Banks Get Bailed Out, Transit Riders and Workers Get Sold Out
Published 06 Jul, 2012
The City of Philadelphia, the School District and SEPTA, at a time when all are hard pressed to make ends meet, are paying millions of dollars to Wall Street banks to service debt. These payments include bad interest swap deals the banks negotiated that have cost the City an estimated 331 million dollars.
The banks, bloated with cash from taxpayer bailouts and zero interest money from the Federal Reserve, are making huge profits from the city and public agencies that are paying fixed rates of interest.
One out of every six dollars in the 2013 Septa capital budget goes to service the Authority’s huge debt. SEPTA is losing four million a year to Bank of America because of interest swap deals that went south after the economy crashed. TWU Local 234 President John Johnson Jr. stated, “This is Corporate Loan Sharking, that exploits the tax payer’s dime in these toxic deals.”
What does this mean for workers and riders?
SEPTA has been forced to trim its capital budget by 25% because of funding shortfalls. The payments to the banks are part of the problem. Instead of fixing SEPTA’s crumbling infra structure public money is lining the pockets of Wall Street bankers who are reaping record profits. Declining service for riders and less work and fewer jobs for transit workers are the result.
TWU Local 234 is stepping up and stepping out to join with “Fight For Philly,” a nonprofit group organized to demand that the banks renegotiate the interest swap deals to reduce the cost of debt service and free public money to fund public transit. Through member education and internal organizing efforts Local 234 want to make sure that the riding public is made aware of who is really destroying the public transit system.
“We have to demand the banks, corporations, and the super rich be taxed to finance rebuilding transit and improving service,” said Local 234 President Johnson. “When our contract comes up for renewal SEPTA will target and label my membership as “greedy” for defending our wages and benefits while, the truly greedy bankers will be given a free pass. ”