Sheldon Silver OutFoxes Cuomo And Sticks Cuomo With The Future Blame For Revenue Shortfalls And Default/Bankruptcy

  
New York's budget is a fool's delight.

   The Cuomo Budget process and its Committees and teams were all a big farce, because Cuomo operatives prepared the outcomes and the committees were left with a rubber stamp. "Add Common Cause to the list of organizations unhappy with the about-to-be-completed 2011-12 budget. Rather than the cuts, they are upset about the level of secrecy involved in crafting the spending plan, which appears to be a replay of the time-tested “three men in a (closed door) room” method.
      "Localities were quick to knock the first report ... from Mandate Relief Redesign Team, saying it falls short of the reforms needed. ...Gov. Andrew Cuomo ... is seeking to cap the growth in property taxes to 2 percent a year. Governments and schools said they would be hard-pressed to abide by the cap without having some state requirements removed."   "What irked some on the 23-member panel was that while they had discussions with Cuomo's staff about the final version of the report, they only saw it minutes before it was released publicly."  Suffolk County's Steve Levy said Cuomo's team report was 78 pages of nothing.

        This was a temporary victory for Cuomo, but disaster is ahead, because the revenue side of the budget is a farce.   "The new governor holds the commanding heights,” said Robert B. Ward, deputy director of the Rockefeller Institute, a research center. “The role for the Legislature often is to wait out a governor — and certainly the speaker has proven he’s a master of that."    Was Assembly Speaker Sheldon a sly fox who knew Cuomo now had responsibility for the budget and the phony revenue predictions?   "Mr. Silver [had]explained, it would be the widely reviled Legislature — not the popular governor — that would be blamed [if a budget wasn't passed]."   Didn't Silver responsibly want more taxes?

     Local schools are announcing layoffs in response to budget cuts.  A sample of schools follow.
Beekmantown School layoffs
Saranac Central School District has no reserves and layoffs needed
Ausable Central School district has low reserves and layoffs will be needed
Cohoes City school district proposes layoffs
       And these unemployed workers won't pay State income taxes (reduces Income Tax revenues) and also drains State coffers (unbudgeted expenditures for benefits), because NY State can't borrow its share of unemployment expenses from the federal government as it did in 2010. Worse still many local districts have to layoff more workers because they don't save the entire cost of wages paid, because many must still pay the full cost of unemployment benefits, because they use the benefit reimbursement plan instead of making regular unemployment contributions (in other words, they paid nothing until a worker is laid off and then they pay the full benefits)
"The Benefit Reimbursement program lets employers reimburse the Unemployment Insurance Fund for benefits paid to their former employees in place of paying on a tax rated basis.  The following groups that are tax exempt under Section 501 (c) (3) of the Internal Revenue Code qualify for this option:    Nonprofit organizations organized and run only for:  religious, charitable, scientific,  literary or educational purposes and Government entities."
This same unemployment benefit (unbudgeted expenditure) payment will affect any New York State layoffs Cuomo plans, because the promised savings will have to be reduced by the full cost of all unemployment benefits paid.

   And NY Counties will follow with more layoffs because of Cuomo's pass down of a 9.4% increase in Medicaid County expense which is the largest expenditure for Counties and the failure of his Mandate Relief Team.   Things get worse because a Pension Tsunami is going to hit California and New York.  New York State has an absurd assumption that it earns 7.5% on its pension funds when the real rate was 1.1% for the past five years.     This will effect New York's credit rating and lending rates.

Meanwhile, as inflation threatens and gas and fuel prices rise 100%,  will Cuomo get more money by borrowing when New York is all ready the most indebted per person with $97,000 for a family of four?

The US Treasury can run out of cash, as can a State.

The Clever Fox Award goes to Sheldon Silver and the booby prize to?

New York's Budget Is Now Cuomo's Budget And Default His Responsibility

     Assembly Speaker Sheldon Silver and Senate Majority Leader Dean Skelos laugh and smile as they pass Cuomo's budget.   Now, Andrew Cuomo owns the New York State budget.  He can't blame the legislators for passing his budget.  So, who will Cuomo blame when the revenue fails to come in and the massive borrowing begins?

     Now, there is Joy in Albany as Andrew Cuomo passes his budget and Cuomo comes to bat.  But, all the flaws reported in this blog in Cuomo's Executive budget are still there.  Most importantly, New York will run out of cash because of
1.  fantasy revenue predictions. 
2.  $3.6 billion in required spending is missing from the budget . 
3.  Cuomo's hidden taxes on business will discourage new business in New York. 
4.  Cuomo has ignored the pending suit to increase judges pay and its additonal cost to the State.  
5.  Counties and Cities will have to raise taxes to pay their 9.4% increase in Medicaid costs which is the largest expense in their budgets?

