Mark Sanford says no bailout for South Carolina
Thanks to Tam, over at Bare Thoughts for alerting me to this article.
When President Bush, Secretary of the Treasury, Henry Paulson, and Congress first got together and decided some of these companies needed a bailout, at our expense, there were very few people who stood up and said no, this isn’t the way to go. Both Presidential candidates said yes, but people like Jim Inhofe, Senator from Oklahoma, and Mike Huckabee said no. Now that the bailout has passed Congress and is clearly not doing the job of reviving our economy, it seems that everyone and his dog has their hands out for federal money. Not only companies, but also cities and states. South Carolina Governor, Mark Sanford, is an exception and he states his case very well in an article in The Wall Street Journal.
I find myself in a lonely position. While many states and local governments are lining up for a bailout from Congress, I went to Washington recently to oppose such bailouts. I may be the only governor to do so.
But I suspect I’m not entirely alone, as there are a lot of taxpayers who aren’t pleased with Christmas coming early for politicians. And I hope these taxpayers make their voices heard before Democrats load up the next bailout train for states with budget deficits.
Several questions led me to oppose bailing out the states. They are worth asking, even if you supported bailing out Wall Street.
Who bails out the “bail-outor”?
Washington is short on cash these days and will borrow every dime of the $150 billion to $300 billion for the “stimulus” bill now being worked on. Federal appetites may know no bounds. But the federal government’s ability to borrow is not limitless. Already, our nation’s unfunded liabilities total $52 trillion — about $450,000 per household. There’s something very strange about issuing debt to solve a problem caused by too much debt.
Do you now have to be a financial “bad boy” to win?
Community bankers tell me that they are now at a competitive disadvantage for being careful about who to lend to, because others that were less disciplined will get a federal bailout. This is also true for states. Those that have been fiscally responsible will pay for or lose out to the big spenders. California increased spending 95% over the past 10 years (federal spending went up 71% over the same period). To bail out California now seems unfair to fiscally prudent states.
Was the economist Herb Stein wrong when he said that if something cannot go on forever, it won’t?
Medicaid grew 9.5% annually over the past 10 years. That’s unsustainable. But if Congress opens the checkbook now, there will be no reform.
Isn’t government intervention supposed to be the last resort and come only when it can make a difference?
In 2008 bailouts became the first resort. Over the past year the federal government has committed itself to $2.3 trillion (including the tax rebate “stimulus” checks of last February) to “improve” the economy. I don’t see how another $150 billion now will make a difference in a global slowdown. We’ve already unloaded truckloads of sugar in a vain attempt to sweeten a lake. Tossing in a Twinkie will not make the difference.
However, there is something Congress can do: free states from federal mandates. South Carolina will spend about $425 million next year meeting federal unfunded mandates. The increase in the minimum wage alone will cost the state $2.6 million and meeting Homeland Security’s REAL ID requirements will cost $8.9 million.
Based on what I saw in Washington, the bailout train is being loaded up. Taxpayers will have to speak up now to change its freight, tab or departure.
Mr. Sanford, a Republican, is the governor of South Carolina.
How much longer can our government continue to ignore the hard choices and spend our money with reckless abandon? Sooner or later, something is going to give way and I am afraid it is going to be the American taxpayer. We simply can not keep this up. Our jobs and our incomes are suffering because of the recession we are in. Yes, I said recession.
No matter what the government calls it, we are in a recession and it is one that has been coming for some time. During the Republican primary and debate season, some of the top candidates continually sounded off about how good our economy was doing, even though they were challenged in this assumption by Mike Huckabee and Ron Paul. Huckabee has been saying all along that we needed to be talking to the people who drive the cabs and carry the bags, instead of the CEO of the company and if we did, we would get an entirely different picture of how the economy was really doing.
Discretionary spending is down and for good reason; the money simply isn’t there. I am foregoing my normal deer hunting during the holidays because I am short on cash and need what I have for other purposes. That’s what responsible people do; we cut back when it gets tight. It seems as if the “financial bad boys” are getting a free pass to continue doing what they were doing; spending money like there is no tomorrow. As Governor Sanford said, this can’t keep going forever and when it finally stops, it isn’t going to be pretty.
That’s my take!
Larry
A lot of people thought Ron paul was crazy… but he has been predicting this mess for a long while. Now if people would listen to him, and others like him who were also predicting it on the best way to “fix” it…
Sanford is definitely a man to keep an eye on. He was just elected as Chairman of the Republican Governor’s Association.
When he was in the US house, he slept in his office in order to return his housing allowance to the treasury. he often joined Paul on his “no” votes.
As Governor, he has fought with his own party to cut spending and taxes. He even brought in a couple of piglets and let them loose in the state House to protest “pork”.