Be Like Barack?

Will Andrew Cuomo follow the example of Barack Obama and try to use his administrative authority to implement something he can’t get passed the constitutional way?

Advocates of an increase in the state’s minimum wage law have suggested Cuomo do an end around on the State Senate which opposes the measure as threatening small business and jobs.

This observer feels it is unlikely that Cuomo will do so, however. He certainly might have tried something like that when he was younger, but he’s much too smart to jeopardize his own career by playing footloose and fancy-free with the state constitution.

The opening Dean Skelos has given the governor and the State Assembly looks like a more appealing alternative. Skelos has suggested the Senate might stomach the minimum raise hike if offset by targeted tax breaks. Of course that would mean Cuomo would have to find ways to reduce state spending. Such a compromise would likely help the Republican Party hold onto the Senate in November. As a result, the most likely outcome is that neither gets done in 2012.

School Dropout Poll Results + This Week’s Poll Question

Empire Page readers favor Pres. Obama’s admonition to states to raise the drop-out age to 18 by 67% to 25% opposed and 8% having no opinion. Truthfully, however, it’s a hard position to argue against without appearing to be a died-in-the-wool libertarian — i.e., someone who might argue mandatory schooling is an affront to human liberty.

This week we’re asking people to stick out their thumbs and tells us where things stand with NYS’s economy: Is is “on the mend,” “moving sideways,” or “getting worse.” Vote today at the Empire Page website and while you’re there if you’re not already a subscriber why not take out a free trial subscription. Just click on the subscribe link at the top of the page.

We’re certain once you try the Empire Page, you’ll want to subscribe to be able to access each day’s links to hundreds of news stories, editorials and columns divided by topic and news source. The cost is only $95/year, which amounts to $0.26/day.

The State of New York in January 2012 according to Cuomo II

Because it’s only January, Andrew Cuomo could enjoy, while writing his State of the State message, the luxury of ignoring the fact that it’s an election year. As we move closer to November, however, the ambitious agenda he proposed in yesterday’s State of the State will begin to come up against political realities. The major political issue facing the Legislature is redistricting, the outcome of which will determine whether the Republican Party retains its majority in the State Senate. If the Senate Republicans feel their toehold on political relevance is threatened, their willingness to go along with the governor’s program will diminish; yet who can blame the Democrats for wanting to draw district lines that would give them control over both Legislative bodies?

For the most part the Republicans should be happy with the Governor’s agenda. He says he will balance the budget without increasing taxes or imposing new fees; he wants to reduce the state’s pension obligations by creating a Tier 6 for future state employees; he wants to do something about the unfunded mandates that are crushing localities; he wants to put money into the state’s transportation infrastructure, which is particularly important to the business community; and he wants to make New York more competitive to boost job growth.

In fact, Cuomo may have more trouble with the Assembly than the Senate over such questions as imposing teacher evaluations on public schools, amending the Constitution to allow casino gambling and Tier 6. Knowing that his agenda is to the Assembly’s right, he threw the Assembly several bones in his State of the State, including foreclosure relief, protection for renters and doubling the goal of state contracts awarded to women and minority contractors.

Some commentators see Cuomo positioning himself for a future bid for the Presidency. He certainly infused his speech with campaign-style rhetoric, claiming he and the Legislature restored New York’s reputation as “the progressive capital of the nation.” 2011 did represent a change in direction for New York, but it was one that was forced on the state, not one the Legislature in particular wanted to embrace.

As the nation’s economy continues to teeter on the edge of another recession, depending in large part on what happens in Europe, New York again has little choice in continuing on the path of reducing the cost of government without undercutting essential governmental programs or raising taxes. To that end the governor is placing a huge bet on the idea of public-private partnerships–the idea that public investment can leverage private capital. The billion dollar leveraging projects he announced Wednesday include building the country’s largest convention center on the site of the Aqueduct Race Track, the rehabilitation of the Javits Center into a Battery-Park style complex, transportation infrastructure upgrades, an energy highway and $1 billion to help Buffalo reduce its 28% poverty rate.

Whether these public-private partnerships succeed in leveraging the kind of private investment Cuomo envisions only time will tell, but the concept is worth trying. It’s certainly an approach that makes much more sense than the Obama administration’s approach to economic development of investing public funds in companies (like Solyndra) that it wants to succeed in the market place.

Poll Question on Tax Deal

Governor Cuomo and the leaders of the NYS Assembly and NYS Senate announced a tax and spend deal yesterday which cuts taxes for “moderate” income New Yorkers while raising the rate for high income earners. They also agreed to spend $1 billion on public works projects and move towards a constitutional amendment to allow casinos on non-Indian lands.

Read the details on the Empire Page, then vote on our poll question of the week.

Governor’s Op-Ed on the Empire Page

Read NYS Gov. Andrew Cuomo’s op ed on tax reform in the guest editorial section of the Empire Page.