But, Hope as Cuomo comes to bat:

Then from 5 million throats and more there rose a lusty yell;

It rumbled through the Hudson valley, it rattled in the Albany dell;

It knocked upon the Adirondack mountains and recoiled throughout the State,

For Cuomo, mighty Cuomo, was advancing with his budget's plate.

There was ease in Cuomo's manner as he pranced into his place;

There was pride in Cuomo's bearing and a smile on Cuomo's face.

And when, responding to the cheers, he lightly doffed his hat,

No stranger in the crowd could doubt 'twas Cuomo at the bat.

Ten million eyes were on him as he rubbed his hands in Albany's dirt;

Five million tongues applauded when he wiped them on his shirt.

Then while the writhing tort lawyer ground the ball into his hip,

Defiance gleamed in Cuomo's eye, a sneer curled Cuomo's lip.

And now the cap on medical malpractice sphere came hurtling through the air,

And Cuomo stood a-watching it in haughty grandeur there.

Close by the sturdy batsman the malpractice cap unheeded sped-

"That ain't my style," said Cuomo. "Strike one," the doctors said.

From the crowds, black with people, there went up a muffled roar,

Like the beating of the storm-waves upon Long Island's shore.

"Kill them! Kill the lawyers!" shouted someone in the band;

And it's likely they'd a-killed them had not Cuomo raised his hand.

With a smile of Christian charity great Cuomo's visage shone;

He stilled the rising tumult; he bade the budget farce go on;

He signaled to the mandate relief pitcher, and the mandate relief spheroid flew;

But Cuomo still ignored it, and  Steve Levy said, "Strike two."

"Fraud!" cried the maddened millions, and the echos answered fraud;

But one scornful look from Cuomo and the People were awed.

They saw his face grow stern and cold, they saw his muscles strain,

And they hoped that Cuomo wouldn't let a ball go by again.

The sneer is gone from Cuomo's lip, his teeth are clenched in hate;

He pounds with cruel violence his silver spoon upon his plate.

And now the Chinese Debt Master holds the ball, and now he lets it go,

And now the air is shattered by the force of Cuomo's blow.

Oh, somewhere in our favored land the sun is shining bright;

The band is playing somewhere, and somewhere hearts are light,

And somewhere men are laughing, and somewhere children shout;

But there is default in Albany — mighty Cuomo has struck out.

Would you buy NY Bonds knowing?

New York State Debt per person including local debt is $24,195.  For a family of four that is about $97,000. That is the highest in the USA.  And surprise, Cuomo's budget revenue predictions were a farce.

Andrew Cuomo Faces Steep Interest Rates Or Default With Highest State/Local Debt Per Person Or About $97,000 Per Family Of Four

What is the Credit Rating for New York's indebtedness?

    Let's look at New York's outstanding debt, which will affect New York's ability to borrow more money when Andrew Cuomo's Budget fails to produce desired revenue.  (See blog post below or link)   New York leads California in official debt per person by 29% and greater than the average for all States by 73%.    The grim numbers are below.

        From governmentspending.com
State   Gross Local and State Debt    Population  Debt per person
                      in billions                           millions        dollars
California       371.2                                 32.8          $11,317
New York      281.9                                 19.4          $14,531
Florida            128.4                                19.3          $ 6,653      
Michigan          72.2                                10.0          $ 7,220
Texas               210.6                                25.4          $ 8,291
All States    2,617.4                            311.4          $ 8,405

     But, New York State's Pension Plans use a fraudulent Madoff like safe return of 7.5% to calculate Pension reserves.  (The actual rate of return for the past 5 years was 1.1%).   If we correct the pension liabilities optimistically with a 3.1% return, instead of the 7.5% fraudulent rate we find another $9,664 additional debt per person, raising the New York Debt per person including local debt to $24,195.  For a family of four that is about $97,000.

    The USA and its States will face borrowing problems, as reality sinks in:
US finances near worst in World
Moody's cracks the whip on Britain
The exact cost of bad decisions by government bodies, whether they be the U.S. Congress, state legislatures or local city councils, is often hard to quantify.
Now, the simple questions, if you wanted to invest in State Bonds?
1. Which State is most heavily in debt per person?  NY
2. Which State balanced their budgets? not NY
3. Which made outlandish predictions of revenue and now wants to borrow to finance their spending excesses? NY
3. Would you demand a large premium in interest rates to lead to New York over other States?  Yes

How many ads will be needed to be purchased in the future to convince you Cuomo's promised good intentions excuse his failures? 

Andrew Cuomo's Hope For Increased Tax Revenues Was False And He'll Run Out Of Cash

     Student's letter to Mommy and Daddy: I was very careful with my budgeted money for the year and only bought things which my friends approved and now I'm broke.  Please send more.

