Gov. David Paterson and state leaders addressed the media Friday to address the state?s dire financial situation and urge action before it becomes worse.

Paterson says New York is facing an "economic blood bath" and is already in a ?very serious economic crisis.? He says the Wall Street meltdown is impacting the state?s finances in a number of ways. Business tax collection will go down 38 percent, Paterson says, as Wall Street bonuses have dropped 43 percent.

Capital gains on business deals are down 35 percent and 40,000 Wall Street jobs are expected to disappear, taking a negative toll on the revenue the state is taking in.

?I estimate at the end of this fiscal year we will be down $2 billion,? Paterson told the media.

The governor is asking legislators to return to Albany for an emergency session to slash the budget by $2 million. He also challenged lawmakers to get serious about cutting spending and preserving the state?s bond and credit ratings.

Senate Majority Leader Dean Skelos (R-Rockville Centre) says he resents the ?lecture? from Gov. Paterson. ?We will get done what has to be done,? he says. ?And the way to do it is to work cooperatively.?

In terms of what can be cut, Paterson says everything is on the table.

To watch Gov. Paterson?s full press conference, go to Channel 612 on your iO digital cable box and select iO Extra.