Mayor Mike Johnston and the Denver City Council are campaigning for a proposed new debt request on the ballot this coming Nov. 4. They call this proposed debt, the “Vibrant Denver bonds.”
One key selling point for city officials has been to talk about new parks, or as Mayor Johnston said, “projects in your neighborhood that create moments of joy.”
Who doesn’t want new parks/ We all want more parks — but let’s take a closer look here.
Laura Swartz with Denver’s Department of Finance is campaigning for more debt by claiming the proposed bonds make sense because, “We see construction costs increase more every year than the interest cost on the bonds.”
Swartz claims that by using debt, “We are saving money by averting inflation in the future.” Oh really?
1.) As soon as we build a new park, we need to maintain it. The cost of maintenance for new parks would be more than forecasted inflation. It would also be more than the money paid for interest—effectively doubling the interest rate when we include maintenance.
If we don’t have money to build the park, how the heck will we have yearly budget money to maintain it, especially after we begin to service new debt with enormous amounts of interest, fees, and other financial costs further draining the budget? In addition to maintenance costs, once we build a park, there are so many other costs permanently attached to it.
We don’t save money by spending money. One would think our city’s financial staffers could have this figured out – but that’s the point – their point is to deceive in order to realize their greedy policy.
2.) If we should borrow out for 10 years to save money, then by the same logic we should borrow out for 20 years, and 40 years, too. Heck, we should buy everything the city will need for the next 80 years to save even more money. The more we spend the more we save.
Science and math are based on the axiom of reproducibility — so it would make sense to borrow out forever — according to Laura Swartz’s logic.
If you can’t afford it today, the fact that it will be more expensive in the future does not change the fact that you can’t afford it today.
Furthermore, the city’s financial staffers lie about the effective interest rate by buying down the rate with enormous amounts of fees and other costs paid to several financial corporations in order to make the deal happen. All this so that the politicians can promote an artificially low interest rate as they campaign to get the city further into debt.
I love parks and I want more parks. But I don’t want more parks using debt because this takes our budget money and gives it to the bank. We buy a lot more park, per dollar of city budget, when we do not use debt. Basic math my friends.
Also, I should note that the city seems unable to properly maintain the parks we already have. Shouldn’t we expect the City to figure out consistent, year-after-year, well-done maintenance for the parks we already have before we build new parks that will also require maintenance?
Our politicians team up with their financial staffers as they campaign for more debt for the city. More debt would only cause additional budget problems for tomorrow and the next day.
Our politicians keep telling the voters, “We must use bonds to get this done.” This political nonsense is being radiated throughout Denver’s echo chamber. The idea that debt will give more to the city is pure nonsense.
Forever debt is terrible financial strategy for our city — shortsighted nonsense causing long-term problems.
We need to cut the banks from the budget.
Jason Bailey is the founder of Citizens for NO New Debt, an independent, nonpartisan, public service campaign working to reduce government debt. More information at: CitizensforNOnewdebt.org.
Jason Bailey is the founder of Citizens for NO New Debt, an independent, nonpartisan, public service campaign working to reduce government debt. More information at: CitizensforNOnewdebt.org.
