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Getting a Grip

State of Stupidity

Fixing New York’s Finances

For most of my life it’s felt as if all branches of government have been held hostage by the chronically unimaginative. Take the current New York State budget crisis, for example. We’re spiraling toward bankruptcy because 20 percent of state revenue derives from Wall Street—and that money just plain ain’t there anymore. It’s yet another d’uh moment.

Wall Street is a casino. It always has been. In the long run, it’s usually been a dependable conduit for transferring wealth from poor workers around the globe to wealthier investors—with New York State eventually getting a sliver of the booty. When the Wall Street slot machines are delivering, we spend like lottery winners, dolling out tax rebates, and so on, as if this were a sustainable source of revenue. There’s no thought of banking a surplus for a rainy day. Weirdly enough, politicians passed off this notion of spending every penny in our piggy bank as “conservative.”

Like deer

In reality, spending all we have and saving nothing is the antithesis of conservative financial management—even if the drunken sailors who run the state scream that “it’s the people’s money and big government has no right to hold on to it.” So when times are good we write fat checks to everyone; folks like their “STAR” tax rebates. And when times turn bad, as they inevitably do, we act like deer grazing in traffic, dumbfounded and without a plan.

At this point the deer are running directly at speeding cars. Here in New York, we, exercising similar intellectual prowess, slash and burn the education, health, and infrastructure programs that sustain us. We’re talking about cutting meat from the skeleton of a state university system that is still decimated from cuts it suffered in the 1970s, and we’re going to take money away from urban school districts that are already suffering from overcrowded classrooms, uncompetitive salaries and a lack of technology. And we’re going to cut Medicaid funding to nursing homes, as if we have no better plan for balancing our state budget than taking the sugar out of old folks’ porridge.

We can’t go back in time and tell the wise ones that the stock market won’t magically balance our budget forever. So let’s work with what we have. But let’s be creative. Where is there a pit of money in New York State that is poorly spent?

Rockefeller’s legacy expenses

We don’t have to look too far. In 1973 New York embarked on a failed social experiment under then Governor Nelson Rockefeller, instituting the nation’s most draconian anti-drug laws—laws that, for example, mandated the same sentence for a marijuana dealer as for a murderer. The state eased these laws in 2004 under pressure from both fiscal conservatives and social liberals, but the so-called reforms left most of the original laws intact, while lowering some mandatory drug sentences from being equivalent to murder to being equivalent to rape. Hence, as of 2008, approximately 14,000 people are locked away in New York prisons on drug offenses. They comprise 38 percent of the prison population and cost the state over a half billion dollars per year to jail. As a reference point, this is over five times the size of the proposed budget cuts that threaten to severely impact the quality of education in the SUNY system.

Cutting prison spending, even if all criminal activity suddenly ceased, is all but impossible in New York State. New York’s prison-industrial complex is sacred to the big government, tax-and-spend Republicans in the New York legislature. Since the enactment of the Rockefeller drug laws, the prison industry has emerged as rural New York’s largest growth industry and the economic anchor for impoverished upstate counties decimated by Reagan-era economic policies.

Dependent on crime

These rural—and faithfully Republican—counties are economically dependent on the persistence of crime in New York City. Former Big Apple residents make up most of the prisoners housed in state prisons while rural Republicans make up the bulk of their handlers; the Census now counts prisoners as residents of rural prison counties and henc, the state and federal governments allot anti-poverty funds to those counties based on this population, and legislative districts are swelled by this population even though they can’t vote. If crime goes down in New York, prison populations shrink, theoretically followed by job losses and a diminished tax base in Republican counties.

I use the work “theoretically,” because this is not the case. The first part of this scenario actually happened. Crime in New York dropped by 75 percent from the mid 1990s to the mid 2000s. That, along with minor changes in the Rockefeller drug laws, has so far resulted in 9,000 or so few inmates in New York’s jails—that’s roughly a 12 percent drop.

