By ©2024 Sarah Becker

Finally, the 2024 Presidential election is behind us. A winner has been declared, and in theory we can “become one people.” According to Pew Research most population sub groups, about eight-in-ten registered voters listed the “economy: inflation and affordability” as their top election issue.

I leave the candidates construal of the American economy to author Charles Dickens to explain. You remember A Christmas Carol, Dickens 1843 description of the divide between concentrated wealth and intensifying poverty. His portrayal of Ebenezer Scrooge as a wealthy miser and Bob Cratchit an overworked underpaid clerk.

Distribution of a family’s wealth, a nation’s wealth is a fundamental economic concern. Billionaire Bill Gates, “guided by the belief that every life has equal value,” created a charitable foundation. Deceased actor Danny Thomas founded St. Jude Children’s Research Hospital. Unlike Gates and Thomas, Scrooge ignored others pleas for charity.

The 2024-2025 Calendar is turning and Alexandria’s Dickensian dialogue continues. As of 2022, 24.1% of Alexandria residents—that is approximately 38,000 people—“were born outside of the country.”

“My opinion, with respect to emigration is that except of useful mechanics—and some particular descriptions of men—or professions—there is no need of extra encouragement,” President George Washington wrote Vice-President John Adams in 1794.

Washington preferred emigrants not “settle in a body” nor “retain the language, habits & principles (good or bad) which they bring with them.” He asked that they “intermix [and] get assimilated” instead.

“Cities’ demographic makeup and economic conditions can demand increasing expenditures on such things as education tailored to a large immigrant [and non-native speaking] population, or costly crime prevention efforts in high poverty neighborhoods,” the Brookings Institution agreed. Alexandria city’s FY 2025 budget priorities: “education, improved city services, public safety and mental health services, affordable housing, and a 2.5% increase in the real estate tax rate.”

The property tax is an ad valorem tax, a tax derived from an article of assessed value. It tends to be progressive—in that expensive property is generally owned by wealthier families, families who pay a disproportionally larger share of property taxes.

Alexandria city’s FY2023 Real property tax income was 36.6% of the city’s budget, the Commercial property tax 23.9%. When taken together, property taxes comprised 60.5% of the city’s income. Budget shortfalls, the resulting property tax increases irritate.

Alexandria is a city dedicated to one-party control. By comparison, the two-party Congress is conflicted. It has yet to politically recover from House Speaker Mike Johnson’s September shutdown sham, his failure to acknowledge the forthcoming expiration of the 2017 Tax Cuts and Jobs Act [P.L. 115-97]. “Millions will see their individual tax rates rise” when the legislation expires.

If the economy is to enjoy the fruits of specialization, better planning is needed. Resources are scarce and consensus is pretty much yesterday’s news. In mid-September the U.S. Federal Reserve lowered interest rates, for the first time in 16 years. Am I not impressed? The question asked it seems Federal Reserve Chairman Jerome H. Powell has remained above the political fray.

It was President Woodrow Wilson [D-VA, 1913-1921] who made the establishment of the Federal Reserve a legislative priority. He signed the Owen [D-OK]-Glass [D-VA] Federal Reserve Act into law on December 23, 1913. Wilson himself negotiated the complex compromises: the nearly straight party-line voting needed to create a permanent central bank.

Wilson’s “New Freedom” agenda guaranteed him the Progressive label. He expanded the executive branch not only with the creation of the Federal Reserve, but also the Federal Trade Commission and the Internal Revenue Service. The President’s plan generally: banking; tariff [the 1913 Underwood-Simmons Tariff Act, “the first tariff improvement since the Civil War”], and labor reforms. Reintroduction of the federal income tax also. For more information regarding tariffs visit oldtowncrier.com/2018/08/31/tariffs-then-now/.

Conflicts of interest spoiled previous attempts to stabilize U.S. monetary arrangements. Tensions between the farmers and trades people of Main Street who believed that they were most advantaged by politics of easy credit—and—the financial barons of Wall Street who, as creditors and bondholders, preferred hard money or low inflation policies.

