Malcolm's Up Short

As Juan Gonzales highlights this morning, the senate leadership fight has gotten even more intriguing-with current leader Dean Skelos dangling plums in front of the dissidents: "In an attempt to keep Republican control of the state Senate, Majority Leader Dean Skelos is wooing three rebel Democrats with a proposal to form a "coalition government." Skelos made the offer at a dinner meeting Tuesday night on City Island with the so-called "Gang of Three" - Carl Kruger of Brooklyn, and Pedro Espada and Ruben Diaz Sr. of the Bronx, several sources familiar with the meeting said..."

So what's the supposed deal? Here it is: "Under the Skelos "coalition" proposal, the majority leader's post would be split in two - president pro-tem of the Senate and majority leader. In return for the Gang of Three backing Skelos for the first post, Republicans would help elect Espada majority leader. Kruger would then be named chair of the powerful Finance Committee and the top posts on other committees would be split between Democrats and Republicans.
Skelos has even offered nearly $6 million in extra funding for the Finance Committee and greater autonomy for all committees."

The waters are really being roiled now-and from what we've heard there's no consummation of any deal; and leaving Skelos in charge is not in the governor's interest: "The Skelos plan would still leave him and the Republicans in charge of the Senate - something Gov. Paterson and the other Democrats are expected to vigorously oppose. Even if the plan falls through, the rebels still hold the decisive votes for either side."

But with this much turmoil and uncertainty, Smith's status remains very shaky-and the NY Times profile this morning doesn't advance his interests in any real way. It is the decision of the dissidents that everyone awaits: "The governor has agreed to meet them because he is increasingly frustrated with Smith's inability to resolve the crisis, the Paterson camp says..."If this thing drags out much longer, you could see Democrats breaking away from Malcolm and looking for another Democratic candidate for majority leader," said one powerful lawmaker who has the governor's ear."

Extell Blinks: Costco Boxed Out

As the Real Estate Observer Blog has pointed out, Extel''s "Riverside Center" on 11th Avenue and 59th Street, is being set for the public reviews process: "Long in the planning stages, Gary Barnett and his Extell Development Co. have finally let loose images of Riverside Center, their planned 3.3 million-square-foot mostly residential complex at the base of the West Side development once known as Trump City. The Department of City Planning put on its Web site today an environmental review document for the project, a draft scope, which outlined the specifics of what Extell wants to put on the site, currently a series of parking lots."

What the blog fails to mention is what the development doesn't include-Costco, or any other big box use. As the Draft Scope for the project reveals: "Appropriate provisions in either a Restrictive Declaration or Special Permit would ensure that no “big-box” retail establishments (i.e.,warehouse clubs or discount department stores) would be included as part of the Proposed Project."

When Extell's plans were initially floated, Costco was prominently mentioned as part of the development; something that generated a great deal of controversy and opposition-particularly from this quarter. The real estate powerhouse, seeing the warehouse club handwriting on the wall, decided it was better to switch than fight. And perhaps Mayor Mike weighed in-sotto voce, as it were-since he received heavy criticism for his support of an auto-dependent box store in Manhattan when, at the same time, he's made traffic congestion a singular issue.

Adding to the Costco revulsion is the fact that the company doesn't accept food stamps. Clearly Extell did not need the Alliance, the UFCW, and a full complement of advocates for the hungry breathing down its neck during the upcoming ULURP process. As is so often the case, a strong initial opposition sent a clear signal to a developer that a different course of action was more prudent. Extell chose discretion over valor, and Costco once again found itself barred from Manhattan.

Lobbying Puzzle

Capitol Confidential is musing about the difficulties faced by lobbyists since the leadership issue in the state senate remains up in the air: "But given the uncertainty of the leadership vote in January, who do you lobby, Democrats or Republicans? The Senate GOP is doing everything it can to entice a Democrat to defect, but is quietly preparing to be in the minority. The Democrats are convinced that they will be in the majority in January, but nothing is for certain until the leadership vote is taken January 7."

But given the closeness of the partisan divide, the lobbying challenge will be to woo as much bipartisan support as possible-regardless of which party assumes control, so the following observation is, perhaps, a bit off the mark: "But lobbyists must play a bit of diplomacy until January, even if it seems to be headed into Democratic leadership. “You have to treat both of them like they are in the majority. Suspend disbelief that this could continue this way,” said the source."

One needs to wait and see, not only who's in charge, but how the structure of power is arranged-given all the discussions of reform-from both parties. Undoubtedly, it will take some time for all of this to shake out-even after a leader is finally chosen.

What's Your Take on This?

The Queens Chroncle believes that New Yorkers should just suck it up; and that the mayor should simply rescind those rebates: " But now, in the face of foreclosures, crumbling financial giants on Wall Street, and infrastructure that is centuries old in places, the city at large must face a harsh reality: the fiscal well has gone dry. Currently, Mayor Michael Bloomberg is exhorting city organizations to cut a total of $1.5 billion from the budget in an attempt to keep New York afloat. Closing budget gaps won’t be easy, but New York can’t operate in the red. Vital services, including police budgets, are now threatened. It’s for that reason that the $400 homeowner rebate should be rescinded and kept in the city’s rapidly dwindling coffers this year."

As if giving tax money back to its rightful owners was something that should be jettisoned before all of the city's other "essential" services." As the paper tells us: "Tax rebates are temporary for a reason. When times are good, and the city sees increased revenues from tourism, and throngs of shoppers crowding the streets, the government doesn’t need its people to subsidize things like police pay raises and infrastructure improvements so heavily."

What a load of crap! As if the folks weren't asked to fork over wagon loads full of tax cash even when "times are good." All of which leads us to ask: What prompts the Queens Chronicle to advocate such an asinine position? As a weekly read by Queens homeowners, the paper's take on the rebate issue is, well, counterintuitive.

So, as with most public policy isssues that revolve around the mayor, we're lead to speculate that somehow this Queens paper is another entity that's simply in the tank-because it's on the take, or angling to be. The following comment is almost an indictable offense: " Two-hundred fifty-six million dollars means more to New York City right now than $400 means to any one individual or family. Those millions can keep police on the street, and firemen in their stations at all hours of the night. That money can keep class sizes smaller in our schools, and can heat senior and community centers during the cold winter months ahead."

Mike Bloomberg couldn't have phrased it better-but we're wondering what the Queens Civic Congress-or our friend Rose Marie Poveromo of the United Community Civic Asociation-would say about this editorial outrage? Someone should challenge the Chronicle to justify why its views are so out of synch with its readers.

Dean of Discipline

According to Spin Cycle, current senate majority leader Dean Skelos is getting desperate: "Then, finally, there's the plan unfurled in the morning papers to put the Senate Finance Committee on steroids and hand it to Gang Dem Carl Kruger in return for his vote. One reader notes that this, of course, would be the same Finance Committee currently chaired by venerable LI Senate veteran Owen Johnson, who would apparently be rewarded for his loyalty by being dumped."

One man's desperation is, well, another's wiliness; or, perhaps we should say that, "desperate times demand desperate measures." If Skelos can pull this off, he deserves a medal-and maybe the Spin Cycle folks should be prodding Malcolm Smith into a more desperate posture. He certainly will look silly if the Skelos gambit actually can be pulled off.

For his part, Skelos showed up in the Bronx for Ruben Diaz's turkey event-as did Smith-and he offered the following about Diaz's support: ""I have no idea. I'm not a gambler. You'd have to ask him," Skelos said. I also asked Skelos about proposed changes to the way the State Senate Finance Committee operates. If enacted, they would give enormous amounts of power to the chairman, and could be a way to lure a Democrat to other side. Skelos scoffed at the idea it was an attempt to get a Democratic to vote for him as leader, saying, "No matter what you do, you're going to be criticized." He added, "We have to put politics aside. The elections are over." Glad to know this.

As far as the finance committee is concerned, this ploy may just be the beginning-with a whole slew of possible bipartisan initiatives forthcoming. Which is just what Senator Kruger told the Daily News: "Sen. Carl Kruger, who did not attend Sen. Ruben Diaz Sr.'s Thanksgiving love-fest in the Bronx this afternoon, told DN Capitol Bureau Chief Ken Lovett: "We're weeks - maybe months - away from any kind of agreement" on who will lead the state Senate. A Senate Republican plan to empower the Senate Finance Committee to woo the himself and the other Gang of Three members is a positive step, Kruger said, but added: "That move is just a tip of the iceburg. We're retooling a system that's been in place 100 years. That's not going to happen in one fell swoop."

This doesn't stop the NY Daily News, however, from its editorial presumption on the matter-assuming facts not in evidence, as the lawyers might say; the News editorials see "deform," and bribery in the Skelos move: "State Senate Majority Leader Dean Skelos is engaging in naked political bribery and calling it reform. That's how twisted Albany's culture is...So Skelos is fighting to keep his grip by luring Democrats into his column. Should one come over, he is reportedly willing to make that person chairman of the Senate Finance Committee - with a $5.9 million budget to be used as the person saw fit. Without having to get the boss' okay. That's the way the system should function on every committee - and not just as part of a crass deal. What Skelos is proposing would further deform, rather than reform, Albany."

Hold on there folks. As Kruger has said this may be-and should be-only a first step towards real legislative reform; and the News should wait a bit before making intemperate snap judgments.

And the Skelos template has appeal-even for the governor: "The Senate plan to give more power to the Finance Committee got qualified support from Gov. David Paterson, who noted it was Republicans who changed how the Finance Committee operated back in 1993...In the end, however, Paterson said he views the idea of having a Finance Committee with a separate budget and a degree of independence "a good reform idea."

What remains to be seen is the possibility that the bipartisan template could be co-opted by someone other than Skelos-who Paterson probably would wish to be displaced. The longer this drags out, the greater the possibility that a dark horse leader will emerge

Myth America

According to Liz (via Kate Lucadamo) Anthony Weiner is going after what he calls the "myth of Mike Bloomberg." And in doing so, he's hitting on some of the very themes we've been emphasizing in our commentary: "Weiner criticized the administration for increasing spending over the past six years, not creating enough jobs and (in his opinion) virtually ignoring infrastructure problems. “The only element of infrastructure that has been successful has been the city’s ability to ticket and tow your car,” Weiner told the group. Because of increased spending by Bloomberg, the congressman said, the city is “very poorly prepared” to handle the economic downturn, adding: “We have spent in the boon time instead of spending down…We have to get our spending under control.”

