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South Carolina Governor’s ‘Stimulus’ Recommendations: An Orgy Of Government Excess

Henry McMaster’s big government bonanza …

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So-called “Republican” rule is alive and well in South Carolina, as the state’s GOP chief executive and a panel of his political appointees want to blow an estimated $8.89 billion in federal “stimulus” funds on what can only be described (charitably, at that) as an orgy of government excess.

And yes, this massive stockpile of federal “manna” comes on the heels of GOP lawmakers blowing every penny of a $2 billion surplus on the Palmetto State’s bloated, results challenged maze of corrupt, byzantine bureaucracies.

Seriously … not a dime of tax relief was even proposed during the 2021 legislative session, let alone considered or (God forbid) passed.

Now, governor Henry McMaster – who bills himself as a Trump-loving “conservative” – is proposing (.pdf) to spend more than $9 billion from the so-called “American Rescue Plan” between now and December 31, 2024 on another big government wishlist.

In fairness to McMaster, much of these “rescue” funds are already spoken for … $2.11 billion for “elementary and secondary school relief,” $1 billion to county governments, $626 million to municipal governments and $523 million to “higher education emergency relief,” among other earmarks.

But the governor and state lawmakers have discretion over an estimated $2.95 billion in “state fiscal recovery fund” dollars – and another $188 million in money available for new “capital projects.”

In other words … more than three billion dollars.

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THE WISHLIST …

The top item on McMaster’s expansive wishlist? Rural internet access. A whopping $490.1 million of the “rescue” funds at the state’s disposal would be appropriated toward the expansion of “rural broadband” – assuming McMaster gets his way. And yes, this funding would come on top of $121 million awarded to the state by the Federal Communications Commission (FCC) back in December for “rural broadband” – and on top of the $50 million lawmakers devoted to this same purpose in their spending plan for the 2021-2022 fiscal year.

Given that private industry has committed to spend approximately $200 million on rural broadband in the coming years, according to the S.C. Office of Regulatory Staff (SCORS), exactly how much more money should taxpayers pour into this project?

By any measure, this appropriation is excessive … and ignores far more critical needs related to core functions of government.

Next on McMaster’s wishlist is a $250 million appropriation for so-called “small business grants” – although his panel makes it clear that this money could eventually be routed instead to the S.C. unemployment insurance (UI) trust fund instead. As of last month, this fund had a balance of $1.178 billion – money collected from businesses in the state and then doled out in the form of unemployment benefits, when necessary.

McMaster and his panel want to set aside this money “for later use to fund a small business grant program, or to replenish the UI trust fund should circumstances dictate those expenditures.”

Again … where is the “rescue” here?

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This money cannot be used to shore up the UI fund at present because business have filled it with more money that it had prior to the Covid-19 recession (sort of like state coffers). So, the governor and his advisors are proposing to hold on to this particular pile of cash and spend it at a later date.

Don’t get me wrong: I am all for allowing struggling small businesses to receive grants … but this appropriation is shaping up to be yet another shell game. And assuming this money is ever earmarked for grants, expect that playing field to be unfairly tilted from the very beginning.

Item number three on the governor’s wishlist is $400 million for “water, sewer and wastewater infrastructure” – with $72.4 million in additional funds earmarked for “cybersecurity for water and wastewater.” While these are core functions of government, municipal governments across the state – including the city of Columbia, S.C. – have failed to fund them adequately over the years. As a result, many of the state’s estimated 300-plus water and sewer systems are “old and outdated,” according to McMaster’s report.

Wait, though … why does the state have to bail these systems out? Why can’t municipalities and counties use the bailout money they are getting to fix these problems?

Those are good questions …

A better question is this, though: Why have so many local governments allowed these critical infrastructure assets to fall into such a state of disrepair? What have they been blowing their money on instead?

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“SUBSIDIZING DEFINITIONAL FAILURE …”

Moving on, McMaster wants to spend $36 million on “workforce development” and another $50 million in “supplemental educational services.” Not to put too fine a point on it, but these expenditures are glaring admissions that the hundreds of billions of dollars pouring into the Palmetto State’s chronically failed government-run education system are not going to move the needle in terms of academic achievement.

After all, why would state taxpayers need to subsidize a grant program for more “instructional materials,” “tutoring services” and “after-school education programs” if the billions of dollars currently cascading down on the government system (which includes money for all of the aforementioned items, incidentally) was serving its intended purpose?

Exactly …

McMaster doesn’t stop there, though, suggesting another $15 million for so-called “schools of innovation” which are intended to supply “curriculum, instructional materials (and) professional development” for the purpose of addressing “educational disparities.” He also wants to appropriate $10 million for an “educational dashboard” enabling administrators to better track “educational attainment and growth.”

“Good decisions start with good data,” McMaster’s panel noted.

Good luck finding any of that in the Palmetto State …

Either way, all of this money is totally unnecessary given the massive windfall the Palmetto State’s government-run schools received in the FY 2021-2022 budget, the billions in “rescue” funds they are receiving and the massive piles of cash they continue to stockpile in reserve.

What is this investment producing, exactly? Not much. Academic outcomes in South Carolina are atrocious. And throwing more money into the same broken system expecting it to churn out a different result is definitional insanity.

Mark my words: The only thing this money will change is the already-astronomical cost of failure.

Speaking of subsidizing definitional failure, McMaster wants to spend $350 million on what he calls the Palmetto State’s “world class port system.”

Wait a minute … world class?

