As the NY Times is reporting, the groups who stand the most to lose if government retrenches, are fighting back: "Faced with devastating budget cuts from Gov. Andrew M. Cuomo and a deeply hostile electorate, New York’s most influential public-employee unions have unexpectedly shifted their strategy for defending cherished government programs and worker benefits. Put off for now are the angry denunciations and millions of dollars of advertisements, chiefly from hospitals and a health care union, that have traditionally begun haunting governors in early February. Instead, two coalitions of labor unions and their allies are mounting campaigns aimed chiefly at persuading Mr. Cuomo to extend the so-called millionaire’s tax, a state surcharge on high-income New Yorkers that is scheduled to expire in December. The tax, which Mr. Cuomo wants to eliminate, could bring in billions of dollars in revenue in the next few years, cushioning cuts to schools and Medicaid."
If so, this is purely face saving on the part of these groups-that's because the, "millionaire's tax," is just a drop in the bucket, and if extended wouldn't put a dent in the deficit reduction needs of the state. But let's stop for a second and question the honesty and integrity of the tax's label. This is a tax that hits a great many small business owners and farmers in New York-and it is a deterrent to economic development as a result.
But the coalitions fighting the governor see things differently-and don't believe that the government has grown too large and expensive. In fact, they see this whole budget crisis as a, "revenue," problem: "Both coalitions argue that the debate over New York’s budget crisis has unfairly scapegoated public workers while virtually ignoring the role that Wall Street risk-taking, and the accompanying financial collapse, played. They also say that what Mr. Cuomo has described as an epidemic of overspending is as much a revenue crisis driven by tax cuts for the wealthy from the Pataki era."
So, we guess that these groups think we are under taxed-which would be a shock to the small businesses and tax payers groaning under the current tax burden. But the opposition to the governor is relying on tar babying Wall Street in a nice example of misdirection: "Indeed, an early radio ad script from the group does not mention Mr. Cuomo at all. Instead, it assails “bankers, brokers and money managers” on Wall Street for collecting record pay and bonuses in the midst of a state fiscal crisis."
What's missing from the opposition's narrative is a recognition of the extent to which NY State has become uncompetitive because of its high cost of doing business-and this is especially true for the small business community. The Small Business Survival Index places NY 49 out of 50 in this regard.
In our view, these new tactics reflect the concern for the governor's legendary ability to kick butt and take names-but the grass roots strategy does make some sense because it helps the groups avoid a major backlash from a fed up public: "Some union officials and their allies say the change in strategy also reflects a recognition that the traditional winter ad wars are not without cost to themselves, both in dollars — 1199 alone has spent as much as $10 million a year out of a joint fund with the Greater New York Hospital Association — and in public relations backlash. “We have had enormous experience with the old way,” said Kenneth E. Raske, president of the hospital association. “The old way leaves a sour taste in our mouth, too. We’ve seen what happens in the past. We didn’t like the process and we didn’t like the outcome. You get some restorations, but you still end up with some difficult cuts.”
All of this means that the battle is being enjoined, and those of us who believe that the survival of the state rests on the restoration of fiscal sanity, have our work cut out for us. We can't keep spending money that we don't have, only to resort to tax policies that insure we won't have even more money to spend going forward-as businesses and even middle class tax payers flee the state.
The era of tax and spend government is over, but the rear guard action of those for whom government is a benefactor has not been defeated by any means-and we could see a reversion to the failed policies of the past if we aren't organized to do battle on these core issues. Game is definitely on-and we will be there, along with many other warriors, for the struggling small business sector.