Governor Mark Sanford penned the following op/ed for the WSJ this week. It is the most well-reasoned, intelligently crafted argument on this topic I’ve read to date. Sanford looks more and more like a 2012 threat every day.

Why South Carolina Doesn’t Want ‘Stimulus’
Columbia, S.C.

America’s states are laboratories of democracy. They are both affected by, and relevant to, the larger national debate. What we’ve found in our own corner of the country is that carrying a substantial debt load limits our options when it comes to running government.

A recent report by the American Legislative Exchange Council ranked us 47th worst in the nation for annual debt service as a percentage of tax revenue. Our state dedicates nearly 11% of its annual tax revenue to paying debt. On top of that, South Carolina has another $20 billion in unfunded, long-term political promises for pensions and other liabilities. The state budget has already been cut four times in recent months as the national economic downturn has impacted South Carolina and driven down tax revenue.

President Barack Obama recently signed a “stimulus” bill that will spend about $2 billion through “programmatic means” in South Carolina. In other words, the federal government will put this money directly into existing funding formulas and programs such as Medicaid. But there is an additional $700 million that I as governor have influence over, and it is the disposition of this money that has drawn the national spotlight to South Carolina.

Here’s the background: Before the stimulus bill passed, I asked for states not to be bailed out. After it was signed into law, I said that a state bailout would create more problems than it solved, and that we shouldn’t spend money we don’t have. That debate was lost, so I looked for a reasonable middle ground. I asked the president for his support in using the $700 million to pay down state debt.

If we’re going to spend money we don’t have at the federal level, it becomes all the more important that our state balance sheet is in good order — particularly if this is a protracted downturn. But many people do not realize that the stimulus money runs out in 24 months — at which point South Carolina will be forced to find a new source of funding to sustain the new level of spending, or to make sharp cuts. Sure, I could kick the can down the road; in two years, I’ll be safely out of office. But it would be irresponsible.

If South Carolina could use stimulus money to pay down debt, in two years we will be able to spend, cut taxes or invest even if the federal government can no longer provide more money — not a remote possibility. In fact, paying debt related to education would free up over $162 million in debt service in the first two years and save roughly $125 million in interest payments over the next 13 years — just as paying off a family’s mortgage early frees up money for other uses.

When you’re in a hole, the first order of business is stop digging. South Carolina is in a hole, and it’s not a shallow one. Spending stimulus money on ongoing programs would mean 10% of our entire state budget would be paid for with one-time federal funds — the largest recorded level in state history.

Also, spending stimulus money will delay needed state restructuring. General Motors recently found itself in a similar spot. It needs to be restructured if it is to prosper, but a federal bailout enabled it to put off hard decisions. Likewise, taking federal stimulus money will only postpone changes essential to South Carolina’s prosperity. Though well-intended, it forestalls hard choices we must make.

One of Mr. Obama’s central campaign themes was his pledge to do away with politics of the past. In his inaugural address, he proclaimed “an end to the petty grievances and false promises, the recriminations and worn-out dogmas, that for far too long have strangled our politics.”

This idea connected with millions of voters, myself included. I’ve always believed ideas should rise and fall on their merits. In fact, I saw such historical significance in his candidacy and the change he spoke of that I published an op-ed on it before South Carolina’s presidential primary last year. It was not an endorsement, but it did note the historic nature of his candidacy and the potential positive change in tone it represented. That potential may now be disappearing.

Last week I reached out to the president, asking for a federal waiver from restrictions on stimulus money. I got a most unusual response. Before I even received an acknowledgment of the request from the White House, I got word that the Democratic National Committee was launching campaign-style TV attack-ads against me for making it.

Is this the new brand of politics we were promised? Instead of engaging with me and other governors on the merits of our dissent, I am to be attacked in television ads? In the end, I just don’t believe a problem created by too much debt will be solved by piling on more debt. This doesn’t strike me as an unreasonable or extremist position.

Nevertheless, the White House declined my request for a waiver yesterday afternoon. That’s unfortunate. But in coming months we’ll continue advancing the debate at the state level about the merits of debt repayment. The fact remains that while we’d all like to spend unlimited dollars on the very real needs that exist in our state, we must spend in the context of what is sustainable.

Mr. Sanford, a Republican, is the governor of South Carolina.


  • Some Guy

    Obama is the least competent person to hold the presidency since Jimmy Carter. He’s completely out of his depth, and nothing could make this more plain than the fact that he gave the job of treasury secretary to a Federal Reserve bankster.

  • Mike

    If Sanford thinks that paying down the state’s debt is that important, then why has he been running a deficit all this time?

