THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Sunday, March 3, 1996 TAG: 9603010008
SECTION: COMMENTARY PAGE: J4 EDITION: FINAL
TYPE: Editorial
LENGTH: Medium: 57 lines
The beauty of having 50 states is that Virginia can learn from the 49 others' stupidities.
Connecticut, for example, is poised to commit a beaut of a dead-brainer.
A $200 million tax cut is scheduled to begin there next year, so the governor, John G. Rowland, needs funds to fill the fiscal hole.
He proposes transforming the state lottery into a government-owned corporation, then selling a 6 percent share to private investors.
To overcome an immediate shortfall of funds, Connecticut would forgo forever (a very long time) a chunk of the lottery revenue.
Analysts for bond-rating organizations told The New York times that the state is sacrificing long-term revenues for a short-term fix.
``It's a way to rob some revenue from the future,'' said Harvard University Professor John D. Donahue, who wrote the book The Privatization Decision: Public Ends, Private Means.
When a state sells lottery shares, it becomes a shill for investors. It's one thing for a state's TV commercials to lure its citizens to gamble ever-more dollars so state needs can be met. It's another thing for the state to seduce its citizens to gamble to profit investors.
Once Connecticut has sold 6 percent of the lottery and new short-term needs arise, what's to keep the state from selling another piece of the golden goose? By doing so, a governor can acquire instant millions, secure in the knowledge he or she will be long gone from office before the pain of lost revenue is felt.
One of the supposed advantages of transforming the lottery into a government-owned corporation is that the latter would be freer to pursue lottery dollars. For example, legislative approval would not be needed to introduce new lottery games.
Actually, freeing a state lottery to rapaciously pursue the gambling dollar is, in fact, a disadvantage - at least a moral one. The Virginia General Assembly served its constituents well this session when it nixed a hard-core lottery game the governor proposed, which was associated with compulsive gambling.
Connecticut is not alone in attempting to apply short-term Band-Aids to long-term fiscal wounds.
Virginia had a marvelous opportunity to set up a medical-education foundation with a proposed $165 million settlement from Trigon Blue Cross Blue Shield. Foundation-sponsored research might have attracted biotech dollars for decades. Instead, all or most of the money will be spent in one biennium, ending July 1998, to fill budgetary holes - then be gone or nearly gone.
As the federal government shrinks and more of the financial load for public programs falls on states, they may turn in desperation to short-term solutions that over the long haul will prove stupid. The least Virginia should do is avoid other states' stupidities. Our own will suffice. by CNB