Inflation: A decline in the value of money: an increase in the money cost of a collection of goods.

The current annual inflation rate is 2.4%, the lowest since February 2021. Wage growth is outpacing inflation. The downside: only about 6% of the nearly 600 items the Bureau of Labor Statistics tracks are cheaper today. It is the latter some say that decided the November presidential vote.

It was presidential candidate Bill Clinton’s 1992 campaign manager James Carville who invented the phrase “It’s the economy, stupid.”

“In 1992—George H.W. Bush’s presidential year [R-TX, 1989-1993]—10 million Americans were unemployed, the country faced record deficits [$352b.], and poverty and welfare rolls were growing,” the National Archives reminded. “Family incomes were losing ground to inflation and jobs were being created at the slowest rate since the Great Depression [1929-1933].”

President Clinton [D-AR, 1993-2001] was sworn into office on January 20, 1993. He and Vice President Al Gore [D-TN] “launched their economic strategy soon after,” the Archives continued. (1) Establishing fiscal discipline, eliminating the budget deficit, keeping interest rates low, and spurring private-sector investment; (2) investing in people through education, training, science, and research; and (3) opening foreign markets so American workers can compete abroad.

“After eight years, the results of Clinton’s economic leadership were clear,” the Archives concluded. “Record budget deficits became record surpluses; 22 million new jobs had been created, unemployment and core inflation were at their lowest levels in more than 30 years, and America was in the midst of the longest economic expansion in its history.”

Also in 1992: the U.S. House of Representatives voted against a Balanced Budget Amendment to the Constitution. Balanced budget, a program of government expenditures precisely financed by government revenues for the same period. If passed the Amendment would have further constrained government spending. Higher spending typically requires higher taxes.

Clinton’s successor, incoming President George W. Bush [R-TX, 2001-2009] claimed his budget blowout was incurred during the country’s 9/11 episode. 9/11 is shorthand for “four coordinated terrorist attacks carried out by al-Qaeda on September 11, 2001.”

Thirteen days before President Barack Obama [D-IL, 2001-2009] took the oath of office the Congressional Budget Office forecast a total 2009-19 budget deficit of $4.32 trillion. Instead, the decade ended with cumulative deficits of $8.93 trillion—more than twice as large as projected. The last two years increase was attributable to Obama successor President Donald J. Trump [R-NY/FL, 2017-2021]. Trump’s four-year deficit: “almost $7.8 trillion.”

As of October 2024 the country’s national debt totaled $35.69 trillion. Government spending and the taxation needed to finance it, touches the lives of every American citizen. The 2024 deliberations may be over, but budget debates will continue: in Congress, in State legislatures and Alexandria’s City Council.

It really “is the economy, stupid.” Economic growth included. Alexandria’s 1983 political placement, development and marketing of the Braddock Road island-platform Metro Station is an example. Like Scrooge, Alexandria prefers the 1834 “Poor Law” to beneficial reform.

When the Braddock Metro Station’s manager is stabbed on-site; the neighborhood draw remains gun-shots fired, and the surrounding environs flood the accumulated costs are too high. The costs outweigh the economic benefits, the quantifiable gains.

Happy holidays and a prosperous New Year to all!

Sarah Becker started writing for The Economist while a graduate student in England. Similar publications followed. She joined the Crier in 1996 while serving on the Alexandria Convention and Visitors Association Board. Her interest in antiquities began as a World Bank hire, with Indonesia’s need to generate hard currency. Balinese history, i.e. tourism provided the means. The New York Times describes Becker’s book, Off Your Duffs & Up the Assets, as “a blueprint for thousands of nonprofit managers.” A former museum director, SLAM’s saving grace Sarah received Alexandria’s Salute to Women Award in 2007. Email abitofhistory53@gmail.com.