On my bike ride this morning, I passed through several of Chicago’s northern suburbs, and I noticed the horrendous condition of many of the roads. Over the 50 miles of riding, I had to pass over pot holes, rough patches, and cracks that are worse than any time in recent memory. Of course, this should not be surprising. State and local governments, who are largely responsible for maintaining the roads, are undergoing severe budget problems — high deficits resulting in large spending cuts. It is quite clear to me that one of the cuts is road maintenance. Now I understand that Illinois roads are never going to be in good shape because of the large temperature swings in the spring, but it is now mid-July, and it is clear that no repair attempts have been made in many of the towns.
There are lots of places that spending has been cut, and repairing roads can probably wait, but this is a great example of what happens in a recession. As the economy becomes depressed, incomes drop, and tax revenues drop, and government coffers empty — leaving the roads in shambles. This affects state governments the most, as local government earn most of their income from property taxes. Local governments are not immune, however, as tax assessments often drop in during recessions, and another large source of income, grants from the state and Federal government disappear.
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