Re: Time for Cities and Towns to Tighten Their Belts
I want to second Marc’s concluding thought in his prior post.
The Rhode Island budget deficit elephant is sitting in the middle of the room and people are still trying to ignore – or, at least, downplay – its very presence.
How long has this elephant been present without any real acknowledgement? A long time indeed.
As is typical in most crises, denial of the problem is the first place where many people get stuck. That is the problem here in RI right now.
NOBODY in this state has stepped up and truly challenged the failing status quo. The Governor only talks about cutting 1,000 jobs and other minor tweaks. House Finance Committee Chair Constantino only talks about no increase in any local aid. Meanwhile, others like the NEA continue to demand contract terms which blow spending past the tax cap lid.
All of that means the boldest moves so far amount to rearranging the deck chairs on the Titanic. While most people continue to party on as if nothing is amiss.
A deficit of roughly $450 million means there are structural problems to the state government’s economics. Structural problems don’t get solved by making only incremental changes on the margin.
It will take a previously unseen level of courage and bold action for someone to alter the political debate so we all finally face the elephant and deal with the structural issues. The issues won’t go away and delaying the day of reckoning will only make things worse in the end. Whether we want to talk about it or not, a lot of economic pain will be incurred before this debacle is resolved.
If I was either the Governor or a State House leader, here is what I would do:
- Gather a small group of key players in the state, reaching across party lines. Tell them I was going to be a visible state champion for an emergency effort to address the structural problems.
- Invite others to join me in becoming fellow champions for change, while also telling them that the effort would proceed regardless of their involvement or opposition.
- Inform them that the political paralysis of past times requires outside help in evaluating the financial dynamics.
- Remind them that there can be no sacred cows, no untouchable programs.
- Publicly tell the cities and towns to budget for next year as if there was a 5% across-the-board decrease in state aid so they have enough time to go back and re-open negotiations over existing contract terms.
- Give the evaluation process a limited amount of time to complete its work, say 60-90 days. People who are participating in that evaluation process need to be clear that a crisis situation means there is no time to waste, that things have to happen at a pace previously unheard of in government.
- And then, since entrenched behaviors only change with the proper incentives, inform everyone that we will move to put the state of Rhode Island into receivership if the recommendations are not acted on legislatively within 60 days thereafter.
People can argue over the particulars but focusing on those details won’t fix the massive problems faced by the state. Nor will debating the viability of public sector legal options. Arguing over those matters is a distraction from facing the fundamental problem: The state of RI has an untenable economic structure which, so far, nobody has shown the will to address head-on and fix.
With a wealth of experience in crisis management turnarounds in the private sector dating back nearly 30 years, I can assure you that nobody so far in RI is dealing with this crisis in a manner which bodes well for the future of the state and its many hard-working citizens. Acknowledging the presence and large size of the elephant in the room is the first place to start. Only then can we find the collective will to begin solving the very real problems.