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For the last several months, Ward 2 Councilmember Jack Evans has been running around the city, waving graphs that show the city’s historical fiscal surplus turning into a deficit. Yesterday, while the Council was debating whether to raise taxes or cut more services—they opted for the latter—Evans read off headlines from the 1990s, to illustrate how then-Mayor Marion Barry‘s refusal to rein in spending had finally prompted the feds to take control of the District’s finances. Councilmember Kwame Brown also jumped on the Control Board bandwagon, warning everyone watching that if the Council didn’t make tough decisions, Congress would step in and “make them for us.”
Evans’ rhetoric spawned one of the best Twitter hashtags to come out of a marathon budget hearing ever. And it made me wonder: Is he totally full of shit?
Well, he’s at least being hyperbolic. Brookings scholar Alice Rivlin, former head of the Control Board and current member of Vince Gray‘s transition team, says there are quite a few differences between 1995 and 2010.
“I think all cities at the moment are in some serious financial straits because of the recession. D.C. is no exception,” she began. “However, it’s nothing like the ’90s. The city is in much stronger shape than it was in the worst year, which was 1995. The population has grown, there’s been a lot of economic development, the tax base is stronger than it was then. We have now a 12-year history of balanced budgets. And we built up a substantial balance in the general fund. So I don’t think the city is in any danger of the return of a control board. Unless we do something extremely stupid, and I do not think the new mayor and the new council will do that.”
Plus, District government itself is nothing like it was 15 years ago, especially in terms of its reputation on the Hill.
“The Congress in the 90s had very little confidence in the city, and was doing a lot of meddling with the D.C. budget making process,” Rivlin said. “And that’s been much less true, in part because of the succession of mayors. [Former Mayor Anthony] Williams and Fenty have established good relationships on the Hill. And the other difference is the existence of a Chief Financial Officer. We didn’t have that in 1995. That was a creation of the legislation to put the control board in place, and it was a good one.”
How did the Council do on closing the budget gap this time around?
“It’s a pretty good compromise, because they had to do something by the end of the year,” Rivlin says. “Next year, they’re going to have to close an even bigger gap. And then I think some tax increases will have to be seriously considered.”
She declined to pontificate on what types of taxes would be appropriate. But if we raised them, it’s fair to say that the our Congressional overlords wouldn’t try to step in and take over.