The Role of Corporations in the Grand Bargain of Detroit

Posted by Maud Lyon, Jul 31, 2014 0 comments

Maud Lyon Maud Lyon

If you want to know why art matters, look at Detroit. Art has become the centerpiece of the plan for Detroit to emerge from municipal bankruptcy. The visionary plan began to take shape last fall with three goals: protect the city’s retirees from disastrous cuts in their pensions; avoid years of contentious litigation that would hamstring efforts to rebuild Detroit; and avoid selling the collection of the Detroit Institute of Arts (DIA) to pay the city’s debts.

Dubbed the Grand Bargain, indeed it is. Everyone has to contribute in one way or another, and everyone gives up something to make it work. A group of more than 13 foundations, national and local, have pledged $366 million over the next 20 years to support the pension fund. The State legislature approved $195 million in current dollars for this special fund (equivalent to $350 million over 20 years). The DIA’s board voted unanimously to raise $100 million, not for the DIA, but for the pension fund, and as of mid-July, have achieved pledges for 80% of that goal.

The City retirees have to vote to approve the plan and to give up litigation–which gives them a 4% cut in pensions instead of 26% or more. The vote results will be announced this week too. If everyone contributes and agrees, the city will emerge from bankruptcy within 18 months, retired city workers will suffer far less, and the DIA’s collection and building will be transferred from the city to the private nonprofit that operates it, protecting it as a legacy for the community forever. But it only happens if all parties play their part.

The DIA has been the point of the spear. Publicity about the bankruptcy has zeroed in on whether the art will be sold or not, raising a community outcry. For every voice that says “sell the art” there are many more that advocate to protect it, voices coming from every level of the community. The DIA is the symbol of what we want to have after bankruptcy: a city with beautiful things in it, for everyone. But being visible is only one role the DIA has played. While the foundations are motivated as much or more by saving the retirees and avoiding years of litigation for the City, it was art that initially brought them to the table. In raising the $100 million, the DIA is also contributing its considerable fundraising acumen and clout. Museums know a lot more about donors than cities do, and have relationships and dedicated board members who can make such an extraordinary campaign happen with astonishing speed.

Very recently, nine major corporations announced major gifts to the fund, and two of those are not headquartered in the Detroit area. Ford, GM and Chrysler contributed before this latest announcement. The next wave will include many individuals, both wealthy people and those with lesser means. Not only does this raise money, but it is engaging the entire community with a tangible, practical way to help. A year ago, talk of the bankruptcy was full of fear. Today, it is filled with hope, and a united sense of purpose.

Art and culture represents the best of us. It manifests creativity and excellence. Art belongs to the community as a whole, uniting people across political and social boundaries. It expresses our common values–in this case, believing in the future of a great city. So if anyone tells you art and culture doesn't matter, tell them this: in Detroit it does.

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