       Cuomo's Executive Budget's great hope is that fantasy tax revenue predictions will come true.  We look at Cuomo's budget as analyzed by Comptroller Dinapoli  below. 

The Fantasy numbers are in blue and [Reality is in red]
Report on the State Fiscal Year 2011-12 Executive Budget by Comptroller DiNapoli is the text that follows:
    The Executive Budget estimates that total All Funds receipts will decline in SFY 2011-12 by $1.7 billion, or 1.3 percent, over SFY 2010-11 to $132.9 billion.  The decline can be attributed to the loss of federal stimulus funds receipts, which are expected to fall $5.8 billion, or 11.6 percent.  This loss will be partially offset by growth in All Funds tax receipts, which are estimated to increase $4 billion, or 6.6 percent, to $64.8 billion.  This increase is attributable to the economic recovery, the revenue actions passed last year and those proposed with the SFY 2011-12 Budget.  Finally, All Funds miscellaneous receipts basically remain unchanged, growing by $80 million, or 0.3 percent.

Personal Income Tax
For SFY 2011-12, All Funds PIT  receipts are forecast to increase by $2.6 billion, or 7.4 percent, over the prior year.  The increase is attributable to the improving economy, higher refunds in SFY 2010-11, and the voluntary compliance initiative in the Executive Budget.  Base tax receipts, which net out the $500 million in additional refunds in SFY 2010-11 and the elimination of the high income  tax provisions in the fourth quarter of SFY 2011-12, are projected to grow by 11.4 percent.  [More unemployed people mean less personal income taxes paid.  Cuomo needs to borrow way in excess of another $3.6 billion dollars  just to replace delusional tax revenue increases in the budget.]

User Taxes and Fees
For SFY 2011-12, All Funds consumption tax receipts are forecast to increase by $627 million, or 4.4 percent, over the prior year.  The increase is mainly due to growth in the sales tax as well as cigarette and tobacco taxes.  The sales tax is expected to increase by $437 million, or 3.8 percent, as the economy continues to improve, offset by the partial return of the clothing exemption.  Cigarette taxes are forecast to increase by $165 million, or 10.2 percent, as the Executive expects to collect cigarette taxes sold on Indian reservations to non-Native Americans ($130 million). [Unemployed and under-employed have less money to spend and sales tax revenues may not rise.   Black-Market Cigarettes - with higher cigarette taxes mean smuggling expected to increase and tax revenues actually go down.  And Indians may win in their law suit for sovereign status.]
 
Business Taxes
For SFY 2011-12, All Funds business tax receipts are forecast to increase by $705 million, or 9.2 percent.  The increase is attributable to the improving economy and an expected increase in corporate profits of 6.2 percent.  All of the business taxes are forecast to increase in SFY 2011-12.  [Larger unemployment reduces workers and earnings from businesses - see  Personal Income Taxes above.]

Other Taxes
All Funds other tax receipts  in SFY 2010-11, including the payroll tax, are forecast to increase $432 million, or 16.6 percent, over the prior year.  This increase is attributable to growth in receipts from the estate tax ($216 million, or 25 percent), the payroll tax ($144.3 million, or 11.8 percent) and the real estate transfer tax ($73 million, or 14.8 percent).  [Employment declines noted above will reduce payroll tax. Property sales prices are falling and this reduces real estate transfer tax.   Estate tax revenues will decrease because investment portfolios values are decreasing and the values of real estate transferred by estates will also decline.] 

   When will Andrew Cuomo wake up and see his predicted budget revenues are daydreams?

       P.S. Alert on a developing problem: Medicaid disaster looms as Obamacare will increase number of New York Medicaid recipients by 1,750,000 according to Comptroller DiNapoli in his above report.

Four States, Maine, New Jersey, Tennessee and Ohio have obtained Medicaid waivers.
Representative Anthony Weiner who wants to run for Mayor saw the light and maybe asking for a Obamacare waiver.

When will Andrew Cuomo wake up and see that same light on Obamacare?

Cuomo's Support Ads Will Backfire When Public Holds Him Responsible His Budget's Gigantic Deficit

      Andrew Cuomo has promised Hope and Change with his budget proposal promising not to raise taxes.   Meanwhile the Cost of Living hits a record and "[other] states will be cutting back services drastically this year at the very same time they are raising taxes in order to close enormous budget deficits and avoid a muni-bond defaults crisis."   
     And so, Andrew Cuomo is going to own his budget as his supporters outspend the opposition.   Cuomo's media shill, Fred Dicker, expects that Cuomo will win with short extender budgets while blaming a government shutdown on Sheldon Silver and the Legislature.  But Cuomo's and Dicker's $10 billion dollar projected deficit is just a gross underestimation.   More and more NY layoffs will continue to increase NY unemployment from the 9% reported in blog post below and Cuomo's fantasy revenue predictions will not materialize.
  

