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Rod BoshartRod Boshart has been The Gazette’s Des Moines bureau manager since 1989 covering state government, the Legislature and political campaigns [...] |
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Iowa ranks second for per-capita public debt
DES MOINES – Former Gov. Terry Branstad’s campaign Tuesday accused Gov. Chet Culver of using a “sleight of hand” to deceive Iowa voters by touting a low ranking for public debt that pre-dated Culver’s I-JOBS borrowing.
Culver’s office issued a news release Tuesday trumpeting the fact that Iowa placed second lowest nationally in per-capita state debt in a new report from Moody’s Investors Service. Moody’s noted that Iowa’s public debt equated to $73 per person for money borrowed to fund infrastructure needs while nationally the per-capita average was $936.
“We are weathering the economic downturn and natural disasters of the last few years extremely well when it comes to government debt in Iowa,” Culver said in a statement. “Even after bonding for desperately needed infrastructure investments through I-JOBS, we maintain one of the lowest debts among states – a testament to our very careful and cautious budgeting and spending practices in this state.”
Jeff Boeyink, manager of Branstad’s 2010 gubernatorial campaign, said the report gave a “significantly distorted view” of Iowa’s debt situation because it pre-dated legislative passage of a public infrastructure plan Culver proposed that will boost Iowa’s debt by $1.7 billion over the life of the bonds once full implemented – a long-term borrowing that would equate to more than $500 per Iowan for a state with roughly 3 million people.
“Just like he tries to mask his big spending increases in the state budget by not counting the use of one-time revenue sources and the use of reserve funds, Gov. Culver is happy to use this sleight of hand in reporting Iowa’s debt burden to further deceive Iowans about the true cost of his massive borrow-and-spend programs,” Boeyink said.
House Republican Leader Kraig Paulsen of Hiawatha said he was disappointed that Culver and his staff would attempt to mislead Iowans by highlighting Iowa’s low-debt standing in fiscal 2009 comparisons based on a public debt of about $219 million that did not reflect the $600 million in borrowing that took place last summer in the first round of the overall $875 million I-JOBS program. He said they were either intentionally trying to mislead Iowans or didn’t understand the numbers, something he found to be disturbing whichever was the case.
Senate GOP Leader Paul McKinley of Chariton said Culver was demonstrating how out of touch he was with economic realities by touting an outdated and incomplete analysis, adding the “campaign-style charade is exactly why Iowans do not trust Gov. Culver’s I-JOBS numbers (and) they do not trust his budget numbers.”
State Treasurer Mike Fitzgerald, a Democrat seeking re-election to an eighth term, said even with the I-JOBS borrowing included Iowa would rank 44th among U.S. states for per-capita public debt if none of the other states took on more debt, which has not been the case given the financial pressures facing many state governments.
“The Republicans are trying to say, hey, wait a minute, we’re going into debt and that’s irresponsible,” Fitzgerald said. “But yet, Branstad went into debt, too. He borrowed for the fiber-optics network. He did cash-flow borrowings just to pay our bills on time, he borrowed for the underground storage tanks and he borrowed for some prisons around the state.”
The state treasurer said Iowa continues to be a low-debt state and currently has the top bond rating of Aaa, which makes it an ideal time for the state to borrow to make infrastructure upgrade and disaster recovery repairs given that interest rates are low. He noted that the bonds are being repaid at $43 million a year from gambling profits to the state, not tax money.
Comments: (515) 243-7220; rod.boshart@gazcomm.com
The piggy bank has been broken open. There have been massive future obligations accepted. Go to Morris Plan, or raise taxes? Who cares? It all happens after election day.
whats a Morris Plan?
A bank of sorts in Cedar Rapids. Perhaps before your time.
bet the states with the lowest debt are also the most white
H-m-m-m, according to the headline alone, I was expecting to read it was second highest.
Very misleading headline.
Shows Culver doing good for the times.
Что-то такое слышал, но не так подробно, а откуда материал брали?
AIG, Fannie Mae and Freddie Mac had Aaa bond ratings too. I geuss their rankings were a tad bit misleading as well. No wonder the guy (Democrat Treasuer Fitzgerald) who lost over half a billion of IPERS money recently, is saying we arent really in debt. Clean house.
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It was a local (CR) loan business that was pretty successful for many years. It got into trouble in the late 1970's and folded, wiping out the investments of many local shareholders, who were attracted to it because it offered higher rates of return than mainline (FDIC) banks.
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Once again we have an example of a Gazette headline leaving the opposite impression of the article content. Headline should not imply we are second (and so nearly highest) when we are second LOWEST. I've been caught on numerous headlines over the years where the expectations they elicit are false.
Should I also mention here my dismay with the fact that one can no longer find the basic facts in the first paragraph or two of an article, with subsequent text filling in more details? Heck, sometimes we must make it to the last sentence to get the general picture. Journalism has changed…
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