The Bowles-Simpson Deficit Reduction Commission released it's preliminary recommendations this week for closing the government's massive budget deficit. The report will contain a lot of controversial cuts and tax increases and given the fiscal crisis in which the country finds itself, the effort is commendable.
While a lot of great ideas are listed in the preview, there are certainly some where more thought is needed. Some budget cuts may bring short term gains, but end up costing the public more in the long run. The same is true for tax increases.
One proposal that caused me immediate worry is the elimination of the Appalachian Regional Commission and the Delta Regional Authority. I live in a state that is under the jurisdiction of both agencies (the ARC in eastern Tennessee and the DRA in the west part of the state). There is serious poverty in both areas and these two agencies have done commendable work promoting economic development in two of the country's most underdeveloped regions. The relatively small investment taxpayers make comes with a big payoff in terms of jobs created and tax revenue generated.
Both agencies also realized many years ago that economic development in poor communities is stifled when a town lacks doctors and patients have to travel long distances to get basic health care. That's why they both have active J-1 waiver programs where doctors willing to spend three or more years in a medically underserved community can be sponsored to remain in the US after their training years are over. These programs cost little compared to the benefits they provide and they disproportionately benefit poor people.
I hope that as Congress considers the proposal's recommendations, that there be an opportunity to take a careful look at each recommendation before deciding to accept the idea.
By the way, here's a press release from the DRA making the case for its importance:
“The Delta Regional Authority recognizes the important mission of the Commission as it looks at deficit reduction concepts; however, I strongly question the Commission's recommendation to eliminate the Authority," DRA Chairman Chris Masingill stated today. Continuing, Chairman Masingill said, “The Authority is doing its part to improve the economy of the region and reducing the nation’s budget deficit – through our strong record of job creation and retention.”
“The Authority's local and regional investments are returning taxpayer dollars, and are improving the region’s economy and its communities. I will personally go anywhere - before any panel - to make the case for our region and the Authority. I am eager to engage in the conversation. I am confident of the Authority’s market-proven work record,” Chairman Masingill said.
“The Delta Regional Authority serves as an economic multiplier for the 8-state Delta Region,” said Chairman Masingill. “We will continue to exist and play an important role in the nation’s economic recovery because the Authority is in the business of growing and retaining jobs, and the best way to reduce the deficit and spur the economy is to put people back to work.”
“By creating the Delta Regional Authority, bipartisan Congressional partners, solidified the national commitment to uplifting the Delta Region. This unique economic development organization has produced real results with clear outcomes. In less than a decade, the Authority has invested nearly $86.2 million into more than 600 projects leveraging $1.4 Billion in private-sector investment, producing an overall 22 to 1 return on taxpayer dollars.”
“Together with our partners, the Authority is creating/retaining approximately 19,000 jobs, and we are bringing new water and/or sewer services to more than 43,000 families. An independent report from USDA’s Economic Research Service found that per capita income grew more rapidly in counties where the DRA had the greatest investment. Each additional dollar of DRA spending per capita results in a $15 increase in personal income – and this means real money in the pockets of our families.”
“Not only do we generate more income for our families, but we do it with transparent policies that are accountable to taxpayers, as proven by nine clean independent audits showing tangible results.”
“The Authority knows the economic pulse of the region, as we work hand-in-hand with local leaders, governors and other federal agencies. Together, we have shown consistent progress with our leverage, our outcomes and our reduction of duplication and fragmentation.”