Government Communications Needs a Bailout

Most communications professionals agree that the government's efforts to communicate the economic stabilization/recovery/bailout plan were terrible from the start, and likely were at least partially to blame for the wave of public opposition that derailed the first bill and created considerable angst for many members of Congress. The messages were too long, not clear, and inconsistent. It was positioned as a bailout by opponents, who took the initiative and controlled the process.

In short, failed communication not only jeopardized the bill, but it certainly put a few more House and Senate seats in play. Given all that, one would expect that in the time since the bailout passed, what passes for communicators in goverment would be feverishly working to better explain this effort to taxpayers. Apparently not.

The Department of Treasury has a terrible website for the program (you would think something like this might merit its own government microsite) that looks like the investor relations page of a Fortune 5000 company -- no Q&A, no basic information, etc. A google search on most common terms does not yield this website near the top of the list -- just negative press for the government.

And to top it all, today I got the e-mail below from our local Chamber of Commerce that forwards a message from Treasury Secretary Henry Paulson. This letter is a perfect example of taking a good tactic -- activating chambers of commerce, business leaders and economic development officials -- and executing it poorly. Who has time to read something this long? I dare you to try to read it. In other words, give us the high points, and then link to an informative, easy to access website so we can choose what to dive into.

You would think that with all that is at stake, someone in Washington would be focused on communicating this plan to the American people. I guess they're all too busy watching the election instead.

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From: info@athenschamber.net [mailto:info@athenschamber.net]
Sent: Friday, October 10, 2008 1:51 PM
To: Brian Brodrick
Subject: Emergency Economic Stabilization Act

In an effort to keep our membership updated on the latest happenings with the Financial Markets, I wanted to send you this statement from Secretary Paulson on the efforts his office is making, what affects the legislation is having and what the global economy is doing in the days after the passage of H.R. 1424 or the Emergency Economic Stabilization Act of 2008 that passed the House last Friday. Towards the end of the article is a brief summary of what Secretary Paulson’s forecast is for the weeks ahead.

As we receive updated information on this issue we’ll send it your way.

As always, please let us know if you have any questions or if there is anything that we can do for you.

Statement by Secretary Henry M. Paulson, Jr. on Financial Markets Update

Washington , DC--Good afternoon. Last Friday Congress finalized and President Bush signed into law the bipartisan Emergency Economic Stabilization Act. The EESA provides the Treasury, the Federal Reserve and the FDIC with important new authorities to complement existing ones. We will continue to coordinate with other federal regulators to use these tools to implement our strategy to address the four key challenges in our financial markets today - confidence, capital, systemic risk and liquidity. Although we are facing particularly difficult circumstances, I remain confident that we will work through this challenge, as we have always successfully worked through every economic challenge in the history of the United States. We are a strong and wealthy nation, with the resources to address the needs we face. I am confident that, with the right public policy response, time and effort, we will conquer these challenges as well.

U.S.and global financial markets continue to be severely strained. A chain of events caused by the ongoing housing correction has reverberated through U.S. banks and financial institutions, and has seriously impacted the underlying economy, reaching American households and businesses. A root cause of this situation is the housing correction and a lack of confidence in mortgage assets, as well as a lack of confidence in many of the financial institutions that hold these assets. Because of this widespread uncertainty, investors are hesitant to commit capital to financial institutions. Investor confidence is critical to restore liquidity and enhance the stability of our financial system.

This financial market turmoil is now directly affecting more families and businesses. When banks can not finance at reasonable levels, and can not or are not willing to lend, everyone in our economy who depends on credit suffers. The capital markets are the pipes through which money flows to finance student loans, car loans, home loans and small businesses' payroll and inventory. And uncertainty and a lack of confidence have clogged our basic financial plumbing. While our actions have been aimed at restoring financial markets and institutions, our purpose is to prevent financial market difficulties from further impacting businesses and families across the country.

New Authorities Needed to Address Challenges

Over the last six months, the U.S. Government has addressed a number of significant problems on a case by case basis. In my judgment, these actions, a number of which were quite significant, were necessary but not sufficient. By September, uncertainty had led to a credit market freeze and it became clear that we needed to take a systemic approach on a significant scale, to get at the underlying cause of much of this turmoil.

