Scene in Passing: A billion ain’t worth a trillion anymore
September 22, 2013
Something turned up last week in a desk drawer that brought to mind running-in-place dilemmas faced by this city, our state and the nation.
It was a "One Billion Dollars" bill, sort of official-looking and replete with green ink.
It's bogus, of course — funny money picked up at the May annual meeting of Berkshire Hathaway. It was a marketing ploy from Fechheimer Brothers Co., the uniform-making firm in billionaire Warren Buffett's BH conglomerate. This billion-bucks bill has an American eagle on the front and caricatures of Berkshire leaders on the back. Ev Dirksen came to mind.
"A billion here, a billion there, pretty soon it adds up to real money," Illinois Sen. Everett McKinley Dirksen said back in the days when gasoline cost 30 cents a gallon.
"But the basic difficulty still remains," he said. "It is the expansion of federal power about which I wish to express my alarm. How easily we embrace such business."
"Such business" seems an appropriate segue to move on and contemplate today's Federal Reserve, a quasi-governmental banking behemoth. Seeking a thumb-in-the-dike way past a dysfunctional Congress, the Fed stokes inflationary fires to combat deflationary fears. It did so again last week by keeping money almost as cheap as Fechheimer's funny stuff.
Of course, money isn't really cheap when a billion here and a billion there are drops these days in the trillions talk swirling around in budget buckets.
What looks cheap short term, via low interest rates, could prove massively expensive in the long haul if the Fed and Congress don't finesse difficult terrain economically the next few years. That's why Janet Yellen for Fed chief to replace Ben Bernanke makes sense. Yellen, vice chair of the Fed's Board of Governor's, should and likely will be chosen.
As International Monetary Fund managing director Christine Lagarde has said, we have enough testosterone and hairy-chested stuff in private and public finance already. After all, men who think women don't run our finances in reality aren't tracking quite correctly, are they?
By now you're wondering what any of this has to do with Carson City government and business. Glad you wondered. Let's take a peek right now at just one exemplary problem city government faces during this economic running-in-place monetary and fiscal policy period.
Back in Dirksen's day, with gas at 30 cents a gallon, people drove everywhere. Gas taxes were lower. Revenues abounded. Roads were built and streets repaired. Now think about Carson City's spotty streets and drawn-out freeway bypass project. Pothole pitfalls and bypass blarney prevail.
In part it's because of the incredible shrinking dollar and the lost road revenue stream. Carson City's Larry Werner, city manager, now says city government is eyeing a run at voter-approval for indexing of gasoline taxes to find more money to fix roads. So stay tuned.
John Barrette covers Carson City government and business. He can be reached at email@example.com.