In the early 1980s, the New York State Division of the Budget released a retrospective on the executive budget process. The book, The Executive Budget in New York State: A Half-Century Perspective, describes how the executive budget process came to be, how it evolved over 50 years, and how it helped the state function through the Great Depression, World War II, the postwar period, and the 60s and 70s. Now, as we sit in view of 100 years of executive budgets in New York, the Division, in collaboration with the Rockefeller Institute, is beginning the process of telling the story of the next half-century. On this episode of Policy Outsider, Dominic Colafati, DOB’s unit head for the Expenditure/Debt unit, joins Rockefeller Institute President Bob Megna to talk about the project: what they hope to emulate, what they might do differently, and what comes next for the executive budget process.
Guests
Transcript was generated using AI software and may contain errors.
Joel Tirado 00:04
Welcome to Policy Outsider presented by the Rockefeller Institute of Government. I’m Joel Tirado. In the early 1980s, the New York State Division of the Budget released the retrospective on the executive budget process. The book, The Executive Budget in New York State: A Half Century Perspective, describes how the executive budget process came to be, how it evolved over 50 years, and how it helped the state function through the Great Depression, World War II, the postwar period in the 60s and 70s. Now as we sit in view of 100 years of executive budgets in New York, the Division in collaboration with the Rockefeller Institute, is beginning the process of telling the story of the next half century. On today’s show, Dominic Colafati, DOB’s unit head for the expenditure debt unit joins Rockefeller Institute President Bob Megna to talk about the project, what they hope to emulate what they might do differently. And what comes next for the executive budget process. That conversation is up next.
Bob Megna 01:24
Dominic, I want to thank you for coming in today and talking about something that I know we’ve been discussing for a long time, which is we’re coming up on the 100th anniversary of the budget process in New York, the executive budget process. And I thought it would be great to do a podcast where we talked a little bit about that and what we’re trying to accomplish in doing that. But maybe you can remind the audience about what happened at the 50th anniversary of the executive budget and how that book has kind of shaped how a lot of people have thought about the budget process.
Dominic Colafati 02:15
Certainly, and thank you for thank you for for having me. I look forward to talking with you. You know, the idea of writing a history of the executive budget system. And how that system has shaped our financial affairs is credited originally to Dr. Howard Miller, who was our budget director from 1978 to 1981. And he had a really a storied career in both government and as a professor at the Maxwell School. And the book itself was the main author was Bob Kircher. And Bob was a trained historian and someone who served at the budget division for over 30 years. So it’s a really great mixture of kind of the practical and the scholarly. And I hope the collaboration between the Rockefeller Institute and DOB on this next 50 years will be something that we can replicate that high standard. The original book was published in 1981. It really told the story how the executive budget system arose from really a period of disorganization and growth and state government in the first decades of the 20th century. And the need for what Henry Stimson said was for someone man or someone person, to lie awake at night, worrying about how the books are going to be balanced and who is going to have who’s going to be uniquely accountable to the people for the fiscal affairs of the state. So the book describes that kind of unfolding, and then also how that system was tested, and political and legal contests between the governor and the legislature, really over the 50 year period that we’re talking about. It also touches on some of the innovations in management and finance that were incorporated in the budget system, and how those affected the state’s financial affairs. Last year, it was it was it was also sort of a love letter of sorts to the division of budget, which is really an agency that doesn’t get much love and probably for good reason. And how the division evolved in response to the requirements of the executive budget system, and also to the demands of different governors, remember, we the system started with FDR who submitted the first executive budget, the official executive budget, and it concluded when Governor Kerry was in office so a wide range of of people and personalities.
Bob Megna 04:38
Yeah, I think that’s something that people forget, which is you do have an executive budget process, but it’s very dependent on who the executive is on how they want to think about the budget process and carry it out. I don’t always think about it that way. But that’s that’s a good perspective. You know, as we approach 100 years, though, of the executive budget, you know, it’s been a pretty volatile period of time with lots of different changes. And I think, as you often remind me, you know, that book was being written in the midst of the New York City financial crisis. And so, you know, from that point on that next 50 years, we want to talk about, it’s been pretty interesting. How do you see, you know, how are you thinking about how that next 50 years should be written? And, you know, what changes should we be thinking about in the approach?
