Monthly Archives: August 2010

Public Works Projects: Can Taxpayers Afford To Allow Government To Control Spending Without Accountability?

The “Biggest Little State in the Union” is in the final stages of the relocation of Interstate Route 195. The Iway is a short stretch of highway that passes over the Providence River, and is easing the traffic congestion that plagued commuters between the West Bay and East Bay of the state for years.

Last night, as I was zooming across the new “Iway” bridge, I found myself admiring its design; the internally illuminated concrete piles, the arches (that seem to be the same color as the garages at the house where I grew up,) the suspension cables, and its over-all smooth-ness. There aren’t potholes or big bumps to jar ones passage across the Providence River as had become the norm with the old Providence River Bridge. Perhaps it was my imagination, but even the road surface material seemed to be quieter, surreal.

Alas, that was then this is now. This morning I decided to skip the gym and, while the weather permits, read the ProJo Online with a cup of coffee on my deck. Much to my chagrin, I read that the cost of relocating route 195 is already more than double from initial estimates and the project won’t be completed until 2012. That is a swing from $299 million in 1993 to a whopping $758 million today and the initial estimate accounted for inflation. One would hope that there are people much smarter than I am who cost these things out at the outset. In commercial real estate we use a Pro Forma to determine the feasibility of a project/venture so there aren’t any surprises and the developer/owner doesn’t run out of money. Try to imagine the developer of a housing development, an office building or retail plaza going back to the lending institution every year or so asking for additional funds to complete the initial project. We have all seen enough unfinished housing developments and commercial buildings sitting vacant to know that lending institutions won’t hesitate to kill funding on a poorly managed/executed construction project. It is not so easy with Public Works Projects. We can’t have unfinished bridges, roads, sewers etc because the public welfare and safety depends on these projects.

What can we do? For sure there is no easy answer, but we need to address the fiscal irresponsibily of governments because we are at, or quickly approaching, the “tipping point” where our society just cannot afford more taxes without permanently handicapping the economy at-large. Every dollar that is paid in taxes is one less dollar that can be spent on breakfast in a local coffee shop, or on a bouquet of flowers, or dining out, or attending local theater. The segment of society that “feels it most” could be those that can afford it least – those with lower income. They may not pay income taxes but they pay the onerous gas tax every time they fill-up, and other “sin taxes” when they buy a six-pack of beer, or a pack of cigarettes…and these monies are continually squandered by the politicians who control the purse-strings of government. Why do the Gas Tax and other “road taxes” often go into the General Fund and not remain earmarked for transportation issues? Why aren’t monies received from liquor and cigarette taxes earmarked for healthcare/Medicaid? Monies received from specific sources should be disbursed for corresponding specific uses. This would force our politicians and the bureaucrats to be responsible and accountable with our money. There would be no General Fund “black hole” sucking in these revenues to be lost and only to resurface as some pet project or other pork-barrel spending.

So as we approach the Primary and then the General Election, pay attention to what the candidates say, and what the politicians have done. This is the only time the citizenry has a voice. We need to speak with a voice that is loud and clear: “We are not going to tolerate, nor can we afford wasteful spending.” Don’t forget to vote.

Thanks for stopping by.

May You Be Healthy, Wealthy, and WISE

Double Dip Recession Or Two Scoops Of Optimism?

We have been hearing a lot lately about the possibility of a “Double Dip” recession lately from President Obama on down to local news reports. It seems like Economists, Prognosticators, Politicians (I know, what do they know) Pundits, Talking Heads, and every other “Tom, Dick, and Harry” seem to have an opinion on the status of our Economic Recovery. What I have found, empirically and anecdotally, is that there are multiple “right” answers to the question.

