Tuesday, April 21, 2009

Voluntary Commitment

It takes a great deal of chutzpah to launch-with great fanfare and an Uncle Sam replica of the old WW11 poster-a campaign to increase volunteerism during the country's biggest economic crisis since the Great Depression. But Mike Bloomberg certainly knows from chutzpah, and has done just that. As City Room reported yesterday: "From now on, it will be easier for New Yorkers to offer a helping hand. Heeding President Obama’s call for boosting Americans’ engagement in civic service, Mayor Michael R. Bloomberg announced a series of programs and partnerships on Monday to encourage volunteerism among city residents."

What's that old saying about imitation being the sincerest form of fakery? Whatever! The economic timing may not be the best, but the political coatailing is exquisite. As City Room points out: "The announcement came on the eve of Mr. Obama’s signing of the Serve America Act, which will expand AmeriCorps, the nation’s civilian service force, from 75,000 to 250,000 members per years over five years. The legislation essentially mobilizes what former President George W. Bush used to call “armies of compassion” to undertake some of the country’s most urgent social challenges, like shoring up communities hard hit by the recession."

But, as the NY Post underscores, the army of volunteers may be an unwanted diversion from the harsh reality of simply trying to make a living in NYC: "More than a quarter of New Yorkers are spending half their money on rent, Rep. Anthony Weiner said yesterday. He said data shows there are now more than 572,000 people in the city who have to shell out half their income on rental housing. That's up more than 82,000 in six years. "It is a startling proof point . . . that New York is more and more a difficult place to live," said Weiner.

What folks can be doing to make this a better place to live-as millions of enterprising people have done in the past to make America's free enterprise system the greatest economic engine in history-is to start businesses and employ New Yorkers; a point that is made with bite by many of the commenters to the City Room story: "Maybe Bloomberg can volunteer himself to find people what they need right now: JOBS."

And the way to do this is not by employing hundreds, and spending millions on re-election self promotion; or a "five borough economic plan" that elides the fact that NYC is one of the most expensive place to start a business-even more so since Mike Bloomberg came in on his tax raising broom eight years ago. What we need is a mayor who understands that lowering the costs of government is the first step towards economic recovery; and who knows that creating an army of volunteers in the current economic climate is at best cosmetic, but at worst a Machiavellian diversion from the current mayor's failure to have prepared the city for this crisis,

Monday, April 20, 2009

Exodus!

Coming on the heels of the excellent post editorial yesterday, the City Room decided to pose the question: How Likely Are You to Leave New York? Some of the responses are eye opening, and underscore some of the latent anger that's out there over the high cost of living-much of it imposed by government-in New York. As one commenter said: "If I did not have a grade-school aged kid (I am divorced) living with her mother in NYC, I would have left this City and State long ago!! New York State & City have become a cesspool of special interests, greed, corruption and self-serving, elected politicians."

And another respondent has this to say: "I am more inclined to leave New York of late. It seems the city and state governments are not inclined to do anything that will encourage economic growth and job creation. All they want to do is raise taxes and prices (subway) to pay for ridiculous spending programs that should be cut in these lean times."

All of which may mean that the government here-at all levels-may have reached golden goose killing time; and the idea of fair share is pretty much a self serving mantra from folks dependent on a public pay check: "We are moving to Connecticut where property taxes are lower. We think Gov. Paterson and the legislature in Albany have lost their minds. “Good riddance” indeed. With the departure of people like us, taxes for the rest of you go up. Blame it on the political class."

Are these the millionaires fleeing? Of course they're not. But the WFP and company cleverly framed the argument for political consumption. In the long run. however, they may have been too clever by half-what with more than half the jobs in the city coming from the not-for-profit and government sectors. The nagging question ahead: Who's gonna pay the freight. A fair question, if not a fair share issue.

Mayor Gasbag

You have to give Mike Bloomberg credit for consistency-and you do know that consistency is the hobgoblin of mediocre minds, don't you? This time it's the mayor's support for increasing the gas tax: "Say what you will about Mayor Bloomberg's energy policy, but at least it's consistent. Having advocated higher taxes on fuel over the summer, Bloomberg yesterday came out in support of a return to the scary days of $4-a-gallon gasoline -- regardless of its potential impact on the fragile economy."

This is from someone with one of the biggest carbon footprints in the city-you know, that regular guy who rides the subways gauging the popular will. As the NY Post reported last year: "America's greenest mayor generates enough greenhouse gas to choke the Lincoln Tunnel.
Mayor Bloomberg - who has advocated everything from ditching incandescent light bulbs to taxing Midtown commuters to clean the air - produces 364 tons of smog-inducing carbon dioxide a year, according to a Post analysis of the billionaire's trans-Atlantic real estate portfolio and travel style."

How big is the Bloomberg footprint? "That's a carbon footprint larger than what's produced by 18 average Americans, 53 Europeans or 404 Guatemalans. It's equivalent to keeping 69 cars a year on the road or lighting the Empire State Building for 4 ½ days."

But Regular Guy Mike wants the higher tax in order to promote the mass transit he fails to use on his way to privately jetting down to Bermuda; just like he wants the average shlub to pay tolls and congestion taxes to promote the elitist schemes that he himself doesn't want to apply to himself. As the Post pointed out: "Bloomberg's carbon footprint could actually be much larger. The Post did not have enough information to estimate pollution generated by Bloomberg's four personal cars, the propeller-driven airplane he owns, or the company helicopter he's said to use."

So pardon our skepticism; and it's beyond silly to think that Mike Bloomberg has a sincere bone in his regular guy body. So when will the average New Yorker realize that this poseur isn't looking out for their best interests?

Escape Artists

While all of the editorial savants are egging on the Senate Democrats to pass the Ravitch toll plan, it is instructive to take a look at the tax context of the suggestion-and the fact that New York State is already reeling from the impact of high taxes. The impact of this high tax climate is just being felt; and, as Jonathan Williams pointed out in the NY Post yesterday, it could very well lead to an exodus of the kinds of folks that the state relies on to foot its bills.

As Williams tells us: "There's an old saying that high taxes don't redistribute income, they redistribute people. Unfortunately for the hard-working taxpayers of New York, this wisdom seems to be lost on Gov. Paterson and a majority of legislators in Albany. For 2009, the Empire State earns the dubious distinction of having the worst economic outlook of any state in the nation -- 50th out of 50."

All of this, however, has been lost on legislative leaders, who have ignored the high tax burden and imposed even more taxes and fees on the state's citizens-and have used the federal stimulus money to promote higher levels of government spending while doing so. And these new taxes were imposed after New York earned its bottom rung rating; 'This is according to the American Legislative Exchange Council (ALEC), a non-partisan membership association of state legislators. And New York's dismal ranking was measured even before any of the proposed job-killing tax increases were on the table."

So how bad is the state's economic climate? "Poor labor policies, high state debt, excessive government bureaucracy, and sky-high property taxes have combined to devastate New York's economic outlook. In fact, only six states in America impose higher property tax burdens than New York. Also of particular concern are punitive state and local tax rates on personal and business income. When you add New York City's income taxes to the state's onerous levies, individuals living in Gotham paid the highest income tax rates in America last year. If you include federal taxes, companies in the Big Apple paid the highest combined corporate tax rates in the industrialized world!"