Dominic Colafati 05:53
Yeah, that’s that’s a great question. I’m sure. It’s gonna be one that we we talk about in the coming months as we work through the book. I would say first that, you know, anyone who’s read the 50 year book, always seems to have the same surprised reaction when I talked to them, which is, Wow, it’s really interesting. And not only is it interesting, it’s it’s well written, it’s thoughtful, it’s carefully document it. And I think a lot of the observations still ring true. For those of us who’ve been in the system for a long time. It’s I think, from that perspectives perspective, there’s not a whole lot that needs to be revised. And I think there’s much that would be great to emulate. But, you know, the first book ends, as, as you said, really, as the city and state were really emerging from the most severe period of the 1975 1976 fiscal crisis. So that kind of makes 1977 really the natural starting point, I think, for the new book, insolvency had been averted. But the financial pressures, the demographic changes, the economic upheaval, all those things that brought the crisis to bear still had to be reckoned with. I think 1977 is also a natural dividing lines, because and the 50 years and the 50 years from the inception of the executive budget, which is covered by the first book, and certainly the 16 years of the Rockefeller Wilson administration, 1960 to 1974. You know, the state had built this remarkable, sprawling, ambitious, complex and extraordinarily expensive government enterprise. And so the first book does a lot to talk about that. I don’t think it’s an understatement to say, or an overstatement to say that every administration since Governor Rockefeller and Governor Wilson left office, every administration, we’ve had seven governors since that time, has had to contend with the challenges created by the great ambitions of the post war government in New York, up to the fiscal crisis. And that’s from maintaining spending commitments for social programs, to reducing the burden of taxes and debt to sign the loss of population to kind of retooling the economy. That just changed dramatically, not just in New York, but in the entire Northeast. By the time we got to the fiscal crisis in 1977.
Bob Megna 08:30
Yeah, Dominic, kind of your person who’s been looking at the data pretty carefully, I, I saw some data the other day, from right around the beginning of the executive budget process, which showed that if you looked at just personal income, New York accounted for more income than three of the country’s regions at the time. So to say we were an economic powerhouse when the executive budget process began is really an understatement. We were really the most wealthy state. We were in terms of both jobs, and but largely because incomes were higher. And, you know, we still hold a, you know, good position in terms of our economic strength. But certainly the country and our position relative to the country has changed radically over this whole period of time.
Dominic Colafati 09:45
Yeah, so that’s, that’s a great point. And looking at the data, I think it’s exactly that New York was this kind of any class of its own when the executive budget system came came into force. And really by 1970, you know, had it lost its first rank in population to California, from 1970 1980, population was actually going to decline for the first time since it became a state. So you had this massive building of the government enterprise. And at the same time, you have these kind of dramatic shifts that were going on, underneath. And I think we have to, we have to talk about that. And I think we also have to look at, you know, New York’s changing influence and in the country as a whole, because as you lose population, or as your population grows more slowly than the rest of the country, your number of representatives declines. And I think we had 41, members of Congress in 1955. I remember correctly somewhere in that number. You know, I think today, we probably have 26. So that’s a measurable change in kind of the kind of influence that we have at the federal level. No,
Bob Megna 10:57
that’s fascinating. 55 is a good year to pick. That was the year I was born. So in thinking about this version, updating to 100 years, what do you think we should be amplifying? What do you think? Where do you think the focus should change? How do we retain the good parts? What are the things we should be thinking about adding?
Dominic Colafati 11:27
Yeah, so I think, you know, I think one of the one of the few deficiencies in the original book I think, is there’s there’s, there’s a dearth of quantitative information, economic, financial, demographic, political, there’s really not a whole lot of information, quantitative information in the book, there’s there’s statistics reference, but it’s really not in a comprehensive way. So I think we can do a lot with that and constructing data that covers that full 100 year period and explore it for changes and have different people with different backgrounds and expertise, take a look at the data and see what it has to say. I think it’s important to give us a sense of how the state government has operated and kind of the those conditions. I think another thing that would be fascinating to look into is really the impact of interest groups, especially in health care and education. On the distribution of state resources, both have taken a larger and larger claim since 1977, which is probably no mystery to anybody. It’s also interesting to note that the first book ended with two case studies, one that was going to talk about school finance reform, and one that was going to talk about, and one that talked about controlling the costs of health care. So very contemporary issues and historical issues at the same at the same time. I think probably, we also need to give some thought to what are those public policy issues today? That someone 50 years from now looking at this book might say, Well, why didn’t they talk about that? What what’s going on? Why weren’t they speaking about those issues? So I think there’s probably issues of social justice and equity that we can touch upon that probably were not discussed at all in the first book. And then I also think there’s probably questions. And how the state’s dealing with the question of climate change, and the major, the major challenges ahead as it tries to institute and achieve the goals and in the cltpa.
