How are you? It’s been awhile. We haven’t talked since session. Remember our talk about Tax Increment Financing (TIF), that cool thing that allows local government to borrow money for public infrastructure then pay it back with the increases in value that creates?
Oh, and before that we were talking about Referendum 52, a smart, conservative increase in the state’s debt limit to improve energy efficiencies in schools. I called that Green Increment Financing because the same principle–using money saved from energy efficiencies to pay back money borrowed to make those efficiencies–reminded me of TIF.
Sadly you hate both. Some y’all don’t like debt because it’s a good political issue. Ma and Pa Kettle are at home saying “by God if we’ve gotta live within OUR means then so should the gubmint!” Bashing debt and taxes is a good vote getter. Never mind that most Americans don’t “live within their means” and borrow a lot. It’s hard to by a car and a house with cash. But logic doesn’t always work.
But I’ve got good news! Remember how you said that goofing around with the debt limit would hurt our credit rating? Some of you didn’t even want to use Qualified Energy Conservation Bonds (QECBs) because they would would hurt our credit rating. Well it looks like the rating agencies think you don’t know what you’re talking about. Moody’s (a great name for a rating agency) thinks we shouldn’t even have a debt ceiling!
If Moody’s thinks that the uncertainty created by bickering over a basic function of government like borrowing money is important I think you should listen. As it turns out, the economic mess we’re in is made worse, not better, by bickering over debt. Jobs, economic development, and investing in the future of government itself is LESS risky than the possibility we might borrow too much.
So, please, when we talk about debt for TIF or GIF we’re talking about a wise investment, not charging up the credit card for margaritas and beer. Government and business need debt to function. Playing politics with it is a bad and (according to Moody’s) risky practice.
Debt and Tax Lover
(and Up zone Cheerleader)