How "Closed Session" Betrays the Public Trust

by Lewis Loflin

In the coal counties north of Tri-Cities the poverty on paper did go down some because so many receive government money or government jobs. But it's more insidious than that. As much as one-third of the population in those counties work for or contract to government and the population has sharply fallen due to out-migration.

Many getting those government jobs are brought in from outside the region. This greatly improves the paper average. There are also many non-profits that have been set up simply to funnel government grants to them. The reality in Southwest Virginia in many places is a government job or Burger King. While there has been some rebound in the coal industry, the number of true private sector jobs continues to decline.

And what do I mean by "true private sector jobs?" Those jobs that are not subsidized or depend on government spending in some form. This can be everything from contractors building state roads, people working for the county government as teachers or trash collectors, to the local hospital that mostly serves Medicare and Medicaid patients. Add in the hundreds of millions of dollars spent on social programs and economic development to "revitalize" the regions we are talking about big money.

Typical is Grundy, Virginia the County seat of Buchanan County. They spent $200 million on a flood control project, then the County Industrial Development Administration spent $21.8 million for a parking garage for Wal-Mart. Yes that's $221.8 million on a town of 1000 people in a county that lost over 10% of its population from 2000-2010. And that was while the money was pouring in from the taxpayers.

Another good example is the Coalfields Expressway. At a cost of $2-$3 billion it will have the tallest bridges in Virginia in the least populated part of the state, most of the money going to outside contractors such as Halliburton . Another example was a $2.2 billion out-sourcing contract handed to a firm to locate in Lebanon Virginia (Russell County) that promised 1000 new jobs that never materialized. The firm got an addition to the lucrative state contract tens of millions in subsidies for as little as 200 jobs. Then there's hundreds of other little government deals handing out tens of millions in public dollars that for some reason produces little for the public good.

Power is money and those with the power get the money. The real political power is who controls that massive government cash flow and that power is handed to unelected, politically appointed boards often in partnership with local business interests. The potential for corruption is immense due to the stupidity of Virginia law that allows government agencies working with private sector business and consultants to call "closed session."

This insidious process of "closed session" bans the press and public from attending the meeting and where written records don't have to be kept. It's through these "closed sessions" that tens of millions in economic development grants, etc. flow into the bank accounts of private businesses and non-profits. Many of these non-profits are setup by these very people and local officials for the sole purpose of getting these grants. The grants are often state/federal, but can include local funds as well.

2010 SW Virginia Census

Look at the table above based on the 2010 census. The counties with the highest levels of government "investment" lost the most population. Buchanan and Dickenson Counties got Halliburton deal, Russell County got the big out sourcing contractor Northrup-Grummon. Buchanan County also got a $200 million flood control project for the Town of Grundy, population 1000, and even $2 million to build a parking garage for Wal-Mart. That's over $200,000 per resident. Lee County got a big Federal prison.

To this day government agencies tasked with job creation claim the creation of 12,000 new jobs over the last 20 years in the very counties that lost population. When I contacted them for proof of those claims, they backtracked and called them "job announcements" and that they don't track employment levels or pay scales. How the hell does somebody pay a company as much as $100,000 a job and not track them?

But notice Washington County Virginia that actually had population growth from 2000 to 2010 and huge increases in government spending and government employment to boot. It got none of the big billion dollar spending programs the others did.

A lot of that increase was due to an influx of more affluent retirees while economic development went for leisure, recreation, and amenities for rich people along with generous corporate welfare. The poverty rate actually went up and it's no surprise between 1997 and 2007, falling back to 1980s levels, while the others improved a little or stayed the same. (That was due to out migration in my view removing those that were unemployed.)

Lee County got a big Federal prison and most of those jobs went to outsiders because according to one official I spoke with most local residents didn't qualify due to criminal records, drugs, or lack of education. That's total nonsense, the jobs were never open to local residents. Note that according to the Virginia Department of Social Services the poverty rate never went down in Lee County.

What conclusion can one come to here? The average citizen is simply bypassed and ignored. And because of closed session we never know when they are handing out the funds until after the fact, then because these are private firms the public has no way to track the funding when they get it. Add in nepotism and a poorly educated population, we have all the making of a third world culture.

In summery the jobs and money go not only for corporate welfare and lucrative contracts to private firms, but also to welfare agencies, universities, and all kinds of non-profits. This shadow industry operates outside the mainstream economy and bypasses the vast majority of residents in need of basic services and a stable income. But by themselves the Progressives couldn't pull this off without help from the business community and local government. They work together.

Until we begin to address wage and labor conditions and break this corrupt Progressive-business-corporate complex, there is simply no hope of improving conditions in this region. No amount of money will ever work.

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