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Most local leaders have worked through the optimistic “doing more with less” phase. Now, many are figuring out how to do less with less.
They are lighting out into new territory where the terrain is neither familiar nor welcoming.
Almost all cities will handle the financial stress. Budgets will be balanced. But, as one former mayor used to say: even if you balance your checkbook, that doesn’t mean you’re putting food on the table for the kids. Beyond the budgets, it’s the people and the place that matter.
Short-term it’s not. Five to ten years seems to be the conventional wisdom as to how long the Great Recession and its aftermaths will focus our attentions.
There’s no way to know where we’ll be when this round of travails ends. It’s just not credible to think that the “business cycle” will go fully ‘round and take us back to 2006. You can’t step in the same river twice, and the second dip may be more treacherous than the first.
No time like the present, then, to imagine what may be in store, to stress test local and regional systems for capacity to weather probable scenarios. Such sidebar efforts, running parallel to immediate agendas, require a different kind of thinking and leadership.
So long as local leaders were in airbag situations—saved from devastation but temporarily stuck in place and unable to see ahead—they dealt with the immediate and urgent.
Now, it seems, that situation has changed: the money crunch is, in many places, more harsh, but the vision and maneuverability have returned.
At the recent NLC Congress of Cities, public talk at workshops and private chats in the hallways included comparing notes about shared services, the effects of personnel reductions, consolidations, and regional approaches. “Participatory budgeting”—serious mechanisms for engaging citizens around budget questions and longer term priorities—got lots of attention. And the question of whether temporary cuts are really permanent was debated.
Kalamazoo, MI, and its neighbors, for instance, started early to look ahead. Beginning in 2009, conversations among leaders in the two main cities and the county helped create what the initiator, vice mayor Hannah McKinney, describes as “an environment of awareness.” Inter-jurisdictional structures are now in place so that, as contracts expire, purchasing is consolidated.
Larger agendas in the Kalamazoo area are in the talking stage as huge deficits loom. “Shared sacrifice,” McKinney says, “is a great concept but in every case, some jurisdiction is making a bigger sacrifice for no apparent short run or medium run reward.” Nonetheless, the multi-jurisdictional conversations continue for a long-haul effort.
Looking Backward and Deeper
“New normal” is not the way to think about this situation. NLC’s Director of the Center for Research and Innovation Christopher Hoene, says that the phrase ignores history. He’s looked at the data over the past 30-40 years and the “reality is that we’re returning to an old normal.” The unusually rapid economic growth of the decade from the late 1990’s onward was “a blip on the curve.” It allowed us to ignore “a lot of underlying challenges in our system of public finance,” challenges that the Great Recession “violently unmasked.”
Eleven years ago, NLC set up its own sidebar discussion to take a “longer, deeper” view of public finance nationally. A brief report highlighted some of those “underlying challenges,” items that by now are not new but, importantly, are also still not adequately addressed. (It also set in motion a new agenda of NLC research, advocacy and assistance that is still productive.)
The 2000 report, written amidst the temporary economic boom and bubble, warned ominously that “big and unnoticed changes beneath the surface will become increasingly dangerous when the rising tide starts to ebb.”
Well, the tide went out in 2007-08, and we can see clearly, for example, that the system for raising public revenue has not kept up with the changing U.S. economy; that changing municipal roles put new burdens on local budgets; that infrastructure and other investments lag badly; that great inequalities have accumulated and harm societal functions; and that our dysfunctional intergovernmental system isn’t resilient to great shocks.
Shocks from these and who knows what other surprising challenges, good and bad, may be slouching toward us even now. It’s beginning to look a lot like a long slog ahead. So, unconventional thinking, scenario planning and wondering what short-term actions will mean for the longer term seem in order.
Bill Barnes, director for emerging issues at NLC, can be contacted at [email protected] Previous columns are collected on the Emerging Issues webpage at www.nlc.org at the City Solutions menu. Email: [email protected]