Perdido 03

Perdido 03

Sunday, December 4, 2011

Beware Cuomo's Call For Tax Code Changes

Governor Cuomo has stood fast to his pledge to Rupert Murdoch and Fred Dicker that he would not extend the millionaire's tax in New York State.

But this week he began calling for adjustments to the tax code that would work as an economic stimulus package of sorts.

The legislature isn't back in session until 2012, but Dems have said they will be returning to Albany on Tuesday.

Now comes words Republicans plan to return on Wednesday.

Gannett has more on why:

The Democratic governor in recent days has talked about an overhaul of the state's tax code as a way to spur economic development.

He is believed to be considering retaining higher income-tax brackets on millionaires and using the revenue — estimated by Assembly Democrats at about $2.8 billion a year — on middle-class tax cuts and job incentives.

Gannett's Albany Bureau reported Thursday that some Senate Republicans might support the proposal, which has yet to be released or circulated among rank-and-file lawmakers.

Senate Republicans and Cuomo have vowed to let an income-tax surcharge on those earning more than $200,000 a year expire at year's end. Cuomo and Senate Republicans this year teamed up to help pass a state budget that cut spending and closed a $10 billion deficit without raising taxes.

The state's fiscal condition is worsening. The state faces a mid-year budget gap of $350 million, which would be addressed in the special session. Next year's budget gap is at least $3 billion.

"Our members believe that the governor's economic program deserves a fair hearing, especially if he's talking about Senate Republican priorities like cutting taxes and creating private-sector jobs," said Scott Reif, spokesman for Senate Republicans. "We look forward to seeing a specific proposal."

While it is true that there have been rumblings at the Murdoch Post about Cuomo's move (the latest was Michael Goodwin's column today), Cuomo has worked very closely with Republicans this first year in office, so while Cuomo's people may be framing this as tax increases for the rich and tax cuts for middle and working class people that will spur job growth, it remains to be seen just what they mean by any of this.

The cynic in me says Cuomo is jiving here, especially since Senate Republicans are so willing to give this a "fair hearing."

Usually they're opposed to anything that smacks of tax hikes on rich people.

So what gives that they're willing to hear this one out?

Is it simple politics, wanting to look like they care about middle and working class people, so they're willing to hear the plan out?

Or is there something more nefarious between Cuomo and the Republicans on this?

Supposedly the tax changes will have to be revenue neutral.

Will that be done on the backs of unionized public employees?

He's already shoved hardball deals down the throats of CSEA and PEF, leveraging negotiations with the threat of thousands of layoffs.

The unions in the state have been calling for an extension of the millionaire's tax for a while now, joining with both Occupy Wall Street and Occupy Albany to call out Cuomo out on it.

Crains Business Week suggests this could be the reason behind the change in Cuomo's strategy:

The political drumbeat to reinstate the millionaire's tax, which has been given a big boost by Occupy Wall Street's attacks on the rich, has undercut Gov. Andrew Cuomo's “Government is the problem” mantra.


But I like to watch what these politicians do, rather than what they say.

As Michael Goodwin noted in his Post column today, Cuomo is a politician who has governed like a Tea Partier, slashed spending on schools and senior services, cut taxes on the wealthy, used layoffs as leverage to get major concessions out of the unions.

I'm not ready to believe that Cuomo is giving that governing style up or the love he receives from Dicker and Murdoch for having it.

I'm waiting for some deal between Republicans and Cuomo that replaces the existing millionaire's tax with some very moderate tax on millionaires that comes nowhere near replacing the revenue from the old tax, then hammering the unions on pensions and health care costs as an offset.

Can't you see Cuomo, that smarmy grin on his face, calling the unions on the millionaire's tax, saying he's giving them exactly what they want on it, but they have to pay up for it too?

I can.

I hope this concern is unfounded, hopefully Cuomo really does feel squeezed on the politics of the millionaire's tax.

I hope Little Andy does indeed feel "Occupied."

But I won't believe that until I see the details of the plan that ultimately gets passed and signed into law.


  1. Fix: the legislature goes back into session in 2012.

  2. reality-based educatorDecember 4, 2011 at 7:55 PM

    Oops - thanks!