What the Government can do

The new Administration's opportunity comes, in large measure, from a buoyant economy. Without the economic advances of the past eight years, it would not have the means to even begin the job that must be done domestically. One of its most important functions, therefore, is to maintain prosperity through fiscal and monetary policy. A sound and expanding economy is more important than any single federal program in combatting poverty and many other social ills. Beyond that, how should the Federal Government direct its huge (but not unlimited) resources toward achieving the nation's ideals? The question now demands a different answer from the one that Americans have grown accustomed to since the New Deal. The Depression clearly required Washington to "do for the people what they cannot do for themselves." However alluring that idea seemed as recently as the days of Lyndon Johnson and his Great Society, it is now close to being self-defeating.

All too often, big federal spending has produced not social miracles but merely a swollen bureaucracy and the anger of those who feel cheated by the gap between promise and performance. The nation now has ten times as many federal agencies concerned with city problems as it had in 1939, and the problems are worse. The lesson is that federal programs tend to be innovative only at first; soon both their officials and their beneficiaries, such as subsidized farmers, share a vested interest in making eternal what no longer makes sense. Even after their purpose is achieved, federal agencies rarely fade away; they simply double their budgets and staffs. Even as Americans bemoan more taxes, federal largesse often makes them takers rather than givers.

jf The U.S. cannot go back to its 18th century maxim: "That government is best which governs least." A highly interdependent nation needs a great central government to cope with problems that affect all citizens and states. But equally obvious, Washington needs a new tactic: it must encourage Americans to do for themselves what they could do if they tried to. This idea has often been used as a sort of shorthand for the callous notion that all public assistance is a coddling waste; it does not mean that in the present context. What is at stake now is the freeing of the individual from unnecessary dependence on a remote bureaucratic apparatus or the liberation of local communities from the notion that they cannot help themselves. The Government can dramatize the issues, provide the example, and spend its money in new ways that release private energies on a far greater scale. Ideally, it could also set a new standard for federal officials' performance. Promotion and pay raises might well go mainly to officials who liquidate their programs fastest and release more money for new federal efforts. The goal should be to enlarge federal leadership and contract federal bureaucracy at the same time.

Tax sharing

Toward these ends, Nixon should seek a better and more generous system for sharing federal tax revenues with states and cities. Last year Washington collected some $148 billion in taxes from the states and returned $17 billion to them in the form of grants-in-aid for specific programs, largely supervised by the federal bureaucracy. While the states need and compete for these funds, the Governors complain that the grants have strings attached; many bypass state and city authorities, and the federal programs are often uncoordinated. Federal-program administrators are accused of "tunnel vision": being concerned only with their overall objectives regardless of community feelings.

What the states prefer is a fixed share of federal revenues without strings attached. Both Hubert Humphrey and Richard Nixon endorsed revenue sharing in principle during the presidential campaign. But outgoing HEW Secretary Wilbur Cohen was adamantly opposed on the ground that Washington's nationally elected officials should not "hand over funds to 50 Governors to spend without a definition of national priorities."

Cohen is right in the sense that federal funds should never be used for such ends as protecting school segregation. Washington, on the other hand, has far more tax money than it can disburse effectively at the local level. If adequate protections can be worked out, Washington should now share some of its revenues on a fixed basis with hard-pressed states and cities, and thereby encourage far greater local initiative.

Poverty

Though millions have risen from poverty in the past eight years, 22 million Americans remain without basic means. The key is jobs. In its last year, the Johnson Administration found one promising approach to the hardcore unemployment problem. Since it costs more for industry to hire the slum dweller, who often lacks even the simplest skills, the Government promised to pay all extra training costs (average: $3,000 per man). Partly as a result of this guarantee, partly out of new awareness of their social responsibilities, businessmen responded. The JOBS program has already exceeded its goal, hiring 128,000 people who just a few months ago could not have got past the plant gate. The Nixon Administration should not only continue JOBS, as it has promised to do, but should also expand its scope from the present 50 cities to at least 200. Cost: $1 billion a year, about five times what is currently being spent.

As important as the numbers was the lesson: with a little imagination, federal money can create new opportunities. The Nixon Administration should thus continue most other present job-training programs (though perhaps not the Job Corps, which is not working very well). Tax incentives and low-interest loans, even though they are a drain on the Treasury, could also be used to induce business to build plants and other job-producing facilities in impoverished rural areas and big-city ghettos. Used in the right way, such incentives can draw money from other sources, multiplying the taxpayers' initial investment many times.

