Monday, January 04, 2010

State Flounders in 2009

Disappointing Year in Albany

Fiscal Problems Unaddressed

Senate Squabbles for a Month

By Henry J. Stern
December 31, 2009

We are writing on a cloudy Thursday afternoon, December 31. Snow fell this morning, and melted by noon. Pogo and I are sitting in a largely empty office, the week between Christmas and New Year's Day now being frequently taken as a holiday, a winter version of colleges' spring break. We have looked over the 111 articles we wrote in 2009 (not including this one) and are impressed by how many different situations have arisen in state and local government; most of them reflecting some kind of misconduct or shortsightedness.

If one writes too frequently of shortcomings, one can get the reputation of a Cassandra, Eeyore, Chicken Little, or boy who cried 'Wolf'. But what if the bearer of bad (or mediocre) tidings is accurate, like the soothsayer in Julius Caesar? Rule 29-T covers that: "The trouble is the charges are true." Or true enough to require a thorough cleansing.

Before we summarize 2009, we want to give you the chance to go directly to our StarChives, where we keep all our articles (since 2002). By linking here, you will see the headlines. You can, if you wish, by linking once more, read or skim anything that piques your interest. You can read them free, and at your leisure. One observation we make is how many unsatisfactory events took place which are now largely forgotten, because other disappointing things have occurred more recently.

It is true that we have cried 'wolf', but in the case of the city and state of New York, there is a big, bad wolf at the door: insolvency. The state's fiscal problems are greater than the city's because the governor and the legislature have been particularly improvident and continue to spend more money than the state collects in taxes. Receipts have been substantially reduced by the Great Recession, which is what we should call the consequences of the last two years: the bursting of the mortgage bubble, the discovery of over a trillion dollars in toxic debt, the bankruptcy or collapse of major financial firms which did not receive bailouts, the huge decline in the stock market (now abated in most cases), the unemployment rate of ten per cent, and the mounting deficits in city and state budgets.

These events, taking place since the fall of 2007, have created a difficult climate for local governments, which, unlike the Federal Reserve, have no access to printing presses and no significant relationship with the People's Republic of China. Cities and states are obligated to provide continuing services to the public: police, fire, education, health, sanitation and parks, among others. Some expenditures, such as assistance to the poor, increase in bad economic times because the city and state provide assistance to victims of the recession and their families. To make matters worse, it is difficult to raise additional money through tax increases when tax receipts are declining, and individuals and businesses are in financial distress. In these circumstances, financial competition with other states intensifies, and corporate power to extract concessions increases.

The legislature's reluctance to make necessary reductions in spending intensified the state's fiscal problems during 2009. This recalcitrance to reduce school and health assistance to localities comes mostly because such cuts would impact members of the unions that make substantial year-round political contributions to legislators, and regularly endorse incumbents at the biennial elections. Rule 30-N: "There is no such thing as a free lunch."

The unions and the legislators, naturally interested in self-preservation and, where possible, personal and institutional aggrandizement, place their own overarching needs far ahead of any concern about sound fiscal policy. This is not a partisan issue. Republicans, who claim to be more fiscally responsible than Democrats, have not acted responsibly when they held office. The second Bush administration was supposed to bring reductions in the size of the federal government and ended up approving massive increases. New York State Republicans have acted in a similar manner. Not since the first year of the Pataki administration (1995) has budget reduction been a priority, and even Pataki abandoned that attitude as his twelve years as governor wore on.

Apart from fiscal concerns, the year was most notably marked by the farce which occupied the State Senate for over a month. Defecting Democrats gave Republicans control of the chamber in a sneak attack, but neither side for some time could put together the 32 votes needed to transact business. When the defectors returned to their original base, they were treated as conquering heroes, and given fiscal, titular and patronage rewards which they had previously denied. Their successful operation, creating chaos and then receiving rewards for ending it, is evocative of the Somali pirates in the Indian Ocean. The difference is that the pirates had no prior loyalty to the shipowners; they were not betraying anyone, simply enriching themselves. Pedro Espada and his confederates were elected as Democrats; their actions were deceitful as well as possibly criminal. The defectors demanded and received millions of dollars in jobs and member items, just to return to the status quo.

