Commentary

Pataki: The Fall of a ‘Rising Star’

By Stephen Slivinski
This article appeared in the New York Post on October 25, 2006.

It’s hard to recall there was ever a time when fiscal conservatives nationwide saw New York’s Gov. Pataki as a rising political star. Elected on a promise to cut taxes, Pataki delivered early in his first term, slicing the top state income-tax rate by 25 percent and reducing the capital gains and inheritance taxes, too. He even succeeded in cutting government spending.

But soon Pataki was raising taxes and hiking spending at rates that would make Nelson Rockefeller and Mario Cuomo smile. The same conservatives who had earlier cheered him were left scratching their heads, wondering: What happened to George?

The schizophrenic nature of Pataki’s tenure is reflected in the grades he received in the Cato Institute’s biennial “report card” on the nation’s governors. This index of fiscal restraint uses 23 objective measures of fiscal performance to rank each governor - allowing us to see who’s a fiscal conservative and who’s a tax-and-spender.

The formula for success is simple: If you cut taxes and spending, you’ll get a high grade. Raise them, and you’ll get a low grade. In his first two years in office, Pataki racked up a well-deserved A, the highest grade of all the Republican governors elected in 1994.

Starting with his second term, however, Pataki’s fiscal schizophrenia began to set in. (Is there something in the water in Albany?) Pataki proposed all sorts of awful policies, such as a multibillion-dollar bond initiative for roads and pork-barrel environmental projects. He hiked cigarette taxes and proposed over $3 billion in overall tax increases by 2005. The state budget exploded, too, growing by 76 percent since his first day in office - almost twice the growth of population plus inflation.

This year, Pataki has tried to convince people that the tax-cutter they knew and loved was back by proposing income-tax-rate cuts for the first time in almost a decade. These are much-needed cuts - but most of them wouldn’t have even kicked in until after he’d left office, leaving them a sitting duck for the next governor who may not be interested in cutting income taxes. In light of the revenue increases Pataki presided over, these new cuts were simply too little, too late.

And those pathetic tax cuts are the good news. On the spending side, Pataki remained a lover of big government. His fiscal 2007 budget proposal expanded state government spending by 7 percent, the biggest proposed increase since 1995.

The result of all this? Pataki’s fiscal grade for his final term in office plummeted to a D - one of the biggest grade drops in the Cato report card’s history. He leaves office with an overall end-of-tenure grade of C. And he leaves New Yorkers with a tax burden barely budged from where it was when they elected him, and a state budget bigger than ever.

Perhaps Pataki’s recent tax-cut proposals were simply an attempt to end his mostly disappointing governorship on a high note. Or, with his presidential aspirations altogether apparent, maybe it was simply a bid to convince the small-government advocates who vote in GOP primaries that he’s still one of them. Yet, after the fiscal horrors of the presidency of George W. Bush, it’ll be hard for Pataki to convince supporters of small government to support a New York governor who spends like a 1970s Republican named Nelson Rockefeller.

Stephen Slivinski is director of budget studies and author of the “Fiscal Policy Report Card on America’s Governors: 2006.”