In attacking in this manner, Weiner seems to be preparing a left/right strategic attack plan-going after the mayor from the right on spending and overall fiscal management performance: "Weiner said the city needs to expand jobs in entertainment, culture and health care. He accused Bloomberg of “flat” job creation in the outter boroughs...“The myth that we did this great job is just that, a myth," Weiner said. "We are poorly prepared going into this downturn."

This is a smart approach to the upcoming mayoral battle. Our view is, the more folks that are out there deconstructing the mayor's image, the brittler it-and he-will become. AW is someone who is good at getting under the mayor's skin; and his foray here is useful for all of the mayor's potential adversaries.

Barbecuing the Sacred Cows

While it is true that Dean Skelos' bipartisan template for state governance might be a breathe of fresh air up in Albany, if it isn't accompanied by courageous actions than it all amounts to the proverbial rearrangement of the deck chairs on the Titanic. Dealing with the state's budget mess will take some strong medicine.

Some of this is dealt with in this morning's Albany column by the NY Daily News' Bill Hammond. Hammond dramatically underscores the current fiscal mess. In detailing the state budget's five "biggest lies," BH leaves the most significant for last:

"Lie No. 5: We don't have to cut school aid or health care.

The truth: It's unrealistic that these two programs, which account for more than half of state spending, should be treated as sacred cows. New York spends more than any other state on both public schools and Medicaid. That spending has grown substantially in recent years and, barring action by Albany, will keep going up next year. If Paterson took the drastic and unprecedented step of laying off 5,000 state workers, he would save about $400 million. But if he holds school aid and Medicaid flat - not truly cutting them, but stopping their growth - he saves $3.5 billion.
The truth is that lawmakers have no choice but to cut spending - and cut deeply. Politicians who say otherwise are either kidding themselves or lying to you."

The question here is, where are the leaders ready, willing, and able to confront this size and scope of government issue? And while we're at it, how about the patronage mills? Speaking of which, the following Op-Ed on ESDC and pork spending is certainly thought provoking: "WHEN news broke last Thursday that Gov. Paterson had spent $40,000 on a fancy rug for the governor's mansion in Albany, the media mocked him for spending on a luxury when the state faces a fiscal doomsday. Yet that 40K is peanuts. The real outrage of that day came from the governor's Empire State Development Corp. (ESDC) - which handed out $7.3 million in "grants and loans" at one of its monthly board meetings."

Of course, ESDC isn't the only place to look at when it comes to government reform-the MTA also comes to mind; as do other public authorities that seem to be really unaccountable to the public that there supposed to serve. Then there's available revenue sources-such as Indian cigarette retailers-that are being ignored by the governor.

Our old friend Arthur Katz weighs in on this in the NY Post today: "The failure to enforce the law also costs the state substantial amounts in lost sales taxes - and reduces New York City's own excise-tax collection. The total revenue loss works out to more than a billion dollars a year."

So much can and should be done to address the state's fiscal mess. Crisis does create the conditions for dramatic changes in the way the state is both structured, as well as how it approaches its spending habits. In order for this kind of bold action to take place we're going to need leadership that aware of what's needed. All of which makes the current senate leadership stalemate that much more problematic.

Bait and Switch

The stakes in the senate leadership battle just got raised. As the NY Times reports this morning:

"In a move that could help woo three Democrats whose votes will determine which party will control the New York State Senate next year, Republicans are planning to grant more autonomy and power to key committees, officials said on Monday. The most striking change will involve the Senate Finance Committee, which plays a major role in budget planning and has the power to approve all of the governor’s nominations to top executive branch jobs. Under the plan, the Finance Committee would be given its own funds in the state budget, allowing it to operate almost independently from the rest of the Senate. Traditionally in the Legislature, committee leaders are effectively figureheads who defer to the Senate and Assembly leaders."

The senate move comes on top of some "over-the-top" comments that were made by the WFP's Bertha Lewis about the possibility that one of the dissidents, Brooklyn's Carl Kruger, might get the coveted housing committee chair. Lewis charged that Kruger was, "palling around with Republican terrorists." Another supporter of Smith's, Manhattan Senator Tom Duane, had upset a second recalcitrant lawmaker, Ruben Diaz, because of the Bronx senator's position on gay rights.

So Smith finds that his ascension has just gotten a lot more complicated-with Republican senate leader Skelos talking the bipartisan game that Kruger, Espada and Diaz find attractive: "But the change would also empower Senate Republicans to offer an especially attractive post to one of the three Democrats — Senators Rubén Díaz Sr. and Carl Kruger and Senator-elect Pedro Espada Jr. — who have not yet committed to supporting Malcolm A. Smith, the Senate’s top Democrat. Mr. Smith needs their votes to become majority leader when the Senate meets in January. John E. McArdle, a Senate Republican spokesman, said that the overhaul was intended to provide “a more bipartisan basis for functioning” and could extend to other committees, allowing rank-and-file members of both parties to participate more."

The independent finance chair would have, not only a great deal of autonomy, but the resources to go with it. As the NY Post describes this morning : "Senate Republicans, who narrowly lost majority control on Election Day, are moving to create a nearly $6 million honey pot designed to encourage one of the "Gang of Three" Democrats to defect to the GOP side, The Post has learned."

This is, as the Post points out, one mighty big carrot: "For the first time in 14 years, the Senate budget, which cannot be altered by the governor, will contain a separate $5.9 million expenditure for the powerful Finance Committee, the chairman of which will be chosen in January by the next majority leader. "It's a carrot that people will take a look at," a Senate source said. "The money will be there for whoever heads the Senate Finance Committee next year, it means power and influence and a seat at the table for whoever is the chairman."

So clearly, the Republicans are pulling out all of the stops-but the bipartisan template could be co-opted by any putative leader-imitation being the greatest form of flattery. Here's Kruger's response to the Times: "In an interview last week, Mr. Kruger said that such a change would bring the Finance Committee’s leader “to its rightful place, where the finance person was looked at as maybe the second most important person in the conference and in the Senate.” Mr. Kruger would not say whether he was in discussions to assume the chairmanship of a newly empowered Finance Committee, but said “anything is possible.”

In this high stakes game of political chess, the next move goes to the Democrats; and the threats from some quarters could lead to unintended consequences that the party wants to avoid: "Democrats will hold 32 seats in the Senate next year, while Republicans are likely to hold 30. But Mr. Espada, Mr. Kruger and Mr. Díaz have remained coy about whether they will support Mr. Smith or the Republican leader, Senator Dean G. Skelos, leaving control of the Senate up for grabs."

Your move Mr. Smith-or perhaps it is the governor that needs to weigh in here; that is, if he wants to be able to help choose his dance partner in what will no doubt be a difficult budget season. What we do know, is that this whole fight has just been given a greater degree of complexity and nuance.

Rebate Tsuris

As council members Gentile and Ignizio have pointed out, the refusal of the mayor to give out-or to even delay-the rebate checks to home owners is causing real hardships; and the NY Daily News underscored some of this in an article yesterday: "Sisters Rosalyn Lipsky {no relation} and Mildred Corwin planned to paint the hallways in their two-family house in Mill Basin, Brooklyn. That's been postponed. Italo Sgaraglia and his wife, Eleanor, thought they were going to be cozy and warm this winter in East Elmhurst, Queens. "Now I'm going to have to turn the heat down," said Sgaraglia, 75 and retired. "Eleanor's going to be cold." The Lipskys, Corwins and Sgaraglias, like many other families, have scrapped plans, rebudgeted or will make sacrifices because their $400 property tax rebate checks did not come in the mail the first week of October as promised by the city."

Of course, this is all either a "minor economic issue" for the mayor, or a shiny example of his realism in the face of economic disaster. New Yorkers are not responding charitably: "The shock was immediate. "Everybody needs $400 in this economic meltdown," said Rosemarie Provermo, a Queens homeowner and head of the United Community Civic Association. "For a lot of people," she said, "it means are you going to put a big turkey on the table this Thanksgiving, or just some chicken."

And generally when the shock wears off, it is replaced by something else: "And the anger builds.
"Normally, we put that $400 toward our mortgage that's $2,002 a month," said Lucina Clarke, who lives in a two-family home in Canarsie, Brooklyn, with her husband, Wayne; her mother, Irmene Pascall, and her teenage children. "The mayor pulled the rug out from under us," said Clarke, adding that her husband will have to put in more hours at the medical lab where he works."

The anecdotal evidence is building here, and the city's middle class home owners are ripe for the picking by any decent Bloomberg opponent. The following end quote should be seen as emblematic of the problems the mayor's likely to face in the next election cycle: "Jade Munday, who lives in a semidetached home in Brooklyn's Marine Park, said, "Not having that $400 is hard. Every year we use it to help pay the gas bill. During the winter, it's $160, $170 a month."
Munday, whose husband, Robert, is a lineman with Verizon, has two toddlers and a third child on the way. "My mortgage is $2,500 a month, then we've got $120 for electricity, then gas and water," Munday said. "Really, we could use the money."

Snatching Defeat From the Jaws of Victory

Yesterday Malcolm Smith did the decent thing; distancing himself from the abhorrent comments that linked Senator Carl Kruger to "Republican terrorists." As Liz first reported:

"Still trying to lock down the majority leader vote, Senate Minority Leader Malcolm Smith distanced himself from a key ally who accused dissident Democratic Sen. Carl Kruger of “palling around with Republican terrorists” and warning there will be "hell to pay" if Kruger gets to chair the Senate Housing Committee. Smith, who is trying hard to secure the votes of Kruger and his fellow Gang of Three members, issued a statement critical of the comments made by Bertha Lewis, Working Families Party co-chair and the chief organizer for ACORN National. “The comments by Bertha Lewis are inappropriate and we do not condone such over-the-top rhetoric,” Smith said. “My conference and I look forward to working with our fellow Democrat, Sen. Kruger, on our bi-partisan reform agenda."

Kruger, while expressing appreciation for both a Smith phone call, as well as his public comments, did seem to further distance himself from the possibility of supporting the current minority leader-a distancing that the Padavan recount surge abets: "But while Kruger, who earlier told the Associated Press he wanted a statement from Smith repudiating the comments, said he was appreciative of the statement and a personal call from Smith, he said Lewis’ comments seriously jeopardized the possibility he’ll back Smith. “What Bertha Lewis’ infusion into this speaks about is not so much her statements, though they re repulsive, but rather the fact that she feels she’s been empowered (by) her position,” Kruger told DN Capitol Bureau Chief Ken Lovett."

