October 24, 2008

Subway Madness

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SUBWAY MADNESS….Apparently AIG, over the years, has guaranteed several elaborate tax avoidance schemes that allowed local transit authorities to make some extra money via sale-leaseback agreements with banks. Now that AIG is kaput, the schemes are falling apart and the transit agencies may suddenly get billed for tens of millions of dollars. Transit fan Matt Yglesias is pissed:

WTF is happening here? Can’t we, in exchange for all the money we’re giving AIG, force the company to keep guaranteeing deals that are vital to keeping our public services running? Something about the implementation of this bailout is very troubling and it doesn’t inspire a ton of confidence in the future of TARP.

Unfortunately, that doesn’t seem to be the issue. AIG is still guaranteeing the deals. The problem is that the contracts with the banks terminate automatically if AIG doesn’t maintain a high credit rating. Which, needless to say, they haven’t. So now the banks are demanding payment.

Which just goes to show how all this stuff trickles down not just to Main Street, but to the subways underneath Main Street too. However, a Treasury Department spokesman says, “Treasury is aware of this situation.” That should make us all feel better, right?

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WHO DOESN’T LOVE A POSITIVE STORY—OR TWO?

“Great journalism really does make a difference in this world: it can even save kids.”

That’s what a civil rights lawyer wrote to Julia Lurie, the day after her major investigation into a psychiatric hospital chain that uses foster children as “cash cows” published, letting her know he was using her findings that same day in a hearing to keep a child out of one of the facilities we investigated.

That’s awesome. As is the fact that Julia, who spent a full year reporting this challenging story, promptly heard from a Senate committee that will use her work in their own investigation of Universal Health Services. There’s no doubt her revelations will continue to have a big impact in the months and years to come.

Like another story about Mother Jones’ real-world impact.

This one, a multiyear investigation, published in 2021, exposed conditions in sugar work camps in the Dominican Republic owned by Central Romana—the conglomerate behind brands like C&H and Domino, whose product ends up in our Hershey bars and other sweets. A year ago, the Biden administration banned sugar imports from Central Romana. And just recently, we learned of a previously undisclosed investigation from the Department of Homeland Security, looking into working conditions at Central Romana. How big of a deal is this?

“This could be the first time a corporation would be held criminally liable for forced labor in their own supply chains,” according to a retired special agent we talked to.

Wow.

And it is only because Mother Jones is funded primarily by donations from readers that we can mount ambitious, yearlong—or more—investigations like these two stories that are making waves.

About that: It’s unfathomably hard in the news business right now, and we came up about $28,000 short during our recent fall fundraising campaign. We simply have to make that up soon to avoid falling further behind than can be made up for, or needing to somehow trim $1 million from our budget, like happened last year.

If you can, please support the reporting you get from Mother Jones—that exists to make a difference, not a profit—with a donation of any amount today. We need more donations than normal to come in from this specific blurb to help close our funding gap before it gets any bigger.

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