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EYE ON THE PIE: Indiana turning toward Houdini plans

January 16, 2006

"What should the Indiana General Assembly do during this session?" The question came from Ralph Write, a newly minted reporter.

"I'm glad you asked," I replied. "Simple solutions from simple people would be simply spectacular. But the issues are complex and I don't know if the legislators have the information they need to decide intelligently any of the major questions before them.

"For example," I expounded, as Ralph took more notes than were warranted by my remarks, "there is the issue of local government autonomy. Can the General Assembly stop playing the role of parent to local governments? Why does Indianapolis have to crawl to the Legislature to consolidate its numerous fire departments? Why must efforts to rationalize local government activities be managed by the Legislature rather than the localities themselves?"

"Why?" Ralph asked.

"Power, and the misplaced belief that localities are not to be trusted, that the Legislature is more wise and more responsible than local governments," I answered. "The megalomaniacs at the Statehouse believe they have a monopoly on virtue and good judgment. Hence, they impose taxes on localities for state responsibilities and prevent local governments from reorganizing their activities."

"What are you talking about?" Ralph asked.

"For one, city-county consolidations. Why do we have cities and towns as separate governments in the 21st century? It may have made sense in the 18th century, when the nation was founded, but today we might do well to merge all governments in a single county into one government. The idea that urban areas are sufficiently different from rural areas is an obsolete fiction. Ninety-two local governments would be plenty for Indiana. And then, we could even consider reducing the number of counties we have.

"One benefit of this is we might get better county governments when the people who live in cities and towns feel they have a real stake in county affairs.

"Another case is changing the funding of child welfare services. These services need to be removed from local propertytax funding and paid for from our state's funding sources. Then local governments must be given more money to do their jobs. The best way to do this is to raise the sales and motor fuel taxes and return the increased revenue to the counties in which they were collected."

"Isn't this a radical agenda?" Ralph asked.

"No," I insisted. "We need to change how we think about government and its activities. It is no more radical than the governor's Houdini plan for funding highways."

"Houdini plan?" Ralph said.

"Yes," I responded. "It seems to me that the governor sees the state as bound by the chains of narrow and inflexible thinking. So he tries to do some 'magic' to get out of those shackles by proposing to lease the Indiana Toll Road to a private party and use those funds for improving highways statewide. I'm not convinced it is the best solution, but it does get us to think in a new way about the problem of funding our miserable roads and bridges.

"We require fresh thinking to escape our self-imposed limitations. Indiana needs to protect its local airports from the incursions of housing and other non-compatible developments. Instead of closing Metropolitan Airport in Hamilton County, we need to recognize it as a vital economic development asset.

"We should think about careers that are not high-tech but pay well, such as driving trucks, where there is a major national shortage of drivers. I'll bet, Ralph, that most truck drivers make more money than you do as a journalist."

"I'll give that some serious thought," he said. "I might get to meet a more interesting set of people than I do now."



Marcus taught economics more than 30 years at Indiana University and is the former director of IU's Business Research Center. His column appears weekly. To comment on this column, go to IBJ Forum at www.ibj.comor send e-mail to mortonjmarcus@yahoo.com.
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