Playing the budget game

Image of Gillian Tett

In the next couple of months, hundreds of people from San Jose, a cash-strapped city in California, will embark on a curious modern experiment. Under the leadership of Innovation Games, a company that runs and organises corporate computer games, San Jose’s citizens will be invited to play with the city’s budget for a day, using pretend “money”.

The hope is that by logging into these computing-cum-budget exercises, residents will become better informed about how their budget and city work. And that, in turn, should make them more engaged in crucial policy choices. Should the city save money by reducing its firemen on trucks? Should it skimp instead on roads? Or should it bite the bullet and raise taxes instead?

“One of the tragic mistakes we make today is that we think of government as being like a company – something we buy services from. But we are all citizens, we all have a responsibility to get involved,” explains Luke Hohmann, head of Innovation Games. “These games help get people engaged – it makes people think about whether they would rather cut police numbers or child health spending.”

A cynic might dismiss this as just a marketing or political gimmick. And San Jose appears to be the first city in the US to do anything quite like this. But, if nothing else, the experiment is distinctly thought-provoking, particularly given the real-life democratic dramas that have played out in America this week.

After all, it is crystal clear that in the coming months almost every level of American government, from Washington to San Jose, will face tough budget choices. However, it is also evident from opinion polls – not to mention some of the daft political rhetoric recently tossed around – that many ordinary voters are distinctly confused about those fiscal choices. Little surprise: the budget numbers are dizzying and a multitude of different issues are being crammed together on one ballot ticket. Thus the question that San Jose is trying to explore is whether there is a better way to get voters engaged? If voters feel they have active choices, will they keep tabs on politicians in a more effective, co-operative manner?

Personally, I like to think that the answer is yes. Just think, by way of illustration, about Switzerland. In the past few years, the Swiss have – almost uniquely in the western world – managed to do a pretty good job of keeping their national and local debts under control. That partly reflects their conservative nature, but another crucial issue is that most Swiss cantons (local governments) operate with a strong sense of active democracy: local voters tend to know where their taxes are going, have a say in how they are being spent – and can decide whether taxes should be raised to fund that spending.

This sense of engagement is helped by the fact that Switzerland is wealthy and compact; it is far easier to run an effective democracy in countries of that size rather than in a messy, sprawling place such as the US. But what is often forgotten is that America shares many elements of the Swiss federal structure; indeed, back in the early 19th century, men such as Albert Gallatin, the Swiss-born former US treasury secretary, played a critical role in creating the modern US financial structure, echoing Swiss lines. And there is no reason why America could not continue to learn from that Swiss example, even today.

At the federal level, Washington might seem unfathomably distant from voters; but municipalities, cities and other tiers of local government could become more like those Swiss cantons. Or, at least, they could if they gave citizens an active sense of engagement and fiscal control.

So it is worth watching what happens next to San Jose. The city has already run two small pilot games that revealed some striking things: voters love their libraries, are surprisingly open to a sales tax and are willing to cut the number of firemen on trucks from five to four (a policy that has now been implemented). Of course, it remains to be seen whether this makes the fiscal squeeze any less painful (San Jose has lost some $680m of its $2.8bn budget in recent years). However, the city’s next “game” in January will be dramatically bigger than before – and towns in New York state, Virginia and Montana are now considering playing the game too.

“At a time of an increasingly partisan environment, what I find hopeful is that this game forces everyone round the table to work together,” Kip Harkness, a San Jose official observes. “This forces trade-offs, it shows there are no easy ‘outs’.” Washington should perhaps take note; and doubly so given the rancorous – and close – result we saw on Tuesday night.

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