— This is the script of CNBC's news report for China's CCTV on December 3, Tuesday.
Welcome to the CNBC Business Daily.
Being declared bankrupt might not be a good thing, but for the city of Detroit, it's just what the doctor ordered. CNBC's Scott Cohn has more:
Saying Detroit's current situation is unworkable and dangerous, US Bankruptcy Judge Stephen Rowe is allowing the city to go ahead and re-organize in the largest municipal bank filing in US history. This comes in the waning days of the term of Detroit Mayor Dave Bing who tried to put the best face on things.
[Soundbyte on tape by David Bing, Mayor of Detroit] I know that there are a lot of people that are upset and concerned about their futures, but we are now starting from square one.
But under the currrent system in Detroit, the mayor has virtually no power. That's all been delegated now to an emergency manager appointed by the state. He is Kevyn Orr, a bankruptcy lawyer by traning. He too says that this is a chance for Detroit to make a fresh start.
[Soundbyte on tape by Kevyn Orr, Emergency Manager for Detroit] Come forward with us, take this opportunity, even in the process of litigation and appeals, to try and get at the sorely needed reform that this city has got to achieve so we can move forward into a new day.
But Orr came under some criticism from the judge who said he mis-led the public about the city's pension obligations. The unions have seized on that as they would cover huge cuts in their benefits if the re-organization plan goes through and they almost immediately filed their notice of appeal.
About the only thing they said that could head that off was if Michigan's Governor Rick Sneider steps in and helps the state's largest city.
[Soundbyte on tape by Sharon Levine, Attorney, AFSCME] If the governor's not going to come to the table, if other parties aren't going to come to the table to keep some of their promises to these retirees, then we have to continue fighting unless and until that happens.
But while that fight continues in the appeals court, here in bankruptcy court, they will go about the hard work now of re-organizing this city's finances. Detroit has some $18.5 billion in non-funded obligations. The task now, try to get that under control and have the city emerge from bankruptcy by next year.
Scott Cohn, CNBC Business News in Detroit. Now, back to you.
Li Sixuan, from CNBC's Singapore headquarters.