This is the underlying reality to the clarion call in support the Ravitch plan-a scheme that would add tolls, a further boost in payroll taxes, and higher fares; and its supporters are busy excoriating senate Democrats who are resisting the further burdening of their already beleaguered constituents. Wouldn't it have made greater sense for Ravitch and Governor Paterson to subsume the MTA rescue within the recently concluded budget negotiations, so that the added tax burdens could have been devoted to transit needs?

Instead, we get a budget that's been brought to New York by the taxers at the Working Families Party; and a toll/tax plan on top of this, one that, once again finds the WFP out on the streets agitating for yet another hike-this time for really hard working families of motorists. You really can't get more irresponsible than this scenario.

Taxing Our Patience

What could be less surprising? The WFP, now joined by the UFT, is looking to continue its tax raisinf binge by pressuring recalcitrant lawmakers to enact an MYA bailout plan that includes tolls. Of course, the UFT is one of the prime movers behind the WFP in the first place, so its public emergence isn't really earth shattering. Here's the NY Post's take: "The city's powerful teachers union threw its weight into the MTA bailout mess yesterday, with its boss vowing to lobby "everyone we have to" in order to spare straphangers devastating fare hikes and service cuts."

But the teacher's union is, of course, one of the prime movers behind the kind of bloated budgeting that makes tolls a "necessity" in the first place. If there was more rationality-and sanity-in how we spend the public's money; and that includes education, than there wouldn't be the dire neeed to hit commuters as hard as the Ravitch plan does. But Weingarten remains oblivious to her own culpability: "Weingarten said she called Ravitch and Working Families Party chief Dan Cantor yesterday and said the UFT will "form a coalition" that will put pressure on legislators to pass the MTA plan. "Nobody likes or wants to create tolls on the bridges," Weingarten said. "At the same time, we need to have a solution, even if it includes tolls on bridges, to keep the fare near the level it is right now. "We can't have subway and bus fares spike the way they will if the Ravitch plan isn't adopted or something like it."

Which leavea the Post in somewhat an awkward position-after it spent the last few weeks tar babbying the UFT. Here's the paper's Saturday editorial on the UFT and the MTA: "The United Federation of Teachers honcho -- only hours after this page urged her to throw labor's considerable weight behind an effort to save the MTA -- agreed to do just that." But the Post is kinda cross pressured here, and adds the following-sotto voce, if you will: "So we're glad labor groups heeded our call yesterday and stepped in to fill the void (though doubtless a big bill will be presented in due time)."

Yah think? Which is precisely why the intrepid Carl Kruger has been suffering all of the slings and arrows on this issue: "But a small number of Democratic senators opposed tolls, while others opposed the payroll tax, making it difficult for amended versions to gain traction. Ravitch offered an amended plan, which would exempt some drivers from bridge tolls and impose new fees on cab rides and a boost in Manhattan garage taxes."

Still, the Post should be more circumspect here. Empowering the UFT and the WFP on tolls, is like teasing a large cat at the zoo-eventually it will strike out at you in ways you may live to regret. So, while Paterson continues to get feisty on tolls-and the Republicans eagerly wait to pounce; the UFT/WFP folks may live to regret their over reach into the tax payers/motorists wallets.

Mayoral Control Freaks

Once again, Mike Bloomberg is placing himself between the city-and the abyss that awaits if he's not at the helm to right the ship. The issue? Mayoral control of the schools-and the NY Post has the story: "Mayor Bloomberg predicted there would be "disaster in the classroom" if state lawmakers don't extend his authority to run city schools -- and blasted critics yesterday for wanting to return to an education system that served special interests rather than kids."

This might be what passes as truth on Planet Bloomberg, but Mike needs to take a chill pill-and come back to earth. No one is suggesting an awful recrudescence of Livingston Street. As Manhattan BP Stringer told the Post: "Manhattan Borough President Scott Stringer said Bloomberg should "take a deep breath" and support proposals like his own that would extend mayoral control with tweaks to engage parents. "To educate children, you need one person in charge -- and that's the mayor," Stringer said. "The struggle now is how you re-engage parents in the education of the children. This is to complement mayoral control."

But the mayor, not renowned for his flights of fancy, simply can't help himself when it comes any challenge to his own prerogatives: ""You'd have chaos if you don't renew this law -- which expires the end of June -- because I don't how you'd put the genie back in the bottle. I don't know how you'd recreate the bureaucracy," Bloomberg said on his radio show, referring to the old Board of Education. "And all of the money that we've taken out of the bureaucracy and put in the classroom would go right away out of the classroom and back into the bureaucracy," he said."

All this from a guy who's in charge of the 78% solution-that's the amount of increased budgetary expenditures we've seen in every year since Bloomberg took charge of education; on top of a top-down management structure that shuts out parents from meaningful input. So let's jettison the Bloomberg straw men-and while we're at it, how about tuning out all of the faux common man commercials which are just as sincere as his school pronouncements. A real debate needs to take place; the Bloomberg monologue is tendentious in the extreme.

Friday, April 17, 2009

Last Rites?

The governor made a big splash yesterday with his introduction of his gay rites bill; but as the NY post points out, it's not likely that the measure will pass any time soon: "Comparing his crusade to legalize gay marriage to the country's epic civil-rights struggles, Gov. Paterson yesterday hitched his falling star to a controversial, and likely doomed, bill to allow same-sex unions in New York."

What the gambit does do, however, is to put the Democratic majority in the state senate in a worse position than it already is-coming off a budget deal that raised both taxes and spending: "Religious leaders will fight hard to defeat the bill. Archbishop Timothy Dolan spoke against gay marriage Wednesday -- the very day he was installed as head of the powerful New York Archdiocese.The bill also faces an uphill state Senate battle. Several members of Paterson's party have come out swinging against it, including Ruben Diaz of The Bronx."

But Diaz isn't alone-and now, with Senator Onorato coming out against the bill, at least five Democrats are publicly opposed. Still, the advocates somehow believe that the governor's involvement will be a difference maker. As the NY Times reports: "Gay-rights advocates expressed confidence on Thursday that Governor Paterson’s personal involvement could make a difference, despite his dismal approval ratings and struggle to advance other aspects of his agenda. They said lawmakers sometimes feel less confined by partisan loyalty on civil rights issues like same-sex marriage."

This amounts to a good deal of wishful thinking; and the senate majority is unlikely to bend to the governor's will if it means the loss of their own power-something that support of gay marriage just might accomplish, especially in some of the swing districts where Democrats remain vulnerable.

Remarkably, the Times failed to even mention these political considerations in their piece-another example of the paper's failure to cover issues where their ideological heart is on their sleeve. Instead we get: "Mr. Van Capelle and other advocates pointed out that in 2002, 13 Republicans joined 21 Democrats to pass a law that specifically banned discrimination based on sexual orientation. The outcome of that vote was in doubt until the last minute — an uncommon occurrence in Albany, where the leaders of the Senate and the Assembly rarely allow bills to reach the floor without being sure they will pass. Some supporters of same-sex marriage, most notably Mr. Paterson, are pushing for a similar approach now. By forcing a vote without knowing its result, the logic goes, dubious senators might feel pressured to support the bill for fear of appearing hostile to gay rights."

