A story to keep an eye on as the “Great Recession” continues to unfold is the city finances and cutback in services of Colorado Springs, Colorado. While many local governments and states are facing bankruptcy due to spending levels that cannot be met with dwindling tax revenues, the city that is home to the U.S. Olympic Committee is maintaining its low tax rates and living within its means. Colorado Spring’s experience just could have many Americans wondering why we rely on government for so much.
Now, I should fess up. I first heard of this story while watching the Ed Show hosted by far-left radio and TV political pundit Ed Schultz. I do occasionally like to amuse myself with the laughable commentary of the likes of Ed and his other MSNBC comrades Keith Olberman and Rachel Maddow.
Nevertheless, at issue in Colorado Springs was a desperate plea from city officials about 7 months ago to the voters asking for approval to raise taxes to pay for routine services. It was the same old story – the recession had caused a decline in tax revenues and the city faced a shortfall of around $24 million. Without an increase in the local sales tax, city services would have to be curtailed. With the result of the referendum, the people had spoken – city government, you will get no tax increase; do what you can with current revenue levels.
Unlike California, where for years the electorate demanded more from government without the obligation to pay for it, the good folks of Colorado Springs not only rejected higher taxes but took it upon themselves to remedy their own problem. Private citizens volunteered to pick up trash in parks. Swim clubs took over public pools. Churches and private organizations, like the U.S. Olympic committee, raised money to keep community centers and city fountains running. Admirably, one anonymous woman donated $37,000 to keep Nancy Lewis Park green and clean. Of course, Ed Schultz neglected to report these positive facets of the story, dwelling instead on how aghast he was that voters would vote down tax increases to fund non-essential government services like museums, parks, and pools. As a good statist it is inconceivable to him how normal people could live without being dependent on government for these needs.
And that should be the question raised by Colorado Springs’s experience – why do Americans rely so heavily on government even to the point of extreme bankruptcy for needs that could be taken care of by the private sector? Perhaps it’s because we have been so socialized by public schools, the so-called mainstream media, and the likes of Ed Schultz to believe that our greatness comes from government and not from within each one of us as citizens. That’s why Schultz deliberately ignored the volunteerism and charity of the folks in Colorado Springs that confronted the budget cuts head on. Or maybe Americans have gotten so use to the Federal Reserve monetizing debt at the federal level that we have become oblivious to the limits of state power.
After all, Uncle Sam has run up over $13 trillion in debt with the help of the printing presses at the Fed, and it is hard to see how that has negatively affected our lives. But it has. All one has to do is buy one of those novelty cards that lists what things cost in the year of your birth. As I looked at the cost of a slice of pizza ($.15) in the year of my birth, I became incredulous since I had just spent $2.50 for a slice on Saturday. Why has the cost of things increased so much over time? It is because of the inflationary policies of government and the Federal Reserve in particular.
Government does have limits as we are seeing in this most recent economic crisis. Even when times are good, government at all levels feel pressure to raise additional revenue to cover the increased costs of services produced by the Fed’s inflationary policies. To break this endless cycle, Americans must wean themselves off their dependence on government. If some services cannot function without government subsidies, then perhaps they should be done away with. For instance, because budget cuts have forced the buses to stop running at 6:15 p.m.in Colorado Springs indicates that the bus line is not self-sufficient after that time (for the sake of argument let’s assume it is self-sufficient before 6:15 p.m.). After the budget crisis ends, why should the city spend money on running buses at night? Wouldn’t that be a misallocation of scarce resources since demand for bus service at night is not at the level where the bus line can at least pay its bills? Would a restaurant knowingly stay open beyond a time that is profitable? – Of course not. I know that restaurants and public transit are not exactly the same animal, but they are alike in that they both must deal with scarce resources. Like the restaurant owner, city managers must make decisions with the least amount of waste possible or face financial hardship.
User fees could be used for services like parks, pools, and libraries. Whoever said these services should be “free” anyway? Like the gas tax is to roads, fees to use parks, pools, and sign out books is more just than forcing homeowners to subsidize the leisure activities of others.
By cutting services that do not make economic sense and imposing user fees on others, could local governments drastically reduce taxes? Would this provide for a better allocation of scarce resources to more urgent needs? How many fixed-budget seniors would avoid losing their homes because of ever-increasing taxes? How many young homeowners, just starting out, would be able to afford health care if they didn’t have to pay for fountains, parks, libraries, and other non-essential services? As we have seen in Colorado Springs, would local citizens fill the void left by government?
These are just a few of the questions that need to be explored. On the other side of this current economic crisis the American people are going to have to change and come up with more creative ways to operate. The system is broke and broken at all levels of government. Colorado Springs could offer a glimpse of what is to come. We should all stay tuned to this unfolding story for the good and the bad aspects of it. That’s assuming the mainstream media and the Ed Schultz’s of the world report it accurately.