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The Green Alternative to Austerity Budgets

The Green Alternative to Austerity Budgets

Austerity budgets mean a whole generation of school children bear the burden of closing budget gaps with cuts in state funding for public schools. They mean scores of towns, school districts, counties, and most upstate cities bear the burden of fiscal distress and impending insolvency because state revenue sharing has been slashed.

How long must we wait for meaningful steps on progressive goals like living-wage jobs for the unemployed in public works and services, fully-funded public schools, tuition-free public colleges, health care for all, affordable housing and mass transit, and climate-safe clean energy?

The Green Alternative to Austerity Budgets

by Howie Hawkins

Andrew Cuomo justified his first austerity budget with this self-contradictory statement: “I am a progressive Democrat who’s broke. I disagree with the concept that the only way to get better services is more money, more money, more money.”

In other words, Cuomo made the state broke by choice. A more progressive tax structure would yield increased revenues to fund progressive priorities while providing tax relief to low and middle income New Yorkers. But such progressive policies are off Cuomo's agenda.

Cuomo's 2014-15 budget features tax cuts for banks, corporations, and the heirs of multi-millionaires, with $7.2 billion in unspecified spending cuts over the next four years in order to manufacture a future $2 billion “surplus” he devotes to rich folks' tax cuts.

With Cuomo's fourth austerity budget, we face a full decade of austerity: two Paterson budgets following the 2008 economic crisis, four Cuomo budgets, and Cuomo's financial plan for the next four years.

Austerity budgets mean a whole generation of school children bear the burden of closing budget gaps with cuts in state funding for public schools. They mean scores of towns, school districts, counties, and most upstate cities bear the burden of fiscal distress and impending insolvency because state revenue sharing has been slashed.

How long must we wait for meaningful steps on progressive goals like living-wage jobs for the unemployed in public works and services, fully-funded public schools, tuition-free public colleges, health care for all, affordable housing and mass transit, and climate-safe clean energy?

Now that the “one house” Senate and Assembly budget bills are out, it's clear that state legislators don't have a progressive alternative to austerity. All they suggest are small changes that tinker around the margins of what remains a belt tightening budget.

Bipartisan austerity is a major reason why the Green Party runs independent pro-worker, pro-environment candidates. What would a Green budget look like?

Greens would have the rich pay the tax rates they used to in the 1970s. That would yield about $30 billion in additional revenue.

$8 billion from the Progressive Income Tax: The more progressive personal income tax structure of the 1970s would raise far more revenue from the top 5%, while giving 95% of us a tax cut, according to a Fiscal Policy Institute analysis.

$15 billion from the Stock Transfer Tax: This tax of pennies per share traded has averaged around $15 billion in recent years, but has been 100% rebated since 1981.

$7 billion from Cutting Corporate Welfare: So-called economic incentives to corporations in the form of tax breaks and subsidies were negligible in the 1970s. Now they are $7 billion a year. A report for Cuomo's Pataki-McCall tax reform commission found that the nine-fold increase in these business incentives since 1994 resulted in a net loss of 175,000 jobs. This waste should be eliminated.

How would Greens spend an extra $30 billion?

$5 Billion for Revenue Sharing, Mandate Relief, and Tax Relief: Instead of Cuomo's top-down, one-size-fits-all property tax relief plan, restore revenue sharing to 8% of state revenues enacted in 1979 and let local governments decide for themselves how to distribute these unrestricted funds between cutting taxes and paying for state mandates, schools, and other public services.

$3 Billion for Fully Funded Public Schools: Eliminate the Gap Elimination Adjustment (GEA), now heading for its fifth year of underfunding schools in order to close state budget gaps. $1.3 billion for the 2014-15 budget would fully fund the Foundation Aid Formula that was enacted in 2007 to equitably and fully fund public schools. The $1.7 billion remainder would make a first payment on delivering the $9.8 billion lost from five years of GEA.

$3 Billion for Statewide Universal Pre-K: The State Education Department (SED) estimates $1.6 billion a year to fund full-day Pre-K for all 4 year olds. Advocates for including 3 year olds cite research showing the superior outcomes. That would roughly double SED's estimate.

$1.5 Billion for Tuition Free NY: Free tuition for public higher education – CUNY, SUNY, and community colleges – would cost $1.5 billion a year.

$5 Billion for Infrastructure: The state comptroller reports an $89 billion shortfall in funding for water, sewer, and transportation infrastructure over the next 20 years. $5 billion a year will close that gap.

$12.5 Billion for Other Progressive Priorities: Many progressive priorities and public jobs could be funded with the remaining $12.5 billion, including the DREAM Act, emergency food programs, environmental protection, and more. A top funding priority for Greens is addressing the climate crisis and the jobs crisis by building a 100% clean energy system by 2030.

These progressive budget numbers are round estimates based on publicly available reports, not a detailed budget. But they are close enough to tell us that New York is not broke and that a progressive alternative to austerity is feasible.

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