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For Release — August 30, 2001

FORMER GOV. HUGH L. CAREY CALLS FOR
SPENDING RESTRAINT IN STATE BUDGET

ALBANY—In radio announcements sponsored by The Business Council, former Governor Hugh L. Carey is urging the Legislature to practice fiscal restraint as it seeks to finalize the state budget for the current fiscal year.

Excess spending, Gov. Carey warns, "could bring us right back to the big deficits of the past."

"George Pataki is saying 'no' — to be careful," Governor Carey says. "And he's right."

The paid radio announcements began airing in the Albany area this morning. They have been prepared for possible statewide use, depending in part upon the pace of progress in the budget negotiations.

Governor Carey took office in 1975 and immediately confronted several fiscal crises involving first the state government's borrowing authorities, and then New York City's brush with insolvency. His comments on the current budget process in Albany draw lessons from his experience in resolving those crises.

"When I became Governor 26 years ago, New York State was on its knees — and New York City was flat broke and deep in debt. New York State had spent far beyond its means. And it took real cooperation between the Governor and the Legislature to put our house in order. We had to make tough choices, but we got the job done.

"Today in Albany, the Legislature is ready to add more money to the largest state budget in history. And that would be understandable — if it were affordable. But it is not.

"George Pataki is saying 'no' — to be careful. And he's right. What if the economy slows down? What if the surplus shrinks? In just a year or two, the 'what if's' and all the extra spending could bring us right back to the big deficits of the past.

"Don't let history repeat itself, New York. It's your money — your tax dollars. So let your voice be heard. We can't afford to spend away New York State's future."

For some months The Business Council, New York's largest broad-based employer organization, has been urging fiscal restraint on the Legislature. It has sought to counter the pressures lawmakers are under to spend most or all of the budget surplus, even in the face of growing concerns about the state's economy and its revenue base.

Governor Carey has publicly expressed similar concerns. So Business Council President Daniel B. Walsh asked the former Governor if he would be willing to have The Business Council sponsor announcements through which he could amplify his message. Governor Carey readily agreed, and taped the 60-second announcement on Monday, August 27, in New York City.

Five months into the 2001-02 state fiscal year, lawmakers and Governor Pataki have yet to finalize a new state budget. A limited, "baseline" budget was adopted on August 3, but negotiations on supplements to it are reported to have made little progress. Some initial proposals in the Legislature would have added as much as $2 billion to the budget proposed by Governor Pataki.

"We recognize that the Legislature must make some prudent additions to its baseline budget for education, research, human needs and tax reforms," said Walsh. "But the key word is 'prudent.' It would be a mistake to make major, ongoing spending commitments that can't be kept if the economy slows and revenues soften."

"The business community is grateful to former Governor Carey for his willingness to sound a note of caution in this manner," Walsh said. "He has unmatched credibility on fiscal prudence."

The radio announcements were prepared and placed by the Albany office of Eric Mower and Associates. Funding for the initial placements is coming from the dues support of The Business Council's some 3,500 member companies.