Excerpts from my 3/26/2014 Yes Weekly Article; "On Medicaid Expansion in North Carolina" ACA, Obamacare, CBO, SGR and the Doc Fix

The problem with Medicaid expansion isn't that the services shouldn't be offered. The problem is recent health care reform didn’t fix the cost issues associated with our nation’s health care system.

Considering how many times the law has been “adjusted” since the Congressional Budget Office’s (CBO) last update, I have found assessing the financial implications of expanding Medicaid in North Carolina difficult.

On March 21, the Obama administration’s Whitehouse.gov stated “the Affordable Care Act (ACA) reduces the deficit, saving over $200 billion over 10 years”.

...But the latest ACA deficit reducing accounting appears to no longer be operable.

The last CBO projections didn’t include changes and delays affecting total cost results instituted after December 2013, including delayed penalty revenues and patients retaining the ability to keep and/or purchase low cost catastrophic policies that were supposed to have been replaced with higher priced alternatives in 2014.

More enrollees signed up for 100 percent subsidized care than anticipated. The Obama administration’s math needed about 40 percent of 18 to 34 year-olds to offset the higher costs of older enrollees. The latest youth number is about 27 percent, and a good chunk might not necessarily be healthy.

According to the American Medical Association, Congress and both Bush and Obama didn’t enforce the Sustainable Healthcare physician Growth Rate (SGR) 16 times at a cost to taxpayers of $154 billion with what’s call the SGR “doc fix”.

The University of Chicago’s Vineet Arora wrote: “Because the ‘doc fix’ costs so much, it was removed from the calculation of the cost of the health reform bill to make it more likely that the [ACA] will pass.”

Former Associate Director of the White House Office of Management and Budget James Capretta wrote “While pushing ACA through Congress, President Obama ... proposed to add [the SGR “doc fix”] to the national debt, but he did not want those costs to count against [the] ACA, because they would explode the myth of deficit reduction. So his solution was to pass the “doc fix” in separate legislation. ...the President’s total bill for health care, with an unfinanced [SGR] “doc fix” shows deficits, not deficit reduction.”

In my view, “Obamacare” is a package of legislation, not just the ACA as has been widely publicized.

A March 2010 letter from the CBO to House Budget Committee Chairman Paul Ryan, Obamacare legislation including the ACA disclosed “enacting all three pieces of legislation would add $59 billion to budget deficits over the 2010–2019 period”. Mr. Ryan hasn’t said much about the issue since. According to opensecrets.org, Ryan’s career to date health industry contributions total $1,636,911.

The health and insurance industry’s large political campaign contribution track record correlates to taxpayer funded subsidized healthcare having the highest price inflation of any sector of the economy since 2000.

December 9, 2010’s SGR “doc-Fix” altered ACA subsidy formulas. If the SGR cut scheduled for April 1, 2014 doesn’t occur, at least $140.4 billion of Obamacare’s expected 10-year deficit reduction math looks to be in jeopardy, as Medicaid payment levels are tied to some Medicare reimbursements and correlated to private health care premiums.

My understanding of CBO rules, is if the SGR repeal becomes permanent, the $140.4 billion then counts as deficit increasing, as opposed to its current state of legal limbo, under which the CBO doesn’t have to score the SGR as a deficit expense. The CBO did not reply to inquiries for comment.

I believe the ACA was passed without fixing what’s broken, but preserved the worst of it, making our fiscal situation even more precarious without public disclosure.

It feels like America’s health and insurance industries don’t maintain high profit margins by providing superior care and/or medicine, but by financing the political process with wealth transferred from patients and taxpayers.

