“Have we seen this movie before?”

In Columns by Hal Peterson0 Comments

On January 14th, the New York Times reported that “President Obama on Friday announced an aggressive campaign to shrink the size of the federal government, a proposal less notable for its goal – the fight against bloat that has been embraced by every modern-day president – than for the political challenge it poses to a hostile Congress.”

This paragraph is an easy rewrite with state of New York in mind. Change “President Obama” to “Governor Andrew Cuomo”, “federal” to “state” government, “president” to “governor” and “congress” to “state legislature” and your off and running. Needless to say that both governments’ are dealing with “bloat” and in anticipation of where I’m headed, trying to shrink whatever needs shrinking.

Obama’s plan, with an upcoming election in mind, is to gain congressional approval to fold the Small Business Administration and five other trade and business agencies into a single agency that would replace the Commerce Department. He estimates $3 billion in savings (over 10 years) in a $3.7 trillion budget.

Cuomo’s approach, dating back to last January, addresses spending and efficiency concerns through the establishment a new commission that will (1) provide independent guidance to address budgetary challenges, and (2) result in the reduction of at least 20 percent of the number of existing agencies and authorities.

In retrospect, the president’s plan is really nothing more than a miniaturized version of what he wanted to accomplish when on February 18, 2010 when using an Executive Order, he created a bi-partisan National Commission for Fiscal Responsibility and Reform (co-chaired by Erskine Bowles President Clinton’s former chief of staff and former Senator Alan Simpson to study how to trim $4 trillion from the deficit. Their findings were released 11 months later only to be dead-ended because of the lack of a “supermajority” of votes. Obama quickly realized his base for support had evaporated and abandoned ship faster than the Capitan of the luxury cruise liner Costa Concordia.

On December 15, 2011, the new commission referred to above, which is called the SAGE – Spending and Government Efficiency Commission, issued its first major report that I have reviewed in detail. Unfortunately, it lacks the specificity needed to truly transform New York State into any semblance of a mean and lean operating machine. Of particular concern, this report, makes no attempt to put to use the trove of information readily available from past audit reviews which is basic to any valued assessment. The New York State Public Employees Federation, representing some 55,000 professional employees has joined the criticism stating the report “lacks detail.”

In dealing with the pros and cons cited, there is common thread. When things get down to the nitty-gritty, reality trumps intent. The problems cited on both levels of government have been vegetating for years. Federal Government debt is about to be increased by another $1.2 trillion. Cuomo’s current budget, submitted last week to the Legislature, projects a need for $132 billion to fund operations, approximately the amount needed in the prior fiscal period.

Erskine Bowles, said it best. “It’s clear. The arithmetic is easy. The fiscal path we are on is not sustainable.” Go figure! We have seen this movie before.

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