When Mayor Walter Washington, Councilmember Marion Barry, and the 12 other members of the D.C. Council took their oaths of office on Jan. 2, 1975, their inauguration sealed the final victory in the battle for D.C. home rule. The new elected government ended the reign of the presidentially appointed commissioners who had administered the city since 1874. Washingtonians rejoiced in the liberation of America’s last colony, and anticipated a brilliant future for their metropolis as a black-controlled, black-majority city.
On Jan. 2, 1995, 20 years to the day after the District first celebrated its freedom, Marion Barry again takes an oath of office, this time to begin his fourth term as mayor. But on this inauguration day, home rule’s dazzling promise lies in ruins.
Barry and other D.C. leaders have driven the city government to the brink of financial collapse. The city, facing a half-a-billion-dollar shortfall this year, may run out of money before Barry finishes the first month back in his old office. The bloated, mismanaged District government is delivering awful basic services to citizens. Judges, citing incompetence of barbaric proportions, have already placed two city departments in receivership, and are threatening to seize control of others. And the new Republican Congress, disgusted by Barry’s triumph and the D.C. government’s profligacy, is vowing to reverse years of Democratic indulgence toward the city.
Confronted with disaster, D.C.’s elected officials have—at long last—been seized by a sense of urgency. The D.C. Council is debating cuts in essential services—no rat patrols, fewer cops, fewer recreation programs for kids—in hopes of averting congressional intervention. In an effort to calm Wall Street investors, Barry introduced his own deficit-reduction package on Dec. 8, proposing to narrow the deficit by nearly $400 million.
But the promises of emergency repairs appear to be too little, too late. Incoming Republican leaders are hinting that democracy—in the form of D.C.’s elected officials—has failed the city. They warn that unless District leaders engineer a miraculous revival—and fast—Congress may abolish self-government, fire Barry and the council, and return D.C. to federal dictatorship.
“We could revoke home rule and go to some kind of board to run the city,” says Rep. James Walsh, the New York Republican who will chair the D.C. Subcommittee on Appropriations. “That is not the first option, but we could do it.”
The District may be heading back to the future.
If you want to see one possible future of Washington, D.C., fly to Boston, grab a taxi at the airport, cruise north across the Chelsea River, and stop at the large brick building at the intersection of Broadway and Washington Streets. That structure is the city hall of Chelsea, Mass., and for the last three years, officials inside it have been conducting an experiment in government that should horrify and intrigue Washingtonians. In 1991, the Massachusetts legislature abolished Chelsea’s elected government. A state-appointed trustee has ruled the city ever since, and, strangely enough, Chelseans seem to like it.
At first glance—even at second glance and third glance—Chelsea doesn’t look like a place that can teach the nation’s capital anything. Of all the grimy, poor, industrial suburbs of Boston, Chelsea has long ranked as the grimiest and poorest. A 1.8-square-mile peninsula, the city squats just north of Charlestown and East Boston. The Island End River, Mystic River, Chelsea River, and Mill Creek—each more oily and polluted than the next—flank Chelsea on three sides. The Tobin Bridge, a massive elevated highway, slices the city in two and casts a pall on much of downtown. Tank farms, parking garages, and other industrial grunge sloughed off by Boston cram the Chelsea waterfront.
Since the mid-19th century, successive waves of immigrants—Irish, Poles, Italians, and Jews—have flooded the city, then fled as soon as they could afford to. (Louis B. Mayer launched his Hollywood career with a fortune earned in the Chelsea rag trade. Quasi-luminaries such as Barbara Stanwyck and Chick Corea also spent their childhoods in Chelsea, then left, and never, ever looked back.) Hispanics are the latest group to settle in Chelsea. About a third of the city’s 30,000 official residents are Latino, and another 5,000-10,000 undocumented Hispanics crowd the city’s low-slung apartment buildings and wooden houses. Whites, most of them lower-middle-class, constitute about 60 percent of the official population, while Vietnamese and other Asians comprise the remaining 5 to 10 percent.
Chelsea has earned a statewide reputation as a lousy place to visit and a miserable place to live. One Boston newspaper columnist calls it “Bosnia on the Mystic,” with good reason. Its official unemployment rate runs 50 percent higher than the state average (unofficially, unemployment approaches 20 percent, triple the state average). Chelseans earn 45 percent less than other Massachusetts residents, and a quarter of the city’s population lives below the federally defined poverty line. In the early ’90s, the police made more arrests per capita in Chelsea than in any other city in the state, but barely nicked its thriving business in prostitution, drug dealing, and gambling. (Residents can always drown their town’s sorrows in drink: Chelsea issues more liquor licenses per capita than any Massachusetts municipality.)