In my view, many Democrats are just as guilty as some Republicans for allowing our health care system to become what appears to be a skimming operation. Some campaign contributions look like legal forms of extortion on the part of elected officials via the SGR “doc fix” among other extensions, as some healthcare and insurance industry donors appear to legally bribe legislators in exchange for artificially inflated taxpayer-funded profit.

http://npaper-wehaa.com/yes-weekly#2014/03/26/?article=2186021
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My last 4 Yes Weekly Articles

ON CRONY CAPITALISM IN GREENSBORO

http://www.yesweekly.com/triad/article-17291-on-crony-capitalism-in-greensboro.html

PAY TO GET PAID AND THE CITY OF GREENSBORO

http://www.yesweekly.com/triad/article-17258-pay-to-get-paid-and-the-city-of-greensboro.html

ON THE STEVEN TANGER PERFORMING ARTS CENTER (GPAC)

http://www.yesweekly.com/triad/article-17227-on-the-steven-tanger-performing-arts-center-(gpac).html

ON GREENSBORO’S CIVIL RIGHTS MUSEUM

http://www.yesweekly.com/triad/article-17199-on-greensbororss-civil-rights-museum.html

A few North Carolina Lawyer Rules

It is professional misconduct for a lawyer to:

(a) violate or attempt to violate the Rules of Professional Conduct,
knowingly assist or induce another to do so,
or do so through the acts of another;

(b) commit a criminal act that reflects adversely
on the lawyer's honesty, trustworthiness or fitness as a lawyer in other respects;

(c) engage in conduct involving dishonesty, fraud, deceit or misrepresentation;

(d) engage in conduct that is prejudicial to the administration of justice;

Rule 8.4 Misconduct

A lawyer who knows that another lawyer

has committed a violation of the Rules of Professional Conduct

that raises a substantial question

as to that lawyer's honesty, trustworthiness or fitness as a lawyer in other respects,

shall inform the North Carolina State Bar or the court having jurisdiction over the matter.

Rule 8.3 Reporting Professional Misconduct

Truthfulness in Statements to Others

In the course of representing a client
a lawyer shall not knowingly make a false statement of material fact or law
to a third person.

...A misrepresentation can occur
if the lawyer incorporates or affirms a statement of another person
that the lawyer knows is false.

Misrepresentations can also occur by partially true
but misleading statements or omissions
that are the equivalent of affirmative false statements.

Crime or Fraud by Client

...a lawyer is prohibited from counseling or assisting a client in conduct

that the lawyer knows is criminal or fraudulent.

...substantive law may require a lawyer to disclose information relating to the representation

to avoid being deemed to have assisted the client's crime or fraud.

Rule 1.6(b)(1) permits a lawyer to disclose information when required by law.

Similarly, Rule 1.6(b)(4) permits a lawyer to disclose information when necessary

to prevent, mitigate, or rectify the consequences of a client's criminal or fraudulent act

in the commission of which the lawyer's services were used.

History Note: Statutory Authority G. 84-23

Adopted July 24, 1997; Amended March 1, 2003.

I believe money is fungible

Fungible means interchangeable.

The word comes into play
when (inter alia) earmarked funds end up in a general account.

These funds are then free to be used for purposes other than intended.

Example: You would like to go on a vacation but you have unpaid car repair bills.

A wealthy uncle hears that you are having financial trouble and sends money to help.

However, he would never have agree to pay for your vacation
–- he’s nice, but not that nice.

Once your uncle’s money is deposited into your checking account,
you are free to spend it as you please.

You then get to pay off your bills and go on vacation.

In essence, you paid your bills (a necessity) while your uncle funded your vacation.

http://blog.mises.org/archives/007321.asp#

Fungibility

Fungibility is the property of a good or a commodity

whose individual units are capable of mutual substitution.

Examples of highly fungible commodities [like oil] 

are ...currencies.

It refers only to the ease of exchanging one unit of a commodity

with another unit of the same commodity.

Wikipedia

http://en.wikipedia.org/wiki/Fungibility

Word for the day: Fungible

If there were far fewer illegal immigrants during the economic turmoil of the 1970’s, should there be more or less anti-immigrant friction as economic volatility and unemployment increases?

Illegal Workers Swept From Jobs in ‘Silent Raids’
 
The Obama administration has replaced immigration raids at factories and farms …with sending federal agents to scour companies’ records for illegal immigrant workers.
 
While the sweeps of the past commonly led to the deportation of such workers, the “silent raids,” as employers call the audits, usually result in the workers being fired, but in many cases they are not deported.
 
