HALF OF Detroit’s $18 billion debt is owed in pensions and health benefits to its 20,000 retirees.
The demise of Detroit is just a heartbeat away for most public officials.
Many of its current policies spelled doom. Trouble is, nobody bothered to read the handwriting on the wall.
So what can we here in Iola take from the Motown’s meltdown?
For the past 40 years, Detroit’s inner city was neglected. Attention and special deals were given to big box stores to build on its outskirts, forcing the mom-and-pops to close.
To a much smaller degree we’ve witnessed that here. Walmart — almost two miles from Iola’s downtown — has all but robbed our square of a majority of retailers. Yes, it’s a pretty good team player, as far as Walmarts go, but it’s forced the closure of all of our independent grocery stores, an electronics store, two hardware stores and a shoe store, all in the past 10 years.
The lesson learned is not that we necessarily say no to Walmart or Orschelns, but that any and all entities that want to build in Iola should be given every advantage possible.
And that as a community, we need to realize that we each butter the other’s bread. Tim and Teresa Henry’s success at Twin Motors is reflected in a new pair of Justin boots at Glen Coffield’s Town & Country Western Wear. When Valentine’s Day comes ’round and you’ve bought your sweetie a bouquet of roses, you can be sure Duane and Judy McGraw feel able to dine at Corleone’s.
Detroit was a one-pony show. It knew only automobiles and when globalization came into full effect it lost out to more nimble competitors and economies.
When Iola lost Pet Milk and LeHigh Portland Cement years ago, city leaders worked tirelessly to recruit new business. They were rewarded with Russell Stover Candies, Gates Rubber and Berg Manufacturing locating here. Berg sold to Haldex years later.
Since the closing of Haldex two years ago Iola Industries is at it again trying to find a replacement for the large manufacturer.
As a region, we need to continue to diversify our manufacturing base
On this point, Kansas has no room to speak.
Today, the Kansas Public Employees Retirement System (KPERS) has $10 billion in unfunded liabilities. Yes, we’re getting on the right track with increased contributions from both employers and employees, but the increases are modest and will take a long time to get the system on solid footing.
For the past 17-plus years the Kansas Legislature was negligent in its responsibility to adequately fund the retirement program, allowing decreases in contributions alongside increases in benefits.
Kansas educators, firemen, policemen and other public officials as well as their employers are now paying the price of such mismanagement with significantly higher contributions and fewer benefits.
Kansas taxpayers as a whole also are paying into the retirement system as proceeds from gaming revenues are funneled its way.
Another casualty of the mismanagement will be a decline in good candidates who will seek better paying jobs elsewhere.
The biggest casualty in Detroit is the trust between its people and city and state leaders. If their pensions and benefits are allowed to help satisfy the debts caused by the ineptitude of city leaders, it will break the spirit of a people who have little else left but their hard-earned dignity in their service to others.
Kansas should be on the alert.
Detroit is by no means unique.
— Susan Lynn