NYS budget

NYS is messing with its Early Intervention program--again

With all the taxpayer money the state squanders on utterly useless programs...or all the taxpayer money that is lost to fraud or outright theft (if you doubt those things, spend a few minutes perusing Comptroller DiNapoli's missives), you would think the governor could find some other pies to stick his fingers into other than Early Intervention.

According to the information put out on some Assembly members' websites, the governor's "Executive Budget recommends a series of modifications to the Early Intervention Program that will expand insurance coverage and streamline eligibility determinations, without impacting services, to provide significant fiscal and administrative mandate relief to counties and generate savings totaling more than $60 million over five years."

Sounds wonderful, but an organization called United New York Early Intervention & Related Service Providers With Parents as Partners (UNYEIP), composed entirely of volunteers and with no paid lobbyists, says...not so much and not so fast.  Read their response to the governor's executive budget proposals, but here are a few highlights:

  • Nine significant changes to the EI program have been instituted over the last three years that have impacted providers, caregivers, and the children served, but the effects of those changes have yet to be adequately evaluated.
  • The presence of an insurer representative at individual family service plan (IFSP) meetings would be required. Umm, sounds like a damper to me.
  • In-network providers would be required.
  • Providers would be required to negotiate rates with insurers.
  • One good thing in all of this is the acceptance of the idea that the location for early intervention can occur in natural environments that could be the home. Seems like a no-brainer.

The changes to the EI program will be coming up in the legislature on Friday, so contact (preferably by phone--that has much more impact) your assemblyman and your senator right away.

You could even tweet them this message: REJECT ALL EI PROPOSALS. READ THE UNYEIP 8 Recommendations and 9 Reasons To Reject at www.unyeip.org/ announcement. html in the UNYEIP Pink & Blue Book!

Many of us know a child with special needs.  We may be related to such a child. NYS Early Intervention is a program that has far-reaching societal implications and is a significant, life-changing program for a child with special needs and his/her family.


Magnetic Medicaid

Do read the whole article in today's Ithaca Journal, but here are some highlights (or lowlights):

New York leads nation in spending on social aid

ALBANY — Here's another distinction for New York: It gets more government aid per person from social programs than any other state.

A USA TODAY analysis Tuesday found that the state's Medicaid program is the most expensive in the nation, driving the average cost of all government benefits in New York to $9,442 per person — the most in the country...

Of course, as a commenter on this piece remarked, the article almost needs "To be read last paragraph first" for the sake of clarity.  Nevertheless,

[....] spending on Medicaid, the health program for the poor, has long exceeded other states because of New York's broad initiatives and high poverty levels... 

[....] New York had to close a $10 billion budget deficit for the 2011-12 fiscal year, which began April 1. The Legislature largely adopted the recommendations of Gov. Andrew Cuomo's Medicaid Redesign Team, which will produce savings of $2.8 billion for the $53 billion Medicaid program...

[....] The program represents about 26 percent of the state's operating budget, slightly more than school aid, according to a report from the Medicaid Redesign Team.

Medicaid enrollment has soared, from 2.7 million enrollees in 2000 to 4.7 million in 2010 — fueled by an aging population and an expansion of the Family Health Plus and Child Health Plus programs for people whose incomes are too high for Medicaid benefits. (emphasis mine)

[....] The state and county governments split the cost of the state's share for the program. [E.J. McMahon, senior fellow for the conservative Empire Center for New York State Policy, said] That has blurred financial accountability and allowed state lawmakers to "buy up to a dollar's worth of political capital for 25 cents,"...

McMahon said he doesn't think the Medicaid redesign will make much of a difference. The state would have to look at eligibility to have an impact, he said....

[....] But Frank Mauro, executive director of the labor-backed Fiscal Policy Institute [and a favorite of Barbara Lifton's--tvm], said New York's Medicaid benefits are on par with neighboring states. New York has a higher poverty rate than they do, so its per capita spending exceeds other northeastern states....

So, let's just say that in the very short tern anyway, the situation is what it is.  What's the outlook for NYS particularly under Obamacare, a topic that isn't touched on apparently in the USA Today study?  According to a paper recently published by Cato, "The New Health Care Law's Effect on State Medicaid Spending: A Study of the Five Most Populous States," it's not looking good for NYS:

Unless it is repealed, the Patient Protection and Affordable Care Act of 2010 promises to increase state government obligations for Medicaid by expanding Medicaid eligibility and introducing an individual health insurance mandate for all U.S. citizens and legal permanent residents...PPACA provides states with no additional federal financial support for new enrollees among those eligible for Medicaid under the old laws. That makes increased state Medicaid spending from higher enrollments by “old-eligibles” virtually certain as they enroll in Medicaid in response to the individual mandate to purchase health insurance.

