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A Redundant Confrontation

The headlines could read: “Reality strikes… again!” The phenomenon of predictable surprise comes to mind when I read of continued actions dedicated to reducing the cost of government. The overriding theme during the run-up to this mid-term election has been the not particularly subtle accusation that people in government have purposefully bloated programs for unaccountable reasons and that the citizenry must now retrieve control to restore order. It almost plays like a B movie that has an untenable plot…thin and unsupported by reality. Remember, when you poll citizens and ask if they would like lower taxes or intact Social Security and Medicaid, world-class defense, sound schools, safe water, good roads, and a secure homeland, they say YES! We want it all…we just don’t like the price.

There have been and continue to be recessionary impacts to global and U.S. economies. The dominos will continue to fall. It has been predicted that any recovery will take three to five years and its vitality depends on complex uncontrollable variables. States and communities that tended toward austerity have been hurt less than those that pushed the envelope during good times. Deceleration from a high rate of development can breed unintended consequences – many of which were not considered until it was too late. (Scenario planning anyone? Anyone?)

The Challenge of Recalibration

Recalibration during difficult times requires leaders who are clear, direct, and speak truth. I would also add that inclusion is now a critical element of this transformation. Recovery and transition requires many talented, dedicated and invested people at the table. More critically, it requires the ability to employ long-term strategic thought directed at creating stable, sustainable communities. In a recent statement, Ronald Loveridge, the mayor of Riverside California, said,

“This historic recession has forced city officials to make difficult decisions that impact the social and economic fabric of their communities. This recession is making city officials fundamentally rethink and repurpose the provision of services in their communities. Some are innovating and finding creative solutions but, regrettably, without the necessary resources, cities will continue to have a difficult time assisting their residents through these trying economic times.”

The message is clear – these trying times will continue for awhile. However, as I noted some time ago, these are not the worst times in U.S. history. Difficult and trying, yes, but not insurmountable; it just takes time and dedication to a longer-term vision.

A National League of Cities research brief recently stated that 87% of city finance officers report their cities are worse off financially than in 2009.  The report stated that city revenues generated from property, sales, and income taxes, will decline 3.2% in inflation-adjusted dollars. The report states that cities will continue to struggle for several more years, which I predicted in this Blog many months ago (as have many others). Bob Herbert has written a superb article in the New York Times entitled, ‘The Corrosion of America.’ (NY Times 10/26/10) Pertaining to water systems, it expresses not only the need for a totally renovated U.S. water system but also that such an effort would generate a combination of jobs, greater security, and contribute to a social/ structural underpinning that is rapidly declining. In most surveys, people express a willingness to pay higher fees to ensure safe water; the cost is growing every day we defer needed maintenance.

This signals a new period in American governance. Especially in this educated democracy, citizens can certainly understand what is at stake, IF they have the information. What contributes to quality of life? To sustainability? To safety and security? What services are first tier, second tier and, just perhaps, unnecessary? Noted economist Paul Krugman’s recent NY Times article Falling Into the Chasm (NY Times, 10/24/10) again made a clear case that, after every serious financial crises, there is a period of very high and protracted unemployment, as society and the economy re-center. This was predicted and is occurring. What’s the mystery? It was predicted by virtually all celebrated economists based on historic response to crises. The question is, What is the best method for every federal, state and local government agency to respond to the crises and the need to evolve?

Within all the rhetoric, there seems to be one constant.  Those individuals, institutions and governments that carefully plan according to a long-term vision that is based on prudent, sustainable progress have done pretty well. This is a time to seek a path of progress based on moderation. It is a time to decide on central community platforms that sustain quality of life, safety, social harmony and economic vitality. We may have to reduce expectations for a short period, but the future will come whether we’re ready or not.  Are you simultaneously confronting short- and long-term realities? And are there signs that your community is prepared for the challenges ahead?

With over three decades working in and with federal, state and local government, John Luthy understands public agencies.  Known for his real world, straight talking style, he is a leading futurist specializing in city, county, state, and federal long-range thinking and planning. John is the author of Operations Planning: A Guide for Public Officials and Managers in Troubled Times, and The Strategic Planning Guide, both published by the International City/ County Management Association (ICMA). His new book, Planning the Future – A Guide to Strategic Thinking and Planning for Elected Officials, Public Administrators and Community Leaders, was released in October 2010. An innovative and dynamic presenter, John is frequently asked to speak and consult on how to prepare public organizations and communities for emerging challenges (public futures at http://www.futurescorp.com).

One Response

  1. The irony with taxes is that they are at historic lows. We seem to forget the highest tax bracket in 1981 was 70%, and that 401K plans were created by Congress in 1981 not as a retirement plan, but a tax right off for high-level executives.

    Pay taxes now and be grateful for nicely paved roads to drive on.

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