Posted on 08/08/2014 6:35:54 AM PDT by C19fan
In November 1998, attorneys general from across the country sealed a historic deal with the tobacco industry to pay for the health care costs of smoking. Going forward, nearly every cigarette sold would provide money to the states, territories and other governments involved 2014 more than $200 billion in just the first 25 years of a legal settlement that required payments to be made in perpetuity.
Then, Wall Street came knocking with an offer many state and local politicians found irresistible: Cash upfront for those governments willing to trade investors the right to some or all of their tobacco payments. State after state struck deals that critics derided as "payday loans" but proponents deemed only prudent. As designed, private investors 2014 not the taxpayers 2014 would take the hit if people smoked less and the tobacco money fell short.
Things haven't exactly worked out as planned.
A ProPublica analysis of more than 100 tobacco deals since the settlement found that they are creating new fiscal headaches for states, driving some into bailouts or threatening to increase the cost of borrowing in the future.
(Excerpt) Read more at realclearpolicy.com ...
Yes and all those anti-smoking programs “for the children” that the money was to pay for are all working just fine, I’m sure
Ping!
Bummer. Sucks to be associated with those cancer sticks.
Wow! You'd have to be a government to be this stupid.
Public official who issue CABs should be thrown in jail. There was some school district that issues a CAB to raise $100 MM for schools with the balloon something on the order of $3 Billion.
‘swhy some people go to work for government...
Why on earth did any gov’t (county, state, federal) decide it had responsibility for anyone’s health care? That was the stupid move. People make bad choices & should have to deal with the consequences. This was never a place for gov’t involvement.
2018Wow, I can't believe that
And states can't simply walk away from the debt 2014 bondholders have a right to further tobacco payments even after a default.
Who in the hell proofreads this crap?
It other words politicians got greedy and lost most of the money.
Maybe they can use the money to run ads to encourage more smoking.
Goofy financial “deals” need a “claw back” provision. If the absurd assumptions that the bonds were sold under, don’t pan out, the government entity should receive the underwriting fees paid out back.
Are the “Wall Street” banks the same banks that own the Fed Reserve?
>>As it seems with everything Wall Street made out like a bandit. <<
Only fools make complex deals with people who are far smarter than them, and a track record of shady dealings.
I would not be surprized if politcians got paid off to agree to the deals.
It doesn't suck for the Wall Street Bankers. It doesn't suck for the investors. It doesn't suck for the state legislators that bought your vote with the upfront money. Who does it suck for?
States and counties and cities are even worse than the Federal government with financializing everything from fence posts to parking meters. And taking on way more debt than they can service.
Debt, debt, debt will be our ruin.
Detroit is only the canary.
The money wasn’t lost, it was used very valuable for the polticians. It was used to buy votes during some election or another....
Wall Street doesn’t come calling to help you, it comes to **** you.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.