Chris Saxman: Cold Fusion Friday
Consider these facts – his numbers are up – mid 50s in polls that sample everyone and upper 40s with LIKELY VOTERS. His negative numbers are less intense that just four months ago. That and the GOP needs to win ALL of the following states to get to 270 – Florida, Ohio, Virginia, North Carolina, Indiana and Colorado. Good luck with that.
The upcoming State of the Union (SOTU) by the President of the US (POTUS) will be laundry list designed to lay the groundwork on the 2012 re-elect. Very specific issues that test poll well will be woven in with the larger themes of bipartisanship, working together and getting things done for the American people. Cue the Chris Matthews thrill up the leg moment…
My question is – how many Supreme Court justice post for the speech after being blasted year for the Citizens United decision DURING the SOTU? I put the over/under on that at 5.
Here in Virginia, Governor McDonnell has proposed a $4 billion road construction program with specific projects being funded. Naturally, those supporting it say thanks but it doesn’t go far enough and those opposing got the vapors because it uses debt. Oh, it’s a bond package. $4 billion. Now, when people buy a house, do they pay cash or do they go to the bank for a mortgage? 10 year, 15 year or 30 year mortgage? But the big question always is – what rate did ya get?
When it comes to public financing of infrastructure no one ever asks the terms of the debt. They simply reply “you’re mortgaging the future of our children!!”. Usually on 10 -12 or 15 year notes with rates below 5%. As bond rates go up, that makes the debt more expensive. But how does a 10 year note mortgage the future of an 8 year old? At 18 they drive to college on safer roads to a new college dorm or classroom having just finished a K-12 education with a recently renovated high school. Suffocating…
This is not to say that debt is neither all good nor all bad. It is relative.
But also consider right now that, in Virginia, it is the stated policy of the Commonwealth having been voted into existence by the legislature in 2002 with House Bill 1285 and signed by Governor Warner. Don’t recall that little nugget? No one does. Heck, I had to surf the General Assembly website to find it. I wonder who voted for THAT and now opposes the Governor’s package?
That bill states that the financing policy of the Commonwealth is basically this – below 5% revenue growth and capital projects should be financed with bonds, between 5-8% growth – a mix of cash and bonds and above 8% revenue growth – all cash. Only two negative votes on final passage and one of those guys is no longer in the House. So, only one legislator serving today voted against HB1285. Who dat? Lee Ware – man among men.
Keep in mind also that the Constitution of Virginia states that no more than 15% of General Fund obligations can be used for debt payments and that the internal, unwritten cap is actually 5%.
The rating agencies have said this package will not jeopardize the AAA rating of Virginia’s bonds. Not that rating agencies have a better record than my NFL picks last weekend, BUT I think they know more about bond financing than most people commenting on the package offered by the Governor.
But if you want to have some fun – after someone praises or decries the bond package, or any bond package for that matter – ask them this question – “That’s interesting. Can you tell me what the rates and term of the debt is likely to be when they go to market with the package?” There will be more glaze over those eyes than a Christmas ham.
Speaking of the NFL – I am 4-3 in the playoffs. Picking the Steelers to beat the Jets – Troy Polamalu is going to play and they are 16-4 with him in the lineup over the last two years. The Steelers also have three really fast WRs who can get behind the secondary of any team. The defensive coordinator of the Steelers, Dick LeBeau -living legend, will draw up a plan that should shut down Mark Sanchez – the average QB of the Jets. Namath he ain’t.
Picking the Packers because they are playing well, have a great quarterback and receiving corp. But mainly because one of my best friends is a Packers fan and I would like us to finally have a Steeler-Packer Super Bowl.
Sound like a dumb reason to pick a game? It’s not like I am actually using my money and mortgaging the future of my children.
Can’t say the same about our federal government and their friends in lower Manhattan….
p.s. Who do I thank for the Hollywood award shows which remind me I don’t need to go to the movies?
p.p.s Who do I thank for all of those commercials that show men to be worthless, overweight dipwads which really help me cross that company off my “will buy from them in the future list”?
p.p.p.s (last one) – do you realize our cultural representations of the American male have gone from Robert Young, Ozzie Nelson and Ward Cleaver to Archie Bunker, Al Bundy, Homer Simpson and today’s characters whose names you probably can’t even recall….
Column by Chris Saxman