Tuesday, March 06, 2007

Fiscal State of the Nation Is Questioned By All

As many cities and towns in Utah prepare for the onslaught of "Budget Season", I thought this video link to a recent 60 Minutes interview regarding the fiscal condition of the nation would provide some sense of ease-- at least for now. As you will see the dilemma that we face nationally makes our local issues pale by comparison -- Hey whats $23 Billion in transportation needs in Utah when David Walker, Comptroller General of the United States, is talking about Trillions upon Trillions in entitlements with no way of sustaining the inevitable demand.

So why should cities and towns in Utah care? Well, as we continue to rely on partial federal and state funding for many of our local projects the pressure that many of these entitled federal programs will place on mandatory federal and state spending will have a ripple effect on much of the discretionary spending that we as cities and towns rely upon for matching funds. Matching funds for security, policing, transportation, water development, critical lands protection, social services, CDGB, etc. will all suffer from an unsustainable federal budget that is currently being consumed by current mandatory spending programs.

While many in the past have looked at similar analysis as a "Chicken Little" approach to the the economy and fiscal condition of the nation, it should be noted that the current assessment is almost universally accepted. The one thing that becomes clear is that simply "growing our way out" of this mess is not the answer. While it may be part of the solution, we will have to be far more creative and nuanced in our approach to federal, state and local tax policy in the years to come.

Hopefully the work of the Utah State Legislature, Governor and others is a sign that we are not the only ones who recognize the Tsunami that is ahead of us unless we get out in front of this problem now.

Take a look -- I would love to know your thoughts.

ENJOY -- Lincoln