Kildee: Michigan Austerity Policies Doomed Flint

(Photo: AP/Manuel Balce Ceneta)

Representative Daniel Kildee of Michigan speaks to reporters about the Flint, Michigan, lead poisoning during a news conference on Capitol Hill on Wednesday, April 20.

The contaminated-water crisis in Flint, Michigan, has propelled the city from a public relations disaster to municipal freefall. As President Obama prepared to travel next week to a city where residents still don’t trust their tap water, Michigan Attorney General Bill Schuette filed criminal charges against two state officials and one city employee who monitored Flint’s water supply. 

Meanwhile, despite a national uproar and a declared public health emergency, Congress has been slow to provide emergency aid to the poor and predominately African American city. This week, one of the city’s most outspoken leaders, U.S. Representative Dan Kildee, the Democrat who represents Michigan’s Fifth District, once again called on Congress to come up with a federal aid package.

The two-term congressman has placed the blame squarely on Republicans’ anti-government ideology. The city’s crisis is the direct result of an obsession with austerity as the solution to a financial problem,” he declared earlier this month. Born and raised in Flint, Kildee noted that like many older, distressed American communities, the former General Motors company town never charted a way forward after the decline of manufacturing. Unprepared for the new, unforgiving world of a high-tech, knowledge-based economy, those places tumbled into deeper financial distress. 

But Kildee argues that state and local policymakers who insist on spreadsheet-driven recovery strategies are the least equipped to turn around these communities. (Even Fitch Ratings recognized that, in the case of Flint, “emergency manager activities can also have unanticipated consequences.”)

“We hear it as part of national conversation, this worship of the notion that austerity as a principle is something to be pursued,” Kildee said. “It literally changes the notion of what it takes to live in a civil society.” 

The congressman delivered his remarks at the Lincoln Institute of Land Policy’s 2016 Journalists Forum on Municipal Fiscal Health in Washington, D.C. Asked to rate Republican Governor Rich Snyder’s response to the crisis so far, Kildee described it as somewhere between “absurd and pathetic.”

What follows is an edited transcript of his comments.


U.S. Representative Dan Kildee: There are a lot of Flint, Michigans in this country, more than than most of us want to admit. 

In 1908, GM was founded. We had a pretty good run. In the 1930s, the Flint workers occupied the factories and helped get the first United Auto Workers-General Motors contract. That helped set the stage to build a really strong middle class, not just in Flint and the region, but throughout the United States. It was part of that basic bargain, where workers enjoy a fair share of the productive capacity that they contribute to. 

But things changed. Globalization, changes in the economy, and technology basically undermined the economy. There were other factors, too—racial avoidance, people leaving the city. 

Twice in the last decade, the city went into receivership and was taken over by the state of Michigan. We never imagined that the consequence of this mismatch of policy with the needs of these older communities would result in the kind of crisis that we see in Flint right now. There was only one tool— and this is the heart of the problem: the ability to cut costs. Not to bring new investment, not to assist the city with its path forward in any substantial way, but simply to deal with the balance sheet.

Measuring the quality of a community by looking at its annual financial report is a huge mistake. Cities are not municipal corporations. Municipal corporations are formed to provide services to cities. But cities are communities of people. They are social organisms. They live on, well beyond the limited role that its government plays.  

The emergency manager in Flint made a whole series of choices to cut costs, to get that city into balance, or at least, to get its ledger in balance. One of the decisions was to temporarily move away from the use of the Great Lakes. Lake Huron is our primary drinking-water source, and we use the Flint River.

The problem was this: It costs money to properly treat the water and that was money that was not in the budget. This city had highly corrosive water running through its system, leeching lead into the drinking water going into the bodies of 100,000 people.

By the measures that these emergency managers in our state are evaluated, that was very successful. They got the ledger in order. They returned the city to some form of municipal fiscal solvency. But it was a decision, aligned with the belief that the balance sheet comes first, that led to a community that has had its children, 9,000 children under the age of 6, poisoned by levels of lead that are way, way above the federal action levels.

The community made its own mistakes by not thinking way ahead and beginning to diversify its economy when it had the economic strength to do that. How can Flint be a place that’s attractive when not only has it been going through all the big problems that it has faced, but it’s a community that can’t deliver drinking water? 

There is a mythology about these older cities, that it is corruption or mismanagement that has led to their decline. Very often there are drivers that go well beyond the control of those individuals in charge. We have a system of municipal finance, at least in my state, and, in some other states, that is completely inadequate to deal with the needs of these places.

If we acknowledge that it is in our national, state, and regional interests to have cities like Flint succeed, why do we ask these cities, or tell them, that it is entirely up to them to right themselves? It can’t be done. Even if we can’t think about it in moral terms, there is a cost associated with this neglect of older communities that are having a difficult time finding their way from the old to the new economy.  

Flint is an extreme example: In the short term, decisions were made to balance the books by a measure that a venture capitalist uses when thinking about acquiring and selling or dismantling companies. You can’t apply those same principles in a community that has to go on. You cannot sell off a town. You can bankrupt its municipal corporation, but you cannot disassemble a community.

What does that say to my community, if an entire generation of kids has their brain development affected by this neurotoxin? Whether the federal and state governments come together to make it right for Flint or not, there is a huge cost that will be borne by our criminal justice system, education system, and social-service networks. This is the cost of this obsession with austerity that says that the balance sheet is the ultimate measure of the success of a community—the lack of $140 a day, which is what it would have cost to treat the water with corrosion-control agent—less than $50,000 for an entire year.

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