Kruger apparently is concerned about the intimacy of the WFP's relationship with too many of the senate Dems-from the top on down: “I do believe because of her working relationship with the Senate that she has the license to make those kinds of statements and that’s a sad commentary,” Kruger said. “It weighs very very heavily not only on my decision, but also the mindset of my two (fellow Democratic dissidents)," the senator added, further noting: (Smith) is not apologizing. He’s distancing himself from her comments. But I would never have embraced her in the first place.”

Bertha, for her part, appears unapologetic about the monkey wrench she's thrown into the leadership battle. If addressing the state's problems in a bipartisan and non ideological manner is a Smith priority, than the Lewis entourage may become serious baggage weighing down any successful leadership achievement for the beleaguered Malcolm Smith. Liz's blog post heading-"With Friends Like These"-is apt indeed.

Fire Sale

As Azi reported yesterday, the city is about to begin to cut essential public safety services: "Here at the City Council budget hearing on public safety, Fire Commissioner Nicholas Scoppetta testified a few minutes ago that his department will begin closing “several fire companies” between the hours of 6 p.m. to 9 a.m.--a savings about $8.4 million. Scoppetta later said the department will eliminate five fire companies, but the department has not identified which ones.

So, as we have speculated, the Bloombergistas begin to wield their budget ax, and do so against what is essential for any municipal government to maintain: its fire protection for the neighborhoods of the city. And in doing so, Bloomberg is emulating the cutbacks initiated by former mayor Dinkins; beginning with treating the department as if it was a McFire Department-with less staffing in the evening than during the rest of the day (and, of course, more fires are at night-with the greatest threat to life).

Isn't it time for everyone to acknowledge that Mike Bloomberg hasn't provided the necessary leadership that would have prepared government for what we're facing today? As Spin Cycle pointed out yesterday-in regards to the state budget-a time of crisis is also a time of opportunity: "Some lawmakers and economists were hopeful that budget director Laura Anglin would advise Paterson to use the huge budget deficit as an excuse to reinvent government. Some suggested merging agencies and authorities with overlapping responsibilities such as the Transportation Department and Thruway Authority."

Have we ever seen this creativity from the Bloomberg administration? Instead we get the following obsequiousness from a manager who was over his head at ACS, and now facing the closing of fire companies: “We have a very good relationship with City Hall and that means a very good relationship with the mayor. The fact that he’s going to be here, we think, for five years instead of one more year, is a very positive thing, for the fire department and for the city.”

Oy vey! It's time to retire these folks. If FDNY believes that this is what constitutes a good relationship with the mayor, than we'd hate to see what happens to the agency that gets on Bloomberg's bad side.

Leading Up to Chaos

The comments of Bertha Lewis this morning still continue to roil the senate leadership fight. As Liz B reports, another of the rebel three, Senator Ruben Diaz, is also taking umbrage at the Lewis calumny: "Reacting to speculation that Kruger might be named Senate Housing Committee chairman in exchange for his support of Smith, Lewis accused the Brooklyn lawmaker of "palling around with Republican terrorists" and said there would be "hell to pay" if he was tapped to head the committee. "We were making progress and now we're back to square one," Diaz said. "People should not be making these comments at this stage in the game. It doesn't help. It didn't help when (Sen.) Tom Duane made his comments, and it didn't help when Bertha Lewis made hers."

Or, possibly, "with friends like these..." At any rate, both Malcolm Smith and Dean Skelos will be attending the annual Diaz turkeys for seniors bash tomorrow in the Bronx; and Skelos might be feeling a bit better since Liz is also reporting that Frank Padavan is looking pretty good in his senate recount: "The 11th SD recount is dragging toward a close, and things are looking up for incumbent Republican Sen. Frank Padavan. As of last night, 692 votes separated Padavan from his Democratic challenger, Councilman Jim Gennaro, according to someone involved in the recount process."

Liz also reprises the premature Stavisky chest thumping that we had admonished him about: "That's still slightly less than the 723-vote lead Padavan had on election night, but more than his low of 474, which caused quite a bit of glee in the Senate Democrats camp - so much so that Gennaro consultant, Evan Stavisky, declared that the GOP senator's was plummeting "faster than the Dow under George Bush." As of this moment, it appears Stavisky might have spoken too soon. The Republicans are again feeling confident that Padavan will retain his seat, which would be a blow to Senate Minority Leader Malcolm Smith has he tries to reach the magic 32 number that will land him the majority leader's post."

So we suggest that everyone should probably just chill a bit, let the turkey digest, and see what transpires after the holiday. After all, no one wants to contemplate what would happen if no one has enough votes to be designated the senate leader.

As the TU wrote this morning: "As for the Senate majority leader battle, if a majority leader isn't chosen in January and there is no Senate secretary appointed either, staff payroll and operating expenses can't be paid, said Dennis Tompkins, a spokesman for Comptroller Thomas DiNapoli.
If Republicans and Democrats are still locked in a fight, Tompkins said the secretary of the Senate, Steven Boggess — a veteran aide to former Senate Majority Leader Joseph L. Bruno — would be recognized as having the ability to advance expenditures to the comptroller, but only the current staff payroll would be honored. "If Boggess retires, then we've got a problem," Tompkins said."

And it looks as if Boggess will be gone before the end of December in order to be able to lobby without running afoul of the state's new ethics law: "The GOP exodus has begun. Steven Boggess, the longtime secretary of the Senate, plans to retire before the end of the year, DN Albany Bureau Chief Ken Lovett reports. A source close to Boggess said he will put in his papers sometime this week and be gone by Dec. 30 so he can begin a yet-unspecified lobbying career."

Hold on to your hats folks. We're not out of Chaos Forest quite yet.

Tax and Rend

Apropos of our earlier discussion of Carl Kruger, Bertha Lewis and the WFP, comes the following discussion on the severity of the state's fiscal crisis from Spin Cycle: "Gov. David A. Paterson is warning that next year's budget will be "grim," with retrenchment virtually everywhere, from schools and hospitals to building projects and social welfare agencies.The cuts will probably be deeper because of last week's failure by Paterson and lawmakers to close a $2-billion hole in the 2008-09 spending plan. That red ink now must be rolled into the projected $12.5-billion deficit for 2009-10, precipitating reductions in spending rather than slowing its growth."

What this means is that the size and scope of government will need to be addressed-and Long Island tax payers and homeowners are in Newsdays' focus: "Long Island has a lot at stake in the 2009-10 budget. Area public schools received $2.6 billion in aid this year and a future reduction would probably spark a hike in school property taxes. The region's hospitals rely on billions of dollars in Medicaid reimbursement, nearly $2.9 billion in 2005. And Long Island Rail Road customers are facing possible fare hikes and service cuts as the cash-strapped Metropolitan Transportation Authority struggles with little hope of help from the Capitol."

Centrist Democrats like Carl Kruger-as well as those Republican "terrorists"-are going to be vital players in the upcoming grim budget battle: "This is going to be an extraordinarily difficult budget that is actually unprecedented in the lifetimes of most of us," said Assemb. Robert Sweeney (D-Lindenhurst). "The governor probably will call for cuts across the board. I don't know if he will propose any new revenues, but I think it's inevitable."

In this context, the role of the WFP will become central; and Governor Paterson's effort to act in a prudent and pragmatic fashion-much like PE Obama is doing-could be challenged: "Raising taxes right now would diminish the number of people who live in this state," Paterson said. Fiscal experts were divided over whether Democrat Paterson would succeed in shelving the
millionaires' tax, given strong support for it among the Assembly's Democratic majority. But even if Albany were to soak the rich a bit more, the experts said, only about $2 billion would be produced, far short of closing the two-year, $15-billion deficit."

Let's face it, the extreme left wing of the Democratic party has no interest in reining in government; yet the current crisis offers up a perfect storm moment for reform:

"The billions and billions from Wall Street that the state relied on in the past simply aren't there anymore," said Robert Ward of SUNY's Nelson A. Rockefeller Institute of Government. "Washington is likely to help New York ... but it's certainly not going to bail us out
entirely."Some lawmakers and economists were hopeful that budget director Laura Anglin would advise Paterson to use the huge budget deficit as an excuse to reinvent government. Some suggested merging agencies and authorities with overlapping responsibilities such as the Transportation Department and Thruway Authority."If you just craft a budget from the point of view of cutbacks without looking at the opportunity for reform, you may not be in the strongest position to leverage support for what's going to be some very tough medicine," said state Comptroller Thomas DiNapoli."

One thing is certain; this is a time, not for vitriol and rancor, but for bipartisanship and cooperation-something that the outrageous Bertha Lewis charges threaten: "State Sen. Craig Johnson (D-Port Washington) agreed, adding that adoption of a lean budget wouldn't be effortless just because Democrats will control both houses of the legislature and the governor's office come January. "You are going to have a better working relationship between the three parties," he said, "but there are going to be challenges."

Biking Up the Wrong Tree

As if we didn't need more proof that the Bloombergistas were hostile to neighborhood business, we now find that the folks over at the DOT want to "redesign" 8th Avenue in Chelsea with bike lanes: "Chelsea residents and cyclists from all over the city reconvened this week to discuss the proposal to install a buffered bike lane on Eighth Ave. after the issue created a stir in the community this summer...Ultimately, though, the committee members {CB #3} voted 8 to 2 in favor of the lane, asking the Department of Transportation to address any concerns raised by the community."

Not that the good burghers of Chelsea were unaware that this might cause trouble to local merchants: "Chairperson Jay Marcus said his committee wants the DOT to reach out to businesses along Eighth Ave. to discuss the possibility of mid-block loading zones, side-street parking and other options to mitigate problems the lane could pose to deliveries."

Nothing like signaling one's approval before ascertaining the potential impact on the community stores; and we loved the hauteur here: "Fellow committee member Eric Muise called the new lane part of a “fantastic program,” noting that “75 percent of us do not own cars.” What abou the tax base and the access for emergency vehicles? As the DOT's borough commissioner pointed out: "Margaret Forgione, DOT’s Manhattan borough commissioner, said that DOT has been in constant contact with the Fire and Police departments, and that they have not expressed concerns about the proposed new lane on their operations."

The transportation advocates are, as always, living in a world where cost as well as benefits are not considered; particularly when those costs upset their simplistic-and ideological driven-world view. As one business related: "Rick Schmetzler, co-owner of the Gym Sportsbar on Eighth Ave., said that although he is “an avid bike rider, I don’t think this has been very well thought through.” He claimed that the DOT has done “absolutely no outreach to business owners.”

