Ignoring Human Nature Once Again

Tom Sgouros’s message must be mellifluous to public-sector ears. Everything’s cause and effect (no poor decisions on officials’ part), and vaguely unseemly of the citizens who initiated the latter.
The story, in summary, is that all was demographically golden in the world back in the ’50s, until people started moving from Rhode Island’s cities to join the “rubes” in the “sticks.” Property values decreased in the cities, while it increased in the suburbs, and the latter expanded to accommodate the “demands” of citizens for city-quality public services. Urban governments are unfairly maligned for their deficit budgets, and suburban governments are unduly proud of their surpluses (or, presumably, were until recently). The next application of pain, however, will come as “high gasoline prices” send folks back to the city, and the trend will reverse.
What makes the piece worth some pondering, though, is the hint of Sgouros’s solution to all this unfairness:

In the meantime, let’s come up with a tax system that doesn’t penalize us when people move.

That Sgouros leaves this dangling is suggestive of an invitation to speculate, but it would be a mistake to slide past a key question: Why shouldn’t municipalities be “penalized” — so to speak — for the exodus of their residents? Isn’t the discomfort a valuable impetus for change in a better direction? Take, for example, some facts that Sgouros cites from Providence:

Providence has only two-thirds the number of people it had in 1950, and a much smaller fraction of the property value, but it has the same number of blocks to police, about the same number of houses to burn, and more students in its schools.

In other words, Providence has been attracting poorer people who have more children. To the extent that its finances are insulated from its actual population, the city has less motivation to change the character of its citizenry. Or approach the matter from the other side:

The other big problem comes when suburban residents start demanding (and/or needing) the same level of services as the cities provide. When people move to the sticks and then demand fire response times comparable to what they’d have in Providence, you have a recipe for very high costs. When crime rates creeping upward make suburban residents demand policing like they’d get in Pawtucket, that’s a problem.

If a suburb faces no consequences for too-rapid expansion, then it has less incentive to preserve its character or to ensure that those moving within its borders can afford to do so. Conversely, if it faces no penalty for driving citizens (or businesses) away, it can indulge in stagnationary policies that lock development and particular classes of people out. The non-penalizing tax system will ensure that the roads stay well kept and well patrolled whether there are fifty or five households per square mile.
Lurking behind these assessments is the dark political reality of human nature: If the leaders of a city, town, or region do not have to consider demographics’ effects on their budgets, then they will be inclined to institute policies that attract residents who most benefit them — which is to say people who will justify requesting more dollars from whomever it is that doles them out and who will vote for candidates who promise to go after those dollars. As the taxing and policing body of government becomes more centralized, and the Gimme Vote more unified within particular districts, the dynamic will become such that those who receive will vote themselves an arm with which to reach into the pockets of those who provide.
Once that game is proven to be the order of things, those on the losing end of the tax-and-spend formula will find a way to extricate themselves.

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Tom W
Tom W
13 years ago

What a crock! Seeking a rationalization to excuse rapacious taxes, Mr. Sgouros finds seeks shelter in the “anti-sprawl” movement. Let us not forget that 70-80% of local budgets go to the school systems, and 70-80% of that goes into NEA / AFT wages and benefits. High taxes are not driven by roads, bridges and other suburban infrastructure, but by insatiable public sector unions – which first began to have their way with Rhode Island taxpayers circa 1966. Before that RI’s public sector was union-free, and could be again if the General Assembly would only repeal the statute giving permission to the unions. Does Mr. Sgouros expect us to believe that somehow those “suburban” costs would come down if people moved back into Providence, where per pupil expenditures dwarf those in the suburban communities? And since all Rhode Island teachers are in the state pension system, with its $5 billion dollar shortfall, suburbanites moving back to the urban areas would have zero impact on this financial catastrophe awaiting us. Mr. Sgouros also dances around the fact that the suburban property tax payers are subsidizing the “urban centers” of Woonsocket, Central Falls and Providence via the General Assembly’s grossly disproportionate transfer of general fund derived “school aid” to those municipalities. In other words, the suburban taxpayers are essentially paying property (and income taxes) to pay for multiple school systems at once – their own community’s and that of the “urban cores.” Ironically he notes that while Providence’s population has declined, its school population is burgeoning. Well DUH! Perhaps Mr. Sgouros has heard about the “War on Poverty” that began over 40 years ago. In Rhode Island, that has morphed into what is probably Rhode Island’s single largest industry (measured in dollars, if not also “workforce”) – the welfare industry – comprised of… Read more »

Mario
Mario
13 years ago

This reminds me of something I have seen elsewhere, where dying cities in Europe are choosing to demolish large sections of property in order to maintain the desired levels of density. I’m not sure that it would be the right idea for here, but it certainly solves the “fewer people, same blocks” problem.
Here it is (page 9):

“The plan, therefore, calls for demolishing underused sections of the city and weaving the nature on the periphery into the center: to create “urban islands set in a landscaped zone,” as Sonja Beeck, a Bauhaus planner, told me. “That will make the remaining urban areas denser and more alive.” The city has lost 25 percent of its population in recent years. “That means it is 25 percent too big,” Gröger said.”

When you think about it, there really isn’t any reason why cities should be locked into the same infrastructure they had at their peak population level.

Frank
Frank
13 years ago

That an opinion piece this flawed makes it into the Journal is proof that their standards are painfully low. This sort of liberal nonsense ought to be laughed right out of the copy room.
Sgouros would like us to believe that property taxes are driven by municipal costs. As Tom W notes, nothing could be further from the truth. And this is so fundamental that one has to wonder whether the author is competely ignorant of what he is writing about or whether he is intentionally trying to mislead people.
Ignoring education costs for the moment the author doesn’t seem to realize that the less dense the population the lower the probability that you have town water and sewer services, which he seems to be claiming is THE reason for high property taxes. So what he cliams to be an extremely high cost in rural areas becomes no cost at all.
If it were true that the urbans were “high cost” why would the poor/immigrant population be moving to them and not the suburbs? Home costs and taxes are higher in the suburban /rural communities.
This article claims RIs taxes are as high as they are because people here are much too spread out, that we should never have left the cities. Using this insane thought process and the author’s spurious grasp of reality, I wonder if he might also agree that since RI has the 2nd highest population density per square mile (2nd only to New Jersey and nearly 12 times the national average) that is why we have some of the lowest costs/taxes in the country with people and businesses standing in line on our borders praying that they can move into RI ASAP?

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