Bob Megna 13:44
Yeah, it’s interesting, Dominic, I think some of that looking forward, a little bit is critical, I think to this new project. So who do you think I think part of and you talked about this before, when you talked about who wrote and who was largely responsible, though, I know a lot of people contributed to that first volume, the 50 air volume. I’m getting the sense that you think that we should be reaching out maybe for the 100 year volume a little bit more extensively. Can you can you talk about that a little bit?
Dominic Colafati 14:26
Sure. And that’s exactly that’s exactly right. And we’ve talked a little bit about this, I think we’re gonna be covering a long period of time. And we all know that no matter how well events are documented in written reports, or memoranda or news accounts, or even notes in the archives, much of the interesting stories are in people’s heads, they’re in people’s memories. In retrospect, everything looks much tidier, everything looks self evident. And of course, that’s never the case. Right? It’s So talking to people who were there, I think will bring out the uncertainties, the missteps, the accidents, that hopefully provides a more nuanced and complete picture of how, you know, public policy was was was coming about. So, you know, it’s going to be important to get the perspective of people in the executive branch, of course, you know, the budget directors, the aides to the governor, the counselors to the governor, some have played a really vital roles in shaping the governor’s powers and protecting the governor’s powers, but also the staff and the legislature, public officials, advocates of some of the more influential interest groups and unions. And perhaps even some of the news reporters who staff, the staff, the Albany Bureau over the years. It’s fascinating when you look back at the news coverage, the names that you see that were assigned to the Albany Bureau, people like Linda greenhouse, right, Elizabeth Kolbert, who’s written extensively on on climate change in recent years, you know, just a really dynamic and interesting cast of characters. And I think lastly, I think something that probably wasn’t done in the last book, but that would be useful is talking to people in the rank and file in some of the key agencies to get a sense of what their perspective is, because, you know, I think there are people view, what’s happening government differently from the vantage point where they said, and I think it would be useful to get a perspective from, if not the bottom, but from, you know, the bureaucracy and get a sense of what they thought was happening.
Bob Megna 16:36
You know, I think it’s sensitive to do. But I think we also have a significant number of still living governors walking around the state of New York and people who were close to those folks who were intimately involved in the budget process. And I think that might not have been as true for the folks who were writing the 50 year volume. And I think it might, you know, also give us some perspective to try to reach out to a few of those people and see how you know, what their recollections are.
Dominic Colafati 17:17
I think that would be great. And I will look for you your help, and doing exactly that.
Bob Megna 17:25
Well, we’ll try. Right. But I think, you know, even talking to secretaries to the governor, I think, you know, Karen Keogh, the current secretary, when this year’s budget came out, I think she did something very interesting. She She invited prior secretaries back going all the way back into the Pataki administration to come to a reception that she had, and I think if we could do something similar or figure out a way, I think, you know, we gained some insight, because I think the points you’re making are exactly right. I think a lot. Things seem easy, always after the fact. But at the time, they were pretty complicated, usually. And I think getting the perspective of folks close to the governor and outside the division a little bit is would be helpful. So Dominique, what, you know, I agree with you, I think also on the numbers piece here, I think the first volume, I think it’s fair to say was pretty skimpy on the numbers, because they were focused on something else. How, and maybe this is an important thing to do have been a lot of important court cases over this past 50 year period, coming up to 50 years. I mean, is that another group I think we need to try to reach out to right would be the people arguing those cases, and maybe if we could some of the people who were maybe even deciding those cases?