Our friend Dirk McCall was right on point at the CB meeting: "Dirk McCall, executive director of the Greenwich Village-Chelsea Chamber of Commerce, spoke on behalf of several business owners who he said either couldn’t come or couldn’t stay long enough to speak at the meeting. He and other members of Board 4 surveyed every store along Eighth Ave., and McCall said that overall owners are “extremely opposed” to the lane...McCall refuted claims in the community that storeowners are OK with the proposal, saying that he has received several “furious calls” from owners on the matter."

It would seem to us that, at the very least, a full EIS needs to be done so that environmental as well as social impacts can be properly gauged. Will the bike lane impede business and create even more hazardous motorist and pedestrian traffic? We should have some idea before embarking on an experiment that would, in our view, create even more traffic congestion in Manhattan.

Leadership Holdup

We've been accused on occasion of verbal overkill, but we're not even in Bertha Lewis' league when it comes to rhetorical excess; as Liz Benjamim reports this morning in the NY Daily News: " Working Families Party official has accused a renegade Democrat of "palling around with Republican terrorists." She's also warned state Senate Democrats there will be "hell to pay" if Sen. Carl Kruger of Brooklyn is given a key committee chairmanship in exchange for his leadership vote."

Now, intense partisanship is definitely one of the most identifiable features of the American democratic tradition, but every so often it spills over into something ugly; and that's what Ms. Lewis has done. Labeling anyone a terrorist, particularly when they are simply in disagreement over one public policy, is to poison the political debate in our state-and to the blur the line between those of us who are simply political opponents, and those really dangerous groups and individuals who threaten are way of life. Keep in mind as well, that there are those who believe that the platform of the WFP poses a threat-to the very solvency of our state's finances.

New York State is facing its most severe fiscal crisis in over 70 years, and the solutions proffered will require bipartisan negotiation and accord. In addition, we believe that part of these solutions will need to address the fact that New York is rated 49th out of 50 states when it comes to the hospitality of its business climate. Needless to say, the state's hard working citizens, many of whom are represented by Kruger and the so-called terrorist Republicans, are suffering from ruinous tax rates at all three levels of government.

It is in this context, that the WFP has called for further increased taxation in order to insured "shared suffering." This view is less likely to include paring the state's bloated payroll in order to relieve homeowners and businesses of the burdens that make New York a challenging place to live and do business in. We believe that it isn't in the interest of the Democratic leadership of the state senate to allow itself to be held hostage to any interest group; and especially one that believes we can tax our way out of the current crisis.

In any case, putative leader Smith should speak up here and make it clear where the party stands vis a vis allies and supporters that step over the rhetorical line and issue unseemly and anti-democratic threats. President Obama has embarked on a sensible and pragmatic course, one that is irking his more frenzied partisan ideologues; Governor Paterson and the senate democrats need to follow his example. New York voters still occupy a sensible middle ground, and the response that the party gives to Berth Lewis' outrageous accusations will send a signal as to where the Democrats stand, and what they believe is appropriate political dialogue.

As an aside here, it's interesting that someone has apparently shot Lewis out of a cannon on the issue of who chairs the housing committee. To our knowledge Senator Kruger (Carl, that is) has never asked for chairmanship of that committee, or any other, in exchange for his vote. There is, however, someone who's deeply concerned about the housing chair: "The rent laws don't expire until 2011, but the Senate Democrats have said they'll seek to repeal the Urstadt Law. That would take control of rent regulation out of Albany and give it to city lawmakers, who are closer to the issue and potentially harder for anti-regulation interests to influence. The ranking Dem on the Housing Committee is Sen. Liz Krueger, an upper East Side lawmaker seen as pro-tenant."

If any one's fingerprints are on the Lewis outburst, they would belong to Liz Krueger; and the Lewis charges against Carl Kruger can be seen as a preemptive strike-one that sets the stage for a potential showdown that can severely hurt the electoral roll that the Democratic party has been on in the state: Kruger insists he has "never had any conversations with anyone concerning any committees" in exchange for his support. He called Lewis' terrorist comment "an overstep in this day and age." Senate Democrats, he said, are being "manipulated and held captive" by Lewis and the Working Families Party - and he suggested she "butt out."

The Lewis outburst, then, lays out a gantlet to the leaders of the party. Whatever one can say about Kruger, he's always been a loyal Democrat; he even supported Freddy Ferrer in 2005 when folks like Malcolm Smith were abandoning the party to support Mike Bloomberg. He's also been close to Governor Paterson, and has made substantial contributions to both the governor and the state party.

The governor's response, and those of other party leaders will say a lot about where Democrats stand-and the manner in which the senate leadership battle will get resolved in the coming weeks. It would be sad indeed, if a loyal Dem like Kruger was isolated to such an extent that it would force him in a direction that the Bertha Lewis' of the world wouldn't like. Senator Kruger gets the last word here: "He also warned that Lewis' tactics could backfire and lead him to support a GOP majority leader, which would lead to a GOP housing committee chair."She should butt out and let the professionals who were elected to lead their constituencies make these decisions," he said."

The Royal Shaft

The reign of King Michael I, and the prospect that it might continue, brings to mind a royal screwing of yet another kind-that paean to divorce sung by Jerry Reed: "They split it right down the middle, And then they give her the better half. Well, it all sounds sorta funny, But it hurts too much to laugh. She got the gold mine - I got the sha-a-aft."

Well, Mike Bloomberg brought his own goldmine to the city; yet it's New York's tax payers, ignored by a cavalier and mindless spender, who have gotten the shaft-beginning with the whopping commercial real estate tax in 2002, and continuing with a less than austere response to the demands of a municipal labor force that the mayor has cultivated without regard to the fiscal consequences.

In yesterday's NY Post, Fred Siegel underscores this grim reality, one that has been masked by a less than scrupulous media oversight (which, thankfully, has begun to change). And the term limits power grab initiated the beginning of a more careful evaluation of the mayor's tenure: "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."

So what does Siegel see in the Bloomberg Error? He sees a mayor, who just last week was refusing-illegally as it turn out-to send out rebate checks to homeowners, who has acted with fiscal irresponsibility in the pursuit of his own ambition: "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."

An item in yesterday's NY Post on the DOT's hiring makes the same point: "JUST weeks before Mayor Bloomberg ordered city agencies to come up with $1.5 billion in savings to help balance the battered city budget, the Transportation Department doled out raises and promotions to four dozen top managers." This isn't something new, but a trend that has characterized the Bloomberg approach to government.

As Siegel reminds us: "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."

Siegel also deconstructs the mayor's the phony, "Great Manager," appellation:

"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."

Then there's the mayor's complete failure to negotiate with his Albany equals: "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...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."


Yet when it comes to self promotion, there's no one better than Mayor Mike: "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." Post partisan he is-elevating the Bloomberg banner while transcending those grubby political interests that serve other, less noble, individuals and groups.

And then there's Bloomberg's ironic reversal of the, "controlled by the special interests," charge: "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."

And if you want to see how this kind of anonymity produces results, take a look at Greg Canada's treacly paean to the mayor's stewardship of the schools in yesterday's NY Daily News: "The key to the success of the new system has been holding officials truly accountable. It is not about any one mayor, but about having an elected official whose job description includes a clear mandate to improve school performance as much as he or she is responsible for making sure that the streets get swept and that emergency services are operable. New layers of bureaucracy will take us straight back to the bad old days, when corrupt and self-interested bodies answered to no one. We can't have it both ways: either one person is in charge, or no one is."

Any time an Op-Ed like this appears, the author should be required to disclose how much he or she has received from one of the mayor's philanthropic conduits; it certainly was no accident that Canada had an honored place in the front of the line at the term limits hearing down at city hall. Rank has its privileges, and all that.


But Canada's praise is way off base with the school reality. As Siegel points out: "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."

Many of these themes are well mined by Wayne Barrett, but Siegel goes further to demonstrate the extent to which Bloomberg's philosophy of government (sic) has been destructive from the get-go: "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."

This is from our great fiscal steward-someone who uses the bad old 1970s in both an ill informed and disingenuous fashion: "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."

And all the while, the mayor tries to pass this off as tough love-dramatizing the extent to which abuse can be redefined when the abuser has unlimited cash reserves. In yesterday's NY Daily News, Adam Lisberg hits on this mantra: "Bloomberg, however, is not in the dumps - because he thinks he's seen this all before. He made even harsher decisions to balance the budget when he took office; today, he loves to use them as examples of how when politicians make the tough calls instead of ducking, the public appreciates it later. "If any of you want to close firehouses, put a smoking ban in and raise property taxes, and then do a parade on Staten Island, you can join me," he told a Senate panel in June. "Today all of those things are popular, so what do I know?"

This is as good an example of the mayor's arrogance and tone deafness as we've ever come across. The property tax hike is now popular? Well, what do we know? But it does appear that the mayor may be falling into the trap of all those army generals who are always fighting the last war: "The first time Bloomberg tried those cuts, it helped get him reelected - or so he thinks. This time may be tougher. "You like a good fight if there's a good win at the end," Quinn said. "After one round of tough choices, there's going to be another round of tough choices."

Not only will it be tougher, but the Bloomberg will be further off of this rose as we devolve from, and further into, the term limits issue. Here's the money quote on this from Siegel:

"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."

The harsh reality is that business man Bloomberg had a great opportunity to build on some of Rudy's hard won reforms-he simply lacked any real understanding of government, and was shackled with a Nelson Rockerfeller world view that made him ill-equipped to govern creatively: "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."
In contemplating giving Mike Bloomberg a third term, the cliche about finding oneself in a hole and understanding that it would be useful to stop digging comes immediately to mind. We must never forget that it was the little engine who couldn't that got us into this sinkhole in the first place.

Slip Sliding Away?

Well the Marist Poll is out, and it looks as if the mayor may be heading onto a slippery slope-as his popularity has taken it's first dip: "Although a majority of registered voters in New York City -- 59% -- think Mayor Michael Bloomberg is doing either an excellent or good job in office, his approval rating has dropped significantly. This is the first time since 2005 that his job performance rating has dipped into the 50 percent range"

As we have been saying, the term limits debacle may have created the conditions for a popular re-evaluation of Bloomberg; with his "above politics" image severely tarnished. As the poll reveals: "Mayor Bloomberg may have won the battle to extend New York City’s term limits, allowing him to run for a third term, but he has a long way to go to convince New Yorkers that the change is a good one. While 30% of the electorate believes the decision by the City Council and the mayor is good for the city, a plurality of the electorate -- 43% -- disagrees with the change. In fact, 48% want the courts to overturn the decision and revert back to the two term limit. 42% think the courts should uphold the new law."

