Wall Street Plays Hardball

Source: Theo Francis, Ben Levisohn, Christopher Palmeri and Jessica Silver-Greenberg, Business Week, no. 4157, November 30, 2009

Taxpayers are taking another hit as strapped local governments fork over billions in fees on investments gone bad.

Detroit Mayor Dave Bing is struggling to save his city from fiscal calamity. Unemployment is at a record 28% and rising, while home prices have plunged 39% since 2007. The 66-year-old Bing, a former NBA all-star with the Detroit Pistons who took office 10 months ago, faces a $300 million budget deficit–and few ways to make up the difference.

Against that bleak backdrop, Wall Street is squeezing one of America’s weakest cities for every penny it can.

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