If Governor David Paterson has his way, New Yorkers might one day be buying their lottery tickets from the Carlyle Group private equity firm and paying their highway tolls to the Calpers pension fund or the Australian investment company Macquarie Group.

While some commuters may not be comfortable with handing over the daily operation of the aging Tappan Zee Bridge to Wall Street's wizards—or with the steady toll hikes that would follow—no one can blame Paterson for trying to think outside the box.

When it comes to tax revenue, New York is hurting like a broke mule. America's housing crisis and Wall Street's collateralized wealth destruction have helped to leave the state with what is expected to be about a $26.2 billion deficit over the next three years.

As the governor put it in his televised chat with constituents Tuesday: "It is time for New York and other governments to cut up our credit cards. The era of buy now, pay later and later is over."

Whether or not that era is truly on the wane, New York stands among a growing number of states and municipalities looking to sell now, collect sooner and later. Ballooning debt burdens and plummeting tax revenues have revived governments' interest in wringing money from their infrastructure assets.

Robert Poole, director of transportation studies at the conservative Reason Foundation, said the renewed interest is natural: "As someone in Britain once said, a big fiscal crunch, like a hanging, tends to concentrate the mind."

"We've been studying privatization for close to 30 years," Poole added, "and, in general, there is a strong relationship between governments being under immense fiscal stress and their interest in privatization."

New Jersey, which faces a $3 billion deficit this fiscal year, is considering privatizing its lottery and raising tolls. California Governor Arnold Schwarzenegger, who is staring down a $14 billion deficit, recently promised enabling legislation to ease the ability of the state to partner with private firms to build and run its infrastructure.

The recent lesson of Pennsylvania has not been lost on other states. Faced with a $1 billion deficit, that state has tentatively agreed to give a private consortium a 75-year lease to run its 537-mile turnpike. The deal, if approved by the legislature, would leave the state flush with a $12.8 billion lump-sum payment.

New York's problems are particularly urgent. A main engine for economic growth in the state—Wall Street, which accounts for about one-fifth of all tax revenue—continues to drown in its own red ink; layoffs are expected to reach more than 35,000. Paterson said that taxes on bank profits, which were around $173 million in 2007, are down 97 percent.

Even some skeptics of privatization think Paterson's suggestion may be appropriate.

Stephen Abrecht, director of the capital stewardship program at the powerful Service Employees International Union, called it "an interesting opportunity," adding that it could be "very well suited to our large public pension funds." He added: "We just want it done the right way."

From the union's standpoint, that means keeping away the Carlyles and Blackstones of the world, fearing that such private equity firms may be interested in higher returns or shorter commitments than infrastructure assets can reasonably support.

So, how much could New York reap if it privatized its 651 miles of toll roads, which is among the options—along with bus services and the state lottery—being discussed?

Indiana sold a 75-year lease on toll roads with about $95 million in annual revenue for $3.85 billion, or about 40 times the toll revenue. With the New York Thruway taking in about $600 million in revenue, that multiple suggests New York could get $24 billion for the system, certainly enough to plug deficit holes for some time to come.

Who knows? Maybe the state could set an example for New York City, which is dogged by its own budget woes. Over the last few years it has floated a variety of ideas to deal with traffic congestion, including placing tolls on the remaining free bridges connecting Manhattan to Brooklyn and Queens.

The most famous of them, the Brooklyn Bridge, would certainly fetch a few billion if the city were to slap a toll on it, as the bridge had for about three decades after it opened in 1883. There would certainly be some amount of fame—or infamy—for the first mayor to actually make good on the old gag scam to sell the Brooklyn Bridge.

But privatizing a few roads won't resolve New York's current fiscal woes any more than opening up offshore exploration might cut current oil prices. Leasing assets is neither a complete fix, nor a quick one. And New York is well behind the curve.

New Jersey commissioned UBS to catalog and assess its infrastructure assets in 2006, with the idea of leasebacks or sales to private firms. New York still doesn't know what assets it has, or have any real idea what they might fetch among private bidders.

The only study underway was inherited from former Governor Eliot Spitzer, who wanted to explore privatizing the state lottery to fund a $4 billion public college endowment. (He didn't get far.)

Otherwise, Neysa Pranger, a spokeswoman for the Regional Plan Association, a private New York organization that tracks such issues, says privatization has not really been on the state agenda.

And unlike about two dozen other states, New York has twice failed to pass legislation that would define how such public-private partnerships would work or give the state's administration the right to negotiate them.

That means that even if Paterson wanted to turn the New York State Thruway over to private operators, he'd first have to pilot a bill through the sclerotic state legislature.

New York would also have to untangle the finances of its infrastructure assets, which often end up supporting a diverse array of unrelated and unprofitable side businesses. Since 1990, for instance, the New York State Thruway Authority has spent about $1 billion of its toll revenue on building canals, working on harbors, and dealing with other mandated economic-development projects that would still need to be funded.

"Right now everything is on the table, and it's going to take some planning to decide what steps will happen next," admits Erin Duggan, a spokeswoman for Governor Paterson. That is probably the understatement of the year.