For the thousands whom private industry cannot possibly take, however, the Government should offer refuge as "the employer of last resort," a concept long espoused by Nixon's urban adviser, Daniel Patrick Moynihan. Many thousands could be usefully employed as, among other things, teacher aides and police auxiliaries. Wages could run about $4,000 a year, with another $1,000 for training. Though it is impossible to say how many people would want or need this program, the Government could at least test the response this year by offering 150,000 jobs. Cost: $750 million, a part of which would be offset by reduced welfare costs. If necessary, the target could be boosted in future years.

To replace the present incredibly cumbersome welfare system, the Government should seriously consider income supplements, probably in the form of the negative income tax. For many, particularly ghetto Negroes, poverty and apathy have become so joined that no job-training program really suffices. The only way to break the circle of despair may be to give them some form of guaranteed income, minimal as it might be. Incentives could be set up so that work would be rewarded and no one would live comfortably off the Government. The poor would remain, but the really poverty-stricken would disappear. The worst deprivation would be done away with. It would not be cheap--as much as $30 billion a year (as against the present total welfare bill to federal, state and city governments of $5.5 billion). The proponents of the scheme argue convincingly, however, that the cost of the negative income tax would gradually decline as growing numbers of people escaped the poverty class.

For the present, the Nixon Administration could vastly improve the existing welfare system at comparatively modest cost, simplifying and humanizing the welter of regulations that governs the welfare system. At the same time, the Federal Government should assume all the costs of welfare (it now pays about half), leaving administration, however, to local and state governments. This one act (cost: $3.4 billion) would relieve the cities of a burden that threatens to bankrupt them. One huge advantage of this federal role in welfare would be to standardize welfare payments across the country, thereby possibly reducing the migration of the poor from states with low benefits to areas with high payments (in one important program, Aid to Families with Dependent Children, New York State offers benefits of $71.75 for each member of the family, as compared with $8.50 in Mississippi).

Cities

Despite the attention given to the urban crisis, the cities continue to deteriorate. So far, one of the least used resources, particularly in the slums, has been private industry. The potential in private capital is enormous, and both businessmen and bureaucrats must work to exploit it. Taking advantage of low-interest loans from the Federal Housing Administration, the Boston Gas Co., for example, provided additional capital for the rehabilitation of 3,000 apartments in the Roxbury ghetto. The result was not only better housing for several thousand people, but also the acquisition by Bos ton Gas of 3,000 gas-using customers and a valuable tax-depreciation advantage. The return was not so great as a similar investment might have made elsewhere, but the les son was clear: a profit can be made.

The Government might try to make the ghetto a high-profit magnet. For example, it could give bigger tax write-offs for ghetto investments, cheaper loans, and guarantees simi lar to those it offers to U.S. investors in underdeveloped countries. The inducement of tax holidays made Puerto Rico's Operation Bootstrap a resounding success. If the business man and the Government looked at the ghetto as an underdeveloped country, they would in fact see one of the world's greatest potential markets. If black incomes were brought up to the white level, businessmen would have a new market of about $20 billion a year.

Private investment, however, will not do away with Government programs, which must continue to expand. In the Model Cities program and the Housing Act of 1968, the Nixon Administration has the tools -- money excepted -- to make real improvement in the lives of millions. Model Cit ies is important because it tackles the slums from all angles, forcing city administrations to plan far more efficiently than they have ever done before. Unfortunately, the program has never been adequately funded. To make it work, Nixon should increase this year's allotment of $625 million to at least a billion, next year's to $1.5 billion. He should also adequately fund the Housing Act, which seeks, through subsidies, to build or rehabilitate 6,000,000 low-income units by 1978 (v. 60,000 a year now). Cost to the Treasury: $13 billion over the decade.

To open up the ghetto and take care of the 100 million population increase expected in the next generation, the Government could encourage the development of at least 100 entirely new towns, varying in population from 100,000 to 500,000. Great Britain has built 24 new towns since World War II, and private developers in the U.S. are already experimenting with the concept. Barriers to private development are enormous, however, and the Government might take the initiative with a New Towns Act and a New Towns Administration within the Department of Housing and Urban Development.

