Former Gov. Paterson Discusses Economy Since 2008

Staff Writer

Serving as a member at the Queens Tribune’s panel during Monday’s forum, former Gov. David Paterson talked about the economic challenges he faced when he took office.

In 2008, the year he succeeded Eliot Spitzer as Governor, New York State, as well as the rest of the country, was in an economic recession. Paterson only had a couple of weeks to negotiate a budget for New York State for the next fiscal year. According to published reports from that year, Paterson had to pass a $124 billion budget held over from the Spitzer administration, as well as cut a $4.7 billion deficit.

U.S. Rep. Steve Israel and former Gov. David Paterson discussed the economy during Monday’s panel discussion.  Photo by Ira Cohen

U.S. Rep. Steve Israel and former Gov. David Paterson discussed the economy during Monday’s panel discussion.
Photo by Ira Cohen

The economic recession greatly affected the country during that time, causing the unemployment rate and the price of housing to skyrocket.

Paterson looked back on that time period briefly during the panel discussion, saying he has mixed feelings about those years. He said it is not fair, to a certain extent, to blame the current economic problems on voting for programs like the Troubled Relief Assist Program (TARP) or the Dodd-Frank Act because those programs did help some who were in economic trouble.

“But I do think that to a certain extent, there were entities that benefit from those actions and a great deal that did not benefit from them,” he said “If you’re in small business or in smaller companies or even smaller banks, you were on the other end of that curve.”

He added that there must be a new economic system established with a single set of rules, or the country could head back to the problems it had five years ago.

When asked by Tribune Publisher Michael Nussbaum if the government does too much in terms of economic development, Paterson said there are a number of programs that are helpful, like Innovation New York, which he started while he was Governor.

According to Empire State Development, Innovation NY is a business fund that supports innovation, job creation and entrepreneurship throughout New York State.

Paterson said he is elated to see that program continue to be funded by Gov. Andrew Cuomo, but government can get in the way through the bureaucratic red tape small businesses are required to go through when dealing with City and State agencies, to get the service they require fulfilled.

“It’s just the time that it takes for service that a lot of small businesses that are particularly in need,” he said. “What I always thought the problem was with New York State was, we would do the big deals, big headlines, big press conferences and often not reinvest with diversification  to small businesses that really need it.”

In an interview with the Tribune, Paterson said the economy is improving but at a much slower rate than many people expected. He noted that the unemployment rate was predicted to be around five percent by now but it is currently around seven percent. He added the government’s ability to help the private sector recover from the recession has been impaired because of that slow recovery.

“When the fed put a lot of money into the economy, they were not expecting it to do that for this long,” he said. “I don’t think the forecast is bad for the next year or so, but at some point, we better get something moving.”

Reach Luis Gronda at (718) 357-7400, Ext. 127,, or @luisgronda.