Over the past year, Immigration and Customs Enforcement has conducted audits of employee files at more than 2,900 companies. The agency has levied a record $3 million in civil fines so far this year on businesses that hired unauthorized immigrants, according to official figures.
 
What do the worlds religious texts and traditions
suggest the authorities do about illegal immigration?
 
…The audits force businesses to fire every suspected illegal immigrant on the payroll— not just those who happened to be on duty at the time of a raid — and make it much harder to hire other unauthorized workers as replacements. 

 

 
If hiring illegal aliens increases business profitability
at the expense of legal workers
have low skilled immigrant workers
lowered poorly educated American’s income? 

 
…“Instead of hundreds of agents going after one company, now one agent can go after hundreds of companies,” said Mark K. Reed, president of Border Management Strategies…
 
…Employers say the Obama administration is leaving them short of labor for some low-wage work, conducting silent raids but offering no new legal immigrant laborers in occupations, like farm work, that Americans continue to shun despite the recession. 
  

Have overextended unemployment benefits
artificially reduced demand for low paying, labor intensive agricultural work? 

 
…Immigrant advocates said they are surprised and frustrated with Mr. Obama, after seeing an increase in enforcement activity since he took office. “It would be easier to fight if it was a big raid,” said Pramila Jayapal, executive director of OneAmerica, a group in Seattle. “But this is happening everywhere and often.”  

.
 
If you were Superman
what would you do about illegal immigration? 

Julia Preston
New York Times, Saturday, July 9, 2010 

If my theory of relativity is proven successful
Germany will claim me as a German
and France will declare that I am a citizen of the world
 
Should my theory prove untrue
France will say that I am a German
and Germany will declare that I am a Jew
 
Albert Einstein 

  

 

Don’t make bets you can’t afford to lose when confronting an opponent with unlimited resources who can arbitrarily change the rules.

I don't care if I follow your rules, if you can cheat, so can I.

 

 I won't let you beat me unfairly, I'll beat you unfairly first.

 

Ender Wiggin

Fictional Military Strategist

If Social Security taxes were increased in 1983 to ease the burden of a smaller generation tasked with providing benefits to a larger number of longer living elders, why would elected leaders borrow and spend the surplus?

The Treasury Department has for decades

borrowed money from the Social Security trust fund

 to finance government operations.

 

 If it is no longer able to do so

 it could be forced to borrow an additional $700 billion

 over the next decade

 from China, Japan and other investors

 

"Over the past 25 years,

 the government has gotten used to the fact

 that Social Security is providing free money

to make the rest of the deficit look smaller." said Andrew Biggs

a resident scholar at the American Enterprise Institute

 

 "Now they've essentially got to pay their own way

 at least a little more fully..."

 

"Instead of Social Security subsidizing the rest of the budget,

the rest of the budget will have to subsidize Social Security."

 

Recession Puts a Major Strain On Social Security Trust Fund

As Payroll Tax Revenue Falls, So Does Surplus

Lori Montgomery

Washington Post

 

If Bernard Madoff

distributed money received from new investors to older investors,

until there wasn’t enough money to continue,

 does Social Security operate under the same structure

with mandatory participation?

 

If a private financial institution

 were as reckless with its fiduciary responsibility

 as Congress has been with Social Security and Medicare,

 there would be howls of indignation, demands for regulation

 and calls for the resignation and prosecution of those responsible.

 

Arnold Kling

 

Was it justifiable for the baby boom and their elders

to promise themselves tens of trillions of unfunded benefits

like Social Security, Medicare and Medicaid,

for future generations to pay for?

Is Richard Bruce Cheney a War Criminal?

Speaking with a sense of impunity, he casually negated a key line of defense that senior Bush officials had hidden behind for years – that the brutal interrogations were approved by independent Justice Department legal experts who thus gave the administration a legitimate reason to believe the actions were within the law.

However, on Sunday, Cheney acknowledged that the White House had told the Justice Department lawyers what legal opinions to render.

In other words, the opinions amounted to ordered-up lawyering to permit the administration to do whatever it wanted.

