Friday, March 19, 2010

The Jobs Mantra Down by the Levy

Errol Louis has an instructive column in yesterday's NY Daily News about how the Democrats in NY State need to focus, jobs, and jobs: "The election and hasty swearing-in of Jose Peralta as a new state senator - the crucial 32nd vote needed by Democrats to pass any legislation - gives the majority only a few scant months to govern before Election Day. It's an opportunity the Dems will blow unless they stick to the No. 1 issue: jobs. Nothing else comes close in importance to voters this year."

And Louis paints an appropriately grim picture of the state's economic outlook: "The soaring unemployment rate translates into an incredible 852,000 New Yorkers who are jobless statewide, 413,000 of them in the five boroughs. As of mid-January, 30,000 new jobless claims were being filed every week, 11,000 of them in New York City. The grim figures look even worse when you lump in the people so discouraged that they've stopped seeking work. That sends the true jobless rate to nearly 15%..."

We are also in agreement that the legislature needs to avoid divisive and besides the point social issues in order to fully concentrate on this core problem of work-but how we do that is where we part company with Errol:

"In a state where party labels still mean something, the Democratic brand - the party of Al Smith, FDR and Robert Kennedy - means nothing if not a commitment to putting people to work. The state Senate should debate and advance longstanding proposals to impose a dedicated tax - preferably, a gasoline tax or downstate income tax - to pay for repairs and improvements to our crumbling transportation network, especially mass transit. To help small businesses get back on their feet, the Senate should champion a state companion program to the federal Community Development Capital Initiative recently announced by President Obama. The White House plan helps small, neighborhood-based lenders like credit unions, specialized loan funds and community banks make loans available to households and small businesses that need capital to expand. A small investment of state funds would allow these lenders to toss an economic lifeline to the small firms that hire most people."

This is absolutely the wrong way to go-and anything that the president is doing on helping small business is at best a non sequitor; and at worst is like tossing an anvil to a drowning man. If we are not going to reduce the tax and regulatory burdens on small firms in order to reduce the cost of doing business in NY, than all else is simply posturing; and talking about any new tax means that you've become part of the problem and not the solution.

Some of this is underscored in an introductory editorial by the putative, and newly minted, Republican candidate for governor. As Steve Levy points out in the Daily News: "Albany legislators and governors have increased spending by an astonishing 70% over the last decade. Nothing less than extraordinary measures are needed to fix the mess. Candidates who run on nebulous platforms because they are afraid of ticking off special interests - and who won't even weigh in on Lt. Gov. Richard Ravitch's controversial but comprehensive budget plan - just won't do in this time of crisis."

So what does Levy suggest? "Cap local and state spending. In Suffolk, we put in place a spending cap that did not lead to Draconian cuts, but did force needed prioritization. This year, we froze taxes, despite having lost $100 million in sales tax revenue. A hard cap on state spending should be implemented this year. Such a cap would also give the state the moral high ground from which to pass a tax cap on our local school districts."

And Levy goes on to suggest that we need to rein in the cost of public employee salaries and benefits-and begin the process of reducing the size and scope of state government-something that Governor Christie has started to do over in New Jersey. It's about time that New York learns to do more with less-and stops the process of exporting jobs and wealth to friendlier business climes.

So, we agree with Errol Louis about what the senate Dems should be focusing on-but 14 or so of this cohort has already staked out the "no cuts to education" territory-and if we begin to protect everyone's sacred cow we end up with the Leviathan that we simply can't afford. Someone needs to speak for the small businesses and the tax payers of this state-and job growth doesn't devolve from government doing more but doing less; and getting out of the way of entrepreneurial energy.