State workers didn’t seem too surprised on Wednesday by Gov. David Paterson’s announcement that the state is in a recession and he wants to freeze hiring.
Employees from the state comptroller’s office, who were on an afternoon break and enjoying the late-July sun, said they admire Paterson’s proactive approach to the state’s financial problems.
Michael Roach, who was just hired at the comptroller’s office a couple of months ago, said if Paterson’s approach benefits New York, it’s a positive move.
“The general consensus is that there will not be layoffs but a hiring freeze,” said Roach. “I like Paterson. I think he has the best interests of New York in mind. His proactive approach is what we need.”
“Cutting state spending and a hiring freeze would be a good idea. It’s better to catch it and deal with it instead of waiting until it’s a bigger problem,” said Margo Lane, who was reading a book on her break.
Paterson’s directive to cut state agency spending also drew positive reactions from elected officials on both sides of the aisle, from U.S. Sen. Hilary Clinton, D-N.Y., to Republican Assemblyman George Amedore, who represents the 105th District .
In a statement, Clinton said: “Gov. Paterson has outlined many of the serious economic challenges and choices facing New York state, which are the direct result of the seven and a half years of failed fiscal leadership by President Bush.
“Under the Bush administration’s watch, the budgets of state and local governments have been pushed to the limits while New York’s families are feeling the squeeze through higher costs for energy, health care and food at the same time their incomes have fallen,” Clinton said.
She said she will continue to work with her colleagues in Congress “to prevent the Bush administration from further shifting the costs for Medicaid, unemployment insurance, energy assistance, infrastructure investments, and job creation onto the budget of New York state and the backs of New York’s taxpayers.”
Amedore, who officially announced on Wednesday that he is seeking re-election, said in response to Paterson’s announcement that it’s about time.
“Finally, we have a chief executive that recognizes we have a problem, and calling back the Legislature for an emergency economic session is the first step to resolving Albany’s spending problem,” he said.
Amedore said he was encouraged by Paterson’s efforts and his idea that “we need to do more with less.”
Assembly Minority Leader James Tedisco, R-Schenectady, said Paterson’s address about the deteriorating condition of the state’s finances is a “wake-up call to the status quo and special interests that put New York on a collision course with financial disaster.”
News that the state’s deficit has grown dramatically, coupled with a significant downturn in revenue, should not come as a surprise, he said in a statement: state government spends, taxes and borrows too much.
The crisis did not happen overnight and has been growing for years, as spending has risen and the state’s credit has been maxed out, Tedisco said.
Controlling spending is only half of the equation, he added. Capping property taxes on homeowners, decreasing taxes on small businesses and reducing energy costs will help grow the economy and increase revenues, he said.
While elected officials applauded Paterson’s straightforward approach, others, including the New York State Public Employees Federation, which represents state employees, were wary about where cuts would be made.
“We understand there will be hardships for the citizens of New York state as a result of the economic downturn, but the state work force or state services should not bear a disproportionate amount of the burden,” said PEF President Ken Brynien.
State agency budgets have already been cut by a half-billion dollars as steps were being taken to restore the state’s ability to provide services to its citizens. Brynien said there needs to be a balance between cost-cutting and additional revenue.
A significant reduction in spending during an economic downturn is not the right way to go, he said.
In a statement, the union leader said he was encouraged that Paterson was seeking the counsel of Joseph Stiglitz, the 2001 Nobel Prize winner in economics, to explore alternatives to service cuts.
An alternative previously suggested by Stiglitz is to place a temporary surcharge on the wealthiest New Yorkers, Brynien said. The state could also save almost a billion dollars by reducing the use of overtime and consultants, according to Brynien.
Karen Scharff, executive director of Citizen Action of New York, said no one denies that the state deficit is real and officials should respond by investing in New York’s future, not by taking away the economic supports working families need.
“Reinstating a tax surcharge on the wealthiest New Yorkers who benefited from the boom and investing in education, health care and real property tax relief will help New York families and stimulate the economy. Budget cuts and political gimmicks like the tax cap will just drive us deeper into crisis,” she said in a release.
Mark Dunlea, executive director of the Hunger Action Network of New York State, agreed and said tax cuts for the wealthy enacted during the Pataki administration cost the state and failed to create jobs or otherwise stimulate the state’s economy, especially upstate.
“The first step to solve the budget deficit should be to cut back on the tax giveaways to the wealthy,” said Dunlea in a statement. “Cutting state spending during a recession will only make the recession worse. The state also needs to take leadership to hold accountable those in the banking community, Wall Street and the political arena that are responsible for the latest financial crisis, this time involving the abuse of housing mortgages.”
Back on State Street, Edna Doney, who lives in Averill Park and works at the state comptroller’s office, said if the state wants to cut spending, it should eliminate hiring temporary agencies and high-priced consultants.
She’s noticed that people who have retired from the comptroller’s office are continuously being called back as consultants, and she questions why others haven’t been trained to fill those jobs.
She remembers when former Gov. Mario Cuomo ordered a hiring freeze: “It will have a dwindle-down effect. They won’t fill certain positions. It won’t mean much change,” she said.