Tuesday, April 06, 2010

NY Still Has No Budget In Place; Gov. Paterson Still Clueless

New York was supposed to have a budget in place April 1, but the state has managed that feat only six times since the 1970s. Yet, Gov. David Paterson has time to get snippy with Comptroller Tom DiNapoli when DiNapoli issued a report pointing out that the state is set to once again use all kinds of gimmicks to mask structural deficits.
A report the State Comptroller Thomas DiNapoli Monday said that New York has been using financial gimmicks to mask the state's huge budget deficit, and "state lawmakers constantly move money around like a shell game," NBC-Channel 4 reported.

"Tell us something we don't know," was the governor's snide remark after reading the report.

"Rather than saying, 'Oh look there's a fire!' what we need is advice for how to put the fire out," Paterson said during a radio appearance early Tuesday.
Here's the advice: stop spending money that the state simply does not have and cannot reasonably expect to take in with tax revenues. Overly optimistic tax revenue projections have repeatedly fallen short, exacerbating the deficits.

The state needs to curb its spending, and last year was a prime opportunity to do so, yet the state increased spending using federal stimulus money to supplement the increase. This year, the state has less money at its disposal and there's no stimulus money either.

So, this year we must see a significant cut in state spending, or else the budget will remain out of balance.

Yet, this fundamental concept is so difficult for Albany to understand that they'll go ahead and pass a flawed budget that increases spending based on money that simply isn't there and then throw up their arms when the deficits reappear and require even more dire cuts.

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