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Villaraigosa: Washington Must Be Smart About Cuts, Investments in U.S. Cities

January 19, 2012 at 12:00 AM EDT
Bracing for a new federal budget, hundreds of U.S. mayors sought meetings in Washington this week. Their message: don't let cities fall through the cracks. Ray Suarez discusses the challenges local governments face amid a national debt crisis with Mayors Antonio Villaraigosa of Los Angeles and Danny Jones of Charleston, W.Va.
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JUDY WOODRUFF: Hundreds of mayors gathered in Washington this week for meetings at the White House and Capitol Hill, their message: Don’t let cities fall through the cracks.

And to Ray Suarez.

RAY SUAREZ: President Obama won’t submit his new budget blueprint to Congress until next month, but local officials across the country are already bracing for bad news.

As part of the deal to raise the debt ceiling, spending must be capped at $1 trillion. And with the money from the federal stimulus programs drying up, local governments are worried they won’t get the help they need.

For a closer look at the challenges being faced in two different cities, we are joined by Antonio Villaraigosa, the Democratic mayor of Los Angeles, and Danny Jones, the Republican mayor of Charleston, W.Va.

Mayors, welcome to you both.

The Congress' failure to address the jobs crisis is akin to the captain of the Concordia jumping off the ship while the economic ship is sinking. We want to get that ship back on course. Mayor Antonio Villaraigosa, Los Angeles, Calif.

Mayor Villaraigosa, what role does the federal government play in helping you pay your city’s bills?

ANTONIO VILLARAIGOSA (D), mayor of Los Angeles: Well, they should be a partner.

And I think what most mayors across the country believe, and believe strongly, is that the number-one issue facing our cities and the nation is the issue of jobs and the economy. Our metro economies 2012 report came out today, or yesterday. And it was very clear. Ninety percent of the GDP of the nation is generated in our cities, about 85 percent of the jobs.

So we need the Congress and the White House to focus on job creation. I said that the Congress’ failure to address the jobs crisis is akin to the captain of the Concordia jumping off the ship while the economic ship is sinking. We want to get that ship back on course. And the way to do that is with a partnership.

RAY SUAREZ: Mayor Jones, same question. Does the federal government, various kinds of transfer programs, support from various federal departments, help you run the programs that you run in your city?

DANNY JONES (R), mayor of Charleston, W.Va.: It’s always nice when you can get that money, but it’s not a long-term answer to our problems.

When Sen. Byrd was alive, of course, West Virginia and West Virginia cities were able to take advantage of capital projects that he was able to help us get money for. But as far as paying the everyday bills, the problems that cities face across America are bigger and bigger cities.

Obviously, Mayor Villaraigosa would have bigger problems than we do. But the big cities around the country have big problems everywhere. The federal government is broke. And the — 40 percent of the money they get, they have to borrow, the money they spend. And that has to be dealt with too.

I — speaking only for myself, I think that the if the federal government is going to share money with cities and different political subdivisions around the country, we ought to go back to the way it was done in the ’70s, through revenue sharing, and do it equally according to population all throughout the country, and do away with all the specific winner and loser projects, you get this, you get that.

RAY SUAREZ: Starting in 2013, the Congress is going to be under some fairly tight restrictions as a consequence of the super committee’s failure to act.

What are the kinds of things that will be harder to finance because money won’t be flowing back to cities, counties and other kinds of jurisdictions, Mayor?

ANTONIO VILLARAIGOSA: Well, first of all, I actually agree with the basic notion that we have to address the issue of spending. We have to cut this deficit and debt.

Mayors across the country have been cutting and trimming their own budgets. I’ve cut about a fourth of the L.A. city work force. I’ve had to get our city employees to go from 6 percent to 11 percent in terms of contributing to their pensions. We’ve had pension reform in Los Angeles.

What we’d like to see the federal government do is not just cut, however. They have got to invest as well. So they have got to invest in making sure that our roads, our bridges, our ports, our airports are competing with roads, bridges, airports and ports around the world.

