In Albany, Budget Battle is the Cuomo Show

Monday, March 28, 2011

New York Governor Andrew Cuomo

Welcome to Politics Bites, where every afternoon at It's A Free Country, we bring you the unmissable quotes from the morning's political conversations on WNYC. Today on The Brian Lehrer Show, Liz Benjamin, host of Capital Tonight and blogger, and Greg David, director of the business and economics program at the CUNY Graduate School of Journalism, talked about the latest with the state budget in Albany.

Governor Andrew Cuomo is sending some rough budget cuts down the pipeline. And he's having a very easy time doing it.

According to Greg David and Liz Benjamin, Cuomo is still riding the tailwind that swept him into office. Despite proposed cuts to education and changes to Medicaid, the governor's approval rating remains above 50 percent. David said that statistic was reflected in the budget battle, where Cuomo is basically having his way.

This was one man in a room. It was practically Cuomo's budget as originally proposed...It seems to me that it's the first budget in as long as I can remember where the governor's proposal got so little change by other men in the room.

"He was very deft at scaring the living daylights out of the legislature," Benjamin agreed.

But maybe not as deft as he could have been, said David. Yes, the governor's appeal seems to have made his austerity measures somewhat palatable, but Cuomo may look back at the budget debate as a missed opportunity to get other pieces of his platform in place. 

Extension of New York City rent regulation bills; the property tax cap; ethics reform is pending, that could have been done in conjunction with the budget; nonpartisan redistricting is pending, seems to me a very important thing. The budget is where the governor had the most leverage. He will have less in coming months on these very important issues.

Cuomo also risks political capital by favoring spending reductions over tax increases for wealthy New Yorkers. Opting to let a surtax on the rich expire, Cuomo amends his "no new taxes" promise to include "no renewed taxes." While that might not sit well with voters who'd rather avoid education cuts, David said the governor's proposal addresses another elephant in the room, which has to be done sooner or later.

New York has the highest state and local tax burden in the nation. It is a stifling burden, especially on the upstate economy. As the governor has said a million times, the state's tax burden and regulatory climate is stifling the private sector; the government can't revive the economy. If we keep these high taxes on the wealthy, many will leave and many will take their businesses with them.

David also insisted that it was a mistake to think of spending cuts as necessarily detrimental to public institutions. He cited statistics showing that 75 percent of New York's Medicaid dollars are spent on 25 percent of the people, and that we spend more on the program than states like California. The governor's budget, David explained, mandated $2 billion in savings on Medicaid, but allowed flexibility in how administrators reach that mark.

Leaner, more efficient management is the order of the day, he said. 

If there's anything we've learned over and over again, it's that we do a terrible job on Medicaid and a terrible job on education despite spending more money than any other state in the country.

Liz Benjamin took issue with David's characterization of the spending cuts, saying the governor might not mean for low and middle income families to feel the squeeze, but that's very much what's going to happen.

All over New York state various school districts, particularly upstate, are laying off teachers and cutting programs. That's just bottom line, it's the reality of what districts are doing.


Liz Benjamin and Greg David


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Comments [16]

Christine from NY, NY

Brian- This guy again? Good grief... why?

Mar. 31 2011 01:42 PM

I'm always curious about the charge that millionaires don't pay their fair share. Even with their loopholes, they pay more in actual dollars than you and I, they pay a higher percentage than you or I, and they pay more sales tax than you and I. What is fair? Give me a dollar and/or percent that you consider fair.

Mar. 29 2011 03:31 PM
DTorres from Nathan Strauss Projects

GE wasn't asked to tighten their belt
and they are swimming in cash, paying
zero in taxes.

Landlords win and tenants lose in
Cuomo's budget.

Senior Citizens lose in Cuomo's budget.

Schoolkids lose in Cuomo's budget.

Millionares win in Cuomo's budget.

Mar. 28 2011 05:11 PM
DTorres from Nathan Strauss Projects

It seems odd, that millionaires need more
money, they need to keep all their money,
but poor people, schools, housing, medicaid
needs less money.

Moving senior citizens to managed care,
means that they will not have access to
the drugs that keep them alive.
It means that senior citizens eat more cat food, have to do without.

