I think the analogy there is pretty inaccurate:  businesses <i>do</i> cut back on services they offer when their revenue decreases.  If business A loses half their revenue, it's probably because they've lost half their customers, meaning they're now only providing half the services.  In the worst case, they go out of business and no longer provide any services at all.<p>If a city government loses half their revenue, though, they're still expected to provide exactly the same services to the same number of people as before, and everyone cries bloody murder when services are cut, assuming that there must be something else to cut instead.<p>Logically, the analogy doesn't add up.<p>I totally agree that the incentives for government to be capital-efficient are very difficult to align properly, but I just don't buy the comparison to how a business is run.