    He accuses Obama of playing political games, yet finds his fiscal responsibility only in a time of political expediency.

    • Some Guy

      “If Sanford thinks that paying down the state’s debt is that important, then why has he been running a deficit all this time?”

      Perhaps because he doesn’t have the power to appropriate money, the legislature does.

      Got any more ignorant ranting to do, sunshine?

      • Mike

        Are you telling me the governor of South Carolina does not have veto power?

  • Alaina Segovia

    The more I hear from Stanford, the more I love him!

    It’s nice to know that there’s at least one person in politics who understands economics and can read a balance sheet.

  • East of Eden

    Wow, that was a GREAT op-ed. I’ve been thinking many of those same things for a while now. Thanks Jason for sharing this….

    Stanford is spot on about taking on new debt. Here in New Mexico we just barely, and I mean barely squeeked out a balanced budget for this year, with major cuts all around. Bill Richardson keeps trying to sell everyone on how great this stimulus money will be (sadly, he doesn’t have to work very hard on that here, as most see Obama as God himself) I worry what will happen to this already troubled state when the extra cash runs out.

    and Kjco — all of the things of which you speak trouble, shock and disgust me to no end. People wondered how we eleced GWB, I wonder then same thing about Obama, as he is far more dangerous than any that ever came out of Crawford.

    • Alaina Segovia

      You know, if things get too bad over there, you could always take the casinos back from the Indians.

      • East of Eden

        Alaina..those are are “Gaming Centers”…and lucky me there are 8 with in an hour drive of my house in the middle of nowhere. And, and! They have penny slots! In the words of Jeff Foxworthy you, “You might be a redneck if you have to break a nickle to play the slots”

  • kjco

    Does anybody but me find the threats of recrimination shocking? Not that the threats were made–the Exec branch is now playing Chicago style politics in a neighborhood near you–the threats are commonplace & expected. It’s just the context of a normal transaction of govt. business–a governor asking for a modification in the strings attached. The administration’s FIRST reaction was not to acknowledge or excuse or even deny. It was to intimidate. Can this get any more Stalinist (see the Wiki on Stalin–some really creepy similarities here)?!

  • Lizzy

    Obama needs a straight jacket. He is not well! His policies are economic suicide, from what I’m reading. Can someone wake him up?

    • Brian H

      C’mon Lizzy!

      How many “community orgainzers” do you know that could do a better job? We need to all relax and understand that Barry’s light resume entitles him to an 8 year learning curve. Sure he will do tremendous damage to the nation during this process, but, by the time he completes his second term he will almost have the experience he needs to have been effective at the job he will be leaving. But, he is young. King of the World may be his next career move.

  • Dave

    Use 5 drunken mice then! Wait, they cant use tasers. Orangutans then, they have orange fur! :-P

  • Dave

    So far, Sanford SC, Perry TX, Barbour Mississippi, and PAlin have rejected all or some of the funds. Add ‘em to that 2012 list!!!

    Bet Romney and Huckabee are glad they dont have to be involved in these sticky decisions.

    Sanford might make it to 2012, if SC stops digging a hole, and starts filling it up instead.

  • Brian H

    Great post Jason. Thanks.

    No doubt that Sanford is the solid morning line favorite.

  • Rusty Shackleford


    That might be the understatment of all time, “Although not as smart or as well spoken”…

    Rick Perry makes as much sense as 5 drunken monkeys with tasers performing greeter duties to Wal*Mart customers.

    • Brian H


      Please refrain from any references to monkeys. We have learned from recent past events that any such reference to a monkey can and will be used against you as a racist slur. We are in the age of Obama. We need be sensitive to such sensitivities.

      • Rusty Shackleford

        Sorry Brian,
        You of course are correct sir.

        Subtract Monkeys and replace with armadillos

        Add an extra 25% to my taxes as a “gentle” reminder

        • David Kaiser, Editor

          As the representation for Armadillos For Equality, I officially protest this statement Mr. Shackleford.

          Expect an army of ‘Dillos to picket your place of residence in the near future unless my clients receive a full apology and a case of insect grubs as compensation for this slight.

          That is all.

  • Gil Rice

    Although not as smart or as well spoken as Gov. Sanford, Gov. Rick Perry of Texas turned down stimulus money for a lot of the same reasons. Will the 2012 runner come from these ranks that see thru bamanomics?

  • kristen

    I read this a few days ago, and I have an even greater respect for Sanford. How about a Romney/Sanford ticket in 2012? Whatever the case, I hope he makes it to the national stage. We need more sane and logical people like this in Washington.