For the moment, policymakers can be forgiven for possessing a one-track mind. Official Washington is gripped by an all-consuming budget fever—and the only cure is a deal to avert the so-called fiscal cliff. But even after officialdom solves today’s problem, tomorrow’s awaits: In the coming months, policymakers will likely push toward large-scale entitlement reform or, even more ambitiously, tax reform. In the queue behind those monumental challenges are some of the most significant and thorny issues facing the country, including the need for sweeping changes to the nation’s immigration laws and the threat of a warming planet. By the end of 2013, there won’t be much political oxygen left in this town for anything else.
But a host of other, everyday problems will continue to vex Americans—problems that Washington may be either unwilling or unable to tackle. These demand attention far outside the Beltway, at the local level. They include the burgeoning traffic on our streets and highways; the shrinking pool of affordable housing; escalating gun violence; the rising invasion of online privacy; the strain on municipal services; and the high cost of healthy food. Even the challenge posed by runaway defense spending (a top-down, D.C.-driven issue if there ever was one) can benefit from more national popular support for a leaner, more efficient military in a postwar era.
All of these problems are threaded throughout the fabric of the nation. And if they are to be solved, the people, not the Washington pols, will have to be the ones lighting the way.
Reform the Tax Code to Aid Owners and Renters
The trend toward New Urbanism—which unites housing, retail, and open space, while placing a premium on walkability and reducing the need for long automobile commutes—has been cheered by environmentalists and many residents. But the higher costs of living associated with such development risk squeezing some renters out.
Academics and advocates have long argued for preserving existing affordable-housing inventories through grants and subsidies, but even then, units are often protected for only a fixed number of years before they go on the open market. A growing push toward “inclusionary zoning,” which requires that a certain portion (usually between 10 and 20 percent) of units in new or rehabbed developments be earmarked for affordable housing, could help lower-income urbanites. In exchange, local housing authorities give breaks to developers on density limits or charge them fees that are then funneled to housing assistance. This type of zoning requirement has made inroads over the last 30 years in places such as Montgomery County, Md., San Francisco, and Boston.
The key, advocates say, is to ensure that affordable units are built into the city’s fabric as more and more communities realign themselves along transit lines. “What we want to do is target areas where housing prices are likely to go up in the future,” says Jeffrey Lubell, the executive director of the Center for Housing Policy at the National Housing Conference. Citing a neighborhood in Washington, he says, “The idea would be to find a Columbia Heights five or 10 years before it starts to happen and really get in and put the policies in place so that as the neighborhood becomes more attractive and marketed to tenants and higher-income folks, moderate-income families are not displaced—and also that a share of the newly developed and newly renovated housing is available.
“Tying this in part to public-transit expansion is one way to get at this,” he adds.
But one challenge of inclusionary zoning is that it “only works in a strong market with pent-up demand,” says Clark Ziegler, the executive director of the Massachusetts Housing Partnership.
A more radical proposal to assure affordable housing is to alter the U.S. tax code. The mortgage-interest deduction has long been criticized for channeling the greatest amount of relief to the wealthiest. Under current law, tax filers can claim a deduction for interest on mortgages and home-equity loans of up to $1.1 million.
The National Low Income Housing Coalition is pushing to reform the tax break in a way that it says could help President Obama toward his goal of ending homelessness and shrink the 4.5 million shortfall of affordable-housing units for the 10.8 million people at the lowest income levels. The coalition advocates dropping the mortgage cap to $500,000 and converting the itemized deduction—which benefits only about quarter of taxpayers, according to the Internal Revenue Service—to a 15 percent nonrefundable tax credit.
“When you convert the deduction to a credit, you make it available to low-income homeowners who do not get a tax benefit for having a mortgage because they either don’t make enough money or they don’t pay enough in interest to itemize,” says Sheila Crowley, the group’s president and chief executive. “If you convert it to a credit from a deduction, then you catch non-itemizers; you will significantly expand the number of households who will get a tax break.”
The proposal would save between $20 billion and $30 billion a year, which the coalition would like to see redirected to the National Housing Trust Fund or other programs to increase affordable rental housing for low-income people.