They’ve to make the investments that the federal government has always made. You know, every president since Eisenhower, Democratic and Republican both, have supported investing in the highway system, in our infrastructure system. So those are the kinds of investments that they can make while they’re also having to make the cuts that they’re going to have to do at a time of high deficits and debt.

RAY SUAREZ: Have you had to make cuts? Have there been layoffs to municipal workers, for instance?

DANNY JONES: We were put into a pension system by the state we couldn’t possibly pay for. And if left to our own devices, we’d do very well.

And, actually, the state of West Virginia is doing well. We have a civics center that needs repair. So on a — we’re not nearly on the scale as Mayor Villaraigosa. But we have a civic center that needs repair. And if Sen. Byrd was still alive and it was five years ago, we might have been able to get the money from the federal government.

That is not going to happen now. We have to find a way to raise the money. It’s a $40 million problem. We think we can come up with 10. There is some very tough sledding in for this country and for the cities. And the bigger they are, unfortunately, I’m afraid, the harder they are going to fall.

RAY SUAREZ: Well, half the city finance officers surveyed across the country said that ’11 was worse than ’10. What does 2012 look like for you? Do you see the improvements that people are talking about in the economy?

DANNY JONES: The indicators are, it’s a slow rise, but it’s better.

I watch financial channels every day, and it looks better. In the northern part of West Virginia, we’re having natural gas, which is starting to look — which is starting to really do well. Unfortunately, since the Obama administration has come in, coal mines that have permits in southern West Virginia have been arbitrarily shut down, putting hundreds and thousands of coal miners out of work. These are very high-paid jobs.

And this is part of the green movement in our country, which has not been good for southern West Virginia.

RAY SUAREZ: Mayor Villaraigosa?

ANTONIO VILLARAIGOSA: Well, look, the economy is improving, but at a very slow rate.

I think the job growth last year in our 2012 report was about 1.3 percent increase. We know that the economy could be improving to the tune of about 2 percent. That’s nothing to brag home to mama in West Virginia or in L.A. So that’s why we’re here.

We want to partner with the federal government. There’s no question that they’re going to have to be cuts, and there are going to be a lot of them. There also has to be investments. You know, the Republican mayor of Mesa, Ariz. — or second vice president said yesterday, there are smart cuts and there are dumb cuts.

When you cut infrastructure spending that can create millions of jobs, if we don’t pass the surface transportation bill, as an example, we’re cutting our nose to spite our face. If you cut our schools and our work force development programs that can retrain our workers for the jobs in the new economy, those are dumb cuts.

So we believe that the federal government has to be smart about the cuts that they make and smart about the investments that we need to make to make America competitive around the world. That’s what it’s about.

You go to China, Japan, Korea, you go to Western Europe, you go to the developing world, and they’re making those investments in their ports, in their airports, in their bridges, in their roads. We have to continue to do the same thing if we want to compete around the world.

RAY SUAREZ: What impact has the trouble in your state had? I mean, states across the country are reporting difficult times.

DANNY JONES: Those countries he mentioned have taken all our jobs. That’s the reason why they had the money to do all the work that Antonio was talking about. But California is in worse shape than West Virginia.

ANTONIO VILLARAIGOSA: Well, I think, though, in the case of both West Virginia and California and virtually every state in the United States, we always say that the difference between a state, the city and the federal government is, the federal government can print money.

That’s why we’re in — an unlimited fashion — and that is why we are in the problems that we are in. State governments balance their backs — balance their budget on the backs of cities, counties and school districts. We’re the only ones that can’t pass the buck. We actually have to make those really tough choices.

We want Congress to make an easy choice, and that’s invest in job creation, invest in America’s workers again.

RAY SUAREZ: Mayor Villaraigosa, Mayor Jones, gentlemen, thank you both.

ANTONIO VILLARAIGOSA: Thank you.

DANNY JONES: Thank you.