Issue Topic 39
The following appeared as part of an article in a Dillton newspaper.
“In an effort to bring new jobs to Dillton and stimulate the city’s flagging economy, Dillton’s city council voted last year to lower the city’s corporate tax rate by 15 percent; at the same time, the city began offering generous relocation grants to any company that would move to Dillton. Since these changes went into effect, two new factories have opened in Dillton. Although the two factories employ more than 1,000 people, the unemployment rate in Dillton remains unchanged. The only clear explanation for this is that the new factories are staffed with out-of-town workers rather than Dillton residents.”
Write a response in which you discuss one or more alternative explanations that could rival the proposed explanation and explain how your explanation(s) can plausibly account for the facts presented in the argument.
Apart from the possibility that the factories are employing workers from out of town, there are several other plausible explanations for the unchanging employment rate in Dillton despite the relocation of two new factories there. This issue illustrates that in tackling public policy problems communities must necessarily take the broadest possible view of possible effects and outcomes both positive and negative. For instance, lowering the corporate tax rate by a sweeping 15% is a broad-brush measure that likely has many unintended effects on the economy of the region. This paired with new expenditures on relocation grants while for companies, ignores the important role that labor plays in this delicate public policy equation. Clearly Dillton has not done enough to ensure that their community is a desirable place for workers to live. And future economic policy initiatives would serve the community well to do so.
It is common for a community’s most successful entrepreneurs to become involved in local government. These individuals are the most well-connected, most powerful members of that community and they arguably have the greatest stake in the long-term health of the community. However, these individuals are by no means the perfect geniuses of economics that their biographers would make them out to be. When such individuals are empowered to steer the governance of a community, they bring their particular biases and political connections and prior commitments with them. It would seem that the leaders of Dillton are no exception to this all-too-common common scenario. Their decision to offer companies a tax boost likely reflect their professional experience as executives and the prior ideological and social commitments therein. Dillton’s City Council in seeking to solve the unemployment problem in their town have ironically failed to take into account the perspectives of the common workers.
A more thorough explanation of the failure of Dillton’s new policy to provide work for the people, would need take into account the living conditions in that community. If reasonably priced housing, schools, access to healthcare and recreational facilities are absent, or the people the community are otherwise disincentivised from staying or moving there for work, then the overall employment situation will suffer. Indeed, any gains made from the tax and grants policies may even be offset by the flight of workers who, despite new employment opportunities, have only meager desire to stay in town.
The quality of jobs available to workers as a result of these policies is also another potential roadblock to the improvement of the unemployment situation there. In other words, if the workers skill sets don’t match the jobs available, then the town’s economy is back to square-one in terms of the unemployment puzzle. The Dillton city council owes its citizens and resident workers to be more attentive to their living conditions, their educations and training levels, and to the factors which will satisfy their needs.
Started going off the rails a bit in the second paragraph. Is it necessary for me to be making a sort of overarching argument about the failings of the bourgeois city council in general? Is it worth trying to organize my essay in this way, or am I just creating a pitfall for myself… I dunno. In this case, since I was able to kind of pull things back together in the final paragraph, I think it works. My second essay this morning was not so successful that way.