01 Jan 2013 All Politics Should Be Local, by Hughey Newsome
It is ironic that the city Barack Obama used to demonstrate his capabilities as a leader is now nearly out of cash.
During the 2012 campaign, the President and his liberal supporters touted the auto bailout as having saved Detroit. The carmakers may still be alive, but the Motor City itself is in big trouble!
According to a December 3 Wall Street Journal commentary, for example, the city is near bankruptcy. To make matters worse, lifelines from the state tied to requirements to correct Detroit’s fiscal problems are opposed by its city council.
As of April, Detroit’s expected annual budget shortfall was at $265 million. A big chunk of that shortfall can be found in the city’s retirement liabilities — roughly $11 billion. The city will spend around $160 million this fiscal year on retiree benefits despite a general fund that was only $1.2 billion in April of 2012.
Detroit’s political problem is that the rubber meets the road at the local level.
Unlike the federal government, cities and states are directly beholden to their citizens. Local officials are responsible for things such as educating children, providing sanitation and first-response emergency services.
At the national level, politicians can make grandiose promises while their constituent services workload is light in comparison to their local counterparts.
This difference is a reason why limiting federal government and empowering local government was important to our Founding Fathers. Local leaders, under these circumstances, cannot easily escape the consequences of poor decisions.
In the case of Detroit, the city is hampered by decisions to cater to powerful unions demanding favorable retirement plans such as the ability to draw benefits when workers reached their 40s. There is no escape for the local politician because a city cannot escape such bad decisions by passing the buck.
Contrast this peril with the federal government liabilities. Of course, members of Congress and the President do face the electorate, but they are less likely to be blamed for local problems — even if mandates they created caused them.
Consider what happened to Rahm Emanuel, Obama’s first chief of staff. He was part of the administration that supported unions — particularly the NEA and AFT teachers unions — and took in hundreds of million in contributions from unions in the 2008 campaign.
When Emanuel later became mayor of Chicago, however, he ended up in a labor dispute with Chicago public school teachers over their lavish pay and benefits demands that led to a 2012 strike.
Chief of Staff Emanuel didn’t worry about such local mandates or needs, and likely made political claims and decisions with little thought of the ramification. As mayor, Emanuel had to deliver. That’s when he became what some call a union-buster – when he became responsible for educating the children and did not have the same latitude to play politics.
When the federal government infringes upon the daily responsibilities of those local or state entities, problems often arise.
This is one of the many problems with Obamacare. The original statute required states to expand Medicaid programs to cover individuals up to 138 percent of the poverty level or risk losing Medicaid funding. Even with some additional federal funding, this requirement would have heavily-burdened already financially-strapped states.
Apparently, it was the non-local politicians who did not fully discuss whether individual states could meet the expanded Medicaid mandate. Fortunately, the U.S. Supreme Court ruled the states cannot be forced to follow suit. But consider how such an edict from Washington — a town that cannot balance a budget (the federal government spent 144 percent of tax revenue in 2012) — would affect states that cannot print money and monetize their debts.
Perhaps, in the case of Obamacare, things would have been written differently if its authors would have to find all the money to pay for the massive program — like their state and local counterparts have to do.
This is why all politics should be local.
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Published by the National Center for Public Policy Research. Reprints permitted provided source is credited. New Visions Commentaries reflect the views of their author, and not necessarily those of Project 21, other Project 21 members, or the National Center for Public Policy Research, its board or staff.