....Both Illinois and New York have the potential for considerably higher enrollments and increased expenditures.

Why are IL and NY "qualitatively different" from the other states?

Population projections for Illinois and New York (shaded) exhibit considerably greater constancy, both in population size and age composition, and suggest that Medicaid expenditures will not increase as rapidly in these two states compared with the other three states with more robust population growth and faster aging population.


The point is that you don't need to understand regression analysis in order to be able to see that while the current Medicaid situation in NYS is bad, under Obamacare as currently configured it would be even worse...and not only for fiscal reasons, but for societal reasons as well.  As E.J. McMahon says in the Journal article, "This is really a measure of dependency on government." 

And on a related note: Ace went to Andrew Breitbart's book signing, where Breitbart commented on the sheer wonderfulness of Ace commenters.  It's true that you can learn a lot from comments on internet postings, sometimes more than you learn from the original article itself.  I often recommend here that people read the comments attached to an article we link to. In fact, one of today's commenters at the Journal inspired both the title of this post and the illustration. So read the comments on the Journal article already.

The economy, the budget...and the Cubbies

Commentary by Tom Reynolds:

Let’s add some perspective to recent statements in the Ithaca Journal.

Some believe that Franklin Roosevelt’s New Deal ended the Great Depression, which started in 1929 and ended sometime between 1941 and 1946.  At best, that’s 12 years!  Is that an example to follow?  If we imitate Roosevelt’s policies, should we expect the current recession to end in 2020?  

Roosevelt’s policies were as effective as the Chicago Cubs’ management strategies.  It took a World War to overcome Roosevelt’s policies and the same World War to get the Cubs into a World Series.

In 1920, the US economy took the biggest, single-year drop in history; worse than any single year in the Great Depression.  In July 1921, (just 1 ½ years after that depression started), the recovery began.  What did the US Government do?  Nothing!  How come that Depression doesn’t get mentioned?  

Actually, the Secretary of Commerce, Herbert Hoover, was planning a massive intervention but the 1921 Depression ended before he could intervene.  Unfortunately, he had more time in 1929.  

Hoover was probably a Chicago Cubs fan.

Some people justify taxing the rich as if higher taxes have no effect on the decisions of the wealthy.  If so, why hire tax accountants and tax lawyers?  Have you ever heard of a tax preparation service advertising for business on the basis of calculating your “fair share” of taxes?

Some deny that union donations control the government.  In political donations since 1989, twelve of the top twenty donors are unions.  They are #s 2, 3, 7, 8, 9, 10, 11, 12, 13, 14, 17, 19.  Who is #1?  ActBlue, a Democratic Political Action Committee, made the highest total donations since 1989 even though it only came into being in 2004 (www.opensecrets.org).  In the 2010 races, ActBlue was also #1, giving more than twice as much as the # 2 donor, SEIU.

Now it’s the Tea Party that’s controlling the government!  Could SEIU be an acronym for the Tea Party?

“Greedy bankers” are blamed as the cause of the 2008 financial crises that started the recession.  Certainly, bankers found creative ways to unload the bad debt that they had accumulated.  But the root cause was the bad debt, not the bankers.  Where did the bad debt come from?  The primary answer lies in the federal government using the “Community Reinvestment Act” to force bankers to make loans they did not want to make to people that could not repay the loans.  No “Community Reinvestment Act” and, probably, no financial meltdown and no recession. Reagan was right; government is the problem!  

Reagan began his career as the radio voice of the Chicago Cubs, so he learned to recognize bad ideas very early in his career.

NY politicians decry how hard it is to cut the proposed budget by $10 billion to balance it.  The official state budget is about $130 billion, but there is another $50 billion in Public Authorities that should be—but don’t—get counted in the budget.  Add them together and the proposed budget was $180 billion and needed to be cut by 5.6%. In my 36 years of preparing budgets at for-profits and not-for-profits, the original “proposed” budget was ALWAYS more than 5.6% out of balance.  My experience is the norm, not the exception.  Balancing a proposed budget by less than 6% would have been considered a walk-in-the-park. 

Wait!  Last year, NY State tried to close state parks; maybe that’s why balancing the budget wasn’t a walk-in-the-park.  Again, Reagan was right; government is the problem!  

From 2001 through 2011, the NY State budget increased by $50 billion.  Had it increased by the rate of inflation, it would only have risen by $20 billion.  So the increase was 2 ½ times the rate of inflation!   And remember, the $10 billion they now had to “cut” was over-and-above the $30 Billion that was over-and-above the rate of inflation. 

Perhaps the solution to our economic problems—the national ones anyway—is to stop finding our political leaders in the same city that brought us the Chicago Cubs.


tvm—with my apologies to the original artist (although, really, the same graphic could be used every year):

A version of Tom's op-ed appears in today's Ithaca Journal.

