In November 2017, the former mayor of Pforzheim and her then treasurer were sentenced to imprisonment for embezzlement. In the years leading up to the financial crisis, they had tried to minimise the town’s interest burden and to balance the town’s budget through a series of risky financial transactions. They were not the only ones: During that time, hundreds of communities throughout Germany tried their hand at “casino capitalism” to rehabilitate their finances. In Pforzheim, this resulted in more than 50 million euros of new debt.
Why were chief executives allowed to take such risky decisions? It is cases of fiscal failure such as these that Junior Professor Julia Rischbieter examines as part of the new scientific network “Sc…
Read the full article at: https://www.eurekalert.org/pub_releases/2017-12/uok-sdi121417.php