Trickle Down Economics…The Trickle Hits Home

We have, as a nation the discussion that surrounds economic principles.  The perception is that there are two sides…those who want to starve the nation with low taxes and small government at the expense of services and infrastructure AND, on the other side a group that wants to tax at will, providing services to everyone, no questions asked.

I have found, while digging through this conversation for a couple of decades that neither side really exists, except on the fringes of our political landscape.  It is easy to talk in hyperbola about those you oppose, the examples are usually just too good to resist.  But it doesn’t solve the problems.

When talking to those who want low taxes, small government I always ask one question…“What services and infrastructure are YOU willing to give up?”  The response is usually stone silence.  They are more than willing to make a detailed list of services that OTHERS should give up…but never any that they use.

So the conversation moved to “Trickle Down”.  It started as an economic philosophy in the early 1980s…cut taxes for those at the top and they will invest in the businesses of America which will create jobs, create wealth and create opportunities that would “trickle down” to everyone else.  History shows that, while looking good on paper the reality doesn’t reflect success of those goals.

But “trickle down” has another meaning that has manifested itself from years of low federal taxes…the trickle down to states and local governments…That for which they maintained responsibility is now being slowly [and sometimes not so slowly] choked to death because funds from the federal government are no longer easily available to those states and local governments.

The examples are nearly endless but let’s look at some close to home.  In my home county of Harlan, Kentucky the cuts in services are down to the very basics…they can’t buy police cruisers, they can’t bug spray their buildings, they can’t repair roads where slides have occurred, they can’t support their parks with the most basic of essentials…sanitary facilities and in at least one case they can’t even keep the phone for the Mayor’s office connected.

In districts throughout the country small volunteer fire departments are closing, cutting hours and working with broken equipment as they address one of the most fundamental obligations of a civilized government…fire protection.

But it is not just the small towns, the out of the way communities void of lush tax bases to help fund their infrastructure.  The problem is everywhere and it is growing.  Towns like Pontiac, Michigan have closed their police departments, relying on surrounding towns and the State Police to pick up the slack for basic police protection in that 60,000 population city. When you need 911…the waits can be nearly an hour.  Thank goodness 911 isn’t for emergencies.

In my own town of 300,000 and a very good economy [and a good stream of tax revenue] we are seeing the beginnings of reductions in service.  Fire coverage is affected by “brownouts”, the closing of some stations intermittently to save money.  Police do more with less…with police districts of 135,000 population patrolled by under 15 patrolmen.  It means fewer eyes to protect and serve.  They are further hampered by state laws which are intended to cutting prison and jail costs…the unintended consequence – if someone is caught stealing from cars, and the amount is under $500 value…they don’t get arrested, just a ticket.  The cities have little choice but to hope the thief learns his lesson with a fine – or as big businesses call fines…a cost of doing business.

Back to that question “what services and infrastructure are YOU willing to give up?”…the answer appears to be that we don’t have a choice, they are going to be cut, and we will have to give them up as if there was not an alternative.

But there is an alternative…but it will never be achieved as long as dogma replaces understanding of economic principles. It will never be achieved as long as folks don’t learn from history.

Let’s all just hope that when seconds count that volunteer fire department, or the large city fire department or ambulance is not minutes away.

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