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Name:Michael Patrick
Location:San Jose, California, United States

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Wednesday, June 15


Running Up Bond Debt: A Means for What End?

I find our governor's attitude toward issuing state bonds frustrating. He advocates for using bonds just to finance the state's debt, as in the case of 2004's Proposition 57, which defers full repayment of resulting debt ($15 billion plus interest) for a decade. But issuing bonds to complete much-needed physical infrastructure projects he considers reckless borrowing:

[State Senate President] Perata envisioned [his proposed $7.7 billion bond for statewide road and bridge improvements] as supplying $1.4 billion for the new [Bay Bridge] eastern span. It could also be a fallback in case the Bay Bridge costs continue to rise.

Schwarzenegger has been dead-set against the bond -- a spokesman derided the idea just two months ago as a "borrow borrow borrow" plan. [From the Chronicle's June 12 Matier and Ross column.]

So, according to the vision demonstrated by the governor,

  • Californians should be willing to put themselves further into debt with nothing to show for it and without fully repaying it until the mid-to-late Twenty Tens, but
  • debt resulting in lasting, tangible benefits like better roads and bridges is just not worth it.