Bacons Rebellion

Worries concerning tight bank credit and high unemployment aside, leading indicators suggest continued improvement in the economy.

When the American economy rebounds, leading the way will be the housing market. We need to make sure we aren’t placing undue burdens on the production of new housing.

The General Assembly produced a final budget that, all in all, is pretty good and sets the stage for the next step by our Governor. That next step will be reforming the way government works so that priorities are focused, and those things of less importance, or not the role of government, are dramatically reduced or eliminated altogether.

The two-year state budget has been put to bed by the General Assembly. Agreeing with Governor McDonnell to not raise taxes as former Governor Tim Kaine advocated, the General Assembly instead took actions to significantly reduce spending.

Virginia fared pretty well during the recession compared with other states.

As the crafting of the bi-annual state budget enters its final stages, there are several items the governor and the budget negotiators could look at that would control state spending, both today and tomorrow.

Extending unemployment insurance seems like a good policy, and with the unemployment rate at 10 percent and expected to go higher, it would seem that Congress should do so. But could it be contributing to the higher unemployment rate?

With the recession now over, according to most economists, the question becomes: “How long will it take to recover all the jobs lost?” Observing the employment patterns of the past few recoveries can provide some insight into job growth in the current recovery.

Government should use the current economic recession to re-evaluate its purpose, prioritize its programs, re-structure its employee compensation and permanently restrict the growth of future spending. If not, we will be right back year in a few short years.

Bob McDonnell may have won a landslide victory in his bid for the Virginia governor’s mansion, but by sometime early next year, he may well begin to wish things had turned out differently as he is inheriting arguably the worst budget crisis in living memory.