In our view, once the image is challenged, a degree of vulnerability is created that can, if properly exploited, lead to the mayor's demise. The calamitous economic conditions-and the mayor's response to them-will provide the backdrop for the ongoing political narrative; but term limits extension may prove to be Bloomberg's Rubicon. As Liz tells us: "On term limits: 40 percent of those polled said they're less likely to support the mayor for a third term because he changed the rules mid-stream"

As the City Room also indicates, the Marist Poll revealed that Congressman Anthony Weiner was in striking distance of the mayor-with Bloomberg receiving only 51% of the vote to Weiner's 37%; a sign that the mayor may be vulnerable, especially as he is forced to make any number of unpopular decisions around the city's budget. Clearly, the political terrain has shifted, and the result of next year's mayoralty is perhaps not as much of a foregone conclusion as many of us have thought.

Update

According to Marist pollster Lee Miringoff (who agrees with our point above), the mayor's current poll numbers could be a harbinger of things to come: "Says Miringoff: "He is popular but the numbers have declined so the question is are we looking a short term fallout from the term limit or are we seeing a trend line with people being dissatisfied because of the economy."

Rebate Debate

It appears that Scrooge McBloomberg is having second thoughts about his tax rebate decision-or maybe it's an attitude adjustment. As the NY Times reports: "A day after defiantly asserting that the city could not afford to send out $400 rebate checks to homeowners, Mayor Michael R. Bloomberg struck a far softer tone on Thursday, saying he would cooperate with the City Council, which has been urging him to release the checks. "There’s nobody who would like to send a check to every homeowner in this city more than me,” the mayor told reporters at a news conference after appearing at a luncheon on Staten Island."

Maybe someone got to Hizzoner about how the folks are really hurting-and it is, after all, their money that's being returned:“It’s not easy to stand up and say: ‘Look, we just don’t have the money,’ or ‘We’re not really sure that we have the money,’ ” he said." Than why does it seem that Mike Bloomberg really doesn't have any great difficulty telling people to just suck it up?

As for the NY Post editorialists; can you say schizophrenic? The paper just loves to whack the city council-but in this case the mayor's tax and spend behavior complicates the attack: "Hizzoner wants to keep the city's books in balance - in accordance with the law. Imagine that.
And absent a way to cover the checks, he says he won't just pop them in the mail - notwithstanding council diktats. "We have no money," Mayor Mike said Wednesday. "This is not a legal issue; this is a fiscal issue." But of course he has money. City Hall will haul in some $60 billion this year. That, in fact, is a lot of money. It's just a matter of how it'll all be spent."

Exactly so; and as the Post has pointed out in the past-see Heather McDonald's piece on the $433 million a year cost of housing unwed mothers-there's a lot in the $60 billion that can avoid the euphemistic label, "essential services." The Post goes on today to challenge the council; but it is the mayor who calls the shots here: "Make no mistake: The property-tax rebates were meant to soften the blow of an 18½ percent hike that Bloomberg never should have imposed in the first place. And though the rebates are a pittance, compared to that hike, the more money returned to taxpayers, the better. But if they are to go out - and the budget is to remain in balance - then something's got to give. What does the council suggest? Don't hold your breath waiting to hear."

In our view, it is Third Term Mike that should be setting the tax cutting and budget reduction table. After giving little credence to the seriousness of the city council over the years, the Post shouldn't all of a sudden ask the body to do what apparently the mayor doesn't have either the inclination or the chops to do.

Winner Take All?

The Politicker is reporting that State Senator George Winner believes that the defections of two or three rebel Dems can lead to what he calls a "fusion" government: " "A fusion" scenario would exist if two elected Democrats kept their party enrollment, but crossed lines to vote for Majority Leader Dean Skelos. Skelos was re-elected unanimously as his conference leader earlier this week, but the official vote on who controls the whole chamber comes after new members are seated in January. "I know that that interest on our side in looking at a fusion-type of government is certainly there," Winner said."

Well, duh! Of course the Republicans, who are two slices short of a loaf, would welcome a fusion that allowed them to maintain their majority; but the rebels may have other ideas. As Liz B reports, Senator Kruger ain't showing love to either side: "I don't approve of the way Skelos handled himself or Malcolm," the senator continued. "Assembly Speaker Sheldon Silver, he comes to the table with a lifetime of experience...In this particular case, if he saw the Senate was dysfunctional, then the Assembly could have passed a bill and thrown it at the Senate. "Waiting for Dean Skelos and Malcolm Smith to strip to the waist and duel on State Street is not the way of governing."

And the NY Times agrees with the Skelos assessment: "Before Mr. Paterson and the legislative leaders could hammer out the final details, the Senate’s Republican leader, Dean Skelos, announced with great fanfare and unbelievable cynicism that he was prepared, then and there, to call for a vote on the governor’s draft plan. In raw, unmediated form, that plan was sure to lose. The governor had no choice but to cancel the proceedings and send everyone home. The Republicans’ strategy is obviously to defer all the tough choices until next year when the Democrats will be running the whole show: the governor’s office, the Assembly and, at long last, the Senate. But while tactically shrewd in a narrow political sense, Mr. Skelos’s approach is fiscally irresponsible."

We're not gonna wait for the Times to ever become ecumenical enough to mention the fact that some of the Democrats were also being both cynical and pusillanimous. We didn't here a peep from Speaker Silver; you know, something to show some heart to the governor.

So it appears that the recalcitrant donkeys aren't eager to pledge their fealty to either side; and the longer the wait goes on, the better looking these Dems do get. And if Malcolm in the Middle is waiting for Frank Padavan to crater, he just might be waiting until the twelfth of never. As Spin Zone tells us: "Democrats are complaining about the conduct of the recount in Queens, where Democrat Jim Gennaro trails incumbent Republican Sen. Frank Padavan by 500 votes.
Typically, that's a leading indicator that Democrats don't think Gennaro is going to pull it out. Not always, but typically."

Still, the Times recycles the race canard this morning-in the form of Hypocrite-in-Chief Michael Reich: "They are challenging ballots based on a technicality that had never been enforced in the past,” said Michael H. Reich, the executive secretary of the Queens Democratic Party and one of the lawyers overseeing the counting. “But they are only doing it to Democratic voters and voters with names that they assume are African-American, Latino or Asian. They’re not doing it with voters they presume are white. I am outraged by this.”

Sure he is. This is the same First Reich that spent the last few years doing everything in his power to keep the first Hispanic from Queens, Hiram Monserrate, from going to the state senate. He should shelve his faux outrage for a gullible jury. As the Times points out: "For the time being, the disputed ballots are placed in a cardboard box on the floor of the meeting room, and a judge will eventually rule on their validity. As the pile grows, so does the anticipation among Democratic and Republican leaders throughout the state."

Back to the rebels, Senator Kruger's complaint revolves around what he perceives is the lack of any clear philosophical direction by either of the putative senate leaders; a meandering that could lead the state into disaster: "Kruger rather ominously predicted that if the state continues down this path, it could eventually find itself no longer under the control of its own destiny and under the thumb of a higher power - perhaps a monitor or emergency control board that forces spending cuts and doesn't care which special interest contributed cash to your campaign account."

It's time for the senate to come up with leadership that addresses the need to cut the size and scope of government. Our favorite wacko, Supervisor Paul Finer of Greenburgh, wants to cut the county government out entirely. As Politicker indicates, citing Finer: "There may not be will among a lot of politicians right now, but as the economy worsens and taxes keep going up and up, we have to look at ways of really running a government to reduce costs. And eliminating a layer of government could do that," he said this morning."

The need for consolidation must be taken seriously-for school districts as well as layers of government. So far we haven't seen anyone really ready to think out of the narrow box of big government orthodoxy; but the current budget mess just might stimulate a willingness to leave old, stale shibboleths behind.

Kruger Caricature

In the discussions of the three amigos challenging the senate leadership of Malcolm Smith, one senator, Carl Kruger of Brooklyn, as been caricatured as a neanderthal right winger. Now, however, comes this from Spin Cycle: "Sen. Carl Kruger of Brooklyn...is one of the three Democrats counted by the camp of GOP Leader Dean Skelos (R-Rockville Centre) as potentially putting him back in power in January despite having lost the majority on Election Day. But at least on one hot-button issue, the commuter tax, Kruger is probably no ally of Long Island, which is purported to lose clout under the transition to a Democratic Senate. The GOP-friendly Kruger has released a statement calling for the tax's "long-overdue disinterment."

So all of the character assassination probably should stop; and the question of who should lead the senate needs to be addressed honestly-and not through the invidious lens of the politics of personal destruction. Here's a clip from Kruger's press statement: "The .45 percent commuter tax was established in 1966 and repealed in1999 amid a hotly contested special Senate race in Rockland County. Sen.Kruger was one of the few legislators who did not support the repeal of thetax. While the repeal may have wooed suburban voters, it was a“shortsighted and fiscally unsound move that failed to acknowledge future economic downturns, which – surprise of surprises -- is exactly where we are now,” Sen. Kruger said."

Training Days

According to Liz, the emerging senate majority is going to training camp: "Well, at least they’re not heading to sunny San Juan, nor is it in the middle of the summer track season, but the Senate Democrats later this month and in early December will be heading to a retreat in Saratoga Springs, pictured above, during which they will attend what was described to me as “Majority School.” That means they will be boning up on how to actually run the Senate, which they haven’t done in decades but will have to do in January once they take the majority from the Republicans.Among the topics that Malcolm Smith’s new incoming majority plan to cover: Chamber and Floor management, Committee Structure and Ethics. The seminar will also end with a “mock session” in which the Dems will get to practice gaveling in."

We wonder whether the three amigos have been invited to attend; but, all kidding aside, shouldn't all of our elected officials be concentrating on devising solutions to the state's budgetary meltdown? And many observers are wondering whether the senate as a whole is simply out of touch with the average needs of New Yorkers.

At least that's the opinion of Anne Michaud-now operating out at Newsday: "What do Long Islanders want? The way our state senators are answering that question here this week is worlds away from what people are saying at home. My neighbors and friends want affordable taxes, communities where their kids can buy starter homes, and a reasonable level of service from the government entities around us - schools that teach well, safe streets, a decent train or bus ride, and care for people in need."

