For those who took the state’s leaders (Gov. David Paterson, Assembly Speaker Sheldon Silver and Senate Majority Leader Malcolm Smith) at their word that they would bring a more open process to budgeting, nothing could have been worse than the super-secrecy with which the Democratic “troika” negotiated this year. But while no one can be entirely happy with the final product — closing a $17 billion-plus gap is never going to be pretty — it could have been worse. And the budget is almost on time — a rarity that will at least provide some certainty at a time when it is more needed than ever.
There can be no doubt that these guys wouldn’t have done anything if they didn’t have to — i.e. if they weren’t legally required to produce a balanced budget. That, and the very size of the deficit, ensured that they would have to take some real, painful steps rather than rely on smoke and mirrors and one-shot, nonrecurring revenues, as in the past.
The $6.2 billion in federal stimulus money certainly helped, although, showing how dramatic has been the drop in state revenues, it really only made up for the increase in the deficit from last fall ($12.5 billion ) to now ($17.7 billion, up from $16.2 billion just a week ago).
The stimulus money also ends after two years, which means that if the state’s economy doesn’t substantially recover and receipts increase by then, the deficit will not be temporary but structural and there will be much more cutting to be done.
Another big source of money, a temporary income tax increase on the wealthy, is unfortunate but necessary, and Paterson was right to give up his opposition and side with Silver on this. Without that $4 billion, and another $2.3 billion from various other taxes and fees, the spending cuts would have been too destructive to too many.
But the spending is still too high, an increase of around 9 percent (although nearly all of that is the federal stimulus money). How can the leaders justify continuing with $170 million for member-item pork-barrel spending, particularly at a time when health care is getting hit for $2.3 billion?
And education, which along with health care is by far the biggest part of the budget, has been insulated. It should be remembered that school districts have had big increases in state aid for many years, and huge ones the last two, much of which has gone to teacher salaries and to reducing class size (the latest panacea for improving education, and one that hasn’t really been shown to work). If the leaders were unwilling to take money away from classroom instruction, they should have at least saved some by being less generous with funding for school construction projects and by reforming special education, where districts have too much incentive to classify kids and deal with them in the most expensive manner.
State employees aren’t happy with the 8,900 layoffs (roughly the number of state jobs added in the last two years) called for in this budget. But their unions have the power to prevent the layoffs by forgoing the scheduled 3 percent raise and accepting one-week furloughs, as the governor has asked them to do.
We agree with the critics who say the budget grows too much, taxes too much and does not cut enough structural spending. But in a horrible economic climate, nothing the leaders did was going to make everyone happy. In fact, many people are unhappy, a sign that they have spread the pain around fairly well. New Yorkers need to move on, adjust to the new realities, and hope we get lucky and the economy improves quickly.