But Chelsea shares one critical piece of common ground with D.C. Like Washington, the New England city has long suffered under a spendthrift and inept government. Meetings of the board of aldermen and the school committee degenerated into invective and name-calling. (One politician called a colleague a “trollop.”) The mayors dispensed patronage and fattened their own wallets with “gifts” from Chelsea vice boss Sammy Berkowitz and his associates. Of the four city executives elected during the ’80s, two served time in federal prison for lying to grand juries about taking bribes. Another spent six months under house arrest, and admitted on 60 Minutes to taking payoffs from developers. The fourth avoided jail by cooperating with investigators. (The grim state of affairs turned the city into a laughingstock: “Q: What do you get when you cross a corrupt politician with a corrupt lawyer? A: Chelsea Clinton.”)
“We kept electing people who were stupider and stupider,” says Nadine Mironchuk, a Chelsea native and current city employee, of the old regime. “It was Morons “R’ Us at city hall.”
The rank-and-file followed the lead of the city’s bosses, miring the government in corruption and incompetence. Cops on the take played the numbers in Berkowitz’s gambling dens. The treasurer misplaced thousands of dollars and regularly failed to collect taxes and fees. Garbage haulers allowed trash to accumulate in alleys, and clerks in city hall were loathed for their surly unhelpfulness.
Chelsea’s elected officials misgoverned their city into the poorhouse. Despite taking millions of dollars in state aid each year, the city could not balance its budget. It squandered a $5-million state bailout in 1986, and in 1991 found itself facing a $10-million deficit, a quarter of its $40-million expenditures. The government lacked the cash to pay its employees, threatening the city with a breakdown of public safety and sanitation. In addition, former Mayor James Mitchell, considered the most corrupt of Chelsea’s corrupt chief executives, was running to unseat Mayor John Brennan, the least corrupt.
“The city was going downhill fast,” says Helen Holland, a lifelong Chelsean. “The mayors were taking all the money. The streets were a mess. There was prostitution and drugs. It was a sin.”
State officials decided enough was enough. In the summer of 1991, a blue ribbon committee appointed by Republican Gov. William Weld analyzed the city’s finances and came to a devastating conclusion: Democracy had failed Chelsea. Its dirty, dumb politicians would never fix the budget or restore decent services.
This crisis of politics, the state officials said, demanded a suprapolitical remedy, a savior to slash the Gordian knot of Chelsea government. So in September 1991, the state legislature enacted a bill unprecedented in modern American history. It imposed receivership on Chelsea. Massachusetts borrowed the principle from corporate and personal bankruptcy law, in which courts appoint receivers to control the affairs of debtors who cannot pay their bills.
A state rescuing a city is nothing new. The last two decades have witnessed a dozen major bailouts of deficit-ridden municipalities. But, usually, the state assistance preserves at least the appearance of municipal self-government. In the mid-’70s, for example, the state of New York saved New York City when it was on the verge of default. In exchange for a bailout, the state created an Emergency Financial Control Board (EFCB) and gave it final authority over New York City’s budget. The mayor and city council retained their general executive and legislative powers, but the EFCB could order them—and did order them—to fire thousands of city workers, renegotiate union contracts, and cancel millions of dollars in employee benefits. States have appointed similar boards for Philadelphia, Pa.; Bridgeport, Conn.; Scranton, Pa.; and Yonkers, N.Y., when those jurisdictions neared bankruptcy.
But for the Chelsea receivership, the state abandoned even the pretense of local control. Massachusetts, which exercises supreme authority over its cities by virtue of issuing their charters, obliterated Chelsea’s representative government. The law, “Chapter 200,” fired the mayor, made the board of aldermen and the school committee advisory positions, and suspended the city charter. The legislature invested all executive and legislative authority in a single person: the receiver. From Commandant’s Way to Marginal Street, from Parkway Plaza to the Grub ‘n’ Pub to the Polish Falcon’s Nest, this receiver would be master, answering to no citizen but the governor himself.
The law gave the receiver five years to complete his assignment of balancing the budget, cashiering unqualified employees, and, ultimately, re-establishing democracy.