Cutting school funding, means that
teachers know they are fighting a losing
battle and are just hoping and praying
that application they put in to the private
school comes through.

It means that more correction officers
will be needed, because Rikers Island
is going to be in business.

Mar. 28 2011 04:56 PM
Sue from Manhattan

One real group of victims are the NON-millionaires in NYC & and its suburbs who need affordable housing. As Liz Benjamin pointed out, even if rent regulation is renewed as is, NYC will continue to lose tens of thousands of apartments each year due to vacancy decontrol - which has NOTHING to do with the income of the past, present, or future tenant. "High rent" decontrol (which constituted about 1/200th of the apartments deregulated out of the 300,000 or so in the past decade), should be changed, but that's not the main issue.

It's distressing that Cuomo, a Democrat, has bought into the "taxes deter business" line of the GOP and the Real Estate Bd of NY - his strongest monetary supporters.

Mar. 28 2011 11:17 AM

With Greg David running the journalism program at CUNY, it's no wonder business/financial journalism today is hopelessly bad.

Business journalism, after all, missed the financial crisis utterly, and completely ignores the reality of life in the U.S. today. Like the economics profession, it's steeped in orthodoxy.

And Greg David is exhibit A. By the way, he also opposes the penny tax on financial transactions. Wall Street would pick up and move to Nigeria, if we asked it to contribute to American society!

Mar. 28 2011 11:06 AM
amalgam from Manhattan by day, NJ by night

I actually agree with Mr. David that costs COULD BE lowered in Medicare and education with even better performance if the right system was in place, but that system is not there. We must live in reality.

Mr David's sentiments are similar to many Republicans in their current fetishization of spending cuts whereby they clamor for these cuts without looking at establishing real reform and without any concern for how real people - almost entirely lower class and/or minority - will be affected by those decisions.

I guess those feelings could be called callous.

Mar. 28 2011 10:34 AM
Amy from Manhattan

So would raising the rent decontrol threshold to compensate for inflation be considered "strengthening" rent stabilization, or just maintaining it?

Mar. 28 2011 10:30 AM

Cut the bureaucrats from the Board of Education, not the teachers!

Mar. 28 2011 10:28 AM
Brian from Hoboken

Brian- can your guests comment on the article in this weekend's WSJ that analyzes the huge state revenue fluctuations as a result of over-reliance on the wealthy paying a large share if taxes? I am off a little in the numbers but the top 1% of earners in NY pay 40% of the state's taxes and these people's income can fluctuate 50% or more depending on the economy.
The lead economist in CA recommends broadening and flattening the tax base to stabilize tax revenue in the state.

Mar. 28 2011 10:27 AM
Josh Karan from Washington Heights

Can Greg David give any evidence for asserting that we spend enough money on public school education in this City & State?

This is opinion, not fact.

Can he cite any other place which has the degree of poverty and non-English speakers amongst its students, yet spends less and has better results?
I have never seen any.

It is like an argument that a half dose of anti-biotics is a waste of medicine because it did not cure the disease, when twice as strong a remedy was needed from the outset.

Mar. 28 2011 10:26 AM
samhill from Manhattan

Regarding the millionaires tax , the real motivation behind Cuomo is that he might want to run for president one day and he doesn't want a tax raising millstone forever around his neck.

Mar. 28 2011 10:24 AM
amalgam from Manhattan by day, NJ by night

I think Mr. David has the right to claim that state and local taxation are causing NY state residents to flee, he and others just don't have any precise data point to support that, so what he said is entirely debatable, just as Mayor Koch said last week.

Mar. 28 2011 10:23 AM
CL from New York

Worthless "commentary."

Mar. 28 2011 10:21 AM
carolita from new york city

"A budget for the people by the people?" What people? RIch people? I'd like to know why we're all so worried about rich people leaving the state, and not worried about the rest of us? How about regular people? Do they worry about ME leaving the state? Whether or not rich people will leave is not a "controversial question", it's a dumb question. Of course they'll stay. They can afford to. If they can afford to send their kids to private schools because public schools are floundering and unworthy of their children, they can afford to stay and help pay for public schools' survival.

Mar. 28 2011 10:21 AM
bob from manhattan

When will the media stop being confused

the law is about rent stabilization not rent control

Mar. 28 2011 10:12 AM

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