Robert Parry

Cheney Admits to Being War Criminal

George Washington
Via Naked Capitalism

How could fiscal 2009’s reported Federal Deficit be only $1.42 trillion if Total Debt increased by more than $1.88 trillion?

Date                    9/30/2008                         9/30/2009

 

Value                    $10,024,725,000,000            $11,909,828,000,000

 

 

 

 

How could the national debt have increased

 by considerably more than...the "deficit"?

  

Simple.

  

Just call the money borrowed from the Social Security trust fund

an "intragovernmental transfer,"

and exclude it from the calculation of the deficit.

 

 Corporate managers have gone to jail for less book cooking than that.

  

John Steele Gordon

A Short History of the National Debt

Wall Street Journal

If a conflict of interest can involve a situation in which a person is in a position to exploit an official capacity in a way that benefits their personal or professional interests…?

[The] complaint against the City of Memphis and Shelby County in regards to the use of public funds for a proposed $250-million arena for the NBA's Memphis Grizzlies was upheld after hearing reports that Chisholm allegedly helped a business partner

pursue the Grizzlies' broadcast rights.

 

Chisholm's business partner, James L. Hudson, is forming a sports broadcasting venture and is seeking the Grizzlies broadcast rights.

 

Chisholm allegedly helped arrange a meeting between Hudson and the Grizzlies ownership team.

 

However, Chisholm's attorney, R. Hunter Humphreys, says …Chisholm was considering investing when she had him write a letter to Shelby County …seeking his opinion on the propriety of her involvement.

  

[Shelby County Attorney Donnie E] Wilson's reply recommended that Chisholm suspend or hold any business dealings …until all votes on the relocation of the team were taken

or recuse herself from the votes.

 

Humphreys says Chisholm is no longer considering joining the sports broadcasting venture.

 

Ragsdale's complaint seeks to remove Chisholm and void the NBA-related resolutions, contracts and agreements in which she voted.

 

Michael Paulk

Memphis Business Journal, August 9, 2001

Does the U.S. Constitution allow the government to require citizens to pay privately held entities for health insurance, and levy fines and/or taxes if they refuse?

The Individual Mandate: An Unconstitutional Exercise of Congressional Power

 

…it is somewhat surprising that little attention has been paid to the critical legal question of whether Congress has the constitutional authority to require Americans to purchase a commodity from a private, for-profit corporation.

 

…A mandate requiring all individuals to purchase health insurance would be an unprecedented form of federal action. The government has never required people to buy any good or service as a condition of lawful residence in the United States.

 

…Article I, Section 8 of the Constitution grants Congress the power “[t]o regulate Commerce with foreign Nations, and among the several States, and with the Indian tribes.” Therefore, in order for Congress to have the authority to require Americans to purchase health insurance, the purchase of health insurance must constitute “commerce” within the meaning of the Commerce Clause. It does not.

 

In 1982, the Supreme Court declared that, in order for a commodity to be considered an article in commerce, it must be capable of being sold. Sporhase v. Nebraska,

458 U.S. 941 at 949 -- 950 (1982). While there is no doubt that the sale of health insurance by an insurer constitutes commerce, it does not follow that the purchase – or more precisely, the failure to purchase – health insurance by a consumer also constitutes commerce. Health insurance, once purchased by a consumer, is not capable of being further sold in commerce because there is no market for it; who would purchase a health insurance policy naming someone else as the insured?

 

…there is no market for health insurance benefits once the policy is issued. No one would buy my health insurance, because no one other than I can derive any benefit from it. Since there is no market, health insurance is not an article of commerce once issued. If it is not an article of commerce, Congress lacks authority under the Commerce Clause to require me to purchase it.

 

…For single-payer advocates, a very powerful argument is that, while the individual mandate to purchase private health insurance is unconstitutional, Congress can lawfully tax to support a government financed health insurance program. Article I empowers Congress to use its taxing powers in support of government programs that foster the public welfare; this is the constitutional authority for Social Security and Medicare. But to extend that authority to requiring Americans to purchase a private commodity raises profound civil liberties issues.  If Congress can compel the purchase of insurance from a for profit insurance company, it can compel the purchase of any commodity if there is an arguable public policy to support it.  The auto industry is collapsing?  Forget Cash for Clunkers, just order Americans to buy cars or tax them if they don't.  Obesity crisis?  Order Americans to join health clubs, or tax them if they don't.  If Congress gets away with this, there is no stopping point and Big Business will have  succeeded in making Americans into involuntary consumers whenever it so chooses.

