This is interesting out of the NY Times (hat tip to www.mymanmitt.com):
Rudolph W. Giuliani has been broadcasting radio advertisements in Iowa and other states far from the city he once led stating that as mayor of New York, he “turned a $2.3 billion deficit into a multibillion dollar surplus.”
The assertion, which Mr. Giuliani has repeated on the trail as he has promoted his fiscal conservatism, is somewhat misleading, independent fiscal monitors said. In fact, Mr. Giuliani left his successor, Michael R. Bloomberg, with a bigger deficit than the one Mr. Giuliani had to deal with when he arrived in 1994. And that deficit would have been large even if the city had not been attacked on Sept. 11, 2001.
“He inherited a gap, and he left a gap for his successor,” Ronnie Lowenstein, the director of the city’s Independent Budget Office, a nonpartisan agency that monitors the city budget, said of Mr. Giuliani. “The city was budgeting as though the good times were not going to end, but sooner or later they always do.”
The Giuliani campaign defended the advertisement, noting that it merely states that Mr. Giuliani created a multibillion-dollar surplus, not that he passed one on to his successor.
Mr. Giuliani’s eight years of fiscal stewardship of the city was initially marked by a new brand of conservative budgeting principles in which he cut spending, cut taxes and cut the payroll. Later, when the booming stock market of the late 1990s pumped revenues into the city’s coffers, Mr. Giuliani was able to cut taxes, increase spending above the rate of inflation, and still post big surpluses.
But the economy cooled near the end of Mr. Giuliani’s second term, and he spent most of the roughly $3 billion surplus he had accumulated to balance his final budget, for the fiscal year ending June 30, 2002. Even before the Sept. 11 attacks, Mr. Giuliani projected that his successor would face a $2.8 billion gap the next year. After the attacks, that gap climbed to $4.8 billion in a $42.3 billion budget.
Faced with such a huge deficit, which continued to grow as the economic aftershocks of the attacks continued and the costs of some of the Giuliani administration’s policies came due, the next mayor, Mr. Bloomberg, was forced to take the extraordinary steps of borrowing to pay for operating expenses, cutting programs, and raising property taxes by 18.5 percent to balance the budget.
Rudolph W. Giuliani has been broadcasting radio advertisements in Iowa and other states far from the city he once led stating that as mayor of New York, he “turned a $2.3 billion deficit into a multibillion dollar surplus.”
The assertion, which Mr. Giuliani has repeated on the trail as he has promoted his fiscal conservatism, is somewhat misleading, independent fiscal monitors said. In fact, Mr. Giuliani left his successor, Michael R. Bloomberg, with a bigger deficit than the one Mr. Giuliani had to deal with when he arrived in 1994. And that deficit would have been large even if the city had not been attacked on Sept. 11, 2001.
“He inherited a gap, and he left a gap for his successor,” Ronnie Lowenstein, the director of the city’s Independent Budget Office, a nonpartisan agency that monitors the city budget, said of Mr. Giuliani. “The city was budgeting as though the good times were not going to end, but sooner or later they always do.”
The Giuliani campaign defended the advertisement, noting that it merely states that Mr. Giuliani created a multibillion-dollar surplus, not that he passed one on to his successor.
Mr. Giuliani’s eight years of fiscal stewardship of the city was initially marked by a new brand of conservative budgeting principles in which he cut spending, cut taxes and cut the payroll. Later, when the booming stock market of the late 1990s pumped revenues into the city’s coffers, Mr. Giuliani was able to cut taxes, increase spending above the rate of inflation, and still post big surpluses.
But the economy cooled near the end of Mr. Giuliani’s second term, and he spent most of the roughly $3 billion surplus he had accumulated to balance his final budget, for the fiscal year ending June 30, 2002. Even before the Sept. 11 attacks, Mr. Giuliani projected that his successor would face a $2.8 billion gap the next year. After the attacks, that gap climbed to $4.8 billion in a $42.3 billion budget.
Faced with such a huge deficit, which continued to grow as the economic aftershocks of the attacks continued and the costs of some of the Giuliani administration’s policies came due, the next mayor, Mr. Bloomberg, was forced to take the extraordinary steps of borrowing to pay for operating expenses, cutting programs, and raising property taxes by 18.5 percent to balance the budget.
posted by James Phillips | 11:37 AM
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