Finding the Perfect Budget
Michael Krasny of KQED recently did a show on the California State Budget in his “Forum” program. Listening to the members of his panel crib about the budget brought about the following reflection for me.
Trying to get the perfect budget is an impossible task. I am a decision analyst, and in our training, we are taught to question the frame of the decision. In this case, it seems to me that the frame can be flipped inside out. Instead of Gov. Jerry Brown having to make the hard decisions on what to fund and what to cut, why not let the people of the state decide?
What if we found a way to let people determine the portion of their income tax and sales tax that should go to a particular project? Income taxes could be filed along with a preference list of projects allowing people to decide where their money should go. Sales taxes can be allocated by districts – each district can be told how much sales tax they’ve provided, and then each resident will have their fraction of the sales tax that they can allocate. Example – if a district has given $10 million in sales tax and has 100,000 residents, then each resident in that district has $100 to allocate to projects they like. If a that resident also pays income tax, then they get to allocate their income tax portion that goes to the state as well. As projects get funded, they can get taken off the list so people can see in real-time which projects are not yet fully funded.
Basically, the Governor and his team will no longer need to make these decisions. People will make it directly, and all he has to do is facilitate that process and then execute the projects. It would take democracy to the next level and eliminate the need for lobbying a few people behind closed doors. Instead, project initiators will have to take their message to the public and convince them. The coercion of having someone’s money being used against their wishes will end. The public will have only themselves to blame or applaud for the effort they take in learning and supporting the projects that make sense to them.
The bay area, with its technological acumen, might be a great place to try this out as a pilot before scaling it to the rest of the state.
To this post, there was a reply:
That doesn’t make sense, most of the population are not familiar with fiscal budgets, spending, lobbyist, how the tax dollars are actually allocated to make an educated decision about how to allocate their tax dollars.
This struck me as really curious, and here was my response:
That sounds like a curious assumption. Do you believe that people are educated enough to vote for the right representative but not educated enough to make up their mind on what they should support? Even if you do believe that, Gov Brown can have a default allocation – those who trust the government’s wisdom can go with that and those who have other ideas can decide what to fund. It is a matter of having a list of categories, and either funding broadly by accepting defaults or drilling all the way in to specific projects depending on how much time one has. If I don’t know much about a project, I can rely on the internet to learn more, or take the help of volunteers/non-profits who are sure to spring up to help me decide.