Unintended Consequences

In the mornings I listen to This American Life. I’ve been commuting again after a year off so I’ve had a stack of them to go through and it’s great to be listening to podcasts again. I’m only about 3 weeks behind and this morning I heard a story about Colorado Springs and the fact that a tax increase was shot down and so they started turning off street lights. When residents would call the would actually be told “Remember the $200 increase that got shot down? Yeah, that’s why. If you want your light back on it will be $150.”

Oh, you want us to landscape the park again? $2,500. And yet that wasn’t the part that got me thinking, it was the next call – a man just coughed up$300 to get the lights on his street back on and a city councilor said “You know if you had just voted for the increase you only would have had to pay $200 and you would have your lights, your park, snowplowing and other services.” the man responded something to the effect of “No, this way is better”. As the Councillor then summarized – the citizen was willing to pay a premium because he didn’t trust his elected officials enough to use the funds to his satisfaction.

In our town, you pay for your trash bags. I like this model – if you recycle and don’t buy a lot of crap you have less trash and you pay less. You could argue that this penalizes large families and the poor since larger families generate more trash and the price of the bags are a higher percentage of a poorer family’s income. You could also counter that the constitution says nothing about your right to generate unlimited trash. Both would be right (unless there’s some amendment I missed the memo on). You’d be right in both cases. And this creates a whole slew of interesting economic questions and unintended consequences: Was it better to just have the trash fee as part of the property tax or does this discourage recycling? Is volume of trash a concern? What happens in the parks as everyone sneaks trash into public trash cans (I see it all the time)? People “exporting” trash to work or neighboring towns?

Until the dawn of both the spreadsheet and the internet the cost of measuring these things was more expensive than just saying “throw it all into the property tax”. Now with more ability to track changes down to the dollar, and share that with the public we may be poised for significant change here. Add to that the financial pressure of public jobs under scrutiny for benefits expenses far above the public sector and the pressure for change increases.

As I was thinking about it I saw a related example in front of me, a new technology, the Waze GPS app, alerted me to a speed trap. As I slowed down to the limit I thought “There goes $150 that’s going to have to get squeezed out of the budget from somewhere.”