 

Sheldon H. Laskin

After Downing Street, December 20, 2009

George Hartzman Campaign Finance Reform Flyer

George Hartzman Campaign Finance Reform Flyer

Please print and/or email and distribute.

George Hartzman Campaign Finance Reform Flyer

George Hartzman Campaign Finance Reform Flyer

Please print and/or email and distribute.

Dear Guilford County Commissioners: If taxpayer money is to be used for economic incentives, please prioritize employment growth over development.

Retail vacancies crept up in the quarter to 10.5 percent

from 10.3 percent in the first quarter,

 

Office vacancies Triad-wide were unchanged in the second quarter at 18 percent.

 

In the industrial market,

warehouse vacancies edged higher in the quarter Triad-wide,

from 22.5 percent to 22.6 percent

 

The Business Journal of the Greater Triad Area

August 21, 2009

 

Incentives plan is folly -- and illegal

 

Over the last six weeks, we have read about Guilford County commissioners Vice Chairman Steve Arnold’s new incentive policy, which purportedly will offer assistance to small businesses by rebating their taxes on new and expanded facilities.

 

Arnold’s proposal…violates the basic tenet of taxation in North Carolina: Except under very precise limitations (like returning tax overpayments), rebating taxes in North Carolina is illegal.  Specifically, N.C. General Statute 105380 calls for “No taxes to be released, refunded, or compromised.”

 

…Jonathan Morgan of the UNC School of Government and former N.C. Supreme Court Justice Robert Orr concur that the proposal raises serious legal questions.

 

Novel policy? Trying something that hasn’t been tried before?

 

Sure, no one has tried this methodology — because it’s simply illegal. One or 11 Guilford County commissioners supporting the proposed policy just doesn’t matter and makes it no more legal. Yet, Arnold persists in this quixotic quest to arbitrarily reduce taxes for developers.

 

Developers, you might ask? Yes, precisely.

 

…the development community did not put this proposal forward; it is a creature of the creative mind of Steve Arnold. Arnold has been a developer for years, so he knows exactly who will benefit from his proposal.

 

…this policy would allow huge tax breaks to developers — including those from outside the region and out-of-state developers and builders — for the next Walmart, or CVS drugstore, or the next strip center hosting a tanning salon, nail painting and another Subway restaurant.

 

The sad truth is that this will almost certainly not help the small business itself. It will provide assistance to the owner/developer/builder (i.e., “taxpayer”) of the property, not the operator, except in that rare circumstance they are one in the same.

…These are the people who would get the bulk of the money from the policy: landowner, developer and builder — not the mom-and-pop storefront printer, florist or day care operator whom the proposal purports to assist.  First illegal, now poorly developed and misguided.

 

Arnold knows that rebating taxes is illegal. Guilford County staff told him that repeatedly.

 

...This proposed policy needs to be quickly and thoroughly dismissed.

 

Rob Bencini

Former county economic developer

Consultant in economic development policy

Greensboro News and Record, September 3, 2009

Dear Guilford County Commissioners: If taxpayer money is to be used for economic incentives, please prioritize employment growth over development.

Retail vacancies crept up in the quarter to 10.5 percent

from 10.3 percent in the first quarter,

 

Office vacancies Triad-wide were unchanged in the second quarter at 18 percent.

 

In the industrial market,

warehouse vacancies edged higher in the quarter Triad-wide,

from 22.5 percent to 22.6 percent

 

The Business Journal of the Greater Triad Area

August 21, 2009

 

Incentives plan is folly -- and illegal

 

Over the last six weeks, we have read about Guilford County commissioners Vice Chairman Steve Arnold’s new incentive policy, which purportedly will offer assistance to small businesses by rebating their taxes on new and expanded facilities.

