It was shady Wall Street deals that most recently destroyed the finances of Detroit. Now, as the city continues to struggle with water shutoffs and widespread financial indignities, Michigan wants to punish the victims again, by relaxing pollution regulations in a way that will disproportionately sicken the people of Detroit.
I probably don't need to remind you that the current financial state of Detroit, and the primary victims of that widespread financial damage, is attributable to the alliance between Wall Street banks that lured the city into risky deals that crashed and the emergency management regime that blamed the working class victims of those deals for the crime of wanting the livelihood promised to them. These were
credit swap transactions with bondholders — deals [that] have cost the city hundreds of millions of dollars in unnecessarily high interest rates, and could cost hundreds of millions more if so-called “termination” payments are called in.”
“This isn’t just a question of black people being denied the vote. It is also about the imposition of the economics of austerity on a city that has suffered tremendous hardship at the hands of the big banks and Wall Street, both in terms of the predatory lending schemes that led to a devastating foreclosure crisis in Detroit, and in terms of equally predatory schemes used to jack up the rates on bond payments.”
Now an impoverished Detroit population will be made to breathe dirtier air, and suffer other pollution-induced, health-threatening indignities:
The state Department of Environmental Quality plans to give big polluters a free pass to emit toxic chemicals into our air, putting Michigan children in harm’s way.
The state’s proposed deregulation of some 500 chemicals would pack a potent punch in Detroit, where many people live in the shadow of heavy industry, and where asthma puts residents in the hospital three to six times as often as in the rest of Michigan.
So just to be clear here, the banks played a role in massively increasing poverty, those in positions of power capitulated to the paradigm and financial arrangements that most assuredly guaranteed that poverty, and now the poor will be choked with toxins.
Pollution is a negative externality--just as the impoverishment of cities is a negative externality. The Wall Street world view is that such externalities should be "socialized" among those least able to fight back. In 2014, the Public Banking Institute released, and over 60 people and institutions signed, the Detroit Statement, which reads in part:
Detroit starkly demonstrates that, when government becomes a subsidiary of private finance, the bankers "socialize" the harms during bad times (while exempting those at the top of the economic hierarchy from virtually all costs and negative externalities), while they privatize the gains during good times. It is no coincidence that these poor financial decisions were made in the midst of the engineered deindustrialization of American cities. Nor is it coincidental that all of this has been accompanied by a racist and classist rhetoric of “failure,” “incompetence,” and “corruption;” Nor that it occurs in a context of privatization of every sphere of social life, a vanishing commons, and hollowing out schools, transportation, public safety, public health, food assistance, job training, public parks, postal services and the arts.
Awareness of the solution --which includes public banking-- is growing, but as this latest externality dumping demonstrates, the American people are running out of air to breathe. We need to step it up. And municipalities need leadership that understands that what's good for toxic industry--financial or chemical--is decisively not what is good for residents.
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