THE FINANCIAL PLIGHT OF THE AMERICAN CITY

OUTMODED FINANCIAL STRUCTURES SIMPLY DO NOT SEEM TO PROVIDE ENOUGH MONEY TO SOLVE THE SERIOUS SOCIAL, POLITICAL AND ECONOMIC PROBLEMS CONFRONTING URBAN AMERICA. THE BASIC FISCAL DILEMNA FACING MUNICIPAL GOVERNMENT IS HOW TO RECONCILE HIGHLY-ELASTIC EXPENDITURE PROGRAMS WITH INCOME- INELASTIC TAX STRUCTURES. SINCE 1957, COMBINED STATES AND LOCAL SPENDING HAS INCREASED 1 AND 1/2 TIMES AS FAST AS THE NATION'S INCOME AND ALMOST TWICE AS FAST AS FEDERAL EXPENDITURES ON GOODS AND SERVICES. THE GENERAL PROPERTY TAX, A MAJOR SOURCE OF CITY REVENUE, WAS DESCRIBED FORTY YEARS AGO BY AN EMINENT TAX AUTHORITY, AS ONE OF THE WORST TAXES KNOWN IN THE CIVILIZED WORLD, AND ITS RETENTION COULD BE EXPLAINED ONLY THROUGH IGNORANCE AND INERTIA. FEDERAL AID IS DESCRIBED AS A MANAGEMENT MUDDLE OF SOME 200 FEDERAL PROGRAMS ADMINISTERED BY SCORES OF FEDERAL DEPARTMENTS AND AGENCIES, WITH DUPLICATION, OVER-LAPPING, AND FRAGMENTATION. THERE IS ALSO THE INTER-LOCAL FISCAL IMBALANCE OR THE ECONOMIC DISPARITIES BETWEEN THE CENTRAL CITY AND ITS SUBURBAN SATELLITES. IT IS CONCLUDED THAT THE CITIES OF AMERICA MUST MAKE GREATER USE OF A BROAD-BASED INCOME TAX EITHER DIRECTLY BY THEMSELVES OR INDIRECTLY BY THE EXPANSION OF FEDERAL AND STATE AID WHICH ESSENTIALLY SUBSTITUTES FEDERAL AND STATE INCOME TAXES FOR THE LOCALLY LEVIED PROPERTY TAXES.

  • Availability:
  • Supplemental Notes:
    • Vol L, No 4, PP 85-91
  • Authors:
    • Zubrow, R A
  • Publication Date: 1968-4

Media Info

  • Serial:
    • Public Management
    • Publisher: International City/County Management Association
    • ISSN: 0033-3611

Subject/Index Terms

Filing Info

  • Accession Number: 00201365
  • Record Type: Publication
  • Files: TRIS
  • Created Date: May 13 1994 12:00AM