Chicago car owners are driven to distraction Meg Babs and four friends are pumping quarters into an automated parking meter on Clark Street, two blocks from Chicago City Hall. Thirty-four quarters later, they look at the time they've accrued: one hour and nineteen minutes. For $8.50. "It's crazy - you put in a quarter you get two minutes, you put in $5 you get 49 minutes," Ms Babs, 21, says. It makes you want to take public transportation to get into the city. Ms Babs and her friends are not alone in their frustration with the city's parking rates. Fees have been rising since a 2008 deal saw Chicago lease its 36,000 parking meters to a consortium led by Morgan Stanley for $1.15bn for 75 years. The consortium is also backed by Allianz and Abu Dhabi's sovereign wealth fund. Chicago's parking woes highlight the growing tension between America's cities and the Wall Street banks, which have stepped in to offer to plug desperate municipalities" widening deficits. The bank invested in the city's parking system through Morgan Stanley Infrastructure Partners (MSIP), its $4bn infrastructure fund. MSIP has been snapping up assets in recent years including Southern Star Central, a company that transports natural gas to municipalities including Kansas City and Oklahoma City. The Chicago deal has been pilloried in the media, by residents and by Mayor Rahm Emanuel, whose predecessor rushed it through and used nearly all of the proceeds to plug budget holes. A spokesman for the consortium, Chicago Parking Meters LLC, says that only the city has the authority to raise rates. He points out that the company has invested in infrastructure, including 4,700 modern pay boxes. The city says the schedule of increases over the past five years - which took rates from as low as 25 cents an hour in some places to $2, $4 or $6.50 an hour - were written into the original contract, which many argue the city council and then-mayor's office had not fully considered. Chicago is not alone. In Oakland, California, local anger over an interest rate swap deal struck with Goldman Sachs more than a decade ago has boiled over into a city council attempt to boycott the investment bank from ever doing business with the town again. These banks are betting against the people and winning. There has to be a time when we say enough is enough Rebecca Ruiz-Lichter "These banks are betting against the people and winning," said Rebecca Ruiz-Lichter, of the "Coalition to Stop Goldman Sachs" group in Oakland. There has to be a time when we say enough is enough. Goldman declined to comment. Hundreds of municipalities struck swap deals with banks to protect themselves from volatile interest rate movements. But with interest rates hovering at historic lows for the past five years, the swap agreements are now costing local governments $2.5bn a year, according to estimates made last year by the Refund Transit Coalition, an advocacy group. Oakland city council members are still trying to figure out whether local laws designed to ban questionable contractors, rather than complex financial institutions, can be applied to Goldman. That illustrates the difficulty public bodies may have when they choose to take a stand against the perceived misbehaviour of Wall Street. Beyond privatisation and swaps, Wall Street banks have been touting "social impact bonds" as a new way for cash-strapped local governments to save money. Goldman, for instance, recently agreed to lend $4.6m to finance an early education programme in Salt Lake City and $9.6m for a recidivism programme at New York's Rikers Island jail complex. Re-incarceration rates would have to fall 10 per cent for the bank to recoup its entire $9.6m investment. Goldman gets more money if the programme surpasses the 10 per cent target, with its maximum return capped at $2.1m. Michael Bloomberg, New York City mayor, has guaranteed $7.2m of the loan through a philanthropic foundation. The bonds have sometimes been criticised by those who say that involving private investors in public projects can influence the way the programmes are created, run or evaluated. Loan guarantees may also end up costing the entities that provide them. Back in Chicago, there is little talk about the positive social impact of Wall Street involvement in municipal affairs. The Emanuel administration has been criticised for not fighting harder against Chicago Parking Meters and even joining the company in defeating a class-action lawsuit against the deal. A spokeswoman for the city said the terms of the contract forced the city to defend the deal. Alderman Ameya Pawar, who says he ran for office partially because his opponent had voted for the parking meter privatisation, says the agreement is representative of broader problems. "The parking meter deal is emblematic of when you have the private sector taking advantage of cities facing tough economic conditions," he said. There are a lot of people out there going around to cities facing tough times trying to scare them into privatising sources of revenue.