Do our senators understand this? "Given the times, most people would understand if state government cut spending. In fact, if that would help us reduce our tax bill, we would be thrilled." Unfortunately, that message isn't getting though, according to Michaud: "But it's impossible to glean what Long Islanders want by watching our senators' actions this week. The delegation of eight Republicans and one Democrat, Craig Johnson (D-Port Washington), blocked cuts to the state budget that Long Islanders would likely support."

Perhaps the municipal unions and the Working Families Party are controlling the narrative-and the WFP's Dan Cantor believes that taxing the wealthy is the answer: "Yes, prudent spending cuts in state spending are a necessity - that much is undeniable. But so far, the governor is asking working families to shoulder the entire burden of the budget deficit alone, while taking any income tax increase on New York's many millionaires off the table."

Perhaps Cantor's unaware of the high levels of existing taxation that New Yorkers suffer with; and the disproportionate burden upper middle, and upper income citizens already are asked to shoulder. Making the state more productive for small businesses and job growth should be priority No. 1.

And Cantor relies on our experience post 9/11 as an exemplar to guide our present action: "In 2003, following the economic downturn caused by the 9/11 attacks, the national recession and the burst of the dot-com bubble, New York relied on modest increases in income tax rates on the wealthy to help close its budget gap. The state employed a temporary top rate of 7.25% for single filers with incomes over $100,000 and 7.7% on income over $500,000. The rich did not leave the state. Instead, the economy rebounded and the number of high income New Yorkers continued to grow."

That recovery, however, was Wall Street driven; and is unlikely to be repeated any time soon. Raising taxes in this recession would be a job killer as well as a budget buster. We need real state leaders who understand just how dire this situation is; and who also comprehend the realistic remedies that we need to pursue. Training our new class of leaders without addressing the core policy issues is simply inane-a non sequitor that elides any solution to the state's problems.

Marie Bloomberg

Mike Bloomberg's charm was never his strong suit, and now the mayor's renowned superciliousness may be reaching epic proportion; In classic Marie Antoinette style, the mayor is demonstrating an almost complete disdain for the suffering of New Yorkers during this severe economic meltdown. As the NY Times reports: "One city lawmaker called it Mayor Michael R. Bloomberg’s “Let them eat cake” attitude...At a news conference, Mr. Bloomberg described the rebates as “up in the air.” Asked what he would tell homeowners who have been depending on the money to pay bills or buy holiday gifts, he responded: “Plan for the worst, and hope for the best.” When pressed, the mayor said: “I just answered your question. You just don’t want the answer.”

Call it an Annie Hall, "La Di Da," moment. The NY Post weighs in as well; and with a number of city councillors filing a lawsuit, there's gonna be a heightened focus on the mayor's attitude. When pressed about his plan to lower the thermostats in city buildings the mayor responded in a cavalier fashion that his patented: "During another part of his press conference, the mayor said he's going to order thermostats lowered in city buildings. "It's hardly a big deal to keep everybody working," he said. "Wear a sweater if you're chilly."

This was all on top of threatened city layoffs. As the NY Daily News points out, cataloguing the mayor's callous responses: "Call him Mayor Doomsberg. In rat-a-tat fashion on Wednesday, Hizzoner:

-Warned city workers they are in danger of being laid off.

-Defiantly told homeowners not to count on property tax rebates.

-Ordered city thermostats turned down as temperatures hovered near freezing."

The mayor's view? "You're trying to plan, if you're a city worker, whether you're going to have a job. You have to start worrying about that and plan," Bloomberg said. "There's an awful lot of the 300,000 municipal employees who have got to start worrying about their jobs." And they called Don Rickels, "Mr. Warmth."

All of which has started speculation that the mayor's insensitivity isn't gonna serve him well as we head into a new election cycle of his own design. The Times captures this: "The mayor has argued that the city cannot afford the rebates this year. Still, Mr. Bloomberg’s remarks left people in the political world scratching their heads, with some accusing him of profound insensitivity to those who lack fat bank accounts, especially as job losses and foreclosures mount in the city."

Lew Fidler rails on the mayor-a portend of things to come: “It’s the height of arrogance and insensitivity,” said Councilman Lewis A. Fidler of Brooklyn, who also said that Mr. Bloomberg had a “Let them eat cake” attitude toward the homeowners. “They look at what does this mean to someone on the Upper East Side or Central Park West and say, $400, so what?” Mr. Fidler said. “I’m looking at it from what it means to Mrs. Goldstein, a 72-year-old senior in my district who lives on Social Security and is counting on that money,” he added, using a hypothetical example."

In our view, Mike Bloomberg may not be the best kind of leader as we enter a real "feel your pain" era: "The mayor’s comments recall previous remarks that have left him seeming out of touch with those he governs. When residents complained that the city was issuing parking tickets after a snowstorm in 2007, the mayor — who typically takes the subway or a chauffeured sport utility vehicle to work — suggested that New Yorkers stop “griping.” About crowded subways, he has said: “So you stand next to people. Get real. This is New York.” This year, responding to complaints that black rubber mats and other playground equipment get dangerously hot in the summer, the mayor said: “If it’s hot, don’t sit on it. Air-conditioning the slide is not something we can afford to do.”

Now don't get us wrong; straight talk is often both necessary and desirable during a crisis of this proportion. However, delivering the bad news takes a degree of skill and empathy that Bloomberg simply doesn't have. And when you try to illegally withhold needed holiday cash from suffering citizens, it isn't the best idea to show do so with such boorishness.

Mike Bloomberg is being severely challenged; and he has never reacted well when this happens: "But it also appears that Mr. Bloomberg is irritated by a newly aggressive City Council, which was deeply divided over his move last month to push through legislation allowing him to seek a third term. One person close to the mayor, who insisted on anonymity to avoid revealing private conversations with Mr. Bloomberg, said the mayor was especially irked that four Council members went to court on Tuesday to try to compel the administration to issue the rebates immediately. Richard D. Emery, a civil rights and election lawyer, said he was dumbfounded by the mayor’s stalling in sending out checks he has no legal authority to cancel. “The pattern of Bloomberg arrogance is reaching frightening proportions,” he said. “The impetuousness is kind of scary.”

So, as we have said, here, here and here, Mike Bloomberg's on a political slippery slope that originated from the moment he turned tawdry with his term limits power grab. Going from that Tammany moment into a season of tax increases and service cuts will escalate the growing disenchantment with the mayor that New Yorkers will begin to feel with Mike Bloomberg. The hand writing is on the wall; now all we need is a credible populist challenge to His Arrogance.

Costco's Stamps of Disapproval

As the City Room blog has reported, Costco is running into considerable flack because of a store policy that doesn't honor food stamps: "Costco in general has a reputation of being a socially conscious company,” said Eric N. Gioia, a city councilman from Queens who last year began a campaign asking Costco to accept food stamps after discovering it did not during the “live on food stamps for a week” stunt. “There is no logical reason for someone not to accept food stamps. It is not only compassionate, but it’s good for their bottom line.”

Of course, the fact that the Costco store in Long Island City is a stone's throw from public housing with 30,000 low income residents, only adds to the controversy-since these folks aren't able to take advantage of the store's bargains by using food stamps. The fact that Costco has a $50 membership fee also restricts the availability of the retailer for all New Yorkers.

One of our main problems with this policy, is how the citing of these box stores-and BJs doesn't accept food stamps as well-impacts local supermarkets; the box stores drain higher end customers and erode the ability of neighborhood markets to survive. In effect, you create an oasis in one spot-and desert everywhere else.

And the store's food stamp policy is designed to redline the poor. When the Alliance stopped a Costco store from locating in Hell's Kitchen, we discovered that the company's SEC filing detailed how their refusal to accept food stamps-as well as its membership fees-controlled company "slippage" (corporate speak for theft).

Yet, as Albor Ruiz opines this morning, it is the poor who are most in need when it comes to the availability of food stamps; and Costco's policy has a disparate impact on those most in need: "Councilman Eric Gioia (D-Sunnyside) is also worried about the food situation. He is demanding that Costco change its policy of not accepting food stamps. "Especially with the rising food prices, hundreds of thousands of people in New York find themselves in a position they never thought they would be in - having to choose between buying food or paying the rent," Gioia said. In Queens, the Costco on Vernon Blvd. in Long Island City is within walking distance to the nearly 30,000 city housing residents of Queensbridge, Ravenswood and Astoria Homes that Gioia represents."

City Room captures some of this flavor: "The government pays dollar-for-dollar for the food stamp use, so it is not as though Costco has to discount their margins. Costco, which has created an image that has both upscale and downscale appeal, has been known for attracting the elite (at least in Washington). But perhaps Costco is more wary of the other end of the spectrum, finding western Queens appealing for its real estate, but not for its customer base."

So NYC needs to evaluate all special use applications for box stores-particularly if it wants to preserve our disappearing supermarkets. The other night, Eyewitness News dramatized the extent of this problem-highlighting Key Food on Bruckner Boulevard, and the loss of markets in East Harlem. As the Sandra Bookman report stated: "This is happening all over the city," said Enrique Vega. The South Bronx community activist is among those fighting to keep the Key Foods at Bruckner Boulevard and White Plains Road from closing when its lease expires at the end of the year."

And our good friend Mary McKinney weigh in as well: "It's about the dollar. Forget about the people in these communities. We have lived in these communities. We have built these communities, and most of the people that own this real estate, don't live in our community. We're saying think about us," said Mary McKinney. In fact, more and more residents of New York City's poorest communities are being forced to buy their food at neighborhood bodegas, few of which carry nutritious fresh produce."

So the Costco situation is bigger than simply the store's refusal to accept food stamps; and the public health is at stake: "And that, says the Bloomberg administration, points to a looming health crisis."Those areas of the city that had the highest incidents of obesity and diabetes also had a lack of neighborhood grocery stores," said planning commissioner Amanda Burden."

The more we approve new box stores, the greater the threat to neighborhood supermarkets, stores that do accept food stamps. And this supermarket dearth was a topic at yesterday's Food Policy Conference that we attended at Columbia. As the Politicker points out: "Meanwhile, the city is thinking about incentivizing the construction of supermarkets—which have been on the decline in recent years—or even building them on public land."

In the coming battle of Brooklyn box stores, this issue will be front and center, since the promotion of BJs and Costcos can't coexist with the concomitant support for supermarket growth. Choices need to be made.

