POS 410 Test 3 Study Guide

POS 410 Test 3 Study Guide - POS 410 Test 3 Study Guide...

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POS 410 Test 3 Study Guide 23:18 Urban power reconsidered (March 9-11) Capital Mobility (i.e. “footloose” businesses) Private Sector is main engine of prosperity and growth in cities Government depends heavily on business activity to generate tax revenues Business control of jobs and credit—necessary elements for successful city Capital is mobile; city boundaries are fixed o Some businesses are “footloose” Business resources also important for campaign contributions Limited authority of city governments to affect prosperity, working conditions Therefore, most cities strive to attract and retain business investment City limits theory (Peterson) Unitary Interest: city government, business, residents, all have interest in city’s prosperity o “Groupless Politics” Constant competition with other cities o Capture export industries, high-income residents Thus, pressure for “good business climate” Avoidance of redistributive policies o Policies aiding poor seen as a drag on the city
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National governments should handle health and welfare; cities should not Regime theory (Stone) Stone revisits Hunter’s Atlanta o Economic growth, but neighborhood discontent Even black mayors focused mainly on downtown redevelopment Business has “systemic power” o To be successful, mayors need the backing of business o Jobs, tax base, access to credit A “governing regime” o Close cooperation, inter-linkage between elected officials and business executives o Persists over time Unlike Peterson, politics is alive and well But electoral coalitions =/= governing coalitions o Electoral supporters can be “bought off” with selective benefits Power: the capacity to get things accomplished o Cooperation, not compliance New Orleans as a “non-regime” city Key characteristics showing absence of regime in NO (Burns and Thomas): o Lack of agreement on agenda for the city
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o Shifting, issue-based coalitions instead of long-run governing partnership o Each new issue required fresh negotiations Thus, hurricane prepartation and response marked by disorganization, lack of communication, lack of resources Budgets and fiscal policy (March 23-25) Tax base; tax rate Business mobility and fiscal policy o The more businesses contribute, the lower the tax burden on residents o But large businesses have power in their ability to move out o Responsiveness of tax base to tax rate o Revenue= tax rate X tax base Unlike US government, cities cannot run a permanent debt o Do not control money supply o Can go bankrupt Labor-intensive city services Typically, public safety is biggest category City services are labor-intensive o Makes budgets hard to reduce o Unionization reduces flexibility
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Incrementalism in budgeting Why do expenditures differ across cities?
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