Many of the most interesting -- and from a left perspective, most disturbing -- developments in U.S. politics today are occurring at the state level. As the excellent Center for Budget and Policy Priorities has documented, the aftermath of the recession wrought by the financial crisis has plunged virtually every U.S. state into a deep fiscal crisis. State tax receipts remain 12 percent below pre-recession levels. The states faced a total of $120 billion in budget gaps for fiscal year 2011, and are estimated to confront a total of $140 billion in budget gaps in fiscal year 2012. At the same time, fiscal assistance provided by the federal government in the 2009 stimulus bill is running out and will be almost completely gone by the end of 2012, even though the states will continue to face major budget gaps. In the context of a weak economy, both spending cuts and tax increases threaten to further depress economic activity (though targeted tax increases on the wealthy would have a less negative impact on recovery than increased taxes on the working and middle classes). Continued aid from the federal government is by far the best way of dealing with the fiscal crisis of the states without jeopardizing economic recovery, but in a political climate that's defined by deficit hawks from both parties, the chances of Congress offering additional aid to the states are about as good as the chances of the L.A. Clippers winning the NBA championship (translation for non-basketball fans: these are not very good odds).
This month, 37 state governors began their terms -- 26 of them newly elected, and the rest re-elected. As the New York Times has reported, almost all of them have called for austerity programs that, if implemented, will amount to an attack on the living standards of working people and favor the interests of corporations and the wealthy:
The prescription? Slash spending. Avoid tax increases. Tear up regulations that might drive away business and jobs. Shrink government, even if that means tackling the thorny issues of public employees and their pensions. . . . "The rhetoric has grown very similar," said Scott D. Pattison, executive director of the nonpartisan National Association of State Budget Officers. "A lot of times, you can't tell if it's a Republican or Democrat, a conservative or a liberal."
Governors across the country openly intend to use the fiscal crisis of the states to break the power of public employees' unions. In Ohio, incoming Republican governor John Kasich has called for outlawing teachers' right to strike, stripping 14,000 state-financed child care and home health care workers of their collective bargaining rights, and the repeal of prevailing wage laws concerning public contracts. Legislatures in 16 states are planning to pursue legislation that would require public sector union members to "opt in" before their unions could spend dues money on political campaigns. None of this is surprising -- public sector unions have long been a target of the right and Democratic centrists -- but the anti-union campaign is also being waged against private sector unions as well. Officials in ten states plan to introduce legislation to repeal the agency shop, potentially spreading "right-to-work" laws in areas outside the traditionally anti-union South and West. State fiscal crises have given neoliberals in both parties the opportunity to drive a stake in the heart of the labor movement and complete the neoliberal counterrevolution launched almost 40 years ago.
All of these developments shed light on the role of government in coordinating and pursuing the interests of capitalists in a bourgeois democracy. My own state of New York provides a particularly interesting and instructive example of this phenomenon. Corporations and conservatives have long complained about the power of public and private sector unions in state government (at over 25%, New York has the highest unionization rate in the U.S.), but have not had an effective organization to pursue their agenda at the state level until recently. As a candidate and now as governor, Democrat Andrew Cuomo has not only called for business to organize but has actively facilitated the process as well, resulting in the formation of the rather dramatically named Committee to Save New York, whose board is composed primarily of the representatives of wealthy financial and real estate interests -- including Felix Rohatyn, the key player in the neoliberal resolution of the 1975 New York City fiscal crisis.
As the New York Times reports, Cuomo "has more than a passing familiarity with the committee. It was organized at his urging, after a series of meetings last spring and summer at which the then-candidate pressed business leaders to take a more aggressive role in Albany." Until this week, it had not registered as a lobbying organization and as such was not required to disclose its donors or budget, but relented in the face of an outcry from public interest groups. Still, it is expected to spend at least $10 million this year in support of Gov. Cuomo's program to cut business taxes and social spending, reduce public sector pensions, and reduce the influence of public employees' unions.
The relationship between Gov. Cuomo and the Committee to Save New York poses an interesting theoretical question. In the Communist Manifesto, Marx and Engels famously claimed that, in a bourgeois democracy, the state serves as the executive committee of the ruling class. Since then, many socialists have interpreted this claim in a somewhat simplistic and conspiratorial fashion. In the standard interpretation, the state has practically no autonomy or agency of its own. It is little more than an instrument wielded by a coherent bourgeois ruling class to pursue its own interests and suppress those of the working class. But as the case at hand demonstrates, the relationship between the government and the bourgeoisie can run the other way as well. The bourgeoisie is not always able to achieve an organizational and strategic unity that allows it to dominate government at the expense of all other interests. Sometimes, government (or in this specific case, the executive branch of government) fulfills its role as executive committee of the bourgeoisie by playing the leading role in organizing and mobilizing that class politically, instead of being a mere front for its pre-determined interests and goals. This is what Cuomo has done, or at least it's what he intends to do through the establishment of the Committee to Save New York. It remains to be seen whether his innovative strategy will succeed in New York, but if it does other politicians seeking to implement austerity programs around the country will surely follow his lead. Socialists and anti-austerity activists in other states would do well to follow his fortunes.