The States' Role in U.S. Local Government Fiscal Crises: A Theoretical Model and Results of a National Survey

Abstract

This article hypothesizes four potential roles that states may play in dealing with local government fiscal crises: predict, avert, mitigate and prevent the recurrence of local fiscal crises. Based on a 50‐state telephone survey administered by the author to members of the National Association of State Auditors, Comptrollers and Treasurers in 2002, this article presents detailed information on states' roles in dealing with actual local government fiscal crises. The research found that ten states had formal definitions of local government fiscal crises while the remainder varied between having a working definition, having no definition, or leaving it to local authorities to define a fiscal crisis for themselves. Although the majority of states lacked a rigourous, legal definition of what constitutes a local government fiscal crisis, 36 states reported that they had had such crisis in recent history in their states. Seven overlapping categories of state approaches emerged: the directive approach, the proactive approach, the ad hoc approach, the special legislation approach, the reform approach, the takeover approach, and the responsive approach. States reported a wide range of activities under each of the hypothesized roles. In general, states tended to get involved after a crisis rather than before one occured.     

Reportlng of performance measures for federal agencies: the initial impact of the chief financial officer act of 1990

The Chief Financial Officer Act of 1990 requires the preparation and audit of financial statements for many federal government programs and agencies. The first comprehensive set of financial statements prepared to meet the provisions of the CFO Act were for the fiscal year ended September 30, 1991 and were published in CFO Annual Reports due in August of 1992. This paper presents the results of a study of performance measurement in the fiscal year 1991 financial statements of the sixty-three reporting entities filed as part of the 1992 CFO Annual Reports. The purpose of the analysis of performance measures included in the fiscal year 1991 financial statements was to determine to what extent the financial statements of each of the reporting entities included the various types of performance measures identified in the framework developed for this project. The paper also includes an in-depth analysis of the performance measures reprted by the Social Security Administration and the Department of Labor.     

The Bulgarian connection: Drugs,weapons, and terrorism

Abstract

The Bulgarian government is involved in sub‐version of Western governments, almost certainly orchestrated in Moscow, involving drugs, weapons, and terrorism. Despite U.S. efforts to work with Bulgaria to curb the illicit traffic of drugs and weapons, cooperation has been virtually nil. This has prompted some members of Congress to probe Bulgaria's motives, and on February 26, 1985, Senator Alphonse D'Amato introduced a bill, S. 515, the Bulgarian Interrelation Review Act, directing the President to conduct a comprehensive review of U.S. policy toward Bulgaria. This article analyzes that legislation, the dimension of the drugs and terrorism connection in Bulgaria, and offers further recommendations in dealing with the issue.     

Health care reform content and process:propositions from the states

Health care reform and cost containment have become central campaign and policy issues in the United States. Although focus now centers on federal health care reform policy, state governments have been actively introducing health care reform legislation. Some of the health care reform initiatives on the state level have influenced deliberations on the federal level and President Clinton's health care reform initiatives will spur further state experimentation regardless of legislative success in Congress, In 1992 nearly all 50 states had either legislation introduced, or special task forces assigned that addressed health care reform issues. This exploratory research compares the content and process of health reform in four states that attempted major reform in 1992—Florida, Washington, Michigan, and Wisconsin—and draws propositions for state reform based on comparisons of content and process. The four states chosen represent geographic diversity and a balance between legislation seeking partial change and legislation calling for universal health care reform. The principal reform bills in each state are compared and assessed on the degree to which they address eight reform elements; high tech medicine, administration, tort reform, long-term care, regulation, insurance mandates, small business insurance, and insurance portability. These initiatives are also compared on a series of reform process variables that relate to the political process for adopting reform: degree of health sector support, type of political strategy used, reform champion, degree of cooperation among policy stakeholders, and timing of initiative. Based on these four cases the phased/partial approach seems to have a greater chance for legislative success than immediate universal reform. Florida's partial, consensus-building approach resulted in the only signed bill of the four states. Washington's bill, which also took a partial approach, passed the state senate before ultimate defeat in 1992 and eventual passage in 1993. Neither of the more ambitious universal health care reform packages introduced in Wisconsin or Michigan got out of committee. Although some of the plans were thorough, none adequately addressed the tradeoff between increasing access to care and containing costs. In addition, this study will demonstrate that universal health care legislation, does not necessarily equate to comprehensive health care reform. The propositions derived from this research have implications for future state health care reform efforts, as well as for federal health care reform policy in terms of the substantive content of reform proposals and the political process by which they are advanced.     

Federal politics and market reform in the developing world

Prior research on the politics of market reform in developing nations has generally ignored the significant role of federal political and economic arrangements in shaping adjustment processes. In contrast, this research develops a model of macroeconomic reform that accounts for the significance of subnational economic policy in the developing world’s nine major federations. I examine five hypotheses which are expected to influence the capacity of developing federations to conduct polity consistent with the exigencies of market pressures. With the use of a cross-sectional time-series analysis of fiscal and monetary policies, I show that the policy divergence between levels of government shrinks when provincial governments have greater fiscal power and there are high degrees of party centralization across levels of government. These findings have important implications for the political economy of market reform, the widespread move toward fiscal decentralization, and the design of regional supranational institutions. This research is based on work supported by the National Science Foundation under Grant SBR-9809211. I would like to thank Karen Remmer, Ken Roberts, Wendy Hansen, Alok Bohara, and excellent reviewers for helpful comments.     

Poverty,Ideology and Terrorism: The STAM Bond

This article focuses on the role of ideology in the decision of people who are not from societies’ worst-off socioeconomic groups to join a left-wing terrorist organization. Taking up the sociological perspective of Max Weber, Clifford Geertz, and Raymond Boudon, the author introduces the concept of the “terrorist of the first hour” and considers ideology as a type of social bond. The concept of ideology is here broken down into four dimensions: Social, Temporal, Affective, and Moral (STAM bond). This article also presents data on the ages, sex, educational level, and occupation of the Italian people arrested (2,730) or convicted (528) for crimes of terrorism from 1970 to 2011. Data on Italian terrorists were provided by the General Department of Prisoners of the Ministry of Justice. ¹ 1. The research was conducted between February and July 2011. The author wishes to sincerely thank Sebastiano Ardita—the Director of the General Department of Prisoners of the Ministry of Justice—who gave authorization to collect data on Italian people arrested or convicted of terrorism of which only the Ministry of Justice is in possession. This article considered only data regarding terrorists working to subvert internal order. The articles of the Italian Penal Code regarding “internal” terrorism are articles 270, 270 bis, and 306, and since 2001 further articles have been introduced in order to combat international terrorism.      

Victims Speak: Comparing Child Sexual Abusers' and Child Victims' Accounts, Perceptions, and Interpretations of Sexual Abuse

This article presents findings from a longitudinal study¹ that sought to evaluate a treatment program for child sexual abusers. A triangulated methodological approach was adopted drawing upon quantitative and qualitative methodological techniques. The focus here is upon one element of this research.² Ninety-one in-depth interviews were conducted over a four-year period with a small, nonrandom sample of twenty-one male offenders who had been convicted of sexual offenses against children. All of the men were subject to probation orders with a psychiatric condition (Criminal Justice Act, 1991). One of the aims of this element of the research was to explore the extent to which evidence of denial could be found in offenders' accounts of offense circumstance and also to explore the extent to which offenders minimized the nature and extent of abuse perpetrated. Offenders' accounts of offense circumstances were compared to victim statements, and stark differences emerge. These findings have considerable implications for treatment practice with sex offenders, where victims' perceptions could be used to directly confront offender denial and minimization.     

The anti‐terrorism act of 1987—An update on the controversy surrounding efforts to close down PLO offices in the U.S.

