Listen to this radio story, featuring Karen Kraut and Ron Deutsch
NEW YORK - Balancing the state budget in New York has been a challenge, as it has for almost every state. Like most others, New York has focused on cutting spending. However, according to a new report, alternatives to those cuts would be a better choice to get states started down the long road to economic recovery.
Ron Deutsch, executive director of New Yorkers for Fiscal Fairness, points out that Wall Street is one sector of New York's economy that has bounced back from the recession and into record profits. To head off painful state budget cuts, which also will send a negative ripple effect through the state's economy, he urges decisionmakers to consider taxing Wall Street's bonuses and excess profits, instead.
"We've spent trillions to shore up the financial sector, and Main Street basically bailed out Wall Street. So, what we're saying is there are a number of different ways Wall Street could help contribute to helping solve our state's budget gap right now."
The report, issued by the United for a Fair Economy Tax Fairness Organizing Collaborative, also suggests tapping into rainy day funds, scrutinizing existing tax breaks and encouraging more federal revenue sharing.
While many would argue against raising taxes in tough economic times, Karen Kraut, director of the Tax Fairness Organizing Collaborative, says the discussion is more complex than that, and legislators need to focus on getting rid of unsound and unfair taxes, too.
"We're also looking at things like closing corporate loopholes and ending tax breaks for businesses that don't produce the jobs that they say they're going to produce."
The report's bottom line is that states do have tools available, other than cutting spending, to balance budgets. It is available online at http://www.faireconomy.org.