Dominic Colafati 19:11
Absolutely. I think that’s a great point. And I think when you look at the court cases that were decided, and of course everyone thinks of silver V. Pataki as a an obviously it was a very important case, but there were at least eight or nine other ones, I think that really shaped not only the relations between the governor and the legislature, but also the kind of public information that had to be included in the budget. The state’s borrowing powers, confirmation of those powers, the use of public authorities, so even though not directly related to the so called executive budget system, clearly relevant to the the orderly operation of state government. And so I think we have So we have to touch on those. And we also have to put together I think, you know, the the financial results as best we can over this long period. And that’s easier said than done, you know, the accounting standards change to make some of the information difficult to make comparable over the years. But I think we can, we can make some progress with that. But I mean, that financial information, I think expresses probably in the most concrete terms, what it is, what are the priorities of the community, however you define it, and in this case, it’s the State community. And really, who wields power and influence over how money is raised, and, and ultimately, how it’s distributed. And so I think we owe it to ourselves to look at that and see how that has evolved over the last 50 years, and also where it where it has has remained the same.
Bob Megna 21:01
Yeah, I keep coming back to some recurrent themes, which is, you know, obviously, the city fiscal crisis was still an ongoing issue when that first volume was written. But again, you can remind me a little bit because I may even be a little shaky on this part. But another thing that I think might be an added benefit, this go round is a little bit more about what the state does fiscally, as opposed to what the local governments in the state do, and the kind of relationship between them, which I think was, and that’s changed in the next 50 years because of things like school finance, and Medicaid and the things you mentioned before. But I think that inter governmental relationship is one we should think about looking at too.
Dominic Colafati 22:05
I absolutely agree. And it’s it’s interesting you say that, because I was thinking about that walking up here is that when you think about looking at financial performance, where you put the frame of the of the picture, you can look either very good or not so good. And I think we owe it to ourselves to look as broadly as possible, state and local, what the overall expenditure relationships are, what the overall tax burden is, what the overall debt burdens are. Because if you’re just looking at one level of government, and in our you know, in the state’s case, the kind of the primary level of government costs, costs can be shifted, costs can be moved. And I think we we should really be looking holistically as well as a part of this book to get a better sense of just our of our of our fiscal affairs over the last 50 years.
Bob Megna 23:02
Well, I see this, you know, because I’m a budget geek as an exciting projects. What else would have you been thinking about with respect to this project? And ultimately, who do you see as the audience for this?
Dominic Colafati 23:22
Well, that’s a great question. I think I hope there is an audience, I think, I think the audience is probably much the same as it was for the first book. First and foremost, it’s really the practitioners in government that want to understand what was done in the past, and the environment that we’re operating. And it didn’t just occur out of thin air air, it took a long time to get to this point. And at the same time, it’s an environment that can be changed. And so knowing what those knowing how that environment came about knowing what the influences were, that created it, I think empowers people to kind of understand well, going forward, how do we how do we make the adaptations and changes to be to meet the public policy issues and problems that we’re going to face in the future? So I think anyone who’s a practitioner in government, whether it’s in the executive branch in the legislature, I think we’ll find it useful. And I think people who are reporting on what government is doing, and people who are monitoring what government is doing, would find it useful. Ideally, if we if we do a good job on it, I think it would be of value to people.
Bob Megna 24:32
Thanks, Dominic. I think this was great. And I look forward to working with you on this project.
Dominic Colafati 24:40
Thank you likewise.
Joel Tirado 24:43
Thanks again to Dominic Colafati, the unit head for the expenditure debt unit at the Division of the Budget for joining us on the show to discuss 100 years of executive budgets in New York state. If you liked this episode, please rate, subscribe, and share. It will help others find the podcast and help us deliver the latest in public policy research. All of our episodes are available for free wherever you stream your podcasts and transcripts are available on our website. I’m Joel Tirado; until next time. Policy Outsider is presented by the Rockefeller Institute of Government, the public policy research arm of the State University of New York. The Institute conducts cutting edge nonpartisan public policy research and analysis to inform lasting solutions to the challenges facing New York state and the nation. Learn more at rockinst.org or by following RockefellerInst. That’s i n s t on social media. Have a question, comment, or idea? Email us at communications@rock.suny.edu.
“Policy Outsider” from the Rockefeller Institute of Government takes you outside the halls of power to understand how decisions of law and policy shape our everyday lives.
Listen to a full episode archive on Spotify, or subscribe on your preferred podcast platform.
