Jobs make local governments work
October 9, 2012
"The Golden State remains a center of robust innovation and is leading the nation in job growth." — Gov. Jerry Brown
The American city is in peril. Since 2008, America has experienced abnormally high unemployment rates, foreclosures and bankruptcies due to dramatic shifts in the economy, among other reasons. America's recovering, but according to CNN, only 96,000 new jobs were added in August.
Many county, municipal, town, and township governments, etc., which comprise about 89,500 local governmental "units" nationwide (Source: U.S. Census), must struggle with the question of who gets what, when, and how in a troubled economy.
Pitifully low or no paychecks mean low purchasing power for many Americans; lack of workers' incomes in turn means lack or reduction of government revenue; and lack of revenue leads to the elimination or reduction of certain government services. So, the lack of producing new goods and services in the private sector hinders economic growth, which adversely affects the financial health of local government.
If local governments weren’t so hamstrung by state and federal regulations, America’s stagnant cities could flourish once again.
Focusing attention on their budgets to avoid bankruptcy, many county/city governments have had to make debilitating cuts to various services to compensate for dwindling revenues. Undoubtedly, there are a multitude of ways to utilize the interests, energy and experience of the private sector, government and labor to boost productivity. However, it mainly boils down to jobs. Job creation multiplies and diversifies a city's division of labor, increases buying power, and local governments benefit as a result.
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Not only do new jobs expand on the production of already existing goods and services leading to a vibrant economy, but jobs can also lead to a solvent government. Widespread employment can get America out of its economic morass.
To survive and thrive, the nation needs to get back to working again. And for cities to grow, it takes a curious mix of interrelated economic factors. The factors of production — capital infusion, entrepreneurship and technological know-how — create a multiplier effect that can reinvigorate an otherwise economically stagnant city.
Revitalization can replace the abandoned factories, polluted environments and rundown municipal facilities, with opportunity, hope, and a better quality of life.
Of course, there are many roadblocks to urban growth. All major cities have been reshaped to some degree by demographic shifts, changes in their economies, and the powerful interventions of the federal/state government. If local governments weren't so hamstrung by state and federal regulations, America's stagnant cities could flourish once again.
Local governments need money. But they're getting less. Why is that? It's because some simply spend too much. In addition, money that otherwise could go into California's local economies in the form of wages and taxes, instead goes into the pockets of large corporations, two-thirds of which pay no taxes at all. Also, free traders have exported many American jobs through outsourcing leaving numerous communities destitute.
Furthermore, companies that perform poorly on Wall Street aren't bringing in badly needed tax revenue to their respective home states. And the wealthy hardly pay taxes.
In fact, raising taxes remains anathema to most Americans, so much so that some California local governments are forced to utilize legal "extortion" methods by threatening little or no service(s) if a particular revenue-generating (tax) measure isn't passed by voters.
More local governments are becoming creative at raising revenue. Take parking meters, for example. Motion sensors on some new parking meters can determine if a car is still there when the meter expires, and the expired meter then automatically takes a picture of the car's license plate. And the sensor resets the meter to zero when a car leaves, so that another car doesn't get any free parking time.
Cities attract people seeking culture, education, wealth, power, economic opportunity, "creature comforts" and a better life. Yet, city life isn't without problems. Most cities have undergone racial conflict, severe social problems, and overburdened services. America's cities have been through the mill. Things are liable to get worse before they get better.
Assuredly, the resilient American city will still continue to be at the core of political, economic and social change. The future American city will always have its lion's share of intractable problems. But the stairway to healthy economic urban growth often involves obstacles that go begging for solutions. To progress economically, problems must be effectively addressed.
There can be no utopias without politics. Politics isn't a cure-all for the problems confronting the American city, but at least politics is the "management of conflict," and if anything can be said about today's city, it's a conflict zone requiring considerable "management."
David Briceno lives in Grass Valley.