By: Mark Glennon*
Why didn’t somebody think of this sooner? Mayor Emanuel has proposed authorizing the City of Chicago to buy bonds issued by Chicago Public Schools. (The full, proposed ordinance is linked here.) The same taxpayers can be both lender and borrower! No need for the muni market and their blather about junk bonds. And no need for those boring, pesky offering statements and disclosures — CPS and the city can just use mirrors. Heck, why not take the idea further and let Chicago’s pensions buy the city’s bonds?
The basic concept is perfectly sound. Only a science-hating skeptic who never played a simple shell game would fail to grasp its simple elegance, shown on the right.
The politics of it are appealing, too. Everybody believes in pulling yourself up by your own bootstraps, right? Same idea. Up we’ll go.
Yet, some say Chicago has gone mad. Ha! About as mad as this dog. Even he understands the concept. Attaboy, Rahm.
*Mark Glennon is founder of WirePoints. Opinions expressed are his own.