Quite a gasp went up around the Campaign for Fiscal Equity case when New York City’s corporation council, Michael Cardozo, announced at a hearing in State Supreme Court Wednesday that the city didn’t intend to pay – didn’t think it ought to pay – one cent of the billions that the court appears to be getting ready to order spent on schools in the state and city. “If we have to pay any portion of this, no thanks,” is the way Mr. Cardozo put it.

This didn’t sit well with the president of the United Federation of Teachers, Randi Weingarten, who promptly called Mr. Cardozo’s statement not only “preposterous” and “outrageous” but also “morally bankrupt.” When we telephoned her to inquire what she was talking about, she uttered this immortal line (which will someday be repeated the way people repeat Samuel Gompers’s answer to what labor wants, “more”). Quoth the representative of our teachers: “It’s not their money.”

Now, we wonder whose money it is. Not Judge De-Grasse’s. Not Michael Rubell’s. The Legislature hasn’t got it. Nor does Mr. Pataki. Not even Mr. Bloomberg has enough money to pay this suit. In fact, it’s no one’s money – because the money doesn’t exist. Yet those pressing the Campaign for Fiscal Equity lawsuit are plunging ahead on the assumption that there’s some magical pot of gold at the end of a rainbow in Albany or City Hall.

The fact is that Mr. Cardozo’s statement was simply a recognition that the funds have to come from somewhere – and the city doesn’t have an extra $15 billion lying around. Its taxpayers are already abused. This is why he said, in a statement: “A result in this case that would force the City to shoulder the bill to make up for State historical under funding will not help the City’s school children, as the Mayor testified, because it would force the City to cut back on other services to those very children. I therefore told the court ‘no thanks’ to convey the strong sentiment of the City that we would have nothing to be thankful for if the remedy required the City and its residents to pay for it.”

He’s speaking for all residents of the city. But what about the rest of the New Yorkers in the Empire State? What’re they, chopped liver? The state is in even worse economic shape than the city. Albany is looking at a $6 billion shortfall next year. New York State is taking on water, and upstate residents are hard-pressed to find jobs and to earn a living. If New York City isn’t going to pay this bill, how in the world can anyone expect the rest of the state to pay it.

Even if the CFE lucre all comes out of the state budget, New York City residents are going to get socked at tax time. For Albany relies on New York City for about 40% of its tax revenue, and that’s not even including the areas adjacent to the city that depend on its economy. The city is the economic engine of the state. The upstate economy remains in the doldrums, losing industry and people. So if there’s a pot of gold anywhere, it’s more likely to be found in Manhattan rather than Albany.

In other words, if Mr. Cardozo wants to be taken seriously when he says that city residents shouldn’t be forced to bear the costs, the only thing he can do is to move for Justice DeGrasse to dismiss the case entirely. After all, what is the court supposed to do here? Order the state Legislature to impose new taxes? That would be taking judicial activism to absurd new heights. Under New York’s constitution, it’s the job of the governor to propose a budget and the Legislature either to turn it down or cut it down. The courts seem to assume that new funds can be litigated into existence.

The Campaign for Fiscal Equity lawsuit wasn’t always so absurd. Originally, the suit aimed at redressing the imbalance in school funding between the city and the suburbs. Litigants claimed that the state’s funding formula short-changed the city. While the judiciary is perfectly competent to address such an equal-protection claim, it’s not exactly the best place to draft a state budget. But somewhere along the way, the Campaign for Fiscal Equity lawsuit morphed into a demand for new education funds.

That’s a fine demand, but it can only be addressed to the governor and he can only propose it to the Legislature. So the Campaign for Fiscal Equity ruling has the potential not only to wreck New York’s economy, but also to overturn its constitutional balance. Mercifully, Mr. Cardozo said “No thanks.” It’s about time someone said it.