By HENRY J. STERN

The Battle of the Budget, which began with Governor Paterson's radio and television address continues.

The speech above was relatively brief and delivered in five minutes to a state-wide audience. It is worth the two or three minutes it will take you to read it. It is particularly impressive to watch the governor speak. He must deliver his lines from memory due to his extremely limited vision. There are no teleprompters or other tools to assist him. He held the press conference sitting alone, not surrounded by staff.

Paterson's presentation generates sympathy for his bravery in undertaking to make specific, substantive speeches in public. His voice is relatively soft and pleasing to the ear, and his appearance, even with a beard, is neat and trim. He has the potential to be a popular and persuasive speaker, if he is thoughtful and fair in preparing his remarks. He gave many of his listeners and viewers the feeling that he is credible, certainly more so than the legislative leaders who have been berated for so many years.

When one gets down to the specifics of budget cuts, however, we encounter a certain vagueness. It is like the parties are circling for a potential struggle, but neither has yet thrown a specific punch. Don't worry, they will come.

In public finance, two axioms may be cited. One deals with taxation: "Don't tax you, don't tax me, tax the man behind the tree." Another, of more general application is, "It all depends whose ox is gored."

Ever eager to promote controversy, especially where it exists, the Post led with: "Gov. Paterson and Assembly Speaker Sheldon Silver clashed over the deteriorating state budget today as Silver bluntly questioned the governor's grim fiscal warnings and challenged him to raise taxes on the wealthy."

The Times waded into the conflict in an editorial: "Across the country, states are slashing their budgets as tax revenues dwindle. New York, with its heavy dependence on Wall Street, is far from immune to the nation's economic slide, as Gov. David Paterson this week made abundantly clear."

The Times' sympathies are with the governor, as they continue: "Cutting the budget is never easy, especially in an election year. Already the special interests, the ones that fund campaigns, have lined up to defend their shares."

The editorial continues: "New York's budget has traditionally hidden hundreds of millions of dollars in slush funds, money that legislators and the governor hand out to their communities."

The Post and the News supported the governor and budget cuts, and to a greater or lesser extent mocked the Speaker for resisting, although what he is resisting is not that clear.

The News editorialized: "Gov. Paterson laid it on the line to New Yorkers Tuesday with strong words that demand even stronger action to rescue the state from dismal and worsening financial straits. There was music to the ears when Paterson said in a TV address: 'For too long, we have done less with more and paid more for less.'" The contrarian Sun agreed with the governor's exhortation to the Legislature to reduce spending, and said it understood why he tried to create a sense of crisis. later it added: "Still, for all that was good about Mr. Paterson's televised address to New Yorkers yesterday, we could have done without the melodrama."

The struggle is just beginning to unfold. At this point, we see on one side the governor, the senate, the civic community and the press.

On the other side are the Speaker, the unions, the left Democrats and the Working Families Party. The lineup may vary from issue to issue, and the outcome is likely to be indefinite, without a clear victory for either side. Whichever side prevails in August, the others will have an issue for the September primary and the November elections. In the end, the people will decide the issue, which is something they rarely have an opportunity to do under New York State's incumbent-protection laws and gerrymanders.

Allies of the Speaker say there is no crisis this year, that the governor alone can reduce expenditures by enough to close the gap, that it is much too early to be talking about next year's budget, and that if there is a problem, the state should raise its top income tax rate beyond 8.14 per cent. New York City's top rate is 4 per cent, which means upper middle class city residents now pay 12.14%, in addition to the Federal income tax rate of 35 per cent.

These secret pools are the place to start.

StarQuest@NYCivic.org