Amo, amas, amat...

On the NYS budget deal, it almost seems like a Nancy Pelosi moment:

At the WSJ:

The governor's handshake deal with legislative leaders isn't yet enshrined into law, and important details about the spending plan won't be known until the bills are passed and signed.

Or maybe it's like the Bobby Short/Woody Allen video below.  You love, love, love it—AMAS, The Albany Mutual Admiration Society, has managed to produce a NYS budget and so everything is all sweetness and light:

On Sunday evening, at a news conference at his executive chambers in Albany, Mr. Cuomo sounded buoyant and relaxed. "I'm hoping that this spirit of love and euphoria that I feel is infectious and grows and continues," said Mr. Cuomo, giving a knowing grin to Republican Senate Leader Dean Skelos and Democratic Assembly Speaker Sheldon Silver.

"I hope you keep feeling it," said Mr. Silver, eliciting a hearty laugh from Mr. Cuomo.

Awwwww. Isn't that just great?

So what do we know about this deal?

The budget also closes a $10 billion gap without raising income taxes.

Period. This is interesting because the articles that originally appeared last night (like this one at the NYT) said that the budget would "address a $10 billion deficit without raising taxes or borrowing money" (emphasis mine). Funny—doesn't say that any more.

...the agreement sidestepped a few contentious issues, leaving them to be sorted out in the last three months of the legislative session.

The budget doesn't contain any caps on local property taxes, a key campaign promise of the governor's.

But...but...the NYT article from last night said, "[....] The budget doesn't increase taxes..." Hmmmm, there's no cap on property taxes....what could go wrong?

And while it assumes more than $2 billion in Medicaid savings, a fraction of that comes from across-the-board rate reductions to hospitals and other providers. About a $1 billion or more of Medicaid cuts haven't been fleshed out but exist merely as vaguely defined targets.

The budget also counts on $1.4 billion in negotiated labor savings and across-the-board agency cuts—both of which may never materialize.

Another interesting thing about the articles that appeared last night is that they did not explicitly state that the budget actually balanced. What they did say was, "The budget also addresses a $10 billion deficit..."  Is addressing a $10B deficit kinda like addressing the ball?

Assembly Speaker Sheldon Silver called the budget "grounded in reality..."  We're just going to have to suspend our disbelief until we "see what's in the bill."

State Senate Passes Budget Resolution

State Senator James Seward comments on the passage of a budget resolution (March 15, 2011).  You can find his pull quotes on his web page...

Report: Barbara Lifton town hall in Newfield, Part 3

Third in a series

Part 1 on taxes is here

Part 2 on the economy and economic policy is here.

Governor Cuomo said, “You can never solve a problem if you refuse to acknowledge it.”  After listening to Assemblywoman Lifton, at her town meeting, she obviously is not heeding his words.

New York State’s Budget:

Governor Cuomo wants to shift the way budget cuts are viewed.  He says a cut is how much spending changed between the latest enacted budget and the new one, not how much the anticipated increase was cut. 

Assemblywoman Lifton speaks only of the cuts to the anticipated budget and not the actual increase or decrease.  She said that they (the legislature?) have cut $19 billion in the past few years and the Governor’s budget cuts an additional $9 billion.  Based on her numbers, over the past 3 years the anticipated increase was $31 billion; that’s an anticipated increase of 25%!  “They” cut $19 billion, so she wants credit for a $19 billion decrease and ignores the $12 billion increase!  This is a failure to acknowledge the problem.  (Of course, she thinks letting taxes go up when the current tax schedule expires on December 31st won’t be a tax increase, either.)

She goes on, at length, about individual cuts to departments in the Governor’s budget.  Of course, she never mentions the actual changes (which may not even be cuts) – only the anticipated cuts.


This guy's got guts:

Being an educator in Upstate New York I am forced to pay dues into the corrupt union structure, even though I am not a member nor intend to be. Among the many benefits of (not) joining one of the public employees unions in New York include the union taking nearly one percent of my gross pay to use towards political campaigns.

Among the "benefits" not immediately clear is a mandatory subscription to their monthly propaganda. This month's naturally rails against the cuts of Democratic Governor Andrew Cuomo as well as against Governor Walker's actions in Wisconsin.


NYSUT United calls for the state to reject a property tax cap-- even after the state has seen massive tax increases over the last decade, especially in rural and suburban areas. They call the cuts made by then-Governor David Paterson last year 'draconian' and rail against Andrew Cuomo's cuts of $1.5 billion, or triple last year's cut.


