Bailing out states is a bad idea

[Rebel]

By Mark Sanford, Guest Columnist
Tuesday, November 18, 2008

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 -- maybe 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-outer"?

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 percent over the past 10 years (federal spending went up 71 percent 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 percent 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 a 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.

The writer is governor of South Carolina.

http://chronicle.augusta.com/stories/111808/op__483872.shtml

This is the man "I" want to run in '12. When he was in Congress, he did what he said. He spent 2 terms and left. He also received awards from various groups like Citizens against government waste.

[thundley4]

I don't think the states should be bailed out, nor any cities.  The car makers can suck it too.  The assinine way the mortgage bailout has been handled is proof enough that Washington has no clue how to "fix" anything. 

Most states and cities are in messes because of their own fiscal policies. Illinois and CaliFruitopia are two examples of overspending/overtaxation that drives businesses and working people out of their states.

[Rebel]

I don't want to bail out ANY of'em. You don't reward failure. When you do, you retard ingenuity.

[formerlurker]

Some idiot congressman from MI was on Cavuto today (was just listening to it, so I didn't see who it was) promoting the auto industry buyout.   Cavuto had some pretty heated interviews today and was worked up when he said something like "when is it going to stop?  what else are you going to do with my money?", to which the Congressman interrupted by yelling "it's not your money."

I think Cavuto fell off his chair at that point.

I had no idea it wasn't our money.  I wonder whose money it is then -- is there some generous soul out there donating a couple trillion dollars, or could it be this idiot Democrat actually thinks it's the "government's" money that did actually magically grow on trees.

S-C-A-R-Y. 

[Thor]

That's the problem with Congress today. They don't see that money as "anybody's money", they see it as the "Government's money". What they forget is just WHO is the "Government". It is the everyday normal citizen who pays taxes. So, YES, Mr Congressman, it IS MY money !!

[Crazy Horse]

Rebel is that article from an El Cid cadet about to fire on the new "Star of the West"

If so 

if not 

[Ptarmigan]

Texas is not asking for a bail out, yet we got whacked by Ike and it is the third costliest hurricane in US history. We got little media coverage. Tell the truth, I am torn if the media should pay a lot of attention on us after Ike, like after Katrina. Than again, New Orleans got a lot of attention after Katrina, even though other areas were hit as hard. Granted, we have recovered nicely and people were ready to rebuild without all the bickering that plagued New Orleans after Katrina. All the media coverage on New Orleans may have actually hampered recovery effort.

[Rebel]

Texas is not asking for a bail out, yet we got whacked by Ike and it is the third costliest hurricane in US history. We got little media coverage. Tell the truth, I am torn if the media should pay a lot of attention on us after Ike, like after Katrina. Than again, New Orleans got a lot of attention after Katrina, even though other areas were hit as hard. Granted, we have recovered nicely and people were ready to rebuild without all the bickering that plagued New Orleans after Katrina. All the media coverage on New Orleans may have actually hampered recovery effort.

You, like Biloxi and Gulfport, didn't have the racial component that the media could use to blame "evil Rethugs". If it would have hit hard in Houston, and flooded a ton of low-lying black areas, trust me, it would be that Bush was evil and was causing this shit.

[Ptarmigan]

You, like Biloxi and Gulfport, didn't have the racial component that the media could use to blame "evil Rethugs". If it would have hit hard in Houston, and flooded a ton of low-lying black areas, trust me, it would be that Bush was evil and was causing this shit.

You are right. At least Biloxi, Gulfport, Slidell, and St. Bernard Parish are recovering and making efforts at it and they were just as hit harder by Katrina than New Orleans. At least in our area, people of all races and classes came together and helped each other. Granted, there was frustration and stress, but that happens in any disaster. There was some looting, but they were arrested or shot at. Funny thing is Galveston has a larger proportion of poorer people, based on UTMB's debt incurred due to indigent patient care before Ike. Many poor people go to John Sealy Hospital, which is part of UTMB. Galveston was wacked badly by Ike includling UTMB, which is leading to a massive lay off.