Rand Paul likes you, really. Just not enough to bail you out.
When asked by Breitbart about the possibility of the federal government bailing out the bankrupt city, Paul said “over my dead body.”
“I basically say he [Obama] is bailing them out over my dead body because we don’t have any money in Washington,” Paul said.
Rather than bail the city out, Paul thinks Detroit can use their bankruptcy filing as a platform to purge poor management and get a fresh financial start.
“There’s some good things that come out of bankruptcy,” Paul said. “One is you get to start over. Bankruptcy lets you be forgiven of your debt. And you do so by getting new management, better management, and by getting rid of unwieldy contracts…where public employees are getting paid twice what private employees are and things come back more to normal. That’s the way cities and businesses can recover.”
Another problem, according to Paul, with bailing out Detroit is this: it sends the wrong message to other struggling cities.
“You don’t set up an implicit promise from the federal government that everybody is getting bailed out,” Paul said. “It’s sort of like too big to fail for banks. If you have too big to fail for cities or for states and they believe they’ll be bailed out they’ll continue to make unwise decisions.”
Senator Paul shouldn’t have much to worry about. All indicators out of Washington point to no Wall Street style bailout coming for Detroit. Last Friday, USA today writer David Jackson said that the Obama administration has “made it clear for months not to expect any sort of federal bailout for the now-bankrupt city.”
Detroit Emergency Manager Kevyn Orr feels the same way. Orr’s spokesperson, Bill Nowling, recently said that “There was never a formal ask, but I think the way it was portrayed to me that it was pretty clear there was going to be no bailout ...akin to what we saw in scope and intent for the autos or for Wall Street.”
The Obama Administration has not spoken extensively on the issue yet. Earlier this week, the White House said that Obama and his senior advisers will continue to monitor the situation.