Category Archives: Local Government

Disturbing Questions

We woke this morning to news reports that five teenagers had been shot while walking along Indianapolis’ downtown canal. The shots evidently came from the parking lot of the Historical Society–where a wedding was taking place at the time.

As I write this, little is known except that two of the teens are in critical condition and no one is currently in custody.

It may be that this was one of those random acts that no city, no matter how safe or well-run, can prevent. We deceive ourselves if we believe that police can guard against every sudden eruption of violence. But this shooting, in the heart of our city and next to the canal that so many of us routinely walk or bike, raises sobering questions.

First, what is the relationship–if any–between the recent “discovery” of fiscal shortfalls in public safety and what some people living along the canal claim was a diminished police presence? (The fiscal situation itself raises very troubling questions about the honesty of the Administration’s budgeting process during an election year.)

Second, if there were fewer police in the area, was that due to deliberate decisions about deployment, and if so, what were those decisions and why were they made? One story suggested that a number of officers were called to a brawl at the fire station at West and Ohio; do we have so few police that an incident in one place necessarily leaves other areas unprotected?

We don’t know the answers to these questions, and asking them is not meant to assume the answers. But the questions need to be asked, because this event will have repercussions far beyond the personal tragedy it represents.

Civic and political leaders have been nurturing the rebirth of downtown since the 1970s. The canal is one of the “jewels” of that effort–a jewel that has been sadly neglected the past few years, as I have previously noted. It is an important amenity in a city without oceans or mountains. Developers have been enticed to make significant investments along its banks; museums and public buildings adjoin it. Maintaining it and keeping it safe for the residents and tourists who enjoy it is an important responsibility and should be a high priority of the current Administration.

When the media is filled with stories of shootings, when on-camera interviews feature onlookers declaring they no longer feel safe in the area, the result is to undercut years of painstaking effort, and to reinforce inaccurate stereotypes about the “dangers” of downtown.

Perhaps this was one of those random events that even the best policing couldn’t have averted. Perhaps it was the result of public safety mis-management.

Or perhaps we are seeing the inevitable results of the anti-tax zealotry that added tax caps to the Indiana Constitution–tax caps that are starving local governments and decimating public services.

Whatever the answer, we need to find and fix it.

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There’s No “We” in Mitch Land…

When Steve Goldsmith was Mayor–talking incessantly about government’s “customers” while shifting costs from the operating to the capital budget in order to “reduce” taxes (i.e., push the costs to the next administration)–I used to grouse that his vision of the ideal government would be one that eliminated all municipal services so that the City-County Building could be rented out to give taxpayers a rebate of 50 cents each.

I’ve often considered Mitch Daniels to be a Goldsmith clone. They share a touching belief that privatization cures cancer–a belief that appears unshakable no matter how many times they’ve been bitten by poorly-thought-out contracts. (They also share a patronizing attitude that lets you know they think they know more than anyone else–and most definitely more than those annoying yahoos elected to legislative bodies.) I’m not the only person who has noticed the resemblance: the joke that made the rounds when Mitch was first elected was that he was Steve Goldsmith with a personality.

Now Mitch has confirmed my snarky “rent out the City-County Building” description of their shared governing philosophy.

According to the Governor, Indiana has suddenly “discovered” 320 million dollars that we somehow didn’t know we had. Assuming the accuracy of his description–i.e., assuming the administration really didn’t know the money was there–most of us would first question the competence of the administration employees involved. After all, how do you “lose” 320 million dollars? Then–in a sane universe–we might begin a discussion to see which of the recent, draconian cuts to public services we might mitigate. Our bridges are crumbling, our parks are untended, our schools struggling, early childhood education still largely unfunded. Foster parents have just taken a big hit, and the administration has continued its unremitting war on Medicaid recipients. Granted, 320 million won’t restore all that–or even come close–but it would help.

But that’s not the way officials think in “Mitch land.”

Mitch doesn’t want to apply that money to improve the state’s infrastructure, or to ameliorate the suffering caused by cuts to social services during an economic downturn. He wants to trigger an automatic “rebate”–to return it to individual taxpayers. Rather than applying the windfall to improve public services or the public goods we all share, he wants to give each taxpayer a refund. Elementary math suggests that refund might be enough to buy a couple of coffees at Starbucks–it certainly won’t be enough to repair that tire you ruptured on one of our neglected roads, or to pay the tutor you hired to supplement your child’s inadequate math instruction.

In Mitch land, government can do no good and the private sector can do no wrong. Applying “found” money (forgive the quotes and my skepticism) to education or infrastructure is “waste”–but sprinkling it among hundreds of thousands of taxpayers is “good government.”

Maybe Mitch can rent out the statehouse, and send each of us enough to buy an hour or two of privatized parking.

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The Devil You Know….

A couple of political truisms–which I have always accepted as “givens”–went up in smoke last night. The first was that at-large candidates win or lose based upon the performance of their party’s mayoral candidate. The second was that in close races, victory is largely a matter of getting your vote out.

In Indianapolis yesterday, the Democrats got their votes out. They took back the Council, including the at-large seats. But enough of those Democrats scratched Melina Kennedy to allow Ballard a second term.

