The Pennsylvania Budget and Policy Center, a progressive-leaning government watchdog, is taking on Wall Street (without tents, we believe).
According to a report released by the group today, the city and school district have lost $331 million from interest rate swaps with big banks like Morgan Stanley and Goldman Sachs — and could lose $244 million more in future years.
Interest rate swaps are complex, risky financial agreements that dozens of local governments and school districts throughout the state entered into before the economic meltdown.
At a press conference this afternoon, the Policy Center's director Sharon Ward said the banks should return some of their expensive cancellation fees to the city and School District, as well as renegotiate the current swaps. She argued that they should be "good corporate citizens," especially because taxpayers bailed them out.
Ward was joined by an Occupy Phlly member, a public school parent/advocate, a former School District nurse and Anne Gemmell, the political director of Fight for Philly.
When a reporter asked if others, including the city, should also be held responsible for the swaps, Gemmell said, "Let's not forget that the city was not bailed out." She added that banks likely knew more about the future of swaps than city or school district employees.
You can download the Policy Center's full report here.