MARCUS: Daniels ignores deficit of neglect

Morton Marcus
January 15, 2011
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Morton Marcus

When Mitch Daniels speaks his mind, he usually thinks through his positions carefully. It was no surprise, therefore, that he thanked Illinois for considering higher taxes to combat its financial difficulties. Higher taxes in our neighboring state, the governor contends in an interview with the Northwest Indiana Times, will drive residents and businesses to Indiana.

Daniels believes, if I may speak for him, that government needs to moderate its programs in times of economic distress. He proudly holds the line on taxes and cuts spending in order to sustain Indiana’s good fiscal condition.

He recognizes our financial problems. Unfunded pensions remain a liability for state and local governments. We are in debt to the federal government because of an underfunded unemployment compensation fund. Our local infrastructure reveals serious neglect.

To balance the Hoosier budget, we (yes, you and I are as culpable as the governor and the Legislature) have cut services to those who are in serious need and often have no voice to object. One example will do: The Bureau of Developmental Disabilities Services has cut funding for people who require 24/7 supervision and assistance. Often, their emergency needs cannot be met adequately. It may be good fiscal management, but it is heartless, dangerous neglect.

Nonetheless, this is the Indiana to which we hope to attract Illinois residents and businesses. Our workers struggle to receive justified compensation for injuries on the job. Our unemployed must make do with less generous payments than similar people in other states. Our schools are inadequate by most measures. Our local streets and roads are in poor-to-dismal repair. Our highway program is more than a generation behind. Ancient sewerage systems all over the state are in need of modernization. Public transit is on life support where it still exists.

All these deficits, but we have a balanced budget!

Do Hoosiers have such low opinions of themselves that they truly condone such neglect? Is private household consumption for Valentine’s Day and Halloween so important that we are unable to raise annual taxes by the amount we spend on those blatantly silly events?

To attract more businesses to Indiana, we could accelerate depreciation on capital investments. That is, if a firm makes an investment in Indiana, the company could recoup that expenditure faster than allowed on the federal return. This would make Indiana a more attractive place for business location and create better jobs for our citizens.

In the long run, a place (city or state) will attract households and businesses through the services it offers, not the taxes it does not collect. Our political leadership knows this, but ignores it. Most public officials focus on election rather than service.

When pandering to the worst aspects of public opinion, elected officials say things like, “My job is to protect the interests of the taxpayer.”

This is sad. The statement presumes that citizens think of themselves only in terms of taxes paid and not services enjoyed. Yet, that is how citizens think, because public officials constantly address us as taxpayers and not as consumers of government services—clients of government agencies.

Language shapes thought. It is time to recognize that we are much more than just taxpayers. Perhaps that is happening in Illinois.•


Marcus taught economics for more than 30 years at Indiana University and is the former director of IU’s Business Research Center. His column appears weekly. He can be reached at mmarcus@ibj.com.


  • unacceptable
    The elderly and disabled had equal civil rights last time i checked and infringing on those rights to balance the budget is unacceptable. A culture that treats certain groups of citizens as acceptable collateral damage is NOT good enough! Sometimes the truth is ugly but that doesn't mean it's biased. p.s. The Asian coutries treat their elders with much more respect and reverence then we do.
  • Article
    I think folks in Indiana are getting what they ask for -- low taxes and low services. Indiana folks are not into govnt providing much of anything. And so they see no value in most new services proposed. And so Mitch seems to be catering to what the people desire. And regional mass transit will be a great litmus test to check on our collective attitiudes. I think mass transit would be great. Most people I know think I am crazy for having such a notion. Also, tell me what govt hasn't cut services for the disabled/poor? Our society historically treats the disabled/poor better than any place in the world, yet we do not do near enough. I think this article is somewhat biased against Mitch, as has been the IBJ.

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  1. If what you stated is true, then this article is entirely inaccurate. "State sells bonds" is same as "State borrows money". Supposedly the company will "pay for them". But since we are paying the company, we are still paying for this road with borrowed money, even though the state has $2 billion in the bank.

  2. Andrew hit the nail on the head. AMTRAK provides terrible service and that is why the state has found a contractor to improve the service. More trips, on-time performance, better times, cleanliness and adequate or better restrooms. WI-FI and food service will also be provided. Transit from outlying areas will also be provided. I wouldn't take it the way it is but with the above services and marketing of the service,ridership will improve and more folks will explore Indy and may even want to move here.

  3. They could take the property using eminent domain and save money by not paying the church or building a soccer field and a new driveway. Ctrwd has monthly meetings open to all customers of the district. The meetings are listed and if the customers really cared that much they would show. Ctrwd works hard in every way they can to make sure the customer is put first. Overflows damage the surrounding environment and cost a lot of money every year. There have been many upgrades done through the years to help not send flow to Carmel. Even with the upgrades ctrwd cannot always keep up. I understand how a storage tank could be an eye sore, but has anyone thought to look at other lift stations or storage tanks. Most lift stations are right in the middle of neighborhoods. Some close to schools and soccer fields, and some right in back yards, or at least next to a back yard. We all have to work together to come up with a proper solution. The proposed solution by ctrwd is the best one offered so far.

  4. Fox has comments from several people that seem to have some inside information. I would refer to their website. Changed my whole opionion of this story.

  5. This place is great! I'm piggy backing and saying the Cobb salad is great. But the ribs are awesome. $6.49 for ribs and 2 sides?! They're delicious. If you work downtown, head over there.