Los Angeles has solved its money problems the only way a progressive city council knows how: by spending more money to think about handling even more money.
On Wednesday the LA City Council voted 11-3 to spend $460,000 on a feasibility study for a city-owned bank, according to the New York Post. This comes while the city stares at a budget gap reported at around $100 million. That's like a guy getting his car repossessed and immediately paying a consultant to look into buying an airline.
Even one critic quoted by the Post couldn't hold it in: "We can't even manage our own damn finances." Sir, that's not criticism. That's the bank's slogan. Put it on the tote bags.
Picture the First Municipal Bank of Los Angeles. You walk in to open a checking account and the teller hands you a 14-page form, a land acknowledgment, and a ticket number. Your number is 4,000,112. Now serving: 3. The ATM gives out cash only after a three-year environmental review. Overdraft fees have been renamed "equity contributions," and the vault is guarded by a man who was hired as a "vault ambassador" for $190,000 a year and has never seen the vault.
Supporters say a public bank would keep city money away from big Wall Street institutions. Noble goal. But the people pitching this are the same leaders who get outplayed by potholes. They want to graduate from "can't fix the sidewalk" to "can now issue mortgages." What's next, a city-run airline where every flight is delayed by a homelessness task force meeting?
To be fair, $460,000 is a bargain by LA standards. In this town that buys a feasibility study, a half-built public toilet, or one parking space in Silver Lake. The study will no doubt take 18 months and conclude that a city bank is "feasible, pending additional study," which will cost another $460,000. That's not a bank, that's a subscription.
Wallet Walsh ran the numbers for free: if you're $100 million short, the most feasible bank is the one you don't open. You're welcome, Los Angeles. Send the check. Actually, don't. We've seen your checks.
The real genius is the business model. Normal banks lend money they have. LA's bank would lend money it borrowed from the budget it's short on, to fund programs it can't pay for, so it can study why it's broke. It's the circle of life, if life were run by a city council.
Taxpayers, keep your money under the mattress. At least the mattress doesn't need a feasibility study.
The Demorat is satire. This article is a comedy roast based on real news reports; quotes and scenarios beyond the cited facts are invented for laughs.
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