Putting the Money Where It’s Needed Most

Once again the city that has been most subject to terrorist attack is complaining that it’s not getting a large enough share of anti-terrorism dollars from the federal government:

NEW YORK, NY July 08, 2007 —Members of the state’s Congressional delegation say New York City has been shortchanged once again in the distribution of federal anti-terrorism funding.

Senator Charles Schumer says the government persists in giving money to places that need less money than New York. Schumer joined Congressman Peter King, the ranking Republican on the House Homeland Security Committee, in blasting this year’s allocation of funds from an urban security grant program.

The lawmakers say the city was supposed to receive about $134 million this year, an increase of about 8 percent over last year. But they say that’s still $73 million less than the city received two years ago. Last year, New York politicians complained that the Department of Homeland Security slashed counterterrorism funding for the city by $83 million, while funding was increased in places like Louisville and Omaha.

The blame is being laid at the feet of the Department of Homeland Security:

Rep. Peter T. King (R-N.Y.) said New York City has been told to expect to receive $134 million, 8 percent more than last year but $73 million less than in 2005.

Both totals could change before a Homeland Security Department announcement on the grants, which is expected later this month, several officials said.

King, the ranking Republican on the House Homeland Security Committee, said Homeland Security officials “still just don’t get it.” “New York is by far the number one terrorist target in the country, and no one else is even a close second,” he told the Associated Press. “That’s the reality. I’m disappointed and angry.”

Although I absolutely believe that New Yorkers should have the resources to deal with the dangers that manifestly face them, I think they’re looking in the wrong direction for help.

The structure of our tax system ensures that much of the revenue taken by the federal government from the people of the country comes out of the pockets of people living in its big cities and the suburbs that surround them. People in New York, Chicago, and Los Angeles pay more taxes on average than people living in Florence, Alabama or Sidney, Montana and the states in which these cities are located pay out more of their income in federal taxes than they receive in federal revenues.

The structure of the Congress ensures that a disproportionate amount of federal government expenditures will be in rural areas and small towns.

The structure of the federal government ensures that a disproportionate amount of federal government expenditures will be in Washington, DC and its environs.

Higher federal taxes reduce the ability of states, counties, and municipalities to raise revenues of their own. People will only accept so high a total level of taxation. That the American people’s appetite for the benefits of federal spending is dysregulated from their willingness to pay taxes is a subject for another post.

Given the incentives and structures that are in place the federal government is doing exactly what you’d think it would do: it’s shortchanging cities and their contiguous suburbs and that’s just as true of counter-terrorism funding as it is of highway funding. That’s exactly what has been happening for at least the last 70 years and our cities are starting to look a little worse for the wear.

However, the solution to what is clearly a real problem is not to demand more from the federal government but to demand less. If the federal government sticks more to its knitting and does a better, more prudent job of managing the tasks that only the federal government can undertake e.g. defense (as in the military) and foreign policy and keeps its nose out of things that state and local government should be managing on their own (and reduces the federal government’s share of the taxation pie commensurately), then state and local governments will have more resources to do the things they need to do. Or decide that they don’t really need doing, as they prefer.

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