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Again, I hate to be the bearer of bad news but South Carolina’s port is getting its ass handed to it by its regional rivals – and has been for the last two decades. Not only that, this funding will only assist the S.C. Ports Authority (SCPA) as it implements a new container transfer system which directly competes against private sector logistics providers.

Want even more terrible fiscal decisions? McMaster and his panel have got you covered …

A total of $32.5 million in “rescue” funds would be spent on so-called “long-term tourism recovery efforts” – i.e. tourism-related advertising and marketing expenditures. As I have previously noted,  efforts by state and local governments to funnel tax dollars toward specific “destination marketing” campaigns fail to move the needle one way or the other when it comes to luring visitors to the Palmetto State. Tourism’s success or failure is driven by macroeconomic trends, period. The data on that couldn’t be clearer.

Accordingly, the governor mights as well dump every penny of that money into the ocean … which, incidentally, is exactly what he intends to do via a separate recommendation for $25 million in “beach renourishment” funding.

Continuing with the parade of bad choices, the governor wants to put $50 million into a “nonprofit relief program” that assists organizations which ostensibly “provide needed assistance to our state’s citizens.”

Again … here is a novel idea: Why not let South Carolinians keep more of their own money and let them decide which charities they wish to support?

Another $50.3 million would go toward various “agribusiness” ventures, including $20 million for so-called “food supply chain infrastructure” improvements which purport to address “food shortages” which occurred during the Covid-19 pandemic. Oddly enough, though, a separate $3 million appropriation would go toward a program intended to address an alleged “oversupply of product due to restaurants and school closures.”

Wait … so which was it? Food shortages or oversupply?

Again, I have no trouble helping farmers directly … but government clearly doesn’t have a clue which end is up when it comes to managing this process.

In related agricultural expenses, $2.75 million has been earmarked by the governor for an expansion of the state farmers’ market, with another $4 million routed toward “consumer advertising” of South Carolina-grown agricultural products.

Neither of those expenditures come anywhere close to being core functions of government, though …

(Click to view)

(Via: Getty Images)

Does McMaster’s pork-laden proposal contain any worthwhile spending items? Yes … his wishlist included a $27.4 million appropriation for body-worn cameras for law enforcement agencies across the state. So far, South Carolina’s financial commitment to this program has been a sham – sort of like the transparency that was touted in its implementation. Accordingly, I am glad to see this critical need being addressed – although I would argue it should be contingent on law enforcement agencies making body camera footage available in response to Freedom of Information Act (FOIA) requests.

Again, there is no point to a body camera law if footage from said cameras can be withheld arbitrarily.

McMaster also wants to spend $14.6 million on “sufficiently outfitting” the S.C. Emergency Management Division (SCEMD) headquarters in West Columbia. Another $10 million would be spent to store the state’s stockpile of personal protective equipment as maintained by SCEMD. I have no issue with either of those appropriations.

Furthermore, I support the $170 million McMaster is proposing to spend on the widening of Interstate 26 between Columbia and Charleston, S.C. Like so many other interstate projects in the Palmetto State, this one should have been completed decades ago. Unfortunately, lawmakers were too busy blowing money on non-essential infrastructure.

Better late than never, I guess?

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MO’ MONEY, MO’ PROBLEMS …

Beyond these few modest investments in core functions, though … McMaster’s list is about as terrible an assemblage of spending recommendations as could be imagined. The lack of support for law enforcement (and prosecutors) evidenced by this proposal is particularly troubling. Such shortchanging is inexcusable under any circumstances but it is particularly galling in light of the rising tide of violence in South Carolina.

The best recommendation McMaster and his panel made? Easy: That would be the $546.6 million in “rescue” funds they did not appropriate – arguing this pot of money should “be set aside for some period of time and only allocated as circumstances evolve.”

Nothing says “emergency” quite like politicians being unable to spend all of the money being thrown at them, does it?

“We can’t spend the flood of money sent to us by the feds,” one fiscally conservative Palmetto State official told me. “It is sickening to watch the rich status quo line up for the handouts.”

Indeed. And rest assured, while McMaster held off on earmarking every last dime of this money, fiscally liberal legislative leaders like senator Hugh Leatherman will find a home for the money the governor held in reserve.

Adding insult to injury, the lead author of this fleecing had the temerity to suggest it was somehow an investment in the people of this state.

“South Carolina’s future remains bright, and we believe in her people as they continue to be the state’s greatest resource,” a letter from McMaster’s panel chairman James H. Burns noted.

Really? Then why do fiscally liberal politicians like McMaster and his allies in the S.C. General Assembly refuse to appropriate money in a manner that helps these under-earning, over-taxed citizens as they seek to bounce back from the recent recession? Why, in fact, do they keep steering money away from them?

“This money goes to two places: Democrats and corporations,” one fiscally conservative Palmetto State official told me. “Republican voters (taxpayers) are shut out.”

Actually, it is worse than that … taxpayers of both parties will be stuck picking up the tab for this excess for decades. And with the exception of the handful of expenditures earmarked to core functions, there will be absolutely no measurable improvement when it comes to critical outcomes (economic, academic, health, public safety, etc.).

The only thing explosion in bureaucratic/ crony capitalist/ special interest boondoggling is going to produce is a more expensive iteration of the Palmetto State’s unofficial motto: Mo’ Money, Mo’ Problems.

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ABOUT THE AUTHOR …

(Via: FITSNews)

Will Folks is the founding editor of the news outlet you are currently reading. Prior to founding FITSNews, he served as press secretary to the governor of South Carolina. He lives in the Midlands region of the state with his wife and seven children. And yes, he has LOTS of hats (including that Durham Bulls’ lid pictured above).

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