What does Detroit’s bankruptcy mean for San Bernardino?

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Detroit has been struggling for a while, and yesterday a federal judge ruled that the city is eligible for bankruptcy and can impose cuts to its municipal pension plans. That ruling could have a big impact in San Bernardino and other California cities that are seeking bankruptcy protection.

San Bernardino has not been able to make their CalPERS payments, explains bankruptcy attorney Michael Sweet. The judge essentially said that under the bankruptcy law,  pension payments can be reduced, and impaired.”That’s precisely want CalPERS doesn’t want to hear,” said Sweet.

One of these cases could end up at the Supreme Court.  “This is a constitutional question, it deals with states rights and the federal bankruptcy law,” said Sweet, “it’s a fundamental constitutional issue.”

Yesterday, KCRW’s Steve Chiotakis talked to bankruptcy attorney Michael Sweet. Listen below: