When Mayor Bloomberg deployed his vast personal and political power to overturn the term limits law, he began to demystify the public relations image he had purchased at considerable expense.
It was only then that New Yorkers began to recognize the danger of making Gotham's wealthiest man its chief executive. That recognition is the reason his approval rating slipped by nine points in the latest Marist poll. The public chose a mayor; they didn't expect an elected monarch.
The latest furor over his unaccountable power is his unlawful refusal to send out property tax rebate checks that have been due since Oct. 1. "We have no money . .. . this is not a legal issue, it's a fiscal issue," he says, an argument that boils down to "I know better."
But the cupboards are bare because Bloomberg has emptied them for his own political ambitions. While the stock market was heading south, Bloomberg, one eye on a potential presidential run, raised his approval numbers by expanding the city payroll. Since 2004, he has hired at least 40,000 new city employees, while bringing his own mayoral staff to record levels.
Similarly, to help clear the way for a third term, Bloomberg has been shoveling out considerable money in the form of newly negotiated union contracts with the Policeman's Benevolent Association, DC37 and the Corrections Officers that run above the rate of inflation. If it wasn't above an elegant gentleman such as the mayor to stoop to such measures, you might call this what Tammany Hall did: vote buying. Bloomberg is only too happy to raise property taxes on the unorganized middle class if that's what it takes to keep the power of the city's politically well-organized unions in his corner or on the sidelines come election time.
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People assume that because of his successful career in business, Bloomberg is a manager and not a politician. That gets things exactly backwards.
As mayor, he's been little interested in management. When the Staten Island Ferry crashed, killing 11 people, the politically well-connected Transportation Commissioner was spared a reprimand, let alone fired. When the mayor was informed that a set of subway switches had burned out and couldn't be replaced for months or even years, guaranteeing massive delays, Bloomberg nonchalantly said fine, that's the way it will have to be. He reversed himself only after howls of public protest. When a blackout produced by Con Ed incompetence left more than 100,000 Queens residents without electricity for a week, Manager Mike declined even to visit the affected areas until the press began to hound him. Even then he declared, "I think [Con Ed CEO] Kevin Burke deserves a thank you from this city. He's worked as hard as he can." It took 13 construction-related deaths before the mayor was moved to replace the City Building Commissioner.
Bloomberg touts himself as a CEO who can negotiate the best deal for the city. But part of running the city includes bargaining with people he can neither give orders to, nor buy like the City Council. That's made Bloomberg a singular failure in Albany, where the mayor tried to steamroll his ill-conceived congestion pricing plan through the Assembly. The plan, which seemed designed as much to provide Bloomberg with a green issue for his presidential campaign as to decongest Manhattan, met with a skeptical response. Bloomberg's reaction was to blame his defeat on "gutless" opponents. While arguing over whether to reauthorize Off Track Betting, the Mayor clashed with the normally mild-mannered Governor Paterson, whose support is essential for the city; Paterson came away describing the mayor to the Post's Fred Dicker as "a nasty, untrustworthy, tantrum-prone liar who has little use for average New Yorkers."
While Bloomberg has been little interested in management, he has been superbly self-promoting. Early on he sold credulous journalists on the idea that he was a post-partisan mayor, a man who rose above conventional party politics. This is in a sense true. He has been only too willing to buy support from either of the major parties to achieve his own ends. A self-described "liberal Democrat," he shipped out with the Republicans under a flag of convenience in order to run for mayor in 2001. He then abandoned the GOP to become an independent, and his staff is now exploring the chances of his running as a Democrat for re-election in 2009.
But talk of party labels misses the point. Bloomberg runs his own personalized political party. He is not so much bi- or non-partisan as his own political pole, one that offers Michael Bloomberg as the sole program.
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The traditional danger with party candidates is that they can be bought up by special interest groups. Bloomberg reverses the old game; he's won office by buying up the interest groups.
When in office, Bloomberg - like most mayors - used public funds to keep the organized interests happy while putting the city at fiscal risk. But Bloomberg adds a twist, by dipping into his own vast treasury to buy support through "anonymous" gifts to non-profit institutions.