Recent News Reports are a sample of New York layoffs:
GM has more layoffs in NY.
Saranac Central School District has no reserves and layoffs needed
Ausable Central School district has low reserves and layoffs will be needed
Cohoes City school district proposes layoffs
Does Cuomo really believe voters who now have the highest Cost of Living ever are in the mode to locally vote to increase taxes to prevent school layoffs or that School Districts are awash in cash?

      Cuomo's problem, which Fred Dicker may not comprehend, is that tax revenues are going down and the $1 billion in the red already reported by Comptroller DiNapoli from this year has to be borrowed and all new layoffs further decrease his income tax revenues.  Also, tax revenues decrease on businesses producing less with less workers.  And Cuomo's fantasy prediction of the budget growth in tax revenues of $2.6 Billion dollars will disappear and have to be funded by more borrowing.   New York will just run out of cash to pay bills and allocate funds.  
See California I.O.U. link  and  a California I.O.U. below

See Cuomo's Credit Card Taken Away.

Cuomo's Budget Becomes A Joke As At Least $3.6 Billion Dollars Is Deducted From Illusional Tax Revenues As New York Unemployment Climbs In Every New York Metro District

    Bureau of Labor Statistics show unemployment rising in every New York Metro district.    Cuomo's budget, the Senate's budget and the Assembly budget will all require extensive deficit borrowing, because they used fantasy employment numbers to estimate revenue from business activity and employees of such businesses.  These higher unemployment numbers will be increased even above these levels in 2011 by more layoffs at local government/school levels to accommodate increased local costs and, also, layoffs by NY State of State employees, yet to be announced.

     How much more will NY need to borrow to pay (deficit spending) for Unemployment Insurance Payments for these newly unemployed workers?  What businesses will be attracted with these added costs to fund New York's unemployment insurance costs?

      Large unplanned deficits were already expected by the NY Comptroller even before these latest unemployment numbers were released.   DiNapoli "warned that estimates about the amount of personal income tax that will flow into state coffers may not be reliable. He noted that the current fiscal year's budget was overly optimistic about job growth and ended up over $1 billion short in anticipated tax revenue".   Or over $1 billion dollars is carried over to Cuomo's new budget as an expense.

   Here's what Comproller DiNapoli says in his report on expected personal income tax revenues for Cuomo's budget:
"Personal Income Tax
 For SFY 2011-12, All Funds PIT  receipts are forecast to increase by $2.6 billion, or 7.4 percent, over the prior year.  The increase is attributable to the improving economy, higher refunds in SFY 2010-11, and the voluntary compliance initiative in the Executive Budget.  Base tax receipts, which net out the $500 million in additional refunds in SFY 2010-11 and the elimination of the high income  tax provisions in the fourth quarter of SFY 2011-12, are projected to grow by 11.4 percent.for these proposed budgets."

    The FACTS:
1. With higher unemployment, personal income tax receipts would not increase by $2.6 Billion as Cuomo promised, but rather decrease in Cuomo's new budget and $1 billion is carried over from prior year.
2. These unemployment revenue losses are accumulating now and will further increase the missing money, even before the budget year begins.
3. New York unemployment will further increase with school, local government and State employee layoffs resulting from budget cuts at all levels.
4.  Or Cuomo needs to borrow way in excess of another $3.6 billion dollars (2.6+1.0=3.6) just to replace delusional tax revenue increases in the budget.


  Default, bankruptcy are more likely.  But luckily for NY's Cuomo, California's Brown may be first to go down as Brown caves to Union demands.


   More Facts:
  Here are the latest metropolitan unemployment rates just released last week that show that in every NY metro area unemployment increased.  The data below is from the Press Release of Bureau of Labor Statistics

     Location                                                                %Dec2010    %Jan2011

New York as Whole Total................ 8.0      9.0  
  Albany-Schenectady-Troy.............. 7.1      8.2  
  Binghamton........................... 8.5      9.6  
  Buffalo-Niagara Falls................ 8.1      9.1  
  Elmira............................... 8.0      8.8  
  Glens Falls.......................... 8.5      9.9  
  Ithaca............................... 5.6      6.6  
  Kingston............................. 8.0      9.2  
  NY-Northern New Jersey-Long Island... 8.1      9.0  
     New York City..................... 8.6      9.4  
  Poughkeepsie-Newburgh-Middletown..... 7.6      8.6  
  Rochester............................ 7.8      8.7  
  Syracuse............................. 8.3      9.3  
  Utica-Rome........................... 8.1      9.3

The talk was cheap  

Andrew Cuomo's Latest Radio Ad Covers Up His Hidden Taxes And His Flubbed Corruption Cleanup

"The New York State Democratic Committee today [3/8/2011] released a new 60 second radio spot in support of Governor Andrew M. Cuomo's budget and ethics initiatives. "

 Here are the words of Hope and Change by Governor Andrew Cuomo in that radio spot:
  Hello – this is Governor Andrew Cuomo; you elected me to clean up Albany and to get the state’s economy running once again and that’s just what we are going to do.

