Wednesday, January 06, 2010

David in the Lions' Den

Paterson Proposes
Reforms on Ethics
And Term Limits

By Henry J. SternJanuary 6, 2010

Today we enjoyed a political double-header. The legislature met in joint session to hear Governor Paterson's State of the State address; and the City Council held its Charter Meeting and re-elected Christine Quinn as Speaker.

As had been leaked for two days, the governor made a series of reform proposals, dealing with ethics, conflicts of interest, public finance and term limits for legislators. He spoke at length on economic development proposals. His economic agenda in particular did not generate an enthusiastic response from lawmakers. The ideas sounded stale even if they were new; there was little about relieving the burdens of taxation or improving the state's infrastructure. He emphasized increasing programs for minority and women business contractors, which has been an area of manipulation for some time: contractors often make their wives CEOs, or hire a minority member to front for them. Otherwise, this program leads to buying pencils from ten different suppliers instead of one, which generally costs the taxpayers more per pencil.

On Monday, we urged the governor to make bold proposals, and to lead even if others would not follow. On the issue of ethics, he did just that. The reforms he advanced would be a great step forward in leveling the playing field in a way that would promote honest government. Unfortunately, we do not expect any significant reforms to emerge from the rogues' gallery in the state senate or the dutiful members of the assembly. A number of one-house bills may emerge. These are bills that are passed by either the senate or the assembly but are considered dead on arrival in the other. One of their purposes is to allow legislators to be recorded as voting for reform, while secure in the knowledge that no reform legislation will be passed by both houses, which is a necessity before it can go to the governor for his signature or veto.

The financial crisis caused by the multi-billion dollar state deficit is, as has been said, the 800-pound gorilla in the room, which no one is quite ready to deal with. The state's economic picture, although it appears to have stabilized, has not improved enough to provide sufficient tax revenues to close the budget gap. The remedies for the deficit are the same as those traditionally available: reduce expenditures, increase taxes, borrow money, and receive a larger federal subsidy cloaked as a stimulus package. The problem, of course, is that hardly anyone in Albany wants to lay off any employees, taxes are now the highest in the nation (and any increase will drive out the people on whom the burden would be increased), the law prohibits straight borrowing (so it would have to be done through a subterfuge), and we cannot now predict what the Obama administration will offer to local government, particularly in view of increasing Congressional resistance.

A financial shortfall does not usually have an instant immediate impact, like Katrina or a tsunami or 9/11. It is more like a slow garroting of the beleaguered city, state or private corporationleading to higher interest rates followed by inability to borrow money, increasing delay in paying bills, closing of satellite facilities, failing to follow costly new mandates because of lack of resources, freezing salaries or deferring wage increases, postponing capital construction, scaling back appropriations for cultural institutions now largely supported by the city, weeding out underperforming managers and employees, tightening the award of disability pensions, and reducing consultants contracts, particularly at the Department of Education. Not all of this would be bad. Some budget cuts are in fact beneficial, except for the person being cut.
But for agencies and taxpayers, these budget reduction exercises would be salutary, at least in part. Some should have been implemented earlier with the co-operation or initiative of the agencies involved. But that is very difficult to achieve. Here is why.

As you may know, I was Commissioner of Parks & Recreation for fifteen years, under Mayors Koch and Giuliani. (1983-90, 1994-2002). During that time, there were periodic, almost annual, budget crises. In January, we began with an executive budget shortfall, followed by a series of PEGs. That is an acronym for "Program to Eliminate the Gap". Commissioners were asked to offer up budget items from their agencies which could be reduced or eliminated without affecting the delivery of service to the public.

Hardly anyone did that, except possibly some rookie commissioners. Instead we offered up items that would be very difficult to cut, like lifeguards at the city beaches. Then we worked with OMB to find more modest cuts which we could accept. The most vivid example is the cutting of grass. If the lawns were mowed every three weeks instead of every two weeks, there would be a one-third reduction in the cost of mowing, gasoline and repairs. The grass would grow longer; it was like taking an extra week between haircuts. When, however, the frequency of mowing went to four or five weeks, the lawns became truly unkempt. Weeds flourished. People were more likely to litter. Dogs could then do what dogs do with the result hidden in the taller grass. People became less likely to clean up after their dog because their product was less visible, although no less noxious.

The state fiscal year begins on April 1, which is the legal deadline for the adoption of a budget which must by law be 'balanced', which really means it can't be as far out of balance as the spenders would like it to be. The city fiscal year begins on July 1, and the final budget is adopted in June. The federal fiscal year begins on October 1. Congress adopts budgets for various agencies at different times in appropriation bills. Legislators attach riders (amendments) to appropriations to achieve specific objectives which are not usually that relevant to the appropriation itself, but the need to adopt the funding bill sometimes compels the approval of these riders.

The adoption of the state budget will be more difficult than usual this year because 1) at this point, expenses far exceed revenues, 2) this is an election year, with the Republicans appearing to rally from their low point last Spring, 3) the Senate is so closely divided that all 32 Democratic votes are required to take any action, 4) if Senator Monserrate is expelled, the Democrats lose their majority until a successor is elected to replace him.

That is the reason that even those Senate Democrats who have publicly demanded Monserrate's removal may not insist on a vote on the matter, leaving it to Senator Sampson to bottle up a motion to expel the convicted girlfriend-dragger. Judge Erlbaum, who presided at the trial after Monserrate's lawyer waived the right to trial by jury, did not convict the senator of the felony of throat-slashing but made clear his view of what was likely to have happened, although he felt the required standard of proof had not been met.

We are anxious to see what, if anything, the Legislature will do to prevent its reputation, already low, from sinking further. It is somewhat like last winter, when people wondered whether, if ever, the market would stop falling. One unintended consequence of their ethical lapses is to make Governor Paterson look better. Notice how Attorney General Cuomo has remained aloof from both the financial and the ethical issues embroiling the Legislature. If we were in his position, we might do the same thing, but at some point he will be called on, and we look forward to his entering the arena. Do you recall these lines by a former Governor of New York State, Theodore Roosevelt, who wrote:

"It is not the critic who counts: not the man who points out how the strong man stumbles or where the doer of deeds could have done better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs and comes up short again and again, because there is no effort without error or shortcoming, but who knows the great enthusiasms, the great devotions, who spends himself for a worthy cause; who, at the best, knows, in the end, the triumph of high achievement, and who, at the worst, if he fails, at least he fails while daring greatly, so that his place shall never be with those cold and timid souls who knew neither victory nor defeat."
Who is the Theodore Roosevelt of today?

StarQuest #635 01.06.2010 1416wds

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