Bloomberg Redux

As a postscript to the Barrett deconstruction of Mythic Mike, its good to take a look at Fred Siegel's piece in the Weekly Standard on the mayor-it goes along way towards introducing a modicum of reality to the false propheteering that surrounds Mike Bloomberg: "The folks over at Newsweek have a sly sense of humor. They put New York mayor Michael Bloomberg on the cover of their November 3 issue and let him dispense fiscal advice to the next president. In the article, Bloomberg, who has presided over record levels of spending and debt increases, chastised "Washington" for putting us in a hole by "spending with reckless abandon for years." The lofty Bloomberg told Newsweek's readers, "Programs that don't pass a cost-benefit analysis, that have been driven by politics rather than economics, should be cut."

The Bloomberg fable has nothing that hasn't been adequately explained in the wonderful Hans Christian Anderson tale about the emperor and his new clothes: "Newsweek's offices are in New York City; shouldn't Bloomberg's assertions have raised a few red flags? But on he went. The mayor, who has nearly doubled spending on education with no known return on the investment other than a vastly expanded PR staff and chaos in repeatedly reorganized schools, talked about "our [educational] success in New York." Did Newsweek notice that the additional $9 billion he's spent on education hasn't shown up in any improvements on national tests? The article closed with Bloomberg's heartfelt advice to the next president to "demonstrate that your talk of bipartisanship is not just talk." Here his deeds have generally been as good as his words. He has been willing to spend vast sums to buy support in both parties to achieve the greater glory of Bloomberg. He has the money, resources, and advisers to be his own party and is less bipartisan than he is an alternative political pole, one that offers Michael Bloomberg as the sole program."

What we have is a cult of personality for someone who is lacking in the basic requisites of such cultic-like devotion. And, as we have been noting, the term limits debacle has started to tarnish the phony accolades that his paid retainers have foisted on a no longer so gullible public. As Siegel points out:

"Until a few weeks ago New York had a term-limits law--twice ratified by public referenda--that limited the mayor and the city council to eight years in office. Bloomberg could have held a referendum on overturning them--a referendum he was very likely to win given his 70 percent approval rating. But there were dangers in taking the democratic path. The referendum would have been scheduled for February 2009, and, as Baruch College's Doug Muzzio notes, voters are likely to be hit before then by hikes in their property taxes, water bills, and subway fares. The tough times, though softened for the political class by Bloomberg's deep pockets, might have produced only a narrow victory unbefitting a Great Man. Instead, operating on the basis of ambiguities in the city charter, Bloomberg strong-armed the city council into overturning term-limits: threatening to cut off funds to their districts and stop his "anonymous" donations to the nonprofits they count on to get out the vote if they opposed his plan."

And, just as we chided Barrett for his misplaced praise for first term Mike, Siegel hits on what that term actually started to set in motion: "For the time being Bloomberg, who presided over the great spending spree of the last few years, has been reduced to insisting that only a genius like himself can save Gotham from the fiscal dangers imposed by Wall Street's collapse (and his own maladministration). This seems odd since the man who spoke of New York as "the luxury product" has shown no interest in nurturing small businesses, which are essential for regenerating the economy and have been squeezed hard by his administration's search for revenue. Though Newsweek might not have noticed it, there was a net middle-class out-migration from New York City even in the midst of the late lamented boom."

So it's time to shelve the hagiography and the slavish flaunting of praise on Mike from those who have (or hope to) benefited from his bountiful handouts. As Bloomberg prepares to go to his hackneyed and injurious tax raising policy approach for a second time, the observations of Nicole Gelinas are germane: "Mayor Bloomberg should remind himself: New York’s small-scale industry is likely just as fragile as Wall Street right now. Many businesses likely cannot withstand even marginal fee and tax increases, never mind the big ones on the table. Some people argue that there’s no alternative to raising taxes in this environment, but in this environment, there may be no alternative to not raising taxes."

Follow the Leaders?

Yesterday's aborted legislative session didn't receive high parks for any visible demonstration of political leadership. Even Governor Paterson, who did stake out some sane positions on the budget, wasn't treated kindly by a press that saw his calls for cooperation from the assembly and the senate fall on deaf ears. As Bill Hammond points out this morning: "There were winners and losers in Tuesday's Albany budget battle but the biggest loser was you - THE TAXPAYER. By doing nothing, the Legislature put basic services like schools, public safety and mass transit in jeopardy of even deeper and more damaging cuts - and greatly increased the likelihood of economy-sapping tax hikes to close the gap."

The governor also looked weak, according to a number of Albany observers: "GOV. PATERSON was another loser: Although he held the high ground on substance, Paterson looked weak and ineffectual in his first major defeat since taking over for Eliot Spitzer in March. Instead of wielding his executive clout to pressure lawmakers, he folded like an MTA map." Fred Dicker agrees: "Paterson himself had the pained look of a promising student who first dazzles his teacher and then flunks his big exam."

Of course all of the other leaders received their share of criticism, but Hammond singles out Malcolm Smith: "SENATE MINORITY LEADER MALCOLM SMITH (D-Queens) was another loser. Smith, who intends to take over as majority leader in less than two months, looked unready for the big leagues. He went from delivering unconvincing talking points with a glazed expression to blowing his stack at Assembly Minority Leader Jim Tedisco (R-Schenectady). Granted, he was in the impossible position of explaining why he was too chicken to vote on the governor's budget cuts. Still, successful leaders must be more convincing defending the indefensible."

Smith, who is already busy preparing for his coronation, has still been unable to corral dissident Democrats to his side-and one of those rebels, Pedro Espada from the Bronx, is receiving kudos from El Diario for his calls for Hispanic empowerment. While another holdout is under siege from gay activists, an attack that will only serve to harden his opposition to Smith.

All of which raises questions about Smith's abilities to lead-and the cries of racism in a vote recount in the Padavan senate race by the very same Queens Democrats who bolstered the minority leader's rise, only reinforces suspicion that the whole enterprise isn't ready for prime time; especially when charges of racism and homophobia are the only apparent substance of the rallying cry for a Smith leadership.

What's needed from our political leaders are common sense fiscal solutions that rein in the size and scope of government, and make New York a better place to live and do business in. The new senate leader has to have both vision and courage; and be able to be a partner for the governor in these most dire of times. That leaders wasn't present in Albany yesterday.

Bloomberg Exposed

Wayne Barret has produced a magnum opus on the "transformation" (public deterioration) of Mayor Mike Bloomberg. We can only hope that it is a prelude of more explication of how, in the articles apt subtitle, "the benevolent billionaire with no political debts ended up owning us all."
We should add, however, that, as brilliant an expose as the Barrett piece is, we take strong issue with its initial premise: "Mike Bloomberg is the best mayor—in fact, the best state or city chief executive—I've covered in 31 years at the Voice. He's also the worst."

We'll get to our disagreements later; Barrett's brief against the mayor is so powerful that our discussion shouldn't be marred by any initial quibbling. What he does so masterfully, is to detail the web of elite special interests that have been harnessed on behalf of the promotion of Mike Bloomberg-and how these interests have been aggrandized in the process. Here's the money quote on the monied elites shilling for a mayoral third term:

"No one is suggesting that these giants didn't actually believe their arguments for a third term, but the large number of Bloomberg fans who are also Bloomberg beneficiaries makes it harder and harder to distinguish enthusiasm from interest. His control over a vast city budget, hundreds of millions in private donations, and billions in undisclosed personal investments cloud the authenticity of every nice thing said about him. And a day-after-Christmas decision last year by the Bloomberg-appointed Conflicts of Interest Board (COIB) has made his money trail both more expansive and more elusive. At his request, the board decided that he would no longer be restricted to salting away his money in "large, professionally managed mutual and exchange-traded funds." The COIB now allows Bloomberg's influential investment advisor, Steve Rattner, another big third-term booster, to put Bloomberg's estimated $20 billion fortune to work in a wide variety of investments, so long as he and the rest of us never find out precisely what they are."

Even more devastating is how Barrett details the seduction of the city's publishers-aided and abetted by Public Servant Rubenstein (Howard, for the unenlightened): "We are all used to editorial boards making endorsements determined by their owners, but this was the first time in memory that these three proud institutions had marched in such lockstep on a policy matter after meetings between a political figure and their three owners."

And Barrett dramatizes how all three of the media moguls have had interlocking business interests with the billionaire mayor; so much so that any real journalism has been suborned by the cash nexus-we're way beyond the ward healers of Tammany Hall. The NY Daily News' Mort Zuckerman's front and center here:

"The colossus we know the most about is Zuckerman. When Bloomberg ran for mayor in 2001 and the Daily News was the only paper to endorse him, he held more than a half-million dollars of stock in Boston Properties, the publicly traded real estate company that Zuckerman controls (Bloomberg may have actually owned more, but, by law, he was required only to disclose dollar amounts up to that ceiling). Bloomberg had to give up those holdings when he took office, prompted by an earlier COIB ruling, and the Bloomberg administration ended up doing its share of deals with Zuckerman's company—like air rights and other approvals on the company's 39-story tower at 250 West 55th Street. At an October 8 investors' conference, Boston's senior vice president Robert Selsam boasted of the company's success with City Planning, recounting how the firm had secured three complicated variances across five zoning districts that allowed it to maximize floors and footage. "The key," said Selsam, "is knowing how to effectively navigate the review and approval processes" of the city. He didn't, however, mention that he might have a bit of an edge at that game."

What we're seeing is just how the public interest has been traduced; and how it has been transposed, not only by Mike Bloomberg's own narrow class-oriented world view (something that he was able to effectively camouflage in his first term); but also by his dissemination of millions of so far untraced philanthropic dollars:

"Many New Yorkers have an eerie feeling now that Mike's money is literally everywhere and that a city, said to be for sale in the era of the big-time bosses, has actually been bought by a mayor so much bigger than they ever boasted of being. The richest man in New York is also, for the first time, the mayor of the city and one of its grandest philanthropists, making it almost impossible for the rest of us to talk to him without wondering at some level of consciousness: "Can I get a slice of this guy?" His personal and public outlays have flooded the city's bloodstream for years now, and few are so uninterested in a possible transfusion of their own that they will take him on."

