For Albany, the tough times have arrived

      ALBANY -- For his entire seven months in office, Gov. David Paterson has sounded a common warning: bad times are coming.

   Now, they are here.

   The state's deficit for the current fiscal year is now projected at $1.5 billion. That gap must, by law, be closed, and supposedly will be -- and then some, Paterson hopes -- at a mid-November special session of the Legislature. Lawmakers already have insisted midyear cuts to public schools and tax hikes are off the table.

   Then there's next year: another $12.5 billion in red ink. At that point, no one is really flatly ruling out anything. In Albanyspeak, that means the possibilities are endless: big cuts to popular programs, like education and health, or tax and fee increases, or even deals to sell public assets. Officials insist there will be none of the fiscal gimmicks seen before. Recall the "sale" of Attica state prison in the early 1990s by the Corrections Department to an off-budget authority?

   The overriding question, and one that residents in California have already been facing with their state's fiscal crisis, is whether New Yorkers will have the stomach for real spending cuts.

   Will residents be OK with less state aid for schools? What if it then means higher property taxes to make up the difference? Or, if not, what if it means cutting classroom or after-school programs?

   Will New Yorkers be OK with cutting aid to hospitals? What if it means curtailing some health services or dealing with more crowded emergency rooms?

   Or will they, as some lawmakers think, be open to tax increases? What if they are just on the wealthy? And who would the wealthy be -- considering personal income wealth means one thing in Buffalo than it does on Long Island?

   These questions won't be answered for months. There will be an initial test in mid-November
with the special session to close a $1.5 billion current year gap. But the big test comes
early next year for the fiscal year beginning April 1.

   About the only thing that could change the nightmare scenario is if Wall Street -- whose
activities generate 20 percent of the state's revenues -- has a dramatic rebound based on some
cheery economic news in the next couple months. Unfortunately for Albany, the number of
optimists predicting such an event can be counted on one hand.

   -- Tom Precious

Comments

[HapKlein]

We have all been living in the Land of the Lotus Eaters for a couple of decades nationally and at the sate and local level.
Ronald Reagan began the process in the 1980’s and deficit financing of every aspect of American Life has grown to the misshapen monster we witness today.
I note that two areas immediately targeted are health care and education. Naturally cutting here will lead to increased cost later. Cutting remedial and anticipatory medicine means emergency room and surgery and American children already are not the top candidates for the technical world of tomorrow. Maybe Neil Postman had it more correctly than any of us realized and we have had a four decade party and now will just amuse ourselves to death.
Imagine prior to this crisis NYSDOT and county folk warned that thousands of miles of roadways were dangerously substandard, hundreds of bridges are in dangerous shape and even inspections were hopelessly inadequate to gain an accurate picture.
In Albany, the staffs of every agency have grown far beyond any measure of effectiveness and certainly faster than any needs were demonstrated. Every assistant now has a staff of assistants all busy all the time while very little is accomplished.
We have lost our way and the blame can be attributed to an instinct to borrow just to keep things moving. We can point to banks that provided easy access to cash and point to politicians who did not consider the growth of debt would eventually clash with growing needs but mostly we have ourselves to blame.
We elect and re-elect fools to sort of serve our interests and borrowed money to buy big comfortable cars, big TV sets and home entertainment centers and now are all set to be entertained.
I hope not but we may be at the era that we pay the piper.

[Barton Keyes]

An important fact in all this hand wringing and calls for finally facing the music is that the pain would be a lot less if Albany had faced up to their responsibilities when they had to.
Gov. Spitzer and the Legislature knew they were facing a multi-billion dollar deficit when Spitzer took the oath of office. But they simply kicked the ball down the field instead of implementing meaningful cuts. And Patterson failed to veto the inflated current budget that now requires cuts of 2 billion dollars even while he pleaded for restraint.
So what has the delay brought us? Bigger deficits and more pain.
And why is this so? So politicians could avoid hard choices before an election.
Typical.

[Mark]

It seems to be a hard thing to endorse multi-term incumbents for re-election, despite what they might bring home in pork. This problem did not occur in the past three months or three years, more likely three decades. The state legislature can start with all the perks and staff they have in their legislative budgets.

