I woke up this morning to hear that New York’s Metropolitan Transit Authority (MTA) may lay off 1500 workers in order to address a projected $1.2 billion deficit. Maybe it is because I live on the Upper East side of Manhattan but every morning’s subway ride (the Lexington line) involves pushing and shoving just to get into the subway car. The thought of service cutbacks strikes me as just absurd. MTA says it was hoping for funds from the state of New York but I know Governor Patterson is also trying to address a revenue shortfall.
Of course, we could avoid the layoffs and the service cutbacks if Congress decides to expand Federal revenue sharing. It would be one way to counter the usual pro-cyclical nature of state & local fiscal policy that we noted here. I just hope this is on the agenda of President-elect Obama.