Strengthening Constitutional Self-Government

No Left Turns

Ignoring a Deluge of Isolated Incidents

The choice is simple, writes Paul Krugman.  It is "between asking the richest 2 percent or so of Americans to go back to paying the tax rates they paid during the Clinton-era boom, or allowing the nation's foundations to crumble."  Noting that some state and municipal governments are saving money by turning out street lights, replacing paved roads with gravel ones, or firing teachers and shortening the school year, he argues with contempt bordering on fury that "a large part of our political class" has chosen crumbling foundations over higher taxes.

Krugman implies that higher taxes engender sturdy foundations - bright lights, paved roads and good schools.  It's not clear, however, that tax increases are either necessary or sufficient for those purposes.  America kept the street lights on, roads paved and schools open with the tax rates passed by a Democratic Congress and signed by President Clinton in 1993.  It also did so with the even lower rates passed by a Republican Senate and Democratic House that President Reagan signed in 1986. 

Explaining the failure to maintain infrastructure and perform basic public functions in terms of a single cause - too little money - neglects the possibility that some state and local governments are in fiscal trouble because they have spent their money badly.  It is not the case, however, that the relationship between the size of the public revenue stream and the quality of the public services is direct, simple and reliable.  If it were, high-revenue states would always have good roads and schools, and low-revenue states would always have bad ones.  California's roads, schools and public services are not, in fact, markedly superior to the ones in Texas, despite the fact that only a few states secure more money for state and local governments than California, and only a few secure less money than Texas.  "Twenty years ago, you could go to Texas, where they had very low taxes, and you would see the difference between there and California," Joel Kotkin, executive editor of NewGeography.com and a presidential fellow at Chapman University in Southern California, told the Los Angeles Times last year. "Today, you go to Texas, the roads are no worse, the public schools are not great but are better than or equal to ours, and their universities are good."

It would be generous to say that this other consideration, how capably and honestly states and cities spend their money, gets left out of Krugman's equation.  It would be more accurate to say that it gets kicked out.  It's not just that Krugman, and liberals generally, don't want to talk about the possibility that public funds are spent badly.  They don't want anyone else to talk about it, either.  Thus, Krugman endorses Jonathan Cohn's argument that "public employees are the new welfare queens."  That is, the problem of over-compensated (and usually unionized) government workers is, in Krugman's words, "a phony issue," just like excessive welfare payments to able-bodied adults.

The phoniness of these phony issues is not self-evident.  Phony as in non-existent?  It's not as though examples of government spending money badly are hard to find. 

  • New York City teachers, who routinely get lifetime tenure after three years on the job, can spend years receiving six-figure salaries for doing nothing while the school board and union wrangle over complaints that they are unqualified and should be dismissed. 
  • The Milwaukee teachers union, which has "one, constant focus - putting children at the center of education," has also found the time and money to sue the school district for discriminating against male employees by excluding "Viagra and other drugs that treat erectile dysfunction from its health insurance plans." 
  • In California, 12,201 retired civil servants and public educators receive pensions of more than $100,000 per year.  "Retired" is an approximate descriptor here, because California laws that allow public employees to retire in their 50s mean that many of them pocket their pensions while going on to work for other government agencies, or get hired as consultants by their former employer. 
  • Public officials in Illinois are virtuosos in the art of "pension-spiking," piling bonuses, overtime and extra assignments onto the paycheck of an employee who is just about to retire, causing his pension to leap dramatically.

Isolated incidents?  As the "isolated" incidents keep piling up, it's harder and harder to keep from wondering if there isn't a deeper problem at work.  The plural of "anecdote" is "data," as the saying goes.  Adjusted for inflation and population growth, California's state and local governments spent 21.7% more in 2006 than in 1992.  I'm still waiting to meet the first Californian who thinks the state's public services and infrastructure are 21% better than they were 18 years ago.  It would be easy to stand in line at the DMV, however, and find one who thinks they're 21% worse.

Rather than address the problem Krugman wants to deny the problem, and disparage anyone who treats it seriously.  This is not a novel approach.  Liberals have a long history of insisting that it is not just mistaken but illegitimate to challenge their enterprise by dwelling on inconvenient facts.  Today it is extravagant compensation of public employees and the ineffectual, wasteful expenditure of public funds.  In years past it has been the excesses of the welfare system or the ways school busing exacerbated racial tensions.  Liberal efforts to rule discussion about rising crime out of order were so strenuous that conservatives were forced to ask, if "law and order" is a code word for "racism," what's the code word for "law and order"? 

Before being stampeded into raising taxes or increasing deficits to prop up failing governments, conservatives today want to know when the accumulation of data about governmental malpractice becomes a legitimate issue, one that engages rather than enrages liberals who say they care about making government work.  Is there nothing more to that caring than seeking more and more money for government?  Doesn't using the money well and wisely have a claim on our attention, too?


Discussions - 9 Comments

Glenn Reynolds at Instapundit posted a link to an interesting article:

http://www.city-journal.org/2010/20_3_muni-bonds.html

More "inconvenient facts."

More and more I'm convinced liberals know darn well the train is heading for a cliff, and that some very bad times loom ahead. My sense is they're laying their chips on the long odds that somewhere we'll emerge from the darkness and the "reforms" they've instituted will be still in place.