We'll see. In our view, and we're by no means instinctively hostile to the effort of the advocates, the move is premature, and will only further weaken Paterson, without advancing the advocates cause on the same sex marriage issue.

Party Pooper

Say what you want about Chris Quinn, but you can't say that the woman lacks loyalty-at least not loyalty to the man who has helped her make all of the tough decisions over the past four years; and that would be her mentor, the intrepid Mike Bloomberg. So loyal is Quinn to her tutor, that she can't say that she will support the Democratic nominee for mayor come this November: "Council Speaker Christine Quinn told voters Thursday night she couldn't promise to endorse the Democratic nominee for mayor, leaving open the possibility the city's most powerful Democratic official could endorse Mayor Bloomberg. "After the democratic process, when we know who the two individuals are who are running, whatever lines they're running on, I'm going to pick the individual who I believe is best for the city and best for the mayoralty," Quinn said at the Chelsea Reform Democratic Club's candidate forum."

What's instructive about the Quinn statement, is that it is a clear exposition of what most folks have felt since she took over as the Democratic speaker of the city council: "Councilman Tony Avella, a longshot Democratic candidate for mayor, said he's not surprised by the comments. "She's been rolling over for Mike Bloomberg on almost every sort of issue that he's brought to the forefront in the City Council," Avella said. "She does what she's told by Mike Bloomberg - I think it's unfortunate that she's turned her back on the Democratic party."

So, it's hardly surprising that the man who she has slavishly followed-even to the extent of totally flipping, and overturning the term limits concept that she had touted as sacrosanct, is someone for whom she is holding out for come the fall's election. After all, if all of the Republican Party leaders can swallow their pride and accept the Bloomberg money, why can't the Deputy Mayor for Legislation remain consistent in her support of her once and future boss.

The one thing that would complicate this eventuality, however, is Quinn's desire to remain in her current post. Snubbing the African American candidate of her own party for Daddy Bloombucks might just be enough to inspire the supine members of the council into insurrection. Our belief then, is that despite her current Mary Wells quality obeisance to her guy, Quinn will eventually support the Democrat-in what will be one of the most historically tepid displays of such allegiance in the city's history.

Thursday, April 16, 2009

A Bridge to Nowhere

You've got to admire David Paterson's timing. On the day that New York welcomes a new archbishop, the governor announces his support for same-sex marriage; an anathema to the church. Not to be outdone, he goes on to attempt to resuscitate bridge tolls on tax day! And, in our view, neither proposal will either do Paterson any political good-in spite of Errol Louis' clarion call-nor will they successfully implemented into law.

According to Louis: "If Paterson is successful, the Empire State will become by far the most populous state to sanction gay marriage, joining Connecticut, Iowa, Massachusetts and Vermont. That would catapult Paterson into the national spotlight as a civil rights champion and shore up his sagging poll numbers in advance of next year's elections."This, I think, will be the defining moment in the governor's career," said Sen. Thomas Duane, the openly gay Manhattan pol who has gamely introduced a marriage equality bill year after year since 2001, only to see it die without so much as a vote in the state Senate. "I believe that we can win this year," he told me. "I don't want to lose, and I don't think the gov can afford to lose right now."

The thought of Paterson being catapulted anywhere is intriguing, to be sure, but we can't see how this act-one of desperation for the failing governor-will be politically expedient; and with four senate Democrats already saying, no way, the chances of the measure's passage in that body are dim indeed. And Louis also underscores another point; support for the concept is very slim in the city's black community-another political pitfall for the flailing governor.

The same fate awaits tolling the East River and Harlem River bridges. As the NY Post reports: "Bridge tolls are back from the dead. Gov. Paterson is again behind a plan that would toll 13 now-free East and Harlem river bridges at the current cost of a transit ride for all drivers -- about $2 -- except those crossing the spans for medical purposes or certain business-related reasons, officials said."

How has this revival been reviewed? "Sounds to me like the plans of a lunatic," said Sen. Carl Kruger (D-Brooklyn), who helped kill the first toll proposal. Kruger accused Paterson of "some type of memory failure" for including tolls in the proposal. Kruger dismissed certain elements of the plan, like the medical exemption, as "ridiculous." Do I now have to bring a note from the doctor and bring it to Richard Ravitch?" Kruger said. "It's a flight of mental instability and it sounds like the death rattle of a dying idea."

And, even with the tolls, the transit fares will be hike 8% under this new rescue plan incarnation. Doesn't seem to be tenable, now does it? As the NY Times reports: "Seeking to win over State Senate opponents of a plan to create new bridge tolls on the East and Harlem Rivers, supporters of a financial rescue for the Metropolitan Transportation Authority offered a compromise on Wednesday that would give toll rebates to drivers traveling to medical appointments and to businesses that frequently use the river crossings. But some opponents of the tolls — which would be set to match the subway fare, currently $2 — quickly rejected the compromise, which was put forth by the state commission that proposed the original rescue plan. “I am opposed to any toll,” Ruben Diaz Sr., a senator from the Bronx, said on Wednesday. “They’re going to do a rebate? After two years they’re going to say no rebate. It’s a gimmick.”

And to keep in tune with our theme here, why does the governor who wants to find an MTA rescue compromise, push forward on a gay rights bill that will alienate one of the senators that he's trying to woo? "I think that the governor should be involved doing this now and stop pushing gay marriage,” Mr. Diaz said. The governor is expected to offer legislation on Thursday to legalize gay marriage, something that Mr. Diaz, a Pentecostal minister, fiercely opposes."

So it appears to us, that the governor's attempt to demonstrate bold leadership on two controversial issues will afford him little in the way of new support-and will only, in the end, underscore the weakness of his leadership. It's a little late for him on the leadership front, and both these proposals smack of being political Hail Mary's.

Update

We missed the NY Post editorial on this same theme: "Instead, while professing renewed support for an MTA bailout, Paterson kicks down the door and lobs in a hand grenade -- gay marriage, the one issue even more divisive than tolling the East River and Harlem River bridges."

And the Post also makes the same point we had made about annoying Senator Ruben Diaz: "But he must realize that a key player in any debate is Sen. Ruben Diaz (D-Bronx) -- who last winter threatened to withhold support for Smith as majority leader unless he got assurance that gay-marriage legislation would not be brought up in the current session. Diaz is one of several senators wavering on an MTA bailout. Those tolls weigh heavy on his district -- and now he's got another reason not to play ball."

Who's giving Paterson advice nowadays? Newt Gingrich?

A&P Disrespects It Workers

The once proud A&P supermarket company-now the owners of Pathmark Stores as well-is rapidly headed right into the toilet; and it's hard to see hoe it will survive under the current mismanagement. The latest is the company's violation of state law on worker compensation. This is from a press release from our friends over at UFCW Local 1500:

"The United Food and Commercial Workers Union Local 1500, New York State’s largest Local Union representing grocery workers, is responding quickly and aggressively to A&P Supermarkets attempt to avoid compliance with New York State labor laws. A&P Supermarkets is refusing to comply with the New York State W.A.R.N. act which requires employers to pay workers wages for 90 days after announcing the closing of a facility. A&P recently announced the closing of the Pathmark Supermarket in West Hempstead, Long Island. A&P is the parent corporation of Pathmark Supermarkets."

