…because I’m an economist and a mom–that’s why!

Steven Pearlstein Points to Central Park as a Public Success Story

August 20th, 2008 . by economistmom

Today’s Washington Post has an excellent column by Steven Pearlstein, inspired by his recent trip to NYC where he was impressed by the condition of the now-privately-financed-and-managed Central Park. 

He finds important lessons for economic policy in Central Park’s success (my emphasis added):

The first is a reminder of the importance of creating and sustaining public facilities that are accessible to everyone and nourish a sense of community. Over the past 20 years, the tendency has been for those who can to abandon public schools, public transportation, public recreation, with the result that American society has become increasingly segregated by class and polarized by political ideology…

The second big lesson is that investment in public infrastructure can have big payoffs

That doesn’t mean that all spending on public purposes can be characterized as investment (an old liberal trick) or that all investments can be expected to have the same payback as Central Park. But it does put the lie to the idea that Americans no longer have the money to build and maintain the quality schools, libraries, parks, roads and public transportation systems required for an advanced economy. Collectively, we have the money. What we haven’t had is the political will to raise the taxes necessary to make these high-payoff public investments.

Conservatives and Republicans see in the Central Park success story further confirmation of their belief that government is inept. After all, it took a private organization, relying primarily on private donations, to turn things around. Liberal Democrats would no doubt reply that if New Yorkers hadn’t been scared away by tax-cutting ideology and had been willing to raise and spend $350 million of public funds for Central Park, the city’s parks department could have accomplished the same feat.

There’s something to both arguments.

Because of the power of special-interest groups and public employees, government spending priorities are too often misplaced and too many government agencies fail to use the money they have to deliver quality, efficient service. That’s why outsourcing has become so prevalent, why charter schools have become so popular, and why so many state and local officials are turning to public-private partnerships and social entrepreneurs to tackle some of their toughest challenges. What Democrats in Washington have yet to realize is that this isn’t about rejecting government or shrinking it — it’s about redefining it.

At the same time, it’s important to remember that in terms of economic impact there isn’t a big difference between a nonprofit raising $350 million in private donations to fix up Central Park or city government raising $350 million through a well-designed tax system to accomplish the same purpose… The idea that every dollar collected in taxes is a dollar lost from the economy is nothing but political propaganda.

the candidates most likely to prevail this fall will be those who figure out how to tap into the yearning to tackle and solve a big problem, to restore pride in the public realm and to reaffirm that sense that we’re all in this together.

Steven is making the important point that just because Central Park is a success story in “privatization” to some extent, doesn’t negate the fact that it’s a much larger testament to our society’s desire to continue to benefit from such inherently public projects.  And realizing how much we value such public goods is the start to being willing to pay for them.

2 Responses to “Steven Pearlstein Points to Central Park as a Public Success Story”

  1. comment number 1 by: Kaleberg

    Another New York institution to consider is the business improvement district. A group of businesses in an area can set up a BID, tax all businesses in the area and provide a variety of services in addition to those provided by the city. For example, the BID may provide regular trash collection, a security patrol, Christmas lights, marketing and the like.

    People will pay taxes if they have a sense of control over where the money is going. Consider New Jersey’s ridiculously expensive town based educational system. Mind you, BIDs aren’t all good. In Port Angeles, where I live, the local BID drove out the Farmers’ Market because it brought too many people downtown on Saturday mornings when the town was otherwise deserted.

    Anti-tax people believe that the way to get rich is to sell stuff to people richer than you are. Taking anything away from those richer makes you poorer. Pro-tax people believe it is easier to get rich selling to people who have less. Taking away from those richer and giving to those poorer makes you richer. Only the latter is true, but it is not a very popular idea these days when we have political candidates who think that someone making only a million dollars a year is not rich.

  2. comment number 2 by: Jim Glass

    Another New York institution to consider is the business improvement district. A group of businesses in an area can set up a BID, tax all businesses in the area and provide a variety of services in addition to those provided by the city. For example, the BID may provide regular trash collection, a security patrol

    Yes, but we cynical NYCers are sometimes prone to wonder: Why, when we are paying the highest taxes in the nation, do we have to pay for our own trash collection and private police on top of it all? Why is this lauded as an “innovation”?

    If this frees the politicians to spend our nation-highest taxes on the priorities that they rank as being more important than trash collection and public safety, what are they? What is the real purpose of the government they run and we pay for these days?

    IOW, the govenment improving the effectiveness of how tax money is spent while giving taxpayers more input into how it is spent — such as the way that Sweden has put in a 100% voucher system for its public schools, and has contracted out its transit systems to private operators — is one thing.

    But it is entirely another thing for the politicians to tell the citizenry: “You want more say in the quality of basic services, and the methods of providing them? Sure! Just pay for them yourselves on top of all the taxes you are already paying, subject to the rules we set. Don’t forget, there has to be something in what you do (and pay for) for yourselves for us too…”

    The BIDs here in NYC, being politically created and authorized entities, are themselves very political creatures.