CNMI Running on Empty

December 19, 2011

I look at federal and state budgets the same way I look a family budget. There are some common sense basic guidelines for not going bankrupt. Look at what's coming in and don't spend more than that amount each month. If you have to borrow, borrow only what you can pay back within a couple years with an affordable monthly payment plan. If your income decreases, spend less or increase revenue.

I read an article about projections of the CNMI deficit with amazement. Lt. Governor Inos predicts that there will be a $15 to $20 million deficit in the CNMI budget next year. He also stated that the cumulative deficit was over $300 million including money owed to the retirement fund. A report prepared by the First Hawaiian Bank shows a bleak economic future for the CNMI. Not good.

This is a  truly mismanaged  and incompetent government. Where are the local property taxes, income tax or sales tax to bring in revenue?

The decline in tourism, decline in population and the decline in available jobs, as more and more business close their doors, is a recipe for disaster.  Last week Tony Babauta, the Assistant Secretary of Interior told CNMI officials to brace for less CIP federal funding. The CNMI should not expect any bailouts from the U.S. taxpayers.

The elected leaders should be acting in crisis mode and determining how to raise revenue.  Here are some hints. Revenue can no longer be raised off the backs of oppressed foreign workers. It cannot be raised by passing a revenue-generating but unconstitutional immigration bill masked as a labor bill.  And it cannot be raised by putting out the hand that is not being used to stab Uncle Sam in the back. The CNMI government better get it together quickly.

Government employees can expect more layoffs, more delays in pay and more cuts in hours. The CNMI can also count on a continued decline in tourism as many may opt for a vacation spot that has less crime and more aesthetic appeal. Vacant, rundown or boarded up buildings (especially ones with racist graffiti) are not pretty to tourists or investors.

I suspect that the foreign workers and residents who have not received their tax rebates or past stimulus checks may never receive them if they do not push the issue.  It appears that the money that should have been set aside for rebates has been shifted to fill voids in other budget areas. Maybe payroll? Who knows? Perhaps the money is being used to fund Fitial's lobbyists in Washington, D.C.

Governor Fitial is asking Senator Lisa Murkowski to help with securing a $100 interest free loan from U.S. taxpayers for exploration of geo-thermal energy for the CNMI. Interest-free? This taxpayer opposes the plan to give the CNMI even one more penny of our federal tax dollars for this type of noncritical needs while the U.S. citizens in the states are forced to take pay cuts and suffer the results of other budget cuts. This is especially offensive since no one who lives in the CNMI even pays federal taxes. Additionally, the CNMI does not possess the credit standing to be given an interest free loan that will most likely never be paid back.

It is ironic that so many of the CNMI leaders request "special" treatment or independence from the federal government (at least where laws are concerned), but the CNMI is close to a total welfare state dependent on federal handouts. Where is the dignity in that equation?

3 comments:

Anonymous said...

CNMI leaders does not have dignity and have thick face, that's all!. Someone should wake these clowns (or beggar) up!

Anonymous said...

In regards to that Geothermal project with the exploratory drilling.
I have heard that the proposed site land belongs to Fitial.
I do not know if this is true, but if so, that would prove more interesting as to why Fitial is pushing for a loan to fund the development of this project.
He was also pushing for the funds for this exploratory well.

But in this whole project, there is little chance that this will have a feasible outcome as far as there being any reliable source.

Although the new tech Geothermal wells can convert water at a temperature as low as 57C the volume of water plus many other factors are involved.
A Geothermal well usually is 5000'-10,000' deep and are very costly to drill plus the installation of the casings etc, especially for a small out of the way Island such as Saipan.

The point is well taken about these clueless incompetent elected, but, given the financial conditions in the CNMI, I doubt seriously that this loan would go through unless there are more clueless elected in Wash. DC. (Oh but there are)

Anonymous said...

this is a scam for the administration to scurry away more federal funds.

Unfortunately, the feds have no interest in pursuing any criminal activity out here.