Governor Calvo Claims Guam’s Deficit ‘Gone’

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Senator says government deficit only shifted to long-term debts

By Louella Losinio

HAGÅTÑA, Guam (Marianas Variety Guam, Feb. 12, 2013) – In A move which surprised those in attendance at last night’s State of the Island Address, Gov. Eddie Calvo announced halfway in his speech that the "deficit is gone" – a statement which drew the longest applause of the night, but also drew a sharp reaction from the Democrats who criticized the governor’s speech and wondered "where the deficit had gone."

"I have a special announcement to make tonight... one that I wasn’t aware of until late last week. Tonight I have the distinct honor of being the first governor in 23 years to tell you... that the deficit is gone," Calvo told the assembled body.

A $10 million surplus, the governor added, will be reflected in the fiscal year 2012 audit report.

This drew surprised and amused reactions from Democratic members of the Legislature, who were still questioning, right after the address, where the deficit went.

"I know a couple of months ago, last year, we spent a month having a dialogue, having a roundtable – trying to get the Retirement Office to work with the Governor’s Office. At that time, there was supposedly a $73 million deficit," Speaker Judith T. Won Pat said in an interview with Variety.

She said she is looking forward to getting the details about the so-called "eliminated" deficit.

Long-term debt

Sen. Rory J. Respicio also said pointedly that the governor’s announcement needs to be followed through with the recognition that this deficit was shifted to long-term debt.

"What I asked the governor to do is to continue to recognize that you can’t simply borrow upwards of $400 million and call it a day and claim that there is no deficit," Respicio said.

If the reported $10 million surplus is true, Respicio said he will renew his call for the governor to address outstanding GovGuam obligations, including what’s owed to the Judiciary of Guam as well as outstanding vendor payables that needed to be paid out.

"It doesn’t make sense for the government to withhold those kinds of payments to these people, just as in the case of tax refunds, and to carry a surplus and be very proud about it," Respicio said.

Carlo Branch, executive director to the Democratic Party, also believes the deficit is not dead, as Calvo claimed last night.

"It just turned into a $2 billion debt," Branch said laughingly.

[PIR editor's note: Guam's Democratic Party has also slammed Calvo for his administration's "loose relationship with the facts" in relation to job losses from 2010 to 2012, of which 740 were private sector positions.]

Applause

As in previous state of the island addresses, the governor’s speech was punctuated by enthusiastic applause from the Republicans and members of his Cabinet.

Despite the accomplishments of his administration that Calvo enumerated, the governor also admitted the fact that at least 45,000 people on the island are still living in poverty and not earning enough to eat without government assistance – a number, Calvo admitted, which has quadrupled in the last 20 years.

Addressing the issue of poverty, the governor also noted the importance of community-wide education reform efforts, spurring economic activity through private sector involvement, and community development initiatives.

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