Taxpayers Foot the Bill for Spitzer Scandal

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From THESTREET.COM:

We deserve better leadership for our money.

Long after Douglas A. Paterson takes charge as New York State's governor this week, I'll still be thinking about something more scandalous than Eliot Spitzer's alleged penchant for high-priced hookers.

It's not the story that emerged after the shocker in which we learned the alleged call girl's identity -- Ashley Dupree, a 22-year-old wanna-be singer. Nor is it the $1 million that Dupree could possibly make for taking it all off again -- this time in Hustler magazine.

No.

The biggest scandal to emerge from Spitzer's demise is that millions of hard-working New York taxpayers and their families paid for this poor leadership -- and Mr. Spitzer's wildly bad judgment -- which effectively brought the state capital to a standstill last week.

The U.S. Census Bureau estimates that a four-person family in New York State earned a median of $75,513 in 2006, the most recent year for which figures are available. Managing on that sum would be tight, it seems, especially considering New York's stature as one of the nation's most expensive tax states.

The Tax Foundation, a nonprofit tax-research organization in Washington, D.C., estimates New York's state and local tax burden at 13.8% of income -- the third-highest nationwide, and well above the national average of 11%. New York's 2004 individual income-tax collections were $1,595 per person, which ranked the highest in the nation, according to the foundation.

A fraction of this money paid Spitzer's $179,000 annual salary. I know -- that's a lot less than Mr. Spitzer could have earned as a lawyer in private practice -- but more than $100,000 above the median income for a four-person family.

I have some expectations of political leaders like Spitzer in exchange for doling out my family's hard-earned cash to pay their salaries. My rules are similar to those employers impose for just about everyone else.

My first expectation is: Sexual escapades must not interfere with your job performance. After all, my family is paying your salary. Secondly: Refrain from criminal activity -- even as debates wage on about whether conduct should or shouldn't be criminal, such as prostitution. If it's against the law while you're holding office, don't engage. And third: If you do screw up, don't take the entire organization -- or government -- down with you. The business of government can't possibly get done efficiently -- if at all -- when its leaders are part of a media circus outside the statehouse.

I'm familiar with the frustrations many New York State taxpayers must feel right now about the colossal waste of their money. That's because I lived in New Jersey during former Gov. James McGreevey's administration when the governor appointed Golan Cipel, an Israeli citizen and poet, as the state's homeland security director months after Sept. 11, 2001, at $110,000 annual salary -- which my family helped pay through our tax dollars.

Cipel later resigned amid criticism that he wasn't adequately qualified. And we all ultimately learned that Cipel and McGreevey were lovers. How could a governor compromise safety by appointing a love interest -- of any gender or sexual orientation -- to oversee security and expect taxpayers to fund that person's salary? Not surprisingly, McGreevey resigned in 2004.

Every time an elected official resigns amid a scandal, taxpayers also foot the bill for the costs associated with transitioning from one administration to another. And if the scandal arises from criminal activity, taxpayers bear the costs of investigations, prosecutions and incarcerations.

Yes, I know. It's all just another day in politics. But when are we -- and our families -- finally going to stop settling for that rationale? These escapades, at state and federal levels, are just too widespread.

Most recently, they've also included Republican Sen. David Vitter of Louisiana -- a client of Deborah Jeane Palfrey, the "D.C. Madam," and Sen. Larry Craig of Idaho who plead guilty to disorderly conduct for making sexual advances to an undercover officer in a Minneapolis airport bathroom.

I've learned a new word in the wake of the Spitzer scandal. It's called schadenfreude, a German word meaning "taking shameful joy in another person's misfortune."

Several publications have used the term to describe Wall Street's reaction to Spitzer's downfall. The former governor made countless enemies there resulting from his zealous investigations and a lawsuit against NYSE (NYX) Chairman Richard Grasso over his $187 million compensation package.

But I don't feel any joy over Spitzer's downfall. And the shame isn't mine to bear.

I just feel outrage over public money that could have been better spent.

 

 

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