Budget Opacity in the Town of Olive

America claims to be a democratic country and takes pride in democratic rituals. Scratch the surface, though, and elitist authoritarianism often is evident. This is true because, as the economists Mancur Olson and George Stigler pointed out in the 1970s, special interests extract benefits via the state, and in order to facilitate rent extraction democracy is skewed. The two parties compete to attract funding from special interests, and therefore must resort to deception.

One of the deception tools is the government budget. There are many tricks that politicians play with budgets. In New York, budgetary sleight of hand is almost a religion. The deception likely occurs on the level of local upstate as well as New York City and State governments. One of the major tricks is to budget one thing and fund another. When I worked for the ways and means committee in Albany, there was a state capital budget, which had nothing to do with reality, and then there was the "financial plan" which the newspapers never discussed and which was an accounting of how real money would be used.

I attended my first two successive Town of Olive Board meetings yesterday evening and had quite an adventure. The first one was a budget information meeting for candidates. The second a general budget meeting. There were a number of non-candidates in both meetings' audiences, as both were public meetings.

Soon after arriving I caused some mirth by falling asleep and snoring. Although I was rude, it was appropriate to the interest level of the discussion, which involved the Town Supervisor, Mr. Berndt Leifeld, going line by line and stating what was already written on the budget. After I was jabbed awake and the Town Clerk, Sylvia Rozelle (who comes from Kentucky originally) had quite a laugh (she told me that in the past 15-odd years three people fell asleep and they were all from West Shokan), I picked up on a discussion about the health insurance budget. It turned out that the actual spending on health insurance was very different from the amount budgeted. Although the spending was less than the prior year, the amount budgeted was 60% more than the prior year. A discussion ensued, and there was no clear explanation as to the variations in numbers.

It was obvious from the discussion that, like in Albany, the amount funded and spent with real cash often has little to do with the budget. I asked Mr. Leifeld and the Town Board if they would consider printing the program items that had significant variances between the Alice-in-Wonderland budget and the actual spending once per year in the local newspaper, the Olive Press. Mr. Bruce LaMonda, whom I know from the Emerson gym and is on the Town Board, said "no", they would not do this. During the discussion, I disagreed with one of the speakers. Then, one of the elected Democratic officials, engaging in partisan politics, suggested that I was rude, from elsewhere, and probably ought to leave town (he didn't say the last part but it was implicit). Then, Mr. Leifeld said that the meeting was intended for candidates only. Clearly most of the Democrats are committed to democracy and transparency in government to the degree that I am committed to learning the language of Bali. Perhaps they should rename themselves the "Authoritarian Party".

In contrast, Ms. Rozelle pointed out that there is a report every month that is not widely disseminated but is publicly available if requested that lists variances between budget and funded expenses. I asked to have a copy and will pick one up from her tomorrow.

I did not get thrown out of the meeting despite misbehavior. The official engaging in partisan politics apologized to me afterward, and I accepted the apology. I will be interested in reviewing the variance list and I suspect I will have to compile monthly variances to obtain a picture of annual variances.


Related Issue--Possibly Illegal Subsidy to Democrats

A related issue was raised by Mr. Chris Johansen, head of Olive's prestigious Conservative Party. The Democratic Party in Olive, the majority party, holds a successful annual fundraiser in Davis Park. Other groups, including the Republicans, also hold events. When other groups such as the Republicans hold events, the Town requires a $200 deposit. If trash is left in the park, then the money is used to remove it. Otherwise it is refunded

The Democratic Party event is by far the largest one each year, attracting as many as a thousand people, including people from as many as 30 miles away. They call it "Olive Day" and not everyone knows that it is a Democratic Party fundraiser. I have never attended but plan to one day. However, Mr. Johansen raised the point at the budget meeting that the Democrats are not required to leave a $200 deposit and the cleanup fees were likely several thousand dollars (he did not cite that number but that is my guess). He asked Mr. Leifeld why other groups such as the Republicans had to hand a check to the Town but the Democrats are subsidized. After the meeting, Vince Barringer pointed out that the Town also uses the police to entertain children at the Democratic Party fundraiser, paying them for their time.

Mr. Leifeld did not have a coherent response to Mr. Johansen's questions. I suspect that it is illegal for the government to favor a political party and the use of public funds for partisan purposes is not allowed under election and perhaps other statutes.

Mr. Johansen has given Mr. Leifeld the opportunity to respond to this question in a timely manner.