How Will We Govern?

This column originally appeared at Big Jolly Politics.

For our April meeting our Clear Lake Area Republicans club hosted a discussion with County Judge Ed Emmett and County Commissioner for Precinct 2, Jack Morman. I think everyone who attended enjoyed the opportunity to hear both men give a lot of detail about the “nuts and bolts” of what their jobs involve, and hear them discuss the future issues facing the county and Precinct 2. One of the most interesting and memorable points was made by Judge Emmett toward the end of the evening when he challenged Republicans over the next few years to transition from campaigning to governing. His point was that the best and most long-lasting political gains will be made if we can show the voters we can manage local government well.

I totally agree.

In fact, Judge Emmett’s point goes to the heart of one of the central points I’ve been trying to make over the last few years to any local Republican who would listen. That is, if our theories of limited government and federalism are to be re-invigorated at the national and state levels, it will require us to re-commit ourselves to actively engage in the local governance of our schools and communities. If we Republicans truly believe that power should be returned to the individual from Washington and Austin, we will need to exercise the responsibility that comes with that power properly and wisely.

But, in accepting that responsibility, we will have to confront a very sober reality. If we succeed in Washington and our state capitols, we have a daunting task in front of us, because, while we’ve been focused on politics hundreds and thousands of miles from home, the management of many local governments and school districts across the country has disintegrated into a fiscal and operational mess.

We need look no further than the City of Houston to see the problems we face. Given the long-term obligations of the City, it is structurally insolvent. One reason city politicians and leaders fought so hard to keep Red Light Cameras and to pass the Rain Tax, was to raise revenue to keep the City afloat. Does anyone who has now received their tax assessments for the Rain Tax (either directly, or indirectly through entities like the Clear Lake Water Authority) still think this was designed to address the City’s infrastructure needs? My guess is that the only future infrastructure projects we will see over the next 20 years will still be funded the old-fashioned way—through the issuance of bonds. To the extent the new tax revenue will make the issuance of bonds easier for investors and credit-rating agencies to accept, the new tax will indirectly help finance those projects—but only indirectly. Its direct impact will be to momentarily keep the City out of bankruptcy court.

And the City of Houston is not alone in this regard. Incorporated cities, towns and villages all across the country are facing budget crises due to long-term pension, bond, and other contractual obligations. Even Harris County, which has been well-managed over the last two decades, holds a long-term bond debt in excess of $3.4 billion and is facing responsibility for debt incurred by the Sports Authority.

However, our school districts may be facing the most dire problems—both fiscally and structurally. Though I applaud our state legislators for holding the line on the state’s budget by not caving-in to the those clamoring for more money for the schools, there will be a “morning after” for our state’s public education system that will be real and that we will have to address. As Joel Klein, the former head of New York City’s schools under Mayors Giuliani and Bloomberg, recently noted in an article he wrote for The Atlantic Monthly, entitled The Failure of American Schools: Scenes from the Class Struggle, our school systems across the country need to be restructured from the classroom up.

One the biggest impediments to accomplishing this task is not money; it is the political status quo that is maintained by an alliance between local politicians, school administrators, and labor unions, which dictates how the money is spent. This status quo can be seen even in our local school districts. Take my school district, Clear Creek Independent School District. According to data compiled by Americans For Prosperity, CCISD currently has a staff-to-teacher ratio of 1 to 1, and administrators currently make, on average, twice as much in salary as classroom teachers. Less than half of the operational budget is dedicated to the costs of classroom instruction. To fund all of this, the district has issued bond debt in excess of $1.077 billion. This increase in administrative positions and salaries is noted as one of the great impediments to structurally improving education by Klein, who lays much of the fault for these problems on the political clout of the teacher’s unions. In fact, Klein cites the late Albert Shanker, who was the long-time head of the United Federation of Teachers, as once declaring,

When schoolchildren start paying union dues, that’s when I’ll start representing the interests of schoolchildren.

Even Shanker had his candid moments of reflection, though, about the consequences of this irresponsibility. Klein also quotes Shanker as revealing the following during a speech to the 1993 Pew Forum on Education Reform:

The key is that unless there is accountability, we will never get the right system. As long as there are no consequences if kids or adults don’t perform, as long as the discussion is not about education and student outcomes, then we’re playing games as to who has the power.