Abstract

The basic intent of Congress in enacting the Anti‐Terrorism Act of 1987 was not to deprive supporters of the Palestinian Liberation Organization of expressing their opinions but to induce the PLO to renounce the use of terrorism. By reaffirming United States abhorrence of terrorism, the supporters of this legislation also hope to encourage the emergence of Palestinian leaders who are dedicated to a peaceful resolution of the Arab‐Israel conflict. While the United States Government and major Jewish organizations have supported the closing of the PLO's Washington‐based Palestine Information Office, there has been considerable questioning in these same circles of the wisdom of the Congressional action to close the PLO's Observer Mission to the United Nations. This action was challenged by the United Nations, and the International Court of Justice asked the United States to resolve this matter through arbitration. The Reagan Administration finally accepted a Federal court ruling that the law did not require closing the U.N. Mission.     

U.S. treasury department studies of federal- state-local fiscal relations: the context,the major themes,and the outcome

This article provides an assessment of the condition of the literature on several major issues of Federal-State-local fiscal relations. The assessment is provided in the context of a three-volume report on Federal-State-local fiscal relations recently published by the U.S. Treasury Department. The author was a major participant in the studies who generally views them favorably, but who also raises his real concerns about a number of matters.

This article summarizes and evaluates certain aspects of the economic theory of federalism, the intellectual underpinnings of the report. This article addresses the institutional context in which the report was written, which helped shape its approach, content, and conclusions. The report itself generally lacks detailed recom-mendations.

Three main themes of the report are addressed in detail in this article. These are: (a) issues relevant to programs of general-purpose fiscal assistance, which include the adequacy of any potential improvements that might be made in measures of the fiscal capacity of State and local governments; (b) the role, if any, for tax subsidies to State and local governments through the deductibility of State and local taxes in the computation of individual Federal income taxes, and the exemption from Federal income taxes of interest paid on bonds and notes issued by State and local governments; and (c) the projection of the long-term outlook for the fiscal condition of the State-local sector on a current services basis, compared with projections of the long term outlook for the Federal government.     

DEVELOPING STATE AUDIT IN BRITAIN

This paper discusses the development of the British state audit system exercised by the Public Accounts Committee (PAC), the Comptroller and Auditor General (CAG) and the National Audit Office (NAO). It briefly describes the concerns which led to a campaign for reforming our audit arrangements and to the passing of the National Audit Act in 1983 and considers ways in which that Act could be used to increase the effectiveness of parliamentary and public accountability of central government in the light of new developments in the management of departments.     

THE INEXORABLE RISE IN THE UK NHS DRUGS BILL: RECENT POLICIES, FUTURE PROSPECTS

The UK National Health Service drugs bill has been the subject of controversy since the inception of the nhs . This article identifies the growth in the drugs bill and explores some of the factors driving the bill upward. The conclusions of this article are: that the drugs bill will continue to remain high on the political agenda; the government has only a limited amount of control on the drugs bill; various policies may counteract rather than complement each other; some of the policies may actually increase the drugs bill; however, many of the effects of the policies are unknown and there has been no rigorous assessment of the effects of any of the policies since 1948; and finally there is no robust evidence to suggest the drugs bill either does or does not represent good value for money.     

Washing Away the Sins of the Past

Abstract

The National Water Act of 1998 is the legislative framework for integrated catchment management in South Africa. It is a progressive legislation that advocates inclusion and aspires to narrow the agp of unequal access to water in South Africa. The legitimacy and representativity of the catchment management agency depends largely on the success of the process leading to its establishment. The dynamic between the creation of trust and the construction of water management institutions is examined. The article highlights the problems that have emerged in the attempt to reform management systems and concludes that water management bodies need to more assertively build trust and reduce shame relations particularly amongst ordinary water users.     

Adjustments in municipal fiscal crises. Are they different according to the gender of the mayor?