“The receiver had a larger task than just making the trains run on time,” says Harry Spence, the receiver since 1992. “The receiver had to do whatever he could to restore and revitalize the democratic processes that failed.”
Washington, D.C., 1994, bears a frightening resemblance to Chelsea, 1991. The District is reeling from both fiscal and governance crises. And like Chelsea, D.C. can blame only itself for most of the troubles.
During this summer’s mayoral campaign, Barry seduced voters with a vision of an ’80s revival. The Once and Future Mayor promised to attract 10,000 new jobs for District residents, resist budget cutbacks, and build a government that Washingtonians could take pride in. But as anyone who has glanced at a newspaper since Nov. 8 knows all too well, an avalanche of unmanageable deficits, revenue shortfalls, and astonishing waste has crashed down on the city, burying any fantasy that Barry could magically transport the District back to the boom-boom Reagan years.
The post-election elation has subsided, and District officials are now acknowledging a budget catastrophe of mind-boggling proportions. During the campaign, city officials conceded a $140-million deficit in fiscal 1995, a modest gap in the $3.2-billion general fund. Since the primary, estimates of the shortfall have escalated geometrically. D.C. neglected to pay an $18-million Metro subsidy. That boosted the deficiency to $158 million. Council Chair David Clarke examined the books more carefully in early November: He predicted a deficit of about $250 million. A week later, other councilmembers were forecasting a $300 to $350 million gap between revenues and expenditures. In mid-November, the deficit figure leaped to $400 million, then to $450 million.
On Nov. 22, Barry and his transition budget chief Elijah Rogers finished the most comprehensive audit yet. Unless the city acted, they concluded, the District would owe not only the $158 million identified earlier, but also $111 million from overspending by the Department of Human Services, $50 million from overspending by the Department of Corrections, $30 million from overspending by D.C. General Hospital, $21 million from overspending by firefighters and cops, and $33 million from overspending by other city agencies. To add insult to injury, tax revenues have fallen $40 million short of projections, and the city is also suffering from a $100-million cash shortage.
In fiscal 1995 alone, Barry and Rogers estimate, the gap between collections and expenditures may reach $531 million. In other words, if the District annihilates the public-school system and cans the Board of Education’s 11,000 teachers, administrators, and janitors, it will still barely balance the budget.
These calculations have thrown Barry and the D.C. Council into a panic. The legislators have been caucusing feverishly since the election to find a way to keep the city solvent. On Dec. 8, Barry introduced a deficit reduction package that he claimed would slice $431 million from the shortfall. The scheme endorsed $140 million in reductions introduced by Mayor Sharon Pratt Kelly (but not yet enacted by the council), and proposed canceling pay raises, furloughing employees one day a month, reducing medical assistance to the poor by $25 million, carving $32 million from the D.C. Public Schools budget, and removing 50 beds from D.C. General. Even if the council passes every Barry recommendation, and even if every recommendation saves as much as Barry claims it will—two gigantic “if” ‘s—Barry’s scheme will still leave the city $100 million in the red. Actually, it will leave the city a lot more than $100 million in the red: The day after the mayor-elect announced his package, he admitted that double-counting and other fudged numbers artificially inflated the size of the cuts by tens of millions of dollars.
And unless D.C. pols can convince Wall Street of their seriousness about eliminating the deficit, the city will literally run out of money—perhaps before the end of January. Investors are hesitating about whether to buy the $250 million in bonds the District plans to issue in late December, warning that they doubt the city’s ability to pay them back. Republicans in Congress are considering legislation to prevent D.C. from borrowing from the U.S. Treasury, thereby blocking the city’s access to emergency cash. Come Feb. 1, cops, prison guards, teachers, garbage collectors, and firefighters may be demanding checks from a government that can’t pay them, a conflict that could plunge the city into a public-safety, public-health, public-education, and public-everything-else nightmare. The District will delay the cash crisis for several months if Wall Street accepts the $250-million bond issue, but the city might still go broke by the end of fiscal 1995.
If Barry and the council somehow avert disaster this year, the future looks ugly. District revenues are increasing about 1 percent per year. Expenditures are swelling 5 percent per year. On a chart projecting to the next decade, that gap is terrifying. Deficits approach $1 billion per year by the end of the century. “That is Jaws,” says one D.C. Council staffer, pointing to the diverging lines on the chart. “That is the District’s financial crisis in a nutshell. We are right on the edge of losing our viability as a jurisdiction.”
