Tax And Spend Tipping Point?

There have been a number of articles, essays, and reports in the news lately, which have me wondering if we are nearing "armageddon" with regard to taxation and government spending.

Today's Democrat & Chronicle had a headline regarding Gov. Paterson's musings about curtailing the S.T.A.R. tax relief program as part of his efforts to cut State spending. Yesterday, the D&C carried a guest essay by GOP Chairman Steve Minarik who wrote that community leaders need to recognize that their requests for State and Federal dollars for local projects are inconsistent with their calls for reduced taxation and government spending.

The D&C has also been in the forefront of the movement to consolidate (or eliminate) local government programs. Meanwhile, the Governor's Commission on Local Government Consolidation is due out next month.

We all understand that we are heavily taxed in New York. I have previously argued that the real problem is State spending, not local government costs. I still believe that, but it is increasingly clear to me that we are on a collision course with a fiscal disaster if we do not begin to rein in spending at all levels.

How can this be done? I don't claim to have any specific answers, except that we (meaning taxpayer/voters) need to start paying attention and asking serious questions. We also need some leaders who are unafraid to point out that there is no "free lunch". If we really want government spending to slow (or, dare I say it, go down) we, as consumers of government services need to reduce our demands on government.

We need politicians, community leaders, the media, and the public, to take a close look at what government spends our money on. I think its fair to say we cannot afford everything we are "buying" right now, since so many levels of government are relying on "deficit spending". But we can't just blame our leaders. They are just giving us what we are demanding. We need to re-set priorities and rethink what is appropriate to expect government to do.

It is easy to blame these problems on straw men like "unfunded mandates". It is true that unfunded mandates shift burdens from the State to local government. But does it really matter to us out of which pocket or to what government we pay taxes? The questions are: Do we want the services provided by the "unfunded mandates"? Are those "mandated" expenditures vital? If the answers are yes, then we have to agree to pay for them.

Similarly, the S.T.A.R. program is the flip side of unfunded mandates. S.T.A.R. is an unreimbursed State credit against a local government expenditure. Is there any real reason that the State should give local property tax credits to us regarding our local school tax bills? Where does that money come from? And, what has been the result? Despite S.T.A.R., and record amounts of State aid to schools, school spending has risen well above inflation during the time S.T.A.R. has been in place. Yet, I haven't heard any taxpayer calls to end that program.

It appears that we are reaching the end of our ability to pay for all of the government we have. Sadly, I believe that this inability to afford government will lead us to give up our local governments for consolidated "metro" government, without realizing that those local governments are actually more efficient and responsive to our needs. Instead, we will lose local control and direct service to distant and unresponsive entities. The crisis may be put off, but it won't be solved.

Our only hope is to quickly start to demand real reform in Albany. The "three men in a room" approach has led us to our current crisis. I hope it is not too late, and that we are not too complacent, to save ourselves.