BANKS ARE FAILING
It’s not a secret banks are failing, for decades it’s been part of the financial system. From 2000 to 2007 only 28 banks failed. Since the Mortgage meltdown in 2008 over a staggering 500 banks have failed and the end is nowhere near. As much as we hate banks, charging fee after hidden fee, they are a crucial asset to our economy. The monetary system lives on borrowing and lending money to develop a healthy economy.
Bankrupt U.S. Cities
MUNICIPAL BANKRUPTCIES ARE NOTHING NEW
Cities have filed for bankruptcy in the past for isolated events that occur because the city lost a huge lawsuit or had a local catastrophe (Earthquakes, Floods, Tornados). What’s different and quite troubling is that 20 cities filed for bankruptcy in 2012 and larger economic conditions seem to be the cause, we haven’t seen that since the Great Depression. Some of the noteworthy filings that recently happened in cities with a population of at least 300,000 were Detroit, Stockton, CA and Jefferson County, Al. These 3 cities combined in alarming debt of $25 billion dollars.
Residents of struggling cities are wondering what the possibility of bankruptcy means for them. Well once a city is bankrupt, it can cut pensions and other cut costs, which usually means fewer services such as police, firefighting, garbage collection and cut other city employees. Or it can increase revenue by raising taxes. Usually, it’s a combination of both, but real change is often a matter of political will and another bail out proposal.