Albany Empties Of Legislators But Budget Problem Remain

A lot of video was taken, copy written and flashbulbs of cameras used in Albany this week but nothing substantive happened in terms of the budget before the whole special session was called off. Republicans may be happy they stopped Paterson this week, but the problems for New York state continue. Now that the cuts have been held off, many are trying to add their two cents to the equation before the budget is balanced next year. Robert Harding is right on with his "Cap, Cut or Tax". At a H.R. 676 rally last week I heard one speaker get the crowd going with a slogan that went something like this:

"There's no budget crisis! There's a distribution crisis!"

Before anyone screams "socialist!" at me take a breath and remember that taxes redistribute wealth, so to the conservatives out there reading this, take a breath and listen to what Dan Cantor has to say about the crisis.

From The NY Daily News:

Yes, prudent spending cuts in state spending are a necessity - that much is undeniable. But so far, the governor is asking working families to shoulder the entire burden of the budget deficit alone, while taking any income tax increase on New York's many millionaires off the table.

That is not acceptable. Not after the richest New Yorkers have seen billions in tax cuts that have slashed their income tax burden in half over the last 40 years. Not when asking those who can most afford to contribute a little more in taxes could easily prevent many of the most painful cuts being talked about in Albany.

Opponents of a tax on millionaires repeat the mantra that asking the wealthy to pay a modest increase in income taxes would drive them out of the state. But all the evidence and recent experience says that simply isn't so.

In 2003, following the economic downturn caused by the 9/11 attacks, the national recession and the burst of the dot-com bubble, New York relied on modest increases in income tax rates on the wealthy to help close its budget gap. The state employed a temporary top rate of 7.25% for single filers with incomes over $100,000 and 7.7% on income over $500,000.

The rich did not leave the state. Instead, the economy rebounded and the number of high income New Yorkers continued to grow.

And they won't leave in 2009 if we pass this tax. Then Albany needs to get their act together and make the state tax system more progressive. For far too long the rich have skated by relatively easy while the largest strain has been on the poor and middle class. The 26,000 millionaires in New York aren't going to all get up and move to New Jersey or wherever. The great majority will stay put and stay in the Empire State because it is here where they have made their money. Millionaires don't just rake in their cash by themselves, it is done based on a network of people and public services. Now it is time for them to pay their fair share, so that we can all survive and do well and not just the very wealthy.