The Cato Insitute, a conservative think tank, released a report today grading most U.S. governors for their fiscal policy. Gov. Andrew Cuomo’s grade? D.
The report card, which graded on a scale of A through F, gave only four governors the highest grade, all of them Republicans: Sam Brownback of Kansas; Rick Scott of Florida; Paul LePage of Maine; and Tom Corbett of Pennsylvania.
Seventeen governors were awarded Bs, 11 were given Cs, and 11 got Ds, including Cuomo. Five governors — all of whom are Democrats — received failing grades: the leaders of Washington, Hawaii, Minnesota, Connecticut and Illinois.
“Many states are facing major fiscal problems in coming years,” according to the organization’s website. “Rising debt and growing health and pension costs threaten tax increases down the road. At the same time, intense global economic competition makes it imperative that states improve their investment climates.
“To that end, some governors are pursuing broad-based tax reforms, such as cutting income tax rates and reducing property taxes on businesses,” the website said. “The bad news is that many governors are expanding narrow ‘tax incentives,’ which clutter the tax code in an attempt to micromanage the economy.”
The report card evaluates governors on their spending and tax-related actions since 2010. It is the organization’s 11th biennial fiscal policy report card.
The governors receiving an A are those who cut taxes and spending the most, while the governors receiving an F raised taxes and spending the most, according to the report.
In a discussion of Cuomo’s grade, the report said that Cuomo “has not lived up to” a “pledge” he made in his January 2011 State of the State address, when he said New York must “hold the line on taxes now and reduce taxes in the future.”
See below for the full discussion of Cuomo’s grade and the report itself:
Andrew Cuomo, Democrat
Took Office: January 2011
In his January 2011 State of the State address, Governor Cuomo said that New York must “hold the line on taxes now and reduce taxes in the future.” Unfortunately, the governor has not lived up to that pledge.
In December 2011, Cuomo signed an increase in the top personal income tax rate, which is expected to raise $1.9 billion annually. A previous “temporary” hike in the top rate from 6.85 percent to rates of 7.85 percent and 8.97 percent was supposed to expire at the end of 2011. But Cuomo’s legislation will “temporarily” create a new top rate of 8.82 percent through the end of 2014. Cuomo’s tax plan included some tax breaks, but the overall net tax increase was more than $1.5 billion a year. These tax hikes won’t help the New York economy, which already suffers from having the second worst business tax climate in the nation.
There were no new taxes in the governor’s budget this year, and his spending increases have been about average among the governors. Also to his credit, Cuomo approved pension reforms for public sector workers, which could save state and local governments in New York tens of billions of dollars over coming years.
In New York City alone, the annual cost of pensions for city workers has exploded from $1.3 billion to $8 billion in just the past decade. So Cuomo’s reforms were desperately needed, but much more needs to be done to reduce government spending in New York.
Here’s the report: Fiscal Report Card on America’s Governors: 2012, Cato White Paper No. 35