Tuesday, January 07, 2014

Bill vs. Andrew: Dems’ dilemma

Cuomo wants to cut taxes. De Blasio wants to raise them.
The governor's right.

Tuesday, January 7, 2014, 4:30 AM

Seth Wenig/AP

Competing philosophies.

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It was a Tale of Two Democrats on Monday, as Mayor de Blasio beat the drum for raising taxes and Gov. Cuomo recommitted to cutting them.

Cuomo has the far, far better case.

The mayor who just took office and the governor running for reelection this fall are old friends and colleagues who profess to be simpatico politically.

But the fiscal messages in their dueling press conferences — coming from the two top members of the same party in the same state — could hardly have contrasted more starkly.

At his Harlem event, de Blasio stood shoulder-to-shoulder with labor leaders — many of whom have a direct financial stake in bigger government — to demand that the highest-taxing, highest-spending big city in America should tax and spend even more.

At the Capitol in Albany, meanwhile, Cuomo surrounded himself with business executives to make a full-throated argument that government must get leaner and taxes must come down — as a crucial step to rejuvenating the state’s economy.

“Once we get the high taxes out of the way,” he declared, “the assets of New York can shine.”

Clearly, he and de Blasio have lined up on opposite sides of the Democratic Party’s great divide.

De Blasio’s call for a surcharge on city residents making more than $500,000 — to finance the worthy goal of universal pre-kindergarten — puts him unabashedly in his party’s self-described progressive wing, which makes a passion for taxing the rich the ultimate litmus test.

This pitch won him an impressive victory in the mayor’s race. But it also puts him in much the same liberal bubble as some of the speakers at his inauguration — who ludicrously painted the city, which devotes fully a fifth of its generous $69 billion budget to social services , as a heartless bastion of Darwinian capitalism.

It might have been tempting for Cuomo to jump onto this ideological bandwagon and become an MSNBC darling.

Instead, his call for a $2.2 billion package of business and property tax relief signals strongly that he’s holding his ground as reality-based Democrat. He’s progressive on social issues (think same-sex marriage and gun control), but also has a healthy respect for the value of a tax dollar.

He has held the overall growth of state spending to a tight-fisted 2% for three straight years — a dramatic break from recent New York history. He also recognizes — as he said in his 2011 inauguration speech — “this state has no future if it is going to be the tax capital of the nation.”

Cuomo says he wholeheartedly supports de Blasio’s goal of delivering universal pre-k. He just differs on how to raise the necessary cash.

And as progressive priorities go, where the money comes from should be a distant second. The critically important thing — for both the kids and the progressive cause — is delivering a program that reaches kids with high-quality early education, which will be a hugely difficult task in a city as big and complicated as New York.

De Blasio should be sweating out how to get the right teachers in the right rooms with the right kids — a task that might require concessions from his friends in the United Federation of Teachers. The disastrous rollout of Obamacare should be a wakeup call for progressives about the critical value of competence in government.

Instead, the new mayor seems to be sinking his political capital into the fight for a tax hike that, by any reasonable analysis, isn’t necessary to make pre-k, and the after-school programs de Blasio wants along with it, work.

For one thing, the $530 million it would raise annually amounts to less than 1% of the budget — and could readily be found elsewhere. To cite one example, the Citizens Budget Commission estimates that asking city employees to chip in a fair share of their health-insurance premiums — as virtually all other workers already do — would save $2 billion, enough to finance pre-k four times over.

De Blasio, with Cuomo’s help, could also expect help in the form of extra aid from Albany.

On Monday, however, he insisted that a dedicated tax is crucial to providing a reliable, long-term source of funding.

Even though revenue from high-income surcharges is almost certain to fluctuate wildly, along with the ups and downs of the stock market.

Even though his own proposal calls for the surcharge to expire after only five years.

De Blasio and his fellow progressives need to ask themselves what they really want: a symbolic victory on soaking the rich, or doing the right thing by city kids?



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