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Thread: Is it time to re-invent government?

  1. #1
    Cyburbian Cardinal's avatar
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    Is it time to re-invent government?

    Local budgets have been hammered by rising costs and (in many states) caps on revenue for some years now. In the past year or two states have felt the pain of declining revenue and the snowballing of gimmicks they have used for years to get to a "balanced" budget.* This past year nearly every state (except for ND) had a budget gap. Closed in mid-year sessions, the gaps only reappeared by autumn. Going into 2010, there are at least 36 states that have budget gaps, and it is predicted that every state will face the problem before much more time passes.

    Last year the federal stimulus money went a long way toward plugging the holes. Most of those funds are gone and there has not been much interest on the part of Congress or the White House in bailing out the states. Some states have raised taxes and fees, and others are considering it. (A group of Republican lawmakers in Virginia is talking of eliminating the state corporate income tax... huh?) Nearly every state has made significant budget cuts. Besides the easy steps of shifting the burden to local government, they have cut payrolls, closed state parks, released prisoners early, reduced offices, etc. Now there is talk of reducing social welfare funding, and cutting funds for schools and law enforcement - the darlings of the last decade (or more). What I think this is all getting to is a real discussion, for the first time in decades, of what is the role of government.

    What do we demand from government, and what do we desire but may be willing to sacrifice?
    Yes, we like that we have fancy ballparks with lighting, concessions, and stadium seating, and a district that coordinates a half-dozen baseball programs for people of all ages and physical abilities, all at a cost of several million dollars to develop and tens of thousands annually to maintain. It sure is nice to have the streets plowed in the morning, but would it be that much of an adjustment if plowing did not start until 5 or 6 AM, and local streets were not plowed if the snow totals were less than 2-3 inches? What if we did not have community fitness centers, bike trails, or a local access cable station?

    How should our government be more efficiently organized?
    Are we willing to eliminate the extra layers of government? Do we really need a city parks department and a regional parks authority? How about a city and county police department. Are we willing to force small school districts to combine? There is the potential for significant savings from combined administrations, centralized dispatching and fewer police stations, etc.


    This is a lengthy lead-in bringing me back to my central thesis: during the next few years we are going to have to make some fundemental decisions about government at the local, state and federal level. These decisions will deal with both the role of government and how it is organized and funded. As planners we may play an important part in this debate. How do you see government reorganizing?



    * As an example, states frequently incur costs in the current year while pushing the payment to the next, when "there will be more money". Except, of course, when revenues decline. More money is itself another gimmick. Make a rosy prediction of your income and then you can say the budget is balanced. Inadequate funding for state employee pensions is another financial trick they have used, among dozens of others.
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  2. #2
    Cyburbian DetroitPlanner's avatar
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    Yes, but it is easier to get re-elected if you bury your head in the sand and plug holes in the dike. The poop has rolled downhill.
    We hope for better things; it will arise from the ashes - Fr Gabriel Richard 1805

  3. #3
    Cyburbian
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    Just yesterday, one newspaper (local or national I don't remember) was saying that municipal bonds are still a safe investment and I think more money will be pumped into those bonds from investors. Although municipal bonds are only one form of financing projects, municipalities, counties, special districts, and other forms of government will see a significant decreased in funding from the state and federal governments. I think that will carry for the next 3-4 years as state governments start building up their cash reserves.

    I think local governments would rather layoff more workers before consolidating with other governments: it's much easier and doesn't involve so much red tape. The problem is that you still have multiple agencies with similar authority (the park district versus the municipal parks department or the county assessor and the township assessor). When you get rid of everyone, all you are left with are the elected/appointed officials, the executive director, and some administrative staff.

    Taxes will go up. Inflation (perhaps hyperinflation) will finally kick in. Commercial lending will eventually come back, but I think the only improvement we will have is our savings rate as consumers might go up 1 or 2 percentage points, and that is relative to the years we were in the hole. Many of us will revert back to what we were doing, because that is what we are most familiar with. Our saving habits changed not because we wanted to prepare for ahead, it was because we were denied all other credit to pay for things right now.

    Politics aside, the federal government does not have an obligation to fill in budget gaps, unlike the state or local governments. I think there will be fewer federal hires, if not a gradual reorganization of agency by agency, where ineffective and unproductive federal workers will finally be shaken out of their jobs. This will help somewhat, but not as much as the reorganization of the tax structure. I think we are going to be seeing far higher levels of taxation similar to the 1970s over the next decade or so.

