The sky is falling!

Or at least, that's what some people would have you believe. Now that Gov. Andrew M. Cuomo has proposed an austerity budget which at last begins to rein in state spending, the predictable chorus of union leaders, school officials and the health industry is issuing its warning that life as we know it is about to come to an end.

The state Public Employees Federation, for example, said the proposed budget "would cripple public services." An organization of home-care providers accused the governor of "cutting at the heart of New York's health care system." The school boards association said it would take "a Herculean effort" to absorb the governor's "whopping" cuts.

So how deeply is the governor proposing to slash spending compared to the prior fiscal year? The shocking answer is: less than 3 cents on the dollar. The firmament might just remain unshaken.

Critics claim the cuts are deeper because the special interests they represent have built-in escalators that raise spending way above the prior year's level. His $132.9-billion proposal represents a $9-billion cut.

Although the world isn't coming to an end, this budget will hurt. However, that doesn't mean that the greatest impact has to hit students, the poor or the sick. Why is it that cutting arts, sports and music programs are the only alternative? Instead, the cost-cutting pressure should force changes. School boards can reduce payrolls and unions can make givebacks. Nursing homes owners can convert their underperforming facilities to assisted-living centers.

Overall, there's a lot to like in the governor's proposed spending plan. For one thing, he campaigned vowing to rein in spending without new taxes - and the document he's put forward would do that very thing, actually lowering spending for the first time since Gov. George Pataki did so 15 years ago. He's also presented a budget that doesn't have any of the usual gimmicks to indebt the state in future years.

Cuomo also deserves credit for proposing to eliminate 3,500 empty prison beds around the state, a job he would shrewdly leave to a special panel separate from the budget process and the political resistance that would come from those communities. Similarly, he proposes Medicaid cuts but leaves specifics to another panel of stakeholders. And he's called for an end to the clauses hidden in legislation that automatically drive New York's spending ever upward.

Lawmakers should embrace the principle of spending restraint embodied in the governor's plan. If they do so, then the Assembly must also pass the property-tax cap Cuomo has proposed as well. Otherwise, the cuts in Albany would only mug taxpayers closer to home with higher school district taxes, leaving them no better off in the end.

Given the state's dire fiscal circumstances, the governor has put forward the kind of spending plan the times - and the electorate - demand.

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