🚀 go-pugleaf

On 23 Aug 2006 13:37:43 -0700, "lein" <boomer_the_cat@my-deja.com>
wrote:

>
>Paul J. Berg wrote:
>> What if Oregon could enjoy the fastest economic growth rate of any state
>> over the next five years? What if, over the next two years, Oregon could
>> build a rainy day fund in excess of $2 billion to help cushion
>> inevitable economic downturns?
>
>A rainy day fund isn't necessarily a good thing.

Depends on what you do with it.

>  It would allow a
>government that becomes bloated and unresponsive to maintain status quo
>and avoid necessarily reorganizations.

No reason to assert that would necessarily follow.  A cash pool
doesn't require that outcome.

>Also, a pot of $2 billion just sitting there will soon become a pot of
>$2billion worth of IOUs.

First off, it won't just sit there.  That would be a Really Stupid Way
to manage any large cash pool.  It will be held in banks as a part of
their reserve, and from which they will loan money, but they will be
required to redeem the loan from the State on demand.

Modern cash pool management techniques are probably unknown to you,
but they do exist, to the general benefit of taxpayers.

The main criticism of Rainy Day Funds is that they require an overtax
above current spending and debt servicing.  That's a perfectly
legitimate question, and different folks have different takes on doing
so.

One could, for example, use a state's borrowing power to get through
the occasional periods of insufficient cash flow just as easily,
rather than establishing a Rainy Day Fund.  The problem with that, of
course, is establishing appropriate limits on the action, but that's
no more difficult than establishing the RDF itself.

>  Afterall, politicians were elected to solve
>problems they invented, they will need that money to solve their make
>believe problems, and of course they will want ot live up to their
>promise to provide all things to all people without raising their taxes.

The folks elected don't invent the problems.  In fact, they'd as lief
not have them in the first place.  They didn't invent the need for law
enforcement, courts, public health, public infrastructure or a panoply
of other needs that The People have declared are important.