The literature on gender has attempted to explain the differences between the public outcome depending on whether the ruler is male or female, on the basis that men and women have different preferences. This scientific research has not yet examined issues related to fiscal crises, and our research aims to fill this gap. In a context of generalised economic crisis, our research examines if the gender of the mayor affected the fiscal adjustment policies carried out by municipalities with fiscal deficits in the Spanish region of Galicia. Our paper suggests that although gender of the mayor does not seem to have affected the level of adjustment in total current expenditure, it does seem to have influenced the way in which social and non-social spending were adjusted. Our study also highlights that female mayors are associated with lower levels of tax revenues and this could slow the adjustment processes of fiscal imbalances.     

The Civil Servant as Legislator: Law Making in British Administration

How are government policy commitments converted into legislation and what happens in the conversion? The role of civil servants in preparing legislation is far more important than is generally assumed. By looking at the work of four recent bill  teams in Britain – teams of civil servants given the task of developing Acts of Parliament – their crucial roles in initiating policies, placing them on the political agenda (even helping secure their place in a party manifesto), developing them, making sure they pass through parliament and enacting them once they have reached the statute books are assessed. The article explores the composition and working methods of bill teams. These teams work with considerable autonomy in developing legislation, but it cannot be assumed that they operate outside ministerial control. Teams see themselves as reflecting the priorities of the government in general and their ministers in particular. Yet ministers typically know relatively little about the law they are bringing in until they receive the submissions and briefings from their officials. Perhaps the biggest danger for democracy is not a civil service putting forward proposals which a minister feels forced to accept, but rather that ministers do not notice or fully appreciate what is being proposed in their name despite having the political authority to change it and a civil service which bends over backwards to consult and accommodate them.     

Financial Discrepancies in Political Party Funding by Indonesian Local Government Authorities

Through different forms of decentralization variables, this study investigates Indonesian local government authorities' 2006 financial accountability reports in terms of local government authorities' contributing funds to political parties. Audit results by the Supreme Audit Body reveal that many articles were violated by these authorities in regard to the distributing, administrating, and reporting of assistance funds from them to political parties. Each rupiah committed by the 221 local government authorities involved in this study violated, on average, 1.8 articles, indicating a low level of compliance.

Critically, the study finds that administrative, fiscal, and political decentralization decreases discrepancies. The less administratively decentralized provincial authorities, where decision making is a level of government farther from the people, are more likely than non-provincial local government authorities to make discrepancies with political party legislation and regulations. Fiscally decentralized local government authorities, who earn a higher fraction of their revenue from local sources, also tend to have fewer discrepanciesFinally, politically decentralized authorities with a higher percentage of elected officials from the decentralized supporting ruling coalition, also have fewer discrepancies.     

From authoritarianism to political democracy in Grenada: Questions for U.S. policy

Beginning as early as 1498 when Grenada had its initial contact with metropolitan forces, this island state has experienced little of the political democracy U.S. President Reagan pledged to restore to the country as part of the 1983 intervention. Yet, for the 1984 elections that followed the toppling of the remaining vestiges of the 1979–83 revolution, the United States and selected Caribbean allies attempted to amalgamate a party as an alternative to the Grenada United Labour Party (GULP) and the remaining revolutionary forces. The resulting New National Party (NNP) was electorally successful in 1984 but by 1987 defections from the Party had produced a base for the National Democratic Congress (NDC). In 1989 the NNP again divided. It was thus predictable that the 1990 elections would not return either wing of the National Party and instead would result in a coalition government led by the NDC. Chances for real political democracy in Grenada are improved but will not be easily realized in the face of severe economic crisis and a potentially weak government. The economic crisis could well promote current movements toward increased regional integration. It is important that the 1983–1984 pledge of the United States to promote democratization in Grenada be honored. W. Marvin Will is associate professor of comparative politics in the Department of Political Science at the University of Tulsa. He is past president of the Midwest Association of Latin American Studies and a founding member of the Caribbean Studies Association. Will has done extensive field research in the Caribbean and is the recipient of a 1991–92 Fulbright Research Fellowship for Caribbean Research. He is co-author of a forthcoming book on the Pacific and Caribbean Basins.     