 

Arnold’s proposal…violates the basic tenet of taxation in North Carolina: Except under very precise limitations (like returning tax overpayments), rebating taxes in North Carolina is illegal.  Specifically, N.C. General Statute 105380 calls for “No taxes to be released, refunded, or compromised.”

 

…Jonathan Morgan of the UNC School of Government and former N.C. Supreme Court Justice Robert Orr concur that the proposal raises serious legal questions.

 

Novel policy? Trying something that hasn’t been tried before?

 

Sure, no one has tried this methodology — because it’s simply illegal. One or 11 Guilford County commissioners supporting the proposed policy just doesn’t matter and makes it no more legal. Yet, Arnold persists in this quixotic quest to arbitrarily reduce taxes for developers.

 

Developers, you might ask? Yes, precisely.

 

…the development community did not put this proposal forward; it is a creature of the creative mind of Steve Arnold. Arnold has been a developer for years, so he knows exactly who will benefit from his proposal.

 

…this policy would allow huge tax breaks to developers — including those from outside the region and out-of-state developers and builders — for the next Walmart, or CVS drugstore, or the next strip center hosting a tanning salon, nail painting and another Subway restaurant.

 

The sad truth is that this will almost certainly not help the small business itself. It will provide assistance to the owner/developer/builder (i.e., “taxpayer”) of the property, not the operator, except in that rare circumstance they are one in the same.

…These are the people who would get the bulk of the money from the policy: landowner, developer and builder — not the mom-and-pop storefront printer, florist or day care operator whom the proposal purports to assist.  First illegal, now poorly developed and misguided.

 

Arnold knows that rebating taxes is illegal. Guilford County staff told him that repeatedly.

 

...This proposed policy needs to be quickly and thoroughly dismissed.

 

Rob Bencini

Former county economic developer

Consultant in economic development policy

Greensboro News and Record, September 3, 2009

From the Minutes of October 21, 2008 Greensboro City Council Meeting: “until the economy improves to the extent that the increase in the City’s overall debt is appropriate”

Councilmember Barber moved adoption of a resolution “to delay issuance of the bonds approved by City Council for the 2008 Referendum until the end of December 2009”. Lengthy Council discussion was held with regard to locking future Council action by instituting a timeline; if/when bonds pass, their issuance would be restricted until economic indicators improve; and Councilmembers were unanimous in their concern toward doing what is in the best interest of the public. Councilmember Matheny requested a friendly amendment that removed the date of December 2009 from the resolution and added, “until the economy improves to the extent that the increase in the City’s overall debt is appropriate”.

 

Councilmember Barber accepted Councilmember Matheny’s friendly amendment that “until the economy improves to the extent that the increase in the City’s overall debt is appropriate”. Councilmember Barber moved adoption of the resolution. The motion was seconded by Councilmember Matheny which was adopted on the

following roll call vote: Ayes: Barber, Groat, Johnson, Perkins, Matheny, Rakestraw, Wade. Noes: Bellamy-Small and Wells.

 

252-08 RESOLUTION TO DELAY ISSUANCE OF THE BONDS APPROVED BY CITY COUNCIL FOR THE 2008 REFERENDUM WHEREAS, City Council has approved Bond Orders for submission to the voters of the City specifically Street Improvement Bonds in the amount of $134,000,000; War Memorial Auditorium Bonds in the amount of $50,000,000; Parks and Recreation Bonds in the amount of $20,000,000 and Housing Bonds in the amount of $1,000,000; WHEREAS, the Council believes that current economic conditions would make the issuance of the bonds which pass the Referendum unadvisable until the citizens are assured that the economic strength of the community will support the issuance of the bonds and the appropriate use of the funds.

 

NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF GREENSBORO: That the Greensboro City Council shall not approve the sale or issuance of the 2008 Bonds, or any portion thereof, until the economy improves to the extent that the increase in the City’s overall debt is appropriate.

 

(Signed) Michael L. Barber

http://greensboro.granicus.com/DocumentViewer.php?file=greensboro_02382c4b9da536126d4be5089b05327f.pdf

Should Greensboro’s City Council borrow with “Two-Thirds Bonds” without voter approval?