Within the publication comes an exhortation to retain the so-called 'millionaire's tax' in New York State-- that affects those making $209,000 a year. According to the article:

NYSUT... is insisting lawmakers extend the surcharge on high earners...to help the state deal with its $10 billion shortfall.

NYSUT is one of the most politically corrupting unions in the country. They have driven New York State's education system into the ground and have devastated college education programs in order to drive down potential teachers and create an artificial shortage of teachers....

Read the whole thing.

UPDATE: Michelle Malkin has more on this story here.

The rub

Although our circumstances in NYS are not precisely parallel, we can learn from the experience of our Massachusetts neighbors who voted in a 2.5% property tax cap 30 years ago. This article appeared in the Buffalo News recently:

Massachusetts offers less-taxing lifestyle

WEST STOCKBRIDGE, Mass. -- Something happens as the green "Welcome to New York" sign fades in the rearview mirror when you cross into Massachusetts: Taxes go down.

They are lower on clothing purchases. On gasoline, on furniture, on alcohol and on a range of goods and services. On businesses. And personal income is taxed at a lower rate.

But, most noticeably, property taxes are lower...

There's a lot of grist for the thoughtful reader's mill in this article, much of it having to do with just plain economics, which is classified with other social sciences for a reason—to a great degree, it has to do with how actual people behave in the actual world. And when something changes in that world, people's behavior changes as well, particularly for those at the margin (quite literally in this instance):

"Realtors in Massachusetts do use the taxes as a selling point," said Martha Piper, a broker associate with Stone House Properties in West Stockbridge.

"The difference in taxes is almost double between the border," said Ed Hoe, president of Kinderhook Real Estate Co., an agency based in Columbia County, N.Y., that does business on both sides of the border. Homebuyers use the tax difference to try to work better deals for houses on the New York side, he said.

"What it ends up doing is having an adverse effect on value or what people are willing to pay in New York State," he said.

Clearly, those who live and work along the border between NYS and Massachusetts respond rationally to things such as differences in tax burdens between the two states. There are those, like Barbara Lifton, who resist the notion that people behave in such a rational fashion.  But resistance is futile.

Another point:

...said Andrew Bagley, research director at the Massachusetts Taxpayers Association, a nonpartisan policy group, "Yes, you can control property taxes. It just means the money has to come from somewhere else -- unless you want to eliminate services," he said.

Aye, there's the rub! You can play the fiscal shell game, capping property taxes but continuing to spend like a drunken sailor and finding other "sources of revenue" to pay for that spending, or—you cut spending.  And as American Majority says:

...cutting government spending isn’t easy.  Almost regardless of what elected officials would try to cut from their government’s budget, there would be strong opposition from those currently benefiting from that government spending....

Once a person benefits from government spending, they rely upon it and will be extremely motivated to contact their elected officials if there is even a rumor of cutting that spending.  Almost without fail, there will be stronger political pressure to not cut spending than the political pressure to reduce the spending.  Moreover, government agencies always think their budgets should grow, regardless of the effectiveness or necessity of their programs.  It takes a tremendous amount of courageous commitment to see a proposed spending cut through to be enacted into law.

Looking around the country, even Democratic Governors...are proposing budgets with significant spending cuts.  In New York State, for example, Governor Cuomo, a Democrat, announced a budget with cuts to many government programs...

Stay tuned.

There's much, much more in the Buffalo News piece.  Do read the whole thing.

On a tip from Tom

Cap and trade spur growth

No, I haven't taken leave of my conservative senses.  What I mean is: cap property taxes in NYS (as we've mentioned in several earlier posts) and trade more government spending for less.  Heritage has reported:

A considerable volume of cross-country analysis has found no positive impact on economic growth from more government spending. Many studies (see here and here, for example) find that government spending actually hurts growth....

No surprise there.  Here's what they found:

So how does NYS fare when we look at government spending as a function of state GDP?  Well,...

...as you can see, government spending in NYS has for years run well above the 15% of GDP that serves as a line of demarcation between growing economies and those that are stagnant (or worse). If there's to be any hope of slowing or even reversing the loss of productive people and businesses from the state, we're going to have to drastically change how we do things here.

The Big Guy goes to DC...

...and NYS should be watching to see how it's done.

See Pundit & Pundette on Chris Christie's visit to Washington today (and see the first comment for my take on Christie—no, I didn't write it but I could have).

In view of the entirely predictable stories like the ones on today's front page of the Journal, and Barbara Lifton's town meetings scheduled for next week on the proposed state budget, enjoy and learn from what's commonly referred to as "Chris Christie porn." There's much more Christie porn out there, but this one will whet your appetite:

And on a related note: "Madison schools closed Wednesday due to district-wide teacher sickout"

UPDATE: More on today's Wisconsin story here. And a series of videos re: the Michigan public schools here. (via Ace)


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