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The Plot Must Turn

In late 2009 Niall Ferguson wrote a piece for Newsweek (An Empire at Risk, December 7, 2009) that outlined a sobering sequence of decline – one the US seems to be following. Among the most prominent contributors to this devolution are runaway debt, restricted growth, high (and foolish) spending, warring political factions, low consumer (i.e. citizen) confidence, armed foreign conflict, and inequality among economic strata. I would add declining infrastructure, unwillingness to focus on the essential, a disregard for common community interests, and a general disregard for predictable outcomes. No one seems willing to reflect on even medium-term impact of these converging variables, which will bring enormous and complex consequences.

At a time when most Americans prefer debt reduction and ending unnecessary foreign conflicts, Congress dabbles in political brinksmanship bordering on criminal neglect. If Congress were a major corporation with competent management and a serious board, it would have taken action long ago. Debt would have been retired, new revenue sources would have been explored and new enterprises launched. There would be retraining, retrenching, re-visioning, and general operational restructuring. It would cut costs, eliminate nonsensical services and focus on ROI. Right the ship, THEN return to more sustainable management. Any fool knows the key is to act…now.

China holds around 13% of US government bonds and other notes. That’s leverage we should avoid. However, China has the cash and we need it…much like those hideous payday loan agencies that prey on those so far behind the 8-Ball they need cash, now. While state and local governments have done an increasingly good job of tamping down debt and balancing revenue with expenses, the trend is leading to greater contraction in services, maintenance, and community development.

As we head toward Labor Day, it seems clear that government must attend to several things. At the federal, state and local level, focus must turn to economic development. The same old tired approaches won’t work. Why? Because every state and community is offering the same things to attract commerce. Let’s get innovative.

Second, we must invest in our people, with training programs that not only build essential core competencies, but also build a public employee system that is much more efficient, effective, ethical and future-oriented.

Third, we are digging a hole from which this country can’t possibly escape without a totally ridiculous amount of economic growth, reduced spending, AND higher taxes. Rapid growth is a fantasy; this will be a slow growth decade – count on it. Spending reductions are possible but must follow a formula that has criteria grounded in a vision of a preferred future…and not a serendipitous approach driven by power and influence. Balance is the key. School districts are now charging for participation in non-academic activities. Not a new concept, but one that reflects loss of revenue for basic services. Unfortunately, many families will be unable to afford the cost of participation. Who will pick up the slack? Value added taxes will become more prominent, allowing those who desire certain services to elect to pay for them. The critical question will become, “What does this community need and what are people willing to pay for?’ Are parks more important than fire protection or police services? Who makes the call?

The question, ‘Are you prepared for challenge?’ is central to future decision making. What are the issues and challenges that are impacting your community? Who define ‘priority’ and who leads triage efforts that ultimately guide budget allocation? As a country, are we in an unrecoverable decline or can we pull out of this descent?

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).

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One Response

  1. Of course, I’d like to think we can “pull out” of our decline, but it won’t come without sacrifice. We need leaders in government who are more interested in what is right for our country than what is right for themselves or their political parties. We have gone too long with poor representation, and too many Americans distrust, and in some cases disdain, elected officials. And yet, perhaps it starts with the public. Better people need to run for office; the public needs to ask better questions of candidates and get better answers; elected officials need to be persons of integrity, uprightness, and fortitude–willing to do the right thing for the right reason.

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