Merit Mike Makes Hard Choices

Bloomy Champions Services, Rejects No-Tax-Hike Orthodoxy

It was 8:30 on Saturday morning and Mike Bloomberg, fresh from a stint on the running machine in his nearby townhouse, was at Park and East 68th Street to talk to an assemblage of the city's hard-boiled elites at the elegant headquarters of the Council on Foreign Relations.

He told the 180 gathered by the business-backed Citizens Budget Commission that his 7 a.m. simulated run had been interrupted by a citizen's call on his listed phone number (212-772-1081) with a complaint he vowed to rectify. He turned his folksy charm in the direction of Public Advocate Betsy Gotbaum, noting that they got their haircuts at the same place without adding that he'd just given her powers a pretty close cut in the recent charter-amendment referendum. He was so candid he said that "the failure to get the Democratic convention was mine," and that "we haven't made the school system any better yet," adding that the photo op when the governance bill passed "was great," but all it did was "give us the opportunity" to improve schools.

His very personal recitation of the city's revival—60 companies with long-term Lower Manhattan commitments, including Deutsche Bank at 60 Wall, where a young Bloomberg got his first job in New York, and four major media companies, including his own, building new midtown headquarters buildings—was so optimistic it undercut CBC's and his own message of peril and sacrifice ("I anticipate a boom," he beamed). Immediately after observing that the city slashed taxes by $3 billion a year in the '90s while its expenses grew by 70 percent, he declared, "No one's at fault," and urged everyone "not to look to the past," a thinly veiled shot at his profligate predecessor who now earns millions as a rectitude consultant for wayward businesses.

But his most important theme—in sharp contrast with Rudy Giuliani and the tax-increase-obsessed sponsors of the CBC—was that his top job was to protect the city's quality of life, suggesting that whenever he faced a choice between tax hikes and service-damaging cuts, he would choose taxes, as he just did with the 18 percent jolt in the city's property tax. Acknowledging that it was "not a way to win a popularity contest," the mayor, whose favorable poll ratings dropped in the Sunday Daily News to the lowest since David Dinkins's, vowed more taxes, promising that "the next step is Albany," where he will pursue a levy on what he called the $115,000-a-year commuters who use our services at no cost to themselves.

He even invoked his business experience to turn the business/GOP argument against taxes on its head, saying that "people will not stay in a place where they are not safe, healthy, and can get a good education," insisting that location decisions are more a consequence of services than taxes. His social message on layoffs, the homeless, and welfare fraud was unabashedly liberal, so much so that he even took on a questioning CBC patriarch, Steve Berger, the king of cuts when he was head of the Emergency Financial Control Board in the near-bankruptcy days of the '70s.

Berger went through one of the mantras of his day about the city's public hospitals, asking if Bloomberg was prepared to "divest" the city of this supposedly extraneous burden. The mayor, who had bragged about the high quality of care in city hospitals in his prepared remarks, said that the Health and Hospitals Corporation only costs the city $200 million a year and provides health care in neighborhoods "where there aren't other services," celebrating this prime right-wing example of city excess. He drove Berger bonkers by even suggesting that public hospitals were so good they might put some private ones out of business.

On the other hand, the mayor and his top aides—especially deputy Mark Shaw—did not hesitate to attack the overpriced bastions of right-wing myth that CBC has also debunked in scholarly reports: the police and fire departments. Bloomberg assailed the recent decision of a state-appointed arbitrator to reward cops with "a raise greater than the city budgeted without any productivity gains," condemning the police union's "unwillingness to change one iota" the zany work rules that allow them to work only 203 days a year by paying them every time they do come in for an extra half-hour of washing-up time. Shaw insisted that firehouses would still close, noting that firefighters fight fires only 5 percent of the time and "are hanging around doing nothing the other 95 percent," and that the Giuliani effort to get them to do more by merging emergency services with the department was "a total failure."

Bloomberg also went after another favorite target of the CBC, special education, saying there was "stark evidence of a need for change" in this extraordinarily costly and dysfunctional system and that new chancellor Joel Klein was "working on exactly this." Driven by the teachers union, politically wired bus companies, and others who profit from this $3.2 billion cottage industry, spec-ed has become such a drain on city resources because it's placed theoretically "handicapped" kids in the most restrictive and expensive settings at twice the national rate.

The Bloomberg team's determined shots at these sacred cows was in sharp contrast with the empty rhetoric of Council Speaker Gifford Miller, Comptroller Bill Thompson, and Gotbaum, whose conference-closing panel failed to seek a single sacrifice from any special interest. The three Democrats were more eager to demand that Washington and Albany aid our uniquely damaged city than was Bloomberg, who dismissed any notion that a federal government grown "more conservative" in the last election "would give you operating money" to help close the city gap.

Indeed, Bloomberg's low point Saturday was his assertion that his decision to raise taxes right after the governor was re-elected "had nothing to do with the electoral schedule" and that he wasn't "trying to protect somebody," even as he continued to give George Pataki a pass on the commuter tax, bridge tolls, and anything else that might help the city. But the three Democrats were no better in assessing Albany's abdication, or in putting forward a specific agenda for it.

While Ed Koch, Dinkins, and Giuliani all wound up at war with the CBC, boycotting its conferences and, at some points, barring mayoral staff from attending, Bloomberg actually met his current girlfriend, Diana Taylor, at a CBC event and brought her there this weekend. Shaw and his labor, finance, and budget brass dominated the panels, and labor leaders took center stage in ways they never had before, unwilling to concede the need to make productivity sacrifices. Though a Giuliani deputy mayor had actually called donors to the group in an attempt to get them not to contribute, Bloomberg promised that he would return next year if invited—regardless of how critical CBC was of him in the interim. It was an engaging example of how he's changed the temperament of this town.

Koch is now a panelist himself at the conferences he once assailed, declaring Saturday that he "could not remember a single commitment made by the unions" during his 12 years as mayor "that they kept," a reference to unimplemented productivity improvements that was challenged by UFT president Randi Weingarten, who spoke right after him. Koch said the only way to get the unions to accept the work-rule changes required to make the city more efficient was to give each of them a hard choice between the changes and a specific number of layoffs. But with the property-tax increase, etc. narrowing next year's gap to a more manageable $3.1 billion, as well as the passionate opposition to layoffs that Bloomberg delivered at the start of the conference, that threat, already adopted by Connecticut's Republican governor, seems unlikely here.

You can almost hear an ex-mayor Bloomberg, at some future CBC conclave, ruing the day that the unions stopped him, like every mayor before him, from reversing the featherbedding that consumes so many city dollars.


Research assistance: Sandy Amos, Yi Chen, Will St. John

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