Mayor provides leadership through economic woes

By: Editorial Board

Posted: 11/21/08

First it was mortgage-backed securities companies. Then came the private banks. So on and so forth, until Nov. 14, when Philadelphia itself asked to be bailed out by the government.

The economic crisis has now truly hit home, as Philadelphia, Atlanta and Phoenix have asked the government for, "At least $50 billion in emergency financing … from the federal Treasury to help with infrastructure renewal, pension costs and short-term borrowing, which have all been curtailed by the credit crisis," The New York Times reported Nov. 14.

"The cities are calling on Treasury Secretary Henry M. Paulson Jr. to release the money from the $700 billion Troubled Asset Relief Program authorized by Congress to bail out banks and financial institutions," according to The New York Times.

Philadelphia Mayor Michael Nutter is leading the charge, and has spoken publicly twice already about the cities' request, each time emphasizing the same message - that Philadelphia is asking for "access to capital" and not freebies.

"We're not asking for a bailout, we're just asking for a hand," Nutter said on MSNBC. "If we're not providing services, and laying people off and cutting back, it's having a negative impact on the overall economy of cities all across America."

Whatever the case may be, we commend Nutter for taking on this leadership role. This effort has not only been a regional issue for Philadelphia, but also a national effort, as more cities try to get involved with the bailout.

Though it is not certain whether the Treasury will actually consider this request, given the recent door shut in the faces of the Big Three auto companies, it is a breath of fresh air to see the mayor of Philadelphia step up to the plate.

From the start, Nutter was given a mess to clean up from the John Street administration, and the economic crisis has certainly not helped. And though getting bailout money may be a quick fix, it shows that Nutter is putting in effort to take charge of how the economic downturn has affected Philadelphia and its citizens.

"In [the letter from Philadelphia, Atlanta and Phoenix to the Treasury], they made the case that dwindling revenues have led to layoffs and cuts in services, and dried-up sources of credit have made it hard for cities to get bonds for infrastructure projects that could provide jobs," The Associated Press reported Nov. 18.

Layoffs and cuts in City services will only exacerbate our economic problems. Federal money may make it possible for hundreds of people laid off in Philadelphia to begin working again, or possibly to reopen libraries, swimming pools and fire companies that were recently shut down as a result of budget cuts.

Philadelphia City Council passed six bills Nov. 20 to help fill in the City's $1 billion deficit in its five-year plan, which shows that the City and Nutter are still focused on solving the credit crisis and economic problem at home.

Let's hope the concentrated efforts on the home front continue if federal money is pumped into Philadelphia - otherwise, Philadelphia will not benefit from a bailout, but instead will create a bigger financial crisis for itself in the years to come.