V15 N6 Thursday, Sept. 17, 2009 2011 recession shock for city halls Lag time for revenues will come just in time for elections By BRIAN A. HOWEY INDIANAPOLIS - Even in the good times - 2007 when the Great Recession was still two years in the offing - mayors who had helped bring home the bacon lost re-election bids. Greensburg Mayor Frank Manus helped land a Honda plant, Anderson’s Kevin Smith brought in Nestle, Jeffersonville’s Rob Waiz landed MedVenture, and Franklin’s Brenda Jones-Matthews ushered in Japanese compa- nies Nishima and KYB. They all lost re-election bids. In all, 15 incumbents fell in the November 2007 elec- tions, following the 11 that lost in the primary. Many of these mayors lost due to local mayors like Greg Ballard of Indianapolis, Duke Bennett of issues and sensitivities. Some, like Indianapolis’s Bart Pe- Terre Haute and Jonathan Weinzapfel of Evansville will be terson, got caught up in the early property tax storm. pondering re-election. If you think 2007 was brutal for mayors, just wait The home price index that fell by 1.1 percent in until 2011. Purdue University Prof. Larry DeBoer recently 2009 that will be reflected in assessed values won’t be felt surveyed the impact of the Great Recession of 2009 in until 2011. Home prices rose an average 4 percent in 1985 a web seminar and the true impact won’t be felt by lo- and 1 percent in 2008, but fell to a 1.1 percent increase in cal units of government until 2011, around the time that Continued on Page 5 Tack to the center? By BRIAN A. HOWEY INDIANAPOLIS - Last Oct. 8, when candidate Barack Obama had a rally at the Indiana State Fairgrounds grandstand on a glowering, misty day, I found myself perched on the media stand. A voice called out my name “Melvin Simon was an incompa- and there at the base of the grandstand was a friend. He wanted to hand his camera to me so I rable business and civic leader not could click off 10 or 12 photos from my vantage point. only in our state but in our I was pleased to oblige. The two country. His loss will be felt every of us heard Obama say a few minutes later, “This country is being tested in day.” a way we haven’t seen in a century. Future generations will judge us on how - Former Gov. Joe Kernan we respond to this test. Will they say HOWEY Politics Indiana Page 2 Weekly Briefing on Indiana Politics Thursday, Sept. 17, 2009 this was the time when Howey Politics man Max Baucus America lost its way unveiled an $774 Indiana and its purpose? When billion health-care we allowed our petty reform plan. It is a nonpartisan news- differences and broken would require most politics to plunge this letter based in Indianapolis Americans to carry country into a dark insurance, bars and published by NewsLink and painful recession? companies from ex- “Or will they cluding people with Inc. It was founded in say this will be one of pre-existing condi- 1994 in Fort Wayne. those moments when tions. It does not American overcame?” call for an govern- Obama continued. ment-run insurance Brian A. Howey, publisher “When we recognized option. It does set Mark Schoeff Jr.,Washington the common stake we up a consumer- have in each others Jack E. Howey, editor owned cooperative success. This is one to compete with Beverly Phillips, associate of those moments. I insurers. It would editor realize some of you “not add a dime” to Katie Coffin, intern are cynical, fed up the deficit. It seeks and even angry at to rein in costs. your leaders. You have “The cost of Subscriptions: every right to be. I ask you to believe in America’s broken health care system yourself.” $350 annually HPI via e-mail; has stretched families, businesses and This exchange became a poi- the economy too far for too long,” $550 annually HPI & HPI Daily gnant memory for me. My friend is now Baucus said in a statement. “For Wire. battling brain cancer. too many, quality, affordable health Call 317-627-6746. This debate on health care has care is simply out of reach. This is a long been personal for me before I unique moment in history where we Howey Politics Indiana even heard of Barack Obama: When I can finally reach an objective so many 6255 N. Evanston Ave. was denied coverage due to a pre-exist- of us have sought for so long.” Indianapolis, IN 46220 ing condition; Continually rejected for Last week, Health and Hu- health insurance; When during a three- man Services Secretary Kathleen year period my tiny little business paid Sebelius released this Census data Contact Us close to $40,000 on a COBRA plan. on Indiana: The number of uninsured