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New York Budget Rebooted

April 25, 2008

Albany, NY - Gov. David Paterson sent out a fiscal SOS Thursday, calling for a special legislative session to reconsider the recently passed state budget, which is facing a $5 billion deficit. Earlier this week Paterson froze non-essential hirings and ordered across-the-board spending cuts of 3.33 percent for all state agencies.

Ron Deutsch with New Yorkers for Fiscal Fairness says the governor's economic surgery is like using a sledgehammer for a scalpel.

"You have to make the determination: Do we cut services, or do we increase revenues? We would suggest that in a downturn in the economy, it's actually better to increase taxes on the wealthiest, as opposed to cutting services. When you're cutting services, you're taking dollar-for-dollar oftentimes out of the local economy."


In addition to a 1 percent tax increase for those making more than $1 million a year, Deutsch also recommends eliminating corporate subsidies and the outsourcing of state jobs.

"We also proposed eliminating many of the pricey private contracts with consultants. We have these 'sweetheart deals' to the tune of about $500 million a year, where many private consultants are getting jobs that state workers should in fact be doing."

The budget cuts could fall hardest on New Yorkers hit by hard times. Anne Erickson with the Empire Justice Center argues the governor has cut $8 million from a fund that provides lawyers for citizens who would otherwise be unrepresented in civil lawsuits and applications for family assistance.

"It might be a family facing foreclosure because they were victims of the sub-prime lending scams being denied unemployment benefits, being denied their health care benefits. We have regulations, but when those supports are denied, you don't have a right to have an attorney to help you get through those systems."

Paterson believes budget cuts are needed now "to attack next year's deficit instead of ignoring it." His mid-year budget review would have to be considered by the legislature before it adjourns in June.

Robert Knight/Craig Eicher, Public News Service - NY