We need a sweeping new ethics plan that will give us a government that we can be proud of; a government that works for the people and not for the special interest.

I proposed a new budget that closes a 10 billion dollar deficit with no new taxes; that’s right with no new taxes and it forces government to cut the waste and inefficiency.
Now, we need the state legislature to act and I need your help. Albany politicians need to hear your voice, democracy works when the people act.
Please join our team to build a new New York, go to www.cleanupalbanynow.com
Let’s get New York back to work. Thank you.

     Andrew Cuomo must have made this ad before he accepted his Medicaid Redesign Team's recommendations to
1.  "taxing radiology visits and physician-based surgeries...business groups across the state are hammering Cuomo on what they see as an about-face. His panel wants to expand the 9.63 percent surcharge on the other medical services to raise $100 million more a year. But that would add up to 2 percentage points more to health insurance premiums."
"The revenue-raising surcharge on medical services "is really a tax increase that will force employers and workers to pay more for health insurance," said Heather Briccetti, acting president The Business Council of New York State. ...  The Employer Alliance for Affordable Health Care called the measures "are nothing more than a hidden tax on New York's small business community."

2. For the Counties, which pay an equal share to NY State's expenditure, this year's Medicaid expenditure were $13.8 Billion and the cap on next year's expenditure will be $15.1 Billion(+9.4%)?
 Does increasing property taxes by $1.3 Billion not count as a tax increase?

 3. Is SEIU a special interest?   The New York Times reports, "New York’s influential health care workers’ union [SEIU 1199] appears on the verge of wringing significant victories out of Gov. Andrew M. Cuomo’s austerity budget, even as he nears potentially historic cuts in spending."

And what about Senator Kruger's corruption by taking over $1 million in bribes, where the NY Post's Fred Dicker reports: "Andy flubs big chance at cleaning up Capitol cesspool"

Tax increases, while promising none and flubbing cleaning up corruption?   When will Andrew Cuomo make a revised Radio Ad?

The Hand Writing Was On The Wall For Cuomo And New York Bondholders As All US Government Debt Is Dropped By World's Largest Bond Fund

    "The words of the Prophet were written, Sell now and not cry later " ~ CuomoTARP

   "Bill Gross, who runs the World’s Biggest Bond Fund at Pacific Investment Management Co., eliminated government-related debt from his flagship fund last month as the U.S. projected record budget deficits." 

    Note: Bill Gross dumps the bonds first, then makes the announcement, so as not to devalue his holdings before sale or let buyers know he was dumping the bonds.  

   See the words of the prophet in the reprint of the Thanksgiving Post on this blog predicating the devaluation of NY Bonds and the subsequent increase in interest rates requiring a large budget increase to cover the higher rates.    Also, link to Rating New York Bonds

At Thanksgiving Fest, NY Bondholders And Cuomo See The Hand Writing On The NY Capital Walls

The words, Mene, Mene, Tekel, u-Pharsin, written by a God of Justice Disrupt the Albany Victory Celebration (King Cuomo, Silver, Paterson and Sampson in their blue uniforms with their new committees behind them)
  *picture described in note #1 below

  CuomoTARP has obtained two translations for the handwriting "Mene, Mene, Tekel, u-Pharsin" on the walls of the NY Capital Buildings. It was the same Aramaic words the Babylonian King Belshazzar saw on the wall in Babylon around 539 B.C., *See historical note #2 below

        Translation #1: Mene, Mene, Tekel, u-Pharsin translates to Number, number, weigh, divide in two."   And the meaning is the same, for both King Andrew and King Belshazzar, "God has numbered your remaining days in power; your number is up; you've been weighed and found deficient; and your State will be divided up financially and given to its creditors."

 A Creditor: One of a tribe of savages dwelling beyond the Financial Straits and dreaded for their desolating incursions.
~ from Ambrose Bierce's Dictionary

Chinese creditors crack their whip on the Bernanke/Obama money printing scheme.  

Follow the economic reality trickle down below:
    China and Russia have decided to renounce the US dollar

     Fears of Domino Effect Pervade Europe: Loss of Confidence Extends From Ireland to Spain, Portugal; Bond Spreads Widen as Euro Tumbles


     Belgium's debts to record levels in situation made worse by broken political system

    Now, see the world economic reality trickle down into NY on this blog: 
    another $6.8 Billion missing from the Cuomo Budget Plan.  