Build Bonds at the Neighborhood Level
When it comes to reducing gun violence, it becomes nearly impossible to separate policy from politics and to isolate illegal gun users from legal ones. The recent move by Cook County, Ill., to charge a surtax of $25 on gun purchases, considered a radical step, is expected to do little to curb the escalating murder rate in the Chicago area. (Indeed, even its supporters concede that the tax is more about raising revenue to help defray medical costs stemming from shootings than about discouraging gun ownership.) Buyback programs have taken illegal guns off the street but have done little to stem the flow of illicit weapons in the first place. Buyers routinely evade ownership restrictions through the use of straw purchases—third parties who purchase weapons on behalf of another. And it is axiomatic that any sort of national gun control (even a restriction on the kind of assault weapons used in mass shootings, such as the one last summer in Aurora, Colo.) is a nonstarter in Congress among Democrats and Republicans alike.
But an increasing body of research argues that politics itself, in the Aristotelian sense, could make for good policy—and that looking to Washington for help isn’t the correct instinct. Study after study has found a strong correlation between the level of civil engagement in a community—what researchers term “social capital”—and the homicide rate. In a sense, the research is telling us what we already see with our own eyes. Homicides (by gun or otherwise) are more prevalent in areas that lack strong, cohesive bonds, whether woven through government outreach, church, kids’ sports teams, farmers’ markets, bowling leagues, or what have you. Put another way, where residents don’t feel a sense of community, they don’t feel protected. In that vacuum, gun ownership rises—and with it, the possibility of escalation. “People who feel less connected to their neighbors, their neighborhood, and their society have fewer restraints on their behavior,” says political scientist Daniel Aldrich of Purdue University. “So in communities that are fragmented and lack trust, we see more crime.”
That’s part of the reason that Chicago, under Mayor Rahm Emanuel, has agreed to pay $1 million to the antiviolence program CeaseFire to mediate gang conflicts in its most war-torn districts. An initiative of the Chicago Project for Violence Prevention, CeaseFire uses felons and former gang members to deal directly with gangs, providing an element of trust on the street that the beleaguered police can’t offer.
Trust is one thing, but researchers Blaine Robbins and David Pettinicchio of the University of Washington say that inspiring citizens to become politically active could make the greatest difference in reducing violence. Their research shows a strong negative correlation between social activism and homicide rates worldwide, even more than the link between crime and income inequality. “Being involved matters,” Pettinicchio says.
The concept isn’t new, he adds. It was espoused almost 200 years ago by Alexis de Tocqueville, who argued that a willingness to engage politically also means a willingness to contribute to the common good. However, the challenges in places like Chicago are evident. Not only does a culture of violence need to be rewired but a culture of civil alienation has to be ended. Sounds like what the city could use is a decent community organizer.
Let Citizens Help Decide Where to Trim and Save
The financial crisis hit states and cities hard. Cash-strapped municipalities, struggling to provide basic services, began relying on volunteers or sharing resources with neighboring cities to meet their citizens’ needs. At the same time, voter dissatisfaction with the federal government reached record highs.
One growing trend offers the promise to help mollify angry citizens who think their local governments are wasteful, while also reaffirming the civic bond. Some jurisdictions across the country are experimenting with allowing citizens to decide how their tax dollars should be used. The process, known as “participatory budgeting,” was developed in Brazil in 1989 and spread throughout Latin America and other parts of the world over subsequent decades.
Here’s the basic idea: The controlling authority, be it a city council or an office with a discretionary fund, solicits ideas from the public online and in town-hall meetings for spending taxpayer money. Volunteer delegates cull through those ideas, determine the costs, and put the most feasible ones on a ballot for residents to vote on.
It’s not just an exercise in civic engagement; participatory budgeting also has the potential for saving money—as well as instilling a greater sense of community ownership in residents. “When people get their hands dirty and start to really delve into public spending and what money goes toward, they’re shocked at how expensive things are, and they work really hard to find ways to make them more affordable,” says Josh Lerner, executive director of the nonprofit Participatory Budgeting Project, which helps communities set up such systems.
Chicago alderman Joe Moore, who represents the Windy City’s 49th Ward, is credited with bringing the process to the U.S. It has spread to parts of New York City and, most recently and on the first citywide scale, to Vallejo, Calif., home to more than 100,000 people.
Vallejo, which is near San Francisco and filed for bankruptcy protection in 2008, opted to raise revenue through a new sales tax, but it is letting its citizens decide how to spend about $3 million of that money. Residents are invited to attend assemblies featuring refreshments and, in some cases, Spanish interpretation and child care, or to submit their ideas online. Proposals range from putting cameras at the city’s traffic intersections, to extending the farmers’ market’s hours, to funding a K-12 after-school arts program.
Participatory budgeting has shown promise at the local level. Asked if it would work on a statewide basis in the United States, Lerner says he thinks it would, but adds, “I think we still have some work to get there and that this is a huge learning process for everyone involved.” He points out that it took Brazil a decade to experiment at the statewide level. Still, Lerner’s organization receives about one inquiry a week from a curious elected official or institution. “The initial roadblock was that people would say this wouldn’t work in the U.S,” he says. “And that’s getting increasingly difficult to say, because it has worked in the U.S.”
Municipalities’ fiscal problems aren’t expected to diminish anytime soon. A September report from the National League of Cities predicted that municipal budgets are likely to remain challenged in 2013, even if the national economy grows—meaning that resources will be scarce and competition for them intense. Participatory budgeting won’t cure those ills, but it could give residents a greater voice—and a greater stake—in the process.
Protect Yourself, Because Congress Won’t
The e-mail and adultery scandal that torpedoed the career of soldier-spy David Petraeus doesn’t signal the death of privacy on the Internet, but the reelection of his former boss just might.
The organizing behemoth that powered the Obama campaign to victory in 2012 combined information from such disparate sources as public voting records; consumer databases; pools of Internet tracking files, or “cookies”; and the information gleaned through the campaign’s volunteer effort to identify, target, and influence potential supporters. The elected officials with the power to restrain the way data collectors follow the tracks and mine the information of consumers are now among the chief beneficiaries of the practice, and that doesn’t bode well for a regulatory fix.
“That’s the problem,” says Pam Dixon, executive director of the World Privacy Forum. “All the things that allowed Barack Obama to win the election are the things that are problematic for American privacy.” She is especially worried about how the online and offline identities of consumers are getting mashed up in databases to create detailed dossiers that can be bought and sold by marketers and potentially stolen by data pirates. “Linkages based on credit cards get very deep very quickly,” Dixon says.
Legislative efforts to corral data collection, notably those backed by the bipartisan team of Reps. Joe Barton, R-Texas, and Edward Markey, D-Mass., have generated more light than heat. There’s little the states can do individually, as Connecticut found out when it tried to bring a case against Google for its “Wi-Spy” scandal in which its roaming Street View cars turned out to be vacuuming data from unsecured Wi-Fi networks.
California might be the exception. A court case there will determine whether online merchants are subject to a state law that bans mandatory data collection as a condition of accepting credit-card payment. If privacy advocates are successful—a big if—it could mean a rethink about how online commerce is conducted.
In the meantime, a little tradecraft is necessary for consumers, Dixon says, to keep marketers from connecting all the dots. Spread online shopping across different credit cards, so that your purchasing habits aren’t tied to a single account. Create separate e-mail accounts to use for different online activities, and don’t include any personally identifiable information in the addresses. Adjust privacy settings on sites that have them, especially mobile applications that can sniff out your location. A few search engines such as DuckDuckGo don’t store searches from one visit to the next, eliminating the trail of virtual bread crumbs.
Use random number generators to create e-mail addresses. Don’t use the same password across your various online accounts; make up separate nonsense passwords and store them using a trusted password-management system. The Firefox browser will do this for you, or you can use a dedicated tool such as LastPass or KeePass.
Clearing out tracking files from a browser can do only so much, because of the proliferation of so-called flash cookies that burrow deep into a user’s computer and spawn new tracking files without any user notification. These require a separate tool, like the Firefox add-on BetterPrivacy.
These fixes are for the most part easy, one-button downloads. The kind of operational security that would have saved Petraeus requires a little more discipline. “Security, privacy, and convenience are almost always direct trade-offs,” says Eva Galperin, who works on global freedom of expression issues at the Electronic Frontier Foundation.
The big gun in the fight for personal anonymity is the Tor browser, which masks a user’s true IP address, concealing identifying information from anyone who might be trying to look. It helps bloggers publish in the face of repressive firewalls, whistle-blowers dish to journalists, and battered women hide out from vindictive exes. However, it’s difficult to use. As always, freedom carries a price.
