How states can get what they need from a frozen Congress: Ignore it

December 16, 2013

(EPA/Michael Reynolds)

It may not be the least-productive Congress in recent memory, but it certainly seems to be up there. And not only is Congress getting little done, but little of what it does do is filtering to states. Budget cuts and plans have set federal aid on a steep, downward path. And that means it’s getting harder and harder to secure funds for big projects aimed at improving the economy.

“[T]he federal government has already committed to significant spending cuts and more seem likely,” members of the Executive Committee on the 10-Year Plan for Oregon wrote in a report to Gov. John Kitzhaber (D) last year. “The risk to the state budget resulting from federal cuts is arguably as high and as uncertain as it has ever been.”

Infrastructure, education and research and development all require big investments and federal funding, for each is projected to fall to its lowest level in years. So what’s a state that’s looking to mitigate and build on its recovery to do? Well, forget Congress, and make the case directly to voters.

“As leaders in states and metropolitan areas formulate new post-recession economic development strategies, they would do well to explore how initiatives and referendums have been used in the recent past to fund public investment in economic growth,” three researchers at the Brookings Institution write in a new paper. In other words, use the ballot box.

It’s not exactly a new idea. The use of initiatives and referendums has been on the rise for decades, as Brookings points out in the charts reproduced below. In some cases, it’s been a vehicle to pursue issue reforms, such as legalizing marijuana or same-sex marriage. But it can also be an instrument of  economic policy.

“People need to really think of it as a tool for this, and I don’t think they necessarily have been,” says Jessica Lee, one of the report’s authors.

Three issues have been shown to resonate with voters at the ballot box, Lee and her fellow researchers argue. Support is strong for three kinds of investments in particular:

  • Innovation. In 2004, California voters approved a $3 billion investment in stem-cell research, and last year they approved funds to boost the clean-energy economy. Ohioans twice approved bonds to fund a state initiative that supports technology-based economic development.
  • Education. New Jersey voters last year approved a $750 million bond to raise money to improve the state’s post-secondary schools, and North Carolinians approved a similar, but much larger, $3.1 billion investment in 2000.
  • Infrastructure. Spending on roads, rail and other forms of infrastructure faces particularly dire challenges, with the federal government reluctant to increase funding and traditional sources of revenue, such as the gas tax, dwindling due to shifts out of the hands of policymakers. But voters seem to get it. In 2008, Californians approved a $10 billion bond issue to build a high-speed rail system between San Francisco and Los Angeles. Georgia’s lawmakers last year asked voters to approve a 10-year, 1 cent sales-tax hike to fund a set of transportation projects.

Putting policy changes to voters may not be for everyone, or suitable for every kind of policy, but it’s one option for lawmakers frustrated by a dysfunctional and glacial Congress.

Niraj Chokshi reports for GovBeat, The Post's state and local policy blog.
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Niraj Chokshi | December 14, 2013