Westmoreland's challenger says it's time to stop the bleedingBy SARAH FAY CAMPBELL
Chip Flanegan is running for Congress in order to “go up there and teach them how to balance a budget.”
Flanegan, of Jonesboro, is running for the Georgia Third District seat in the U.S. House of Representatives that is currently held by Cowetan Lynn Westmoreland.
There is no Democratic candidate, so the race will be decided in the July 31 Republican primary.
“I’ve balanced my budget for 32 years and ... they just can’t seem to do it in Washington,” said Flanegan, who owns an equipment rental business in Clayton County.
In fiscal year 2011, the U.S. took in $2.3 trillion, but spent $3.6 trillion — a deficit of $1.3 trillion.
“You would think $2.3 trillion is enough,” Flanegan said. “They just don’t seem to get it.”
Flanegan has lived in or visited several foreign countries, and “I have seen what happens to countries that continue down this path,” Flanegan said.
He was in the former Soviet Union on a mission trip after the collapse of the ruble.
“It’s a frightful thing to see,” he said. “We were going to the orphanages and the old-folks homes — those were the two groups of people that were suffering, the people that were depending on the government,” he said.
Flanegan feels he is particularly suited for Congress because of his business and life experience.
His business was struck by a tornado in 1985. And just a few years later, in 1988, it burned.
“Really, most businesses don’t survive a tornado or a fire,” Flanegan said. “It pretty much takes them out. We made it, we didn’t lay people off,” he said. And eventually, they were able to expand.
Flanegan said he was never considered himself a political animal until a few years ago. Clayton County has been beset with problems, including a dysfunctional school board that lost the school system’s accreditation. That, and other government problems, got Flanegan more involved.
Then he read a book by Barry Goldwater. In the book, “he said your small business owners have the skills to help run the government, because you know how to balance books, you know what budgets are, you know what employee problems are,” Flanegan said. The book also said that, if a business is successful, “you have already mastered those skills,” he said.
But, “the problem is, you’re spineless,” Flanegan credited the book as saying. “You won’t take a stand” because business people don’t want to lose customers over politics.
“I was like, ouch. Probably, maybe ... he’s right,” Flanegan said. “He hit me right between the eyes,” Flanegan said.
“I’m just a fiscal conservative that understands that we can’t keep spending ourselves into oblivion,” he said. Well, the country can keep spending, but in the end “it will be very painful.”
When Flanegan was in Russia, he saw a headline in the “Moscow Times,” an English language paper, about “million dollar roofs.” At first, he thought it was costing that much to get a roof replaced. As it turns out, the currency had been so devalued that the paper money was actually being shredded and used as roofing material, he said. People in the orphanages and hospitals had been working for six months without pay, he said.
“I was there. I watched it happen. That is the road we’re on,” Flanegan said. “We either adjust and stop spending one-third more than we’re taking in, or we go there,” he said.
“The laws of economics are no different than the laws of gravity — you can defy them for only so long,” he said.
When Flanegan’s business burned, he owed about $500,000 to one supplier. “That was about one-and-a-half or two times my gross in debt,” he said. “It took me about five years of really tightening my belt to dig my way out of it and survive,” he said.
“And I operate 100 percent debt free now,” he said.
“That is what we need to get the government back to,” Flanegan said. “We need to send the whole government to David Ramsey’s Financial Peace University.”
Flanegan was asked why he is running for U.S. Congress instead of another office.
“My gifts and talents are more suited” to the congressional office, he said. “In Georgia, they’re doing OK,” he said.
Washington can be a pretty glamorous place, and a lot of elected officials get caught up in that. “I’ve already been there and done that,” Flanegan said.
Flanegan lived in Washington, D.C., for six years as a child, when his father was a crew member on Air Force One, during the Kennedy and Johnson administrations.
The state of Georgia has to have a balanced budget. “Do they waste some money? Yeah, they do,” he said. “I don’t think they’re doing great but they’re doing OK.”
“My gifts and talents are crisis budgeting,” Flanegan said. “When you burn down and you get blown downâ ¦ you start off in the middle of a recession and you go through five recessionsâ ¦ you know how to do this,” Flanegan said.
He said that he is a “number cruncher geek.”
His rental business is very similar to banking, Flanegan said. “I’m loaning you stuff” and the fee is like interest paid on a loan.
“So I do banking in the truest sense of banking, not this fractional reserve banking that we are involved with in Washington, where they are printing funny money and flooding the economy with it and destroying our currency,” he said. “I crunch numbers, that is what I do.”
Fractional reserve banking is “where the Fed loans money that it doesn’t have,” Flanegan said. “It’s an insanity system, is what it amounts to,” he said. “The government prints money that they don’t have and they put that money in circulation.”
The Fed buys treasury bills and “puts them in the bank vault and counts those as real assets,” Flanegan said. “That is what they have done with the Social Security trust fund.”
In Washington, “they haven’t suffered from this recession. They are in a boom up there,” Flanegan said. While the rest of the country is suffering, the federal government is “hiring like crazy,” Flanegan said. “That is insanity,” he said. “I can tell you — when my business burned downâ ¦ I didn’t go out hiring people. That day, I stopped spending, I stopped buying.”
“To survive, you’ve got to get your budget back down — because you’ve got to stop the bleeding,” Flanegan said. “If you don’t stop the bleeding, eventually you’re going to bleed out. These guys just can’t seem to get it.”
Cutting government spending enough to get things balanced won’t be easy. And the current people in Congress don’t appear to have the stomach for it.
“They could have stopped the spending a year and a half ago,” when Republicans took control of the House again, Flanegan said. But they didn’t.
When it comes to cutting costs, Flanegan talked about the budget plans of two airlines after Sept. 11, 2001.
AirTran made its cuts from the top. The CEO and members of the board of directors took a 50 percent pay cut. Everybody else took a 30 percent pay cut, and the airline was well on its way to returning to profitability, according to Flanegan.
Delta, on the other hand, cut its lowest paid employees. And that meant many pilots had to be retrained. “They didn’t cut their costs, they raised their costs,” he said. And a few years later, Delta declared bankruptcy.
The reduction in pay for Air Tran’s board didn’t have that much of an impact on the bottom line because it was only a pay cut for a few people.
But the emotional impact was huge. “It says, hey, look, we’re taking a bigger hit in this than y’all are,” Flanegan said. “It’s very good for morale.”
He’d like to see Congress take a 50 percent pay cut as well. And, if elected, Flanegan said he would author the bill to make it happen.
“Now, congressmen are pretty greedy,” he said. “Most of usâ ¦ we’re pretty tight about our pay. They’re making $175,000 a year,” he said.
Flanegan said that, while Westmoreland is a nice guy, he’s very vulnerable right now because of the country’s economic and fiscal situation.
“The whole Congress is not well-liked right now. They are on everybody’s bad list,” Flanegan said. “Even though you are a nice guy and people like you personally, you may be in for trouble in this election,” Flanegan said.
“We’re going to give him a good run for his money and we’ll see what happens.”