Tuesday, January 05, 2016

Houston Area Leadership Vacuum: How to raise taxes of those you love.

Houston now has a new Mayor, Sylvester Turner, a man whose already demonstrating a penchant for selfies and long-winded speeches.

Turner calls for shared sacrifice in battling city's woes. Mike Morris, HoustonChronicle.com ($$$)

"I ask everyone to be prepared to sacrifice for the greater good of the city," he said. "All of us need to come to the table prepared to give to make sure that this city is on a course of financial stability. You just can't be territorial, you just can't say, 'This is mine, don't touch me.' "

Roughly translated this means: "I'm going to move to raise the hell out of taxes preferably for those who don't support me and whose vote I'm not counting on for re-election but for those I am as well."

Of course, tax increases of this type always have collateral damage among supporters so you throw in some clap-trap about shared sacrifice and other nonsense. By "shared sacrifice" he doesn't mean the elected officials and their staffs, or any of the higher ranking officers in City Government. Those are going to be viewed as critical to getting Houston out of this mess. The sharing in the shared sacrifice is going to come from home-owners, apartment renters and businesses within the city limits of Houston.  As I see it Turner is only going to have one option to raise revenues, he's going to have to push to remove the voter-imposed, pillow-soft, revenue cap at the first possible opportunity.

Oh sure, there will be small, ancillary cuts around the edges of the city budget in the short-term. Services will be pared back, budgets slightly restricted etc. These are the types of things that must happen since there is a wait, until 2017, mandated in Texas law about cities and charter amendments. But all of this is just going to be a diversionary tactic in a two-year PR program against the cap.

After sequestration, at the Federal level, we got a preview of what Turner is going to do here. When Obama made the cuts to the federal government he made them in ways that caused the public the most pain, and which were calculated to provide the appearance of pain, all while ensuring the important business of donor service was kept intact. So National Parks and monuments were shuttered, constituent services took a beating. Anything and everything to shift the burden of sequestration away from the government and on to the private sector.

Expect a repeat of this in Houston. I'm sure that the library system will be the first to feel an impact. This is a rather benign cut that gives the media a case of the vapors and results in many angry community groups. Eventually, when the weather improves, Houston can find additional savings by not mowing medians or public areas, resulting in blight and "potential dangers" to youths. A good thing to do would be to shut-down after school programs, that would generate some outrage.

The point is that, whatever the City cuts back on, cuts will be done with the idea that the voting public should suffer the brunt of the burden. Also, despite the fact that public safety expenditures are exempted from the cap, an increase in the size of the police force is going to be tied to the caps removal. The argument will be that, because the cap limits full funding of other areas, monies for police expenditures cannot be fully realized. Expect the municipal unions to fall behind this proposal 100% as they understand that they are TheMachine that is getting fed.

The real trick, for Turner, is going to be his ability to sell these tax increases to his, predominantly poor, voting base. For that, he's going to have to make the pain of the cutbacks be disproportionately felt in the areas where they live. Call it tough love.

That kind of tough love that usually works and that's something  that shouldn't be overlooked. At this point I'd say Turner has a better than average chance of convincing enough low-information voters in Houston that the removal of the cap is mandatory to their happiness that we'll see the measure pass by a narrow margin. He's going to have to work to do it, but he'll have the full apparatus of City Government at his disposal to do so.

At this point I'd recommend holding on for dear life. 2016 could be a year of turbulent skies.