But don’t expect to see a corresponding drop in prison funding. It’s just not easy to close jails, even if we don’t need them. The state legislature, for example, passed a law in 2006 requiring a one-year notice to employees before closing any state prisons. This was a response to former Governor Pataki’s plans to close four upstate prisons in order to save $70 million per year. Governor Paterson, under pressure from New York Senate Republicans, axed that plan, opting to continue wasting $70 million per year on prisons that are unneeded, even with today’s drug-law swelled prison population.

Cashing in on racism

Now the Rockefeller drug laws begin to make sense. The same legislators whose impoverished districts rely on prisons for jobs also rely on prisoners for prisons. Draconian drug laws mean more prisoners, and hence more justification to keep prisons open, even if New Yorkers continue their nasty aversion to crime. It also makes sense that cuts to education, which traditionally translate into more criminality (roughly 80 percent of America’s prisoners never finished high school), are good for the local economy—though I don’t really think many legislators are savvy enough to understand concepts of causality. But we often find that prison district legislators oppose social spending, labeling it as “big government,” while supporting big government prison projects.

Now let’s add race to the equation. Back in 2000, I wrote: “Consider these numbers: According to the Substance Abuse and Mental Health Services Administration, African Americans make up 13 percent of illicit drug users in the United States. However, according to the Sentencing Project, a policy research institute funded in part by the Department of Justice, African Americans constitute 35 percent of all arrests for drug possession, 55 percent of all drug possession convictions, and a whopping 74 percent of people sentenced to jail for drug possession. White people, by comparison, make up 74 percent of illicit drug users but roughly account for only one fifth of those serving jail time for drug possession. Put simply, this means that if a white man in Amherst and a black man in Buffalo both personally consume illicit drugs, the black man is over 20 times more likely to wind up in jail.”

Looking at the situation though this lens, the prison-industrial complex becomes horribly uglier. In New York, our whitest counties anchor their economies on the business of caging black men. The politically untouchable remnants of the Rockefeller drug laws provide the judicial framework for this racist economy.

Eighteen to life

Then there are the “three strikes” laws that were enacted with the support of prison county legislators. These laws also remove judicial discretion and mandate minimum prison terms for repeat offenders. One of them is Mitchell Montgomery of Buffalo, who was sentenced to 18 years to life for jumping through an open window and stealing a camera from the empty apartment of a UB student. It was his third such felony—all burglaries involving open doors or windows. He was injured during the arrest, and, as is the case with many people injured while being arrested in Buffalo, a brutality complaint was headed off by a felony assault charge—hence the three-time violent felon. Mandatory sentencing laws supported by the prison-industrial complex stripped the preceding judge’s discretionary sentencing powers.

I first encountered Mitchell in 2000 when two students in my investigative reporting class wrote about his case. He’s still behind bars and won’t be eligible for release until 2015 at the earliest. The severity of his sentence mandates that he serve out his time in a maximum security facility (my students interviewed him when he was in Attica), even though he has no history of violence, save for the resisting arrest charge. It costs the state as much to incarcerate Mitchell in such a facility as it would to hire a teacher. Yes, Mitchell is a convicted burglar (though, for the record, he still proclaims his innocence). But 18 to life for stealing a camera?

This sentence might not sound fair, but it’s good for business—the prison business—as are draconian drug laws. People have argued against these laws on moral grounds, but have not made much headway. Perhaps, with the current governor asking us to make great sacrifices to balance our crisis budget while keeping this status quo intact, people will finally challenge these laws as being just too damn pricey.

money, which is one reason why true fiscal conservatives often oppose them.


Reader Comments


Galaxia
30 Nov 2008, 19:59
Nicely put, as always. But put another way, the Rockefellar drug laws/strict sentencing guidelines merely act as a form of pre-crime a la Spielberg's film, if memory serves, called "Minority Report." That's where the libertarian/legalize hemp crowd misses the point, drops the bong, if you will. These laws have NOTHING to do with drugs and all to do with race. Sure if we lived in a mono-racial white society like Holland, we could have "coffee shops" and suchlike. The drug aspect is merely a Red Herring, or I prefer -- Hitchcockian MacGuffen -- a pointless plot device that drives the real motivation.