A&P stiffing workers? Heaven forfend! Why aren't we shocked? Well, maybe its because we worked on behalf of these deadbeats to kill a Wal-Mart Supercenter right next to a Pathmark Store in Monsey, New York-and they wouldn't pay the last three months that they owed us; leaving some local suppliers that we used in the lurch.

At some point, however, this kind of reprobate behavior has to come back to haunt this failing enterprise-and, hopefully, Local 1500 will be the harbinger of its demise: "We are extremely concerned about our members who work in that store and will do everything within our power to minimize the effect this store closing has on our members and their families,” United Food and Commercial Workers Union Local 1500 President Bruce W. Both stated. “Additionally, I am outraged, though not surprised, that A&P would take such a callous position in regards to how they are treating our members and their families."

It's time that this once proud enterprise gave up the ghost. It is being run into the ground by lawyers and accountants; and the sooner real supermarket mavens are brought in, and the current pretenders evicted, the better for all-especially the hard working supermarket workers.

My Yuengeling, My Yuengeling

As we have said all along, the expanded bottle bill will lead to the destruction of smaller beverage companies in New York State-and the process may have already begun. As Beer Business Daily reports: "Yuengling Will Pull Out of New York if UPC Law is Passed." What this means for this popular niche brew, is that it can no longer justify selling its beer in New York with the added expense that the new bottle law mandates.

As Yuengling's manager told BBD: "Pat Pikunas wrote to BBD in an email that if these laws become effective (without being amended, which there is some talk of), then Yuengling is fully prepared to withdraw their products from the state of New York. You heard that right. Writes Pat: "I can tell you that Yuengling will be one brewery that will not comply with this provision in the legislation. In fact, we have discussed internally and come to the decision that we will pull our products for sale completely in the state, if we are forced legally to comply with NY specific UPC requirements. We realize that the potential implications of this decision are far reaching and large, but feel it would be necessary given the issues it creates. "

What's more foreboding even, is that there will be scores of small beer brands, water distributors, and soda bottlers who want to do business in NYS, but will find that the extra costs are not worth the effort-something that the folks at Good-O Beverage have already told Senator Espada who represents the neighborhood were the Hispanic brands are bottled.

As Martin Salo, Good-O's vice president, told the senator:

"Good-O Beverage Co is trying to digest the devastating impact that the passage of the Expanded Bottle Bill represents. Given the nature of these impacts, a number of options are under consideration. They are:

"1) Layoffs and the scaling back of our NY operations;


2) Withdrawal: Selling product entirely in the state of New Jersey because of the burdens imposed by this bill. This would necessitate closing our Boone Avenue facility (where we have been for 50 years) and move to New Jersey to concentrate on our "Out of Town" business sales in other states where our products are also sold and where severe regulatory burdens are absent;

3) A total sale and shut down of our brands, business and operations in NY and elsewhere."

The Alliance has begun to reach out to all small beverage companies that find themselves in Good-O's dire position. Every company that we've talked to tell us that the June 1st deadline is totally absurd-no one can retrofit their containers and labels to comply with that inception date. In addition, all of the folks we talked to said that the extra expense would make it difficult for them to sell affordable beverages; and that at the end of the day, the larger beverage companies would have an added advantage.

It should also be pointed out, that all of the water companies need time to devise a collection and redemption system for their empty containers. Unlike beer and soda, these firms deliver their products through food distribution warehouses, making back hauling impossible. Third parties will have to be retained, and a system put into place-something that can't be done in the available time frame.

Something's got to give here; and the clueless folks who engineered this fiasco-like out friend Laura Haight of NYPIRG-really were without any idea about how impractical the expansion format really is. We expect that there will be changes forthcoming. If not, there will be total chaos.

Wednesday, April 15, 2009

Five Borough Fraud

The city's Economic Development Corporation has announced that it's going to subsidize the expansion of Manhattan Beer-a company that's raking in the big bucks thanks to a monopolistic distribution system that insulates the company from any meaningful competition. Another indication, in our view, that the whole IDA edifice needs overhaul.

Here's the press release-thanks to the Observer's Eliot Brown: "“Helping our vital industrial companies to remain and expand in the City is one of IDA’s primary goals and creating jobs today is a foundation of the Five Borough Economic Opportunity Plan,” said IDA Chairman Seth W. Pinsky. “The benefits approved today will help to ensure that this growing New York City-based company continues to contribute to our important industrial sector by investing in an additional location and improved equipment and creating new, quality jobs for New York City residents. I am pleased that, despite obvious advantages offered by neighboring municipalities, Manhattan Beer chooses to stay in the City and that IDA can help to make that choice viable.”

Earth to Pinsky. Manhattan Beer wasn't going anywhere-and the use of these tax subsidies, when small businesses are hurting, is simply a total waste of our tax dollars. If this is the epitome of the Bloomberg five borough economic development plan we need to continue to hand out more food stamps.

Bottled Up Logic

According to Crain's Insider (subscription), there is some speculation that the expansion of the bottle bill to bottled water will be good for smart consumer choice: "Some see the new bottle bill less as a recycling measure than as a needed curb on bottled water. Bottlers say the law, which adds nickel deposits, will increase the price of bottled water by up to 70%. “Maybe more people will make the right consumer choice and not buy bottled water,” says Rob Moore of Environmental Advocates. “For people who decide to get ripped off, it will encourage them to recycle.”

This limited world view misconstrues the fact that the introduction of bottled water has led to many folks switching from sweetened soda to the healthier alternative. The concept that consumers choosing to buy bottled water are being, "ripped off," devolves from an elitist perspective that is hostile to free markets-and derisive of the idea that the folks know what's good for them. But, hey, that's the mindset behind all of the container deposit thinking.

Garbage In, Garbage Not Out

As the NY Post reported yesterday, the cost of disposing NYC's garbage is escalating: "Garbage costs are piling up. Moving trash from a Brooklyn transfer station to other states via rail instead of traditional garbage trucks costs $134 per ton -- up from $85 per ton last year, according to the city's Independent Budget Office."

So what should the city do? Why recycle more, of course: "So the city should consider more recycling, says IBO Chief of Staff Doug Turetsky. "While it has cost more to collect and dispose of a ton of recyclables than a ton of trash, the difference is narrowing as the cost of exporting garbage to landfills and incinerators outside the city rises," Turetsky said."

To which we say, Duh! But what has Mike's Marauders actually done in this regard. We recall fondly that when the city passed its SWMP the mayor called the waste disposal blueprint, "groundbreaking." Here's what we said four years ago when all of this breathless rhetoric was being used: "As part of the Mayor’s Solid Waste Management Program he is required to address how to increase the level of recycling. In the DOS report the administration’s proposals are called “groundbreaking” (bottom of page two) but in reality they are anything but. Aside from the usual refuge of the clueless: “better education,” there is absolutely nothing said on how to enhance recycling activity. In fact, the only way these proposals could be called groundbreaking is if the mayor is digging with a plastic spoon."

The one breakthrough of this administration is the so-called fair share initiative, the one where, although no real garbage reduction has been accomplished, everyone gets to experience the pain on a more or less equal basis. So instead of pain reduction-through real recycling diversion-we get the Gansevoort Recycling Center on Manhattan's West Side. As the mayor's court historian put it last year: "The plan represented Bloomberg's answer to the looming trash crisis he inherited after then-Mayor Rudy Giuliani closed the massive Fresh Kills Landfill on Staten Island. "This is a legacy project for the mayor," Deputy Mayor for Operations Edward Skyler told The Post. "We're fundamentally handling the way the city handles its garbage, to deal with it an environmentally friendly way and not pit communities against each other."

