http://www.chron.com/disp/story.mpl/nation/6966881.html
The question is, why should the government( The taxpayer) have to reimburse the municipalities and local governments for the deliberate misconduct by the banks or the SEC?
It's time to make the banks and the SEC responsible for their own short comings in their excessive need to feed the greed on a prey that was all to easy to dupe, and one that should have never been seen in the cross hairs of their target goals.
Two lawmakers say Lehman Brothers' historic collapse cost school districts and local governments millions, forcing many to make major cutbacks.
Rep. Anna Eshoo, D-Calif., said 40 municipalities nationwide lost around $1.7 billion after the firm went under. She is introducing legislation that would require the federal government to compensate those governments.
At a hearing Tuesday probing what led to Lehman's collapse, Eshoo said San Mateo County, which is in her district, lost $155 million.
Lehman's meltdown in September 2008 was the biggest corporate bankruptcy in U.S. history. It threw global financial markets into crisis.
Another lawmaker said numerous governments suffered huge losses.
“These were school districts and local governments that made investments that they believed were conservative,” said Rep. Ed Perlmutter, D-Colo. “They trusted that federal regulators were keeping a watchful eye on companies like Lehman Brothers.”
The former chief executive for Lehman is scheduled to testify at the hearing, which will probe a bankruptcy examiner's report that the firm masked $50 billion in debt.
The examiner, Anton Valukas, however, criticized the company and the Securities and Exchange Commission. Lehman, he said, “was significantly and persistently in excess of its own risk limits,” he said in prepared remarks. The SEC, meanwhile, “was aware of these excesses and simply acquiesced.”