…

We are at the point that the auto industry was at a few years ago. They could see they were losing market share every year and still not believe that it really had anything to do with the quality of the product … I think we will get—and deserve—the end of public education through some sort of privatization scheme if we don’t behave differently. Unfortunately, very few people really believe that yet. They talk about it, and they don’t like it, but they’re not ready to change and stop doing the things that brought us to this point.

Meanwhile, many urban schools and school districts are experiencing phenomenal drop-out rates. The Detroit school system may be the worst, with an astonishing 75% drop-out rate by the 12th grade; though even some of our schools in the City of Houston have drop-out rates over 50% by the 12th grade. We can not continue to reward administrators and teachers when the product—educated students—is failing. We can not continue with the same classroom model that is failing so many of our students, just as we can not continue with the same model of local governance that is driving so many cities toward insolvency.

In this context, some cities and states have taken drastic measures. Starting in the 1990s, cities such as New York, Chicago and the District of Columbia granted their mayors sweeping authority to run local schools and implement structural changes. More recently, while the actions in Wisconsin, Indiana, Ohio and New Jersey by Republican Governors and legislators have filled all of the headlines, the most drastic actions in the nation have been taken by the new Republican Governor and legislature in Michigan. In February of this year, newly-elected Governor Snyder proposed, and on March 16th the legislature passed, sweeping emergency powers to restructure local governments and school districts (see : this example; and, this example).

To give you a glimpse of the sweeping power that Michigan has granted its governor, look at Section 141.1515(4) of the Local Government and School District Fiscal Accountability Act:

(4) Upon the confirmation of a finding of a financial emergency, the governor shall declare the local government in receivership and shall appoint an emergency manager to act for and in the place and stead of the governing body and the office of chief administrative officer of the local government. The emergency manager shall have broad powers in receivership to rectify the financial emergency and to assure the fiscal accountability of the local government and the local government's capacity to provide or cause to be provided necessary governmental services essential to the public health, safety, and welfare. Upon the declaration of receivership and during the pendency of receivership, the governing body and the chief administrative officer of the local government may not exercise any of the powers of those offices except as may be specifically authorized in writing by the emergency manager and are subject to any conditions required by the emergency manager.

What this provision provides is that the appointed fiscal manager may exercise the following powers:

* the authority to dismiss all or any of the elected officials of the governmental unit or school board;

* the authority to privatize all or any city services and schools;

* the authority to cancel any and all contracts entered in to by the city or school district, including collective bargaining contracts and pension agreements;

* the authority to dis-incorporate a town or city; and

* the authority to merge school districts.

In essence, Michigan has provided its Governor with the power to put its local government through a bankruptcy-like process to restructure it and make it solvent going forward.

Now, I think it is fair to say that most Texans reading this would be aghast at the power that a Republican legislature granted a Republican Governor; but I think most of us don’t appreciate how dire the circumstances have gotten throughout the Midwest, and especially in Michigan. Luckily, circumstances are not that dire here, so we have time to learn from what is happening and to make our needed changes without such laws.

To avoid that type of future, let’s use the next two years between legislative sessions in Austin to begin the hard work of addressing the fiscal and structural problems facing local governments and school districts in Texas, with the goals being

* to return as much responsibility to local governments and school boards as is administratively possible, and

* to re-structure those governmental units so that they will be fiscally capable of wisely exercising that responsibility.

To accomplish these goals, let’s bring together the leaders of our school districts, our cities and our counties; the leadership in Austin; leaders of our business and non-profit communities; and our grassroots activists throughout the state to form task forces to address the issues facing localities, such as

* re-structuring our schools to provide a 21st Century model of classroom education, and a system to pay for it;

* re-structuring our health and mental-health systems to provide proper and affordable public care as locally as is economically and administratively feasible;

* re-structuring our city and county governments, especially in our largest counties, to provide more effective fiscal and operational management; and

* re-structuring how we provide for our infrastructure needs throughout the state.

If we make the right preparations now, and our Republicans in Washington accomplish what we sent them to do, then we will be ready to re-assert responsibility for our local communities and schools, and to govern our communities wisely.