What a difference a year makes. In June 2008, AZ Views reported that “Arizonans have a strong sense of job security, despite the national economic slump and the state’s budget crisis.” That is no longer true, as this edition of AZ Views shows, and Arizona’s economic situation arguably is the best example of the worst case.

Though the Great Recession may be officially over, all is not well in Arizona. Three years after the collapse of a massive real estate “bubble,” the deepest economic downturn in memory exposed and exacerbated one of the nation’s most profound state fiscal crises, with disturbing implications for Arizona citizens and the state’s long-term economic health.

This brief takes a careful look at the Grand Canyon State’s fiscal situation, examining both Arizona’s serious cyclical budget shortfall—the one resulting from a temporary collapse of revenue due to the recession—as well as the chronic, longer-term, and massive structural imbalances that have developed largely due to policy choices made in better times. This primer employs a unique methodology to estimate the size of the state’s structural deficit and then explores the mix of forces, including the large permanent tax reductions, that created them. It also highlights some of the dramatic impacts these fiscal challenges are having on service-delivery as well as on local governments. The brief suggests some of the steps state policymakers must take to close their budget gaps over the short and longer term. First, it urges better policymaking, and prods leaders to broaden, balance, and diversify the state’s revenue base while looking to assure a long-haul balance of taxing and spending. And second, it recommends that Arizona improve the information-sharing and budgeting processes through which fiscal problems are understood—so they may ultimately be averted.

This report follows The Coming of Age report produced in 2002 by some of the principals involved in this project, and published by St. Luke’s Health Initiatives. That research showed that Arizona had much to do to get ready for the baby boomer age wave. The results of Unlocking Resilience from new survey data, interviews, and secondary research indicates Arizona still has much to do to prepare for aging and must make concrete policy decisions about aging.

Arizonans have gained a reputation for their low opinion of government, despite -- or perhaps because of -- the major role played by all governmental levels in residents’ daily lives. This view was reflected in the responses to this segment of the survey, as panelists generally gave low ratings to the government services they were asked to judge. This was especially true of lower-income panelists. But the respondents’ low ratings might not always have been based upon personal experience: Few panelists said they had sought information from government or community agencies. This may be due to the increasing popularity of the Internet as a self-help source, but it could also mean that relatively few residents need the services or know they are available. In any case, more than half of those who did seek information said they were satisfied with the result. Panelists were not dismissive of all collective efforts at social betterment. They expressed high levels of agreement that good community-based programs can prevent many social problems, from drug and alcohol addiction to child abuse and juvenile delinquency. Asked how they themselves would distribute public funds for social problems, most respondents choose programs for children, affordable housing, and health insurance.

Good jobs and good schools—few would disagree that these are essential elements of a secure and rewarding life. Both are also vital components of a healthy society: Good jobs create revenue to support quality schools, which in turn produce a superior workforce to fill those jobs. Based on survey panelists’ responses, most Arizonans seem to feel that they’re doing well on the employment front, but not quite so well concerning education.

When they’re not sleeping, working, or tending to other duties, Arizonans keep busy. From museum tours to farmer’s markets, softball to spiritual quests, they spend their personal time on a wide array of different activities, from high culture to casual pastime. And—little surprise here—they tend to like to do them outside. These findings arise from a survey asking Arizonans about their leisure-time pursuits, leaving it for them to decide what they consider to be “arts and culture” or “leisure activities and pastimes.” In response, 45% of panelists say they regularly attend at least one type of arts and cultural event, and 77% say they say they regularly participate in leisure activities and pastimes.

Majorities of all panelists statewide named crime/public safety as among the chief indicators of “quality of life” and as among the top issues their officials should address. Nearly half said they thought crime was getting worse. But looking beneath these overall views reveals a pair of seeming paradoxes. The first is that, despite their strong concerns about crime, most respondents also said that their own neighborhoods are relatively safe places, and that they felt safe walking alone at night. The second paradox is that, generally speaking, those Arizonans who are less personally liable to become victims seem more emphatic in their concern about crime than those who seem more likely to be victimized.