City officials offer countless alibis to explain why the District can’t pay its bills. They whine that the flight of middle-class residents to the suburbs is robbing D.C. of property and sales tax revenue. Poor people are concentrating in the city, forcing D.C. to spend more and more on subsidized health care, welfare, housing vouchers, and emergency assistance. Congress forbids D.C. from taxing commuters, crippling the city’s ability to collect hundreds of millions in potential revenues. The hybrid structure of the District government compels the city to fund its own prisons, hospital, and university, services typically subsidized by counties and states.
All these facts are true, but they are lame excuses. The District generates enormous local tax revenues—more than any city of its size—and also collects a $660-million federal payment. Its mayors and councilmembers have depleted this richness, protecting their own short-term political prospects and ruining the long-term health of the city.
District politicians never resigned themselves to the end of the ’80s boom. During that prosperous decade, Barry harnessed the city’s gushing taxes to build a political machine. City payrolls ballooned, and thousands of new employees thanked the mayor on election day. The Mayor-for-Life and his council allies also tried to spend the city into liberal nirvana. They promised shelter to all the homeless, offered some of the most generous Medicaid benefits in the nation, and expanded social welfare programs boundlessly.
As long as the economy bustled, the Barry machine revved smoothly. But when recession struck in 1989, the District descended into chaos. Tax revenues dived and demand for services leaped. New Mayor Sharon Pratt Kelly (then Dixon) campaigned on reform and retrenchment, but when the time came to RIF employees and attack city unions, she and the council couldn’t pull the trigger.
The administration hid growing deficits rather than cut costs. The city “balanced” the budget for years by forecasting artificially high tax collections and lowballing the costs of Medicaid and other social services. When those cosmetic measures weren’t sufficient—Kelly never was good with makeup—city officials employed every accounting gimmick in the book, and a lot of new ones, to mask the fiscal crisis. Each year, for example, the Kelly administration gave D.C. General Hospital tens of millions of dollars to cover the hospital’s deficits. But the city obscured the expenditures by pretending the funds were “loans” that the hospital would pay back. (Fat chance!)
Kelly snuck a more clever ruse past voters in mid-’93 when she was grappling with a $200-million-plus deficit. The mayor shifted the property tax year: All revenues collected ffrom October-December 1993 were counted in fiscal ’93. Under the previous system, those taxes would have counted toward fiscal ’94. The adjustment generated no actual extra money, but it permitted Kelly—for one year only—to put 15 months of tax revenue on the books. The city reaped a $173-million paper windfall to cover 1993 debts, and Kelly was able to defer budget cuts for another year.
In fiscal 1994, Kelly could claim only 12 months’ worth of property taxes, so she resorted to a cruder ploy to reach a balanced budget. She borrowed $189 million from the pension fund and did not repay it until the beginning of fiscal 1995. Now the mayor and council have exhausted all their tricks, and the city is drowning in its half-billion-dollar ocean of red ink.
The District’s elected officials have not just built a profligate government, they have built a lousy one. Despite the city’s extravagant spending, many city agencies have deteriorated, perhaps beyond repair. District schoolchildren perennially score lower on standardized tests than any students in the country, while critics lambaste the University of the District of Columbia (UDC) and D.C. School of Law for their atrocious academic records. Every Washingtonian can tell a horror story about the rude bureaucrats, endless red tape, and universal ineptitude found in virtually all city agencies.
The government performs so poorly, in fact, that residents are taking the city to court to secure basic services. In recent years, Washingtonians have filed more than two dozen class-action suits alleging malfeasance in city agencies, and they have won virtually every case. Judges have condemned illegal, incompetent, and often cruel behavior by the D.C. government in suits affecting mental health care, juvenile justice, welfare and food stamp administration, and every Department of Corrections facility.
Judges, furious at the city’s refusal to correct the wrongdoing, are now removing entire agencies from the District’s control. Superior Court Judge Steffen Graae ruled that the District had demonstrated gross negligence in public housing by allowing projects to deteriorate, failing to repair thousands of units, and ignoring tenants’ complaints. On Sept. 22, Graae appointed a receiver for the Department of Public and Assisted Housing (DPAH) and stripped the mayor and council of their authority over the agency. The District is appealing the order.
Two weeks later, U.S. District Court Judge Thomas Hogan found similar abuses in the District’s foster care system and placed much of that program in receivership as well. “We believe in democracy and believe elected officials should run the government,” says Arthur Spitzer, legal director for the American Civil Liberties Union of the National Capital Area and a lawyer for the plaintiffs in the foster care case. “But there is a limit to that….The government has a responsibility to live up to its legal obligations.”
