Live from Music Row Friday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 a.m. to 8:00 a.m. – host Leahy welcomed the original all-star panelist Crom Carmichael to the studio to weigh in on the reckless fiscal spending of Democrats and the deficiency of institutional constraints.
Leahy: We want to finish up this topic that Crom brought up in the last segment, which is how awful, terrible, and disgusting the so-called $3.5 trillion reconciliation bill in Washington.
Carmichael: Reconciliation. Michael, what I’m trying to get across here is some thematic things. And then just use this as an example. For example, I talked about in China, you had Everglade that took 20 years to implode.
Leahy: The real estate company.
Carmichael: Now it is imploding.
Leahy: Totally imploding.
Carmichael: By the way, we had the same thing happen in real estate in this country where you had, like, 15 years for homeownership, homeownership, homeownership. That was the end all be all.
And the reason was that everybody thought the price of real estate will never go down. Well, the price of real estate will go down if you inflate it.
Leahy: Like the tulip inflation in Holland in the 1700s.
Carmichael: There’s a wonderful book called Delusions of Crowds, and it’s about all these different bubbles. But in our country, we had the real estate bubble in 2008-2009. But it took many years to get there.
That’s the point I’m trying to make now. And here’s part of the reason. Part of the reason is a lack of institutional constraints. So let’s look at Tennessee, for example.
Our state at the state level is incredibly well governed from a financial standpoint. And that’s in part because the Republican legislature does a wonderful job. Just straight up.
Leahy: And let me just say, just straight up for a moment, I want to give a note of thanks to the late Charles Sergeant, who was head of the finance committee here. Now Charles was a crusty old guy.
Carmichael: (Laughter) He was.
Leahy: And, you know, it’s interesting he was more of an establishment Republican, and we were critical of him in several regards when it came to the gas tax. But nonetheless, he was a guy who actually, despite his crustiness at his heart, he was interested in protecting the financial stability of the state.
And I recall he passed away a couple of years ago. But in 2017, when we launched The Tennessee Star, we aggressively called him for comment, comment, comment. Finally, he said, let’s go to lunch.
Carmichael: Oh, okay.
Leahy: So Charles and I went and I bought it by the way. We went to J. Alexander’s and he went through and showed me he brought into the lunch piles and piles and piles and piles of paperwork bills he was working on.
And he said, no, every single one of these has got to have a budget element to it. It’s got to be approved. It’s got to go through our process. And he just kept on harping on this. And I say, harping, really, harping is a negative thing.
He kept repeating it. And, you know, he was a crusty old guy, but he was dedicated to the financial stability of the state. And I didn’t agree with him on many things.
Carmichael: On some things. By the way, you and I disagree on the gas tax. You and I, we just disagree.
Leahy: Let me just use a phrase that Governor Lee said when he announced his candidacy. (Whispers) Water over the bridge.
Carmichael: Okay. Oh, yes. (Leahy laughs) But you brought it up.
Leahy: I did.
Carmichael: We was the…that was you.
Leahy: It was me. Because I don’t want to attribute to you things that you don’t agree with it.
Carmichael: And I was for the original gas tax, and I was for the increase in the gas tax.
Leahy: The record stands corrected. (Laughter)
Carmichael: But let’s get back to these institutional constraints at the state level. As you point out in Tennessee, we have institutional constraints.
The Democrats, when they wanted to start spending more money and rewarding more of their constituencies, they tried to pass the state income tax, and they failed. And in failing, they switched the legislature from Democrat control to Republican control.
And I wish more Democrats who are in the legislature were a free market, limited government people, but they’re simply not.
Leahy: I’ve got one name for you. John Mark Windle.
Carmichael: He is?
Leahy: A free-market guy.
Carmichael: And he’s a Democrat?
Leahy: The only one. The only one in the entire state legislature. We got to have him in.
Carmichael: I’d love to have him in. I don’t know who he is. Let’s continue on here at the city level. At the city level, we don’t have institutional constraints.
And I heard your interview with Steve Glover, and he said the council is spending money willy nilly. And I think probably a third of our council members believe wish we did have institutional constraints.
Carmichael: One-third. I think we have about a third. And then I think we have another third who can kind of go either way. And then I think we have a third who just want to blow the budget apart and don’t even think about it.
Leahy: They don’t think about any fiscal constraint.
Carmichael: No. They look at each item and say, it’s kind of like why I don’t go shopping. If I go shopping, I tend to buy things. Well, I’ve already got plenty of stuff in my closet, so I don’t need more things.
Leahy: You don’t need more things.
Carmichael: No. But this one-third of the Democrats, they see something, they go, oh, I want to spend money on that. Then they spend money on that. And then they go to the next thing. Oh, I want to spend money on that.
Leahy: They have a lot of jun in their closet.
Carmichael: (Laughter) They have a lot of junk in the closet. That’s a great metaphor. And one that we should bring up from time to time.
Leahy: You’re welcome.
Carmichael: But at the federal level not only are there no institutional constraints against spending, but all of the incentives on the Democrat side are also to spend absolutely as much as you possibly can.
Listen to the full second hour here:
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