In budget battle, Gov. Cuomo seizes the high ground
The last couple of years, Gov. David Paterson — a liberal Democrat from New York City — pushed through significant state budget cuts. But the effort was clumsy and erratic and it contributed to the collapse of his political career.
Since taking office last January, Governor Andrew Cuomo — a moderate Democrat from New York City — has pushed for even bigger changes.
The budget proposal unveiled yesterday doesn’t just aim to win one-year concessions and spending cuts. It would change the rule-book that governs future budget negotiations.
That’s a terrifying concept to thousands of powerful people in New York state, from hospital administrators to school superintendents.
But unlike Paterson, Cuomo’s approach so far has been pitch-perfect, a mix of humor, self-deprecation, and what appears to be steely resolve.
Naturally, a lot of groups have a lot of legitimate questions about the magnitude of Cuomo’s proposed restructuring.
There are reasonable misgivings about the fact that he plans to close the state’s black-hole budget gap without tax increases.
Those are debates that we need to have over the coming months.
But my sense is that Cuomo has already seized the high ground, framing the narrative in a way that will make life very difficult for his critics.
Yes, it’s possible that some of these cuts will do real damage to our social safety net, possibly too much damage.
But Cuomo has made a strong case that this is an existential moment, when the big question isn’t whether a prison closes or a hospital reduces services.
The question now is whether Albany will remain solvent at all.
He’s also arguing that this is a defining moment for our civic culture, from the powerful public employee unions to lawmakers and local government leaders.
Can they find ways to collaborate and share some of these sacrifices?
This doesn’t mean that Cuomo should have his way in every case. I think strong arguments can be made for a tax increase levied on New York’s wealthiest citizens.
And there are certainly other areas where this budget plan can be improved.
But my guess is the kind of “Hell, no” rhetoric we heard from Governor Paterson’s opponents just won’t fly this time.
That’s a good thing.
Instead of digging in their heels and pretending that we are still living in 2007, the big players in Albany and the North Country should swallow hard and signal to their constituencies that this year at least the game is different.
Tags: Cuomo, nys budget
We don’t need to debate anything, Brian. The budget should be passed as drafted by March 31.
It’s the never ending debates that have gotten us into the mess we are in.
I don’t give a hoot for any of the special interest groups because it is they who are responsible for the mess.
I guess you think Gov. Cuomo seized the REALLY high ground, Pete. :)
–Brian, NCPR
“I think strong arguments can be made for a tax increase levied on New York’s wealthiest citizens.”
Really? We already have the highest tax burden in the nation, should the state raise taxes on anyone? THe wealthy will continue to leave the state if you tax them more. And don’t forget that the millionare’s tax doesn’t expire until the end of the year. So extending it, won’t help until next year.
Good post, Brian. You note Cuomo says “this is a defining moment for our civic culture, from the powerful public employee unions to lawmakers and local government leaders.”
Interesting that Cuomo and Scratchy right now agree that corporations and the wealthy get a free pass during our civic culture’s defining moment. It’s good to be rich.
Also, on the topic of austerity and some real-world results, this is a good read:
http://www.guardian.co.uk/commentisfree/cifamerica/2011/feb/01/economy-economics
oa,
You should note that Cuomo has proposed allowing the millionare’s tax to continue this calender year, bringing billions for this budget year. Others want to extend to until next year, which wouldn’t help this year’s budget a lot.
Irrelevant to NYS’s finances. NYS is constitutionally required to balance its budget, the UK is not. NYS must either “cut” or raise taxes.
We already have the highest tax burden in the nation, why do people keep thinking we have a revenue problem? When you tax the wealthy and businesses more than anyother state does, what do you think will happen? I know, more of them will move to NY so they can pay higher taxes.
“Irrelevant to NYS’s finances.”
Totally relevant to economic impacts, however. A loss of jobs leads to loss of demand, which leads to lower consumer spending, which leads to a loss of sales-tax revenues, which leads to deficits. Oh, which is relevant to NYS’s finances. It’s math. Short-term, as Brian likes to say, and which some people like to say gleefully, this will hurt. And it won’t just hurt the state workers losing jobs.
Just as overspending has consequences, so does cutting jobs. Even hated socialist government jobs. Not being ideological here. Just bringing out some economic reality.
Another read for you, Scratchy, from a Wall Streeter who advocates more taxation and regulation on himself and his brethren:
http://www.pimco.com/Pages/Devils-Bargain.aspx
Highlights:
“Almost a quarter of the 400 wealthiest people on Forbes annual richest list make their money from money, whereas only 8% could make that claim in its first issue in 1982, and probably close to 0% when I first read my economic primer in 1966… As a profession we have failed miserably at our primary function – the efficient and productive allocation of capital: The S&L debacle of the early 1980s, the Asian crisis, LTCM, dotcoms, subprimes, Lehman and the resurrection, instead of the reformation, of Wall Street, are major sins of the modern era of money…”
NYS can cut without layoffing workers by cutting several areas:
1. State and local workers enrolled in the pension system can agree to contribute 3% of salary to their pension;
2. school teachers – especially north country ones- can make health care contributions that are on par with the contributions of state workers;
http://www.cbcny.org/cbc-blogs/blogs/school-districts-should-achieve-substantial-savings-following-state-practices-employ
3. some of the more excessive cadillac features of NY medicaid can be scaled back to the level of scary right-wing states like Vermont and Massachusetts;
4. freeze land and easement purchases for the about-to-disappear Adiorndack Park – I mean just take a drive through 8, 28, Northway, Big Moose, etc. and you’ll see there’s strip mall after strip mall.
I’m all for higher tax and regulation of Wall Street- by the federal government, which has a significant revenue crisis after Obama unwisely agreed to extend the cuts and lower FICA. And I’ld add a 10% surcharge for the superrich and a carbon tax, maybe even VAT. Oh, and scale back the mortgage interest deduction. Very right-wing of me.
NYS, by contrast, does not have a revenue crisis as its taxes are the highest in the nation.
Also, I’m aware of Keynesian pump priming. My point was that doesn’t work at the state level because NY is required to have a balanced budget unlike the UK or US.
I think it is time to get rid of the state and teacher unions.
Do like Ronald Regan did with the Air Traffic Controlers.
Interesting to note that there’s often little choice about belonging to the union. My wife and I each had no choice, the dues come out no matter what. Not fair really, is it?
I would have much less of a problem with being in a high tax state if NYS used those taxes to help eliminate poverty and income disparity, but they don’t do that. We have a real poverty problem in this state with rates of poverty statewide that rate us right up there with states who tax much less, why should we pay the highest taxes in the nation to have a poverty rate that is the same as West Virginia? Why do we have these high taxes without a flagship public university system that rivals places like the University of Michigan or the University of Texas etc.? Our roads and infrastructure should be the best in the nation, are they? What is going on where is the money going? That is what frustrates most people. The bottom line is that I don’t have faith in NYS government to actually use the tax dollars for the public good.