Monthly Archives: April 2009

"…I saw a city invincible…"

Walt Whitman, 1855

Walt Whitman, 1855

In a stanza of  Leaves of Grass (1867) Walt Whitman reveals Camden, New Jersey:  a city of human vitality, energy, and emergence.

In this “New City of Friends,” (a reference to Camden’s Quaker roots and proximity to Philadelphia),

“…nothing was greater there than the quality of robust love – it led the rest;

It was seen every hour in the actions of the men of that city, And in all their looks and words.”

Camden’s  geographic endowment was fortunate. Additionally, according to Alan Karcher in New Jersey’s Multiple Municipal Madness, when  incorporated in 1844, Camden was one of  five communities with legislative permission to host a bank.  Its roads terminated at vital ports with ferries to Philadelphia and Trenton. And “most important” was its “energetic merchant and manufacturing middle class that possessed an entrepreneurial spirit.”

Camden boomed from 1840 to 1900 , so much so, the Chamber of Commerce briefly ceased operation.  After World War One, Camden home to RCA Victor, and Campbell’s Soup Company, was overflowing. The city sought more space and  “The Greater Camden Movement” began.

Camden hired “nationally recognized planners” and a PR firm. The planners’ advice:  build a new bridge.  In 1922, the Benjamin Franklin bridge opened.  While  successful, the bridge may have also helped shift the population. The plan didn’t deliver its promises.

Karcher cites, “a misconception on the impact of infrastructure improvements, and an almost religious faith that infrastructure could create community instead of the other way around.”

Karcher continues,

“The dynamic that created the plan was the same dynamic that created the gargantuan public housing projects in the unshakable belief that the brick and mortar would somehow forge a community….Communities grow organically; there can be no specific mold or model. It is a phenomenon that must grow from the bottom up, and resists any efforts to have it imposed from the top down. What we see in Camden, with its overreliance on the beneficent effects of infrastructure improvements, is the law of unanticipated consequences operating to the fullest.”

Walt Whitman did not write these lines in praise of the central plan.  One of his many muses in his evocation of 19th century America was the electric energy of a city’s people in action – the  spontaneous order he observed as Camden’s  urban contours emerged.

(Indeed, Whitman’s greatness as a poet is his vivid celebration of motion and human energy, which makes his end-of-life reflection on what drove his words all the more fascinating, “spontaneity, spontaneity.”)

It is unintentionally ironic that Camden named the Walt Whitman bridge in his honor, when it opened to traffic in 1956. By that time, Camden, a city that originated with a license granted to operate a ferry in 1688,  was on its decline, for numerous reasons.

Today Camden is home to the most  intractable urban problems in the state: poverty, poor schools, high crime, and little commerce. It is a city tangled in many government plans:  a main beneficiary of the New Jersey Supreme Court’s educational rulings,  the state’s municipal aid transfers, and the city government’s new, and cautiously advertised, Master Plan . Last week Camden reapplied for federal stimulus funds for a water expansion project that was not selected as “shovel-ready.”   Camden’s problems are real, but its potential is stifled as long as it remains an open-ended experiment in government planning.

The Enduring Relevance of Federalism

Last week in The New York Times, Tom Brokaw wrote an op-ed questioning the enduring validity of the system of federalism that has been in place for over 200 years. He writes, “Every state and every region in the country is stuck with some form of anachronistic and expensive local government structure that dates to horse-drawn wagons, family farms, and small-town convenience.” Is this an accurate depiction, or is it the case that in many instances of failed local government, overly burdensome state and federal governments are preventing the enactment of localized solutions?

Two Brookings Institution scholars, Bruce Katz and Jennifer Bradley, responded to Brokaw with a letter to the editor, supporting his claim that in order for the federal-state-local relationship to remain functional, all three levels of government need to have the flexibility to adapt to changing demographics and technologies. Katz and Bradley point out that, where once most people lived and worked in small towns, today the workforce is heavily concentrated in metropolitan areas.  (Katz, Bradley, and others at Brookings have previously written about this issue.)

In their letter, however, Katz and Bradley point out that in some cities federalism is functioning well where proximate municipalities are working together to address the common needs of their residents.  They cite Denver, Louisville, and Portland as cities that have successfully “developed transportation and land-use strategies that reflect the true metropolitan scope of economic and social life.” The cooperation of authorities throughout these metropolitan regions demonstrates that some issues relating to city life are common across the areas surrounding cities, and attempting to handle these issues locally would lead to poorly integrated solutions.

While transit issues are an obvious area in which in makes sense for townships within a metropolis to collaborate, current work of the Neighborhood Development Department in Boston shows us that city governance can implement successful programs that function at the most localized level. The NDD is taking innovative, localized action against the current mortgage foreclosure crisis. Although the foreclosure rate in the city has risen dramatically over the past years, it is doing much better than other cities of comparable size, according to American Public Media’s Marketplace.