Do Away With ‘Little Americas’ Worldwide
One iron law of Washington: When wars end, defense budgets decline. With war-weary Americans facing a massive debt crisis, with the U.S. still spending more on defense than the next 10 nations combined, and with the winding down of the longest war in the country’s history, there’s good reason to believe that the rule will hold. Postwar drawdowns of the past half-century have typically reduced defense budgets by one-third, suggesting that the already announced $487 billion reduction in defense spending over the next decade may only be a down payment.
The problem for Defense Department planners trying to anticipate those cuts over a five-to-10-year window is a lack of reliable partners. Nowhere is that more evident than in the current budget impasse. If the Obama administration and Congress remain deadlocked and drive over the fiscal cliff, they will trigger sequestration and another half-billion dollars in across-the-board cuts that the Office of Management and Budget refuses to let the Defense Department even plan for. Essentially, both sides have agreed to hold the Pentagon hostage to their own dysfunction.
But action, not dysfunction, is needed. Washington has to embrace a bold strategy acknowledging that the United States is entering a period of retrenchment when it must husband its resources and restore fiscal balance, even as the Pentagon recapitalizes an aging military arsenal. Such a blueprint for lean times would not simply ask the already tired armed forces to constantly do more with less. Rather, it would direct them to do less with less, and to do it differently.
As it happens, under the leadership of Defense Secretaries Robert Gates and Leon Panetta, the Pentagon has already made significant strides in that direction. As the 9/11 wars come to an end, the administration will have to go further in refining and institutionalizing a strategy of retrenchment, which President Obama has foreshadowed with his insistence that now is the time “for nation-building here at home.”
The Pentagon’s 2012 national-security strategy and the administration’s “pivot to Asia” were a good start. Together they will reduce ground forces by 100,000 troops, pull two heavy Army brigades from Europe, beef up the special forces, and shift the Pentagon’s focus to the maritime theater of the Asia-Pacific.
The strategic implications of those moves are clear. NATO allies will have to assume more of the security burden in Europe’s backyard. The United States will not launch another manpower-intensive counterinsurgency and nation-building operation on the order of Iraq or Afghanistan for the foreseeable future; it will, instead, counter the terrorism threat with discreet, targeted operations by special-forces strike teams and CIA drones. The Pentagon’s priority is to hedge against a rising China with a larger air and naval presence in Asia.
At the same time, the Defense Department is moving toward a more expeditionary model that could save billions of dollars. Rather than building or maintaining “little Americas” overseas for service members, their families, and a supporting cast of thousands, the new model relies on shorter rotational deployments by military units based in the United States.
How would such a strategy look in practice? When Obama insisted that Britain and France lead the NATO operation in Libya last year that toppled Muammar al-Qaddafi, and limited the U.S. contribution to air power while eschewing boots on the ground, he was criticized for “leading from behind.” Under a strategy of retrench and restore, the Libya operation would be a template for dealing with second-order threats.
Rebalancing the U.S. military’s lopsided “tooth-to-tail” ratio could save billions more. In a new study titled “Department of Everything,” Sen. Tom Coburn, R-Okla., proposes commonsense cuts to defense that could deliver $69 billion in savings over a decade without severely hurting war-fighting capabilities, including eliminating the 64 elementary and secondary schools the Pentagon operates on 16 stateside military installations; getting the Defense Department out of superfluous activities such as cancer research; cutting back on military bands, which cost $320 million each year; and returning to a Cold War ratio of five general officers per 10,000 troops (as opposed to the seven the Pentagon has today), paving the way for eliminating 800 staff and support personnel.
Stop Propping Up the Market With Subsidies
The United States is spending about $30 billion a year on farm subsidies, and it’s a complete waste of money. So says New Zealand, anyway.
Each year, Congress doles out billions of dollars to support agriculture. The $30 billion figure comes from the Cato Institute and broadly goes for direct payments to farmers, subsidies for various insurance programs, and agricultural research. But if the United States were to follow the path laid out by New Zealand, we could save ourselves the cash, perhaps do some good for the environment, and maybe even lower the cost of healthy food.
Facing a budget crisis, the Pacific nation decided to do away with nearly all of its farm subsidies in the 1980s. Some farmers protested, but the measure passed in 1984. Few farmers would say the adjustment period was easy, but only about 1,000 of them (close to 1 percent) were forced to give up farming, and today New Zealand still has nearly the same percentage of its population farming that it did nearly 30 years ago. “With the subsidies, we didn’t have a competitive economy,” says Mark Ross, the general manager of the Federated Farmers of New Zealand. “Without the subsidies, we were forced to innovate and actually respond to market signals.”
