[Politics] more on ANY OPPOSING VIEWPOINTS djf Krugman

[David Farber <dave () farber net>]

Begin forwarded message:

From: "Gordon C. Thomasson, Ph.D." <gthomas1 () stny rr com>
Date: November 28, 2004 10:44:50 PM EST
To: dave () farber net
Subject: Re: [IP] more on ANY OPPOSING VIEWPOINTS djf Krugman

Dave,

Subject: Re: [IP] more on ANY OPPOSING VIEWPOINTS djf Krugman
  > I see both the state of NY and the state of CA and all of the
  > largest urban areas therein as broke.

  Governments tend to go broke when tax receipts decline faster than 
spending slows.  This situation is likely to reverse as economic growth 
returns -- due to absorbtion of new technologies.  

  Mark Stahlman
  New York City

 Living in NY and being from CA ...

 California would not have become "broke" (or elected/had reason--NOT 
the
 same thing as rationality--to elect the puppet-for-big-business 
Arnold) if it
 had repudiated ALL unpaid energy bills after the ENRON (and other
 providers') scam/theft became known and indicted the officers of any 
provider
 who threatened to cut off power delivery in response, and immediately 
sued
 for recovery of all monies already paid, plus triple RICO damages.  LA
 County's municipal power, like a few areas in NY, free of the 
conspiratorial
 grid, is proof that the price-of-power-fixing was all a fraud.  
Short-term economic
 growth or decline and/or the absorption of new technologies is 
irrelevant.

 (Will Ken Lay ever see a day of jail, given GWB's "mandate" and all KL
 knows about where the bodies are buried?  Will we ever see what 
industry
 and Dick Cheney created in the White House and how?  Or, more to the
 point, will information on who all in the Bush administration 
feloniously
 "outed" ambassador Wilson's CIA wife (and targeted all those with whom
 she worked overseas, both naive and innocently or as actual company
 assets / agents) come out before the November 2004 election? ...
 --anachronism intended!)

 I not only live in New York but in Broome County, original but now 
almost
 all outsourced home of IBM (even if to other parts of NY).  Since 
1990, our
 "Peace Dividend" has been a disproportionally high loss in 
manufacturing
 and other non-service jobs.  (But don't panic, "assembling burgers"  
is now,
 we are told by some state Republicans, a manufacturing job.)
  
 New York (and national) Republicans (a publican was a tax collector, 
or more
 precisely a tax-farmer, so what is a re-publican?) love to rant (and 
get elected)
 "when tax receipts decline faster than spending does", but they 
all--obscenely
 (and perhaps predictably--even those styled as "economists"), never 
point out
 to the overburdened public-they-pander-to the difference between fixed 
costs
 and other kinds of government spending.  Governments cannot stop 
plowing
 streets, lighting dangerous intersections, maintaining health and 
emergency
 services or providing a host of other public services without risking 
both court
 liabilities ("the victim wouldn't have died if the street had been 
plowed as it
 had been for the previous 70+ years, your honor"), and enormous costs
 shifted to individuals, local and county governments when state 
government
 no longer provides essential services.  Of course cutbacks always come 
first
 in affluent neighborhoods and around powerful corporations, etc., never
 on the poor ... NOT!  [Not just a NY thing: after Prop 13 passed in
 California in the early 1970s, I saw funding cut for swimming 
pools--I'm
 from South Central LA--but not for shuffleboard courts, a "demographic"
 thing.]

 The next time someone complains about spending, ask what percentage of
 government spending is fixed cost.  Sure, they'll complain that wages 
and
 benefits to government employees are too high, but unless they 
outsource
 essential jobs and services to India (To plow our streets? I seem to 
recall a
 mid-western state outsourcing its unemployment services, of all the 
stupid
 profit-, bribe-, and kickback-making decisions, which further destroys 
our
 local tax revenues, job markets, and economies.), who will perform the
 essential services that are so much of the fixed cost of governments.  
As it
 is, nationwide many urban government employees cannot afford to live in
 the community where they work.  In NY, our whore-to-the-rich (oops,
 excuse me, R-governor) has cut state taxes by cutting state payments 
for
 many services, transferring the cost for those to county and municipal
 governments, but not cutting taxes anywhere near as much as funding
 for services--then all we have to figure out is what he does with the 
balance. 

 ((Full Disclosure: as a Cornell Ph.D., since 1993 at our local 
community
 college, nominally part of the SUNY system, though NOT in salary or
 benefits--let's forget national averages for people with comparable 
training
 and experience--I have been paid more than $10,000/year LESS than the
 average New York high school teacher, with a decline in our real wages
 every year.  Yes, downstate teachers have higher rents, but upstate we
 have higher energy and transportation costs.  As public employees, NY's
 fascist "Taylor Law" prevents striking or ANY OTHER effective job 
action
 (picketing with no threat behind it is a near-pointless exercise in 
"free
 speech") to try and get anything remotely resembling fair treatment. 
 Pennsylvania's toll booth operators have more real rights than ALL of
 NY's public employees--whether toll booth operators, professors, M.D.s,
 and after 9/11 the politically exploited/photo-opt'ed to/in death EMTs,
 police, and firemen, combined.  The state and county never meet their
 obligations to each fund 1/3 of CC expenses either, the students--and
 underpaid faculty & staff--have to make up the balance.))  

 While politicians blame taxes for industrial declines, our gridlocked 
state
 government (assembly is urban controlled/democratic majority, and
 senate is rural controlled/republican majority, and with either R- or
 D-governors) has failed to pass a state budget on time or anywhere
 near the legally mandated and fiscally necessary deadlines for twenty
 years.  How does a school district, for example, plan its budget, 
hiring, etc.
 for a Fall semester when the state can't/won't pass a budget until 
August
 or September?  What new business would want the same unpredictability
 in taxes, etc. that results when they can go to a state where politics 
and
 economics are more rational?  It's not the taxes but the anarchy in 
Albany
 that is most discouraging to serious new businesses.  (Big old ones 
already
 own Albany, and receive more tax breaks than individuals, of course: 
 industrial development zones, energy cost subsidies and tax breaks, 
etc.)

 To go back to where this started, New York state tends "to go broke" in
 large part, not just because of declining tax revenues over and against
 government spending that result from politicians' irrationality, but 
because
 of increased debt-load that results from political 
inefficiency/corruption. 
 Check out how every illegally late-passed state budget lowers NY 
state's
 already LOW bond-rating (and "investor confidence") and figure out what
 THAT costs--in terms of interest as a slice of expenditures out of a
 revenue pie, whether fixed, rising or declining--as year-after-year our
 unpassed state budget delays translate DIRECTLY into higher interest 
rates
 to service our debt load on bond markets.  (I won't allude to the links
 between state Republicans and bond-brokering and issuing profit-making
 institutions.  I wouldn't want to offend the bankers who contribute to 
the
 party.)

 Enough!

 Gordon C. Thomasson, Ph.D.
 World History Faculty
 Broome Community College (SUNY)

 

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