    NY Comptroller, DiNapoli, now promises safe returns of 7.5%  (or Madoff has a bridge for Sale)


    The Final Prophecy: from the Ghost of NY Yet To Come: the Trophy of Total Fiscal Failure. 
  

Now, the translation #2 for NY Bond Holders:

  Mene:  Count your bond values now
  Mene:  Count your bond values after the credit rate rises, inflation increases and bond desirability decreases  *See notes 3 and 4 below
  Tekel: Same as shekel or watch your money
  U-Pharsin;  Your bond values will be cut in half

The Words of the Prophet to bondholders:
  Sell now and not cry later

*note 1 The hand-writing upon the wall is a print etching and aquatint, hand-colored  by Js. Gillray  and shows  Napoleon, Josephine, French soldiers and women seated at feast with dishes "Bank of England," "St. James," "Tower of London," and "Roast Beef of old England." Napoleon looks in horror at hand of Jehovah pointing to words in sky: "Mene mene, tekel upharsin."  

note 2 from Daniel 5:25–28: "And this is the writing that was inscribed: mina, mina, shekel, half-mina. This is the interpretation of the matter: mina, God has numbered the days of your kingdom and brought it to an end; shekel, you have been weighed on the scales and found wanting; half-mina, your kingdom is divided and given to the Medes and Persians.
That very night King Belshazzar is slain, and Darius the Mede becomes King. (The end of the Babylonian Empire and the beginning of the Persian/Mede Empire)

note 3 short course with graphs showing inverse relationships of bond prices, interest rates, inflation

note 4 simpler explanation of bond value changes

Andrew Cuomo's Business Friendly Puff Pieces Fizzle As Reality And Medicaid Block Grants Close In

The February 7, 2011 post is updated, condensed and Medicaid Block Grant Implications added:   Updates are in purple.

Andrew Cuomo's Business Friendly Puff Pieces Fizzle As Reality Closes In

 Oh what a tangled web we we weave, when first we practice to deceive ~ Shakespeare

    Andrew Cuomo's business friendly with no tax increases puffing is about to burst.   His lackeys got puff pieces in the Wall Street Journal describing Cuomo as a “national spokesman for fiscal sanity” and in the National Review entitled “Cuomo the Conservative”   Cato Institute was fooled with "Cuomo the Conservative." 
They forgot Ronald Reagan's, "Trust, but verify."


   As of January 21, 2011, New York State, one of 30 States, borrowed $3,343,758,375.70 from the federal government for paying Unemployment Insurance.  Six States, Maryland, New Hampshire, South Dakota, Tennessee and Texas, have repaid their loans in full.    And since Cuomo didn't budget for this in his budget, he must be planning to pass it through to NY businesses. From NY Dept. of Labor, "the numbern average $478 per worker is due from employers."  How much more is New York borrowing this year to add to this $478 per worker?   Is this NY as business friendly?

       Did Cuomo fool his conservative/tea party supporters by having only a property tax cap passed by his request in the NY Senate?    Not really, when a County's Medicaid share is to rise 9.4%.   Where's the money coming from?  "UNYTEA’s Board of Directors has voted unanimously to endorse Governor Cuomo’s proposal for a 2% cap on property taxes, but only if it is accompanied by mandate relief."    And there is a $100 million dollar surcharge tax on medical procedures. passed on through business health insurance premiums

 Now a wake up call concerning Medicaid block grants and the Government posts biggest monthly deficit ever.


     Cuomo's budget plan calls for $30.2 billion to be given to New York by federal government for Medicaid.  New York matches this with $15.1 billion contribution by the State and a $15.1 billion paid by NY Counties paid in property taxes.   New York's 2008 Medicaid per person is $8,961 and the average State per person is $4,307.   If the federal government were generous and gave Medicaid Block grants at the rate received by the average State, NY would receive 4,307 divided by 8,961 x $30.2 Billion = $14.5 Billion.   New York budgets $60.4 billion, so $60.4 minus $14. 5 billion = $44.9 billion additional to be spent out of State money.  And if the federal Government were very frugal and used California's per person rate of $2,386, the block grant would be $8.04 billion  and $50.36 billion additional would need be spent out of State money. 
Any wise businessman would run for the border.



        Ian Welsh describes Cuomo and his cronies as "the people who hollowed out the US economy and caused the financial crash don’t pay the price of their evil, but in fact stay in charge of society despite causing a Depression and being  bankrupt."   Welsh asks, "Andrew Cuomo: stupid or evil?"   It doesn't matter, because he won't continue to fool people for much longer. 


