Spitzer’s Spending Spree

In 1975, Governor Hugh Carey, in his inaugural address, proclaimed that “the days of wine and roses are over.” It’s time for Eliot Spitzer to learn from Hugh Carey and prepare the state legislators for the tough times that may lie ahead.

New York State’s projected revenues continue to edge lower, in keeping with over 20 other states that have been hard hit by the downturn in the national economy. Unfortunately, Governor Spitzer is behaving more like a man with cash to burn than the chief executive of a state facing serious fiscal challenges.

In the past month, estimates of New York’s projected revenues have dropped by some $634 million, while job growth is declining. Yet Mr. Spitzer wants to add $6 billion to the $118 billion budget and hire 2,000 new state workers. His proposed increase in spending gallops along at 5 percent; any budget watchdog will tell you that increasing spending at a rate higher than the state’s projected inflation rate—currently 2.7 percent—is a bad idea, and only delays the eventual reckoning. State Comptroller Thomas Napoli has declared himself wary of Mr. Spitzer’s increases, and the Manhattan Institute’s E. J. McMahon noted, “They’re not leaving much margin for error if the economy gets worse than they projected.” He added that the boost in spending may very well require large tax increases in the near future.

One has to ask if Mr. Spitzer, aware of the drubbing he’s taken in his battles with the State Legislature, is worried he might reignite his touchy relationship with state senators and members of the Assembly if he proposes the cuts the state badly needs. This is, after all, an election year: Any effort by the governor to curtail spending and trim programs would be met with howls of protest and an avalanche of attacks from those elected officials. Yet despite the scars he bears from his tumultuous first year in office, this is a battle well worth fighting.

Governor Spitzer might want to look across the Hudson and learn from Jon Corzine. The New Jersey governor showed courage and determination last week as he proposed budget cuts of $500 million and a reduction of the state’s workforce by 3,000, framed in a bold and candid speech in which he declared, “Frankly, New Jersey has a government its people cannot afford.” As he put it, his plan was “cold-turkey therapy for our troubled spending addiction.” This former co-chairman of Goldman, Sachs understands that the quickest way to reform a corrupt spending culture, whether in Trenton or Albany, is very simply to take away the money. While valuable programs will inevitably take cuts they can ill afford, the long-term benefit of resetting the budget calculus outpaces short-term pain. And to put it even more simply, unless such stringent measures are taken immediately, the state’s fiscal picture will turn darker very fast and very unpleasantly.

And yes, Governor Corzine, who faces reelection next year, is getting clobbered for his straight talk on spending. But isn’t that the mark of a true leader versus a conventional politician: one who’s willing to see his own political viability damaged for the sake of the well-being of his constituents?