Other activists add that it may be only a matter of time before courts seize control of D.C.’s inhumane prisons, shoddy mental health care system, and other agencies. Piece by piece, judges are dismantling the District government in order to save it.
Under receivership, Chelsea, Mass., has recovered what the District has lost: The ability to govern itself.
When the state first ordered the Chelsea takeover, the receivership promised to be a disaster. “The declaration of receivership sounded like a declaration of the community’s failure,” says Receiver Harry Spence. “The people of Chelsea felt ashamed. They were the object of ridicule across the state, and they were angry at the receivership.”
But when residents recovered from their Chelsea Mourning, many welcomed the intervention as the last chance to save their hometown. “Sure, the receiver came in like a dictator,” says Hank Kenna, a former city employee, as he relaxes on a bench outside city hall. “There were no ifs, ands, or buts. And people didn’t like it because their democracy was taken away.
“But what do people do when they have a government that is failing them?” Kenna asks. “Chelsea needed someone to come in and rescue it.”
Gov. Weld tapped James Carlin, a multimillionaire businessman, to be the first receiver, and the state allocated half-a-million dollars a year for him to pay staffers and consultants. Carlin named Spence, the former receiver of the Boston Housing Authority, as his deputy and hired Stephen McGoldrick as his personnel director. None of them lived in Chelsea, knew the city, or were tied to its incestuous city politics. So when they stormed into city hall in September 1991, they wielded their vast powers like men who had nothing to lose. “The receivership gave us the freedom to break through deadlock and act autocratically,” says Spence.
Carlin “encouraged” entrenched bureaucrats—some of whom had been working in city hall for 40 years—to retire. Those who didn’t take the hint were fired, and within eight months the receiver had slashed the city payroll from 390 workers to 240. The receiver raised sewer fees sharply, imposed a $140-a-year trash surcharge on the poverty-stricken community, lowered the $6,000 stipends paid to the board of aldermen, closed a fire station, and eliminated most overtime for firefighters, saving the city half-a-million dollars. He raised inspection fees, collected nearly $1 million in fines from unpaid parking tickets, and persuaded Massport, the government agency that operates the Tobin Bridge, to give the city a one-time $5-million payment for using city land. Carlin balanced the budget, accomplishing in a few months what Chelsea’s elected mayors hadn’t done in years.
Carlin resigned as receiver in August 1992. Spence succeeded him and promoted McGoldrick to chief of staff. Carlin had played bad cop, slashing and burning the city government to solvency. Spence shouldered the more difficult burden of building an efficient government and restoring democracy.
By all accounts, Spence has accomplished both tasks brilliantly. While maintaining a balanced budget, the receiver has consolidated the Byzantine government’s 30-odd departments into 15, and appointed new managers to run them. He hired a popular new police chief and initiated a vigorous affirmative-action program. Pre-receiver, only two city employees spoke Spanish. Spence has recruited seven Latino cops, and 40 percent of the government’s new employees are bilingual. The receiver also chiseled $100 million from the state government’s funds to build four new schools (the Chelsea system has not seen a new building since 1924), and persuaded the state to erect the $70-million Massachusetts Information Technology Center in his domain. The center will process the state’s tax returns and bring 875 full-time and 50 seasonal jobs to the city, some of which residents are expected to fill.
Autocratic government has not transformed Chelsea from urban nightmare to paradise. Drug dealing thrives in several pockets of the city. Broadway is lined with dingy bodegas, crowded liquor stores, and discount furniture marts that have seen better days. Graffiti covers virtually every surface in the center of town, and people throughout the city grumble that it’s not safe to walk downtown at night. (They’re not kidding: As dusk was falling, I took a photograph of Bellingham Square, the old haunts of Chelsea’s pimps and prostitutes. A man sprinted at me, demanded the camera’s film, and muttered threats: “You don’t take a picture of me. No one takes a picture of me.” He retreated only when a cop car rolled by.)
But receivership has snatched the city from disaster and restored it to mediocrity. The trains are running on time, and for Chelsea, that constitutes a miracle.
“What we started to do is provide services that government had never provided, and people said, “Wow,’ ” says Chief of Staff McGoldrick. “Jobs were coming in. Rubbish was being picked up. The streets were looking a little bit nicer. You walked into city hall and you were treated fairly. If you were Hispanic, you walked into city hall and someone spoke your own tongue. People started to like it.”