Not a word on waste reduction-or how many more tons these geniuses have diverted; so, four years later, we get the IBO's sage advice: the city should recycle some more. And not one word on organic waste, and for good reason, since there is no diversion plan for this expensive-to -dispose waste.

Which brings us to the private sector, and the DEP's sandbagging of the pilot program to permit food waste disposers at the city's supermarkets and restaurants. As we said earlier this year: "It appears that the vaunted DEP study of the impact of commercial food waste disposers has been completed-although the agency has been quite reticent at trumpeting the results. Luckily, we have gotten some advanced news on the study's details. They are, as we predicted, almost three years ago, totally unremarkable in their self serving dishonesty. The $1million study "found" that fwds would have a "cataclysmic" impact on the sewer system; even though it did survey ten other cities were the technology is permitted, and no such dire impacts have ever been found."

So, with disposal costs escalating for both the public and the private sectors, the one methodology available that could divert thousands of tons a day-and save millions for both sectors-is abjured by stone stupid bureaucrats at the city's most dysfunctional agency. Yet this is the agency whose wisdom we're going to swallow whole?

And in the process, an innovative technology that could reduce operating costs for thousands of local businesses is thrown in the ash heap; while the mayor babbles on about his five borough economic development plan. How absolutely pathetic!

Sweet and Sour Politics

Ryan Sager has an interesting exposé on the Machiavellian nature of the efforts of Tom Frieden, the NYC Health Commissioner, to control what we eat: "Want a lesson in political cynicism, dressed up as concern for public health? Then grab the latest issue of the New England Journal of Medicine, and read city Health Commissar -- sorry, Commissioner -- Thomas Frieden's piece on how to line up support for a soda tax. His advice: Lure legislators with dollar signs -- but convince the public it's all about health."

Not that we weren't aware of this ploy from the very beginning of its introduction by Governor Paterson; after all, what kind of health measure is placed in a budget so it can generate revenues by not being an effective deterrent to behavior? By Frieden's candor is welcome-since it reveals the extent to which public health autocrats will go to control how we live: "The soda tax didn't make it into state law in the latest budget, but it's still a top priority for those like Frieden (the architect of the city's trans-fat ban) who think it's the government's role to tell all Americans what they can and can't put into their bodies."

And the good doctor believes that the tax can be revived because the folks are pretty clueless about what the tax actually means to do: "Poll results show that support of a tax on sugared beverages ranges from 37 to 72 percent," write Frieden and his co-author, a Yale professor of food policy. And when the public is clueless, you can easily manipulate it: "A poll of New York residents found that 52 percent supported a 'soda tax,' but the number rose to 72 percent when respondents were told that the revenue would be used for obesity prevention."

Which, says the manipulative meddler, is terrific in spite of the fact that this-in his view-is all a ruse because public education campaigns, you know the efforts to actually convince folks to alter some bad habits, are not normally successful: "A penny-per-ounce excise tax could reduce consumption of sugared beverages by more than 10 percent," Frieden claims. "It is difficult to imagine producing behavior change of this magnitude through education alone, even if government devoted massive resources to the task." We wonder what kind of reduction in usage would follow the threat of jail time?

And of course, Frieden knows that the money generated by a soda tax wouldn't be used for anything but budget fattening: "But if legislators are tempted by new revenue, it won't be because they want to spend it on new programs subsidizing veggies for kids (as Frieden proposes in the article). They'd use it, as happens with all funds supposedly "dedicated" to any one purpose, to plugging the state's multibillion-dollar budget gap."

So this is what passes as public health scholarship nowadays-pretty pathetic if you ask us. But, at the same time, no one is more qualified to pen this kind of sly sleight-of-hand duping of the public than the ultimate anti-business meddler-and it's the same rationale that Frieden used to promote menu labeling; and we can't wait to see the epidemiological study that emerges from this fiasco. Will it be done in time to grace the pages of a Bloomberg for Mayor brochure?-the only publication where it would pass peer review.

All we can say is that this kind of health intervention is likely to be the wave of the future-and particularly as more and more of our health benefits are controlled by the government. Remember the old maxim: He who pays the piper calls the tune.

Tuesday, April 14, 2009

Political Hermaphrodite

Thanks to Liz, we now know that Mike Bloomberg's political identity is, well, amorphous, to say the least. How else to explain his willingness to woo the Working Families line for the fall mayoral election? "Now that Mayor Bloomberg has locked down the Republican and Independence Party ballot lines in his reelection bid, he can turn his attention to a more elusive target: the labor-backed Working Families Party. Even as Bloomberg campaign aides worked to shore up GOP support, they have been quietly meeting with leaders of the WFP and key union officials whose votes will be crucial to landing the party's endorsement."

We know that politics makes strange bedfellows, but we never thought that the bed would be big enough for Mike Bloomberg and the "tax everything that moves," WFP: "One labor leader said Bloomberg's campaign has been "diligently working" the WFP's executive committee and "relentless" in its pursuit of union support. They've dispatched multiple emissaries to woo labor leaders."

All of which underscores, not that Mike Bloomberg is someone with independent political judgment, but that he is a political hermaphrodite who will align himself with anyone and anything that promotes his own self interests-which kinda describes the WFP if it decides to go with the man who seems to stand on the opposite side of the political divide from the "Millionaire Tax" Party. As the NY Times tells us this morning:

"Declaring that “we love the rich people,” Mr. Bloomberg has opposed capping executive pay, increasing the capital gains tax or raising income taxes on the wealthy. He has gushed about Treasury Secretary Timothy F. Geithner, saying he “walks on water,” and praised Henry M. Paulson Jr.’s Goldman Sachs résumé. Mr. Bloomberg, a billionaire many times over, has also vouched for vilified Wall Street titans like Richard S. Fuld Jr., the former chief executive of Lehman Brothers.“There’s Lehman Brothers, who I feel very sorry for,” he said during a news conference. “Dick Fuld, I’ve known for 40 years, who’s a competent guy, and people are criticizing him. They didn’t criticize him when things were going well for an awful lot of years.”

But the mayor thinks that all this means is that he makes no decisions based on purely political considerations-as if his own self perpetuation was an apolitical gift to New Yorkers: ""And I don't think anybody can put in the back of their minds the fact that we live in a real world where there is politics involved. And you might praise things or go to places. But any serious decision we've ever made has been without it. And I think you can just go back and take a look at a number of positions that I've taken which have not been politically popular, particularly when your newspaper is demanding I fire somebody or demanding I change my view."

Of course, with the newspaper marching in class step with their billionaire brother, we tend to believe Mike's view here; but that doesn't mean, however, that the Bloombergistas are making all the decisions strictly on "the merits." What it means often is that the mayor-belonging to a cohort of Wall Street brigands-simply decides stuff on the basis of his own narrow world view; one that is circumscribed by class and wealth. In this context, a healthy political perspective would be an improvement.

