By Steven Pearlstein
Wednesday, August 20, 2008
Atrip to New York City is normally not my idea of how to spend a beautiful weekend in August, but for the fact that it was the last chance to visit with our daughter before she headed off for a year at a marketing consultancy in London. By midafternoon Sunday, we had had about all the culture, concrete and consumption we could take. So we put on running gear and headed to Central Park.
What a treat it turned out to be. I've been in Central Park several times in recent years and knew progress had been made in restoring the luster to Olmstead's jewel since management of the park was handed over to a private conservancy that had become a pet project of the Manhattan plutocracy. On this outing, I was blown away by how well manicured and maintained this enormous and varied public space was -- the lush ball fields, the carefully restored iron and masonry work, the magnificent sculptures and working fountains, the perfectly trimmed trees and bushes. I didn't find a streetlamp, a water fountain or a bathroom not in working order.
What made it all the more remarkable was the number of people using the park that Sunday afternoon, tens of thousands of all ages and backgrounds, riding, lounging, strolling, rowing, jogging, skating, eating, reading, painting, throwing, kicking, swinging, canoodling, talking or listening to live music. Yet despite the crowds, it never felt overcrowded.
There are, it seems to me, important lessons for economic policy in the Central Park success story.
The first is a reminder of the importance of creating and sustaining public facilities that are accessible to everyone and nourish a sense of community. Over the past 20 years, the tendency has been for those who can to abandon public schools, public transportation, public recreation, with the result that American society has become increasingly segregated by class and polarized by political ideology. In Central Park, I found hints that Americans were eager to reverse that trend.
The second big lesson is that investment in public infrastructure can have big payoffs. The Central Park Conservancy calculates that it invested $350 million over the past 20 years to restore the park to its former glory and requires $37 million a year to maintain it. That may sound like a lot of money, but when compared with the enhanced property values in the surrounding neighborhoods, the increased tourism it has helped to spawn and its contribution to making the city a more attractive place to live, my guess is that the return on investment easily equals that of the average hedge fund.
That doesn't mean that all spending on public purposes can be characterized as investment (an old liberal trick) or that all investments can be expected to have the same payback as Central Park. But it does put the lie to the idea that Americans no longer have the money to build and maintain the quality schools, libraries, parks, roads and public transportation systems required for an advanced economy. Collectively, we have the money. What we haven't had is the political will to raise the taxes necessary to make these high-payoff public investments.
Conservatives and Republicans see in the Central Park success story further confirmation of their belief that government is inept. After all, it took a private organization, relying primarily on private donations, to turn things around. Liberal Democrats would no doubt reply that if New Yorkers hadn't been scared away by tax-cutting ideology and had been willing to raise and spend $350 million of public funds for Central Park, the city's parks department could have accomplished the same feat.
There's something to both arguments.
Because of the power of special-interest groups and public employees, government spending priorities are too often misplaced and too many government agencies fail to use the money they have to deliver quality, efficient service. That's why outsourcing has become so prevalent, why charter schools have become so popular, and why so many state and local officials are turning to public-private partnerships and social entrepreneurs to tackle some of their toughest challenges. What Democrats in Washington have yet to realize is that this isn't about rejecting government or shrinking it -- it's about redefining it.
At the same time, it's important to remember that in terms of economic impact there isn't a big difference between a nonprofit raising $350 million in private donations to fix up Central Park or city government raising $350 million through a well-designed tax system to accomplish the same purpose. As we should have learned from the tech and housing bubbles, there is no guarantee that private investment will always be wiser than public, and there are plenty of examples of public managers and workers who perform as well as or better than their counterparts in the private sector. The idea that every dollar collected in taxes is a dollar lost from the economy is nothing but political propaganda.
What struck me most about my visit to Central Park, however, was the old-fashioned pride that New Yorkers take in the their spectacular public amenity -- a pride reflected in how they dressed, the courtesy they showed one another and the instinct to pick up the occasional piece of litter left by someone else. As I left, it struck me that the candidates most likely to prevail this fall will be those who figure out how to tap into the yearning to tackle and solve a big problem, to restore pride in the public realm and to reaffirm that sense that we're all in this together.