Friday, September 25, 1998

Now is a time for Abilene to be saving, not spending

By Brian Ferguson / Guest Columnist

Break open the white grape juice everybody, the boom is back. That, at least, is the going line at City Hall.

You see folks, a crop of favorable statistics has fallen into the laps of our elected officials, and they're getting big ideas. Big ideas that will, of course, hit you in the wallet.

It all started out like this. A few new jobs began popping up in town. Then some companies decided to open up shop in the Key City. Finally, Congressman Stenholm announced he was bringing home the bacon in the form of expansion at Dyess Air Force Base. All combined, the winds of prosperity were blowing on Gary McCaleb's chimes in a serious way.

So, with all this economic good news the city is now looking at taking up some capital improvement projects. Simple things like parks, road improvements, and upgrades to the zoo are on the list. The reasoning behind all of this seems elementary enough: Life is good in Abilene, why not make it better?

Well, simple economics should provide the first major deterrent to such a bond issue. You see, Abilene is in a period of cyclical, or short-term, growth.

It works like this: New companies come to town and seek workers. As the labor pool shrinks, wages rise. For a moment life is good for everyone. Unemployment is low and wages are rising. This is where Abilene is sitting right now, and this is where people usually get excited about bond issues.

However, economics doesn't stop. As wages rise, profits decrease. This leads to a reduction in investment and thus stifles economic growth. That lack of growth then triggers a slowdown in the labor market. When people stop moving to town, the whole cycle gets nasty for the general population. People like construction workers get laid off as demand for new homes drops. Restaurants begin to see a downturn, and so the process goes until just about everybody feels the crunch. Think 1986.

Standing alone, such an economic downturn can be hard on a family trying to make ends meet. Therefore, when you couple a slumping economy with an increasing tax burden, the results can be disastrous.

The current rate of expansion in the city should also deter the issuance of bonds for another reason. At some point in the next few years, the AISD is going to have to face the numbers and begin another period of school construction.

The last time I checked, there is no way on Earth that Dyess Elementary will be able to handle the influx of children it will receive from the new off-base housing units. Moreover, Lincoln Middle School is about to burst. In fact, almost all the middle schools are littered with portable buildings that were supposed to be eliminated after the last bond election.

As it stands now, the situation isn't critical. However, the idea of overcrowded schools, a high city tax rate, and a need for an increase in school taxes is not going to go over well during an economic bust.

So what should be done?

The answer is clear. Now is not a time for spending, it is a time for saving. By keeping taxes low, and living on a lean budget, the city can prepare for a day when times are tighter.

While the rewards of such prudent practices will not be as pretty as a park or as noticeable as a new library, the long run advantages will certainly improve the look of most people's wallets.

Brian Ferguson, a former WISD school board candidate, is studying advertising and accounting at the University of Texas at Austin.