Mi Familia No Es Su Familia

The Working Families Party has got to get the prize for New York's most inaccurate political taxonomy-advocating on behalf of bigger government at the expense of some of the hardest working families in the state, the party needs to be renamed to better reflect its aims and objectives. But, even more importantly, New York's Democrats may soon be feeling the sting of voters because of their too cozy relationship with the party that is being seen as responsible for the recently concluded high tax, high spend state budget.

This is the theme of Jacob Gershman's analysis in the NY Post yesterday-and it could be seen as the handwriting on the wall: "WRACKED by a wicked hangover after a binge of wild budgeting, Democrats in Albany have opened their eyes to the behemoth lying in their bed and refusing to leave. It's the Working Families Party -- the left-wing coalition of organized labor and ACORN activists -- which seduced Democrats with its potent field operations and helped bring them to power in the Senate for the first time in generations."

This closeness could be particularly harmful for the slim majority Dems hold in the state senate: "Now, the WFP is demanding a long-term relationship -- to the alarm of Democrats, whose more moderate constituents back home are threatening to split. Democrats worry that the force behind their takeover of the Senate last year is sowing the seeds of their downfall."

There are perhaps four of five districts where Democrats could be vulnerable to the charge that they are the handmaidens of a group that holds the tax payers in contempt: "Privately, they fear that the backlash against the WFP-orchestrated state budget -- with its 9 percent spending hike and $8 billion in new taxes and fees -- has jeopardized their hold on at least three upstate seats, giving Republicans a dangerous opening."

The WFP, for its part, deserves credit for feeling the pride of authorship: "The WFP is warning Senate Democrats not to second-guess their choices. There's no turning back, says party chief Dan Cantor. "I think the Democrats should be worried. They should be praising the budget. You can't run away from your own decision," Cantor says. "If they run from it and let the Republicans misrepresent what just happened, then it gets tougher for them."

Misrepresent? Now what could Danny mean? Not that it was a good idea to grab the stimulus cash, not to keep tax increases down, but to increase spending and sock it to the already over taxed citizenry? That is, however, just what the Party means, and it believes that it is a winning political strategy: "And to Democrats nervous about the outpouring of rage from constituents, Cantor preaches a message of patience: "The society is drenched in anti-tax dogma, so it's understandable that making the case for a more just sharing of the burden is going to take some time."

This guy clearly hasn't seen how New York compares to other states-even to the one that used to be labeled Taxsachusetts. And just maybe the tax revolution that has launched the Tea Party phenomenon will be slower to tack hold in the liberal environs of New York, but even here a strong backlash from a public that is tired of being a big government piñata is not out of the realm of possibility-and certainly not in some of the state's swing districts. We'll see what 2010 brings; bu the part needs to be very careful here.

Monday, April 13, 2009

Tip of the Iceberg

Dave Seifman at the NY Post has underscored what we believe is endemic to the royal rein of Mike the First-the use of his vast fortune to suborn the democratic process. In the case that Seifman highlights the results will mean higher water bills for New Yorkers-count on it: "ONE of the newest members of the city's Water Board is going to have a hard time rejecting the administration's request for a 14 percent hike in water and sewer rates next month, because Mayor Bloomberg is appearing at a fund-raiser for the nonprofit she heads just two weeks later."

Who's the conflicted gal? None other than our old friend Marcia Bystryn, the head honcho over at the League of Conservation Voters: "The vote on what would be the third double-digit increase in water fees in as many years is scheduled for May 15. Just 13 days later, Bloomberg is supposed to attend the annual fund-raising bash of the New York League of Conservation Voters at Chelsea Piers. The executive director of the league is Marcia Bystryn, who was named to the seven-member Water Board on Dec. 17."

Where's the conflict here? Just follow the moolah-with the stated sum probably only scratching the surface of the mayor's money machinations: "But the mayor's attendance at her event isn't the only reason Bystryn might want to think twice about going against the administration. The largest individual contributor to her group's political action committee, Climate Action, is none other than Thomas Secunda, co-founder of Bloomberg LP. Records show he wrote a $20,000 check to the PAC on Nov. 12. The previous year he forked over $10,000."

So we now see just a glimpse of how Kermit the Mayor's green machine operates; and the rationale for the outpouring of environmental euphoria over Bloomberg's congestion tax becomes manifest. More evidence that the mayor's retinue is a product, not of love and affection, but of that old cash nexus.

Pinnochio Bloomberg

As the NY Times reported on Saturday, the mayor is threatened with an elongated nose if he keeps claiming that he's going to "create or save' 400,000 jobs over the next six years: "The optimistic note, which implies a net gain of 100,000 jobs by 2015, seems to contradict most projections of employment in the city, including those from the mayor’s own office. In January, the city’s Office of Management and Budget forecast that there would be fewer jobs in the city at the end of 2013 — nearly five years off — than there are now."

Really? We are shocked and dismayed that the mayor is, once again, playing fast and loose with the truth as he uses figures to flim flam New Yorkers about what he has done, and what he claims he will do, to make all of our lives better. From school test scores to economic forecasting, whenever Bloomberg speaks, it's best that you hold tight to your wallet-since the only real positive economic impact he has had comes, every four years like clockwork, from his periodic electoral spending sprees.

So as far as forecasting is concerned, even the TV weather folks do a better job-and that's a low bar indeed. The Independent Budget Office has a, well, independent, and more accurate forecast: "The city’s Independent Budget Office expects the job losses to continue until the middle of next year. After that, employment growth in the city will lag behind the national recovery, said George Sweeting, deputy director of the budget office. “The city went into this late, and we think it’s going to come out late,” Mr. Sweeting said. He added that according to his office’s forecast, “by the end of 2013, we’re still not back to where we were at the end of the first quarter of 2008.”

And just how does the mayor expect to carry out this economic legerdemain? With the same "five borough plan" that he touted during the last election cycle? And the last uptick in employment came after 9/11, with a resurgent Wall Street-a phenomenon unlikely to repeat itself any time son. And Bloomberg the Commoner doesn't want anyone to associate him too closely to the reviled financiers.

Apparently, according to the $100 million fable, this child of Wall Street was abandoned by his parents at an early age, and no longer wants to acknowledge this tainted paternity. Better to don shirt sleeves and pretend an affinity for the city's common folks-a pretense akin to Bernie Madoff claiming financial probity.

But nothing that has any close proximity to veracity is ever in the Bloomberg repertoire-and the same holds true for this latest nose lengthener: "Even if Mr. Bloomberg is re-elected, he would be out of office before his promise could be tested. And, as N. Gregory Mankiw, a Harvard economist, pointed out, he could always fall back on the phrase “create or save” 400,000 jobs. “Absent a parallel universe in which there was another New York City,” Mr. Mankiw said, there would be no way to measure how many jobs had actually been saved by Mr. Bloomberg’s actions."

The perfect scenario for a serial prevaricator, isn't it? And when you have $100 million to spend on the prevarication, what chance does the truth really have?

Schools for Scoundrels

We have been commenting for a long time about the overly hyped nature of the mayor's stewardship of our city's schools. Never has their been more hoopla-smoke and mirrors-over the supposedly stellar turn around performance of the schools under the Bloomberg regime, Sadly, the reality contrasts so strongly with the performance reality, that it reaches a level of consumer fraud; and the incisive evaluation of this performance by Diane Ravitch in the NY Times last week underscores exactly what we're talking about.

