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Wall Street Sucking Cities Dry

Instead of cities blaming unions and their union pensions for cities going broke, the cities should take a lesson from unions on how to negotiate with Wall Street who are the ones who, with their financial fees, are sucking U.S. cities dry. In 2014, the labor unions found that Los Angeles city had spent twice as much on bank fees in 2013 as it had on street repairs, which resulted in a campaign slogan: “Invest in our streets not Wall Street.” It was a call to the big banks and Wall Street, thugs who gamble with our pension money and are not willing to help on fees charged, which keeps going up. This is where the cities should take a page from the labor movement and bargain collectively on interest rates and other financial deals. This needs to be done now because during the last 20 to 30 years banking industry has shifted its profits schemes to now rely heavily on fees—the money charged for creating loans and packaging them into securities, selling them and servicing them. They charge whatever they can get away with. Los Angeles paid $3.34 million in 2013, and this did not include interest or fees for hedge funds. Illinois State was charged $400 million in fees, and New York was charged $2.5 billion. The fees have been eating up the pension funds in the past 10 years. Governors in states like Wisconsin, Michigan, and Illinois are waging war on collective bargaining and telling taxpayers that empowering public sector unions rob state coffers. The real drain on public treasuries is the billions paid in fees to banks every year. Unlike money that goes into workers pockets, most of the fees are not recycled back into the local economy, but sent to offshore tax havens or invested in complex financial schemes. All cities should go together and demand a much better deal for our taxpayers’ funds just like unions do. It would be a union of cities for the betterment of the people. Rolling Stone magazine’s excellent writer Matt Tiabbi called Goldman Sachs a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money. It is all of Wall Street stealing billions away from the workers. It is the 1 percent versus the 99 percent. These are the same group of parasites who are destroying Greece, Puerto Rico, Portugal, Spain, Italy, and many other countries who invest through Wall Street. It will only stop when we make them stop.

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