090120: WOW! NY Gov. Says Trillion Dollars "Not Enough"

How about THAT headline. New York Governor David Paterson is not at all afraid to add Billions on top of Trillions for economic "stimulus". This is the same governor who wants to increase revenue in his state by taxing everything from commuters to those getting a haircut (really, haircuts).

AND... At the same time the economy is suffering and people are losing their jobs, Paterson wants to raise taxes on those still working, so he can give a 30% increase in welfare benefits. This guy is nuts! Here's what he has to say about an even bigger stimulus package:

(Bloomberg) -- New York Governor David Paterson said President-elect Barack Obama's $775 billion stimulus proposal won't be enough and more will be needed as a remedy for states like his.

"It probably should be larger," Paterson said. Obama "probably wants to stay away from the 'T word,'" the governor said, referring to suggested trillion-dollar spending plans.

If it can "reignite the engine of our economy" and create some jobs, "then maybe we'll do more stimulus later," Paterson said in an interview on Bloomberg Television's "Political Capital with Al Hunt," airing today. Paterson's state needs to close a $15.4 billion budget gap though March 2010.

On the more immediate question of whom he will appoint to succeed Senator Hillary Clinton, Obama's choice as secretary of state, Paterson said he would meet in the next several days with Caroline Kennedy and others interested in the seat.

He promised to name someone shortly right after Hillary Clinton is confirmed by the Senate.

"I don't want to waste anybody's time," Paterson said.

The governor sought to shift the focus from Kennedy, saying he was surprised at the media attention that President John F. Kennedy's daughter has drawn.

When asked whether Kennedy, 51, has "the requisite skills to be a senator," the governor responded, "I will know better when I meet with her." She will be among "a couple of candidates that have asked" for such a visit, which are still unscheduled, he said. If all qualifications were equal, Paterson said he would be inclined to choose a woman.

'Relative Strengths'

"Candidates have relative strengths and weaknesses and all the candidates I'm considering, including her, have them and I'll have to decide who will represent New York state the best in the U.S. Senate," he said.

On the economy, Paterson said Obama is committing 40 percent of his stimulus proposal to tax reductions as a way to deliver on a campaign pledge.

"He's fulfilling a promise," Paterson said. "It will have a psychologically stimulating factor, the fact that somebody finally said they were going to do something and actually did it in Washington."

Tax Cuts

Paterson contends that tax cuts have proven ineffective in creating jobs and stimulating growth.

"If you give tax cuts, people hold the money; if you give back rebates, people save the money," the governor said in his Jan. 7 State of the State address. "The American public has wised up; the American public is not spending."

Paterson said in the interview that his state will derive much of the benefit of Obama's proposed stimulus package if it shifts the formula for receiving Medicaid reimbursement to favor states with the largest populations of qualifying people.

Paterson, 54, said he expects that some of the federal aid to his state would benefit projects in cities and counties.

"We're really assessing them based on their ability to start now, not geographical position or political patronage," Peterson said.

New York faces a record $15.4 billion budget gap over the next 15 months.

Paterson said he was reluctant to propose higher taxes on New York millionaires, while noting that he still didn't know how much worse the state's fiscal situation would get.

"Right now, we have not found the extent of this chaos that we are going through," Paterson said. "So I am very hesitant to tax the wealthy this early in the game when our real priority has got to be to address spending."

Alternative Energy

Paterson said his state will have to create jobs by fostering industries involved in alternative energy, biotechnology and information technology to replace its reliance on Wall Street, which accounted for 20 percent of the state's tax revenue in 2007.

"We're trying everything because 18 percent of our jobs are financial, as opposed to 2 percent in other states," he said. "Our mistake was that we relied on Wall Street so much that we overspent all of the revenue that came in, in the '90s -- that was a flourishing decade -- and have continued to spend when the revenues fell of a cliff in this decade."

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