|
Send to a friend
Printer Friendly PDF Format
Subscribe to FFF Email Update
Subscribe to Freedom Daily
I Vote against Bond Issues
by
Gregory Bresiger,
November 11, 2005
In the private sector, there is every incentive to economize to provide the best products at the lowest possible prices to ensure customer loyalty. That is the road to profits. It is a road that can take years of painstaking work to build.
In the public sector, the incentive is always the
opposite. It is to win elections, which happen at least
every other year and sometimes more often.
The incentive in the public sector is to spend, spend,
spend, and then spend some more. It is the tendency to
treat citizens like little children and spoil them rotten
with endless gifts, something the brilliant
Alexis de Tocqueville warned us of more than a century
and a half ago.
It is the decision to run up bills on the premise that
more services today are always better than living on a
budget, no matter the costs to taxpayers tomorrow or to
generations of taxpayers yet to be born.
An example of the this public-sector phenomenon was
recently seen in New York, where a transportation bond
issue, supported by all major politicians of every
stripe, including fiscally conservative
Republicans, just passed in a landslide. But my example
can be applied to almost any state or city or other level
of government in the country.
Early this year the media blitz in favor of a $2.9
billion bond issue began. Big labor unions combined with
politically connected contractors in a coalition to push
through this bond issue, which was Proposition Two on the
ballot.
This coalition of special interests plastered posters all
over the state. They had their politicos constantly
talking it up. Their rationale was that the bond issue
was all to the good; that there was no bad aspect to any
of it. And since there never seems to be anyone
representing the general taxpayer interests, there was no
substantive debate about the proposition. Still, it is a
proposition that will add about 6 percent to the state
debt, which is already one of the highest in the nation
at $48 billion.
Supporters of this popular spend-money-hand-over-fist
proposition werent interested in that. Time and again
they made the same arguments in the mass media.
The bond issue would provide projects in the city,
primarily controlled by Democrats and liberal
Republicans. And there would be plenty of leftover pork
for upstate, generally a GOP region. For upstate, there
was money for roads. For New York City, there was the
promise of new subway lines. There was plenty of pork to
go around; that was the implied message. The project was
just about equally divided between upstate and downstate,
between mass transit and roads, between a gang of
Republican pirates and a gang of Democratic
pirates.
The bond issue, wrote the New York
Times in what appeared to be a mainstream voice,
has the support of [state] Comptroller Alan Hevesi,
the states fiscal watchdog. It represents a
prudent straightforward and transparent strategy.
The city comptroller also endorsed the bond issue. The
major mayoral candidates disagreed with each other on
myriad matters except on one: They agreed the bond issue
should be approved.
Pamphlets for the bond issue promised hundreds of
millions of dollars for New York Citys infamous unbuilt
Second Ave Subway. This leviathan literature never
mentioned a painful fact. A bond issue had been approved
in the 1950s to pay for the Second Avenue Subway. But
here was a project that was actually expected back in the
1940s. Thats when the city took over the last privately
managed el lines, promising to save the nickel fare at
the same time the system was expanded and modernized.
Since then, the system has contracted, ridership levels
have declined, and the fare has been raised many times.
But what happened to the bond issue approved in the
1950s? It had to be spent on other things because the
subway system constantly ran in the red. Oh, sure, Mayor
John Lindsay of New York City, along with many other
politicians, actually helped break ground for the Second
Avenue Subway. But that was about 35 years ago and the
project is nowhere near completion! How many times will
taxpayers be asked to pay for the same project?
Still, bond-issue supporters this year, who never spoke
about history, kept hammering home that this would be a
great thing. Who could say no to all these wonderful new
projects? Every major politician from Republican Michael
Bloomberg to Democrat Hillary Clinton said the bond issue
was fabulous. And beyond these projects, there was the
classic promise of big government that more
government spending will create more jobs.
Over 120,000 new jobs across New York State,
was the promise of supporters of Proposition Two. Was
there no one who thought running up some $3 billion more
in debt was not a good idea?
Yes, but as a citizens group, a group with little pull
in the major media and without a special interest, its
opposition voice was hardly ever heard.
The overriding consideration for the Citizens
Budget Commission [CBC] is the high level of state
debt, said Elizabeth Lynam, the groups research
director.
The CBC, a nonpartisan group, opposed the bond issue.
We found that New York state has $10 billion more
debt than it should. The state debt should be reduced,
not increased, according to Lynam. That
statement of excessive debt levels could apply not only
to the federal government but also to most other levels
of government in the nation.
Proposition Two won easily. It was never much of a fight.
CBC was gallantly battling against a category 5 hurricane
called the Leviathan.
More spending is the apotheosis of government today,
tomorrow, 35 years ago, and 35 years from now. Yet
drunken-sailor spending has been the road to ruin for
almost every republic in history. More spending is the
mantra under Republicans, under Democrats, and all the
rest of those who feel compelled to make endless
impossible political promises, from George H.W. Bushs pledge not
to
raise taxes to Bill Clintons
middle-class tax cut. It is the nature of government all
government.
It is why we always seem to get more debt and government,
despite voting for countless politicians who campaign
against big government and then govern as though a
socialist government was elected. It is an American
update of the famous British liberal leader of the 1890s,
Sir William Harcourt, who said, Were all
socialists now.
It is why strict spending controls, incorporated into
constitutional amendments, appear to be the only way to
stop our governments seemingly permanent spending
rampage.
I always vote against bond issues.
Gregory Bresiger is a business writer living in Kew Gardens, New York. Send him email.
|