From Alternet: http://www.alternet.org/economy/155276/the_new_wall_street_racket_looting_your_city%2C_one_block_at_a_time/
New schemes hold the public hostage to private finance.
By Matt Reichel
May 7, 2012
May 7, 2012
When Mayor Rahm Emanuel introduced a “new and
innovative” financing tool last month to help Chicago renovate failing
infrastructure without precipitating another budget crisis, many in the
city were understandably critical.
Chicagoans have already
endured the notorious 75-year lease of their parking meters to a
consortium headed by Morgan Stanley. That sale promulgated a system
wherein the public is held hostage by private finance, due largely to
the inclusion of arcane legal stipulations like “non-compete clauses”
and “compensation events” in the language of the contract.
Ellen Danin, writing in the Northwestern Journal of Law and Social Policy
relates that: “Chicagoans learned about compensation events when CBS
reported that the city’s parking meter contract required reimbursement
for events like repairing streets. Public records showed that in the
first quarter of 2009, the city was liable to the parking meter
contractor for more than $106,000 in lost income during the slow months
for street repair and street closings for festivals, parades, and
holidays, as well as repairs and maintenance. At that rate, it is not
unreasonable to predict that Chicago will owe roughly $500,000 a year to
the private contractor.”
The city essentially acts as an insurer
for the meter merchants, with the return being a one-time injection of
roughly a billion dollars that the previous mayor, Daley the Second,
haphazardly exhausted on closing budget deficits in the waning years of
his two-decade tour at the helm.
With the current infrastructure deal, Emanuel has repeatedly claimed that this is not privatization: This is not like the parking meter deal. Can the public believe him?
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