Crippling Debt Stifles Economic Growth
New York’s debt burden is out of control. In the next five years, we will borrow approximately $33.4 billion, which is $10.7 billion more than we will pay off during that same span. We are constantly compounding our already-crippling debt problem, and there is seemingly no end in sight. The legislature just agreed on a debt service bill that essentially authorized what amounts to a minimum credit card payment earlier this week; but let’s face it, at this rate, we will never be able to repay our debt.
Even more troubling, New York’s economy has not improved, our tax base has shrunk substantially and wasteful spending continues to bloat our budget. Borrowing money at the same time the economy is shrinking is a recipe for disaster. Annually, New York’s 20 million taxpayers are already on the hook for $2,632 each— money that could be used towards paying down student loan debt, rising food costs and mortgages. We must immediately reverse course before the state falls any deeper into the red.
‘BACKDOOR BORROWING' REMOVES PUBLIC FROM THE PROCESS
According to the state Constitution, government-issued debt is approved through ballot referendum or the budget. This is a logical, sensible way to ensure we don’t borrow more money than we can reasonably afford to pay back. The problem is, each year the governor disregards this common-sense safeguard and issues enormous amounts of debt through public authorities not subject to state Constitution restrictions. And, it’s not just a little extra to fill the gaps; we are talking about billions and billions of dollars.
At present, New Yorkers are on the hook to pay back $52 billion in money that was borrowed without public referendum. Albany is like a teenager making credit card purchases without their parents’ permission. We’ll still be making payments, plus interest, long after Andrew Cuomo has moved out of the Governor’s Mansion. Practices like disingenuous “backdoor borrowing” are precisely how New York accumulated the second worst debt burden in the entire country.
ASSEMBLY MINORITY BILL WOULD COMBAT FISCAL IRRESPONSIBILITY
Taking on debt is never optimal, but when you must do so it needs to be limited to an amount that is affordable. There is a reason for those built-in budget restrictions. In fact, the state Constitution specifically addresses how much money the state can borrow each year.
I am proud to have co-sponsored legislation (A.6844, Oaks) to prohibit the practice of “backdoor borrowing” and limit the amount of revenue debt each fiscal year to 35 percent of the capital budget. It’s easy to spend freely on shiny new toys to impress constituents. Real fiscal responsibility comes from making hard spending cuts and limiting debt to what’s absolutely necessary. With all his talk about closing loopholes, the governor seems to be more interested in bolstering his headline count than protecting the long-term interests of the state.
What do you think? I want to hear from you. Send me your feedback, suggestions and ideas regarding this or any other issue facing New York State. You can always contact my district office at (315) 781-2030 or email me at firstname.lastname@example.org.