An agenda for New York State 2002
In 2002, New York must keep rolling. Keep working on the basics. Keep thinking about the future.
Hard times bring out the best in people. And since September 11, 2001, New Yorkers have shown the world what we’re made of. We’ve stood tall, and stood together. We’ve helped the victims, honored our heroes, and dug in for the rebuilding.
A terror attack — and now a recession. We’re down. But not out.
What do we need to do in 2002? Keep rolling. Keep working to rebuild. And keep working to forge a strong economy that will provide jobs and prosperity for New Yorkers in the years to come.
We can emerge from these troubles stronger than ever before. For the underlying reality is: New York is stronger than ever before. Before 9/11 our state’s economy was entering the current national recession in far better shape than in the last recession, in 1990. We’re not going to let terrorists deflect us from securing New York State’s comeback.
For The Business Council — which represents businesses large and small, in every sector of our economy and in every part of New York, upstate and down — our highest priority in 2002 is to support New York City’s effort to recover and rebuild. New York and the nation must put lower Manhattan back in business, with a 21st Century infrastructure, a strong financial services community, and vibrant small businesses. The planning is now under way; let’s keep rolling.
“Keep rolling” also means New York must preserve the public policy changes — such as tax cuts and regulatory reform — that have done so much to get our economy moving over the last eight years. In the last recession, New York raised taxes and delayed tax cuts, thereby prolonging the downturn. We’re not going to make the same mistake again.
And “keep rolling” means we can, and must, take bold new steps to invigorate our private sector, to ensure that we capture the investment and growth that will follow the nation’s recovery from recession, and to build the economy our children and grandchildren deserve. That means we’ll keep working on the basics — cutting back New York’s competitive disadvantages. And it means we’ll keep thinking about the future — building the knowledge-based, high-tech advantages that will produce the prosperity of tomorrow.
Keep working on the basics
We must make our costs competitive, so we can capture the investment and growth that will follow the recession.
New York State has made a spectacular economic turnaround over the last eight years. Consider the difference between this recession, and the last one. Last time around New York entered the recession before the nation, and kept losing jobs for two full years after the recession was over. But since then we’ve gained over 900,000 jobs. And for much of 2000 and 2001 our job growth rate outstripped the nation’s. That’s what you call a comeback!
How did we do it? The old-fashioned way: by cutting the cost of doing business in New York and making this state more competitive. We cut taxes, cut red tape, cut workers’ comp costs, cut unemployment insurance costs. All that, and more.
The new recession makes it more urgent, rather than less, that New York State keep working on these basics. Because competitive costs will be a key factor when businesses decide where, and how much, to invest in new growth once the recovery comes. New York still has plenty of room to improve its competitive standing.
The Business Council’s key priorities in this area for 2002 include:
- Further state tax reform that will attract investment and jobs as the recovery begins. For example, single-sales factor corporate taxation, and repeal of the alternative minimum tax for corporations, could be key incentives for investments in New York by the manufacturing and financial services sectors alike. Similarly, further estate tax reform may be needed to keep New York attractive to entrepreneurs.
- Site a reliable surplus of electric generating capacity, to ensure that New York has the power to grow, and to create the competition that will bring down costs. Commercial power rates in New York are 36 percent above the national average; that’s a disadvantage we don’t need.
- Reduce state mandates that drive up the cost of local government, so localities can cut property taxes. At 58 percent above the national average per capita, property taxes are New York’s largest remaining competitive disadvantage.
- Help employers reduce the cost of providing jobs, by working to constrain the cost of workers’ comp and health insurance, and by adopting liability reform. It is particularly urgent that we impose some reasonable cap on workers’ comp benefits for partial disabilities, and adopt objective medical guidelines for assessing specific injuries.
Keep thinking about the future
We must stay ahead of the curve in educating our children, and in building our high-tech edge.
New York’s future is going to be built on a knowledge-based, high-tech economy. Merely providing ever more lower-wage jobs in, say, hospitals, or the public sector, will not give us the economic base to ensure that coming generations of New Yorkers lead a prosperous life.
A world-class lifestyle requires world-class skills and world-class employers, in a dynamic and friendly business environment. It’s just that simple.
How do we get to that future? We New Yorkers already know how. Historically, the Empire State’s strength has been based on a highly educated workforce, leading-edge technologies, and entrepreneurial leadership.
Those are tremendous advantages. But we can’t take them for granted. Because the world is changing fast. In the Information Age somebody, someplace else, can learn your skill, copy your technology, do it cheaper. The only way to stay ahead is to...stay ahead!
To be ready for the future we must:
- Educate all our children to world-class levels. No exceptions. No excuses.
We fully support the Board of Regents’ insistence on higher standards; the measurements needed to gauge our progress; and the resources, tools and accountability our schools need to do the job.
- Encourage innovation and research, and make the most of our superb system of higher education, public and private.
Now is the time for New York to make a sustained, multi-year commitment to helping our research universities advance the technological breakthroughs that will sustain our economic growth in the decades ahead.
Yes, 2002 will be a year of great challenges. But those challenges contain opportunities. Because they force us to think about what’s important. Not about what we’d like to do, but about what we must do: Keep rolling. Keep working on the basics. And keep thinking about the future.