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Here we go again. The Legislature is in session and the governor tells us how tight the budget will be. Can you recall a time when Hoosier state and local budgets were not in trouble? Did any governor ever come before the General Assembly and say, “Folks, we got more money than we know what to do with. Now, how should we improve government services? Where do we focus first?”
We have not heard those questions because Indiana’s economy has performed poorly, compared to the rest of the country, for so long that we don’t have the options of good times. For example, in the third quarter of 1998, Indiana enjoyed 2.01 percent of the nation’s personal income. Ten years later (July, August and September 2008), our share sank to less than 1.80 percent for the first time since 1948, when such records begin. That is a loss equal to approximately 12 percent ($26 billion) of our personal income for 2008.
For the past 10, 20, 30 years, Indiana has not kept pace with the nation. This long-term slide goes on and there is no evidence the current administration will be able to reverse the trend.
That is not to say current policies are inappropriate for our needs. Our economic development programs are both opportunistic and directed. We are opportunistic in that we work happily with a Honda to bring
more automotive activities into Indiana.There is little diversification in such a move. But diversification is not a meaningful objective. Jobs are not the ultimate objective. Income is what we seek. Income creates jobs, provides for improvements in the quality of life, and might even buy some happiness and civility.
For this reason, the directed efforts of the state to improve education and training, to encourage biotech, life sciences, modernized manufacturing and logistics with other magical sectors are most appropriate. Each is aimed at increasing Hoosier income.
Today, we have a tremendous task before us. Basic government services must be maintained in difficult times. Yet our Hoosier governments at all levels are often mediocre performers. Consolidating the witless with the indifferent will not lead to excellence. Nor can we expect decreased costs of service unless we are able to move our best public administrators into more effective positions. And we must attract more competent citizens into public service.
If Indiana is to make significant strides, we must depend more on the private sector. What is the largest part of the private sector? You, the people in the households of the state. Not business nor the not-for
profits, but you as a consumer, a citizen, a commuter and a colleague.Your tolerance of poor performance at work, your acceptance of inferior quality in the marketplace, your neglect of improper behavior on the streets keeps this state from making progress. Our collective Hoosier preference for smooth waters leaves us sinking in the mire of a backwater society.
For example, why are children and adults with learning disabilities served so poorly? Why are our best students turned by inadequate schools into stultified, sardonic caricatures of teens? Why are our firms not competing as well as they could with those in other states? Is it that dunderhead who works next to you or the one who is your boss?
Recent polls indicate that Hoosiers want better lives and are willing to pay higher taxes to achieve their goals. But there is no evidence they are willing to step up and speak out. Nor is there evidence that many notice the inadequacies in their community cocoons.
Look around. See something you don’t like? Get going and change it. •
Marcus taught economics for more than 30 years at Indiana University and is the former director of IU’s Business Research Center. His column appears weekly. He can be reached at mmarcus@IBJ.com.
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