Southern states urged to focus long-term

CHAPEL HILL, N.C. — While the recession technically may be over, unemployment across the South remains high, states are facing gaping budget chasms, and demographic shifts are changing the makeup of the region’s workforce.

These trends mean policymakers in southern states must forego short-term fixes in favor of long-term policies that create broader economic opportunity for all residents, says the State of the South 2011, a report produced by think-tank MDC Inc.

Eleven of 13 southern states face budget shortfalls running as high as $113.4 billion for fiscal 2012, the report says, and lawmakers have put obvious efficiencies and cuts into effect in previous years.

Now, leaders must decide if and which state programs to cut.

At the same time, aging baby boomers are facing retirement while the region’s incoming supply of workers is increasingly minority and immigrant, two populations less prepared for the new economy.

“It is imperative that the South sustain efforts to close educational achievement gaps and assure that tomorrow’s more diverse workforce has the skills to thrive in a high-tech, high-wage, knowledge-centered economy,” the report says.

As lawmakers in the region turn to balancing their budgets, the report urges them to base their decisions on long-term goals of equity, opportunity and economic competitiveness.

“Guidance by this definition of a ‘north star’ would impel governors, legislators and other policymakers to assess budgetary decisions by whether they would narrow inequities, create opportunities, enhance mutual regard and generally widen the circle of successes and wellbeing,” the report says.

To do that, policymakers should ask themselves the following questions:

  • Toward what outcome are we aiming, and what outcomes are fundamental to the post-recession health of our society?
  • What can we create that will serve the dual purposes of creating jobs and improving physical public assets?
  • What transformational policies and plans can we set in motion as recovery proceeds?
  • What past gains can we not afford to sacrifice as we build for the future?
  • How can we not only salvage what we can, but reset our course?

“While cuts appear inevitable, an across-the-board, cut-only ‘strategy’ won’t do,” the report says. “In fact, that’s no real strategy at all. Better is a mix of budget reductions, critical investments and revenue increases, all guided by a ‘north star’ for setting priorities.”

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