The slums are not the only thing wrong with U.S. cities, and the urban crisis can never be solved until Americans change their concept of the city itself. Central to any change is control of the automobile. With the Federal Highway Act, which offers 90% federal funding for expressways, the Government destroyed any possible balance between cars and other forms of transportation, such as subways and monorails. Though subways might be more efficient, cities have in effect been offered expressways virtually free. The lure has usually proved irresistible, and as a result cities--not to mention the countryside--have been torn apart. The car has not only wrecked the city physically but poisoned its air as well. Auto exhaust fumes account for about 60% of air pollution in the U.S., even with the addition of exhaust-control devices.

The answer, of course, is not to abandon the automobile--except in the central city--but to restore the balance. The Government already supports mass transit ($153 million this year, v. $4.1 billion for roads). Without costing the taxpayer an extra penny, it could multiply this sum 13 times simply by diverting half the money it spends for roads to transit lines. To improve the civic order, the Nixon Administration could also grant more generous funds for planning and esthetic improvements, going so far as to deny federal grants for such things as sewage plants to municipalities that continue to ignore the environment. A little money here would go a long way. Almost any amelioration would be valuable.

Crime

Deeply concerned about law and order, Americans tend to look at crime in only one dimension, focusing on the chase and the capture. They tend to ignore the courts, the prisons and the conditions that cause crime. The Federal Government can probably do less about crime than it is often assumed. But with relatively modest expenditures--or no expenditures at all--the Government can help merely by re-examining the problems. Almost all authorities on crime agree, for example, that many social infractions now classed as crimes--drunkenness, drug addiction and homosexual relations between consenting adults--are not matters for the police or the criminal law. The problems are real enough, but should be dealt with in other ways, freeing police for more crucial tasks.

The Nixon Administration could prod Americans into looking anew at crime by asking that federal law be brought into line with sociological and psychological thinking--not to mention the facts of life. It should also research better ways of handling such problems as drunkenness and drug addiction. Marijuana laws, in the eyes of many young people the worst example of hypocrisy and repression, should be reexamined, with more research provided on marijuana's long-term effects.

At the same time, the Administration should improve the federal court and rehabilitation systems and fund the

Crime Control and Safe Streets Act of 1968 to the full legal authorization of $300 million. Whatever President Nixon does, he will not find quick, inexpensive solutions. One exception: passage of a strong gun-control law that would not only register all guns but also curb ownership for anything but hunting. Without gun control, all other measures are half steps.

Education

More than one out of every four Americans--almost 58 million--is attending some kind of school today. Though education is and will remain primarily a state and local responsibility, the Federal Government can do more to widen and improve the educational prospects of every American. In the elementary and secondary schools, the chief object of its attention must for the immediate future remain the ghetto child. One of its top research targets should be how to educate the black child of the inner city; no one has yet found a very good answer. Truly effective ghetto education is at least as important as a cure for cancer.

Beyond high school, the Government can do far more to encourage diversity of education. There are, for instance, many alternatives to the B.A. degree. Not everyone needs or wants the traditional four years of college, but many can benefit from advanced training. As leisure time increases, more adults will also want fewer formal classes. The Government itself should not provide these services now, but its grants and research can point the way toward making education more flexible and relevant in a day when rapid change so quickly outdates formal learning. The Carnegie Commission on Higher Education estimates that federal expenditures for higher education (now $3.5 billion a year out of $17.2 billion from all sources) must increase $10 billion a year by 1976. This may be far too high, but the current federal education investment at all levels ($9.2 billion a year) will probably have to rise considerably.

Environment

In no other aspect, not even race, has U.S. society failed so spectacularly as it has by its abuse of the environment. Day by day, Americans are destroying the landscape and poisoning the air they breathe and the water they drink. The Johnson Administration was partly successful in stopping the trend; the Nixon Administration should do far more. It should vigorously enforce and fully fund existing antipollution laws. If they prove insufficient, it ought to ask Congress for even tougher measures. It must also act swiftly to preserve scenic areas, waterfronts and unspoiled islands. Fortunately, the country still has many deserving areas. It might also help local governments fund more parks near cities, and if they still cannot afford the land, the Government might step in with suburban national parks.

Beyond that, the Administration, including the President himself, must constantly preach the values of conservation and the need for a balanced environment. Nixon should adopt immediately the recommendation of one of his task forces that he appoint a special assistant for environmental affairs. Alternatively, he might accept Stewart Udall's suggestion for a Council of Environmental Advisers, which would have the same influence over the environment as the Council of Economic Advisers has over the economy. Above all, ecology--the interrelationship of all living things within the framework of the environment--must become as familiar a word to bureaucrats as GS-12 or ABM. As the new President's task force commented: "The real stake is man's own survival--in a world worth living in."

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