Vigilante justice in post-communist Europe

Five cases in which the names of former secret informers who supplied information to the communist secret political police were unofficially disclosed are discussed in terms of the motivations of their authors, their timing relative to 1989 and their countries’ lustration and file access legislation, and the information they make available to the general public. After contrasting them with civil society efforts to promote transitional justice and unofficial truth projects, it becomes evident that these unofficial disclosures were animated by revenge as much as the quest for unveiling the truth about communist repression.     

Saving Children from a Life of Crime: Toward a National Strategy for Early Prevention

A great deal has been learned about childhood risk factors for offending and about effective interventions targeting these risk factors that reduce later delinquency and criminal offending. The time is right to implement a risk-focused, evidence-based national strategy for early prevention in the United States. A National Council on Early Prevention could provide technical assistance, skills, and knowledge to state and local agencies in implementing prevention programs; could provide funding, continuity, coordination, and monitoring of local programs; could provide training in prevention science for local people; could commission systematic reviews of the effectiveness of interventions; and could maintain high standards for evaluation research. The main aim of this article is to outline a national strategy for the prevention of delinquency and later offending. It identifies and discusses critical lessons learned from Western countries, such as Canada and Sweden, about the development of national crime prevention agencies.     

Transformation of bureaucratic states in eastern europe: public expenditure lessons from latin America

Creation of functioning public administration systems in Eastern Europe is made difficult by the need to tear down the centralized, state-owned economy of the past 45 years, deal with existing fiscal and security crises, and build new administrative systems and analytic capabilities. This paper suggests that the core of such an effort should be a focus on public expenditure management improvements through innovative training and technical assistance. In Latin America, too often aid was focused on supplying information technology without attempts to overcome obvious constraints to demand for its use. Comparative analysis of public administration systems in both regions reveals the same problems of (1) overcentralization of management and intergovernmental relations which destroys decision-making legitimacy, and (2) legalistic and compliance-oriented administrative systems which destroys incentives to manage effectively. To avoid these problems in Eastern Europe, technical assistance should stress incentives for decentralized management, and more flexible fiscal controls at the center.     

The spaces of economic crisis: Asia and the reconfiguration of neo-Marxist crisis theory

Neo-Weberian and Marxist theories of crisis have typically been built around analysis of crisis tendencies in a single industrially developed national economy. While neo-Marxist theories of development have noted various implications of analyses that take seriously the specificities of capitalism in developing countries, there is somewhat less work from neo-Marxist perspectives on theories of crisis. The economic crisis that hit Asia in 1997 has important transnational and subnational dimensions that invite further elaboration of such a neo-Marxist perspective. This article engages such elaboration through critical reconfiguration of Samir Amin’s core-periphery spatial ontology and deployment of this reconfigured ontology to explain specific features of the uneven development of the Asian crisis. Jim Glassman is assistant professor in the Department of Geography at the University of British Columbia. His interests are in state theory and the political economy of development in newly industrializing countries of Southeast Asia. He has conducted previous research on industrial development in Thailand, as well as on the economic crisis and structural adjustment in Thailand, South Korea, and Indonesia. His current research focuses on populist and nationalist political reactions to the Asian economic crisis. An earlier version of this article was presented at the Global Economic Geography Conference in Singapore, December 1999. The author would like to thank participants in that conference, along with Ruth Berins Collier, Eric Sheppard, and two anonymous SCID reviewers for valuable comments and criticisms. Some of the research for the article was undertaken with the assistance of an Izaak Walton Killam Postdoctoral Fellowship from the Department of Geography at the University of British Columbia.