[quote=FlyerInHi]It’s a little different CAr. Wall Street paid back the bailouts. As I believe NYC paid back the loan it got back in the 1970s. Detroit is losing residents and can’t possibly pay back.
They are in a catch 22. If they don’t improve services, the city’s tax base will continue to shrink. But if they pay pensions and bondholders, they don’t have enough money to improve services to attract residents and businesses.
Maybe the Michigan Supreme Court will rule on this eventually. Will it go to the US Supreme Court? I doubt it.
As to low interet rates, why do you expect to make money just holding money? You get paid for your productivity… There is no inherent right to earning interest on cash.[/quote]
Wall Street did NOT pay us back for the bailouts. Don’t be fooled by the “TARP” nonsense. That was just a small part of the tip of the iceberg where the bailouts are concerned.
There are the “cash for trash” programs where the private sector got to off-load their bad investments onto the Fed and government (including the refinance wave with the low rates over the past few years, which enabled the private mortgage lenders to recoup their money as borrowers refinanced into govt-backed mortgages), the homebuyers’ tax credit (state and federal) which pushed up the value of assets, the loss-sharing agreements with investors (many of whom are the very same people who drove the bubble in the first place!), the Fed’s buying of mortgages and Treasuries which keep rates for these products below market levels (harming investors who are not paid for the risks they are taking), the inflated prices/diminished purchasing power of everyone on fixed incomes because of all the “stimulus” (which includes everyone who works for a paycheck), lost interest/investment income for savers, etc.
We’re talking about trillions of dollars that have been taken from Joe Sixpack and given to speculative investors, asset holders and others who should have lost their shirts because of these foolish investments.
I find it funny that when the bailouts for bankers were passed, we were told that we couldn’t claw back money from these thieves (the executives of the large financial firms that caused the bubble and subsequent crash), or punish them financially in any way, because they had “contracts” that had to be honored from these financial institutions. But when the subject of clawing back pay from teachers, cops, firefighters, etc. comes up, everyone is buying the propaganda that they somehow caused the financial crisis. They didn’t; they had NOTHING at all to do with the financial crisis, they haven’t been the beneficiaries of the increased costs of their compensation. Wall Street caused the pension crisis as the pension funds moved from in-house fund management & mostly bonds to outside management and riskier investments (thanks to heavy lobbying by Wall Street over the decades), and the healthcare/pharmaceutical industries have benefited from the increased healthcare/drug costs. Public employees have not been the beneficiaries of these increased costs for the most part (and what few increases, especially the pension enhancements, have been passed, I oppose).
