Governor Paterson has delivered another dire assessment of the state's finances. Speaking at event in New York City, Paterson told the Wall Street crowd that if drastic measures aren't taken, New York's general fund will be in the red by the end of the month. Our Josh Robin attended the Governor's address and has more.
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NEW YORK, N.Y. -- It's not just yuletide on Wall Street. Bonus season is also in the air and Governor Paterson says it's okay to get a really big gift.
"In New York, Wall Street is Main Street," Paterson said.
But it's not in much of the country or even the world, which is seething over record bonuses and the lingering meltdown. Wednesday, Great Britain's treasury chief even announced a onetime 50 percent tax on bonuses. Before an enthusiastic crowd, the Democrat did rue abuses and errors, but says rage is misplaced in a state where a fifth of revenues come from financial services.
"You say anything about corn in Iowa, they'll run you out of town. You say anything about oil in Texas, they'll string you up near the nearest, we need to stand behind the engine of our economy in New York and that engine of our economy is Wall Street," Paterson said.
In Albany, the engine of agreement is sputtering. Paterson says the state could run out of cash at the end of the month because the legislature hasn't cut enough. Inviting lawsuits, he plans to unilaterally withhold half a billion dollars in aid to such sectors as health care and education, which he later called sacred cows protected by special interests.
Of course, there was a political angle to the speech as well. Paterson's potential rival next year, Attorney General Andrew Cuomo, has made headlines by going after financial malfeasance.
Paterson also tacitly acknowledged the difficulty in fundraising with those special interests on the chopping block. They could be replaced by others with money, receptive to the speech.
"It's very easy to blame Wall Street," said Kathryn Wylde, Partnership for NYC President and CEO. "It's was very glad the governor stood up for us today."
Others questioned the benefits of big bonuses for ordinary New Yorkers.
Paterson, meanwhile, is slated in coming days to detail exactly where the half a billion dollars in cuts will be made.