It was certainly a privilege and honor to have the opportunity to meet with the Governor and his staff yesterday at the Capitol.
The issue of a new Transportation Bond issue, and the rather sophomoric explanation of how it isn’t going to cost the State a thing was discouraging to say the least. Bonds are debt, pure and simple and regardless of how it is going to be repaid, or what terrific terms we are able to borrow this money, given the States AAA Bond Rating, it is still debt. Elected officials are able to have their cake and eat it too, when they can lay claim to adding funding to Transportation needs, and passing the true costs to future generations of Virginians who are not old enough to vote yet.
The well known disparities in income along with employment between Northern Virginia and South/Southwest Virginia, compounded by 50% of the Transportation budget already allocated to Northern Virginia begs the question why more toll roads are not implemented to ease some of the traffic problems born primarily in two of the highest income ( per capita ) Counties in the U.S. A bond issue spreads out the costs to all Virginians, regardless of the fact that this is more of a local issue than a State issue. While the Governor’s staff take great comfort in the debt service being well within the range of ease, using Virginia’s portion of Federal money to service said costs , those funds are subject to political winds, as well as future cuts, certain to come given Washingtons tenuous finances.
The issue of privatizing the State’s ABC stores was more befuddling than anything. The only advantage I saw from the two options under consideration is it will generate a one time significant sum for the State, but after that the State is still knee deep in the Alcohol business. Equally troubling was learning that the State marks up Alcohol 69 % before it sells it to Virginians. The hypocrisy of elected officials who castigate the oil industry as villians when they are operating on 8-9% margins speaks volumes of their logic. Everyone else in the private sector is a crook. By their own admission consumers are not expected to see any declines in prices because of the States continued taxing and fees.. Perhaps in fairness it is worth noting the State will be out from under the lease obligations for the current stores, and the employee labor/benefit costs.
While we have made progress with this Administration the TEA Party can hardly take much comfort in believing we have truly put Conservatives in charge. That won’t happen until we turn over 2/3 of the General Assembly with Citizen-Legislators and get rid of the professional pols, from the top down.
Bob Shannon
Membership Liaison
VTPP
Bob – excellent summary! I agree with you. Susan
Our Economy is tettering on disaster. Why would anyone put their money in Bonds. When the Dollar tanks they will lose their money. The General Assembly has taken money from the State Employee Retirement Fund and from the Highway Fund that was there to fix the roads etc. and they (The General Assembly) can’t pay that back. Virginia is looking at paying higher costs for Social Programs and Unemployment benefits for those who can’t find work or refuse to work at any job because it doesn’t pay what they feel they deserve. Why do we not agree to an increase in the gas tax of $0.03 to $0.05 per gallon and have everyone who drives our roads help pay for the maintenance of our roads??? Gas is going up in price regardless and at some point we are going to be levied with a tax increase of some sort. We are paying a hidden tax already. What do you think inflation is?? We will need to be sure the General Assembly stays out of the fund and STOPS SPENDING MONEY. We don’t need all these laws and regulations they propose every year.
PLEASE READ “THE CREATURE FROM JEKYLL ISLAND A SECOND LOOK AT THE FEDERAL RESERRVE” BY G. EDWARD GRIFFIN. It will give you a good understanding of what is going on in our government as far as the economy is concerned. It will wake you up to the One World Government/New World Order. The book tells the reader about Sustainable Development/Smart Growth/Agenda 21/ ICLEI and how the Federal Reserve and the Money Trust is behind the over throw of our Capitalist System.We must work fast because they are moving at light speed to take down our Economy.
This book is about 700 pages. I am not an avid reader but I could not put this book down once I began reading it. Thank you for taking the time to read this post.
Thanks for your insight Bob. I was afraid I was the only person coming out of the briefing with that same impression!
I agree with this article. I was shocked to hear about a bond issue when we have no bussiness getting into debt. Wait until money is saved. Plus not being from northern VA I understand that the “southeners” don’t wish to pay for a few counties problems. Yes they are in need of congestion relief etc so tolls do work for those commuters in the area greatly affected. Yes tolls are taxes and it is also true that tolls never go away. Let the issue rot for a while, a few years and SAVE the money. I was feeling proud of VA’s bond rating. But the more debt accrued the rating goes down.
NO NEW TAXES.
I respectfully disagree. Not all debt is equal and I believe the governor’s staff made a good case that this is “good” debt. By that I mean that this seems to provide a real return. Tolls, as annoying as they are, are excellent ways of raising revenue for roads. It is a user tax on the people who benefit from the roads. I realize it is more complicated than that, but the idea that now is a good time to borrow is actually sound. The interest rates on the bond market seem to be favorable. The Transportation Secretary seems to be correct that the transportation budget is self-sufficient. I also see how the contracts he can negotiate are very favorable right now. One of my laments in government service was the way we bought things. I believe that pulling the expenditures forward, before the bond market hammers the states, is a smart move.
I do not like the idea of stimulus generally, however there is a potential benefit here and it allows the state to capitalize on a once in a decade opportunity. Overall, I think we should be backing the governor if he is making smart long term financial decisions and this appears to be one.
Besides the decent sandwiches and carrot cake (who told them?) I think the idea to privatize ABC is a sound one as well. This should not be in the government portfolio. Taxed, yes. Regulated, somewhat. I would like to see price controls go away.
As far as the debt management scheme that the Treasury proposed, hard for me to digest all the particulars. I did manage to understand that this would provide some cushion against fluctuation and doesn’t change our overall financial strength. I am not satisfied that I understand all their assumptions. I believe they will face some risk should the economy not recover quicker.
I walked away with a favorable impression. I don’t mind adding some debt for a greater return down the road. On the federal level, this was what they tried to sell but it was never structured that way. In our case, Virginia is well positioned to benefit from this plan. I support it overall.
How would a bunch of tea partiers support this? We could not oppose it. That would be a signal. We could let them know we will not oppose it. If these are projects that need to get done anyway and most of us in Hampton Roads agree they do, we should take advantage of the cost savings now. The reasoning was sound and I think we should support a good plan.