Two-thirds bonds make comeback in Greensboro

 

What exactly are two-thirds bonds?

 

…as a portion of bond debt is paid off, state law enables local governments to issue bonds for up to two-thirds of the amount of the principle retired.

 

In other words, if Greensboro pays off $21 million in bond debt one year, council can issue $14 million in bonds the following year…

 

In the mid-1990s, several new council members…argued that voters should have a say in all bonds, and that doing otherwise was tantamount to undermining the will of the people.

 

Justin Catanoso

The Business Journal of the Greater Triad Area

Can Greensboro’s City Council increase outstanding indebtedness with a non-voter approved $11,360,000 “Two-Thirds Bond” to close the White Street Landfill right after authorizing a $21,000,000 revenue bond on August 18, 2009?

On August 18th, City Council adopted a revenue bond project ordinance

 in the amount of $21 million

 to finance the cost of a new incinerator at the Osborne Plant.

 

A contact for the construction was also awarded on August 18th.

 

Rick Lusk

Finance Director

City of Greensboro

 

NORTH CAROLINA CONSTITUTION

 

ARTICLE V, FINANCE

 

Sec. 4. Limitations upon the increase of local government debt.

 

2) Authorized purposes; two-thirds limitation.  The General Assembly shall have no power to authorize any county, city or town, special district, or other unit of local government to contract debts secured by a pledge of its faith and credit unless approved by a majority of the qualified voters of the unit who vote thereon, except for the following purposes:

 

(a) to fund or refund a valid existing debt;

 

(b) to supply an unforseen deficiency in the revenue;

 

(c) to borrow in anticipation of the collection of taxes due and payable within the current fiscal year to an amount not exceeding 50 percent of such taxes;

 

(d) to suppress riots or insurrections;

 

(e) to meet emergencies immediately threatening the public health or safety, as conclusively determined in writing by the Governor;

 

(f) for purposes authorized by general laws uniformly applicable throughout the State, to the extent of two-thirds of the amount by which the unit's outstanding indebtedness shall have been reduced during the next preceding fiscal year.

Are some Guilford County Commissioners attempting to violate the public’s trust by abrogating fiduciary obligations?

The problem with socialism

is that you eventually run out of other peoples money.

 

Margaret Thatcher

 

Commissioners table incentive plan

 

A plan to give public grants to small businesses in Guilford County was delayed this week to make sure the process would be legal.

 

Before Thursday, county commissioners seemed ready to approve a policy to give tax money to nearly any company here that increases its property value.

 

‘I believe this cash grant policy is problematic,” Tyler Mulligan, a UNC professor of public law and government said in an e-mail Wednesday.

 

In short, there were parts of the proposal that could run afoul of state law if contested in court.

 

…The current proposal, he contends, makes it unclear whether all grants would benefit the public…“The proposed policy could provide incentives for what some would consider odd priorities, such as a workplace fitness facility for existing employees,” Mulligan said.

 

After a draft policy appeared this month, board Vice Chairman Steve Arnold met individually with nearly every commissioner.

 

…Supreme Court Justice Robert Orr, questioned whether the plan would hold up in court.  Who receives the money and how it is distributed appeared too much like a tax abatement, he said.

 

Tax abatements — giving a break to select groups — are illegal in North Carolina.

 

The Guilford proposal for smaller businesses has no job requirement, and otherwise has minimal standards.

 

No other county has a similar plan, according to the School of Government.

 

Gerald Witt

Greensboro News and Record, August 21, 2009

 

Prudent Man Rule

 

An investment standard…to govern the action of those responsible

 for investing money for other people.

 

The fiduciary is required to act as a prudent man or woman would,

in regards to investing monies of others.

 

Bloomberg Financial Definition

 

What is a capitalist democracy that subsidizes to eliminate failure?

 

A democracy will continue to exist up until the time that voters discover

 that they can vote themselves generous gifts from the public treasury.

 

From that moment on,

the majority always votes for the candidates who promise the most benefits…

 

with the result that every democracy

will finally collapse due to loose fiscal policy…

 

Unknown