Why is this? The city has found that the appropriate level to deal with this challenge is the block level, offering assistance on a case-by-case basis because foreclosures affect each block differently. Mayor Thomas Menino developed a Foreclosure Intervention Team to provide mortgage counseling to potential home buyers and assistance available to homeowners in danger of foreclosure.  In places where rates remain high despite these efforts, the city is providing special services such as increased police presence to monitor vacant buildings and street improvements to make these areas attractive to new buyers or tenants.

Boston’s Neighborhood Development Department demonstrates the beauty of federalism in a world that is constantly changing.  All policy issues are different and need to be dealt with accordingly; although our basic system of governance has not changed since the nation’s founding, it does remain adaptable to the needs of the day, contrary to Brokaw’s assertion.  To make the best possible use of taxpayers’ resources, state governments should allow their municipalities the freedom to take advantage of economies of scale where they exist and to allow for creative, location-specific solutions where top-down management would be stifling.

Czars, Auditors, Data Trails and Statistics

The Government Accountability Office issued a report last week stressing the need for accountability on the state and local level for how federal stimulus dollars are used. Ninety percent of $49 billion headed to the states will be spent in three areas: Medicaid, transportation and education. The sixteen states surveyed are handling oversight differently. Some are appointing, ‘recovery czars’, others like Mississippi are delegating oversight of education and transportation to the independent authorities that manage these activities for the state.

One of the primary concerns expressed by states  is the difficulty of tracking spending. GAO reports states are “uncertain about their reporting responsibilities when Recovery Act money goes directly to the localities.”  Such uncertainty is not limited to which transactions to follow, but also, how to calculate economic impacts including indirect job creation and the impact of funding not intended to create jobs.

A few things to consider. Why is following federal spending on the state and local levels so difficult? States and localities have been receiving federal funds for decades – why haven’t better tracking systems emerged?  And secondly, it is likely estimating the economic impact of stimulus dollars will be fraught with difficulty, with much potential for miscalculation and error.

Accountability officers and auditors have their work ahead of them.

A brewing awareness

People don’t generally think about the governmental framework in which they live. It’s assumed like oxygen.  But change that framework drastically enough, and things learned and forgotten from history textbooks develop a live pulse.

Federalism, as a point of common discussion, is relegated to Constitutional Law, economics and political science journals. It’s the stuff policy people and academics pour over.  But not lately, as Randal Barnett writes at the Wall Street Journal, tea parties and sovereignty amendments speak to a growing awareness of profound structural change in the relationship between the federal government and the states.  The ceding of local and state control to the federal level is not a new story. The debate over this changing relationship dates to the 19th century, but given the size and kinds of spending in the last several years, rounded out by the stimulus and budget of recent weeks, and a threshold is perceived.

For three different policy takes: an interesting solution offered by Greg Mankiw back in October, would have given the governors more discretion in accepting funds – they could elect to pass it on to citizens, rather than expand programs. The Brookings Institute suggests following Germany, a federalist system, in applying transportation funds. Chris Edwards of CATO has done work on how federal aid erodes state budget autonomy.

Grim, Bleak and Dire: State budget deficits persist

The National Conference of Legislatures has a new report on the fiscal health of the states. It’s a grim picture.  Budget gaps that started appearing in 2008 are likely to continue into 2011. While enacting FY 2009 budgets, 44 states filled a total $40 billion gap. But within a few months, budgetary gaps reopened, this one topping a $62.4 billion.

The main cause is the drying up of revenue streams.  And each state has its own vulnerabilities: New Jersey and New York are tied to Wall Street, Hawaii is linked to the tourism industry. Given the depth of the recession, and these types of structural dependencies, it’s proving very hard for states to maneuver out of the crisis.

This gets back to the fiscal choices and assumptions of governments. We’ve heard about “aggressive accounting” – creative, and suspect accounting practices.   Now we may be seeing the results  of “aggressive budgeting,” –  the tendency to expand spending on the assumption that revenues only go up.

The next chapter for the states,  an estimated budget gap totaling $121.2 billion in 2010,  says Corina Eckl of NCSL, “The fiscal situation facing the states is like a bad horror movie. The details get more grusome and they never seen to end.”

Tracking the federal dollar through a federalist system

Recovery.gov is the Obama Administration’s effort to provide reporting details on how federal stimulus dollars are being used.

Not only is this a big task,  given the nature of bureaucracy and information, it’s an impossibility.  Unsurprisingly, a private sector company has taken the lead with Recovery.org.

As Government Executive reports

“The goals and intent [of the administration] are absolutely right,” Balsam said. “But, they’ve got no experience and no reach into local communities and states. There’s no basis for them to go figure out where everything is, because there is no reporting relationship in place. It’s an intractable problem for the administration.”

Onvia is a company that tracks procurement spending. They  saw the stimulus as an opportunity, if not an obligation, to follow the unprecedented infusion of federal dollars. The geographic detail is impressive.

I was surprised to find my (unincorporated)  hometown.  I expected to have my search end at the municipal level.

This stimulus bill may be a kind of ‘tipping point’ for transparency. What the goverment cannot provide quickly or meaningfully, it can also no longer hide  as easily.