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Commentary:Growing Poorer IIBallot initiative will hurt PA business climateby Lowman S. Henry, CEO The name has a mom and apple pie sound to it, but do not be fooled by the so-called "Growing Greener II" initiative that will appear on the May 17th Primary Election ballot. It is just the latest in a growing line-up of big government-style borrowing projects that Pennsylvania taxpayers can ill afford. Voters statewide will be asked to approve a $625 million bond issue that would be used for such nice sounding projects as open space and farmland preservation, mine reclamation, preserving state parks, and a variety of other environmental purposes. Many of these projects, to some degree, are worthy. But, given the fact the Rendell Administration has raised just about every fee and tax imaginable, if these environmental projects are so important why wasn’t money placed in the state budget to pay for them rather than plunging the commonwealth further into debt? The Rendell Administration has been on a borrowing binge since the moment it took office. First, there was the $250 million borrowed under Growing Greener I for “investment” into water and wastewater infrastructure projects. Then, there was the nearly $2 billion borrowed last year for “economic development”purposes. Now comes another $625 million for Growing Greener II. As voters decide how they will cast their ballot on the Growing Greener II question, they should keep in mind the cost of such borrowing. As a general rule, for every one dollar borrowed taxpayers will have to pay back two dollars to cover fees and interest on the debt. These costs make such bond issues poor investments. A pay-as-you-go system would just about double the money that actually goes to the project involved. Proponents also like to pretend taxpayers won’t actually have to repay the money. In the current instance, the Growing Greener II bond issue would be repaid by higher tipping fees on trash dumped in landfills. The average homeowner will see little increase in his or her monthly trash bill. But the cost to manufacturers and business will be high, and will ultimately be reflected in the price of goods produced in Pennsylvania. Our state’s business climate is already expensive and uncompetitive. Adding the financial burden of Growing Greener II to the cost of doing business here will help undo whatever small amount of good last year’s $2 billion economic development bond issue may have accomplished. These conflicting policies are a prime example of what is wrong with Pennsylvania’s fiscal policies. Policymakers in Harrisburg simply do not understand that they cannot tax and spend our way to prosperity with economic development grants. What must be changed are the underlying tax, labor, and regulatory policies which cause our state’s economic climate to rate near the bottom of just about every economic index imaginable. Plunging the state another $625 million in debt for Growing Greener II only takes Pennsylvania’s business climate further down the path of ruin. To be fair, Ed Rendell said during his campaign for the governor’s office that Pennsylvania’s debt load was “too low” and there was room for substantial borrowing. He has made good on his pledge to increase our debt. Unfortunately, our children and grandchildren will be paying for his largess. That leaves us to wonder why Republicans in the General Assembly have gone along with all this spending and borrowing. Republican votes helped to pass the second-largest tax increase in state history in December of 2003. Republican votes moved the economic development bond issue, and the Growing Greener II bond issue onto the ballot. Apparently neither party is willing to stand up and say “no” to the spending interests. Therefore, it is up to voters to put the brakes on Harrisburg’s spending orgy. The time to start is on May 17th by voting “no” on Growing Greener II. That will send a message to Governor Rendell and to the General Assembly that they need to live within our means, and to stop mortgaging Pennsylvania’s future.
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