[pgr88]

NY State already spends the most in the nation, by a wide margin, for schools and for medicaire. Why is that?

I am not afraid of across-the-board cuts, but the public-sector, politically favored special interests, like SIEU, AFSCME, etc... certainly are.

[Hank]

This requires a litmus test. The school districts in WNY must merge and eliminate duplications. Lancaster-Depew-Cheektowaga, Williamsville(East, South, and North), Sweet Home and Amherst. The property taxes are driving out residents and prospective businesses.
If the area cannot stomach consolidation here, it is doomed to tax and fee increases and borrowing costs that stagger the imagination. The County Government itself should be eliminated. Start with schools. I'm betting it won't be done, as New Yorkers, residents, government employees, unions fail to see the wool was pulled over their eyes over the last 30 years. And stop interviewing the very people that caused it.

[pgr88]

Here is a very instructive article to the mind-set of our politicians.

- Gov. of NY Paterson calls for immediate Federal Aid
- Gov. of South Carolina Sanford does not ask for Federal Aid, and says instead the Gov't should stop trying to solve problems by throwing money at them.

http://ap.google.com/article/ALeqM5jGcBHvnIaKwyq-VPObjMSdZvM4fgD944AJLG0

[tom]

HapKlein

Reagan started the process of large deficits ? I have no great admiration for Reagan but I do respect the truth. The truth is the really big budget bleeding began under LBJ who expanded the Vietnam War while also funding his "great society" program. As I recall, Nixon doled it out with both hands as well.

The last New York State governor worthy of the job was Hugh Carey. Beginning with Cuomo New York ratcheted spending way out of control. It was Mario who had the Attica prison gimmick the article refers to. The man was an unmitigated disaster followed by Pataki and Spitzer who were complete frauds.

This country is in a financial mess and we are having to face this challenge with a stupid, spoiled, selfish, and ignorant electorate led by "leaders" who are only in it for what they can steal. What a country !!

[Joan]

pgr88 - Your South Carolina verses NY comparison is meaningless & it fails to see the larger picture. New York clearly needs to make deep cuts, but it also makes sense for us to ask the feds for some of the extra money that states like NY have been paying out all these years to support & subsidize states like South Carolina! Throughout much of "blue state" America, particularly in North Eastern states & states on the West Coast, a handful of states have been paying out more in federal taxes than we received back in benefits & funds from the feds., while many "red states" in the South & mid-West have gotten back more in federal funds & benefits than they pay out. It's a fact. For decades, states like NY have been paying out more than our fair share to subsidize the budgets of under-paying states, like South Carolina, who pay out less than they receive from the federal government. In the midst of our own state crisis, it's only fair that some of that extra fed money should come back to states like NY & California. States, like South Carolina, are already getting MORE than their fair share from the feds. Why not let free loader states, like SC, pay more (or at least their fair share) for once!

[Joan]

Here is a link to a chart that shows what I'm talking about (in my post below). You'll note that South Carolina receives about $1.35 from the feds for every $1.00 in federal taxes paid, while New York receives about 79 cents for every $1.00 in federal taxes paid. California receives 78 cents for every $1.00.

[Joan]

oops. Here's the link
http://www.taxfoundation.org/research/show/266.html

[pgr88]

Joan

The statistic you cite is overly simplistic - it includes things like where military salaries are paid, contracts to companies whose factories are actually based in another state. It is basically useless.

The same with the notion that Federal Govt payments to states are the main source of economic growth. Besides, if South Carolina was so good at stealing Federal money from NY, why is their Governor not pushing for even more?

Face it - we have a NY State Govt that puts Gov't spending first. Everything starts with the basic Governing philosophy.

[Barton Keyes]

If the times are tough, where is the tough leader to meet them? Governor Patterson proclaims that the red ink is serious and growing, yet he says he will NOT make any suggestions as to where to cut. He will let the legislature come up with such proposals first.
That is just what we do NOT need: leadership AWOL from the executive mansion.

[wooly]

Only the politicians, giving themselves, their own raises, are singing, ..."I Love New York",...now, that's enough of that singing,...let's get back to raising some more taxes. I'm retiring pretty SOON, and blowing out of this pop stand! It's too expensive to just live here.