Why the US Government Should Be Decentralized

The issue of centralized government institutions in cities like Washington, D.C., and New York City has ignited a fervent debate in the United States, drawing attention to the considerable economic, social, and political implications at play. Government employees in DC and NY and other large cities require much higher salaries and benefits and cost vastly more to provide office space.

Advocates for decentralization argue that the concentration of government power in these cities has led to exorbitant waste for taxpayers, employees being subjected to underperforming schools for their children, traffic congestion, excessive taxes, and disenfranchisement of workers who can’t even vote where they work.

This has sparked calls for a reevaluation of the centralized “big city” government model. Senators such as Blackburn and Hawley have seized upon ideas like this and Americans have begun to understand the massive waste that can be eliminated.

Rising Living Costs and Financial Strain

Washington, D.C., and New York City consistently rank among the most expensive places to live in the United States, with high housing costs and inflated prices for goods and services taking a toll on residents and government employees. A report by the Council for Community and Economic Research (C2ER) revealed that Washington, D.C., had a cost of living index significantly higher than the national average, making it challenging for many workers to afford basic necessities.

Challenges in Education Quality

Education is a vital factor in determining the quality of life for families, yet both Washington, D.C., and New York City face hurdles in providing quality education due to underperforming schools, inadequate resources, and high student-teacher ratios. A study by the National Assessment of Educational Progress (NAEP) found that D.C. schools ranked below the national average in reading and math proficiency, indicating the need for improvement.

Traffic Congestion and Commuting Woes

Traffic congestion in major cities like Washington, D.C., and New York City has adverse effects on the environment, economy, and residents’ well-being, contributing to stress, decreased productivity, and wasted time. The Texas A&M Transportation Institute estimated that traffic congestion cost the United States $88 billion impact in 2019 alone.

Excessive Tax Burden

Both cities impose high taxes to fund their operations and services, placing a significant burden on residents and businesses. High property taxes in New York City, for example, can deter homeownership and business expansion.  States like Texas, Florida, Nevada, Tennessee, New Hampshire and South Dakota do not even have state income taxes.

Disenfranchisement of Workers

Millions in New York and other big cities have no vote or say so in the area where they work. Many commute into cities and can’t even vote there. Also, Washington, D.C.’s unique status as a federal district without full representation in Congress denies workers the ability to vote for representatives who directly impact their lives, raising questions about democratic principles. Further, the DC structure creates a problem with a jury pool living on government property that is not representative of the millions of DC related employees. The DC Housing Authority serves 50,000 qualified low-income residents with 8,300 units in 52 traditional public housing developments.

Advocates for Decentralization Highlight Benefits

Proponents of decentralization argue that dispersing government functions across multiple locations offers several advantages:

1. Resilience and Redundancy: Decentralized systems are less likely to be completely incapacitated in the face of natural disasters, cyberattacks, or emergencies.
2. Faster Decision-Making: Local authorities can make swift decisions, adapting to specific circumstances without waiting for central approval from over a dozen police agencies.
3. Local Expertise: Local officials often better understand regional dynamics and can make informed decisions that align with local needs.
4. Effective Resource Allocation: Decentralization enables resources to be allocated based on local priorities, resulting in more efficient utilization.
5. Increased Accountability: Local decision-makers are directly accountable to their constituents, reducing corruption and improving public trust.
6. Cultural Sensitivity: Tailoring policies to regional differences avoids ineffective one-size-fits-all approaches.
7. Innovation and Experimentation: Decentralization encourages innovation at the local level, identifying successful strategies that can be scaled up.
8. Fostering Regional Development: Resources and investments can be directed to historically overlooked areas.
9. Reduced Bureaucracy: Streamlined decision-making processes improve the efficiency of government operations.
10. Safeguarding Democracy: Decentralization prevents the concentration of power, reducing the risk of authoritarian tendencies.

However, it’s important to strike a balance between decentralization and central coordination to maintain overall cohesion, unity, and effectiveness in government operations. The appropriate level of decentralization will vary based on the specific context and goals of each organization.

Corporate Headquarters Considerations

In addition to the government, corporate headquarters are also reconsidering their locations, with several key factors driving this trend:

1. Cost Savings and Taxes: Relocating from expensive areas can lead to significant operational cost savings.
2. Talent Acquisition and Retention: Moving to areas with better schools and lower living costs can attract and retain top talent.
3. Improved Quality of Life for Employees: A better living environment can lead to increased job satisfaction and productivity.
4. Access to Diverse Workforce: Diverse populations and regions within the USA provide access to a wider talent pool, fostering innovation.
5. Enhanced Business Environment: Favorable business climates with lower red tape and regulations which stimulate growth and innovation.
6. Infrastructure and Connectivity: Better infrastructure improves logistics and supply chain efficiency.
7. Community Engagement: Opportunities for engagement enhance a company’s reputation.
8. Environmental Sustainability: A focus on sustainability aligns with corporate responsibility trends.
9. Real Estate Investment Potential: Lower real estate costs offer investment opportunities.
10. Reduced Risk Exposure and Insurance Costs: Lower crime rates reduce security risks and insurance costs for employees, assets, employee homes and cars.

Ultimately, the decision to relocate government agencies or headquarters involves a careful evaluation of various factors, including financial considerations, employee well-being, operational efficiency, and long-term strategic goals. Further, is common sense that governmental bodies, human capital and assets should be spread out in the USA due to terrorism or other types of cyber attacks.

In conclusion, the debate surrounding centralized government and corporate headquarters highlights the importance of considering the economic, social, and political implications of location decisions.

The USA could save trillions of dollars over the next 30 years simply by spreading out more of its workers, buildings, assets, and facilities. Decentralization advocates argue that dispersing power and resources can lead to a more resilient, efficient, and accountable system. However, striking the right balance between centralization and decentralization remains a crucial challenge in ensuring the well-being and effectiveness of government and corporate entities.

_______________

Commissioner George Mentz JD MBA CILS CWM® is an international lawyer, speaker, educator, tax-economist, and CEO of the GAFM Global Academy of Finance & Management ®. The GAFM is a ESQ accredited graduate body that trains and certifies professionals in 150+ nations under CHEA ACBSP and ISO 21001 standards. Mentz is also an award winning author and graduate law professor of wealth management for a top U.S. law school.

Citations:

1. Council for Community and Economic Research (C2ER). (2021). Cost of Living Index. Retrieved from https://www.coli.org/
2. National Center for Education Statistics. (2020). The Nation’s Report Card: 2019 Mathematics and Reading Assessments (NAEP). Retrieved from https://nces.ed.gov/nationsreportcard/
3. Texas A&M Transportation Institute. (2021). 2019 Urban Mobility Report. Retrieved from https://mobility.tamu.edu/umr/
4. New York City Department of Finance. (2021). Property Taxes. Retrieved from https://www1.nyc.gov/site/finance/taxes/property-taxes.page
5. National Conference of State Legislatures. (2021). District of Columbia Voting Rights. Retrieved from https://www.ncsl.org/research/elections-and-campaigns/district-of-columbia-voting-rights.aspx