Huzzahs echoed from Baghdad to Washington when the Iraqi parliament passed a 2008 budget in a packet of measures several weeks ago.
Mind you, plenty of crucial issues were left to a future day and maybe, for all anyone can tell, to a future decade: matters like how to divide the country’s oil wealth among rivalrous groups. But, hey, the lawmakers managed, after dragging their feet, to piece together a $50 billion budget. So hurray.
Sounds a lot like Albany.
In the spirit of their Iraqi brethren, New York State lawmakers couldn’t bring themselves to vote on a crucial issue. They killed a congestion pricing plan for New York City by stealth, with no one forced to stand up and be counted in front of the voters. But, hey, they managed this week, after dragging their feet, to piece together a $122 billion budget. So hurray.
Only not everyone is cheering. Some people have trouble understanding why, when times are hard, Albany’s notion of tightening its belt is to expand its ample waist.
The state budget shares an important trait with hospital fees and college tuitions. All are somehow freed of economic constraints that apply to the rest of us.
This new budget increases spending by nearly 5 percent, well above the rate of inflation as measured by the Consumer Price Index. How many of you have seen your family’s income beat inflation to a pulp?
Through good times and bad, this has been Albany’s fiscal habit for what seems like forever.
Twenty-five years ago, it approved a budget of $31.5 billion. By applying the rate of inflation to that $31.5 billion, you would wind up this year with a budget a shade under $67 billion. Instead, the new budget is nearly twice that amount. Ten years ago, Albany spent roughly $3,900 for each New York State resident. That’s equivalent to about $5,065 in 2008 dollars. Instead, spending now averages about $6,400 per person.
Granted, not everyone buys this analysis.
“The C.P.I. measures a basket of goods and services that a family needs to buy,” said Trudi Renwick, a senior economist at the Fiscal Policy Institute, a liberal research group in Albany. The state’s needs are quite different, she said. They include health care payments, pensions and, in recent years, a batch of new responsibilities like a revised school financing formula.
“To maintain the same level of services, the state government has needed to spend more than the increase in the C.P.I.,” Ms. Renwick said. For her, a better measurement is Albany’s spending as a percentage of total personal income in the state. By that standard, the budget is “not really growing out of control,” she said. In fact, “by that measure, it’s below where it was in 1990.”
“Government spending supports all economic activity in the state,” Ms. Renwick said, “and as the economic activity increases, the need for government services also increases.”
You probably won’t be shocked to hear that not everyone agrees with her, certainly not E. J. McMahon, a senior fellow at the Manhattan Institute, a conservative research group. Far from being irrelevant, he said, the price index is “the closest measure we have for the overall cost of living” and for “what a dollar means to the taxpayer.”
Besides, Mr. McMahon said, where is it written that “the overall cost of government should be growing as fast or even faster than the economy that’s supporting it”? To assert that “government must always be some fixed share of total wealth,” he said, “takes a lot of pressure off government to run more efficiently.”
No one, Ms. Renwick included, is about to describe Albany as the most tightly run ship. Here we are in a reeling economy. So how did lawmakers economize? They added 2,000 bodies to the state payroll. Naturally, they also made sure to set aside $700 million to be showered later on the politically blessed in their districts.
They — and their counterparts in the City Council and Congress — suffer from a special form of amnesia, one peculiar to lawmakers. They believe that the cash they play with is theirs. They hand out their goodies, describing them with antiseptic terms like “earmarks” or “member items,” and forgetting that this money is yours.
But let’s look on the bright side. The new governor, David A. Paterson, vows to shake things up. Belts will truly be tightened and waists not expanded, he said the other day. And when will this new age dawn? Next year, the governor said.
Well, you never know. Maybe Iraq will have figured out what to do with its oil money by then.
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