Empire State Implosion: The financial meltdown and the welfare state

The Wall Street Journal reports:

The global credit panic has swept away many illusions, and we're about to find out if that includes those of the politicians who have feasted for years on Wall Street tax revenues. Ground Zero is New York, which has lived a tax-and-spend fantasy thanks to the long bull market and "progressive" tax rates. Reality is now biting.

The financial services industry employs between 2% and 3% of nongovernment workers in New York, the same as it did in the late 1970s. What's changed is the share of total wages in the state represented by Wall Street jobs, which had skyrocketed to nearly 20% last year from a little over 2% in 1977.

You'll want to read this one.