S.C. Governor Opposes Stimulus But May Take Aid Republican Gov. Mark Sanford of South Carolina is opposed to President Obama's economic stimulus package. However, he has said he may be open to taking some of the stimulus money for his state. In some instances, Sanford says the costs out weigh the benefits.
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S.C. Governor Opposes Stimulus But May Take Aid

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S.C. Governor Opposes Stimulus But May Take Aid

S.C. Governor Opposes Stimulus But May Take Aid

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STEVE INSKEEP, host:

It's MORNING EDITION from NPR News. I'm Steven Inskeep.

Next, we'll turn to one of the governors who've been meeting in Washington at a dramatic time. Mark Sanford of South Carolina is a Republican, and he is a skeptic of the stimulus plan that President Obama signed last week. He's on the line.

Governor, good morning.

Governor MARK SANFORD (Republican, South Carolina): Good morning.

INSKEEP: Let me understand what you're going to do with the stimulus money, several billion as I understand it, that's been offered to your state. Will you accept it or will you, as some Republicans have suggested, turn it down?

Gov. SANFORD: I think the answer is we'll probably turn portions of it down.

INSKEEP: Portions of it down?

Gov. SANFORD: We're going through now with a fine-tooth comb and looking at what makes sense and what doesn't make sense. In some cases, there are such strings that I think the costs outweigh the benefits. So that's where we are now. The bigger picture of where we are is, again, I think that the stimulus in its entirety is a mistake and will prove not to produce the results that everybody's looking for.

INSKEEP: Well, governor, as you know, some Democrats and also some Republicans like Arnold Schwarzenegger of California are suggesting this is a choice between practicality - taking the money - and ideology. When you talk about strings attached, is there a practical objection, a practical reason to say no to some specific item of money that your state might be getting?

Gov. SANFORD: Yeah, I'll give you an example.

INSKEEP: Please.

Gov. SANFORD: For instance, our unemployment insurance benefits in South Carolina are currently under funded. This fall, they went to the feds and asked for $140 million in loan to keep operating. Then they came back a couple of months later and asked for yet another $170 million. And so you have a level of benefit that can't even be supported currently. And yet the only way to draw down these federal funds with the stimulus package would be to, in fact, expand benefits, to begin to offer benefits to part-time workers, which we've never done in our state. And that becomes a real catch-22.

INSKEEP: Are you saying that you would end up losing money? I mean, you're being required to spend more money than you'd actually get in that area?

Gov. SANFORD: Yeah. I'm saying if you already have a fund that you can't sustain, that you're going to the feds to borrow to keep operating, and yet the idea of going, expanding yet those benefits again to be eligible for yet more federal funds becomes, like I say, a catch-22, because ultimately those loans have to be paid back.

INSKEEP: We're talking with Governor Mark Sanford of South Carolina.

Governor, you're just describing what some people I guess might call an unfunded mandate, at least over the longer term. But let me ask about the politics of this, because many Republican have stood strongly against this stimulus which the president has portrayed as necessary in an emergency. What's the political risk for Republicans saying no here?

Gov. SANFORD: I suspect the political risk is that it works and, you know, Republicans look like whiners at minimum and obstructionists at worst.

INSKEEP: And is that a serious possibility a year from now, two years from now, when it's election time again?

Gov. SANFORD: It's always a possibility. But I think that if history's any guide, and I think there's a fair amount of history both in our country and outside of our country that suggests these kinds of things don't work. The Congressional Budget Office itself has said that this is more of a spending bill than a stimulus bill, that many of these dollars won't be reaching the financial bloodstream of our country for quite some time.

INSKEEP: Do you think that next year, or let's say 2012, a presidential election year, that people are going to be talking about whether this particular bill that was passed succeeded or failed?

Gov. SANFORD: I think they will. And I think the bailout to GM is a perfect example of why. You know, we were told, hey, if you just provide these billions of dollars to GM, they can avoid bankruptcy. They'll go through restructuring, and they'll be off to the races. In fact, they come back, literally a matter of weeks later, and they say, look. If you don't give us another $25 billion, we're going bankrupt. The first stimulus package, it did not work. If you look at the TARP funds that had been offered to the banks…

INSKEEP: Although that was always assumed in GM's case that they were going to need more money. We should clarify that. But…

Gov. SANFORD: I don't know that that was assumed. That was certainly not, you know, the words used in the debate. What we were told in that debate was, look, if they just got the money, they'll be able to begin the restructuring process. And nobody was anticipating that literally a matter of weeks later, they'd be coming back and asking for yet another $25 billion. If you look at the TARP funding…

INSKEEP: Mm-hmm.

Gov. SANFORD: …at the same time that all this money has gone to the financial system and to banks, as of Friday, bank stocks were hitting yet new lows, which says that there's a real disconnect between the money that's gone into the banking system and what the equity markets are saying about the prospects of banks.

INSKEEP: Governor, thanks very much.

Gov. SANFORD: My pleasure.

INSKEEP: Mark Sanford is the Republican governor of South Carolina. He's in Washington, along with the nation's other governors.

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