Tax, Gamble, and Spend

This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.

The New York Sun
The New York Sun
NEW YORK SUN CONTRIBUTOR

New York State’s schools already spend $11,515 a student, more than any other state in the nation. It’s 47% more than the national average. So what did the education commission appointed by Governor Pataki recommend in its report yesterday? Between $2.5 billion and $5.6 billion a year in more spending.

In the skewed political environment of New York, the Democratic politicians and liberal interest groups responded by trashing this recommendation as unduly stingy. They want to spend $11 billion a year more on the system that already devours more than $39 billion a year in local, state, and federal taxpayer funds.

The report of the commission led by Frank Zarb wasn’t wholly without merit. It recommended “pay for performance” plans for teachers and “allowing local school districts to eliminate tenure for principals.”It recommended closing bad schools that don’t improve after three years. But the commission didn’t go anywhere near the most important reform of all, vouchers, which would introduce choice for parents of millions of poor children who don’t have it now and give the government-run schools some real competition. Where is all the additional money going to come from? The commission mentions proceeds from video lottery terminals, thereby giving the entire state education establishment a stake in statesponsored gambling, which is a regressive tax.

So the state commission led by Governor Pataki is suggesting more spending, but at least it’s not directly and openly calling for more taxes. That’s more than can be said for the Democrats on New York’s City Council, led by Speaker Gif ford Miller. Mr. Miller had lately been posturing as a tax cutter, offering a plan to reduce the property taxes in New York City that he and Mayor Bloomberg increased not so long ago. But with the Council’s budget proposal released yesterday, Mr. Miller disclosed himself as a true taxer and spender. The council budget would tax commuters $1.1 billion a year. And it would spend $581 million more than Mr. Bloomberg has proposed.

The environment in which this is all taking place is a state that, according to the Citizens Budget Commission, has the highest combined state and local tax burden in the nation. Taxes in New York City are even higher than in the rest of the state. The consequences of that could be seen in the slower economic growth of the city and state compared to the rest of the nation. The city’s economy actually shrank 2.2% in 2003, according to new numbers released yesterday by the city comptroller, Wm. Thompson. The national economy grew 3.1% during that year.

The metropolitan area’s unemployment rate in the fourth quarter of 2003, 7.3%, was higher than in any of the other 20 large urban areas except for Miami, which had a 7.6% unemployment rate. Even stereotypically blighted Rust Belt cities like Detroit, Pittsburgh, and Cleveland had lower rates. In other words, while our taxes and spending are leading the nation, so is our jobless rate. And our economic growth rate is lagging the nation. The point of this all is not to talk down New York, which is a wonderful place. But to suggest that if the politicians here, Republicans and Democrats, would ease up on their tax and spend habits, New York would be even better than it is.

The New York Sun
NEW YORK SUN CONTRIBUTOR

This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.


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