The town of Benton Harbor, Mich. has found itself at the center of a statewide controversy, one which may have repercussions for small communities across the United States, after the predominately African-American community saw its leaders stripped of much of their governing ability by a state executive action and replaced by an unelected official.

The town, home to Whirlpool’s corporate headquarters, has been hit hard by the loss of manufacturing jobs in recent years. The town’s population has declined to 10,235, according to statistics presented on MSNBC’s Rachel Maddow Show.

The town that once contributed 50 percent of the county’s tax base now accounts for less than 7 percent, according to the Harbor Shores Lake Michigan Community Benefits Plan. Home ownership is less than 40 percent of its residents, and literacy and scholastic success are on the decline.

The city’s elected officials have attempted to cope with the economic devastation as best they can. But in March, Republican Gov. Rick Snyder signed a bill giving emergency financial managers—agents assigned to municipalities with documented financial difficulties—extensive powers. The bill makes it possible for the managers to greatly curb the power of elected officials, disband contracts and even unincorporate the city if they believe such actions will solve its financial problems.

Benton Harbor’s manager, Joseph Harris, an African American, was the first to use the law when he issued an order allowing the city’s elected officials only to call meetings, approve minutes and adjourn meetings, essentially taking over all other aspects of running the city.

Local residents have tried to push back, speaking out at the sole city meeting where Harris even allowed it, according to Maddow. One participant said, “Now we have a dictator in.”

Even cable’s Comedy Central is throwing darts at the way Benton Harbor’s dilemma is being handled. Stephen Colbert, on his show “The Colbert Report,” comically characterized the emergency manager as a dictator whose power allows him to sacrifice the democratic process in order to quickly resolve a municipal financial crises. “Harris had to strip the elected representatives of their power or they might have opposed his ways to save money,” he said on a recent segment.

Lansing, Mich. Mayor Virg Bernero said in an interview with Maddow that emergency financial managers were intended to be rarely used and were to work in concert with elected officials. But with the new powers granted under Snyder’s law, “now they are in charge. Now they can fire elected officials,” he said.

A Democrat, Bernero lays this devastation squarely at the feet of state Republicans even the initiative was launched during the term of former Gov. Jenifer Granholm. “What happened to local control? I thought the Republican Party was the party of less control,” he said to Maddow, “Less government and less control. They have thrown local control out the window. This is a return to King George. This is what the American Revolution was about.”

While residents and unions have protested the legislation across the state, no reduction in the power of the managers is on the horizon. In fact, Bernero told Maddow that 200 new emergency financial managers are currently being trained. “This is an industry now,” he said.

But in Benton Harbor, Harris’ motives may go further than simply helping the town get back on its feet. One of the town’s cherished assets, Jean Klock Park, a half-mile of sandy dunes on the edge of Lake Michigan is being targeted for removal from public access and developed into what critics label a theme park for the rich.

Plans are in the works for a converting the land that was given to the town in 1917 by the Klock family into golf resort with a 530-acre mixed use development backed by the Whirlpool Corporation.. It would include a 350-room hotel, two marinas and a 60,000-foot indoor water park.

The emergency manager, by taking over the Brownfield Redevelopment Authority, has access to the land, according to the Chicago Sun Times, which reported that one of the architects of the law is a former aide to Rep. Fred Upton (R-Mich.), an heir to the Whirlpool fortune.

A statewide group, Michigan Forward, is working to collect signatures to get the repeal of the measure added as a ballot referendum. Meanwhile, Benton Harbor has found an ally in the Rev. Jesse Jackson, who has visited the community twice in recent weeks and toured the state organizing opposition to the emergency financial manager law.

“There’s nothing about the economic crisis that should disseminate our right to vote, we should reinforce democracy,” Jackson told South Bend, Ind. CBS affiliate WSBT.