We went to Congress and asked for broad new authorities to address the current troubles affecting our financial markets, including the root cause of the financial system freeze --- the illiquid mortgage assets weighing on bank balance sheets. And Congress met the very difficult challenge of providing these authorities by passing the EESA.

Specifically, the EESA empowers Treasury to use up to $700 billion to inject capital into financial institutions, to purchase or insure mortgage assets, and to purchase any other troubled assets that the Treasury and the Federal Reserve deem necessary to promote financial market stability. The new law also gives the Federal Reserve the authority to pay interest on reserves, and temporarily increases FDIC and NCUA deposit insurance from $100,000 up to $250,000.

Two days ago the members of the President's Working Group on Financial Markets, the PWG, made clear that we will coordinate the use of our existing and new authorities to restore market confidence by strengthening financial institutions, preventing systemic impact from bank failures, increasing liquidity to financial markets and keeping mortgage credit available and affordable.

Strengthening Financial Institutions

The Treasury Department is moving rapidly to implement the EESA to help strengthen financial institutions while also protecting taxpayer interests. As I have said before, the ultimate taxpayer protection will be a stable financial system that supports normal economic activity.

Towards that goal, the EESA adds broad, flexible authorities for Treasury to buy or insure troubled assets, provide guarantees, and inject capital. We will use all of the tools we've been given to maximum effectiveness, including strengthening the capitalization of financial institutions of every size. We will design programs that encourage healthy institutions to participate. Much attention has focused on the use of auctions to purchase troubled assets from financial institutions. We are moving as quickly as possible to organize and implement the most effective process possible. We expect it will be several weeks before our first purchase.

Consistent with EESA, I have appointed an interim Assistant Secretary to manage the program and begin its rapid implementation. I am currently working with the President to identify a leader to submit for confirmation, as called for in the legislation, to manage the program and help ensure its long-term success. I will also consult with congressional leaders and Senator McCain and Senator Obama during this process. It is our intent to have an appointee confirmed by the Senate as soon as possible, and I look forward to working with the Senate when they return in November, to ensure we maintain strong leadership and continuity for this unprecedented effort.

We have also identified and retained other very experienced interim leaders for the office, including an interim Chief Financial Officer. We have published guidelines on our procurement and conflict management processes. We have already sent out several essential Requests for Proposals that require 48 hour turnaround so we can contract with private sector experts --- some even as early as later this week --- who will bring complementary skills and expertise to the Treasury team.

We have several policy teams designing detailed programs to purchase mortgage-backed securities, whole loans, and equity-related instruments. In addition, we have begun work on compliance, executive compensation guidelines, foreclosure mitigation, and oversight. Our teams have already been working with Treasury's Inspector General and are scheduled to meet with the General Accounting Office. Yesterday, we held our first meeting of the program's Oversight Board and we are committed to transparency in all aspects of the program.

We will implement our new authorities with one simple goal – to restore capital flows to the consumers and businesses that form the core of our economy.

Prevent Systemic Impact from Bank Failures

One thing we must recognize – even with the new Treasury authorities, some financial institutions will fail. The EESA doesn't exist to save every financial institution for its own sake.

Therefore, a second prong in our strategy is designed to mitigate financial market disruption when a bank fails. In addition to insuring deposits up to the new, temporary level of $250,000, the FDIC has the ability to use its insurance fund and its substantial lines of credit with the Treasury to address systemic financial risk that may be posed by a bank failure.

It is the policy of our federal government to use all resources at its disposal to make our financial system stronger. In light of current conditions, the FDIC, with the full support of the Fed and the Treasury, will use its authority and resources, as appropriate to mitigate systemic risk, by, as appropriate, protecting depositors, protecting unsecured claims, guaranteeing liabilities and adopting other measures to support the banking system.

Increasing Liquidity to Financial Markets

As we address issues of capital and financial strength in our banks, we must also address the liquidity of our markets. The Federal Reserve has introduced innovative facilities and policies to enhance the liquidity that is vital to market stability, and has frequently done so in coordination with the European Central Bank. Today's announcement of a coordinated rate cut, including Europe, China and other large economies, is a welcome sign that central banks around the world are prepared to take the necessary steps to support the global economy during this difficult time. The EESA granted the Fed permanent authority to pay interest on depository institutions' required and excess reserve balances held at the Federal Reserve. This will allow the Fed to expand its balance sheet to support financial stability while maintaining its monetary policy priorities.

