Originally Posted by sokinwet
Totally agree with your 1st point DB; things are tough for "everyone"...including municipal employee's. A couple of points to consider in your private sector arguement. The "widget co." sells a bunch of widgets to consumers, makes a profit & hires a few employees. Things are lookin good...until the widget market dries up, then with less "demand", less $$ is coming in and something has to give. Maybe it's the co. or the employees that take the hit, regardless it's the reduced demand for the product that causes the problem and it's not really feasible to pass the costs on to the consumer due to decreased demand.
Reduced demand is one scenario. The private business offers a specific product for which demand wanes. The business must cut back or fold. The Public sector, as it grows to a complex offering of services, can impose "demands" which not every tax payer wants, needs, agrees with, or ever uses. Once upon a time it was illegal for public sector employees to strike. That was tested when friendly judges were in place, and voila, what was clearly illegal magically became OK. Public sector unions were formed and the ills that plagued the private sector and brought industries to their knees, now filtered into government. Services, especially for those who don't support them through tax donations, became a "demand" in plush times when they seemed affordable, and, voila, that which is encouraged, grows.
Another scenario is the effect of competition in the private sector. Private companies can suffer not only from the loss of demand, but from the inability to compete. The public sector is a monopoly and can dictate not only what is "demanded", but the quality and price. This often leads to not only providing services that the majority of taxpayers don't use, but to providing services at reduced efficiency and quality, and, since there is no alternative, at higher costs. It is a sorry phenomenon that government employees are now on aggregate at the high end in salaries and benefits for similar work.
The situation for municipal government isn't the same; generally the demand for services increases, especially in a growing community (Mansfield?) that sees lots of residential development...more kids in schools, more roads to plow, etc.
If the demand increases due to a growing community of tax-payers, which also includes more jobs and businesses to accomodate them, there should be enough money to cover costs due to the greater influx of revenue. Of course, if the growth is of the non-tax-contributing kind, and if "demands" were created for services to such growth, you have the reverse of private sector solution. You do pass the cost of your loss of revenue to the paying customer and call it his fair share.
Municipal gov.is not a "profit making" enterprise, it's business is to provide public services at cost. The revenue coming into municipalities is severly impacted by the economy; less state aid coming in & reduced RE tax revenues due to delinquencies resulting from the poor economy, etc. However, municipalities are required by law to submit a balanced budget every year, so with 2 1/2 limitations and reduced revenues there are only so many options. Municipal governments responsibility is to operate as efficiently as possible while meeting the needs of residents, but beyond that when costs exceed revenues who should pay. It's either cut services, make public employees absorb the losses or everyone pays their fair share. Having just gone through the "budget battle" I can tell you that fat in municipal budgets is a thing of the past and the projections for the next fiscal year are worse. If you knew how many municipalities are close to "going out of business" you'd be shocked. It's time for tough "responsible" decisions on everyones part...I'm just glad I drive a 4WD truck and my kid is out of school!
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