Ravitch tackles the twin Bloomberg/Klein myths-test score and graduation rates are up dramatically; myths that our new education secretary swallowed whole: "ARNE DUNCAN, the secretary of education, has urged the nation’s mayors to take control of their public schools so that they can impose radical reforms. He points to New York City as a prime example of a school system that made sharp improvements under mayoral control. Actually, the record on mayoral control of schools is unimpressive. Eleven big-city school districts take part in the federal test called the National Assessment of Educational Progress. Two of the lowest-performing cities — Chicago and Cleveland — have mayoral control. The two highest-performing cities — Austin, Tex., and Charlotte, N.C. — do not."

So what about the test scores? As Ravitch points out (and as we have tried to highlight for a while): "On the federal National Assessment of Educational Progress — widely acknowledged as the gold standard of the testing industry — New York City showed almost no academic improvement between 2003, when the mayor’s reforms were introduced, and 2007. There were no significant gains for New York City’s students — black, Hispanic, white, Asian or lower-income — in fourth-grade reading, eighth-grade reading or eighth-grade mathematics. In fourth-grade math, pupils showed significant gains (although the validity of this is suspect because an unusually large proportion — 25 percent — of students were given extra time and help). The federal test reported no narrowing of the achievement gap between white students and minority students."

Yet Mr Duncan, just like the toadies who own the city's tabloids, waxes eloquent, demanding that the mayor keep control-or else allow the poor kiddies to sentenced to education hell: "Mr. Bloomberg’s allies say that the results of the current system are so spectacular that the law should be renewed without change. Secretary Duncan agrees: “I’m looking at the data here in front of me,” he said while in New York. “Graduation rates are up. Test scores are up ... By every measure, that’s real progress.” It sounds good, but in fact no independent source has verified such claims."

Of course, like all C students, the mayor and his sycophants would like to be able to mark their own exams: "The city’s Department of Education belittles the federal test scores and focuses on the assessments given by New York State. And, indeed, the state scores have soared in recent years, not only in the city but also across New York state However, the statewide scores on the N.A.E.P. are as flat as New York City’s. Our state tests are, unfortunately, exemplars of grade inflation." Ask the teachers about the nature of these tests.

But more kids are graduating, right? Here's another are where, if this was the marketing of a product for sale to the public, the Better Business Bureau would be called on to intervene in order to expose consumer fraud: "The graduation rate is another area in which progress has been overstated. The city says the rate climbed to 62 percent from 53 percent between 2003 and 2007; the state’s Department of Education, which uses a different formula, says the city’s rose to 52 percent, from 44 percent. Either way, the city’s graduation rate is no better than that of Mississippi, which spends about a third of what New York City spends per pupil."

And keep in mind that this performance level is being achieved with a budget that is 78% higher than when Bloomberg first came into office in 2002. It should also be pointed out, that the graduation rates-as dubious as they appear to be-are actually tinkered with: "Moreover, the city’s graduation rates have been pumped up with a variety of dubious means, like “credit recovery,” in which students who fail a course can get full credit if they agree to take a three-day makeup program or turn in an independent project. In addition, the city counts as graduates the students who dropped out and obtained a graduate-equivalency degree."

But rates are just that; indicators of those who are given diplomas, but not great indicators of whose being actually educated: "Even those who manage to graduate from our high schools are often not ready for college. Three-quarters of the graduates fail their placement examinations at the City University of New York’s community colleges and require remediation in basic skills. These are students who presumably passed five Regents examinations to graduate yet cannot read or write or do mathematics up to the standards of a two-year community college. This reflects as poorly on the Regents examinations as it does on the city’s promotional policies."

So what needs to be done? Ravitch rejects the straw man arguments of the mayor's claque-folks who see any diminution of Bloomberg's dictatorial control as a swift passage back to "the bad old days." What she sees most needed is a system of checks and balances" "This is not to say that Albany should eliminate mayoral control — nobody wants to return to the status quo of the ’90s. However, as legislators refine the law, they should establish clear checks and balances. The mayor should be authorized to appoint an independent Board of Education, whose members would serve for a set term. Candidates for the board should be evaluated by a blue-ribbon panel so that no mayor can stack it with friends. That board should appoint the chancellor, and his or her first responsibility must be to the children and their schools, not to the mayor."

Transparency and independent review-two desiderata that we have said are key-are Ravitch's watchwords: "Not every school problem can be solved by changes in governance. But to establish accountability, transparency and the legitimacy that comes with public participation, the Legislature should act promptly to restore public oversight of public education. As we all learned in civics class, checks and balances are vital to democracy."

The Ravitch critique-and Andy Wolf's as well-should inform the Albany debate; and the loud and boisterous sycophancy of the local papers should be eschewed in favor of a systematic reform that check mayoral excess while giving the public the kind of accurate information it can use to properly evaluate just how well the schools are functioning. Anything less, simply perpetuates the current schools for scoundrels milieu that the flim flammers would like us not to see.

Coming Soon: The NYPIRG Tax

No one deserves more credit-or blame-than NYPIRG, the inappropriately named New York Public Interest Research Group, for the expansion of the state's bottle law; the group's website promotes it, and the omnipresent Laura Haight, NYPIRG's lobbyist was the prime mover for the legislation. So, once the bill does to into effect-it adds water, a "NY Only" label, an additional penny and one half for handling, and a clause that lets the state take almost all of the unredeemed deposits-and the cost of water rises by over 50%, along with a minimum $2/case rise in the cost of beer and soda, the resulting increase must be labeled, the "NYPIRG tax."

For it was NYPIRG that, while it promoted the expansion, was able to drown out the chorus of voices telling the governor and the legislature that the newly expanded measure would sock it directly to the state's beverage consumers. But it won't be beverage consumers alone who will bear the brunt of this ill conceived policy. The unintended consequences of the law will be that scores of small beverage manufacturers and distributors will be faced with the kind of additional costs that will put many-if not the majority-on the verge of extinction.

Which is precisely what happened in 1982 when the bottle law was first passed. At the time , there were many smaller niche soda brands that were being sold at reduced cost to price conscious consumers. C&C, Shasta, and White Rock were all over the place-along with smaller beer brands such as Schmidt's and Pabst. To find these brands now you need to be an urban explorer.

As city stores were forced to find the space for mandatory redemption, they began to eliminate smaller brands-since the larger soda companies could provide them with a full range of flavors, thus obviating the need for additional space constraining bags and boxes for those smaller brands' empties. The same process will soon repeat itself since the regulatory costs of expansion will hurt the smaller brands disproportionately.

Asking a small woman and minority owned company like Top Pop to have a separate New York label and UPC code-and to do so by the totally impractical June 1st inception date-will add so much expense that it will be unable to continue to provide affordable drinks to low income consumers; a death sentence for the company. Similarly, Good-O Beverage, the largest Hispanic operated soda company in the area, uses the unredeemed deposits to be able to distribute full goods and collect empty containers in a cost effective manner. As with many of these smaller soda companies, the unredeemed deposits are a lifeline to marginal profitability.

As a result, if the law is not appropriately amended to address these issues, there will be an exodus of small and minority owned soda companies from the area-in effect enhancing the market share of all of the big players. As for all of these big players, there's unanimity: the costs will be great and they will be bone by consumers.

