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Albany may be following California's example

Is New York becoming California?

If there is a poster child of a state hit hardest by the recession, it is California. For a year, the state government has hit its work force, taxpayers and every range of social program to ring savings out of its stumbling budget.

For his part, Gov. David A. Paterson has been warning that unless real cuts were made to the budget here, New York would feel the pain California has gone through.  With word that New York's deficit has now climbed another $2.2 billion in just the course of one month to $16.2 billion, the Empire State has a better-than-average chance of going the way of California.

What could be the effect?

For starters, big spending cuts are expected, as are big tax hikes. But if the Democrats who now control the governor's office and the Legislature in New York make the wrong decisions in the days ahead as they lead up to adoption of a 2009 budget, the consequences could be long lasting.

Will they turn to "creative" borrowings to fund things today that won't be paid back for a generation? Will they implement one too many solutions derided as gimmicks that, when combined with the sour revenue numbers, lead Wall Street agencies to lower the state's credit rating -- further driving up borrowing costs for years go come? Will real reforms be instituted -- such as combining government functions to reduce duplication?

Frustrated rank-and-file lawmakers privately fear Paterson and legislative leaders are on the verge of missing real opportunities to take advantage of the fiscal crisis to end some of the much-criticized ways Albany spends and taxes.

"It's the worst I've ever seen it here," one lawmaker said Tuesday. But, will it be even worse after the budget is adopted?

-- Tom Precious


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