When an Unconstitutional Force Meets an Implacable Object

“If you want your dreams to come true, don’t sleep” – Yiddish proverb

The “irresistible force paradox” is often stated “what happens when an unstoppable force meets and immovable object?” (It is a paradox simply because there cannot be both and unstoppable force and immovable object; the existence of one negates the possibility of the other.) Such paradoxes are easily resolved when dealing with physical matters, the statement is self-contradictory and we need go no further. I suppose they are also rather easily resolved in politics as well, though the “laws of motion” aren’t as easily defined. Yet and still, there are certain “truths” that we just can’t get around.

A couple of days we commented on the Detroit bankruptcy filing, noting that the city simply had no options left an that eventually the promises to pay would go unfulfilled. Bankruptcy tends to be a more reasonable option to unwind the inability to carry on (versus say a “chaotic” unraveling in which the bankrupt entity simply stops functioning).

Naturally those who are owed money by the state wanted to stop the bankruptcy filing, demanding that they get their money at all costs. The sued to stop the bankruptcy and yesterday a judge sided with them, declaring the Detroit bankruptcy filing to be unconstitutional (meaning the state Constitution of Michigan).

What I find interesting is the reason the judge gave for declaring the filing unconstitutional. She indicated that “the Michigan Constitution prohibits actions that will lessen the pension benefits of public employees.” I haven’t read the Michigan Constitution, but I also find the response of the Attorney General interesting. Instead of balking that she  was crazy, he indicated that it wasn’t a foregone conclusion that the bankruptcy would indeed reduce benefits. It is all but a tacit admission by the AG that indeed a reduction of benefits is unconstitutional, or at least Constitutionally difficult.

I think this points out the problem of overconfidence in a Constitution, or laws in general. We have outlawed murder, rape, theft, and any number of ills – and yet they still occur. Making a law doesn’t make it so. I’m reminded again of all the efforts (by both left and right) to legislate that people behave morally … which have failed.

The Michigan Constitution may well dictate that the city cannot reduce benefits promised to the public workers (again, I don’t know for sure), but this doesn’t make it so. Eventually the money will run dry and they will get nothing … absolutely nothing. Perhaps they can force Detroit to sell all its assets before that time. Perhaps they can push themselves into the top position in the creditor hierarchy. Eventually though, everybody will get burned.

If the public pensioners can force themselves to the front of the line, it may only hasten the demise. It would mean the bondholders take their losses sooner. This would end the ability of Detroit to borrow more money (they’d lose access to the bond markets). The city would then have to pay the bills based only on the current tax receipts, which are rapidly dwindling. To pay the pensions Detroit would then have to pare back services or raise taxes even more, either of which again would hasten the flight of citizens and the drop in tax receipts. Then, eventually, there isn’t enough money to pay the pensions. Unconstitutional or not, they won’t be paid.

You can’t get blood from a turnip. Not even the Constitution can change that.

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