House Budget: The Rich Win Again
Tom Sgouros, GoLocalProv MINDSETTER™
House Budget: The Rich Win Again
Last winter, our emergency housing shelters were full to the brim. But we'll cut pretty much all the housing aid that was in the budget. Poor people continue to struggle, but we'll increase their medical co-pays, pulling a little more spending money out of the state economy. Cities continue to struggle, but we'll just ignore them and hope for the better. Why should you care? Because the thing about the losers in these public policy debates is that they don't disappear. Just because you've cut their funding doesn't mean you can ignore the problem they represent. In many cases, the cuts are little more than good predictors of worse problems to come.
There wasn't much money left for affordable housing subsidies in the budget, but it's almost all history. And RIte Care (Medicaid) recipients will see their premiums increase. What will happen to the people who we were helping? They'll all see their budgets tighten, of course. For the economy, this will mean less money spent at neighborhood-scale businesses, and so a slower economy all around. For the people themselves, it will be worse. For some it will mean more frequent moves, pulling children from one school to another, disrupting their education and those of their peers. Some will abandon RIte Care and simply show up at hospital emergency rooms again, the very thing RIte Care was invented to prevent. And some will die trying to warm themselves on heating grates next winter, like Christopher Harrington of Pawtucket did last month.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTAnd then there is the continuing domestic abuse represented by the state's treatment of its cities and towns. The attitude of the Assembly leaders appears to be that the municipalities made their own problems and are therefore responsible for their own solution. This is an appalling misreading of the situation, and we'll all come to regret it.
Neglecting our cities
Cities first: It would be foolish to claim that corruption and incompetence have played no part in our cities' decline, but it is equally foolish to claim that corruption and incompetence are the most significant reason for it. Sixty years ago, our cities were the source of our wealth, the busiest and most prosperous parts of our state. What has happened since then wasn't an upsurge in corruption, it was the advent of highways, the widespread ownership of cars, the creation of modern suburbs. These were devastating to our cities, but by blaming the decline on corrupt mayors, we have managed to evade the responsibility we all share for these effects.
Drive around Elmwood, in Providence, and you'll see dozens of mansions that now have half a dozen doorbells on them. Was it corruption and managerial incompetence that reduced these properties' value so much? Or was it the state's creation of new roads to the countryside, the subsidies for new schools out there, the imposition of zoning laws that favored new construction, and the utter indifference to the effect on urban budgets these subsidies had? The result of all this was a 50-year gold rush for those who transformed farms into houses, only now (possibly) coming to an end.
The problem is that starving cities of dollars does not make their problems go away, and their problems are our problems. Look at Central Falls. Through an accident of geography and timing, it's a city with only poor neighborhoods. Without help, they will no longer be able to pay any bills at all sometime this fall. A default at that point will raise borrowing costs dramatically, for all the towns in the state, as well as the state itself. Since no one seems to care that our governments are now utterly dependent on the bond market, this will be big trouble for everyone, and could add tens of millions of dollars to already-stressed municipal budgets.
And our towns too
Which brings us around to those other municipal budgets, out in the suburbs. The gold rush allowed them to benefit at the cities' expense for a long time, but it was never going to last. Between the state of the economy and the shrinking availability of developable land, no one is seeing the 4 percent growth that used to be a way of life in many suburbs. Unfortunately, many of those towns have budgets that depended on that growth, and without it, they are forced to shrink and skimp and cut—just like the cities. And so no music teacher or AP class in the state is safe, no library can count on continuing support, and the increasing stresses on our water systems are simply someone else's problem. But blaming it on the unions is easier than accepting responsibility, isn't it?
Have no fear, all is not bleak, and there are some bright spots in the budget. If you run a corporation that uses sophisticated "tax-avoidance" strategies to move taxable income to other states, the Assembly budget won't close any of those loopholes this year. If you're rich enough to have benefited from the tax cuts of the last ten years, you can keep them. We're in a crisis, but we made it ourselves, and we can get out ourselves. But only if we're honest about the problems, and the sacrifices necessary to solve them. But instead we use the call for shared sacrifice to take more from those who have less and give it to those who have more. It's a funny definition of "sharing."
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Tom Sgouros is the editor of The Rhode Island Policy Reporter and author of Ten Things You Don’t Know About Rhode Island. Reach him at [email protected].