion-dollar direct marketing company; the Edgar and Elsa Prince Foundation, established by the parents of Blackwater founder Erik Prince, who serves as the foundation's vice president ($195,000); and the Walton Family Foundation ($100,000), established by Wal-Mart founder Sam Walton and his wife, Helen.

Michael LaFaive, director of the Mackinac Center's fiscal policy initiative, says the Center is never influenced by its donors: "We are happy to take checks from people who don't agree with us, but they're not the ones sending us money."

Political action committees and non-profit groups linked to some of these same donors also helped fund Scott Walker's gubernatorial campaign and his push to eliminate collective bargaining rights for most public-sector unions. Koch Industries' PAC gave $43,000 to Walker's 2010 campaign, while Wal-Mart's PAC chipped in $15,000. Dick DeVos and his daughter, Elisabeth, also individually donated to Walker's campaign.

The Mackinac Center’s is a fervent advocate of privatization—its scholars support outsourcing everything from public school districts to Amtrak to state prisons—and backs anti-union legislation for Michigan. In 2007, the center published "A Collective Bargaining Primer," advocating against mandatory unionization and automatic dues deductions for public school teachers and other public employees. Collective bargaining for teachers, the Center claims, "has become a significant deterrent to educational quality." In other words, if you outsource as much as you can and kneecap the unions, the quality of education—and presumably city services—increases.

That position is in line with the beliefs of its donors. In 2009, Amway and Wal-Mart were among the 3,100 businesses that signed a letter opposing the Employee Free Choice Act (EFCA), which would've made it easier for employees to unionize; that same year, Wal-Mart spent $7.4 million on lobbying, much of it to defeat EFCA. (The law failed.) The Koch brothers, meanwhile, fund an array of organizations opposed to unions, including the advocacy group Americans for Prosperity, the Cato Institute, and the Reason Foundation. With the Mackinaw Center, it seems, their investment is paying off.