www.howeypolitics.com Or when my friend is facing has increased from 669,000 in 2001 not only an intense personal battle, but [email protected] to 772,000 in 2008. The percent of a potentially crippling financial one as non-elderly adults without insurance Main Office: 317-506-0883. well. increased from 13.8% to 17.4%. Howey’s Mobile: 317-506-0883. Over the past couple of weeks, Private coverage is eroding under the Indianapolis Fax: 317-254-0535. the health care reform debate has status quo. The percentage of people pulled sharply away from the House with employer-based coverage de- Washington: 202-256-5822. Bill 3200 that was such a lightning rod creased from 79% of the population Business Office: 317-627-6746. for criticism during the town halls that in 2001 to 70.6% in 2008. And the ©2009, Howey Politics took place across Indiana in August. proportion of workers from Indiana President Obama tacked to the political Indiana . All rights reserved. without insurance has increased, from center during his speech before Con- 13% in 2001 to 16.4% in 2008. Photocopying, Internet forwarding, gress on Sept. 9, vowing not to add Republicans have influenced faxing or reproducing in any form, “one dime” to the federal budget deficit. the Baucus bill, which is drawing fire in whole or part, is a violation of With that statement, it essentially killed from liberals who wanted the public HB3200, though many of the TV ads option, and conservatives like Chris federal law without permission from against the reforms still cite it as fact. Chocola and the Club for Growth the publisher. A week after Obama’s speech, who called it “every bit as lethal as Senate Finance Committee Chair- the government-run plan so loudly HOWEY Politics Indiana Page 3 Weekly Briefing on Indiana Politics Thursday, Sept. 17, 2009 denounced across the nation last month.” cans will embrace his arguments about health care reform. There are many details that are in flux and the Even more likely is that they will remain skeptical of the Baucus Senate Finance plan still must pass that committee price tag. Even the latest and most moderate version - the and be merged into a Senate Health, Education, Labor and Senate Finance Committee bill - weighs in at $774 billion. Pensions Committee bill that passed last July. True, the Congressional Budget Office says that the bill will These new developments moving toward the cen- reduce the deficit by $49 billion over 10 years. But to most ter are finding validation here in Indiana. “I can’t think of people, $774 billion is a huge price tag. It’s similar to the anything that the president said that I didn’t like, but then $700 financial market bailout last fall and the $787 billion it’s all in the details,” U.S. Rep. Brad Ellsworth, D-Evansville, stimulus. said. Ellsworth is a Blue Dog who noted Obama’s assur- Indiana Democrats in the House and Senate will ances that his plan would not add to the deficit or sanction have to decide whether Hoosiers are abortion. comfortable with that kind of mon- U.S. Sen. Evan Bayh met ey on top of all the government with Obama the day after his ad- spending that has occurred over dress and said, “I told the President the last year. But there’s a more that the primary focus for moderates important calculation for Reps. Joe is getting costs under control for Donnelly, Ellsworth, Baron Hill and middle-class families and small busi- Bayh. nesses, and passing fiscally respon - The final version of health sible reform that reduces the federal care reform is many weeks away. deficit over time.” The Senate bills and House bills On Wednesday, Bayh said have to be merged in each cham- on MSNBC that a health bill had a ber and voted on. Then there will “better than 50/50” chance of pass- be a House-Senate conference ing. Asked about the public option committee. It’s hard to tell at this concept, Bayh explained, “I’ve had point who will emerge victorious an open mind on that from the begin- - moderates like Sen. Baucus, D- ning and I still do. Normally in our country we like the free Montana and chairman of the Senate Finance Committee, market system to efficiently allocate resources. Now from or traditional liberals like House Speaker Nancy Pelosi. time to time when you have a natural monopoly the gov- If Indiana Democrats go too far out on a limb ernment steps in to regulate that so they don’t gouge con- supporting health care reform, they may have to decide sumers, and if you have to use the anti-trust laws or other whether to swallow the bill that is finally produced.