Pardon my mixing of metaphors.

This site:

http://www.usgovernmentspending.com/downchart_gs.php?year=2000_2012&view=1&expand=&units=p&fy=fy11&chart=H0-state_H0-local_H0-fed&bar=0&stack=1&size=m&title=US%20Federal%20State%20Local%20Debt%20As%20Percent%20Of%20GDP&state=US&color=c&local=s

states that state and local debt as a share of domestic product has gone from 14% to 19% in the last decade. That is regrettable, but the service costs of that change are likely not large enough to send the economy 'off the cliff'.

So an increase from 15% to 19% (a net change of +27% on a base of 15%) is "regrettable" but not enough to "send economy off the cliff."

I would agree ... if the increase in debt were stopped now. But it won't be.

Just today the federal government provided $26B to protect state and municipal governments from having to take painful steps. Odd how saving "teachers" and "public workers" warrants federal dollars, but the layoffs in my company (very large computer company) warrants nothing.

Oh ... we're not unionized. There must be a correlation there. Not sure what it could be.

*rolls eyes*

I am now 50+ years old, and I can vividly recall a time when I was less than 30 wondering why my home school district would spend money on new infrastructure but not on recurring maintenance.

The chicken, as they say, is coming home to roost. A new school emblazoned with the name of some local politician requires ongoing expenses to maintain.

"D'oh!" As Homer Simpson would say.

The simple truth is the state and local governments have been on a drunken spending spree for two decades now, and the spigot has run dry.

Time to pay the piper. Sorry. But that's reality.

Public service employees are the new "welfare queens!"

Without confusing Dante for theology, I confess I might enjoy seeing these meme/slogan concocters spend a long time, if not eternity, in Dante's first malebolge, which is a ditch filled with excrement. Better: let them hear no human discourse except propoganda, for as many years as they inflicted the public with their journa[o]listic careers.

For WV is precisely right: these mean to simply to obfuscate, i.e., to deny and demonize, whether from low motives or high ones. They soil all discourse their weapon-words touch.

State and local governments face both legal and practical constraints on their ability to borrow. They operate on a smaller scale. Their officials are commonly (not universally) of a different disposition than the United States Congress. Consider the contrast between the President and Gov. Paterson or Gov. Christie. The orgy of debt-financed expenditure you see in Washington just isn't going to happen elsewhere (though they're giving it a go in Sacramento).

One other thing. William Voegli notes that public expenditure per capita has increased by 21% in real terms in California. I think domestic product per capita has increased by more than 21% since 1992, so the balance between public expenditure and the private economy has not grown worse (if those figures he cites are correct).

Where I live, dealings with the state Department of Motor Vehicles and the auto license bureaux of the county clerk's offices are a good deal more pleasant than they were 30 years ago.

Collective bargaining in the public sector has been a disaster. It needs to be eliminated via constitutional provisions.

For the life of me I can't figure out if, in the immortal words of Alvin York, you're "fer it or agin it."

It seems you're arguing that state and municipal borrowing pales in comparison to federal borrowing. To that I say -- no doubt about that.

But with respect to the local ability to fund the debt, I'm not sure you're seeing it as potentially troublesome as me.

There's no doubt DMV is better than it was. Here in AZ the DMV website is actually well designed and keeps me from having to go in. But I doubt there's much borrowing in support of that.

The issue is going to be employment and long term employee obligations. There's simply no way they can be sustained. The localities can't meet the obligations and the populace can't afford to pay the increased rates. Something has to give. And it's going to be ugly.

I hate this "Captcha" thing ... 4 out of 5 phrases are utterly undecipherable.

Another alternative explanation for crumbling infrastructure is that State and local governments intentionally cut back on the most necessary services in a bid to upset voters and bolster calls for higher taxes. I know that local school districts routinely target the most essential services to wring ever more money from district property owners.

Our mistake is that we've allowed people to make public service a career. Government employees of all stripes are intensely self-interested, interests that usually trumps their sense of public duty and responsibility. There are two solutions: 1) term limits for elected officials at all levels of government, and 2) a ban on public employee unions (including police and fire).

Unfortunately, these things will be very difficult to accomplish.

I've been hearing about "crumbling infrastructure" for around 30 years now. One of John Anderson's planks was an $84 bn [?] fund for public works. I can still hear him pounding out the words, "THE LEAKY WATER MAINS".

I have friend who retired about 10 years ago from the S.F. Bay Area to the Sierra Foothills near Folsom to small town with houses on about 3 to 5 acres. When my friend first moved there he noted quite a few "younger" men (around late 40's early 50's) who lived in the houses nearby them. My friend saw these "younger" men around daily playing golf, going out in their bass boats and having a great time. My friend assumed that they were products of the Silicon Valley - got lucky with a startup and made millions in stock and were enjoying the good life at a young age. After a few years and getting to know them, my friend found out that they were "disabled" California State Prisons guards. They were receiving full salary and benefits while they were "disabled". Some of them had been "disabled" for years. Welfare Queens? I say Fraud Kings. But the California State Prison's Guard Union is very powerful. By the way they are backing the biggest State Welfare Queen of All - Jerry Brown. The Governor who enacted the Dill Act in 1978 that allowed them to Unionize.

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