How Wall Street Hustles America's Cities and States Out of Billions

Many powerful interests have jumped at the opportunity to use the crisis to eviscerate what’s left of the welfare state.

June 12, 2012

We all know that America’s cities and towns are in the throes of a deep financial crisis. And are told, over and over, what’s supposedly behind it: unreasonable demands by grasping state and municipal workers for pay and pensions. The diagnosis is a grotesque cartoon. Many of the biggest budget busters are on Wall Street, not Main Street.

In a country as big and locally diverse as the U.S., any number of wacky pay and pension schemes are likely to flourish, though some of the most outrageous turn out to cover not workers, but legislators.  But overall state and local pay has not been growing faster than in the private sector for equivalent work for many years now. 

What has driven cities and towns to the brink is not demands from their workforce but the collapse of national income and the ensuing fall in tax collections. Or, in other words, the Great Recession itself, for which Wall Street and the financial sector are principally to blame. But many powerful interests have jumped at the opportunity to use the crisis to eviscerate what’s left of the welfare state, roll back unionization to pre-New Deal levels, and keep cutting taxes on the wealthy. The litany of horror stories that now fills the media is ideal for their purposes.  READ MORE

Screwing Over Urban America: Why the GOP's Top Contenders Hate Cities

For the Republican contenders, urban areas are out of sight and out of mind.

January 3, 2012

The Republican presidential primary has covered significant ground. Against a backdrop of Iowan cornfields, candidates have debated socialism, capitalism, immigration and American exceptionalism, and have even touched on the finer points of Shariah law and the Federalist Papers. One thing you don’t hear about is America’s cities and the ongoing, and growing, urban crisis.

There are some oblique references, like Newt Gingrich’s suggestion that child labor laws be modified so that poor children can work as school janitors. “Really poor children in really poor neighborhoods,” mused Gingrich, “have no habits of working and have nobody around them who works … They have no habit of ‘I do this and you give me cash,’ unless it’s illegal.”

Gingrich’s comment is a surviving dog-whistle politics that include new state laws to drug-test those on public assistance and the ongoing effort to cut food stamps (and Gingrich did call Obama the “food stamp president”). The specter of the black ghetto still scripts urban dwellers as villains (often as thieves robbing the citizen either directly, or as in this Rick Santorum comment, indirectly: “I don’t want to make black people’s lives better by giving them other people’s money”). But unlike the era of Ronald Reagan’s welfare queen, today cities are more ignored than attacked. And this goes well beyond Iowa.

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