What is Government's Role?
And how should we pay for it?

We hold a firm belief in this country that no matter what we do, the trains will continue to arrive on time... but will they?

That symbol of government providing vital services that we've come to take for granted is in danger of jumping the tracks. Worse, as cities face dwindling revenues and fiscal crises, hasty and desperate measures to avoid a train wreck are obscuring the real issue.

As pressure mounts to cut funding, few seem willing to focus on the key issue: what the fundamental role of government should be and how we should pay for it.

Everyone wants services retained. Yet everybody demands that it be done without paying the amount necessary to provide those services.

At a recent meeting, one mayor spoke up about the desperate attempt to close budget gaps by imposing gaming and "sin" taxes. "Why don't we just determine what is needed and then tell the people what they owe?" he asked. The silence that greeted him from others in the room was deafening.

What's particularly unsettling is that fiscal shortfalls aren't just being felt by cities, which are usually the first to feel the pinch because they must try to comply with unfunded federal and state mandates. Now fundamental services are starting to grind to a halt at the state level as well. Already there are eight percent fewer local police officers in the country in spite of the fact that 78 percent of crimes are stopped by local law enforcement.

"No new taxes" sounds good. But what about "no basic services" or "no new road improvements"?

The fiscal picture city finance officers paint is bleak. Seventy-nine percent of them believe that their city is less able to meet financial needs in 2003 compared to last year.

The National League of Cities reports that in order to meet the crunch of declining revenues, 61 percent of cities are raising user fees for services, 51 percent are drawing down reserves that that they had prudently built up during growth periods, and 17 percent are laying off city staff.

The other alternative is to raise taxes. The majority of tax hikes seem to be coming at the city level, allowing state and national lawmakers to claim a false victory of not having to raise taxes for themselves. (Never mind that the burden was merely shifted to cities.) A recent National League of Cities report covering the past two fiscal years notes that federal aid to cities nationwide has declined by 19 percent. And the Fed's Community Development Block Grants for Kentucky from fiscal year 2002 to FY 2003 were down 6.8 percent. Yet, demands on cities to provide more services increase.

More frightening is that as the malaise grows, so does the apathy. We turned out in shamefully low numbers to elect candidates during the recent primary elections and still expect our lives to continue without change.

My father and his friends, all in their 80s now, vote faithfully in every election. Many of them were raised poor, without any services. They endured the Depression and served in World War II, which unlike the video-game TV battles of today had a daily impact on the lives of everyone. Do my father and his peers know something we don't – or something we have forgotten?

Lest we paint too bleak a picture, it's important to remember that there is something to the idea that with crisis comes opportunity. Our current economic woes can bring us back to restoring some fundamental responsibilities we have as citizens, with paying taxes being just one of them.

What kind of order can we shape from the current chaos? The opportunity exists to make government our own once again, to restore the image (and function) of government as the arm of the people, not their adversary.

In the 21st-century rush of constant change and technological advances, we can no longer isolate ourselves from the world at large.

If we refocus our energy on the importance of local connection and commitment, we’ll gain far more than keeping the trains running on time. We’ll gain a foothold in the future as well.

Sylvia L. Lovely is executive director and CEO of the Kentucky League of Cities.
editorial@lanereport.com

Back to Perspective Index

Back to October Issue

Copyright 1996-2003, by Kentucky Business Online.  All rights reserved.

Editorial content is copyright 2003, Lane Communications Group
All editorial material is fully protected and must not be reproduced in any manner without prior permission.

The Lane Report is a trademark of Lane Communications Group.  All other trademarks are the property of their respective owners.