With New York’s future at risk, Gov. Pataki and Mayor Bloomberg are taking sharply contrasting approaches to closing huge budget gaps.

Or are they?

Pataki has positioned himself as the born-again fiscal conservative, stressing the need for spending restraint to avoid “job-killing” tax hikes.

Bloomberg, the self-professed liberal, has defended the efficiency of city government while imposing a record $1.7 billion property-tax increase.

But on closer inspection, the differences get blurry. For example, although his budget would press forward with $177 million in scheduled tax cuts, Pataki is also calling for $1.4 billion in new taxes and fees – the biggest such package since Mario Cuomo’s “big ugly” budgets of the early 1990s.

Despite all the headlines about “cuts” and “pain,” spending would (at best) remain virtually flat next year under both the Pataki and Bloomberg budgets. The governor, however, is doing little to permanently bring spending under control.

In fact, during the two “out years” after fiscal 2003-04, the overall state budget will be on track to grow by 8.2 percent – including an eye-popping 14 percent in spending from the tax-supported general fund. Bloomberg’s city budget for the same period is projected to rise by a total of 5.5 percent.

To be sure, Pataki is right and Bloomberg dead wrong on the crucial issue of avoiding broad-based tax hikes, which would damage New York’s economy. But the governor will find it much easier to actually live up to his anti-tax rhetoric, now and in the future, if he follows the mayor’s lead in at least two areas:

Labor productivity: Bloomberg is belatedly turning up the heat on city employee unions to deliver $600 million in permanent concessions – implying that if he doesn’t get it, he’ll have to eliminate another 12,000 positions.

Pataki is taking a much more easygoing approach to workforce issues, barely hinting that Albany’s politically powerful unions have any role to play in helping to close the state’s massive budget gap. Having reduced the headcount significantly during his first two years in office, the governor seems content to rest on his laurels and settle for a minor additional downsizing and reorganization of state agencies in the year ahead. The word “productivity” was conspicuously absent from his budget message.

With the state’s major employee contracts all due to expire at the end of March, Pataki could achieve significant savings by pursuing the same general collective-bargaining objectives as Bloomberg – such as lengthening the work day and eliminating automatic pay increases based on longevity.

The governor should also join the mayor in seeking reform of New York’s unaffordably generous public-employee-pension system – another issue on which Pataki so far has been silent.

Medicaid: New York’s outlandishly high spending on this program – more than California and Texas combined – is again in danger of spiraling out of control after a period of relative stability earlier in Pataki’s tenure.

Bloomberg has joined county executives from around the state in asking for Medicaid cuts that would save the city alone $200 million a year on a recurring basis. But Pataki appears to have ignored most of their ideas, instead trotting out a $1 billion Medicaid “savings and realignment” plan that appears to do relatively little for the counties, and may actually add to the city’s burden.

At a minimum, the governor needs to revive the kind of Medicaid cost-containment proposals he was willing to advance in 1995 and 1996, including the elimination of some optional services. This approach would result in real, permanent savings for the state, city and counties. Anything less will lend more credence to the notion that Pataki is less interested in cutting costs than in shifting them to local taxpayers.

On balance, Pataki is at least talking a better game than Bloomberg on the make-or-break issue of taxes and the economy. But the governor’s inability to match even the mayor’s all-too-modest savings goals in some key categories is not an encouraging sign for the future.

About the Author

E.J. McMahon

Edmund J. McMahon is Empire Center's founder and a senior fellow.

Read more by E.J. McMahon

You may also like

Bear market spells big trouble for NY state and city budgets

Wall Street generates an outsized share of New York’s tax revenue, so the recent drop in stock prices should worry both Gov. Kathy Hochul and Mayor Eric Adams. Read More

Calling Tax Cut “Theft,” Cuomo Continues to Push For Federal Bucks With Phony Math

The results of this week’s Georgia Senate runoffs, assuring Democrats will soon control both houses of Congress, as well as the White House, had to come as a huge relief to Gov. Andrew Cuomo. Read More

Students Need Reforms, Not HEROES

Families and businesses are watching their bottom lines and stretching each dollar. But House Democrats are pushing a plan to prevent America’s schools from doing the same thing. Read More

Washington shouldn’t fund NY’s “normal” budgets

With the coronavirus lockdown continuing to erode tax revenues, Gov. Andrew Cuomo has turned up the volume on his demands for a federal bailout of the New York state budget. In a weekend briefing, the governor repeated his estimate that the Empire State will need help closing a deficit of $10 billion to $15 billion. “I don’t have any funding to do what I normally do,” he said. Read More

Cuomo’s Plate Spinning

Governor Cuomo’s license plate design contest was a PR ploy masking a nickel-and-dime revenue raiser. Read More

How Cuomo is cooking New York’s books

When lawmakers in Albany passed the state budget last spring, Gov. Andrew Cuomo declared it “both timely and fiscally responsible.” Timely was true enough. But fiscally responsible? Not so much. Read More

Cuomo’s SALT Flop

By midnight Monday, more than 9 million New Yorkers will have filed their income tax returns for 2018. And most will then have cause to wonder what the Great New York SALT Panic of 2018 was all about. Read More

New York is looking at an ocean of red ink

New York’s new budget — the actual state-government expenditure plan, that is, as opposed to numerous side issues packaged with it — apparently came in close to Gov. Andrew Cuomo’s bottom line. Read More


Sign up to receive updates about Empire Center research, news and events in your email.


Empire Center for Public Policy
30 South Pearl St.
Suite 1210
Albany, NY 12207

Phone: 518-434-3100

General Inquiries: Info@EmpireCenter.org

Press Inquiries: Press@EmpireCenter.org


The Empire Center is an independent, non-partisan, non-profit think tank located in Albany, New York. Our mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government.

Empire Center Logo Enjoying our work? Sign up for email alerts on our latest news and research.
Together, we can make New York a better place to live and work!