In recent weeks, the commercial paper market has suffered severe stress and illiquidity. Businesses ranging from financial institutions to industrial companies rely on the commercial paper market every day to fund their business activities. In particular, financial institutions sell commercial paper, and use the funds to lend to millions of consumers and businesses across the nation. In the wake of the uncertainty surrounding financial institution balance sheets, many investors are reluctant to buy commercial paper from financial institutions – in essence, unwilling to hold this unsecured debt for any significant length of time, even when the particular institution is healthy, because of the fear of not having access to liquid markets.

Yesterday, the Federal Reserve announced a new facility to provide a liquidity backstop to U.S. issuers of commercial paper. Through a special purpose vehicle the Fed will purchase three-month unsecured and asset-backed commercial paper directly from eligible issuers. I expect this initiative to significantly improve the availability of funding for financial institutions and corporations that depend on the commercial paper market. Until those that depend on commercial paper can issue it again in significant maturities, funding pressures will continue to ripple through our economy, dramatically shrinking the availability of credit to support families and businesses.

Mortgage Credit Availability and Affordability

As I have long said, the housing correction is the root cause of the current financial market turmoil. We must continue to keep mortgage credit available and support the housing market, so that we can more quickly turn the corner on the housing correction.

To provide critical additional funding to our mortgage markets, FHFA has directed Fannie Mae and Freddie Mac to increase their purchases of agency mortgage-backed securities (MBS). Supporting the availability of mortgage finance is the mission of the GSEs. There is headroom of over $150 billion between the current GSE portfolios and their regulatory limit. FHFA will supervise the growth in these portfolios, under its expanded authorities to monitor GSE risk-management. We also expect Fannie and Freddie to increase direct support to the mortgage market through their ongoing securitization activities.

To further support the availability of mortgage credit, Treasury also has established a program to purchase agency MBS directly. The program began in September. This will complement the capital provided by the GSEs and help facilitate mortgage availability and affordability.

Stabilizing Fannie and Freddie to support mortgage availability has been constructive. As the rest of our markets experienced increased turmoil the interest rate on a 30-year fixed rate mortgage has come down from its peak of 6.6 percent earlier this year to as low as 5.9 percent this week – a decrease that helps American households reduce monthly mortgage payments and increases the potential for more homeowners to refinance mortgages at lower rates. As Treasury and the GSEs increase their purchases, mortgage affordability should improve for Americans. If we were not actively engaged at the GSEs, we would have expected that rate to increase and further slow the progress of the housing correction.

International Coordination

We see evidence every day that world economies and financial markets are more connected and interdependent than at any time in history. Economic momentum has slowed substantially across the industrialized countries as a consequence of the ongoing financial turmoil, the acute stresses facing our financial institutions, continuing housing markets adjustments in the United States and other countries, and volatile – albeit moderating – commodity prices. Emerging markets are also beginning to show signs of slowing. We see evidence that the freezing of credit markets is having a tangible impact on the everyday lives of citizens all around the world.

Addressing these challenges requires the dramatic steps we are taking here in the United States and it requires strong international partnerships. Governments have and must continue to take individual and collective actions to provide much-needed liquidity, strengthen financial institutions through the provision of capital and the disposition of troubled assets, prevent markets abuse, and protect the savings of our citizens.

We must also take care to ensure that our actions are closely coordinated and communicated so that the action of one country does not come at the expense of others or the stability of the system as a whole.

Over the past twelve months President Bush and I have been in regular contact with our international counterparts, and we have collaborated in a variety of ways. This weekend I will be meeting with my G-7 colleagues to discuss the steps that each of us are taking to confront this crisis and ways to further enhance our collective efforts. In addition, in consultation with Brazil, the G-20 President, I am calling for a special meeting of the G20 that will include senior finance officials, central bankers, and regulators from key emerging economies to discuss how we might coordinate to lessen the effects of global market turmoil and the economic slowdown on all of our countries.

Although the tasks are not easy, I am regularly heartened as I work with my international colleagues who are also committed to securing stability and growth in their domestic economies, and to promoting the orderly functioning of the international financial system.

The Road Ahead

While most Americans understand that economic cycles occur, we are experiencing some extraordinary and difficult challenges at home and abroad – challenges that make it clear Congress was correct to take swift and bold action, and that we have no time to waste implementing the new law. We also know that getting it right is as important as getting it done quickly. We can and will do both. The Presidents Working Group on Financial Markets and all financial regulators are working together to achieve our necessary goal of restoring stability and orderliness to our financial markets. Every effort will require careful analysis, deliberation and transparency, and some measure of patience from the American people as we create the most effective process possible.

We have already taken a number of extraordinary bold actions on the liquidity front that I am convinced have been exactly the right policy steps, including the emergency action to provide a guarantee to our money market funds, actions to stabilize the GSEs and drive down mortgage rates, and the Fed's new program to provide 90-day liquidity to commercial paper issuers.

It is the policy of the federal government to use all resources at its disposal to make our financial system stronger, to safeguard depositors and savers, to help ensure an adequate flow of credit, and to minimize systemic risk. The Congress has recently provided the Treasury with broad powers to acquire financial assets, to make capital available, and to strengthen the balance sheets of individual institutions. The Federal Reserve has also been given new authority to ensure that the system has sufficient liquidity. The FDIC has the authority and the access to resources necessary to protect the banking system. The Treasury, the Federal Reserve and the FDIC will use all their authorities to promote the process of repair and recovery and to contain risks to the financial system that might arise from problems at individual institutions.

But patience is also needed because the turmoil will not end quickly and significant challenges remain ahead. Neither passage of this new law nor the implementation of these initiatives will bring an immediate end to current difficulties. It will take time and bipartisan leadership, cooperation and collaboration, as well as well-conceived and executed policies to overcome the challenges our nation is facing. And we will overcome them. Despite our problems, the U.S. economy is the largest and wealthiest in the world. We will, as we have in the past, emerge stronger and better able to provide new opportunities for our workers and increased prosperity for our families. Thank you.

The Train -- Is it (finally) coming?

Here at the Inbox, we've never been shy about cheering for the Brain Train. As an office full of people who make almost weekly trips back and forth to meet with associates at Jackson Spalding or clients in Atlanta, we will be dedicated users of the train the day it arrives. There is no question in our mind that when completed the "Brain Train" will have enormous economic benefits for Athens and the surrounding communities.

In the past two weeks, several events have occurred that make the Brain Train a much more likely occurrence.

First and foremost, Governor Sonny Perdue finally got on board with rail and transit, citing high gas prices and increasing use of GRTA buses. While he is focusing on a well-funded southern line first, many -- including myself -- believe that the Athens line (also known as the Brain Train) will ultimately be the more successful option given the fact that there is a destination at both ends that people will want to visit for work and play.

Second, in a move that received scant notice locally, Bill Kuhlke was named Chair of the Georgia Department of Transportation and strongly endorsed rail. Who is Mr. Kuhlke? He is our district's GDOT representative, and given his embrace of rail and the fact that he represents our congressional district, this has to be a positive for our area. It will certainly be a positive to have the Chair of GDOT looking in Northeast Georgia's direction a little more often.

This story at the Atlanta Business Chronicle offers a good idea of the many positive effects of the line will have. For Athens and its anti-poverty drive, I can't imagine anything that would be better for the local workforce than having a rail line to Gwinnett, which seems to generate just the type of skilled labor jobs we want here for the poor but can't get. The other potential benefits are enormous -- less traffic on 316; more productive commutes for anyone working at CDC, in Lawrenceville, at Emory, or in downtown or Midtown Atlanta; and a great option for tourists or those wanting to visit any of the communities along the route. From an economic development standpoint, having a strong, tangible, reliable link between all the institutions of higher education included in the map above will give us a strong advantage over many other communities.

From Athens to Asia: An Orient-ation

In recent weeks, the Georgia-China relationship has been much in the news. Governor Sonny Perdue traveled to China in early April with a delegation of 40 Georgians to talk trade and make several announcements, and also to celebrate the debut of Delta's direct routes to China.

While the AJC and many other media outlets accompanied the Georgia delegation, Northeast Georgians might still think that the only connection between Athens and China is the outstanding Chinese cuisine at Peking.

However, The Inbox recently learned that of Georgia’s 48 official delegates to China, 7 were from Athens – Maxine Burton (at left in the picture), Michael Burton, Emma Lou Hubbard (all from burton + BURTON); Winston Heard and Julia Menefield of the East Athens Development Corporation; and Steve Wrigley and Arnett Mace from the University of Georgia – and another was from Commerce: Gary Black, who is the president of the Georgia Agribusiness Council. Logically, this made The Inbox wonder about other Athens-China connections, and whether there is opportunity for local businesses in China, whether it is from a manufacturing standpoint or a sales standpoint.

Quickly, other local connections emerged:

• During the trip, the governor announced a partnership between UGA and Tsinghua University, a school of 27,000 students in northern Beijing.
• Something called the Georgia-China Alliance even lists an Athens street address as its headquarters.
• Mayor Davison visited China on a recent trip (which the local press then deemed a tourism junket).

This will be the first of a series of posts that will cover the Athens/Northeast Georgia-China relationship and what a stronger relationship with China could mean for this area.

For our first installment we dialed up two top local businesses to inquire about working in and with China, and some keen insights emerged. The two businesses are burton + BURTON, which utilizes facilities in seven countries (including several in China) but keeps its headquarters in Athens, and Tifosi Optics, which manufacturers its "enthusiastic eyewear" at five factories in China and Taiwan but does business worldwide. Tifosi is headquartered in Watkinsville. Summaries are below as well as links to the full interviews with both companies.

burton + BURTON

Founded in March of 1982 by Maxine Burton under the name Flowers, Inc. Balloons® as the balloon division of a retail and wholesale florist (Flowers, Inc.), burton + BURTON is an Athens business success story with more than 350 employees. Since its founding, the company has become the nation’s leading supplier of balloons and coordinating gift products. With an international customer base the company offers more than 15,000 different products which certainly necessitates the need for extensive and flexible manufacturing operations. According to CEO Bob Burton, the company first explored manufacturing in China in 1986, and began production there shortly thereafter. Why?

“Many of the products that we carry are no longer available from domestic suppliers,” said Mr. Burton. “If we wanted to continue to provide our customers with the variety of products they need, we had to find other sources. We also found that China was one of the few places that could meet the demand we were experiencing. Many of our products are very intricate pieces made by skilled artisans [note: see photos]. No domestic vendors can (or will) supply container-loads of hand-blown glass vases, or intricately woven handmade baskets at the competitive prices available from China.”

Bob’s wife and company founder, Maxine, was one of the delegates on the Georgia-China trip. She found it valuable for a number of reasons.

“The interaction with Chinese business leaders during the opening reception for the new Trade Office allowed us to exchange viewpoints on trade and to hear first-hand their perspective,” said Mrs. Burton. “It was also very valuable to meet others from the state of Georgia who are in the imports/exports business.”

Mrs. Burton is also a board member of the Georgia Ports Authority, which offers her a unique perspective on the two way relationship between the countries. She was quick to point out that Georgia enjoys a huge export business with China, and that containers travel fully loaded both ways, making trade with China is a two-way street. This result, she says, is a huge positive economic impact for the State of Georgia.

"It has been very eye-opening to learn the amount of products Georgia exports to China," says Mrs. Burton. "Georgia is a major exporter of forestry and agricultural products, and minerals like kaolin and gypsum. The Georgia Ports Authority has done an outstanding job of attracting business to the State, resulting in increased revenues for Georgia. Thanks to the job the GPA has done, Georgia ports are now the fastest growing ports in the United States."

There have been some lessons learned as burton + BURTON has grown and manufactured more goods overseas, and in China specifically. Consider this comment from Mr. Burton:

"There are significant challenges. Obviously there is the distance. There’s no such thing as a 'I need it tomorrow' project when dealing with overseas manufacturers. Most of our products will spend 4-6 weeks 'on the water' just getting to us. This is in addition to the time needed to produce the goods. There is also the time difference. Our working hours in the US are the middle of the night for the Chinese. When it is 8:00 am here, it is 8:00 pm in China. As a result, we rely heavily on e-mail.

"There’s no such thing as just 'going over to China to start-up operations.' Business owners who don’t spend time developing trusted relationships and learning the way Chinese businesses run will likely encounter major problems. Additionally, there is the learning curve associated with US customs and imports. Confusing trade tariffs and products 'stranded' in West Coast ports due to strikes are just two of the potential challenges we deal with."

But the most important lesson of all, according to Mr. Burton, isn't about business.

"Probably the biggest, and most rewarding lesson learned has been that when you put language, political, and cultural differences aside, our international vendors share many of the same goals as we do. We both want our businesses to be successful and to provide for our families and the families of our employees. We value friendship. We want safe places to raise our children, and a comfortable lifestyle. As we travel the world, and sit down with our international partners over dinner, face-to-face, and talk one-on-one, we see that we’re really not so different. The similarities in our overall goals make it easier to do business, despite the cultural and geographic barriers between us."

Wow. As I said, a lot to chew on, and I would encourage you to read the full interview here.

Tifosi Optics

When Joe Earley and his wife Elizabeth founded Tifosi in 2003 to provide an affordable, high-quality sunglass for the cycling market, he knew he'd have to manufacture his product in China.

"For our product category there is no domestic production for sunglasses," says Mr. Earley, who cut his teeth repping a variety of cycling gear and accessories, giving him unique insights into the needs of retailers and cyclists. "Whether they are $200 or $5, they are all made in China -- it really wasn’t that much of a discussion for us."

Today, Mr. Earley's company employs 16 at its Watkinsville headquarters, and is on a steady growth path. According to Mr. Earley, the benefits of manufacturing in China are many -- cost, quality, speed, etc. But there are challenges, especially on the communications side.

"For the most part, you deal with the factory and while the English is not perfect, as long as you are communicating through e-mail, you're okay," he says. "English is the common language for business, but it has gotten easier with Skype, which allows you to talk to them and show them the product at the same time."

According to Mr. Earley, specificity is the key.

"We’ve had products come in and not be what we expected them to be in production. The bottom line is you have to be very detailed when dealing with Asian production. Every little thing needs to be spelled out, every finite little detail, with absolutely no room for interpretation, especially from an artistic standpoint. The look and cosmetics of things is critical for our product and the judgment of our partners is not the same as an American consumer’s judgment. You can’t leave anything up to chance when specifying things."

Okay, so how does all this benefit Athens? Well, the bottom line is we have two global consumer and business products quietly headquartered in our community. While we might not get the manufacturing jobs we used to, it is doubtful whether we would have these headquarters at all without their ability to compete on a global scale -- there is no way to do that when you are mass producing goods in America that could be produced overseas. Both of these businesses return significant tax dollars and provide top quality jobs for people up and down the economic ladder in the region, from marketing, to administrative, to logistics, to executive level positions. The ripple effects of global consumer and business to business companies like Tifosi and burton + BURTON are enormous and will continue to grow -- as long as their headquarters stay here in the Athens area.

Be sure you read the full interviews with Mr. Earley and Mr. and Mrs. Burton, and stay tuned for future stories where we inquire about the American products the Chinese are using, the UGA-China relationship, what the future holds in terms of Athens-China and whatever else comes up as The Inbox researches this topic.

Many thanks to those who assisted with our research for this post, and please comment or e-mail to let us know if you know of other Athens-China connections, or have ideas on where this might go.

From Both Sides of the Aisle

The Navy School hosted members of the Athens Area Chamber of Commerce this morning (bright & early!) for a post-legislative wrap session. Each member of the local delegation spoke for a few minutes about what the session accomplished from his perspective. It was clear that the failure of the Speaker's "Great Plan" and the Lt. Gov.'s counter plan for tax reform left a bad taste in the mouths of both the houses and members of both parties. The inability to compromise on funding for the statewide trauma network and transportation improvements was mentioned in spades by the delegation.

Big news for Athens includes:
* funding to bring the Medical College of Georgia to a satellite campus in Athens
* funding for UGA's pharmacy school
* tax incentives for tourism destinations
* tax incentives for the film industry
* a water management plan

Here are the highlights from each member of the delegation and my take on each one:

Rep. Keith Heard (D-114)
- Emphasized accomplishments for UGA, including a 2.5% raise for faculty
- $10 million investment secured to bring the Medical College of Georgia to Athens with a satellite campus housed in The Navy School after it relocates to Newport, R.I.
- $1 million for a rare books collection at UGA
- Heard also referenced bills intended to boost the state's tourism efforts with incentives for companies building designated tourist destinations and one to offer tax credits to production companies.

For six years, I lived in Wilmington, N.C., known affectionately as "Wilmywood" for playing home to the popular series Dawson's Creek and One Tree Hill as well as numerous films. North Carolina created a similar incentive package to attract companies to Wilmington's Screen Gems Studios but were often unable to compete with the breaks given in Canada. It will be interesting to see if Georgia can.

Sen. Ralph Hudgens (R-47)
- Hudgens openly stated that he felt the session was hijacked by the personal agendas of Speaker Richardson and Lt. Gov. Cagle.
- His opposition to the proposed tax plans was that they were tax shifts, just taking the same money in a different manner and, in some cases, penalizing certain groups with the shift.
- Emphasized that there's no tax cut until the spending is reduced - in other words, you can't have less money and keep spending the same amount.
- He's now pushing for a regional TSPLOST for Oconee, Clarke, Barrow and Gwinnett to fund clover-leafing 316 and implementing the Brain Train.

Hudgens was the most vocally disappointed in the way things played out on tax reform. He clearly didn't support either one of the proposed plans and felt that the reform should be handled differently through tax credits issued for ad valorem taxes. It's ironic to hear a politician so riled up about the politics of politics.

Rep. Bob Smith (R-113)
- Smith was the first to mention the state's overall budget and commented that it was a good budget and good for all of Georgia.
- Smith spoke about a couple of items near and dear to my heart - including a tax credit for the rehabilitation of historic properties. He also mentioned a similar credit for donation of conservation land.
- He spent the greater portion of his allotted time talking about the partnership between Medical College of Georgia and UGA, and also noted the $4 million in funding for the University's pharmacy school.

Smith felt like the media overplayed what didn't get done and wanted to emphasize what did get done. I think they were all feeling like they'd taken a public beating for the session's failures. But Smith was very positive about what the delegation accomplished for the local area and indicated several bills and resolutions that will boost the economy or bring business to the area.

Senator Bill Cowsert (R-46)
- Cowsert admitted a lot of frustration with the lack of resolution on the tax reform and trauma care. However, he did note his satisfaction with the outcome of two of his highest priorities: the water plan and bringing the medical college to Athens.
-He noted that the Georgia Chamber of Commerce considered this its most productive legislative effort ever - a sign that business interests were upheld during the session.
-Cowsert also plugged the water plan, saying that the state was taking a sensible approach by measuring resources, managing resources and implementing a system of checks and balances between environmental, governmental, business and residential needs.

Cowsert, though disappointed in the outcome of the session in some respect, voiced his belief in a silver lining. The conversation about tax relief is open, both sides have fired, and now is the opportunity for consensus building. Ever mindful of reaching his constituents, he also led off with a plug for his campaign kickoff on Tuesday at the Oconee County Civic Center.

Rep. Doug McKillip (D-115)
- McKillip, who serves on the Natural Resources Committee, lauded the water plan and the efforts on Jekyll Island. He said both were items that he studied carefully and felt like the right people were in place to address the issues.
- While he doesn't endorse the Speaker's "Great Plan" he did credit Richardson with starting an energetic debate about tax reform. He went on to describe how he's planning to continue examining the issue in preparation for next year's session.
- He emphasized that he hopes Georgia will continue to seek progressive efforts over regressive efforts.

McKillip was last in line to speak and wasn't left with much to cover in the way of this year's session. Instead, he addressed his thoughts about the future. He's a big proponent of earned income tax credits and plans to take the time away from the Hill to examine the full-meal-deal tax system, from income tax to sales tax to property tax and rethink it.

In just an hour, I got a sense of the intense atmosphere in this year's session and the immense complexity of how government works. Nothing is as simple as it seems - and if someone makes it sound simple, you should probably start asking questions.

All in all, I have great respect for the delegation and what they do. It's clear - whether you agree with their politics or not - that these men are truly committed to doing what they think is best for the communities they serve. And we have to give them credit for raising their hands to go to the Hill and continue making this area a great place to live and work.

Thanks to the Athens Area Chamber of Commerce and the event sponsors - AAA Sanitation, Chastain & Associates Insurance, Athens Area Habitat for Humanity, Heyward Allen, and Wachovia - for putting together this informative session for the local business community.