I am struck by the economic situation faced by Utica’s mayor. Thirty-seven percent of the city’s property is tax-exempt and over 20 percent is vacant. Unemployment is higher than the state’s average, and they’ve borrowed all they can legally borrow. They’ve cut until it hurts.
The mayor has concluded their only way out of this death spiral is to rebrand the city and pursue economic development. That scenario sounds very familiar. Except for the debt limit, it could be Otego, Oneonta or Otsego County.
An economy needs three sectors to be in balance: the public sector, retail sector and manufacturing sector. All three need to work together for the economy to prosper. This area had a stable public-sector economy. The region has become dependent upon the health care industry, educational institutions and various government agencies which provide good paying jobs and benefits.
However, public-sector growth by itself has resulted in an unbalanced economy. In order to regain balance, we must recognize all components of our economy need to be vibrant and work together for mutual benefit. The colleges and hospitals need the retail and manufacturing sectors, and the retail and manufacturing sectors need them. For example, when the college’s students need jobs or places to intern, who will provide them? The private and manufacturing sectors.
The public sector provides “services” for a community. They include education, health care, public safety, infrastructure like roads and other government services. These services are paid for through taxes such as state and federal income taxes; corporate taxes; school taxes; town, city and county property taxes; state and county sales taxes; highway taxes; truck-mileage taxes and various other taxes. There are also many fees, including the purchase of lottery tickets, which support education. These taxes and fees are paid by you and me, as citizens, and by the retail and manufacturing businesses.