    As for me, I'm just trying to save as much $US dollars that I can, and hopefully transfer it to some other currency down the road.
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  4. #4
    Cyburbian btrage's avatar
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    It is not time to reinvent government. It is time to reinvent the revenue streams for local and state governments so that they match the expenditures and insulate themselves from economic downturns.

    Local government consolidation is often throw about here in Michigan as an answer to the state's problem. It would simply be a band-aid unless local/state governments find revenue sources that are not exponentially impacted by business and economic cycles.
    "I'm very important. I have many leather-bound books and my apartment smells of rich mahogany"

  5. #5
    Cyburbian ColoGI's avatar
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    Quote Originally posted by btrage View post
    It is not time to reinvent government. It is time to reinvent the revenue streams for local and state governments so that they match the expenditures and insulate themselves from economic downturns.

    Local government consolidation is often throw about here in Michigan as an answer to the state's problem. It would simply be a band-aid unless local/state governments find revenue sources that are not exponentially impacted by business and economic cycles.
    Aaaaaa-men, bruddah.

  6. #6
    Cyburbian Brocktoon's avatar
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    Quote Originally posted by Cardinal View post
    This is a lengthy lead-in bringing me back to my central thesis: during the next few years we are going to have to make some fundemental decisions about government at the local, state and federal level. These decisions will deal with both the role of government and how it is organized and funded. As planners we may play an important part in this debate. How do you see government reorganizing?


    .[/I]
    The Mackinac Institute did a study on school consolidation and found little if any economies of scale. You get ride of two administrators but you create three deputies. Over 10 years they found some districts were less efficient. Big is not always better.

    The focus should be what do we want government to be. In the school case do we want it smaller so it is more accountable to the local PTA and school board or larger that can offer more classes and services? For most states the economic downturn is structural and not cyclical. Thus the local government will have to decide what is vital and what the community wants and what they demand. This is not the first time this has happened nor will it be the last. Some communities will pay more, some will cut service and others will do both...depending on the values of the community. The City Of Mesa (which is rarely on the vanguard of anything) is not waiting for a rebound...they are treating the current environment as the new realty and adjusting their budget and services accordingly. Libraries are open for fewer hours, recreation fees have increased, response times are up. But the city still has no primary property tax and there is little demand for returning services to pre 2008 levels.
    "You merely adopted the dark. I was born in it,..." -Bane

  7. #7
    Cyburbian Plus
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    City/County consolidation effort going on here.

  8. #8
    Cyburbian wahday's avatar
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    Its a very tricky scenario, I agree. Consider if local governments started merging and cutting staff. That's a lot of people out of jobs who are then not paying taxes and may, in turn, start drawing down unemployment, medicaid, etc. Are there cost savings? Its hard to say in the short run.

    I'm not saying we view government as a way to employ people, though to a certain degree that is a function that governments often serve. In many other countries, this is preferable to having too many people out of work, because they start to cause other problems for government. I am saying that being too bold could just transfer the problem of too little money from the local government to individuals and households who may then return to the government for assistance.

    I'll also say (and set myself up for Old Fogey criticism) that the older I get, the more reticent I am to go down the "lets scrap all this bullsh*t and start from scratch" road. I used to be more like that. I realize Cardinal's original post is not about scrapping local government, but it does propose some potentially radical changes. I feel that, in this financial crisis, we should move carefully and thoughtfully. There are enough unpredictable variables that are setting everything off-kilter and so introducing more feels like it could tip the whole apple cart but leave us wondering which of the many changes that have taken place contributed to the worsening situation. This is not to say that NO change is acceptable, but I am more a fan of careful moves.

    I was also reading an article about other countries' public health care transition stories and one of the things to come out of the analysis is that every other industrialized nation made this transition by modifying whatever health care system already existed (even if it was not ideal). This was because the overall costs of the transition were lower than if they designed the "ultimate" system from scratch. That and that there were in some cases a health crisis to address and so time was of the essence. There is some economic term for this, but I forget what it is. Its like why VHS became the video standard of the time when betamax was a better product. More people had purchased VCRs and so when the industry had to decide on a standard, insisting that people buying yet another machine seemed too costly.

    I will say also that, at least with my experiences here in New Mexico, the idea of merging local governments under the argument of increased efficiency is not often well received by local residents. They have had 3 referendums on merging Bernalillo County and the City of Albuquerque in recent years and all failed.

    Its a worthy discussion, though! Good topic.
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