EDITORIAL : THE NEW YORK TIMES, USA

Rich District, Poor District

To balance New York State’s budget, Gov. Andrew Cuomo wants to cut a record $1.5 billion from the $23 billion budget for grades K-12.

The cuts would scarcely affect wealthy districts that rely primarily on local taxes to support lavishly appointed schools. But they would be catastrophic for impoverished rural districts that have been starved of state aid for decades and are still reeling from cuts levied last year when David Paterson was governor. Already struggling to furnish even basic course offerings, the poorest districts would need to cannibalize themselves to keep the doors open and the lights on.

The fundamental inequity of the cuts, as currently proposed, can be seen in how they would affect two of the state’s school districts: Ilion in the economically depressed Mohawk Valley, and Syosset, a wealthy town in Long Island’s Nassau County.

ILION

CURRENT BUDGET 2010-2011: $25 MILLION

NUMBER OF STUDENTS: 1,600

CUOMO PROPOSED CUT: $1.1 MILLION

  The system is one of the poorest in the state. More than a third of its 1,600 students are eligible for free or reduced-cost lunches, and that figure would no doubt be higher if some families whose children need free lunches to eat nutritiously were not too ashamed to apply for it.

Impoverished districts like Ilion, which has an eroding tax base and relies on the state for more than three-quarters of its budget, were supposed to fare better after a 2006 court ruling that ordered the state to give each district enough money to provide every child with a “sound basic education.”

Under a new formula created by the Legislature, some of the poorest districts were promised as much as an 80 percent increase. The increases were to be phased in over four years in steadily larger amounts. Ilion, which had been promised a 35 percent increase, got a modest boost in the first two years. But then the state ran into fiscal trouble; funding was kept flat in 2009 and cut in 2010. Like many other poor districts, Ilion retrenched. It laid off teachers and backed down from plans to expand its course offerings.

Thanks to an ambitious school building program carried out by the state, Ilion’s low-rise brick high school is in great shape and indistinguishable from similar buildings even in wealthier communities. The course offerings tell another story. The school offers only one foreign language, Spanish, and is unlikely to offer any others until and if the economic climate improves. As a result, a transfer student who was seeking a third year of French has had to take the course online.

The school offers only four of the possible 34 Advanced Placement courses, which allow students to earn college credit in high school. The Advanced Placement course in biology was particularly hard won: school officials said they had to “steal nickels here and there” to buy microscopes and other material necessary to run the course, which is certified and overseen by the College Board.

Under the Cuomo administration’s proposal, Ilion would be asked to absorb a new $1.1 million cut, on top of the $450,000 cut it took last year. That would not even come to a rounding error in the state’s richest districts. But for Ilion, whose budget is about $25 million, the new cut, combined with the $1.3 million the district is obligated to pay for raises, benefits and other costs, produces a deficit of about $2.4 million.

Mr. Cuomo has left the impression that school districts like Ilion could weather cuts by tightening their belts and winning pay freezes through negotiations with their employees. A pay freeze would save Ilion only $600,000, leaving a huge deficit of $1.8 million. The district could save money in the long term by getting teachers to contribute more to their health care costs. But that will not happen, if at all, until the current contract expires next year.

Moreover, pension expenses, which will cost the district more than $1 million this year — and about 2.5 percent more next year — are locked in by the State Constitution, which makes it illegal to reduce benefits for workers already enrolled in the system. Proposals that would create less expensive pension plans for future employees will take decades to produce significant savings.

A Minimum Wage Increase

As the nation grapples with a jobs crisis and unemployment hovers near 9 percent, it is easy for policy makers to forget the plight of those who work but earn very little. There are about 4.4 million workers earning the minimum wage or less, according to government statistics. This amounts to about 6 percent of workers paid by the hour. They need a raise.

Today, a worker laboring 40 hours a week nonstop throughout the year for the federal minimum wage could barely keep a family of two above the federal poverty line. Though it rose to $7.25 an hour in 2009, up $2.10 since 2006, the minimum wage is still lower than it was 30 years ago, after accounting for inflation. It amounts to about $1.50 an hour less, in today’s money, than it did in 1968, when Martin Luther King Jr. and Robert Kennedy were killed, Richard Nixon was elected president and the economy was less than a third of its present size.

The minimum wage has many opponents among big business and Congressional Republicans. In Nevada, the Las Vegas Chamber of Commerce is pushing to repeal the state’s minimum wage, a whopping $8.25 an hour. Representative Darrell Issa, the California Republican, has proposed a bill in the House that would effectively cut the minimum wage in states where it was higher than the federal threshold by allowing employers to count health benefits toward wages.

Opponents argue that raising the minimum wage would inevitably lead to higher unemployment, prompting companies to cut jobs and decamp to cheaper labor markets. It is particularly bad, the argument goes, to raise it in a weak labor market. Yet with unemployment likely to remain painfully high for years to come, this argument amounts to a promise that the working poor will remain poor for a long time.

What’s more, we know now that the argument is grossly overstated. Over the past 15 years, states and cities around the country have rushed ahead of the federal government to impose higher minimum wages. Economists analyzing the impact of the increases on jobs have concluded that moderate increases have no discernible impact on joblessness. Employers did not rush off to cheaper labor markets in the suburbs or across state lines for a simple reason: that costs money too.

The most recent research, by John Schmitt and David Rosnick at the Center for Economic and Policy Research, found that San Francisco’s minimum wage jump to $8.50 in 2004 — well above the state minimum of $6.75 — improved low-wage workers’ incomes and did not kill jobs. An even bigger jump in Santa Fe, N.M., the same year — from $5.15 to $8.50 — had a similar effect.

Despite evidence to the contrary, businesses and Republicans may keep pushing against the minimum wage — using the jobs crisis now to clinch their argument. They should be disregarded, because their argument is wrong and the United States is too rich to tolerate such an underclass.