And since the majority of beer and soda consumers tend to be lower income folks, what we will see is a massive regressive tax; and we're not even taking into consideration the increase in the state's beer tax that was included in the recently negotiated budget. As last week's Times Union article pointed out: "The idea behind the separate UPC code, say those familiar with the legislation, was to prevent people from collecting deposit refunds in New York for bottles they bought in neighboring states, such as Pennsylvania or New Jersey, that did not charge a deposit. Brewers also will need to establish separate labeling and distribution for beer to be sold in New York. "We're going to have to change our labeling, and that's going to be a costly factor in the equation," said David Katleski, president of the New York State Brewers Association, who operates Empire Brewing Co. in Syracuse."

And the costs will escalate all across the board; and we're predicting that the $4 case of water will soon become a relic-an artifact of a bygone era; with $7 or $8 case prices becoming the norm. So when small brewers, soda bottlers and distributors close-and when the price of your favorite beverage goes through the roof-you can give a big shout out to Laura Haight of NYPIRG, the queen of the anti-business zealots, and the champion of regressive taxes for all poor New Yorkers.

Saturday, April 11, 2009

Unshared Sacrifice

The mantra of the tax and spenders is, of course, "shared sacrifice," a slogan bereft of its real meaning after it has been squeezed through an ideological blender by the Working Families Party. As the Wall Street Journal highlights: "In New York, Assembly Speaker (and de facto Governor) Sheldon Silver and other Democrats will impose a two percentage point "millionaire tax" on New Yorkers who earn more than $200,000 a year ($300,000 for couples). This will lift the top state tax rate to 8.97% and the New York City rate to 12.62%. Since capital gains and dividends are taxed as ordinary income, New York will impose the nation's highest taxes on investment income -- at a time when Wall Street is in jeopardy of losing its status as the world's financial capital."

But this income tax heist isn't the end of the legislative high jacking: "Oh, and it isn't just high earners who get smacked. The new budget raises another $2 billion or so on top of the $4 billion in income taxes with some 100 new taxes, fees, fines, surcharges and penalties to be paid by all New York residents. There are new charges for cell phone usage, fishing permits, health insurance (the "sick tax"), electric bills, and on bottled water, cigars, beer and wine. A New York Post analysis found that a typical family of four with an income below $100,000 would pay more than $800 a year in higher taxes and fees."

So New Yorkers at all levels of the wage scale will be hit-even while the federal stimulus money is used to increase government spending in an economic meltdown. But, as taxes hit all up and down the income ladder, we at least have achieved a sharing of the pain, right? Well, not quite; as it turns out, the cheerleaders for higher taxes and for the sharing of sacrifice have been themselves granted immunity: "This is advertised as a plan of "shared sacrifice," but the group that is most responsible for New York's budget woes, the all-powerful public employee unions, somehow walk out of this with a 3% pay increase. The state is receiving an estimated $10 billion in federal stimulus money, and Democrats are spending every cent while raising the state budget by 9%. Then they insist with a straight face that taxes are the only way to close the budget deficit."

All of which is a road to ruin for the state's once great economy-with the over reliance on Wall Street an artifact of history: "And so Albany is about to make a gigantic gamble on New York's economic future. The gamble is that the state with the highest cost of doing business can raise taxes on everyone who lives, works, breathes, eats or drinks in the state and not pay a heavy price for it. If they're wrong, New York will enhance its reputation as the Empire in Decline State."

Only when the state gets a real leader, someone who can represent New York's forgotten men and woman-the tax payers and small business owners-will be able to emerge from the fiscal morass that pawnshop politicians have gotten us into. 2010 can't come soon enough.

Thursday, April 09, 2009

Anne on the Money

In a Viewsday post, Anne Michaud made the following crucial point: "Here's a question for those of you keeping score at home. Why is New York's $132 billion state budget so much larger than those of other big states? California has nearly twice the population, with 36 million residents (New York is home to 19 million). But the Golden State's budget this year is $110 billion. Texas, which has a population of 23 million, is getting by on $91 billion annually."

Why indeed. Which makes ersatz all of the WFP palaver over the notion of "fair share." The issue is that New York State is an overly large and bureaucratic enterprise that needs to be cut down to a more manageable size before Leviathan gobbles up all of our tax dollars and sends business packing out of state. With Wall Street down, and maybe out, the old cash cows are gone-and with them, we need to jettison the sacred cows of wasteful spending and ruinous taxation.

This, obviously, is a task that is way beyond the capabilities of our current accidental governor. As the NY Post observes this morning: "Gov. Dave, on the other hand, has things exactly backward: Albany agreed on a new budget last week without making any economies whatsoever...Now, in his year-plus in office, Paterson has folded like a Japanese fan so often that it's hard to know where this will end."

And, as Michaud points out, this wastefulness can be partially attributed to New York's penchant for having what seems to be a government entity on every street: "What is it about New York that sends the numbers soaring? Is it because we have so many small governments -- sewer, water and fire districts, towns and villages -- layered on top of one another? Surely, it must cost more to maintain that infrastructure. Are we getting better services for our money here?"

So let's can all of the fair share BS, and focus on the real problem-a big wasteful government that burdens all tax payers with an unfair looting of their hard earned dough. Now rectifying that situation would be real social justice!

Sweet Science?

The city's Busybody-in-Chief is back at it. Our Health Commissioner Tom Frieden is once gain out to do damage to the city's small businesses at a time when they can least afford any of his no nothing bureaucratic meddling. This time, it's not salt that he's after, it's sugar-leading us to wonder if the good doctor will soon be monitoring everything that we decide to put into our own mouths. As the NY Times reports: "A month after Gov. David A. Paterson dropped his proposal for a soda tax, New York City’s health commissioner has written an article advocating “hefty” taxes on sodas and sports drinks containing sugar. Such a tax, the article said, could be the biggest boon to public health since tobacco taxes."

This is the same guy who, with absolutely no scientific evidence to back it up, claimed that lowering the salt intake of New Yorkers would, "...lower health care costs and prevent 150,000 premature deaths every year.” This guy quack more than the AFLAC duck-making absurd claims with no back-up. But why should he have to? After all, he's given carte blanche by Mother Bloomberg to conduct experiments on unwilling New Yorkers without their consent.

The reality here is that if there was a Nutrition Czar who could, through edict and fiat, determine everything you could legally consume, you might be able to lower health costs and prevent a certain number of premature deaths. The collateral damage to our basic liberty would, however, be far greater-and Frieden's so-called health initiatives are an integral part of a political project that wants to reduce us all to unthinking subjects. And if the federal government takes over health care in this country, this is what we will have in store: the Dr. Friedens of the world telling us how we need to behave if we want to access the "benefits" that the government offers.

And, as he does always, Frieden eschews the "too difficult" task of education and public scolding: "It is difficult to imagine producing behavior change of this magnitude through education alone, even if government devoted massive resources to the task,” said the article, published in the journal’s April 30 issue and released online Wednesday. “Only heftier taxes will significantly reduce consumption.”

Message to Frieden: if "heftier taxes" lead to lay offs and resultant job loss it will be a decidedly unhealthy outcome for New York. And this would be on top of the loss of our basic freedom to decide what we'd like to eat and how we want to live-something that Frieden feels is insignificant in the pursuit of his Brave New World vision of healthy living.