[NYAPRS Enews] WPost: NY, MD Governors Push Federal Infrastructure Stimulus, Jobs Initiative

[Harvey Rosenthal]

Leading by Example

By David A. Paterson and Martin O'Malley   Washington Post OP Ed  July
31, 2008

 

The Bush administration announced this week that the federal deficit
could reach an unprecedented high, $482 billion, next year, even as all
50 states work to balance their budgets amid an economic recession and a
national mortgage crisis.

 

Citizens in our states and across the country face skyrocketing costs
for food, gas and energy. Sadly, these difficulties are compounded by
wages that have remained stagnant, rising unemployment, a shell-shocked
stock market and a federal government that has failed at almost every
turn to invest in America's shared priorities and future.

 

The challenges to making ends meet are profound. That's why we have come
to our nation's capital today in our capacity as governors to call on
the federal government to help all states navigate an economic crisis
the likes of which we have not witnessed since the Great Depression.

 

New York is dealing with many of the issues other states face in terms
of housing foreclosures, rising unemployment and devalued pensions. But
the declines in the financial sector in particular have deep
repercussions for jobs and tax revenue in New York state. Projections
for this year indicate that capital gains will decline 24 percent and
that financial services bonuses will decline 20 percent. Meanwhile,
financial services firms will be laying off some 35,000 employees in the
state. This is similar to what occurred in the industry after Sept. 11,
2001. But over the nine months after the terrorist attacks, the industry
was able to turn a profit of $6.5 billion. Over the past nine months,
the New York securities industry has reported cumulative losses of more
than $40 billion. This has been devastating to the state's economy.

 

In Maryland, citizens and state leaders came together early to confront
a record $1.7 billion structural deficit. In difficult economic times,
an age-old dilemma arises: Do state leaders abandon their priorities, or
do they make the tough decisions necessary to restore fiscal
responsibility and advance the common good? Maryland has chosen to make
choices -- sometimes very hard decisions -- based on shared values.

 

States are doing their part to build budgets that reflect revenue while
making critical investments.

 

In New York and Maryland, we have made targeted investments in clean,
renewable energy. We have stepped up where the federal government has
fallen down to make critical investments in our infrastructure,
including mass transit and roads. We are also supporting foreclosure
prevention programs and investing in public education so our students
continue to improve and excel, and increasing access to health care for
those who remain uninsured.

Unlike the current administration in Washington, state governments are
choosing to do more with less. In New York, state agencies were asked to
slash their budgets by 3.35 percent in March; this has produced $500
million in savings so far. Just yesterday, agencies were asked to cut an
additional 7 percent, to produce an additional $600 million in savings.
Maryland has made $1.8 billion in cuts and spending reductions and
eliminated more than 700 government jobs; it has also implemented
StateStat, a system of performance measurement to improve government
accountability and efficiency.

 

But no matter how prudent states are, they cannot solve the nation's
economic problems on their own. The federal government must provide
serious leadership and resources and be willing to make difficult short-
and long-term decisions to move our country forward.

 

In the short term, federal officials must pass a second stimulus package
that includes investments in our nation's infrastructure -- projects
that will help us modernize our deteriorating roads, bridges and tunnels
while stimulating our economy through job creation. It is estimated that
for every $1 billion invested in transportation projects, 42,000 jobs
are created, and that every dollar spent on infrastructure projects
generates about $5.70 in economic activity.

Other short-term stimulus investments should include an additional
extension of unemployment insurance and assistance for low-income
Americans -- especially when it comes to helping families afford the
energy it will take to stay warm this winter.

 

In the long term, our federal government should examine its fiscal track
record from the past several years. We can no longer allow irresponsible
spending, chronic underfunding of critical programs and a refusal to
partner with state governments to determine the economic future of our
country. It is time for fiscal responsibility.

 

David A. Paterson is governor of New York. Martin O'Malley is governor
of Maryland. Both are Democrats.

 

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