Wall Street had a party in the 90’s and we weren’t invited. Now that the party is over it isn’t right to ask our children to clean it up.

Governor Paterson is confronted with a $15 billion deficit and is talking about shared sacrifice. He is asking us to tighten our belts, proposing $2.5 billion in cuts from our children’s classrooms (on top of reneging on a court ordered increase of $1.9 billion in education funding the Governor is proposing and additional $700 million in education cuts).

But not everybody will feel the burden of these budget cuts in the same way. The cuts will have a disproportionate impact on upstate residents with low incomes and people of color. But aside from a symbolic gesture of taxing things like furs and jets, the Governor is not proposing that the wealthiest New Yorkers step up to pay their fair share.

Over the past twenty five years the wealthiest New Yorkers have enjoyed the lion’s share of tax cuts and have seen their incomes rise precipitously while the rest of us are barely hanging on. The current top income tax rate has fallen so low that whether you are a millionaire or are someone earning $40,000 you are paying the same tax rate (6.85%). In fact New York’s top income tax rate is lower than our neighboring states (Vermont and New Jersey).

Although it is frequently claimed that New York has the highest taxes, that is not the case- a dozen states have higher income taxes than New York. What is true is that New York has high property tax rates. However, that’s because the legislature has been shifting the tax burden off of businesses and the wealthy (cutting their tax rates in half) and shifting the burden onto our property taxes!

By increasing the income tax on New Yorkers earning over $250,000 the state could collect up to $5 billion in revenue, reducing the pressure to cut funding for our children’s education.

Will millionaires flee New York if they are asked to pay their fair share? They didn’t in 2003 when the NYS legislature passed a temporary income tax surcharge and they didn’t flee from New Jersey when New Jersey increased its top income tax rate. Wealthy people stay in New York because the state has so much to offer.

With upstate residents acutely feeling the sting of the national recession now is precisely the wrong time to cut programs that enable middle class New Yorkers and New Yorkers with low incomes to keep their heads above water. In order to stimulate the economy we need to invest in our people and keep dollars circulating. That’s what President-elect Obama’s Budget Director Peter Orszag and Nobel Prize winning economist Joseph Stiglitz say, “Tax increases on higher income families are the least damaging mechanism for closing state fiscal deficits in the short run… Reductions in government spending on goods and services, or reductions in transfer payments to lower-income families are likely to be more damaging to the economy in the short run.” In fact over 100 economists have signed a letter to that effect and sent it to the Governor.

Poll after poll shows that New Yorkers support requiring the wealthiest New Yorkers to pay their fair share. New Yorkers overwhelming voted for a fair and just economy last month and during the campaign President-elect Obama continually talked about the need to have the wealthiest Americans pay their fair share. New York shouldn’t be any different.

We call on our local Assemblymembers and Senators to do what they had the courage to do in 2003, and require the wealthiest New Yorkers to step up to pay their fair share. New Yorkers earning over $250,000 should kick back a portion of the enormous income tax windfall they have enjoyed over the past eight years. This is not the time to ask our children to clean up Wall Street’s mess.

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