Those who once objected to the takeover now gush about the receiver. A somewhat unnerving cult of personality has arisen around Spence, or “Harry,” as Chelseans invariably call him. Chelseans speak of Spence as they might of a favorite baby sitter: He rules them, but does it kindly and does it well.
Now, like a municipal Gorbachev, Spence is leading his subjects to democracy and bidding them farewell. He has completed the business assigned by the state. Voters approved a revised city charter this spring. The new Chelsea will be governed by an 11-member city council, a city manager, a seven-member school committee—and no mayor. “Would you want a mayor if you lived in this town?” McGoldrick asks, pointing to a stack of newspaper clips on city hall corruption.
The city elected its first council on Dec. 6. As soon as this legislature hires a city manager, Spence will hand the reins of government back to the people of Chelsea.
This return to representative government constitutes the great unanswered question of the receivership. It’s possible, says Spence, that the interruption crippled Chelsea’s politics. Accustomed to unilateral decision making, citizens may quickly grow frustrated with democracy’s slow and awkward progress. If that occurs, Spence predicts, Chelsea will vote out its goo-goo councilmembers and revert to the splenetic, divisive politics of the past.
But it’s more likely, Spence says optimistically, that the respite from elections killed Chelsea’s old-style politics. Chelseans have discovered lean, efficient government, and they will demand politicians who deliver it. “I have a great hope that the municipal environment has been drastically altered,” Spence says. “These city council elections have shown a range of talent that has never been seen in Chelsea politics.”
“Receivership is antidemocratic in its approach to problems,” he continues. “But, ironically, it may restore the power of democracy by making government work better.”
Let there be no doubt: Congress can demolish self-government for the District and impose a Chelsea-style receivership tomorrow. The courts are killing the District bureaucracy slowly by placing one agency after another into a judicial receivership. Congress could decapitate the entire government with one stroke of the legislative ax.
Under Section 601 of the 1974 District of Columbia Self-Government and Governmental Reorganization Act (the home rule charter), Congress reserves the right to override any provision of local government, and repeal any law affecting the District. So, except for a presidential veto, nothing prevents the Hill from rolling back home rule. The House and Senate could enact a receivership law suspending city government. The president could name a receiver, probably an African-American respected in the community such as National Public Radio PresidentDelano Lewis or George Mason University professor Roger Wilkins. The feds could stipulate a five-to-seven-year term for the new boss to straighten city finances, restructure the government, and rebuild the democratic process. (In theory, Congress could revoke home rule permanently, but not even the District’s most rabid critics have suggested that idea.)
Dictatorship, which dispenses with checks and balances, is one of the cheapest forms of government, and according to Spence’s calculations, the personnel costs of a D.C. receivership would be relatively low. Spence estimates that a receivership for a city of 600,000 would require 15 staffers (paid by Congress), as well as $3 million to spend on consultants. The total expense—perhaps $5 million in the first year—would be dwarfed by the annual federal payment.
No major American city has ever lost representative government, and Chelsea is a piddling suburb with a population one-twelfth the size of D.C.’s, so a description of a District receivership is an exercise in speculation. But, that said, any Washingtonian who has ever registered a car, sent a child through the D.C. public schools, or paid a municipal tax bill can imagine how a receiver could radically improve the District by protecting the city against its own bad government. Independent of the District’s politics, the receiver could slaughter the sacred, useless cows that D.C. leaders are afraid to touch.
The receiver could, for example, break the back of the city bureaucracy. D.C. employs about 45,000 workers. This translates into one employee for every 13 residents, about twice as many as cities of comparable size. But the rule of thumb holds that 45,000 workers equals 90,000 votes on election day, and D.C. pols know that pink slips are political suicide. Mayor Kelly learned this the hard way. She vowed to “shovel” 6,000 employees off the payroll in her first term. Facing implacable employee opposition, she succeeded in trimming only 2,000—almost all through retirements—and it still sent her popularity plummeting. Barry claims he can save $431 million without permanent layoffs, even though everyone knows the District must shed thousands of employees to stay solvent. The receiver could cut at least 10,000 staffers from the payroll, a move that would save taxpayers hundreds of millions of dollars per year.