Unfortunately, their fellow Democrats acted as enablers. So eager were the wimps and wusses to gain their own committee chairmanships and member items, they surrendered meekly to the demands of the pirates. A few hypocrites among them issued sanctimonious statements denouncing the turncoats and proclaiming their own distress. The truth is that any one of them could have stopped the coup by simply voting 'No,' because each Democrat was the 32nd vote needed to take action. The pathetic events of midsummer will stain the reputations of all the participants, both active and passive.

The effect of these shenanigans was to increase public contempt for the legislature to what appears to be an all time high. The blatant disregard of the public interest demonstrated in Albany resulted in editorials (from all the city’s newspapers and many other papers around the state) excoriating self-dealing and corrupt behavior on both sides of the aisle. Whether this disgust will have political consequences will be determined, one way or the other, in 2010 and in years to come. There may have been only four aggressors, the Amigos, but the other 28 Democrats in the Senate were complicit in paying the ransom.

The mills of justice took their toll on senior legislators, Senator Bruno and Assemblyman Seminerio among them. The two had, separately, set themselves up as consultants, and collected substantial fees (in Bruno's case, $3.2 million over the years) from companies seeking contracts with the State of New York. Among the smaller fry, Senator Monserrate distinguished himself by allegedly raking a broken glass over his girlfriend's throat and then dragging her into a car and driving her to a distant hospital. His story was that she fell on the glass, which is a common excuse in domestic violence cases, recanting complainants being so clumsy in times of stress.

Probably the best way for you to review 2009 in government is to link to Starchives, where you will find the headlines on the 112 stories we wrote this year (Nos. 522 to 632). You can skim the headlines and sub-heads easily, and link to those articles that attract your attention. In general our stories report the baser side of human behavior, because that is what one is most likely to encounter in the corridors of power at the State Capitol. The most common sin among legislators is greed, or avarice. The other six of the seven deadly sins are anger or wrath, envy or jealousy, gluttony or extravagance, lust or fornication, pride or vainglory, and sloth or indolence. (We limited ourselves to one sinonym for each.)

Historical digression: The seven deadly sins were first publicly enumerated by Pope Gregory I in 590. Wikipedia tells us that they were adapted from a list compiled in Greek by a fourth century monk, Evagrius Ponticus. (The region called Pontus is in northern Turkey, facing the Black Sea.) The sins also appear in Dante's Divine Comedy. The list has endured for over fourteen centuries. The sins are not new, but technology and weapons of mass destruction have magnified the damage that one or a few sinners can do. Sadly, that is why our world is an increasingly dangerous place.

To sum up Albany in 2009: A weak governor. An appointed lieutenant governor, state comptroller and junior United States senator, with others angling to take their jobs. A senate in anarchy. An efficient assembly with some ethically challenged members. A state attorney general waiting in the wings for the collapse of the regime, whose goal is to put it out of its misery by exerting a minimum of force necessary to do the job.

We are not soothsayers, but it seems highly unlikely that anything productive in governance or finance will emerge in New York State in 2010. And who is the man who bears responsibility for much of the chaos that has ensued in the last three years? It is Eliot Spitzer, candidate for the Democratic nomination for attorney general, a position to which he was elected in 1998 and 2002. If he runs, he will certainly have name recognition the other candidates currently lack. But so did Mark Green.

Best wishes to all of you for a Happy New Year. We are fortunate that our lives do not depend on the vagaries of New York State politics. We should not be overly discouraged by the antics of politicians. We should do what we can, in a system biased in favor of incumbents and hostile to challengers, to make it possible for honest, decent and unselfish people are elected to public office. The tides bring good government in and out, reflecting the changing will of the people. It is, however, up to us to exert whatever small influence we have on the side of truth, justice and fairness.

We close with Rule 26-G: "Every day we live is a gift of God." It may be a gift of Nature, but it is still a gift which we should use as wisely as we are able.

All the best to you, your family and your friends.

StarQuest #633 12.31.2009 1684wds

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