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January 31, 2011


Cuomo breaks the mold

E.J. McMahon

The days leading up to the presentation of New York State’s Executive Budget are traditionally used by the governor’s office to leak selected details from the coming proposal. Andrew Cuomo, however, is breaking the mold.

Last Friday — Budget D-Day minus 4 — Cuomo sent the Legislature his promised property tax cap bill, which is not actually part of the budget. While this apparently came as a surprise to the Democrat-dominated Assembly, the Republican-controlled Senate immediately introduced the measure and is poised to pass it today.

This morning, barely 24 hours before presenting his budget, Cuomo issued a statement denouncing the budget process he inherited as a “sham,” professing shock to learn that spending is driven by statutory formulas, and proclaiming that a projected deficit of $10 billion may actually be as little as $1 billion.

Jaded Albany insiders (lobbyists, analysts and journalists alike) were no doubt reminded of the famous scene from Casablanca — the one in which the roulette-playing French police captain expresses his “shock” to find that gambling is going on in the back room Rick’s Cafe. The collective reaction: Who’s he kidding?

But Cuomo, it seems, is not playing to the insiders. Today’s gubernatorial statement–more of a general op-ed submission to New York newspapers, actually—appeared to be designed to both go over the heads of journalists while also getting into their heads.

Reflecting the first test of the atom bomb he helped designed, the physicist Robert Oppenheimer famously recalled a line from Hindu scripture: “Now, I am become Death, the destroyer of worlds.” Cuomo knows tomorrow’s budget coverage will cast him in the much same light — as a savage budget-cutter, destroying the worlds of everyone from pre-K school kids to elderly nursing home patients.

His statement today is a pre-emptive attempt to change that narrative. His exaggerated and dramatic tone (he compares the budget process to “schemes by lenders to exploit students, plots by insurance companies to defraud patients and attempts by Wall Street to deceive homebuyers”) is designed to send a message vivid enough to ensure it receives prominent budget-day play.  “Listen up, folks,” he’s saying.  “You’re going to start hearing a lot about devastating cuts.  You need to take it all with a grain of salt.”

The governor’s nut grafs:

The budget process is a metaphor of Albany dysfunction: special interests dominate the process with little transparency; programs continue with no accountability and the taxpayers get the exorbitant bills. The greatest challenge — and opportunity — in this year’s difficult budget is to expose this chronic problem and reform it once and for all.

[snip]

There is no such thing as “permanent” laws and they must all be reviewed and replaced or modified when necessary. The state budget should increase based on objective, fair criteria such as the rate of inflation, enrollment, the Consumer Price Index (CPI) or personal income growth. Programs should be reviewed for effectiveness and terminated if they are not working well. Reimbursement rates should be negotiated to get the best bargain. Performance should be measured.

Albany must give up its insistence on pleasing the special interests rather than serving the people. This is the real budget battle that I will wage this year. We must balance this year’s budget but we must also reform the process so that the cycle finally stops. This year’s budget is not merely about the numbers. It’s about our values and our future.

It’s smart for Cuomo to pre-frame the budget package this way.  It also logically implies he might be open to a really fundamental reform: zero-based budgeting, in which every dollar of spending is justified anew every year, rather than built into a baseline.

This is going to be interesting.

P.S. — A savvy observer points out that, having made such a big deal about the permanent statutory formulas that drive spending, Cuomo “now has to submit legislation rewriting or eliminating these formulas, one by one.  It doesn’t work to say (or even write in) that programs now will go up by the CPI unless otherwise specified. Is he going to eliminate the entire school-aid formula?  All the individual Medicaid formulas?  Maybe.  Or maybe not.”

Excellent points. If you’re going to challenge the way the state does business, you need to propose a different way of doing business—which will have implications for aid-dependent entities downstream of Albany, including but not limited to school districts.

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