BBC News reports: Banks stand to lose millions of dollars in debt repayments if the biggest municipal bankruptcy in American history is allowed to proceed.
But the real victims of the financial collapse in the US state of Alabama’s most populous county are its poorest residents – forced to bathe in bottled water and use portable toilets after being cut off from the mains supply.
And there is widespread anger in Jefferson County that swingeing sewerage rate hikes could have been avoided but for the greed, corruption and incompetence of local politicians, government officials and Wall Street financiers.
Tammy Lucas is the human face of a financial and political scandal that has brought one of the most deprived communities in America’s south to the point of what some local people believe is collapse.
She says: “If the sewer bill gets higher, my light might get cut off and if I try to catch up the light, my water might get cut off. So we’re in between. We can’t make it like this.”
Mrs Lucas’s monthly sewerage rate bills – the amount levied by the county to flush away waste and provide water for baths and showers – has quadrupled in the past 15 years. She says it is currently running at $150 (£97) a month, which leaves little left out of her $600 social security cheque for food and electricity.
The scandal of the Alabama poor cut off from water
By December 16, 2011,