BALCONY - Business and Labor Coalition of New York

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May 15th, 2010

Here are two important dates to keep in mind. April 1. That’s when New York State was supposed to have a new budget. And June 1. That’s when the state is scheduled to make a payment to local schools that is about $1 billion more than the cash on hand.

Forty-five days after the April deadline and Gov. David Paterson and the leaders of the Legislature can’t agree on how to close a $9.2 billion deficit in the $136 billion budget. What are they doing? Blaming each other and hoping the economy will bounce back or that somehow they can put off painful decisions until after the election. The way we hear it, they’re not even negotiating in person.

We rarely agree with anybody in Albany, but they’re right about one thing: They’re all at fault. They need to get to work, now. More specifically:

THE GOVERNOR Mr. Paterson’s original budget in January spared almost nobody. But he hasn’t gotten anyone else to sign on.

Mr. Paterson doesn’t have much clout as he fights accusations that he tried to protect a top aide from charges of domestic violence. But he is still the governor, and he needs to act like it. He needs to call in all of the state’s top players, including the unions, and demand that they keep talking until they have a workable deal. He can then hand over the negotiations to Lt. Gov. Richard Ravitch, who knows budgeting and may have the only real plan for righting the state’s finances.

THE ASSEMBLY SPEAKER Sheldon Silver and his fellow Democrats have adopted most of the Ravitch plan, including short-term borrowing and modernization of the state’s budget process. But their budget proposal is still too generous, especially to the state’s unions.

Mr. Silver needs to get into that room and promote the interests of all New Yorkers. He is the right person to tell the unions that they have to do their share — agreeing to make modest contributions to their health care (like most other workers) or delayed pay raises and almost certainly furloughs.

To spread the pain fairly, Mr. Silver should be promoting luxury taxes, sales of wine in grocery stores and a fat tax on sodas. Ideally, New York’s income taxes should be made fairer. But this is not a state government that has the time or will to do the hard overhaul. Even a small short-term income tax surcharge on the rich would help.

THE SENATE DEMOCRATIC LEADER John Sampson can’t control his caucus. There are 32 Senate Democrats and 30 Republicans, and (as we have already seen) any self-absorbed Democrat can defect and cause trouble.

The Senate’s budget proposal is, to put it generously, wacky. It calls for closing this year’s deficit by taking out long-term loans that will increase the state’s interest liabilities for decades to come. Senators in Long Island and the suburbs are demanding property tax relief that would only widen the huge budget gap. Mr. Sampson should concentrate on keeping his members quiet while the Assembly and the governor agree on a budget. Then Mr. Paterson, Mr. Silver and Mr. Sampson can try to shame Senate Democrats into approving the deal.

SENATE REPUBLICANS They complain constantly that no one is consulting them. That’s true. They need to come into the room with real ideas for raising revenue and cutting spending. So far, all they want to do is cut property taxes and raise money for schools.

UNION LEADERS They may think they got a big win this week when a court rejected Mr. Paterson’s proposal to furlough state workers one day every week to save about $30 million. But, if this drags on much longer, Governor Paterson will have no choice but to start laying off people. It is time for the unions to stop waving around lawsuits and start negotiating seriously.

NEW YORK’S VOTERS Keep two more dates in mind. Primary day, Sept. 14. And Election Day, Nov. 2.