UDC receives a larger government subsidy per student than any college or university in the country, and fewer than two in 10 students ever earn a degree. But D.C. pols continue to lavish money on the university and its 11,000 students/voters. The receiver could follow the recent recommendation of the Rivlin Commission and shrink UDC into a community college. The city could fund full scholarships for D.C. public-school grads to attend private universities, rid the D.C. government of yet another wasteful administration, and still save $20 million per year.
A receiver could also take a knife to the D.C. School of Law, which has been struggling ever since its creation from the wreckage of Antioch School of Law seven years ago. Like UDC, the School of Law is protected by powerful political allies—Council Chairman Clarke in particular—and like UDC, it has compiled a spotty academic record. The law school takes $5 million in tax money every year to perform a function that D.C.—which already has four other law schools—cannot afford.
D.C. General, the public hospital that consumes more than $80 million in city revenues each year, should be shuttered as well. D.C. possesses a surplus of hospital beds and can’t keep throwing taxes into this money pit. A receiver could save the city millions by closing the facility and paying private hospitals to absorb its needy patients.
These examples constitute just a starting point for reinventing a viable D.C. government. A receiver could also reduce the enormous D.C. Council staff (something the council itself would never do), renegotiate collective bargaining agreements, eliminate dozens of boards and commissions—does D.C. really need its Alzheimer’s Disease Study Commission?—introduce government performance standards that require employees to actually do their jobs, and take dozens of other measures to replace the city’s legendary incompetence with professionalism.
And who knows—a receivership, as long as it isn’t permanent, might even resuscitate D.C.’s comatose politics. The city’s old guard of politicians—Barry and Councilmembers Clarke, Hilda Mason, Harry Thomas, Frank Smith, John Ray, and Charlene Drew Jarvis—have dominated the Wilson Building forever, rehashing the same tired ideas term after term. The city needs youthful vigor, and if Washingtonians won’t elect fresh faces now, perhaps a receivership will force the city to later. A takeover would shelve the incumbents. When Congress returned D.C. to self-government, a new crop of leaders might make Washington forget Barry and his Marionettes.
The District’s leaders don’t want to hear about the death of self-government. Home rule is D.C.’s civic religion, and Washingtonians dismiss as sacrilege the mere suggestion that Congress could suspend democracy. Receivership, after all, constitutes an anathema to every American ideal of government.
“I don’t think Congress will do that,” says Councilmember Evans. “We’re not Chelsea. We are a major city, and having a mayor and a council here is important.”
“I have not heard anyone talking about [a receivership],” says Ward 7 Councilmember Kevin Chavous. “That would be a terrible thing, and I don’t think we are there yet.”
Political Washingtonians recite a litany of reasons why receivership should not happen here. A federal takeover, they say, might inflame racial tensions in D.C. and across the country. Imagine the spectacle of Capitol Police officers hauling kente-clad Marion Barry from the mayor’s office and booting At-Large Councilmember Mason—the “grandmother to the world”—down the steps of the Wilson Building. Imagine white conservatives like Rep. Dana Rohrabacher (R-Calif.) appointing some outsider to sack thousands of city workers, trim welfare payments to ailing seniors, and slam the doors of the D.C. General emergency room. Congress would never risk it.
Besides, some Washingtonians insist, Congress does not care enough about the District to assume day-to-day responsibility for it. The city may serve as the nation’s capital, but it is, as Councilmember Chavous says, “just a blip on the screen” of the Republican leadership, an issue infinitely less important than school prayer or bashing welfare moms. Capitol Hill draws politicians who want to draft national legislation, not supervise pothole repairs on Harvard Street, monitor the turbidity of the Dalecarlia reservoir, and set the tuition at UDC.
The Republicans may choose to ignore District affairs. They have already reduced the House District Committee to a subcommittee. Some GOP House members, including future Speaker Newt Gingrich (R-Ga.), have floated the idea of retroceding D.C. into Maryland and ending Congressional oversight altoghether.
Washingtonians also find solace in a kind of porcupine principle: The city is afflicted by violent crime, miserable poverty, high unemployment, a shrinking tax base, and a deteriorating infrastructure. Congress would be insane to try to run it.
“Nobody wants this baby anyway, that is the only thing we have going for us,” says Donna Brazile, spokeswoman for D.C. Congressional Delegate Eleanor Holmes Norton.
“I think the Republicans would prefer to have the District as a scapegoat rather than have any actual responsibility. They don’t want to govern the District,” says statehood activist and American University law professor Jamin Raskin. “The new Republican Congress would much rather use the District to generate headlines about Democratic corruption and incompetence than try to govern and change things.”