Many “Leading Indicators” foretell a path to recovery, but there are certainly many statistics that one could cite which inidicate that we are at the beginning of a steep, and/or long, decline. What I have observed is that both may be occurring at the same time; it depends on the “when and where factor” when the number measurement was taken and where you are – your perspective. There certainly are indications that our economy is improving – GDP Growth, Industrial Output, and Retail Sales are all up, but Diesel Fuel Sales have stalled1, our National and Trade Defecits are at records levels, and the number of Americans receiving food stamps is expected to rise from 40 to 43.3 million in the next year. Perhaps, what matters is how each one of us individually is impacted. Personally, I know individuals who are doing quite well financially, in a lousy economy in a state with one of the highest unemployment and foreclosure rates in the country; and others who are unemployed, under-employed, or whose businesses are struggling. Believe me; both groups have a different take on the state of our economy. These are people who work hard, work smart, and are resourceful – but with different outcomes.

Does it matter if the economy is up or down? As I write this I am watching numerous different breeds of birds “attack” bird feeders, fending off rivals to take advantage of an opportunity for an easy meal. If food is scarce or in abundance elsewhere in the neighborhood doesn’t matter. They are all amply fed now, as they have been for years; by the bird feeders. If the bird feeders disappear these little feathered friends will do what’s necessary to survive. Until then, they make sure they eat what they can to remain healthy and strong. Maybe there’s a lesson to be learned from these finches, hummingbirds, woodpeckers and sparrows. Double dip recession or two scoops of optimism? Who cares! Let’s just do what we need to do… and cherish each day as we do it.

1UCLA-Ceridian Pulse of Commerce Index

Thanks for stopping by.

May You Be Healthy, Wealthy, & WISE.

Congress Needs To Act To Ease Credit/Lending For Challenged Commercial Markets

Jim Helsel, the Treasurer of the National Association of REALTORS® testified before a House Panel on July 29th. He stated that a strong commercial real estate sector is vital to millions of U.S. jobs and helps keep the national economy afloat. Perhaps the esteemed members will listen to testimony “from the trenches” of small business. Tax credits and assistance to hire employees are of little value if there is no capacity to retain them. Businesses need access to capital when cashflow slows to maintain or increase inventories, acquire other businesses, or for new construction. Small business vitality is what would help “prime the pump” of our economy; it needs to grow from the bottom up, not the top down. Lending institutions are relucant to lend because of the presence of “Big Brother” and restrictive regulations.

Congress has acted to help address the situaton; the Small Business Lending Act of 2010 is greatly appreciated but we need more. We are not asking for money, or tax breaks; rather small businesses need access to capital (which is not a “handout” from the government) for QUALIFIED business borrowers. Hopefully they will hear us and respond positively.

Thanks for stopping by.

May you Be Healthy, Wealthy, and WISE.

Happy Monday! How Positive Is Your Attitude?

Welcome! This is my first entry in my new Blog. Hopefully this Blog over time will pique the interest of my friends, colleagues and business associates so that you will continue to stop by to read and perhaps leave comments.

In today’s 24-hour news cycle, we are continually bombarded by information: sound bytes, financial data, news images, and plain old chit-chat from friends, family, and clients. Unfortunatley, much of what we are bombarded with is negative. Politicians complain about the other political party, economists and pundits drone on about the “worst economy in dacades”, friends/family/clients complain about one thing or another.

Yet, in the face of all this, it is important that we remain positive and upbeat. It is challenging, because we all have, or know someone who has, to overcome difficult circumstances. Brian Tracy, the Self-Help author, advises us to avoid the bombardment of negative information. We must stay positive by being positive; and surround ourselves with positive people. According to Mr. Tracy, the most powerful influence n your attitude is what you say to yourself and believe. Personally, I have found this “Self Talk” to be a great first step because it is not dependent on someone or something else; I have complete control over my thoughts and attitudes. Besides, it simply takes too much time and energy to always debate people with a negative outlook. Many people engage in physical activity to stay focused on what’s important; others attend religious services, read or do some combination of the above. I would like to close with a quote from Abraham Lincoln “Most folks are as happy as they make up their minds to be”

What works for you?

Thanks for stopping by.

May you be Healthy, Wealthy and Wise.