Instead of just producing lamb and dairy, two of the heavily subsidized commodities, the agricultural community diversified. Among other products, the farming of kiwifruit rose in Kiwi country. “It got the government out of the space between us and the marketplace,” Ross said. Without the subsidies, farming contributes about 5 percent of the New Zealand’s gross domestic product, about the same as it did before 1984.
But could that cold-turkey approach work for the United States? Standing in the way is the all-powerful agribusiness lobby. However, Chris Edwards of the Cato Institute—a libertarian think tank with exactly this type of free-market world vision— says that farm groups need to quit their bellyaching. “Frankly, I think they are kind of a bunch of babies,” Edwards said of the farming sector. “They are the most coddled industry in America.”
There is also a strong conservation benefit to getting rid of agricultural subsidies, Edwards argues. Currently, the government provides an incentive to grow products such as corn, wheat, and soybeans. And with the extra incentive, farmers will often plant those products even if it’s not the best crop for their acreage—or, worse, convert wetlands into croplands.
Opponents of farm subsidies say that Americans need not worry about the impact that ending farm subsidies will have at the grocery store. “All the evidence is that there would be virtually no change of the price of food at retail,” said Scott Faber of the Environmental Working Group. In fact, he said, if the United States were to go to an even more free-market-based system and remove food tariffs, consumers would benefit. “If you were able to make global agreement, prices would fall across the board,” he said. “We would export far more to developing nations. And farmers would make up in volume what they make in price.”
According to Yale University’s Rudd Center for Food Policy and Obesity, bringing the Agriculture Department’s spending under control could perhaps lower the cost of fruits and vegetables, which would no longer be competing with artificially subsidized products such as corn and meat. The government subsidies have also allowed the food industry to sweeten a variety of foods with high-fructose corn syrup. Doing away with subsidies could help America’s budget and its citizens both become leaner.
Convince Drivers That Roads Aren’t Free
The federal government has failed miserably at keeping a steady stream of reliable funding headed to the states for roads. It’s time for Washington to get out of the game. In the past year, lawmakers couldn’t even put together a whole highway bill, barely cobbling together enough money to cover two years when past measures have spanned five to six years. (The last full highway bill passed in 2005.)
Meanwhile, traffic is getting steadily worse. The most recent analysis from the Texas A&M Transportation Institute found that, nationwide, the average commuter endured 34 hours of delay in a single year, up from 14 hours in 1982. What’s more, those delays cost $100 billion in lost productivity, the researchers say.
The New Deal-era notion that roads should be free is outdated. They aren’t free in reality, of course, but if travelers see them as such, they will use them without regard to the consequences—congestion, road deterioration, and pollution. The current federal payment system (taxpayer dollars) is so removed from the product (smooth roads and transit options) that drivers aren’t invested in finding solutions. They’re left to honking their horns.
Some options to reduce traffic are costly, but others can be implemented with a can of paint. New York City has seen its automobile traffic thin with an increased emphasis on pedestrian and bike paths. Car-culture areas such as Los Angeles and Northern Virginia are experimenting with variable-priced tolls that guarantee drivers a certain speed. The price goes up when congestion gets worse.
The common thread is that decisions are made on a local level. In Denver, city planners went to neighborhood representatives to divvy up their streets into parking areas, bike lanes, mixed-use lanes, and green medians. Residents and business owners did the prioritizing. City officials simply followed their directions. “Local government has to make the choices,” says Gideon Berger, an urban planner who headed the Denver project. “Local government has citation and permitting authority. The role of the private sector is so important.”
The private sector is taking the lead in building new toll roads to manage traffic, but the threshold challenge is convincing drivers they need to pay. (Take the underused Inter-County Connector in the Maryland exurbs around Washington, for instance.) The International Bridge, Tunnel and Turnpike Association is looking to shift public opinion on that front. According to the group’s CEO, Pat Jones, roads should not be considered any different than basic utilities. “The only difference between roads and smartphones, electricity, and water is that it is very easy for the provider of the smartphone, the water, and the electricity to shut it off if you don’t pay,” he says.
Shutting down roads is a little harder than turning off phone service. And ensuring that citizens have access to every place they need to go should be a national goal. But drivers, local businesses, and local governments are in a far better position than the feds to determine how to get there—and how much travelers should pay for the ride.