And, according to some Wilson Building insiders, Congress won’t need to consider receivership because, this time, the District is going to make the tough cuts on its own. “The sense of urgency is finally here,” says Councilmember Chavous hopefully. “It is forcing us to work together and to make some real changes.”
While many doubt that the council can hit Barry’s $431-million target, Chavous and others believe that the city can pare at least $250 million from this year’s budget and raise another $50 million in revenues, leaving only a $200-odd-million shortfall. The U.S. Treasury would loan the city several hundred million dollars to erase the remaining deficit. Then, under this rosy scenario, the feds, impressed by D.C.’s belated thriftiness, might preserve the city by agreeing to run Lorton, D.C. General, and UDC. Crisis averted. Home rule saved.
But the council’s vow to make real cuts sounds like the promise of a backsliding alcoholic. Councilmembers have known for six months that the city was rushing toward bankruptcy, and fiscal 1995 is already two months old. Yet the council has still not mustered the courage to make any significant budget cuts. The bickering legislators completed the easy work by raising taxes (again) by $40 million and saving $30 million through employee buyouts. But they have yet to trim appropriations sufficiently, slicing about $150 million from expenditures, a fraction of the necessary reductions.
Staffers admit privately that the council may let the fiscal crisis worsen rather than eliminate popular programs or—God forbid—fire city employees. Ward 5 Councilmember Thomas, for example, has opposed what modest cuts the council has made, saying, “We’re moving backward.” Councilmember Mason refused to support public-school reductions until they were lowered from $33 million to $22 million.
Congress faces a dilemma. The Hill will not reward the District’s profligacy by bailing the city out again. But the feds cannot allow the nation’s capital to descend into anarchy. The Republicans may not want to run a messy city like D.C., but they will not tolerate rats roaming the streets of Capitol Hill and feeding on mounds of uncollected garbage; unpaid cops and firefighters watching idly as burglars steal cars and fires engulf entire blocks; or gangs of kids loitering on corners because schools, libraries, and rec centers have all been closed.
So the feds may conclude that if the District government can’t live within its means, Congress must rule in its place. And rather than being enraged by the possibility of a federal takeover, Washingtonians themselves may be starting to realize that they have forfeited any right to protest. By squandering money and ruining its government, the city has surrendered the right to decide its fate. Just as debtors throw themselves on the mercy of bankruptcy court, so the District must throw itself on the mercy of the Congress.
“The District,” says incoming D.C. Appropriations Subcommittee Chairman Walsh, “is not in a position to pick and choose what it does and doesn’t want Congress to do.”
The GOP, in fact, is already planning a strategy to discipline the city. Last month, Pennsylvania Rep. Joseph McDade, ranking Republican on the House Appropriations Committee, asked the General Accounting Office (GAO) to prepare a study on urban fiscal crises, focusing particularly on the budget disasters of New York and Philadelphia. According to congressional and council staffers, Congress will almost certainly appoint a New York-style financial control board if the city exhausts its cash supply. Such a board, which would be composed of a handful of members of Congress and private-sector Washingtonians, might assume line-item-veto power over the District budget.
And if that board fails to impose austerity on the mayor and council, don’t be surprised if the Congress launches a full-scale assault on home rule. Contrary to the assumption of some Washingtonians, congressional Republicans may actually relish the prospect of running D.C. A receivership would topple Barry (whom most Republicans despise) and create a natural testing ground for GOP ideas about crime fighting and entitlement reform.
And, hard as it may be for Washingtonians to stomach, a temporary congressional takeover might be just the medicine Washington needs. Receivership rescued Chelsea from bungling politicians and bureaucrats. Goodness knows the District could use the same relief.
“We—not just the receiver, but the commonwealth of Massachusetts and the good people of Chelsea who finally got involved in their city—have brought this city back. And that is a good thing,” says Chelsea Chief of Staff McGoldrick. “I don’t think it is a good thing that the receivership needed to be done, but it is a good thing that it happened.”
McGoldrick peers out the window of city hall and gestures expansively toward the shoppers bustling along the sidewalks, toward the clean streets, toward a police officer walking the beat. He breaks into a self-satisfied grin.
“And now Chelsea has a whole new way of operating: new laws, new financial operations, a new charter. It is a municipality for the 21st century,” he continues. “But someone had to come in and do it.”