WE MUST PASS THE PRESIDENT’S BALANCED APPROACH TO OUR LOOMING CRISIS

By Ken Biberaj

I recently attended a briefing at the White House with business leaders from around the country. The message was clear: Going off the fiscal cliff would be devastating to every sector of our economy. The president understands this and is willing to take hard steps to solve it, but the House Republicans have not acted in kind. We need their action.

The automatic cuts associated with going off the cliff would cause a loss of jobs, cuts to essential social serves and higher taxes for all Americans, likely resulting in a double-dip recession at a time when we are making steady economic progress.

Our country cannot afford this option, and there is no excuse why our leaders in Washington cannot come to an agreement. Those stubbornly refusing to act are more interested in self-preservation. The only option is a deal that addresses both spending and revenue. The president’s balanced approach to the situation would restore confidence in our political system and markets by providing greater certainty for businesses, and lowering the debt burden we pass on to our children.

If House Republicans do not act, the mandatory reductions will take a sledgehammer to Social Security, Medicare and other programs that are essential to our seniors. The average middle-class family will see an immediate increase of $2,200 in taxes. This is not the way to cut the deficit. The president is willing to compromise and address cuts in a way that protects seniors and keeps the economy moving forward. A version of the Bush tax cuts for middle class Americans has already passed the Senate, and the president is prepared to sign it. Now the House Republicans need to vote for it.

The stakes are especially high for New Yorkers.

State Controller Tom DiNapoli recently projected that working New Yorkers would see a $43 billion increase in taxes and 3.4 million people would also be forced to pay the federal alternative minimum tax. All in all, the state would witness an automatic drop of $600 million in federal funds—devastating local budgets. This, coupled with the projected costs associated with the recovery from Hurricane Sandy, would put our most vulnerable communities, small businesses and seniors at risk. New York City is surviving the recession, but not on even footing: Issues of inequality have been exacerbated. Not responding to the fiscal cliff would hurt those already suffering the most.
The Congressional Budget Office estimates that consumer confidence would nosedive if a deal is not made; resulting is nearly $200 billion less in spending next year. The taxes in our city are already high. Adding a tax increase on middle-class New Yorkers coupled with a double dip in the recession would cripple New York businesses, especially those that benefit from the over 50 million visitors who come through our city each year, a major part of the New York economy. Places like the Russian Tea Room, which benefit from this tourism, would be hit even harder by reduced travel and spending in our city.

As a businessman, I believe the White House approach is the only real option available. Yet as we get closer to the cliff, it is becoming clear that the Republicans are not willing to make the obvious choices that are needed to keep our economy moving forward. I urge all New Yorkers to look past the distractions and recognize that going over the fiscal cliff is not an option. Act now and call our elected officials in Washington to push them to support a balanced approach. In 2013, we need our leaders to turn their attention to other important issues that affect New York’s economy: immigration reform, innovation and infrastructure, to name a few.

Running a business in New York City is very challenging, and as the Russian Tea Room celebrates its 85th anniversary on West 57th Street, we hope that our leaders in Washington don’t make it even harder for us to survive the years to come.

Ken Biberaj is the VP of the Russian Tea Room and a Democratic candidate for City Council on the Upper West Side (www.ken2013.com). The views expressed here are those of the writer and not the Russian Tea Room.

By Alan S. Chartock

Political theorists have long raved about the advantages of balanced government. It is always best to have one independent branch looking over the shoulder of the others; balanced government helps prevent abuses.

When the very popular Andrew Cuomo was elected governor, it could easily be said that he had a mandate from the people to clean up Albany. In fact, that’s exactly what he said he would do. Unfortunately, from this perch, Albany looks pretty much the same as it always has.

We still see the powerful legislative majority leaders drawing districts that give them a better chance of winning. We still see legislators asking for raises and likely getting them while they dismiss the possibility of raises or pensions for civil servants, including our teachers.
There are some very dangerous things happening in the state capital. One of the most dangerous is a move by the powerful governor to take away the “pre-auditing” function from the independently elected state comptroller. The people who wrote the state constitution made the comptroller independent so he or she could audit the other branches. Anyone who runs a business or a not-for-profit organization knows that at least once a year, businesses have to be audited.

In New York State, the comptroller has always had the ability to pre-audit contracts. That means that before a state contract can be let, the comptroller has to take a look at it to determine if there is any bad smell to it.

Is a contract about to be let to people who are fiscally enigmatic? You wouldn’t want suspicious people like the mob pouring the concrete for the soon-to-be-rebuilt Tappan Zee Bridge. You wouldn’t want suspicious people running a large gambling casino in Queens. Without this important pre-auditing function, by the time the contract had been let, the horse would have long been out of the barn.

Unfortunately, the power to pre-audit major contracts was taken away from the comptroller in the powerful governor’s budget. When that happened, my eyebrows shot up toward the sky. Why in the world would you take this kind of protection away from the people of New York? I wrote about it in this column; I opined about it on the radio, but the response was anything but deafening. The subject, esoteric as it was, was ignored by almost everyone.

I recently spoke with State Comptroller Tom DiNapoli about it on the radio. He was not reticent in his response. When I asked him about the governor’s move to strip him of the important pre-audit function, he said the move “made no sense.” And, with imaginary dark music playing in the background, DiNapoli said that he hoped that there would be no other moves like this one to cut down on the comptroller’s powers. He has always said, “It is my responsibility to be an independent voice, and I take that very seriously.”

It is no secret that DiNapoli was not Cuomo’s choice for the comptroller’s job. DiNapoli is the kind of guy who gets along with everyone. Cuomo’s reticence in supporting his fellow Democrat was perplexing.

When the comptroller’s office is vacant, it is the Legislature’s responsibility to fill the office. The Legislature elected DiNapoli, who then went on to run for a full term without fellow Democrat Cuomo’s support. Anyone besides DiNapoli might have resented that just a little, but DiNapoli is like Ferdinand the Bull: He does not like these things to become personal, he’d rather just smell the flowers.

Despite that attitude, the more bellicose Cuomo has carried the fight to the comptroller for no good reason that I can see. Maybe it’s that the comptroller could get in the way of some of the governor’s plans.

In any case, I’m glad I asked DiNapoli the question and I’m especially glad that he answered it. Sometimes, even Ferdinand got angry—like that time he got stung by the bee.

Alan S. Chartock is president and CEO of WAMC/Northeast Public Radio and an executive publisher at The Legislative Gazette.