Cantor warns about relying on stimulus funds
I caught up with Rep. Eric Cantor on Friday. He was touring the brand new Patrick Henry School of Arts and Sciences. The facility is the first charter school in Richmond and Cantor, along with his fellow Republican Governor Bob McDonnell are big supporters of the project.
During our conversation, I asked the Congressman what he thought about the news that Virginia’s budget ended the fiscal year with a surplus of more than $400 million. Governor McDonnell explained on Thursday how the Commonwealth went from billions of dollars in the red to almost half a billion dollars to the good. He attributed the turnaround to a number of factors, including new efficiencies at state agencies, an increase in tax collections and of course, the Federal Stimulus plan. It was a point that national Democrats were happy to pounce on.
While McDonnell presented the good fiscal news as a positive development, he warned that the worst is not over. He said there is still a possibility of a double-dip recession and he and his budget team are forecasting conservatively as a result.
One of the Governor’s chief allies in the House of Delegates went even further. Del. Kirk Cox, the Vice-Chair of the House Appropriations Committee told me during a live interview on First at 4 that we was “worried” about what the budget situation could be like next spring. Cox said he doesn’t expect any more money to come from Washington and Virginia should hold on to what they’ve got.
“Before we go spending the surplus, we need to know what the growth rates are going to be,” said Cox. ”Currently we projecting about a 3.8% growth rate and that’s pretty slow coming out of recession. If it’s less than that, we probably have to bank some of that money for basically a reserve.”
During our conversation Congressman Cantor said that stimulus money isn’t something Virginia should be using at all. “The stimulus was meant to create jobs,” he said. “From that perspective it has been a complete failure.”
Cantor said that even though Virginia was able to get through this budget storm, the worst may still be to come, in part because the stimulus hasn’t lived up to its promise. The Republican is concerned that next year Virginia could get hit with a double whammy. An economy still struggling to recover, coupled with no guaranteed money from Washington.
“That cash is no longer there, the jobs aren’t there and the people of this Commonwealth and the country in a much larger sense, are stuck with the bill.”
It seems like everyone is worried about what is to come.
You can see my entire interview with Del. Kirk Cox by clicking here.
An extended clip from my interview with Congressman Cantor is below: