Bonds Are Debt – Not Revenue — and There's Nothing Vibrant About Debt

“If we don’t use bonds, how do we pay for all this?”

“I’m not hearing any ideas from you?”

I get these questions quite often. These questions are referring to new parks, recreation centers, roads, bridges, critical maintenance, all things on the shopping list coming from Mayor Mike Johnston and Denver City Council in pursuit of more debt for the city.

We pay for all these the same way governments have been paying for things for thousands of years now – with tax money.

Money from the people to the government is the only way to pay for all things government. Regardless of whether we call this “a tax,” “a fee” or “a fine,” it’s money from the people to the government.

From this revenue, we get done what we prioritize. This is the only way all things government are paid.

Bonds are debt – not revenue. Bonds pay for nothing. Unfortunately, our politicians keep telling the voters: “We must use bonds to get this done.” This political nonsense is being radiated throughout Denver’s echo chamber. The idea that debt will give more to the city is pure nonsense.

Our politicians are busy gaslighting the voters by saying that this park, this recreation center, “was paid for by such and such bonds.” This just isn’t true.

Tax money paid every single penny for that park and for that recreation center. Bonds are a document representing debt, they’re not revenue.

Banks lend money to our government. This debt needs to be repaid, every single penny. This is how the banks make enormous profit – by taking our money. Banks pay for nothing.

Bonds are just like credit cards. To claim that bonds pay for things is the same thing as saying, “My credit card pays for things.” A credit card is a piece of plastic. A credit card pays for nothing, it’s only a tool to document how much money you owe the bank.

YOU pay for every penny when you use that credit card – you know this. Please also know that WE, the Citizens of the City, we pay for every penny when we use bonds. Bonds pay for nothing.

When our politicians give credit to bonds for paying for things, they are doing two things. First, by not giving credit to the taxpayers, they are disrespecting the taxpayers. Second, they are giving the credit to the banks — bonds and banking are the same bucket. Banks pay for nothing.

For the politicians to claim that bonds pay for things, as they always do, this is just deception – political and financial deception. To praise bonds is to praise debt.

“Well, if we don’t use bonds, how do we pay for all this?”

By prioritizing. This is what gets anything paid for, prioritizing and getting it done. For example, Denver City Council decided that it should spend $70 million for a new soccer stadium, so it approved this expense – because it prioritized this project.

Unfortunately, our politicians and their financial staffers are prioritizing the banks. Most politicians never talk about this financial reality. This November, we need to cut the banks from the budget; we need to stop prioritizing debt and debt service.

We buy more things for the city when we do not use debt. We should not give our city’s budget money to the bank. We buy a lot more park, per dollar of tax revenue, when we do not use debt. Basic math, my friends.

“So what’s your plan then?” I’m asked.

Well, you are the plan. You’re living this plan that you’re asking about. Every time you pay sales tax at the store, at a restaurant or at the bar, you’re living this plan that you’re referring to.

Every time you pay property tax, you’re living this plan. And we all pay property tax one way or another.

If you rent, you’re paying property tax every time you make that rent payment. Property taxes are costs that are covered in your rent check. Money for the owners of that property to pay property tax doesn’t grow on trees; it comes from your rent check.

YOU are the plan that you’re asking about. The money comes from you. This is how parks get paid. This is how critical maintenance gets paid. This is how all things government get paid. Revenue is the only way to revenue, and there is no other way.

Unfortunately, our politicians are wasting enormous amounts of precious time and millions of dollars as they campaign for more debt. More expense in pursuit of more debt – exactly backwards.

The politicians talk about what they will buy with the new debt while never talking about how much money the debt will cost. When we use debt, we use twice as much tax money, on average, before we have the bank paid back.

When we use debt, we take our city’s budget and we give it to the bank. Government debt exacerbates our budget problems. Every dollar we give to the bank buys just as much for the city as every dollar we throw into a trash can.

Government debt is a counter-productive waste of valuable money.

When Michelangelo made David, he said, “David was already there, I just removed everything that doesn’t belong.” The answer to how we pay for things is already there: We just need to remove the political and financial deception to see the answer.

Mayor Johnston, Denver City Council, you’re throwing away our tomorrow and the next day. There’s nothing vibrant about debt.

Jason Bailey is the founder of Citizens for NO New Debt, a non-partisan public service campaign working to push back on government debt at the state and local level.

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