Inequality And The Iron Law of Decaying Public Services | OurFuture.org by People’s Action
Installing a private court, of course, can run many thousands of dollars. In our imaginary suburban county, only a handful of local families — maybe one family in a thousand — have the sort of wealth necessary to afford a private court. Local contractors understand this market reality. Few of them bother offering private tennis court-making services. Private courts remain costly and rare.
But what if wealth in our tennis-loving county suddenly starts to concentrate? What if ten families in a thousand could suddenly afford to think about installing a home tennis court? At this point, contractors might start to take notice. More of them might start hawking court-construction services. Prices for private tennis courts would soon start sinking. A wider circle of affluent households would now be able to afford them.
Those affluent who choose to take the private plunge would, naturally enough, no longer frequent the county’s public courts. They would do all their volleying at home and invite their friends to join them. Eventually, noticeably fewer people are frequenting the public courts.
Local parks officials, in response, start devoting fewer dollars to court upkeep. The courts start deteriorating. Tennis buffs of modest means, disturbed by these shabbier courts, start looking for alternative places to play. A clever entrepreneur notes this burgeoning new market for quality tennis facilities and opens an enclosed tennis bubble. Tennis buffs of modest means quickly begin reserving court time in the new bubble. For a fee, of course.
Back in the public parks, ever fewer people are now playing tennis. Parks officials start ignoring downed nets. Why bother keeping nets up, after all, when hardly anyone is knocking balls over them anymore? The public courts soon start going to seed. They become eyesores.
Over recent decades, government spending in the United States has followed Peltzman’s Law as assuredly as if Congress had enacted it. Spending for public goods and services increased in times of growing equality, in the 1950s and 1960s, and fell significantly in the 1980s and 1990s, when gaps in income and wealth started rapidly growing wider.
In California, America’s middle class heaven after World War II, $1 of every $100 Californians earned in the 1950s went for the commons, for building schools, roads, water systems, and other public goods and services. By 1997, California had become the nation’s most unequal state. In that year, of every $100 Californians earned, only seven cents went for public services. The result: a massive deterioration of the California commons, from schools to roads.