Face it, if black people could find a way to sell Tulips for big wads of cash, the State would criminalize that too. But you must also face the fact that crime HAS gone down since the enactment of those laws, alongside Roe v. Wade, to reduce black breeding. Many white Americans are not as enlightened as you are and could care less if they want to lock up every breeding-age black male. Like it or not, that is the subtext of any discussion of crime in this country. It would thus behoove you to focus your obvious intellect on more macro political change.

But I tip my hat to you for at least facing the race question, unlike, say Michael Moore's "Bowling for Columbine," which took a senile, infirmed Charleton Heston to finally obliquely ANSWER the supposed question for which the rolly-polly documentarian searched all over North America: "It's our multi-ethnicity." I guess he meant: take away the black shooting statistics and come back and discuss it, but no Hollywood movie have been brave enough to answer, I am afraid.

For a sampling of what NYC urban life was like pre-Rockefellar, just see American Gangster, or better yet the MTV documentary on the real AG, who was hardly the intelligent, proper-English speaking gentleman portrayed by Denzel Washington in the film. But that's a whole other issue.


Dan R
01 Dec 2008, 15:05
Ok, a quick point on this one.

This article suffers from the same woeful ignorance of basic economic theory as any of the others. I was floored by the thought of trusting the analysis of someone who refers, albeit in passing, to the stock market as "a casino." Where it has been "a dependable conduit for transferring wealth from poor workers around the globe to wealthier investors."

I am not sure if Dr. Niman willfully ignores blatantly obvious characteristics of voluntary interpersonal trade and the nature of wealth creation or if he simply fails to understand them on the most basic level, but the point on which we may be certain is that he certainly fails to accurately represent them here. It would behoove Dr. Niman to research the real median global wage over the last fifty years, the real median American wage over the same, along with the average rate of return for stock investments from 1913 to present, the percentages of Americans who own timesaving conveniences such a microwave ovens, washing machines, electric refrigerators, automobiles, etc. and, while attempting to square these figures against his clearly false claim, to explore the nature of equity investment.

For example. Suppose I believed that a radio station would attract listeners if it carried and provided content to which potential listeners would like to have access. I would be willing to invest my money if I believed that there existed a demand for a good that was not being supplied. If I were savvy, I would properly understand the sort of advertising revenue required to sustain my investment and furnish the money with the hope that there would be a return on my investment. Obviously, the whole thing could go belly-up, but the chance of failure hardly renders such an activity gambling. If such an investment of equity really was a zero-sum crap-shoot, the average potential return on even a calculated investment would be zero which means Treasury bond would be a better investment.

But we all know this is not the case. Business make money by providing a service to society, namely by filling a niche formerly unfilled. The enterprise of business is itself rewarded and validated by the free exchange of money for goods and services in an open market. This means that when the shopper goes to the store, he or she values the good sold more highly than the price charged for it, else the money would not be spent. Likewise, the business hopes to part with the good for the sake of the money spent by the consumer. Both parties receive benefit.

But this concept is baffling to Dr. Niman. "Impossible!" he shouts. He has apparently never been a child during Halloween and traded candy with another Trick-or-Treater. What happens there? I like twizzlers but hate snickers, you like snickers but hate twizzlers. So we trade and everybody is happier. Did anyone get exploited? Duped? Nope, it is just simple, mutually beneficial exchange.

If Dr. Niman has an aneurism trying to wrap his head around something as simple as wealth creation, why we should trust him to probe intelligently into the complex socio-economic details of criminology? But perhaps this is not fair. After all, I am willing to wager that the claim that the rich can only obtain their wealth by exploiting the poor serves a larger ideological agenda, and hence Dr. Niman is probably indifferent to its validity. Characterizing the marketplace wherein individuals trade equity shares in various enterprises and commodities as some roulette table where poor people magically get fleeced helps to exploit the suspicions and concerns of readers and to draw in the credulous and fearful to whatever half-baked argument being presented.

On the larger point of overfunding the prison system, I would certainly agree that the prison population is higher than it ought to be, however I do not really see eye to eye with Dr. Niman on the line he attempts to draw between prison overfunding and systematic racism. It would take a little more than the handful of statistics he employs to sell the point. He could start by controlling for poverty levels, along with a myriad of other sociological and cultural factors and giving this complex issue the dignity and depth due to it.

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