Wednesday, March 31st, 2010
Flashback: J.P. Morgan rolls into Calgary | JPMorgan, Citigroup Helped Doom Lehman, Report Says | Goldman role in Greek crisis probed | How EU Countries Cooked Books Using Derivatives | Goldman Sachs Helped Greece Obscure Debt Through Currency Swaps | America slides deeper into depression as Wall Street revels | How Goldman secretly bet on the U.S. housing crash | Goldman Sachs breaks record with $16.7bn bonus pot | More US Bank Failures and The Coming Deposit Insurance Bailout | Arrest Over Software Illuminates Wall St. Secret | The Lords of Time: Goldman Sachs and low-latency trading | Record quarterly profits and bonuses: Goldman Sachs makes out like a bandit on taxpayer’s dime | Goldman-Sachs: Pilfered trading code could be used to ‘manipulate markets’ | Taibbi: NYSE ends transparency to protect Goldman Sachs | Central banks to take off ‘training wheels’ | Goldman Sachs: The Great American Bubble Machine | 10 U.S. banks to repay U.S. bailout money | Top Senate Democrat: bankers “own” the U.S. Congress | Barclays, Lloyd’s, RBS join Goldman-Sachs in the black | Goldman-Sachs to repay TARP loan, resume private operations, bonuses, at “earliest time” possible | Which Banks Will Rule? | Wall Street’s Big Takeover | IMF may need to “print money”, act as “world’s central bank” as crisis spreads | Behind the panic: Financial warfare over the future of global bank power | Goldman-Sachs Alumni Hold Reins of Financial System | What Really Killed Bear Stearns? | Soros points out regulated markets fail to operate on market fundamentals, calls for more regulation | Competition study calls for lowered barriers to foreign ownership, bank mergers | Massive overhaul urged on foreign investment in airlines, media, and banks | Bilderberg Seeks Bank Centralization Agenda
Matt Taibbi, Rolling Stone
March 31, 2010
How the nation’s biggest banks are ripping off American cities with the same predatory deals that brought down Greece
If you want to know what life in the Third World is like, just ask Lisa Pack, an administrative assistant who works in the roads and transportation department in Jefferson County, Alabama. Pack got rudely introduced to life in post-crisis America last August, when word came down that she and 1,000 of her fellow public employees would have to take a little unpaid vacation for a while. The county, it turned out, was more than $5 billion in debt – meaning that courthouses, jails and sheriff’s precincts had to be closed so that Wall Street banks could be paid.
As public services in and around Birmingham were stripped to the bone, Pack struggled to support her family on a weekly unemployment check of $260. Nearly a fourth of that went to pay for her health insurance, which the county no longer covered. She also fielded calls from laid-off co-workers who had it even tougher. “I’d be on the phone sometimes until two in the morning,” she says. “I had to talk more than one person out of suicide. For some of the men supporting families, it was so hard – foreclosure, bankruptcy. I’d go to bed at night, and I’d be in tears.”
Homes stood empty, businesses were boarded up, and parts of already-blighted Birmingham began to take on the feel of a ghost town. There were also a few bills that were unique to the area – like the $64 sewer bill that Pack and her family paid each month. “Yeah, it went up about 400 percent just over the past few years,” she says.
The sewer bill, in fact, is what cost Pack and her co-workers their jobs. In 1996, the average monthly sewer bill for a family of four in Birmingham was only $14.71 – but that was before the county decided to build an elaborate new sewer system with the help of out-of-state financial wizards with names like Bear Stearns, Lehman Brothers, Goldman Sachs and JP Morgan Chase. The result was a monstrous pile of borrowed money that the county used to build, in essence, the world’s grandest toilet – “the Taj Mahal of sewer-treatment plants” is how one county worker put it. What happened here in Jefferson County would turn out to be the perfect metaphor for the peculiar alchemy of modern oligarchical capitalism: A mob of corrupt local officials and morally absent financiers got together to build a giant device that converted human shit into billions of dollars of profit for Wall Street – and misery for people like Lisa Pack.