The Private Cost of Public Poverty

“Starve the beast” has been the mantra of anti-tax Republicans for decades. But, so far, depriving the “beast”—big government—of revenue hasn’t led to starvation. The beast has had a credit card, a card with a seemingly perennial teaser rate and a credit limit it can more or less set itself. Republican politicians, who would have lost their power to vote tax cuts to their wealthy donors if they hadn’t been re-elected, have not wanted to be implicated in the demise of the source of national defense, social security, medical care, public education, veterans benefits, border protection, etc. So, even though they have controlled Congress and/or the Presidency for all but two and a half of the last twenty-eight years, the beast has always gotten his trans fats and, with minor exceptions, the Republicans have been at least as complicit as Democrats in the fact that the perennially maxed-out credit card keeps overtaking whatever credit limits have been put in place.

Now the Republicans are truly out of power and, if you believe them, the Democrats are using the federal credit card to throw one crazy party. Yet, while it now indeed appears that the fiscal year 2010 federal deficit could surpass 13 percent of GDP, the borrowing is hardly paying for a party. Ironically, with the Democrats in full control of the federal government for the first time in 14 years, the beast, while in no imminent danger of death by starvation, is gravely malnourished. This is the case because the beast has two components: the federal government, but also the many state and local governments. Only the former has a credit card. Aside from tax revenues, state and local governments survive on charity from the feds and very limited borrowing power from other sources.

The malnourishment is at the state and local level. Yesterday’s Washington Post reports how widespread layoffs and curtailment of services by state and local governments are accelerating in spite of the $135 billion dollar “stabilization fund” that is being funneled to the states from the stimulus package (a fund cut by more than $40 billion to win the support of the three Republican senators who voted for cloture). The worst is yet to come. The executive director of the National Governors Association has testified that states are facing a $200 billion deficit over the next two years, a deficit that, in the absence of more federal assistance, can only be covered by lay-offs.

The trauma of my native state of California has been especially acute and is about to get worse. With housing values falling 40% or more and unemployment at 11.2% as of mid-April and climbing, the State has already suffered through a protracted political standoff between Democratic and Republican lawmakers to plug a $41 billion budget shortfall. The deal that was finally  struck will entail many painful cuts. In March, the month after the deal was struck, 27,000 educators received lay-off notices. Moreover, the complicated deal is in large measure contingent upon approval of a series of ballot propositions that are set to be voted on May 19. With plenty not to like in the details of the compromise, it appears that the propositions will get the thumbs down.

It took the better part of a year to achieve the compromise that will probably fail, so the prospects for a better, or least more palatable compromise any time soon appear dim. The State will run out of money in July. Stay tuned.

Joy in Limbaughland? Laid off school teachers, nurses, firemen, and policemen, overcrowded emergency rooms, courts that don’t function, motor vehicle offices that are open three days a week. Are these the images that will warm the hearts of the anti-tax Republicans? Probably not, and they certainly won’t increase the prospects of a Republican resurgence any time soon.

Government is not a beast. If the banks are the life support of the economy, our various governments are the sine qua non for our quality of life. They mete out justice, protect us from violence and environmental degradation, educate our children, construct our infrastructure, provide medical care to the aged and disadvantaged, and are the expression of our common values and democratic choices. The consequences of depriving our state and local governments of critical funding will be felt at a very human level by our most vulnerable citizens. The private cost of public poverty cuts to the heart of what makes us a great nation, the “Shining City on the Hill” so dear to disciples of Ronald Reagan. President Reagan was fond of saying that “government is the problem.” If nothing else good emerges from these next few months in states like California, at least the facile rhetoric of “government is the problem” and “starve the beast” will finally, a generation after Reagan, have lost its currency.


Clay A. Dumas ’10, a former Crimson associate editorial editor, is a social studies concentrator in Lowell House. His column appears regularly.