For years, our so-called "business savvy" mayor has only one strategy: Spend. In 2007, the city took in 41% more in taxes than it did in 2000. And yet that wasn't enough to cover Bloomberg's gargantuan vote-buying spree. During Bloomberg's first six years as mayor, notes The Manhattan Institute's Nicole Gelinas, city spending shot up about 50% - from $41 to $62 billion. That meant that even in the midst of an unprecedented boom, Bloomberg's genius required the city to incur record levels of debt.
One method of buying support has come in the form of lavish subsidies to his wealthy developer friends. Early in his administration, when Bloomberg was still presenting himself as a reformer, he promised to end the practice of "bribing companies" to stay in New York. Yet that is exactly what he did in the case of developer Jerry Speyer, part owner of Yankees, who is building the New Yankee Stadium, and Fred Wilpon, owner of the Mets. Between direct and indirect subsidies the city is committed to spend nearly a billion dollars on the two very profitable teams in what amounts to a transfer of money from working stiffs into the pockets of the wealthiest New Yorkers.
The Industrial Commercial Incentive Program, meanwhile, designed to retain business that might flee the city's onerous taxes, has doubled under Bloomberg. Today roughly 6,000 business received a half a billion dollars in the kind of rebate relief that the mayor now wants to deny to middle class homeowners.
For those who object to his tax strategy, Bloomberg always has the same response: "we're just not going to return to the dark old days of the '70s, when service cuts all but destroyed our quality of life."
It's not clear if this argument is willfully ill-informed or merely self-serving evasion. But it was John Lindsay's tax hikes in the years leading up to the fiscal crisis that sent the city spiraling down into effective bankruptcy. The upshot was that in the 1970s, the city work force faced major layoffs, which only deepened the downturn. We're again headed down that path. Even as Bloomberg hikes the wages of senior workers who are crucial to the leadership of their respective unions, and hence Bloomberg's royal re-election bid, he's threatening sizeable layoffs for the newest hires.
The city was only rescued from the Lindsay/Beame policies when the stock market revived in the early 1980s. That was the beginning of the long boom built on highly leveraged financial firms that has now come to a definitive end.
Bloomberg is so committed to his ideal of the "luxury city" run by and for the wealthy and organized interest groups that the Wall Street collapse took him completely by surprise. Like Lindsay's successor, the hapless Abe Beame, Bloomberg seems not to understand what's happening around him. His budget projections are based on the notion that the future economic path will be shaped like a U, but it's more likely to look like an L.
New York, which became ever more dependent on Wall Street's high rollers to create each new job a thousand-dollar meal at a time, is going to have to rethink its economic future. Wall Street as we knew it is never coming back. The high taxes and over-regulation Bloomberg prefers pushes out the small- to medium-size businesses that will have to drive much of our economic growth in the future.
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We're likely to look back on the Bloomberg years as a time of lost opportunities to build on the gains of the Giuliani years. Between 2003 and 2007, the vast flow of revenues produced a boom that gave the city a chance to dig out from under its massive debt and restructure its labor contracts. Instead, Bloomberg's agenda added costs that will plague the city long into the future.
There is no better monument to Bloomberg failures as a CEO - of his arrogant inability to negotiate, of his purchased reputation - than with New York's education system.
Bloomberg, who has had whole subway cards plastered with ads and full-page spreads in the newspapers touting his educational "achievements," has done a far better job of promoting himself than improving the schools. He has nearly doubled the education budget. Yet his "reforms" have created considerable chaos in the schools, which have now been re-organized three times to little educational effect. What the changes haven't produced, Bloomberg's vast PR operation notwithstanding, is improvement on the national education tests. His education legacy to date: the debts that will have to borne by a work force ill-prepared for the economy to come.
Bloomberg says he's beyond politics. He's right. We're living in his monarchy, subjects to his unwavering faith in himself.
This article appeared originally in the NY Post.
Fred Siegel, senior fellow of the Manhattan Institute's Center for Civic Innovation, is writing a book on the making of modern liberalism.
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