City goes broke paying fees to Wall Street
Probably the best film about Wall Street greed was the 1987 film, Wall Street, with Michael Douglas. Nothing has changed in 25 years except it’s gotten worse.
Amount Los Angeles paid in fees to Wall Street in 2013 approximately $204 million while sewers, streets and schools have no repairs.
According to a recent report from a coalition of 15 unions and community organizations, “No Small Fees: LA Spends More on Wall Street than Our Streets,” the $204 million is a low ball estimate.
The study points out that as a result of the fees paid to Wall St., the city has “all but stopped repairing sidewalks, clearing alleys and installing speed bumps. It stopped inspecting sewers, resulting in twice the number of sewer overflows.”
“This is the first time an accounting of fees has been exposed for a specific public entity, and we don’t think we have captured it all. So if you do this for every public entity, cities, counties, school districts, states, and universities, transportation agencies and other public entities we could be looking at an astounding amount of money for education and community services money sucked out of the system,” the report reads.
Why do cities and states go to Wall Street for financing in the first place? The standard answer is that cities and states need to raise private capital from Wall Street because state and local tax bases are “increasingly constrained.”
In other words Wall St. is the only game in town because no one that talks about raising taxes has a snowball’s chance in hell of winning elected office in the United States.
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