Gov. Cuomo becomes “Wall Street’s newest hero” by passing a budget that favors tax cuts for the corporate and wealthy elite over funding for the state’s schools.
After pushing for tax breaks for the state’s wealthiest residents and bailing out Wall Street once again, while simultaneously cutting social programs and de-funding the state’s education system, New York’s Democratic Gov. Andrew Cuomo has earned the title “Wall Street’s newest hero.”
Cuomo earned this and other nicknames such as “Cuomocchio” after he presented his pro-corporate America budget proposal for the 2014-15 fiscal year in January. The proposal included tax cuts for the financial and corporate elite, while slashing the amount of money allotted to the state’s public education system as well as social programs.
The final $138 billion budget for the 2014-15 fiscal year was negotiated behind closed doors between the governor and leaders of the Republican-controlled state Senate and Democratic-controlled Assembly. The announcement that a final budget had been agreed upon came late on Friday, and the budget was passed by the state’s House and Senate on Monday — hours before the Tuesday deadline.
The lawmakers may have met their deadline, but due to the timing of the bill and the fact that it wasn’t released publicly until Sunday, the public wasn’t given time to review and react to the budget. However, both Democrats and Republicans have praised the budget bill, prompting some to wonder if the differences between economic commitments and social policy ideals between the two major parties are rapidly evaporating due to financial pressures.
New York state already has the highest level of income inequality in the United States, which is why groups representing the state’s so-called “99 percent,” such as Citizen Action of New York and We Want a New York for #AllOfUs, have started demanding that lawmakers in Albany stop working solely for the “1 percent” — the wealthy and the well-connected.
The groups came together on Monday to protest the budget bill, arguing that New York is a community and that “we don’t need another ‘wall street hero’ but a government for all of us.”
“My biggest disappointment is that Governor Cuomo and Senate co-leader Jeff Klein broke their promises to pass comprehensive public funding of elections to reduce the influence of big money in Albany,” said Karen Scharff, executive director of Citizen Action of New York.
“Despite the increased school aid, schools across the state are still severely underfunded. While we were able to beat back some of the worst tax breaks for the super-rich, Cuomo’s bailout for Wall Street banks – which will cost New Yorkers over $300 million a year – made it through, as did other tax breaks for the wealthy.”
Tax breaks and education cuts
Under the new budget deal, the state’s corporate income tax rate will decrease from 7.1 to 6.5 percent, which is the lowest it has been since 1968. The banking industry also received some generous tax cuts, and income taxes on manufacturers dropped from 5.9 percent to zero. Exemptions for estate taxes also increased to $2.06 million from $1 million last year, and are expected to increase to $5.25 million by 2017.
Homeowners throughout the state were promised modest tax rebates, as well, if — and only if — local governments pledged to not raise taxes by more than 2 percent or to the rate of inflation, which some are calling a bribe meant to force local communities to consolidate the services they offer. In order to comply, cities will have to reduce their budgets by about 1 percent so the average homeowner can save around $178 per year.
While the budget did include some positive items such as funds for a universal pre-kindergarten program, the tax cuts and corporate benefits in the budget were only made possible by chipping away at funding for education and social programs such as public school funding.
In regards to school funding, the budget deal put a financial chokehold on public schools. Cuomo may be a staunch advocate of the school privatization movement, but since not all New Yorkers agree, Cuomo has decided to make it almost financially impossible for public schools to survive.
According to Diane Ravitch, a research professor of education at New York University and author of “Reign of Error,” the budget deal forces the privatization of schools on New Yorkers by allowing private corporations to never have to pay to use public space if they manage a charter school and authorizes bonuses of $20,000 for “highly effective” teachers.
Going back to the free-rent clause is particularly interesting, since Ravitch said if the space happens to be in a location where a public school is already located, the charter school can essentially evict the public school students. Even worse, New York City Mayor Bill de Blasio — a progressive Democrat who has advocated for higher taxes on the wealthy to fund public education programs — can’t do anything about it.
If a charter school opts to pay for space, such as renting private space instead of city- or state-owned space, New York City public schools will be forced to pay rent. But it’s not known how the public school system will be able to pay that bill, which is why Ravitch said parents and educators should expect increased class sizes, lay-offs among social workers, counselors and psychologists, and more cuts to arts programs in schools.
“The bottom line is that when billionaires talk, the New York legislature and Governor Cuomo listen. Actually, they sit up, bark, and roll over,” Ravitch said.
She also explained that many lawmakers believe charter school students get higher test scores, and therefore, they deserve more privileges. In fact, charter school students, at least in New York, had test results comparable to their public school peers in 2013.
If the Occupy Wall Street movement phenomenon taught us anything it is that New York is not alone in its lawmakers catering to the wealthy elite. This country is owned and ruled by the 1 percent and the only thing that can stop this political favoritism is the election of lawmakers who truly work for everybody.
What’s so troubling about this particular fight against the 1 percent in New York is Cuomo’s blatant disregard for not only what the people want — a livable minimum wage, quality education for all and a ban on fracking, among other expectations — but his continued attempts to please those who made his campaign financially possible, over the needs of New Yorkers.