Three of America’s largest cities have asked Bailout
Posted by. David Gaffen | November 14, 2008, 2:32 pm
Three of America’s largest cities have asked the U.S. Treasury for billions of dollars to shore up pension systems, cover short-term borrowing needs and boost infrastructure spending.
The mayors of Philadelphia, Phoenix and Atlanta asked for the creation of a $50 billion fund to spur infrastructure investments as well as for loans to cover unfunded pension liabilities and to address cash flow crunches amidst tight credit markets.
They pointed to recent budget cuts in Philadelphia, Chicago, Phoenix and New York, saying that as cities finish rebalancing budgets their citizens could find themselves facing reduced police, fire and senior services as well as potential job losses.
They said stimulus packages currently under consideration by Congress would do little to help cities themselves because of their structure. The mayors envision funds to fulfill their requests coming from the government’s $700 billion Troubled Asset Relief Program. Of the $350 billion Congress has already allocated to Treasury under the program, $290 billion has been promised to several banks and to troubled insurer American International Group.
Mr. Paulson, in a news conference Monday, said assisting state and local governments isn’t the focus of the TARP legislation. The focus of TARP is to help strengthen our financial system and support lending institutions, he said.
Sources:
MarketBeat WSJ Online : TARP City
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