Marketplace Scratch Pad

Big states face a backlash

Scott Jagow May 20, 2009

California voters sent a clear message to the state yesterday — get your act together, we’re not bailing you out. In the same vein, New York is about to lose a billionaire’s tax payments. He’s fed up with state government too, and he’s voting with his feet. I mean, his private jet.

In California, voters rejected several ballot initiatives aimed at fixing budget problems:

Proposition 1A, which would have capped spending while extending a sales tax increase and boosting a rainy day fund, was rejected by about two-thirds of the voters who cast ballots.

Sent to a defeat by a slightly smaller majority were measures to provide $9.3 billion in supplemental payments for local school districts and colleges, borrow $5 billion against future lottery revenue and shift revenue earmarked for mental-health and children’s programs to the general fund.

But wait. One proposition did pass. It bars pay increases for state elected officials during budget deficits. Could the message be any clearer???

Gov. Arnold Schwarzenegger said in a statement after the polls closed, “Tonight we have heard from the voters and I respect the will of the people who are frustrated with the dysfunction in our budget system. Now we must move forward from this point to begin to address our fiscal crisis with constructive solutions.”

Schwarzenegger is calling for more cuts in social programs and education. Instead of crying foul, Democrats, who realize the severity of the situation, are saying things like, “We are in dire need of streamlining. I don’t think we can go through this budget and try to offend the least amount of people.”

In New York, meanwhile, billionaire Tom Golisano says he’s making Florida his home for more than six months of the year. I know a lot of people do this to save on taxes, but most of them don’t write a column in the New York Post about it:

By moving to Florida, I can spend that $5 million on worthy causes, like better hospitals, improving education or the Clinton Global Initiative. Or maybe I’ll continue to invest it in fighting the status quo in Albany. One thing’s certain: That money won’t continue to fund Albany’s bloated bureaucracy, corrupt politicians and regular special-interest handouts.

I know a bit about Golisano because I’m originally from Buffalo, NY, where he has a strong presence. He owns the Buffalo Sabres hockey team among other things. And he’s a major philanthropist in the area. I doubt he’s doing this purely to save $5 million. That’s pocket change. Like California voters, he’s fed up and feels the need to send a message. He ends his column this way:

I love New York. But I’m not going to pay any more for the waste, corruption and inefficiency that is New York state government.

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