Religious Services

Cuomo said his opposition was a principled one, similar to his father Mario’s unwillingness to go along with the death penalty, a policy deeply rooted in the elder Cuomo’s Catholic faith.

“My father was governor of this state. He was against the death penalty. Everyone in the state wanted the death penalty — everyone. It was near 80 percent. And he was the governor of the state and he said he wasn’t going to sign it. Every year — go back and talk to some of the people who know the history — every year we had to scramble and make sure there wasn’t an override of the veto.
(snip)

“The point is, we don’t elect — the governor isn’t a big poll taking machine. And that’s what we do, we take a poll and do whatever the poll says and you wouldn’t need me … so the fact that everyone wants it, that doesn’t mean all that much. I respect the people, their opinion matters, but I’m not going to go back and forth with the political winds.”

A tax on those making $250,000 and more will expire at the end of this year. Cuomo disputed the idea that this is essentially a tax break for those earners.

New York’s surcharge was introduced in 2009 as a three-year emergency measure. The law raised the top personal income tax rate on New Yorkers making more than $200,000 a year by one percentage point to 7.85 per cent, while those making more than $500,000 saw their top tax rate go up 2.1 percentage points to 8.97 per cent.

Over the three years the law has been in place, it has generated $13.8bn in revenue, according to the state’s budget estimate.

Andrew Cuomo, governor, opposed renewing the measure. New York’s legislature passed a budget in April that cut spending by almost $10bn without raising new taxes or extending the surcharge. That means the top tax rates for all incomes more than $200,000 will reset to 6.85 per cent, the same rate for those making more than $20,000 a year.

Advocates of the surcharge argue that the additional revenue it raises is necessary to offset the cuts the state has made to close its budget gap. Next year’s deficit is estimated at $2.5bn.

“Some of that $5bn you would get if you extended the tax would significantly moderate further cuts in the budget and would allow some restoration of past cuts or make resources available for job creation investments and infrastructure,” said James Parrott, chief economist of the Fiscal Policy Institute.

Kathryn Wylde, president of the Partnership for New York City, a business advocacy group, countered that the revenue raised from such surcharges was not enough to solve the structural budget deficits facing state and local governments.

“It might numb the pain temporarily but that might be another reason for the politicians to kick the can down the road,” she said. “It won’t solve the fiscal problem the state faces and is liable to exacerbate it because people, even in that income category, feel very uncertain about their own future.”

Income inequality – a core theme of the Occupy Wall Street movement – is higher in New York than any other major US city, with the top 1 per cent earning 44 per cent of total income in 2007, compared with 23.5 per cent nationally.

That had fuelled public anger, said Mr Parrott. “It’s clear that the concentration of income has translated into political power. People are seeing that and reacting to that,” he added.

The NYT reports that the White House and the NY Fed are pressuring NYS Attorney General Eric T. Schneiderman.

Given the sadly misguided history of both the Obama administration and the NY Fed (led by the President Tim Geithneir, now Treasury Secretary) when it comes to Bailouts, this is not a huge surprise.

But what is surprising is the utterly inappropriate behavior of Kathryn S. Wylde. She is not only a member of the board of the Federal Reserve Bank of New York, but occupies the seat supposedly reserved for the representing the public.

If the Times report is accurate, and the quote below represents Ms. Wylde’s comments, than that position is a laughable mockery, and Ms. Wylde should resign effective immediately.

The quote in question, which was reported to have occurred at Governor Hugh Carey’s funeral (!?!) was as follows:

“It is of concern to the industry that instead of trying to facilitate resolving these issues, you seem to be throwing a wrench into it. Wall Street is our Main Street — love ’em or hate ’em. They are important and we have to make sure we are doing everything we can to support them unless they are doing something indefensible.”

I do not know if Ms. Wylde understands what her proper role should be, but clearly she is somewhat confused. She appears to be far more interested in representing the banks than the public.