First, Do a Good Job

In his most recent column Washington Post foreign policy columnist Fareed Zakaria turns to domestic policy and, perhaps not coincidentally, makes a point I have made for years. The surest way for Democrats to prove the superiority of their plans to what Republicans are doing is for them to govern well in the places they already hold the reins of government:

It’s hard to see how the government shutdown and reopening is anything other than a defeat for the Democrats — a high-stakes confrontation that ended with their own goals unmet and their message muddled. If they didn’t have the leverage or were not willing to use it to prolong the shutdown, then why did they stage it at all?

The shutdown reinforced the image of the Democrats as feckless. They promise wonderful-sounding new programs — free child care, for example — but in fact preside over bloated bureaucracies and inept execution. If America has an affordability crisis, it tends to be in places Democrats govern, like New York, Illinois and California, which all feature high taxes, soaring housing costs and stagnant outcomes in basic areas like education and infrastructure.

concluding:

The truth is that local government in the U.S. is already living on borrowed time. For decades, states and cities have traded short-term political harmony for long-term fiscal ruin. To keep the peace with powerful public sector unions, they promise ever-more-lavish pensions and benefits, then quietly defer the bill to future taxpayers. Across America, these obligations act like slow-motion fiscal time bombs — invisible for now, but guaranteed to explode.

These problems have been brewing for decades. Our savings rate has been too low for 70 years. Our spending has been too high for most of that period. Business investment has been too low for the last 25 years. We don’t produce enough of what we consume (for a good rundown on this see the San Francisco Federal Reserve).

The most likely strategy for dealing with debt at the federal level will be to monetize it—that’s what we’ve done for the last 25 years at least. That is diametrically opposed to the buzzword of the day: “affordability”.

Unless the federal government bails out local governments (something I oppose) that alternative is not open to state and local governments. What is to be done? I have been seeking answers to that question from Democrats for some time to no avail.

Nobody wants higher taxes. That is particularly true of Republicans. Every Republican president of recent memory has cut taxes. Everybody wants to spend more; they may differ on how they want to spend the money but everybody wants to spend more.

As I write this post the Chicago City Council is debating the mayor’s latest budget proposal. The mayor wants to balance the budget via higher taxes on businesses. The City Council realizes that is unlikely to attract businesses to Chicago. Chicago has its lowest population in a century and large businesses have been leaving not only the city but the state.

The state is raising the sales tax Chicagoans will pay. Chicago already has the highest sales tax of any major city and the highest property taxes of any major city. Illinoisans have refused to allow the state to create a graduated state income tax. We recognize that although the tax may be levied on those making the highest income at first in due course everyone with a job will be paying higher state income taxes. Neither the city nor the state appear to be capable of economization.

It’s not the Republicans’ fault. There are no Republicans on the Chicago City Council and the State of Illinois has supermajorities in both houses of the legislature. That has been true for decades.