      Bob Brinker, this weekend, after hearing of all the great retirements for government employees, now recommends that people move out of the high tax States with cooked Pension books.     Who's going to be left to pay for Cuomo's plans?  Medicaid recipients, government workers?   So the advice for residents of  budget challenged States is dump their bonds and move out. 
     
   So the advice for residents is to move out and dump the bonds and Andrew Cuomo and his deceived media calls this "Business Friendly."

Andrew Cuomo's Ad Promises Hope In Albany Budgeting, But Taxpayers' Hope Dims As Lobbyist Spending Reaches New High

  
Hope is for sale: make your best offer.

     According to lobbying data obtained from the Commission on Public Integrity, a record-shattering $210,664,067 was spent lobbying in New York State in 2010. ..an increase of 6.5%, ...Political parties and the governor received the most money in campaign donations from the top 25 interests.

  The Committee to Save New York, the monied, pro-Cuomo coalition is coming to Andrew Cuomo's rescue and in support of his budget plan with ads, which include his continued opposition to renewing an income tax surcharge on New Yorkers earning more than $200,000 and no new taxes.  The Committee to Save New York says, “but there’s hope, Governor Cuomo’s plan closes the budget gap without raising taxes.”


     The previous blog post here reported that in Cuomo's budget plan the Albany Lobbyist/insiders won all the first ten rounds of Budget battles, such as:
1. A cap was to be placed on local taxes, but Medicaid which is the largest budget item for Counties is up 9.4%
2. No new taxes were promised, but a surcharge on medical procedures tax will raise $100 million dollars.  The Employer Alliance for Affordable Health Care called the measures "nothing more than a hidden tax on New York's small business community."
3. "In the past week, health-care advocates brought in to advise Mr. Cuomo on Medicaid said he blind-sided them with back-room deals with the hospital industry and union workers."
4. "Localities were quick to knock the first report ... from Mandate Relief Redesign Team, saying it falls short of the reforms needed.  ...Gov. Andrew Cuomo ... is seeking to cap the growth in property taxes to 2 percent a year. Governments and schools said they would be hard-pressed to abide by the cap without having some state requirements removed." 
 
The Committee to Save New York's ad below has Andrew Cuomo offering Hope.  No price was mentioned, so contact the lobbyist nearest you.




Balance the budget when,  New York's Budgeted Medicaid Expenses To Rise to $15.1 Billion from this year's $13.851 billion?
Will Cuomo's new hidden taxes drive more people, business and jobs away? 


P.S.  Looking past the smoke, mirrors and illusions about the budget, the real world, past and present, is closing in. (the latest news)
1. Cuomo was tough on crime?  Still no Jail sentence for Hevesi, as the Judge in Alan Hevesi pension fund pay-to-play case is changed.   See Andrew Cuomo hopes to fool NY Sheeple

2.  The Chinese and other foreigners are closing in on US and State's debts, as the crisis in the Middle East has worsened, the latest exchange data show that traders are selling “short” the currency.   See Fiscal Disaster As Andrew Cuomo And His M.O. Are Slapped Down By Chinese Economic Reality Checks

The Albany Budget Insiders Have A Large Lead, But Hope Remains As The Mighty Andrew Cuomo Comes To Bat

It's how the game is played.

The Albany Budget Preliminary Score Card:
  People of New York = P  versus Albany Insiders = A
first ten rounds
P-0; A-1   1. Medicaid Redesign Team was cutting the budget, but the Medicaid budget is up 9.4%
P-0; A-2   2. A cap was to be placed on local taxes, but Medicaid which is the largest budget item for Counties is up 9.4%
P-0; A-3   3. No new taxes promised, but a surcharge on medical procedures tax will raise $100 million dollars
P-0; A-4   4. The court budget was to be reduced by 10%, but a 27% increase in courts budget is likely.
P-0; A-5   5.  Lobbyists were to be removed, but Jeffrey Sachs, Cuomo confidant and lobbyist, leads Medicaid Redesign Team's recommendations and then is absent on the day the previously written report is presented.
P-0; A-6   6.  Cuomo promises to clean out Albany swamp and then is MIA when the Chief Judge Lippman is accused of $40 million dollar crime.
P-0; A-7   7. Proposed cap on Medical malpractice is promised, but will likely be blocked by Sheldon Silver in NY Assembly. (This is the old Albany Follies sideshow, where one part proposes and other part rejects and nothing happenings.)
P-0; A-8   8. "In the past week, health-care advocates brought in to advise Mr. Cuomo on Medicaid said he blind-sided them with back-room deals with the hospital industry and union workers."
P-0; A-9   9. "Mayor Bloomberg slammed Gov. Cuomo yesterday for unveiling a stricter teacher-evaluation plan that keeps intact the "last in, first out" law requiring that layoffs be based on seniority rather than merit.... But, if it doesn't repeal LIFO as the law of the land, it simply kicks the can down the road."
P-0; A-10  10. "Localities were quick to knock the first report ... from Mandate Relief Redesign Team, saying it falls short of the reforms needed.  ...Gov. Andrew Cuomo ... is seeking to cap the growth in property taxes to 2 percent a year. Governments and schools said they would be hard-pressed to abide by the cap without having some state requirements removed."   "What irked some on the 23-member panel was that while they had discussions with Cuomo's staff about the final version of the report, they only saw it minutes before it was released publicly."

