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David Paterson and a hint of fiscal responsibility

David Paterson is the governor of New York State. He is a Democrat. And he recently gave the state legislature $1 billion worth of suggested budget cuts and told them to agree on $600 million worth from that list - something Republicans like to claim is their forté, despite the way government continues to grow on all levels, even when under Republican control. Paterson has ruled out tax increases ("for the time being"), including a proposal by Democrat legislators to hike income taxes of those making over $1 million. Even to talk the talk on this point is a big deal for a Democrat in the Empire State. But he's facing the reality that the budget deficit is an even bigger deal.

From BusinessWeek:

Comptroller Thomas DiNapoli said Paterson's proposed cuts come when "New York State is facing serious fiscal challenges and spending well beyond our means."

Always a problem, right? And the solution is pretty obvious, right? What would your business or household do?

So Paterson's proposed cuts are going over about as well as you might think they are, meaning that lawmakers have ranged between opposing him and being shrewdly mum, while special interest groups and various unions have been outraged.

It's been suggested that "The pieces are in place for a big deal or near-big deal" in Patterson's emergency economic session that will begin this Tuesday. I don't know how promising to find that, considering that the state Assembly has gone for "no deal" before.

Who would feel the brunt of the cuts Patterson proposes?

He seeks cuts across the board in most funding areas including health care, nursing homes, the City University of New York, economic development, aid to local governments, and anti-crime programs. Exempt is school aid.

Even despite that last point, the teachers union is incensed over a property-tax cap that would limit annual increases to 4% or 120% of the consumer price index, whichever is lower.

I'd like to offer my encouragement to Governor Paterson, because he is proposing steps in the right direction, and he is doing so in the face of fierce opposition and at his own political peril. New York legislators seem to be completely out of touch with reality on where the money will come from. Consider the following points from the Newsday/AP article I linked:

Senate Majority Leader Dean Skelos also wants the state to collect state taxes on cigarettes sold by Indian tribes to non-Indians. He says it's worth at least $400 million.

They've tried that before, and they couldn't make any headway because the tribes won't cooperate. You can get all internet-tough-guy if you like, but we're not about to build a fence around the reservations. Enforcement would be more costly than it would be worth.

The Assembly wants to keep New Yorkers from choosing between heating their homes this winter and eating. That will cost $550 million to increase the Home Energy Assistance Program to meet the rising cost of heat for low- and moderate-income families. The Assembly would make oil companies pay for it.

Out of their profits, I assume? Sigh. Corporations don't pay taxes, you morons. Customers do. Always. Every time. Period.

Maybe Governor Paterson can give the legislators a quick lesson in basic economics. Maybe he can convince them to face reality. If so, I hope politicians across America are taking notes. Posted by Wulf on August 16, 2008 at 02:46 PM

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