Take our current economic crisis. The federal government is the most logical body to lead us through this crisis. However, state and local governments can also lead.
This is a time for state and local governments to accelerate their capital programs. They can stimulate job preservation and creation as well as the federal government.
My own state of North Carolina has experienced bids for projects coming in 20% under projections because of contractors seeking work.
My home County of Wake has experienced lower interest rates because of over-subscription of their debt issuance.
Oil prices mean costs of road materials are lower than they have been for ages.
These are favorable conditions for undertaking capital projects at this time. The present cost is low, usually about 5 percent in the current budget for total project cost.
We all want tax relief. In order to minimize costs many state and local governments will postpone capital projects. By doing so they will dilute the impact of the federal stimulus effort. The stimulus program would then become a funding replacement program. State and local governments would be like recalcitrant employees who resist change.
We need to look at what each of us can do to stimulate the economy and what is in our longer term interests. We can defer projects and leave ourselves further behind the 8-ball both in terms of our current economic situation and in terms or our longer term competitiveness. Or we can take the opportunity we confront at this time and lead in the recovery from the current situation.
How are governments in your area responding to the financial crisis?