Nicole is in today’s New York Post with an op-ed highlighting the weaknesses of the “doomsday budget” unveiled last Friday by Mayor Bloomberg.

Her key point:

With Wall Street self-destroyed, New York must get used to a vastly different future. Yet Bloomberg made only modest overtures toward acknowledging that things likely have changed forever.

Yes, he brought up the specter of municipal bankruptcy unless the city makes huge changes – but he’s still asking for far greater sacrifice from the public and the ailing private sector than from the outsized public sector.

Nicole wraps it all up by citing an aspect of the mayor’s fiscal projections that has been almost lost in the shuffle of alarmist news coverage: Bloomberg’s “inexplicable expectation of a huge improvement in the budget in just 16 months.”  Starting in mid-2010, Nicole notes, the mayor “expects 8.4 percent growth in existing tax revenue, driven by a 20.1 percent gain from the personal-income tax.”

But Friday the mayor pointed to a chart of the more modest Wall Street profits from a generation ago and said that when surviving firms recover, they might recover only to such profit levels. Why expect a personal-income boom?

[snip]

So it would be safer to assume nothing. That, and not counting on a permanent sales-tax hike, would make the deficit balloon to nearly $7 billion by then, instead of $3.2 billion. Such numbers would make it harder for labor, the City Council (and everyone else, too) to dodge real reforms.

About the Author

E.J. McMahon

Edmund J. McMahon is the Empire Center’s founder and research director.

Read more by E.J. McMahon

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