Similarly, we have the U.S. government wildly understating inflation. The epitome of this occurred in July of last year. Asian governments were having an emergency summit to deal with the "global food-price crisis"; the World Bank was reporting food-inflation at an annualized rate of 120%; and the U.S. government claimed (in this global economy) that inflation inside the U.S. was literally 0%.
As I've noted in previous commentaries, when any government grossly understates inflation, this automatically grossly exaggerates many statistics directly derived from that inflation number, most notably GDP. The "GDP growth" reported by the U.S. government for the past four years of this so-called "recovery" is no more substantial than the fantasy jobs reported by the BLS, and no more plausible than the U.S. government's "0% inflation" claim.
What this means is that the "state administrator" being sent in to supposedly repair Detroit's financial crisis has a 0% chance of succeeding. Garbage in; garbage out. Armed with the same fantasy data as his/her predecessor, the revenue projections for "the New Boss" will be just as laughably optimistic as those of "the Old Boss."
What could (will) this administrator do?... an appointed city manager would ultimately hold powers to cut city spending, change contracts with labor unions, merge or eliminate city departments, urge the sale of city assets, and even, if all else failed, recommend bankruptcy proceedings.