After years of hearing that we must tax the rich (anyone making over $150,000/year), it seems that the Democrats’ fascination with class warfare has come full circle in the State of New York. High paying jobs in New York’s financial district are continuing to disappear.
Governor Paterson has stated that the brokerage and investment community represents one fifth of all of the state’s tax revenues. The loss of jobs and planned reduction in bonuses is putting the state in its worst financial crisis since the Great Depression, at least according to Paterson. The state faces mounting deficits in its budget, and he says the only way out of this is to cut spending.
Apparently the state wasn’t satisfied with 20% of its revenue stream from the brokers, so disgraced former Governor Eliot Spitzer, in his role as Attorney General, went after the investment bankers for alleged “stock price inflation”, among other misdeeds. Spitzer also went after the former chairman of the New York Stock Exchange, Richard Grasso, claiming he failed to fully inform the board of directors about his $140 million deferred compensation package, a case which Grasso recently won. Just keep pounding away at the so-called “rich”. As they now understand, putting a large chunk of your tax revenues at risk by relying on high income individuals and corporations to provide that revenue stream, isn’t such a good idea. And this is a state and city with very high tax rates on top of it.
Governor Paterson is scheduled to address the Democrat convention next week. I wonder if he will tell them that the answer to falling state tax revenues is to cut spending, and not to raise taxes? Don’t hold your breath waiting for that speech.