Will the recent promising trends in some of the leading economic indicators fail to provide practical and political relief to the American people? Unfortunately, it's easy to visualize that exact scenario.
Look at state governments, from California to Alabama. They are leading an emerging trend that finds statehouses looking more like poor houses. As the federal government tries to fight terrorism and rebuild Iraq, the burden of providing essential services to Americans is increasingly falling on the states. More and more, those states can't pay for them. As governors and legislators face elections next year, many of them are confronted with unpleasant and unpopular budget solutions, such as tax hikes or cutting critical services like health care, prisons, transportation and education.
Politically the problem is simply stated, though not so simply solved: polling numbers show neither higher taxes nor fewer services is acceptable to the public. That's because too many people have come to view government as the ultimate guarantor of everything from a good education to daily spending money.
This may sound like the same old shrill conservative critique of "give away" government as the bane of modern public life. Even so, it's today's reality, as is the fact that many voters who call themselves conservative or moderate expect these services as much as anyone. That's what creates the potential for the public to be less understanding of a statistically valid "economic recovery" than might normally be the case.
Keep in mind that it might take months of economic recovery before state coffers feel the boost. As a result, many governors and state lawmakers in the coming year will avoid even the appearance of an unpopular tax or fee increase and instead find ways to "cut waste" from their budgets. Inevitably they will discover, however, that one person's waste is another's fiscal sacred cow.
For example, many high growth states have allocated funds to purchase and protect land as an effort to preserve pristine real estate, or "green space." Some conservatives consider this to be a non-essential service. They should think again. Polling consistently shows that among moderate Republicans, especially women, preserving the environment is one of their top three public policy priorities. Some elected officials next fall may avoid being accused of raising taxes, only to be accused of voting to destroy the environment.