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Kilmer’s plan: Ingenious job creation in hard times

Post by TNT Editorial Board / The News Tribune on Jan. 28, 2012 at 6:48 pm with 3 Comments »
January 27, 2012 6:50 pm

This editorial will appear in tomorrow’s print edition.

A genuinely good idea tends to pop out from among the nondescript crowd of been-theres and done-thats. State Sen. Derek Kilmer’s proposal to create jobs without new taxes looks like that kind of idea.

The Gig Harbor Democrat – an economic development specialist who plays down his Oxford doctorate – knows that government best builds the economy by building infrastructure. Such things as sewers, water lines, highways, ports, schools – the necessary foundations of private businesses.

With tentative support from both Republicans and Democrats in the Legislature, Kilmer is proposing legislation that would – this gets complicated – finance major job-creating projects with bonds backed by tax revenues already flowing into two existing state funds.

The funds pay for major public works improvements and environmental protection projects. They are replenished with taxes collected from utilities, solid waste operations, and companies that market pesticides and other hazardous substances.

Kilmer would divert relatively small side streams from those incoming taxes to finance revenue bonds that would immediately raise hundreds of millions of dollars for projects already planned but not yet funded.

Port improvements and short-line railroads that could expand state exports, for example, or restoration of polluted Tideflats land that companies would love to move into.
The idea would simultaneously deal with multiple issues:

• Unemployment and recession. The construction work would create temporary jobs; more important, the completed infrastructure would help spawn private investment and permanent jobs.

• State debt. Washington’s stricken operating budget is saddled by interest payments to the tune of $1 billion a year. The Legislature cannot afford more general obligation bonds, but Kilmer’s revenue bonds would not impact the operating budget.

• Construction costs. In boom times, when the state can best afford to invest, labor is tight and supplies are expensive. In bad times – when the state can’t afford much – labor is plentiful and costs are lower. The revenue bonds would let the state buy construction when the price is right.

• Interest rates. They are extraordinarily low now; they’ll only get higher as projects wait for conventional funding.

• Long-term jobs. This isn’t spending for the sake of paying construction workers; the idea is to create permanent infrastructure – including classrooms – to help the economy flourish in the future. The immediate construction work is a sweet byproduct, though.

Jobs. No new taxes. Economic stimulus. Historic bargains on construction. It’s hard to see a downside here.

Leave a comment Comments → 3
  1. raulwaldon says:

    That’ what High Speed Universities is all about, to further the education of students. They need more than a high school degree today, they need at least 2 years of college, preferrably 4, and then we’re going to work with communities so they can grow economically and create more jobs for our young people

  2. PumainTacoma says:

    Your genius boy stated in 2010 that the recession was over. But he is the genius while private sector Puget Sound citizens told him he was an idiot.

  3. BrodheadforCongress says:

    Wow,

    Der Bureaucratic Socialist Derek Kilmer wants to finance infrastructure with more bonds? Look around you. How many commercial buildings are empty???How many residential properties are in foreclosure? Have you looked at how much property tax has risen while residential property values have plummeted to 1995 levels? But still, property taxes are higher than ever. Now you clap and call Derek Kilmer a genius for supporting more spending, and more debt???

    The normal ebb and flow of private sector behavior will dig us out of the economic mess in a few short years. All the folks that lost houses in bankruptcy will start to get their 7 year credit issues back together. So, in 2013 or so, many folks will have good credit once again. They will have the opportunity to buy Tacoma real estate at bargain basement prices and 5% interest rates. A real estate boom is when a market increases by 10%. We will see a real estate market boom starting very soon. In addition, given that Bernanke and Obama can’t borrow more money from China for a while, hence, they will quantitative ease another 10% of GDP this year, print money from thin air, raise the debt ceiling twice in one year, and slip the bill to our children. My IRA paid .15 percent interest last year. That’s 48 cents for $5000 after a service charge. Given the debt and the instability of the Stock market, the FED will not raise interest rates because it will perpetuate a flight from the Stock Market. Our money is worthless. The entire structure of government spending is dysfunctional. Derek Kilmer simply stands for more debt.

    Derek Kilmer suggesting that we take on debt to fix so-called infrastructure is flawed. In addition, it will burden the tax base at a time when we need to curtail spending. As you recall, the Washington State government expanded its budget with the rise of real estate prices and predatory lending. They have yet to deal with the massive spending increases while the rest of us tighten our belts. It was during the time of Kilmer that we saw our sales tax increase by 2%. It was during the time of Kilmer that we saw our property values increase by 20%. Now the Muppets at the Tacoma editorial board are serenading Kilmer for pushing more debt and more obligations? What Star are you on?????

    I would expect more commonsense from an Air Force Brat, and a Mid Westerner. Oh by the way, The Kansas City Chiefs suck….I look forward to seeing the Broncos win at Arrow Head this year…
    People will not spend money until Obama is out of office. Americans have lost faith in Obama. They have lost faith in Derek Kilmer. Americans are tired of folks with zero private sector experience spending our money and borrowing money for special interest. Americans are tired of special interest backed politicians dreaming up bond, tax and spend schemes and slipping the bill to our children. Kilmer’s British trained socialist policies are counter to the fundamentals of Private sector dynamics. His plans will provide long term debt with short term economic impact. We saw this with the Stimulus bill. We will see the same with Kilmer’s British Labor Party style bond ideas. Again, he has never ran a business or made a payroll. He doesn’t care about our sales taxes rising or our property taxes rising. At the Federal level, he would be the guy that votes to raise capital gains, income taxes, and gut the military. He would just be a patsy for Harry Reid and the bankrupting of the American dream….Just say no!!!
    In just a few years, 10 million boomers will retire. Hundreds of thousands of Americans will regain their credit score and start buying houses in Tacoma. They will buy housing that is pennies on the dollar compared to 2006. They will get interest rates that are less than 5%. If property taxes remain low, more money will be available to fuel the Puget Sound economy. We will enter a great boom cycle with low unemployment. It’s just around the corner. Our boom cycle will be better than 1990, and will restore home values and tax base. Kilmer doesn’t understand our economic cycles. All he understands his how to spend other people’s money like some sort of British trained Parliamentarian labour party elitist with zero private sector experience and a pipe dream.
    As far as the TNT editorial board and this article, this is an insultingly vague and lazy piece of writing. It stinks of liberal leaning content less gibberish from someone who has lost interest in journalism or stayed up to late……Give me a break!!!

    http://www.BrodheadforCongress.com

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