As House members head back to Washington this weekend, local governments are prepared for what might happen if the U.S. goes over the fiscal cliff.
That combination of spending cuts and tax hikes will go into effect Jan. 1 if Congress does not act. In cities like Memphis, Tenn., the country’s poorest, officials worry about the potential loss of federal funds.
“There are so many individuals who depend directly on what we’re getting from Washington, all the way from housing to food stamps,” says Mayor AC Wharton, “it would have a drastic impact on our city.”
Uncertainty, says Mayor Wharton, is what local governments like his are most concerned about.
“If they could just get it together up there, we’d be just fine down here,” Wharton says, noting that his city has been planning for the coming fiscal cliff long before negotiations between the White House and House Speaker John Boehner broke down last week.
Wharton exhorted Congress to act, regardless of what specific plan they ultimately enact. “We say at the local level, hey, do something even it’s wrong. But, do something. And if it’s what we like, we’ll smile. If it ain’t what we like, hell, we’ll get over it.”
Memphis has been resilient, despite its challenges. But many lie ahead. Wharton compared the city’s well being to a patient rushed to the emergency room.
“I think we have managed to stop the hemmorhaging. We’ve got a good diagnosis of what we’ve got to do. And the prognosis is guarded.”
One reason, persistently high unemployment, and a population with low skills, incomplete education, or barriers to capital that Wharton calls “unemployable.” His approach to fixing Memphis’s persistent poverty would require a tailored approach.
“We can not come up with a massive… poverty program. We’ve got to take each individual and write a prescription, if you will. Can you imagine how daunting that is? But that’s what it’s going to take.”
Despite unemployment at 10.5 percent, Wharton is cheered by housing starts and investment from large production facilities.
“Any recovery is better than no recovery at all.”
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