US capital pays for its $4bn rescue
Wednesday 15 January 1997
The plan, to be submitted as part of the 1998 federal budget, fulfils Mr Clinton's promise of speedy aid for a city which has lurched from crisis to crisis over the past five years. It was quickly supported by Mayor Marion Barry and most municipal leaders, and is broadly in line with steps advocated by the Speaker, Newt Gingrich, which can only raise the chances of approval by the Republican Congress.
The scheme is essentially a trade-off. The federal government will end its $660m annual grant to the District of Columbia. In return it will take over the massively underfunded $5bn pension scheme for DC employees, as well as the city's prison system, and most of its health care responsibilities to the poor, and spend $1.4bn on Washington's decrepit roads and infrastructure. In all, say White House officials, a modest $339m will be added to the federal budget deficit between 1998 and 2003.
The announcement has been timed to coincide with Mr Clinton's second inauguration next Monday, when America and the world will see the familiar Washington of broad avenues, gleaming public buildings and some of the most handsome urban vistas on earth.
A few blocks away, however, lurks the other Washington, a case study in the problems of America's decaying, predominantly black, inner cities. Thus far this decade alone, 50,000 people - a tenth of its population - have fled to suburban Maryland and Virginia, further eroding a shrinking tax base.
A financial control board imposed by Congress to take over management of the city from Mr Barry is struggling to correct a 1996 budget deficit of $90m. In the first 13 days of 1997, 19 people were murdered in the District. A headline in yesterday's Washington Post proclaimed that DC's infant mortality rate had fallen to a record low of 16 per 1,000 live births. That is still double the national average.
If the plan works, the haemorrhage of people and businesses will be staunched and perhaps reversed. Meanwhile, the federal government's relationship to the capital will be placed on the same footing as a state's to a large city, of Illinois to Chicago, or of Colorado to Denver. In practice however, Washington's limited autonomy will be even more circumscribed.
Before financial difficulties became overwhelming in the early 1990s, the city had dreamed of extending the "home rule" it achieved in 1974 into full statehood as New Colombia, electing its own US senators and congressman. Then came economic downturn, the Barry drug debacle, his subsequent re-election as Mayor, and an ever-accelerating flight to the suburbs.
The White House plan would place many city services under direct control of federal agencies and still leave Congress with ultimate authority for the city budget - seen by many local residents as an injustice comparable to the "no taxation without representation" outcry that boiled over in the war for independence from Britain in 1776.
- 1 Isis 'jihadi bride' claims forced sex with Yazidi girls is never rape because Koran condones it
- 2 Woman accidentally shoots herself in the head while posing for a selfie
- 3 Art Garfunkel calls Paul Simon a 'monster' with a Napoleon complex
- 4 Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
Isis 'jihadi bride' claims forced sex with Yazidi girls is never rape because Koran condones it
Woman accidentally shoots herself in the head while posing for a selfie
Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
16-year-old girl beaten and burned alive by lynch mob in Rio Bravo, Guatemala
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
Scotland may have to leave the EU even if it votes to stay in, David Cameron confirms
The day that Britain resigned as a global power
Almost a third of school pupils believe 'Muslims are taking over our country', study claims
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
Gay marriage 'Bert and Ernie' cake bakery found guilty of discrimination in Northern Ireland
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...
£35 - 40k + Benefits: Guru Careers: We are seeking a Software Developer (JavaS...
£18000 - £23000 per annum + Commission: SThree: As a Trainee Recruitment Consu...