Roundtable on What’s Next for NYS

We published today comments by a number of friends and colleagues of the Empire Page on the question of what next for NYS. Based on the premise that Andrew Cuomo’s first legislative session was more positive than negative, we wondered what can be done to continue to bring fiscal, economic and social health to NYS in light of a national — if not world– economy that is barely moving forward.

Anyone interested in NYS’ future will gain insights and ideas from reading our experts’ comments. Feel free to use the comment form at the bottom of the page. (Comments will be moderated.) And if you feel you have a unique viewpoint on the problems and can present your ideas coherently, send them to editor@empirepage.com. If they pass muster, we’ll add them to the page.

New Roundtable & Poll Question of the Week

Round Table Discussion

The Empire Page is launching a roundtable discussion on where NYS goes from here.

Here’s what we’ve asked our experts to comment on: Background: Most people agree that New York State under Andrew Cuomo’s leadership made progress in addressing the imbalance between the cost of our public sector and taxpayers’ ability to pay the freight. The question is what more can be accomplished given the state of the national economy? Two years into the recovery, the national economy is clearly weak and in danger of being dragged back into negative growth numbers by a combination of factors including debt crises in Europe and at home. Where does NYS go from here to boost economic growth, reverse the outmigration of businesses and middle class taxpayers while still meeting the needs of our citizens for police and fire protection, safe roads, good schools and other public goods?

The first postings will appear midweek. If you’d like to participate, email us at editor@empirepage.com.

Poll Question

Last week we asked our readers to evaluate Hugh Carey’s reputation. Was he (a) underrated, (b) smarter than he appeared, (c) tougher than he appeared, (d) all of the above, or (e) none of the above. 63% thought he was all three characterizations; 22% none of the three; 10% underrated, but not smarter or tougher and 2% smarter, but not tougher or underrated and 2% tougher, but not smarter or underrated.

This week we’re asking you what Andrew Cuomo should be focusing on right now: Is it (a) redistricting reform, (b) the economy, (c) next year’s budget, (d) all of the above or (e) none of the above.

Avoiding Greece in New York

One of the major factors dragging down the Greek economy is its large inventory of non-performing private property. Only now, when faced with extreme cutbacks is the government starting to put some of its $500 billion inventory on the market.

What does that say to New York State? Get serious now about selling state-owned property that is not essential to the public welfare. That should include selling marketable state land in the Adirondacks that is not essential to protecting the environment and that would benefit the region’s economy.

The goal of purchasing more and more land in the Adirondacks has little to do with protecting the environment – despite claims of groups like the Adirondack Council. Instead it’s all about political power – who gets to make decisions – Albany or the local community – and at whose expense.

The end result of land purchases is that many Adirondack communities are not economically viable. The latest census reports declining populations throughout the region. Young people move out as soon as they can because there are no jobs for them and even if there were, there is no affordable housing for them to live in. The fact that there is a finite amount of lakefront property also limits the opportunities for middle class families south of the Park to purchase summer homes.

Instead of buying more land the state should be selling land such as the northwest shore of Sacandaga Lake (not to be confused with the “Great” Sacandaga Lake). Hamilton County needs to expand its tax base. Adding 10 or 20 more properties on the shore would help the County and aid local businesses as well. There are no environmental reasons for keeping that land in state hands.

There is one property on the west side of Sacandaga Lake that the state is going to take back from a 99-year leaseholder when the current resident dies. This is an example of government imperialism – using state power to quash citizen rights. The descendents of the current owner should either be allowed to up the current lease or the state should put that property on the market. Again, there is no environmental justification for taking that land.

If it takes a constitutional amendment to end the tyranny of state land ownership in the Adirondacks, then so be it. That’s just one more reason to hold a constitutional convention before 2017.

Andrew Cuomo and Hugh Carey: Lessons from the Past

In the midst of his successful campaign for governor, Andrew Cuomo reportedly sent public employee union leaders around the state copies of Seymour Lachman and Robert Polner’s The Man Who Saved New York; Hugh Carey and the Great Fiscal Crisis of 1975 (State University of New York Press, 2010). Several responded publicly by arguing that the crisis of 1975 was not the same as what we’re facing today. No, today’s situation is potentially much more serious because we’re not just talking about one city, but the entire state and a huge percent of its municipalities.

In 1975, other municipalities, including the city of Yonkers, were on the verge of defaulting on their debt. But none were in as bad a shape as New York City. The city had resorted to short term borrowing in order to meet operating expenses, but even that stopped working. They had come to the end of the road – being unable to meet both short-term and long-term obligations. The state had to step in to avoid being pulled down in the undertow and as a result, NYS taxpayers had to cough up millions to service the city’s debts and those of the Urban Development Corp., the State Dormitory Authority and other authorities.

Today’s crisis has not reached the stage that Hugh Carey faced on his first day in office in January 1975. That’s one major advantage that Andrew Cuomo will have on January 1, 2011. However, while the cost of preventing the city’s bankruptcy was felt by the thousands who lost jobs and services, the state and federal governments pitched in and helped avoid a bigger crisis, due in large part to Carey’s indomitable will and political astuteness. However reluctant he was to face facts, Carey benefited from having hired people of character and talent. They helped him see the danger, at which point he piloted the ship of state to safe harbor, although not without nearly crashing into several large political icebergs.

