Gov. David A. Paterson said in an interview on Sunday that he would almost certainly seek billions of dollars in cuts to Medicaid, as well as midyear reductions in school aid, to address New York's worsening fiscal condition.
He also said he expected to urge labor unions to reopen the contracts they have struck on behalf of public employees as a way to avoid or decrease layoffs.
Such a step is reminiscent of measures taken by New York City in the financial crisis of the 1970s or moves made more recently by the Big Three domestic automakers to reduce their labor costs after years of granting steady raises and comprehensive health and pension benefits.
Those same types of wage and benefit concessions have long weighed on New York, though the catalyst for the state's current predicament has been the collapse in tax revenue from Wall Street.
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