The Positive Side of a Revenue Crunch

The business community is no better than local government when it comes to making hard decisions about personnel and program cuts. For all the wailing and moaning about budget squeezes, most public officials will privately tell each other how some needed waste got eliminated for the good. Heck, that is the nature of entire economy. The excess and inefficient are allowed up to a point and then there is a system purge. We don't need that many grocery stores and car dealerships. We can't afford that much overhead.

When we make the tough decisions under pressure, we publicly confess that we don't manage until we have to. The excess and inefficient was there all along.

The public, knowingly or unknowingly handle their reaction to the threats of quality of life decay, threat of the sky falling and loss of life and property pretty simply. They can't understand or don't believe the rhetoric so they take the easy way out. "Cap it" is short for "shut up, I don't want to hear any more." You figure it out, mayor or city manager.

Of course, the other side of this is to fire back with "CAP IT" when between budgets and tax rate hearings there is a long list of needs and wishes brought to the city for funding.

But there is the deal. There are going to be economic cycles just a sure as the sun is going to rise and set.

Let me say it this way: it is with absolute certainty that we will come out of this economic cycle (maybe slowly, maybe modestly) only to be faced with another slump after the rise. It is likely to be 4-6 years after we get back to better times. Just living with that assumption for a minute to keep me happy, my question is this: what are you going to do differently to make the next recession more orderly and less painful.

For most businesses and governments, the answer is NOTHING. We will not have the courage or influence or staying power to take needed actions until the motivation is forced on us. We are a "the devil made me do it" kind of society.

But the next recession is likely to be the biggest of them all, the final bang. In fact, we really may not make much of a recovery before the contraction is severe - the "... then suddenly" part of Hemmingway's bankrupt scenario of "gradually, then suddenly.

We have moved into an exponenital mode for: Baby Boomers; heatth care; pensions, cheap resources; infrastructure aging, infrastructure capacity, the cumulative result of over-promising and the burden of keeping the world peaceful.

Toffler's Future Shock and Orwell's 1984 on steroids! Lord, forgive us! LFM