One key for Andrew Cuomo then is what kind of people will he bring to Albany? Will he follow Hugh Carey’s example and hire people who will not be afraid to talk truth to power, or will they be people who are cowered by Cuomo into painting the world as he’d like it to be?

Another key will be whether he understands the problem is not just solving next year’s budget crisis, but seeing what New York State will be facing in 2015 and 2020. I’m not saying finding $8 billion without raising taxes to balance next year’s budget will be easy, but will the budget be balanced with the long term in mind or will Cuomo follow the pattern of his predecessors – not worrying about future until it arrives?

In 1975, Hugh Carey’s biggest obstacle was getting the federal government to participate after the city and state had both sacrificed and made major changes in budgetary practices. That took a tremendous effort on Carey’s part and required incredible political savvy. Even if Cuomo matches Carey in those qualities, the likelihood of the federal government’s playing an equivalent role in the coming years is slim to none. The simple reason is that New York would be joining a long line of states with their hands out.

Start with California whose debt is already being subsidized by the federal government (see “State Bailouts? They’ve Already Begun” by Meredith Whitney, Wall Street Journal, 11/3/2010, A27). If New York wants Washington to bail it out, it would hardly be at the front of the line and would have a tough sell to a Congress that will be extremely resistant to increasing federal spending, given Republican control of the House and the number of Democratic Senate seats up in 2012.

Let’s hope Andrew learns from Hugh Carey in another respect. Hugh Carey didn’t spend any time blaming his predecessors – Nelson Rockefeller and Malcolm Wilson – when he arrived in Albany. That’s a lesson that Barack Obama should have taken to heart. Blaming Bush may have worked for a short time, but he played that card past when it had lost any political value. There would be nothing to be gained were Cuomo to blame past governors or Legislatures for the problems we’re facing. Given that Cuomo asked to be put in a position to solve the state’s problems, the best strategy is to skip the blame game.

Union leaders should read this book. Lachman and Polner point out how men like Albert Shanker and especially Victor Gotbaum put aside self-interest and joined Carey in achieving a major victory on behalf of the entire population of New York City and the state. Everyone needs to understand that the practice of the state’s spending better than 250 percent of its tax receipts over the past decade (see Whitney) needs to be put in reverse.

Thirty-five years ago New York City’s leaders waited much too long to admit their fiscal practices were unsustainable. It appears that Sheldon Silver recognizes New York State is heading in that direction. Would that the state’s union leaders accept that reality and help avert the kind of crisis that the city faced. If not, there’s no guarantee the outcome will be as successful as the one Hugh Carey achieved in ’75.

Poll Question of the Week

Last week I asked whether our readers support a proposal set forth by PEF that NY could save money by hiring more people in order to reduce overtime costs. For the first time in the history of Empire Page Poll questions, there was a tie. Forty-six percent of those who voted agree with PEF’s solution; forty-five percent disagree while ten percent have no opinion.

I am not totally surprised at the results because the issue has not been widely discussed and I’m sure many people felt they lacked some of the basic facts necessary to form an opinion. I’m inviting anyone with knowledge and opinions on the subject to submit a guest editorial on it.

Here are my questions: 1) Who is earning overtime — what workers for what agencies? 2) How much are they earning? 3) Why is overtime required? 4) Are these short-term or long-term conditions? 5) Wouldn’t the state be taking on a much larger long-term obligation in hiring people than paying for overtime in the shortrun?

Poll Question for the Week of May 23

NYRA — the New York Racing Association — has put more than 1,400 people on notice that they may be losing their jobs if NYS will not lend it $25 million in advance of this summer’s racing season. The tracks affected are Saratoga, Belmont and Aqueduct. Gov. Paterson has indicated that NYS will loan NYS enough money to stay open through the Saratoga season.

There’s no doubt that the loss of the Saratoga season would be a catastrophe for the entire Capital Region and for NYS.

Ironically New York’s Off-Track Betting system is also going broke. It was the arrival of off-track betting that many credit with the decline of New York’s vital racing industry because it allowed people to bet on races without going to the tracks and the revenue split provided less for the racing industry.

In recent years the annual take by the OTBs has declined rapidly and they are having a hard time just paying their bills, not to mention providing any kind of decent return to New York’s taxpayers. What to do about the OTBs is a major issue which needs to be addressed by the Legislature soon.

NYRA on the other hand almost lost its franchise a few years ago and is now under new management with another long-term arrangement with the state. One element of that agreement was that NYRA would collect revenue from video slot machines that were supposed to be installed at Aqueduct as a result of legislation that was passed in 2001.

NYRA’s request for a $25 M loan is based on the state’s failure to have put the Racino in at Aqueduct. Should NYS loan NYRA the $25 million or should we bury the three flat tracks and fix up the OTBs instead? Vote this week at EmpirePage.com.