“The ways in which responsibility may have been shirked, or ignored, in the past, to live for another day — that day has come, and we're going to have to make those tough choices,” news sources say that Governor Paterson remarked in response to the Ravitch Commission plan to save the MTA. But in reality, the Ravitch Commission plan is a replica of the previous two — borrow massively for just a few years of ongoing needs, and live another day, maybe. Everyone in the region is paying a ¼ percent sales tax to the MTA, and will be forever, but the money isn’t used to either operate or rebuild the system, it goes to past debts. The same may be said of the MTA corporate income tax. Other bonds were floated against future fare revenues, something the Ravitch plan criticizes obliquely. It instead plans to create an off-balance sheet entity to borrow $35 billion for the 2010 to 2014 capital plan, and operating costs in 2009. But this isn’t a new idea — there is already such an entity collecting the 1/8 percent additional sales tax to pay bonds for the 2005 to 2009 capital plan. In 2010 and forever after we’ll by paying that extra sales tax, but receive nothing for it. The same will be true of the permanent 1/3 percent wage tax the Ravitch plan proposes to fund the 2010 to 2014 plan. In 2015 we’ll still be paying it, but getting nothing. The “tough choice” is to delay the day of reckoning five years by making things even worse for the future. Again.

As I’ve written in a variety of posts on a variety of subjects, the generations now in charge, in the public sector, private sector and their own lives, have endeavored to “live richly” by securitizing any future anyone might have in this country, and cashing it in. A future they thought would be far off, and that they would not be around to see. But with the recession, credit crisis and collapse in asset values, the future is coming sooner than they expected, and one can almost sense the panic. Today I read a fantastic quote, in a blog post about New Jersey’s public employee pension system, that completely captures the moment. It could have been about NY's pensions, the MTA and the Ravitch Commission, the state and local government budget crises in New York and throughout the nation, Wall Street, private equity, hedge funds, many other businesses, many people's personal finances, etc. “There is a scene in Mel Brooks' The Producers where Gene Wilder realizes the jig is up and starts intoning 'no way out' while clutching his blankie since, being a reasonably learned accountant, he grasps the situation. Zero Mostel however, whose schemes got them into their mess, still thinks there are outs. That's how an unbiased pension actuary would feel looking at the state of the New Jersey pension plan. It's effectively dead but we still have the Zeroes who got us into this mess running around selling more hopes and dreams.”

I’ve been reading about the negotiations between the current State Senate majority leader, Dean Skelos, and the “Gang of Three,” Sen. Carl Kruger, Sen. Ruben Diaz Sr., and Senator-elect Pedro Espada Jr., over control of the State Senate. I have a question for those who consider themselves Republicans,Democrats, “conservatives,” “proggressives,” the Manhattan Institute, the Fiscal Policy Institute, the New York Times, the New York Post, etc. Anyone want to take ownership of these guys, and say that the four of them are working for their values?

The future of New York, City and State, has been severely diminished by the self dealing of the past, including the recent past. But we can at least be thankful that Bloomberg, Paterson, Silver, Skelos and Quinn are not proposing a stunt like this.  New Jersey's pension funds have only half the money needed to pay benefits, even given an assumed rate of return they'll never get, and unlike in New York it was taxpayers unwilling to pay taxes rather than public employees seeking pension sweeteners that get the lion's share of the blame.  So what is being proposed in the Garden State?  Keeping taxes down by taking (another) "holiday" from required pension contributions! 

There is no question that Upstate metropolitan areas have their problems. Once among the most dynamic and forward-thinking areas of the United States, the region has been living off the former prosperity generated by older companies, a prosperity that is passing away with those companies due to economic change. Employment has been kept steady by the growth of government and government-dependent sectors such as health care, and low-paid retail and services. The average private sector worker in the Upstate metro counties (Albany, Broome, Dutchess, Erie, Monroe, Niagara, Oneida, Onondaga, Orange, Rensselaer, Saratoga, and Schenectady) earned 11.4% less than the average for the United States in 2007. In the post-air conditioning “Sunbelt” era, an era ironically abated by Syracuse-based air conditioner maker Carrier (who even needs air conditioning up there?), the beautiful lakes and trees and abundance water of our northern interior states have been thought by millions of Americans to be less desirable than warmer, southern states that get more sunshine and less snow. So to be fair, I’ve compared the local government employment and payroll of the Upstate Metro counties with several other older, urbanized, cold-weather manufacturing-based counties across the country — Allegheny (Pittsburgh), Cuyahoga (Cleveland), Franklin (Columbus OH), Wayne (Detroit), Milwaukee and Hennepin (Minneapolis). In 2007, all had far fewer local government employees per 100,000 residents than the Upstate NY metro counties, with the exception of…

