The "utter disaster" of local and state cutbacks

Nobel Prize-winning columnist Paul Krugman observes the "utter disaster" of cutbacks at the local and state levels that are undermining economic recovery:

we’re sacrificing the future as well as the present. Oh, and the cuts that aren’t falling on investment in physical capital are largely falling on human capital, that is, education.

It’s hard to overstate just how wrong all this is. We have a situation in which resources are sitting idle looking for uses — massive unemployment of workers, especially construction workers, capital so bereft of good investment opportunities that it’s available to the federal government at negative real interest rates.

In Nashville, our stormwater infrastructure renovations lag behind projections and our services are slashed while funding flows unobstructed to projects that serve a limited clientele and benefit business within a narrow horizon of influence: building a convention center and keeping pro sports teams happy. The Courthouse class will not fess up to it, but funding for road maintenance has not been where it should have been over the last few years. Failing to prepare for the worst meant that unforeseen weather conditions took their toll on streets without any safety net. The convention center will create some local jobs, but it has not been the job stimulus that Mayor Karl Dean promised it would be:

the Music City Center convention hall has lost two and possibly three major bookings due to an expected delay in its opening, currently scheduled for April 2013. One group backed out even though its annual meeting was scheduled for June 2013 .... the delays are caused by a "series of setbacks, including flooding in Thailand that has delayed the manufacture of carpet for Music City Center."

The Music City Center is a $600 million public project sold to Nashville residents as a local stimulus package. But Mayor Karl Dean broke his promise that a "vast majority" of workers would be local residents, and 82% of contract dollars have gone to companies headquartered outside of Tennessee…though we are not sure if this figure includes Thai carpet manufacturers.

Meanwhile, Mayor Dean is floating the idea of of raising property taxes, even though everything is fine and we don't really need them.