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A Deficit Hawk and Flood Funds

The GOP and California’s Levees

by SETH SANDRONKSY

"Inexcusable" is what Gov. Arnold Schwarzenegger recently called the lack of federal funds to improve the state’s system of flood control. In late February on a trip to Washington, he had asked for $56 million for emergency repairs on 24 levee sites eroded by rising river waters in Central and Northern California.

Following heavy rains in March and April, Schwarzenegger had declared a state of emergency in counties along the San Joaquin River in the central part of the state. People there scrambled to evacuate before a flood surge was forecast to arrive.

They dodged the flood bullet as state funds slated for future upgrades to the levee system were diverted to emergency labor. Workers placed tarps and sand bags on levee sites, watching 24/7 for breaks.

The governor’s recent news-conference rhetoric referenced the federal failure to protect people from the floods and storms of Hurricane Katrina in New Orleans and the Gulf Coast. The specter of this awful disaster was as a potential sign of things to come in Central and Northern California, he added.

And who could argue? Obviously, flood prevention is the best medication.

The governor promised to make his case for federal funding for flood protection to President George W. Bush during their meeting a week after Good Friday in California. Yet again, the Bush administration rejected Schwarzenegger’s request for emergency funds.

Despite the evidence, there are no grounds for declaring an emergency, with no new federal funds for flood prevention measures offered, according to the White House. Confused?

Consider this; the $56 million the governor sought is 0.002% of the projected 2006 federal budget. Perhaps the real reason for the administration rejecting Schwarzenegger’s plea can be found in deficit hawk thinking.

What? For a deficit hawk, government borrowing crowds out other, more productive capital investments, while increasing the cost of borrowed money.

Yet growth of the federal budget under President Bush has not caused interest rates to skyrocket. In fact, low interest rates have been an economic stimulus, with the home building and mortgage refinancing booms two examples.

In California and nationwide, people are taking advantage of low interest rates to borrow on their homes, harvesting new cash that, of course, must be repaid in the future. Businesses have welcomed the increased buying power of these homeowners.

A deficit hawk that roosts in the minds of some officials on 1600 Pennsylvania Ave. may be challenged to explain this trend of low interest rates with a high federal budget deficit. That is, if reporters ask such a question.

Back in California, tens of thousands of people live in floodplains behind weak levees, some more than 100 years old. Contrast such real facts with a deficit hawk’s theory that the federal government is acting with fiscal prudence by failing to provide California with emergency funds to upgrade its weak levees.

Seth Sandronsky is a member of Sacramento Area Peace Action and a co-editor of Because People Matter, Sacramento’s progressive paper. He can be reached at ssandron@hotmail.com