Improving Urban Governance Through a "Day of Shame"

Thomas Friedman of the New York Times has fallen in love with Singapore’s urban government. He must not be close to Michael Fay. He writes from Singapore; “Trust me, the head of Civil Defense here is not simply someone's college roommate.” What determines whether a nation’s “best minds” rise in public service?

“From Singapore's early years, good governance mattered because the ruling party was in a struggle for the people's hearts and minds with the Communists, who were perceived to be both noncorrupt and caring - so the state had to be the same and more.

Even after the Communists faded, Singapore maintained a tradition of good governance because as a country of only four million people with no natural resources, it had to live by its wits. It needed to run its economy and schools in a way that would extract the maximum from each citizen, which is how four million people built reserves of $100 billion.

"In the areas that are critical to our survival, like Defense, Finance and the Ministry of Home Affairs, we look for the best talent," said Kishore Mahbubani, dean of the Lee Kwan Yew School of Public Policy. "You lose New Orleans, and you have 100 other cities just like it. But we're a city-state. We lose Singapore and there is nothing else. ... [So] the standards of discipline are very high. There is a very high degree of accountability in Singapore."

I FIND this last quote kind of interesting. The United States has hundreds of major cities and mobility is quite high. Roughly 3% of people move across states every year. For younger, college educated people the mobility rates are much higher. In 1991, Joe Gyourko and Joe Tracy published a paper in the Journal of Political Economy where they reported evidence that home prices are lower in cities with high taxes per unit of public services. In English, this means that in corrupt, incompetent cities where government is employing lots of people but not providing basic anti-crime services, garbage pickup, fire protection and other services; they found that home prices were lower. I have always thought that this would provide an incentive for home owners to support urban politicians who could produce public services more efficiently (think of Mayor Bloomberg in NYC). Home owners could enjoy home
price appreciation if the mayor provided public services more efficiently.

This raises the question of who is the median voter in a city? If the median person is a poor, renter then such policies are more likely to persist, this would be a “Robin Hood” equilibrium.

It should be noted that urban crime is much different than flooding risk. Each day urbanites receive new information from the tabloids and just walking around the streets concerning whether their city is safe and whether the urban police are effectively battling crime. High skilled people will move away from a city that they view is unsafe and has a low quality of life.

There is no similar signal about the quality of safeguards that are supposed to inhibit natural disasters from causing major damage. No one individual is going to call in a team of auditors to audit the levee quality. Here the Federal Government could play a role of the “auditor”. Trained professionals could march into each coastal city and judge its investments in protecting the population against the next shock and then issue a “report card” to the local media. This could be like the EPA’s Toxic Release Inventory and create a “Day of Shame” for corrupt mayors.