There will undoubtedly be lots of second-guessing and post-election analysis. Here’s my two-cents-worth:  the sorts of things about the Ballard Administration that appall so many of us who watch government closely are not the sorts of things that are apparent to the average voter (and the media largely ignored those issues during his term). No one was enthusiastic about him–he never got out of the low 40s in internal polls–but the average voter was aware of no strong reason to oppose him. Meanwhile, Melina Kennedy never gave people a strong reason to vote for her–her ads did not adequately introduce her to the voters before they began attacking Ballard, and the attack ads were, as Paul Ogden has noted, insufficiently specific; they failed to explain what was wrong with the cozy deals they alluded to–they simply attacked.

Given two candidates seen as interchangeable, voters opted for the one with whom they were familiar.

The good news is that a Democratic Council should be able to block the sorts of cozy deals and poor policy choices that have characterized Ballard’s tenure. The danger is that the Council will simply act out of partisanship, rather than principle. In either case, the next four years are likely to be contentious.

A mediocre (at best) mayor and a hostile council aren’t exactly a recipe for progress.

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Did Not! Did So!

Ah, budget battles.

This morning’s Star detailed the back and forth political arguments about whether the Ballard Administration actually made the budget cuts the mayor promised during his campaign. Their independent analysis amounted to: who knows? That’s not a criticism of the reporters–it’s a reflection of the games public managers play.

This actually began back during the Goldsmith Administration. In fact, it could argued that the City’s dicey finances actually began there; I know Ballard blamed Peterson because he inherited significant budget problems, but Peterson himself inherited a true “smoke and mirrors” budget from Goldsmith. (That doesn’t mean he shouldn’t have done more to fix it.)

Goldsmith’s clever game was to change the way in which the budget was reported from the relatively straightforward system employed during the Hudnut Administration. When you change budget categories, it becomes virtually impossible to compare apples to apples. (He also touted savings from his own exaggerated “estimated growth” figures–as in “we project that expenditures would have reached X if we hadn’t done Y. What good managers we are!)

In this case, Ballard’s folks excluded federal and other grants and some debt service from the budget calculation, and “voila”–they saved money.

I know I’m talking crazy, but what if we focused less on the relative amounts we spend, and more on what we get for our money? What if we focused less on the tax levy (the total amount raised) and more on how fairly we assess property and set rates? What if we rewarded good management rather than providing incentives to cut corners and push higher maintenance costs to the next guy?

What a dreamer I am…..

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Politics and Policy: A Cautionary Tale

I’m sharing my next column for the IBJ, which expands upon my earlier post, and considers the policy issues that the Litebox blunder illuminate.

How did we get from “Enterprise Zones” to Litebox?

Back in my Hudnut Administration days, I remember enthusiastic discussions about Enterprise Zones–a new tool promoted by then-Congressman Jack Kemp to encourage investment in depressed areas of the city. The idea was to offer tax incentives to businesses who were willing to locate in such areas and hire the unemployed who lived there.

It was a great—if reality-challenged—idea.

It didn’t take long for Carmel and other affluent bedroom communities to begin competing for those employers by offering incentives of their own. I don’t know whether those original Enterprise Zones still exist, but I do know that state and local governments are all falling over themselves to lure companies with ever-more-lavish inducements, courtesy of their taxpayers.

Which brings us to Litebox.

Amid great hoopla, Mayor Ballard and Governor Daniels announced the award of major incentives to Litebox, a company promising to create 1200 new jobs. Its sole proprietor was man who not only turned out to have no history of entrepreneurial or business success, but who also has multiple unpaid tax liens and judgments against him in several states.

The story makes vividly clear how slapdash the City’s vetting process has been, and how politically motivated the decision to announce this “job creation” success was. (Really, in the age of Google, this level of incompetence is incomprehensible.) But the story makes a bigger point, albeit implicitly, about the entire policy of cities “buying” jobs by offering financial incentives to companies that promise to move and/or expand.

The obvious arguments against such efforts are familiar: it puts government in the position of helping some businesses but not others, which troubles those of us who believe in real markets; and it is a zero-sum game overall, since the company that moves from Ohio to Indiana is not creating more jobs–it is simply moving them from one place to another.

But the Litebox fiasco points up another problem with these programs. Even if competent people are running them, they are unlikely to know enough about the technologies and economic realities of very different industries to make truly informed decisions. The same technological and cultural changes that increasingly challenge tech businesses and that make investment decisions risky even for savvy and highly knowledgeable experts, make it virtually impossible for government officials to accurately gauge the viability of tech business deals. (In this case, reporters quoted industry sources who pointed to “ridiculous” assumptions in the Litebox business plan, but in most cases, the miscalculations are more difficult to spot.)

As a recent Indianapolis Star article reported, citing several examples, even companies with sound performance histories and none of the obvious red flags that were ignored in the Litebox example routinely fail to deliver the jobs that are promised.

When you add in the inevitable politics involved–the temptations of cronyism, the huge pressures to score political points, to look like you are delivering on your campaign promises–it’s no wonder that the jobs frequently don’t materialize.

It’s long past time to re-examine these programs and the policy assumptions they’re built on. It was probably inevitable that the use of tax and other incentives would not be limited to truly depressed areas; I was among those who failed to appreciate that inevitability.

Here’s a truly radical suggestion: what if we took the tax dollars that are currently being siphoned off to these favored businesses and used them to create a city that people want to live in? What if we decided to compete not with handouts, but with a superior quality of life?

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