In my previous post, I used employment and payroll data from the 2007 Census of Governments, described in my first post on the subject, to compare New York City with other older central cities. In this post I compare full time equivalent local government employment per 100,000 residents and March 2007 pay per employee for New York’s Downstate Suburban counties — Nassau, Suffolk, Westchester, Rockland, Putnam — with other suburban counties with large job bases in the Northeast Corridor. To Fairfield County in Connecticut, also presented in the initial table, I add Middlesex County outside Boston, Montgomery County outside Philadelphia, Baltimore County outside the City of Baltimore, and Montgomery County MD and Fairfax County VA outside Washington DC. With the exception of one of these counties, local government is clearly more expensive in the Downstate Suburbs than in other northeastern suburban counties, due to higher employment levels, particularly for schools, roads and police, higher pay, or both. Even in that county, moreover, the total cost of government may be lower due to lower debts, less rich pensions, and a less expensive Medicaid program that is not shifted to the local level. But looking just at those on the local government payroll, the suburban county where there are even more local government workers earning more money than in the New York Suburbs is…

Ever since I started tabulating and analyzing data from the Governments division of the U.S. Census Bureau in the early 1990s, I’ve found that the results are something that no one of any political persuasion has wanted to see. My former supervisors at City planning once presented the data, along with a bunch of other information, to former NYC economic development czar John Dyson. He was so upset that most of NYC’s extra local government taxes as a share of personal income, over and above the U.S. average, went to categories of spending that no business person would consider “public services” that he started ranting “New York stinks” at a conference that very evening. When presented with the same data his boss, former Mayor Giuliani, was not happy to see that NYC’s staffing and spending levels were so high for police and low for education, given that he wanted to make them higher and lower respectively. A housing advocate and city planner grew upset with me when I pointed out New York City’s comparatively high spending on housing and low spending on services such as education and parks, accusing me of immorally “trading off one need against another,” as if that wasn’t what the data showed had already happened. And when I presented the data to the City Planning Commission as part of the preparation of the charter-mandated Planning and Zoning Report, former commissioner Ron Shiffman felt the comparison with the U.S. average made NYC look unfairly bad. “At least compare us with other cities for God’s sake,” I recall him saying. Very well Professor Shiffman, this post and the attached tables contain the comparison you asked for.

In the spreadsheet attached to this post, I provided tables of comparative data on local government employment and pay for different parts of New York State in March 2007, along with the data and capacity to quickly make similar comparisons with major counties around the country. The sources and tabulation methods are explained in that post. Attached to this post is a table that takes similar information I compiled five years ago, when the 2002 Census of Governments was released, and compares it with 2007 for the United States; New York City; the downstate suburban counties (Nassau, Suffolk, Westchester, Rockland, Putnam); the mostly highly urbanized Upstate NY counties (Albany, Broome, Dutchess, Erie, Monroe, Niagara, Oneida, Onondaga, Orange, Rensselaer, Saratoga, and Schenectady); the other more rural Upstate New York counties; and the total for New Jersey. The data show that full time equivalent local government employment per 100,000 people rose 1.4% in the United States from 2002 to 2007. For New York City it fell 4.3%, for the Downstate Suburbs it rose 8.2%, for the Upstate Metro counties it rose 1.1%, for the rest of New York State it rose 2.9%, and for New Jersey it rose 5.4%. Needless to say, I am not surprised.

Maybe it’s time for me to take off the kid gloves again. Maybe it’s time for me to start going after the many mistakes that Barack Obama makes; mistakes which some in mainstream media (and also in alternative media) tend to be lenient about. The campaign is over now, so those of us who didn’t want to negatively impact on his chances for victory can return from that hiatus from objectivity. He won.   

I am quite perplexed by the many problems that Barack Obama often seems to create for himself: there is a pattern here. And because the media tends to be relatively lenient it doesn’t mean that he will forever get away from full scrutiny. Many times I have wondered if Obama really understands what he is getting into. Has this always been about raw personal political ambition? Is this about some death-wish for martyrdom? Or is this truly about “change”? 

One of the arguments the city’s dead trees made to overturn term limits, and perhaps eliminate real elections, is that Mayor Bloomberg has financial acumen beyond nearly all other New Yorkers, and is indispensable at this time of financial crisis. Recently I have gained firsthand knowledge of the financial brilliance with which the City of New York is being run. It seems that the City has made an investment with a 60% rate of return over 7 ½ months. Over a full year that is nearly a 100% rate of return, or a doubling of the City’s money. Unfortunately, I have found this out because I am on the other side of the trade, and forced to pay that massive rate of return. If I do not, “further legal action may ensue.”