THE BLOG

Going Broke in Albany, Part 1: Explaining The Budget and How We're Botching It

03/18/2010 05:12 am ET | Updated May 25, 2011

How bad is it up there in our capital? Are you trying to follow the story of our state budget, but find New York politics to be needlessly complex and boring? I'm writing three opinion pieces that describe what's happening in Albany with the budget, its severity, its media coverage, and possible solutions.

Uh-oh.

The State Senate has our budget in its clutches.

The State Senate: home of dysfunction, bastion of corruption --
a place where most bills leave as shadows of their former selves,
battered by special interests, wearing rags and begging for spare
signatures. Unfortunatley, they’re the last division of our state government that hasn't joined the general consensus with the rest of Albany that we need painful budget cuts to ensure the future of our schools and health care. That leaves us catering to their demands.

What’s happening with the budget in Albany right now is called a “Quick Start.” The Senate, the State Assembly, and the Comptroller’s office all write mid-year reports, which basically describe the fiduciary state-of-the-state. They each submit these reports to the Department of Budget, which in turn writes a comprehensive joint-report. This way, instead of researching and presenting budgetary information on April 1, the state government starts analyzing economy, revenue and spending in November, which allows for a more thorough investigation into our budget, earlier in the year.

This time, however, the investigation uncovered some unexpectedly ugly stuff.

     

The Controller’s office reported a 4.1 billion dollar deficit for the current Fiscal Year, with 37% growth in spending and 3% growth in revenue over 4 years. The Assembly forecasted a 3.7 billion dollar deficit for the current fiscal year, 500 million dollars more than Governor Paterson and the DOB’s 3.1 billion dollar prediction.

The Controller, Assembly and DOB’s reports all admit a deep, fundamental flaw within our budgetary structure, and suggest its long and short term instability. All three reports admit that we can't afford our spending and we're running out of places to find dough. According to the DOB, over half of our funding has come from non-renewable resources over the last 7 fiscal years. According to Controller DiNapoli, we'll reach our cap on outstanding debt by 2013.

So while the numbers may range, all three departments stepped up rhetoric on the severity of the current deficit and the need for serious spending cuts. Over 55% of our spending goes to social services, the largest amount in the US. It’s never politically popular to admit a need for education or health care cuts in New York State, and our representation in Albany is being uncharacteristically candid, serious and effective in uniting against the largest deficit in the history of the state.

But I’m not, of course, talking about the State Senate. Their report tells us a massively different story. An irresponsible, poorly sourced, and long-winded story.

The Senate's story is 70-pages, compared to the Controller’s and DOB’s 15. It's a story of miraculous impending economic recovery, enormous enough to boost consumption and business taxes to a level that could keep our deficit in a healthy range. They predict higher gains in employment, income, wages than the Assembly, Controller, or DOB, across the board for national and local growth.

They tell us a story of wildly effective “one-shot” deals: budget adjustments that don’t alter the structure of the system, that are non-recurring and short-term. To give you some perspective, we just ran through the benefit of 9 billion dollars worth of one-shots that lasted us 9 months and led us to this current crisis. The Times reports that 75% of the Senate’s current deficit reduction plan is based on “one-shots” as well.

Their story is adorned with long-winded, indecipherable passages on irrelevant national economic data, dozens of Byzantine charts and graphs, and ultimately, only one source for the economic data in their story, the private economic forecaster IHS Global Insight. The Controller’s report uses IHS as well, along with 7 other sources, including state departments and State University research. The DOB uses every state department in addition to the three office reports to source their work.

They've created an irresponsible and potentially damaging document, just to save their personal reputations among constituents and to keep their state-funded projects alive. If the Senate gets their way, in just a few years we’ll end up having to gut education, Medicaid, and public assistance. In just a few months, we’ll have to lay off a huge percentage of state employees.

Unfortunately, they end up empowered by their short-sightedness. They hold the trump card, because they’re the only public servants left in Albany who are politically short-sighted enough to shoot down the budget proposal. They’re afraid to go back to their constituents with education cuts, and when our schools get gutted in a state of emergency once we can't borrow anymore, I suppose they'll have our unpopular governor to blame. They’re also the loudest voices, under the inflammatory and oafish financial leadership of Finance Chair Carl Kruger.

I have to give it to the Senate for their consistency; how steadfastly they disappoint and find political upper-hand through the lowest forms of political appeasement. They’re also inventive, always finding new ways to damage the state. Hopefully, this time they get held accountable before they vote on the budget, and not when it’s too late for our schools and public services.

Next up: Part 2 - Should we Panic? The News-Media and the State Budget.