A potted history - the county's corrupt political class, in hock with some of America's biggest banks, turned a sewerage system upgrade into a scam that ended in twenty two convictions for officials and a lifetime's worth of crushing debt for taxpayers. As for what happened next, I'll let Matt Taibbi, who's been howling about this for eighteen months, take over...
In the end, every time Jefferson County so much as breathed near one of the banks, it got charged millions in fees. There was so much money to be made bilking these dizzy Southerners that banks like JP Morgan spent millions paying middlemen who bribed — yes, that's right, bribed, criminally bribed — the county commissioners and their buddies just to keep their business. Hell, the money was so good, JP Morgan at one point even paid Goldman Sachs $3 million just to back the fuck off, so they could have the rubes of Jefferson County to fleece all for themselves.
Well, Jefferson County just declared itself bankrupt and nobody is happy about it - not chief creditors JP Morgan Chase; not the receivers and certainly not the unfortunate residents, who have been paying through the nose for years for the criminal behaviour of their representatives and their co-conspirators.
I'll freely admit to being just as confused about this situation as I am about the Eurozone crisis. I've been looking for suggestions on what happens next, to no avail. Do the locals still have to stump up the cash, or does the receiver start repossessing public utilities? Does JP Morgan have to eat all that debt and apologise to its shareholders? I haven't got a clue.
One thing I do know, though - if I lived in Jefferson County, I'd be really pissed off right now, however it turns out.
Which brings us back to that argument over democracy and finance... How much responsibility would I bear for this situation, if I'd voted for one of these crooks? How about if I'd voted for somebody else, or for none of the above? We are, after all, not merely talking about irresponsible borrowing, so much as a criminal conspiracy against the citizenry.
I'm no genius, but I suspect that I might feel like I didn't owe any of these sharks a penny. I might even feel like I was the victim of a bare-faced con... And yet, I've read people whose opinions I trust saying exactly the opposite for similar situations like Ireland and Greece.
There's a column in the Times today applauding "the good people of Jefferson County" for defaulting and urging the same course of action for Greece, and I for one am stumped as to whether this is good advice or not. Anyone have an educated opinion to offer?