Unless city officials make drastic changes, Los Angeles will be bankrupt by 2014, former LA Mayor Richard Riordan told CNBC.
By this time next year, the cost of retirement pensions in Los Angeles will have jumped from $500 million to nearly $1.25 billion. This coupled with an unemployment rate of 12.3 percent — higher than the 9.6 percent national unemployment rate— has led some city officials, and Riordan, to fear for the worst.
"The stimulus has hardly created a single private job,” Riordan said. “It’s all public jobs, most of which won’t last very long because they’re going to finish a bridge or a tunnel, or whatever they’re working on. And if you’ve heard other things, ridiculous things that that money has been used for.”