A public chief executive has three jobs: policy, management, and leadership. With leadership being using one’s influence as a public figure, in competition with celebrities and marketing influencers, to change what people voluntarily do on their own, rather than what the government forces them to do or does for them. For state and local government, the key policy is the budget — who is made to pay how much, and what it is spent on, compared with the past and compared with other places. Management determines how much in services and benefits people actually get for that spending.
Mayor Bill DeBlasio and Governor Andrew Cuomo spent much of their tenures feuding. They would have you believe it was over policy and ideological differences. I believe their primary ideology is careerism, the advancement of their own careers to higher office, and this made them rivals — and the rest of us and our futures pawns. Perhaps that’s why both “President” DeBlasio and “President” Cuomo left office widely despised.
But what did they actually do? Even as we just had an election for Mayor, and are currently having an election for Governor, the media doesn’t seem to be talking about it, other than issues of the moment such as bail reform.
Most people can’t do it, but one ought to separate what the pols do from the broader situation. DeBlasio and Cuomo didn’t cause the opioid epidemic, the surge in homelessness, or the COVID-19 pandemic, or in Cuomo’s case, the long-term economic decline of Upstate New York. But they didn’t cause the economic boom and soaring federal debt that allowed them to pander to every special interest group without completely screwing anyone else except transit riders and the later-born (until the future) either. With regard to the budget, I’ve created some charts that make a fair and perhaps telling comparison. This post will briefly describe what I plan to do, with additional posts making the comparisons to follow.
I’m going to present some Census Bureau government finances data on state and local government revenues and expenditures in FY 2019, before the pandemic and at the peak of an economic expansion that was the biggest boom in NYC compared with the rest of the country since the 1920s.
It was driven by college educated Millennials, members of a relatively large generation, deciding that New York City and a few other places were the places they had to be, because they were the only places left in this country where they could “get a life.” Businesses moved in to take advantage of the cheap labor, as median pay fell for lower education levels, even as rents soared. Young workers paid lots of taxes, received little in public services, and were forced to crowd in with roommates to afford those soaring rents. They were the exploitables, and they were exploited.
This provided lots of money for Cuomo and DeBlasio to spend. Who got it?
Choosing the right years for comparison, and normalizing for inflation and income, is the key to understanding what has actually been done, rather than what has just happened. The pandemic, and the gusher of borrowed federal money that came with it (which we will pay for the rest of our lives), are not indicative of state and local government policy choices. Although it would seem that the disaster has allowed Generation Greed politicians at all levels to have an economic orgasm, providing an excuse to do on a massive scale what they had been doing at a lesser scale for decades — cash in the future.
The problem with FY 2020 to FY 2023 is that they are unusual and misleading years. It’s the same problem I had with the FY 2002 Census of Governments, which happened to measure New York City’s budget and public employment in the wake of 9/11. So instead, I’ll measure the actual choices of DeBlasio, Cuomo, the state legislature and city council circa FY 2019, before the pandemic. When they should have all the money they could ever ask for, a fortunate circumstance that made them less unpopular than they should have been.
How can FY2019 be compared with the past? It can only be compared with other peak bubble years. The Pataki and Bloomberg Administrations were in office at another economic peak in FY 2007; the Pataki and Giuliani Administrations were in office at the peak before in FY2000, and the Mario Cuomo and Koch Administrations in were in office in FY1989, another peak year. What about the Dinkins and Spitzer/Paterson Administrations? They didn’t have an economic upturn to spend the proceeds of, and perhaps that is why they were out after one term. With Paterson having to deal with “President” Spitzer’s interest group handouts just before a recession too.
With the exception of FY 2007, the other years — FY1989, FY2000 and FY2019 — are not Census of Governments years. In between the five-year Censuses, the Census Bureau conducts a survey and provides state-level estimates only of state and local government revenue, expenditure, and debt. Because the City of New York and Port Authority of New York and New Jersey are always in the survey, however, I can provide estimates for New York City (allocated PANYNJ data) and the Rest of New York State separately.
So, I’ve produced charts for revenues and expenditures for the four years for the U.S. average, New York City, the Rest of New York State, and nearby states — Connecticut, New Jersey, Massachusetts and Pennsylvania.
To adjust for the availability of income to support public revenues, expenditures and debt in different places, and the cost of living that tends to vary with it, I measure state and local government revenues, expenditures and debt per $1,000 of state (or NYC and Rest of State) residents’ personal income, as measured by the Bureau of Economic Analysis.
But remember, the various bubbles (junk bond/commercial real estate in the 1980s, dot.com in the 1990s; housing in the 2000s; and everything in the 2010s) temporary inflated New York’s total income during these years, allowing interest groups to grab more and have it “cost nothing.” When that extra income, generated by Wall Street in New York, disappears, that’s when we find out who actually is going to pay, and how. In looking at these years you are looking at the best of all possible worlds for NY city and state politicians. In a year or two or three, I won’t want to hear from members of that tribe and their supporters that whatever they will do to us as a consequence is “due to circumstances beyond our control.”
And hopefully they won’t have a President Trump nationally to blame for what they have in fact done here in New York.
As is my custom, I’m going to provide the spreadsheet with the majority charts I’m going to use up front, so people can see it and draw their own conclusions before getting my take on it.
Though I might add a couple more after thinking about things.
Since I have it, I’ll also use some per-student public school spending data, adjusted for inflation, for FY 2007 and FY 2019, as previously discussed in this post.
For New York City, the Downstate Suburbs, and New Jersey I adjust that data downward for the higher average wage/cost of living here — using a very generous adjustment that makes out per student spending look lower than it would be as others might present it.
I’ll use a chart or two from my long-term data on how much different state’s future has been sold out due to debts, public employee pension increases and underfunding, and inadequate infrastructure construction expenditures.
And I’ll use a few FY 2007 vs. FY 2019 charts from an analysis of the NYC budget, based on city budget documents, showing changes in inflation-adjusted spending by agency.
I had compared the FY 2022 budget proposal with FY 2014 and FY 2007 expenditures last year.
I could go back and replace the budgeted numbers with projected actuals from the latest city budget documents, to see how the pandemic and flood of federal money changed the city’s budget. But that got much harder to do under the DeBlasio Administration, with the “full agency cost” table only used for next year’s spending, and not presented for this year or prior years. And frankly, I’m a little burned out.
Someone else could download the spreadsheet from the post above, move the numbers around, and get the projected FY 2022 actual from this document to create a FY 2014 (Bloomberg’s last budget) to FY 2019 to FY 2022 (DeBlasio’s last) if they wanted to, by going agency by agency through this document.
Starting with the Department of Education on page 78. Of course, that would be much easier of OMB were to replicate the FY 2023 budget proposal on page 77 for the projected actual for FY 2022, and some past years, as was the case in the Bloomberg Administration — before the DeBlasio/Stringer/Cuomo/DiNapoli era of deception really got going. But we have long since passed peak transparency in this country, and I doubt that is ever going to happen.
Meanwhile, I’ll start with NYC and NY State fiscal policy, compared with the U.S. average and nearby states, and start dropping and describing charts, when I can.