Thom Reilly: Intermountain states must unite, seek federal help

Thom Reilly

Monday, Sept. 1, 2008 | 2 a.m.

Today’s guest Where I Stand columnist is Thom Reilly, who oversees the Harrah’s Foundation and is the former Clark County manager.

A recent report by the Brookings Institution, a Washington think tank, suggests the southern Intermountain West states — Arizona, Colorado, Nevada, New Mexico and Utah — should team up, flex their collective political muscle and together insist the federal government work more helpfully with them to create more sustainable, deliberate policies to empower their growing urban areas. There is much to commend in this report.

I have long thought that Nevada’s alignment with California made little sense when dealing with the federal government. We don’t have much in common, except a border, and given the size of California’s congressional delegation and the sheer complexity of its problems, we are overshadowed and more of an afterthought with the federal government.

Instead, the commonality of the rapidly evolving political, cultural and economic activity of the Intermountain states creates a unique opportunity for future economic success and newfound political clout.

The report is not suggesting a handout from Washington. Instead, Brookings argues that Washington should simply do its job in providing the kind of basic rules, tools and resources that will allow Southern Nevada and other “megapolitan” urban areas to craft their own solutions to maximize prosperity.

For example, the report correctly points out the need for a set of coherent and strategic federal policies when dealing with such critical issues as underdeveloped transportation networks, uncertain water supplies, transfer of and appropriate use of federal lands, and the demand for alternative sources of energy.

And what they “ask” of Washington is as much that it provide the right frameworks as that it write more checks. For instance, despite the impressive accomplishments of our water czar Pat Mulroy, the precariousness of water supplies in the Las Vegas Valley will continue without the political will of the federal government to facilitate a more equitable allocation of Colorado River water among the seven states.

Likewise, without federal leadership, our economic livelihood will be in jeopardy because of the need for improved interstate connections and mass transportation connecting us to California, Arizona and elsewhere.

However, it is the portion of this report dealing with human capital, specifically immigration and widening income disparities, that underscores the desperate need for federal leadership.

The absence of a balanced, comprehensive immigration program has proved disastrous for the Intermountain region, particularly the Las Vegas Valley. Unfortunately, there is nothing on the horizon being developed in Washington that will alleviate this. The report correctly points out that immigration reform must be the responsibility of the federal government.

Who ultimately is allowed to legally cross the borders and reside in this country, as well as the required paths to citizenship, is the national government’s domain. But Washington has developed a set of conflicting and unworkable policies. For example, federal social service, medical and income maintenance programs prohibit access by residents not admitted to this country legally, leaving local and state governments to grapple with the public service costs.

Although the U.S. government prohibits any federal assistance for medical care to this population, it simultaneously requires local and state governments to provide access to medical care through their emergency rooms, with no reimbursement.

Forcing people to wait until their medical condition becomes urgent before care is provided is ludicrous — it is the worst way to address the health care needs of this population and the most expensive. Furthermore, the costs associated with these failed policies leave little room in the public sphere to discuss any benefits (real or perceived) of immigration.

Bridging the gap between wages and living costs of vulnerable families is another area begging for federal leadership. But Congress made it its No. 1 priority during the past year to raise the federal minimum wage and the president’s was to issue an “economic stimulus payment.”

Unfortunately, neither one of these actions will provide any real poverty reduction. If Congress is serious about fighting inequality, its top priority ought to be intellectually tougher debates than raising the minimum wage. Similarly, money directed toward the tax rebate could have been more effectively channeled into real programs that benefit working families.

The Brookings recommendation in these areas is right on — expanding and modernizing the Earned Income Tax Credit. The EITC is a refundable tax credit that supplements wages and offsets taxes paid by low-income workers. It is the most effective tool for lifting families over the poverty line. Each year, it moves close to 5 million people, including 2.7 million children, out of poverty. The EITC lifts more children out of poverty than all other means-tested programs combined.

Empirical studies have shown the EITC to be the most significant contributor to the recent decrease in welfare and the recent increase in employment, the labor supply and earnings of female-headed households. But while this is the most effective poverty-reducing program in existence, it is also the most misunderstood and complex.

The recommended expansion includes increased benefits for childless workers, dual-income couples and families with more than three children. Unfortunately, raising the minimum wage and giving tax rebates are populist issues and make for good campaign slogans. Implementing real and lasting solutions that make a difference defies feel-good slogans and seeming quick fixes.

Forging a meaningful federal partnership with the Intermountain West will require a good deal of increased regional cooperation and coordination among the states. However, the willingness of the federal government to work closely with states and put aside partisan gamesmanship will make the real difference.

In October, the Washington-based think tank will bring its intellectual resources to the Las Vegas Valley to engage Nevada in this important and timely discussion. UNLV will host the event. I hope the community takes this opportunity to engage.