SC Governor Sanford says no thanks to bailout
When the nation's governors met with President-elect Obama this week to talk about a bailout of state economies, most of them voiced support for the plan, with one vocal exception. South Carolina Governor Mark Sanford. At the South Carolina State Capitol building, Governor Sanford's office is on the ground floor. Just upstairs, the General Assembly meets. There are hundreds of General Assembly members. But Sanford's he's never been afraid to take them on, and he's known for prolific vetoes of the budget. He even brought pigs to the Capitol once to protest pork spending. So this latest effort of his isn't much different from his standard practice here in South Carolina. It's just on a bigger stage. "Ever so respectfully, I laid out my case to the President-Elect as to why I didn't think it was a good idea," says Sanford, describing his meeting with President-Elect Obama and governors of 49 other states. Sanford was virtually the only Governor in that room with the President-elect asking him not to a check for his state. Most of his colleagues - including North Carolina Governor-elect Bev Perdue - are eager for the federal government to spend billions of dollars on unemployment benefits and state infrastructure. Perdue's gone so far as to start lining up support in Washington in case the plan passes, "because if there is a public works package, I intend for North Carolina to have more than our fair share." But Sanford - who was a real estate developer and Goldman Sachs investor before becoming a politician - believes the bailout for states is basically just paying for debt with more debt. "People believe there's a giant Santa Claus in the sky and he lives in Washington D.C., and he's going to send us a check and it won't cost us anything," says Sanford. "I think we're on a very scary path, with regard to the tax load, not just to us, but to our kids and grandkids." So he's marching back and forth to Washington chastising the nation's leaders for bailing out banks and even considering a bailout for the auto industry or state governments. And it's not as if South Carolina's rolling in cash. Tax revenues are way down. State legislators spent weeks in special session recently making painful budget cuts. Many of those lawmakers, including Democratic State Representative Joe McEachern, think Sanford may be a little to quick to turn away federal help. "I mean you don't want to penalize your state when they could benefit from it," says Representative McEachern, a Democrat from Richland, South Carolina. "So I think he need to wait and see exactly what the proposals are." But rather than send bailout money, Sanford believes South Carolina would fare much better if the federal government would just ease up on the number of expensive programs it requires states to operate. Further more, he says states need to own up to their excess spending and follow South Carolina's lead. "Our spending's clearly not been sustainable, which is well evidenced by the fact we had to go and cut 500 million dollars worth of expenditure," says Governor Sanford. "And we're destined to cut more. In some cases they've been harmful to people who have been served by government. In some cases they've been harmful to people who have worked in government. But the issue is, we've actually gone through and made the cuts." He says too many states have not taken their lumps, and now they want taxpayers everywhere to pay the tab. That's just not fair, says Sanford. Even it if means more pain for the people of his own state, Sanford is adamant that governments need to accept the consequences of spending too much, too fast when times are good. "I've sounded like a crazy man at different points over the last five years warning about this stuff," says Sanford. "This is why you put hay in the barn when you're raising cattle and winter's coming. This is why the Bible talks about seven skinny cows and seven fat cows coming out of the Nile and the whole notion of preparing for the lean years." Sanford has so completely embraced his role as "I told you so" that he's taken to publishing strongly worded opinion pieces in the Wall Street Journal warning about a "bailout mentality" and "burying future generations under mountains of debt." So does that mean he'll be sending back the check if a bailout package does pass? Not exactly: "That's not where we are right now," he says. "Where we're at now is trying to impact the policy that comes down to the different states. We'll cross that other bridge if and when we get to it. I'm gonna do everything in my power to try and slow this thing up because of the harmful impacts it'll have to economy in the long run." Sanford vows to keep making his point as loudly as possible - and he's probably got a few more inflammatory opinion pieces up his sleeve. But there's so much momentum for a state bailout right now that Sanford's plan is a little like stepping in front of a train with a megaphone.