Score for first ten rounds:
People of NY = 0

Albany Insiders = 10

But Hope is here:

Then from 5,000 throats and more there rose a lusty yell;

It rumbled through the valley, it rattled in the dell;

It knocked upon the mountain and recoiled upon the flat,

For Cuomo, mighty Cuomo, was advancing to the bat.

There was ease in Cuomo's manner as he stepped into his place;

There was pride in Cuomo's bearing and a smile on Cuomo's face.

And when, responding to the cheers, he lightly doffed his hat,

No stranger in the crowd could doubt 'twas Cuomo at the bat.

Cuomo's Court Budget Heads For 27 % Increase Added To Medicaid Budget's 9.4% Increase

The talk was cheap, but the bill steep.

    So far, Cuomo's budget is increasing Medicaid expenditures by 9.4%.    Now, the focus moves to the Court Budget, where Chief Judge Lippman wanted a $50 million dollar increase over this year's $2.7 billion dollar budget.    But Lippman relented and has proposed a $100 million dollar decrease.

    That sounded good, but it is only a 3.7% decrease and Cuomo wanted 10% decrease.
But wait, 1. Lippman expects a Commission to give raises to the 1,300 Judges, with raises for Supreme Court Judges rising from $136,700 to more than $179,000 or 31% increase or $48 million dollars in judicial salaries to added to Lippman's budget.
.   2. The Judges are suing for $780 million in back pay to be added to Lippman's budget.

So the revised real budget arithmetic is:   $2.7 billion this year; minus -$100 million proposed by Lippman; plus +$48 million in judicial salary increases; plus +$780 billion in back pay; or court budget increases by +$728 million dollars or  a 27% increase.

   Cuomo's To-do or not do List includes criminal charges against Chief Judge Lippman

    Question? When will Cuomo chuck his no tax increase pledge (not with just some hidden taxes in his Medicaid  reform)  and add some real tax increases as Governor Brown is asking the voters to do in California for a $25.4  billion dollar gap?

It was do or not do and Andrew Cuomo tried ~ Yoda (revised NY version)

Cuomo Asked To Act On His Words With Chief Judge's Crimes.

When deeds speak, words are nothing.  ~African Proverb

Andrew Cuomo promised to clean out corruption in the Albany and that is impossible if the New York Courts are run by a Crook as Chief Judge.  See Chief Judge Lippman must step aside pending FBI probe.
Will Cuomo drop corruption ball link

Now, hear Andrew Cuomo Speak



Next, see what Andrew Cuomo does?

"The worst enemies of the republic are the demagogue and the corruptionist." ~ T. Roosevelt

Cuomo Has New Taxes Hidden As Medicaid Reform And Counties Medicaid Share Up 9.4%

The Devil is in the details ~ unknown

  Did you hear about New York's new business friendly atmosphere with Cuomo saying, "No new taxes, period," or that your property taxes will be contained.  Well, the devil is in the budget details.

1.  "[Cuomo's] redesign team ...calls for taxing radiology visits and physician-based surgeries...business groups across the state are hammering Cuomo on what they see as an about-face. His panel wants to expand the 9.63 percent surcharge on the other medical services to raise $100 million more a year. But that would add up to 2 percentage points more to health insurance premiums."
"The revenue-raising surcharge on medical services "is really a tax increase that will force employers and workers to pay more for health insurance," said Heather Briccetti, acting president The Business Council of New York State. ...  The Employer Alliance for Affordable Health Care called the measures "are nothing more than a hidden tax on New York's small business community."

2. Did the brilliant intellects at the Medicaid Redesign Team consider that the tax on medical services will also have to be paid by the New York State Medicaid plan?     Duh.

3. As reported on this blog yesterday: for the Counties, this year's Medicaid expenditure were $13.8 Billion and the cap on next year's expenditure will be $15.1 Billion(+9.4%)?
 Does increasing property taxes by $1.3 Billion not count as a tax increase?

    Someone is happy reports the New York Times, "New York’s influential health care workers’ union [SEIU 1199] appears on the verge of wringing significant victories out of Gov. Andrew M. Cuomo’s austerity budget, even as he nears potentially historic cuts in spending."

Unquestionably, there is progress. The average American now pays out twice as much in taxes as he formerly got in wages. ~H. L. Mencken