Mayor Bloomberg’s would-be Democratic successors have spent the early campaign competing with each other on how to goose city spending, and the Republican candidates haven’t done much to change the tone.
But Bloomberg shares the blame. His open-wallet approach to governing New York was on display yesterday in his final State of the City address.
To hear the mayor speak at the (heavily taxpayer-subsidized) Barclays Center in Brooklyn, you’d think the city’s biggest problem was Styrofoam dishes. The mayor went on about how Styrofoam is “virtually impossible to recycle and never bio-degrades.” Plus, “It’s not just terrible for the environment. It’s terrible for taxpayers.” He wants to ban it.
Sorry: New York faces serious problems, yet Bloomberg’s speech offered no sense of urgency — or any idea that anything at all is amiss with much of anything else.
The biggest threat to the city’s future is fiscal suffocation. Skyrocketing costs for public workers and retirees threaten New York’s ability to provide current services.
It threatens Bloomberg’s legacy (the other big topic yesterday) as well— because the next mayor will need money to keep crime low and the city running smoothly.
When Bloomberg took office 11 years ago, health-care and other “fringe” benefit costs for public workers cost $5.2 billion a year in today’s dollars. During his last year in office, it’ll be $8.8 billion — a 69.2 percent rise.
Back then, pension costs were $1.9 billion in today’s dollars. Today, they’re $8.2 billion —a 331.5 percent jump. Debt costs, under $2 billion then, are now $6.4 billion a year.
All this has pushed up spending in the Bloomberg era — 55 percent above inflation.
You wouldn’t know that from yesterday. The mayor made only perfunctory budget remarks, and only at the end. Worse, his prescription was business as usual: “We will continue living within our means — and we will not burden the next mayor with contracts the city cannot afford.”
No, because all the city’s contracts with its workforce are expired — and the unions are waiting for the next mayor to give away the store. Why negotiate, when workers still enjoy free health-care plans?
The mayor said yesterday that “the special interests and campaign donors have never had less power than they’ve had over the past 11 years” — but you wouldn’t know it from the budget.
By putting his energy into running a victory lap, Bloomberg helps set the wrong terms for the race to succeed him.
City Council Speaker Christine Quinn, a frontrunner, gave her own State of the City speech on Monday. The centerpiece of her own plan is a “strategy . . . to borrow additional money,” taking advantage of the “once-in-a-lifetime opportunity” of low interest rates.
More borrowing when the outlook is so dubious is worrisome. But Quinn could rightly say she’s just doing what Bloomberg did — with no squawks from the “business community.”
And why does Quinn want to borrow? To build 40,000 subsidized apartments. That is, she’d use scarce city cash to benefit a lucky or well-connected few.
But there’s Bloomberg, proudly touting his own “investments” in subsidized housing — 160,000 units. Yesterday, he said that the first residential tower to go up as part of the Barclays Center project “will have nearly 200 affordable apartments.”
So Quinn is just out-Bloomberging Bloomberg here. And when her competitors, like Public Advocate Bill Di Blasio and Comptroller John Liu, say we need even more taxpayer dollars going to housing, they’re out-Bloomberging Quinn.
This happiness with the status-quo makes it harder for the Republicans. One candidate for the GOP mayoral ticket, Gristedes magnate John Catsimatidis says he’d be a “visionary” mayor like Bloomberg. And his ideas so far rival Mike’s “Styrofoam” vision — proposing a higher minimum wage for older workers, saying the MTA needs to show “more compassion,” etc.
Yes, one candidate has a record of competent budgeting: ex-MTA chief Joe Lhota. He was a top official in the Giuliani years, when spending rose less than 10 percent above inflation. But Lhota’s been reticent about it, maybe because he doesn’t want to look unhinged by pointing out current problems.
In the first year of the Bush administration, Vice President Dick Cheney said that “Reagan proved that deficits don’t matter.” Bloomberg is proving that lavish spending in New York doesn’t matter politically anymore.
One day, though, it will — but only after New Yorkers start suffering from the hangover.
Nicole Gelinas is a contributing editor to the Manhattan Institute’s
City Journal.