And nothing underscores this tawdry subornation of democracy than the role played by Kathy Wylde, Jerry Speyer, and the NYC partnership in the coronation of the mayor; and a full detailing of how much all of these moguls have personally benefited from Mayor Mike's "public policy" decisions has yet to be catalogued (Barrett doesn't touch on the bennies that the Bobbsey Twins-Steve Roth of Vronado and Steve Ross of Related-have garnered during Bloomberg's tenure): "The fact is that under Wylde and Speyer's leadership, the Partnership is the closest thing we now have in New York to a political club with the clout to make a mayor. Of course, the Partnership sees itself as a civic association acting on behalf of us all, but Bloomberg has not just been good for business in the broadest sense—he's been especially good for particular businesses, like Jerry Speyer's."

And what we've come to expect in all of the shameless shilling for the mayor, is that the editorialists at the NY Times are always first in line when it comes time to check one's principles at the door. Barrett underscores the extent that the paper's publisher-with another of the billionaires, Shiller in Chief Steve Rattner, doing the enabling-dropped all previous objections to term extensions as his paper's finances flagged: "Sulzberger insists that the paper isn't for sale, but with the value of the family's controlling stock plummeting, a generous offer from a white knight like Bloomberg might be too much for some members of the Sulzberger clan to resist, making a third term for Mayor Mike a potential firewall protecting Arthur Sulzberger's ability to continue controlling it."

So the public service that Wayne Barret has done here is to lay out the template of just how clearly the "above politics" Bloomberg has acted like the most tawdry of Tammany pols; while at the same time ruling in the interest of the scions of his own class. All that's left is to begin the reportorial task of tracing the mayor's charitable giving in order to dramatize how his money has corrupted the democratic process,

But as far as Barrett's premise of a Bloomberg transformation, well, we'll have to part company there. The first Bloomberg term wasn't the masterful exercise in good government that Wayne believes it to be. Aside from the theft of the Bronx Terminal Market by Deputy Dan for the Related Company-with no public bidding-there was Bloomberg's complete failure to understand how to make city government more economical and efficient. The NY Post's editorial yesterday on the growth of the mayoral staff is just one case in point.

The simple fact here is that from his very first day, Mike Bloomberg has aided and abetted the growth of the size and scope of city government; and has done little to innovate so that we can do more with less and allow the city's private sector to flourish. Here's the primary misconception Barrett advances: "In his first term, he was able to close a gaping budget chasm without crippling city services by imposing the largest and bravest property-tax hike in history—and it sent his approval ratings plunging. When the city boomed again, this Nixon-to-China boldness by a businessman/mayor had forever refuted the knee-jerk right-wing orthodoxy that higher taxes invariably kill growth."

This theory misrepresents a painful reality that has been unmasked by the current fiscal meltdown. In fact, the city's recovery didn't "forever refute" any theory; it only proved that there can be an exception to any rule. The city's booming recovery came about because it was Wall Street generated-and generated by global forces that were immune to local tax policies. At the same time, however, as New York soared to the 49th worst state in the Small Business Survival Index, local businesses began to reel from higher taxes and regulatory fees. And with Wall Street down for the count, this high tax environment is crippling our economic comeback.

So from our standpoint, the "transformation" of Mike Bloomberg is less a dramatic revelation of a fallen hero, than it is an exposure of the generic limitations of someone whose money, and limited class-based world view, has been-from the very beginning-stymieing any creative policy making and governance reform. In the process, thousands of small businesses and the neighborhoods they serve, have been shorted by a Wall Street operator who believes that the world is defined from within the parameters of high finance; and the people who occupy the highest stratum of our class structure.

Barrett's citation of the original NY Times editorial opposing Bloomberg's first run for the mayoralty, should serve as an appropriate epitaph for this brilliant expose:

"Even within the annals of businessmen-candidates, he is ill-matched to the job he covets. His company has no stockholders and no unions. It is a brand-new business, its corporate culture and decision-making structure devised to suit his character. . . . Many of Mr. Bloomberg's greatest talents would turn out to be utterly beside the point." When the bursting collective bargaining, pension, and debt costs of the recent Bloomberg boom years are considered, the Times of old might have had a point. As it also had as recently as June 9, when it warned against a term-limits gambit and urged Bloomberg to seek another office: "We are wary of changing the rules just to suit the ambition of a particular politician."

Keeping Bloomberg After School

As Liz B points out, the coalition to combat the mayoral blank check on school governance is really gearing up for a major fight-something that Mayor Mike doesn't need as he continues to dose out the fiscal Castor Oil to New Yorkers. The various groups gathered to contest what they term, the mayor's "one man rule"

"Participants, who shouted "one man rule has got to go," deemed mayoral control a "failure" and announced the formation of the Campaign for Better Schools, which includes more than 25 groups like AQE, the New York Immigrant Coalition and the Coalition for Educational Justice, to fight its reapproval without changes. Elected officials on hand for the rally: Councilman Bill de Blasio, Sen. Eric Schneiderman and Sen. Kevin Parker. Schneiderman and Parker both voiced support for stronger public participation in education policy-making, which is an issue that Assembly Speaker Sheldon Silver has also cited (specifically, the need for more parental input) as a priority for his Democrat-controlled house."

Can't you just hear the late Marvin Gaye singing, "Let's Get it On?" We can feel the winds of change blowing, and that breeze is about to gust away the Bloomberg educational narrative-parroted by all of the folks on Mike's own personal dole. Gotham Gazette lays the issue out well:

"As the mayor's allies have marshaled his wealth and prestige to press their case, other key players -- teachers, parents, administrators, politicians -- stake out their positions. On Saturday, for example, the union that represents school principals and other administrators released a report calling for significant change in the current system. At the crux of this -- beyond the power, politics and money -- is the question of how well the nation's largest school system has served its students over the last seven years and what, if any, changes in governance would help the schools do better."

The key question comes down to: Who're gonna believe? That's because the mayor's rapidly reaching that Grouch Marx point ("Who're going to believe, me or your own lying eyes?") of no return-with the folks closest to the actual running of the system, parents administrators and teachers, debunking the mayoral spin.

And the severe budget shortfall will dramatically impact the debate: "Then there is the new budget reality. Between the implementation of mayoral control in 2002 and last summer, the school system's operating budget increased by 42 percent to $16.9 billion. Those additional funds may have papered over policy differences.Now with funding cuts looming, fights will almost certainly arise over what and where to cut, revealing other fissures.. This has already become apparent. Last week the Independent Budget office released a report, which concluded that the education department spent some $135 million last year on programs to assess and rate schools. Schools Chancellor Joel Klein defended the expenditures as "some of the smartest dollars we've spent." But Public Advocate Betsy Gotbaum, who requested the report, said, "I'd rather see cuts in the accountability initiative than cuts in individual school budgets."

Increased, and independent scrutiny, is not a palliative for the mayor's hopes; something that he's prepared to counteract with a multi-million spin job: "The fight over school control, coming just months before the 2009 mayoral election, will become inextricably tied to Bloomberg's re-election campaign. A private group, set up by close Bloomberg allies, has announced plans to raise $20 million for a public relations and lobbying effort aimed at preserving mayoral control. Meanwhile the mayor has indicated he could spend up to $100 million to win re-election -- and some of those millions of dollars in advertising will undoubtedly trumpet his actions on education."

In our view, however, the grass roots efforts for greater transparency and parental input will be hard to counteract. As the NY Daily News reports: "It's time to end one-man rule of our schools," said Victoria Bousquet of the Coalition for Educational Justice, who has two sons at Medgar Evers Preparatory School in Crown Heights, Brooklyn. "Mayoral control has not delivered results." Leaders of the campaign say they want to rein in the mayor's power to set policy and make budget decisions. They also want to get a clearer picture of the Education Department's finances."

It's gonna be the elite, and the mayor's media toadies, versus the folks. And with the mayor's image taking a beating, we don't believe that his credibility will go unchallenged, and ultimately destroyed. We'll give a student the last word on this sensitive subject: "Robert Moore, a 16-year-old student at Bushwick High School for Social Justice, said students and parents should have more say in how the schools are run. "In the current system, the mayor's voice is the only one heard," he said."

Sic Transit Gloria

We were heartened to hear that Leader-in-Waiting Smith had set up his transition team; it certainly makes sense to try to project an air of inevitability into what really is an unstable, and unpredictable situation: "Despite the fact that he's still trying to nail down the majority leader post, current Senate Minority Leader Malcolm Smith is steaming ahead with his plans to take control of the chamber come January. To wit: He just named the following members of his transition team..."

What strikes us most about the assembled crew of transitioners is that it appears they appear to be selected, in almost a caricature of Democratic governance, for their racial and geographic balance. Missing, in our view, are some serious folks who can analyze the depth of the crisis we're in; and, as a result, offer some creative solutions. No think outside the boxers for Malcolm.

But if we're really going to get a handle on the fiscal meltdown-and its budgetary implications-we are going to need to bring some unconventional thinkers to the task; instead of doing that, Smith has opted for a political roster that creates the impression of orthodoxy that lulls the faint of heart into somnambulance. That is, all except for our good buddy Sheinkoff, someone who never lulled anyone.

That being said, it might make more sense to actually assemble the 32 votes needed before assembling the drapery for the office of senate leader. And, we might also inquire; what will this transition assemblage really be working on? There doesn't appear to be an idea man or woman in the bunch.

Leadership and Budget Confusion

The fight over senate leadership is so confusing that there's even disagreement over what the rules say in regards to the choosing of a new leader. As the Times Union points out (via Liz): "A storm is brewing over what constitutes a valid election for Senate majority leader, and it could result in a clash unlike anything seen in the gold-leafed chamber in 43 years."

The Republicans and the Democrats are apparently on a totally different page: "Senate Republican lawyers, citing a passage in the state Journal Clerk's manual (last updated in 1970) dealing with the selection of a speaker, say a simple majority of the votes cast by those who show up to vote is all that's necessary. As things stand now, that would give Republican leader Dean Skelos the advantage over current Senate Minority Leader Malcolm Smith."

But the Dems, on the other hand: "They are completely wrong," said Mortimer Lawrence, Smith's chief of staff, who is also a lawyer. Senate Democrats say the majority of the Senate members must get behind one candidate — a higher standard than those simply showing up to vote. The Democrats base their interpretation on how many members must pass legislation."

All of which brings Alan Hevesi back into political relevance-at least for the dissertation he wrote over forty years ago: "First, Hevesi concluded that a senator can only become majority leader by gaining the majority of votes of the chambers members. That means Smith, whose Democrats will dominate the Senate in January, needs 32 supporters — three fewer than he currently holds due to the intransigence of the famous "Gang of Three": Senator-elect Pedro Espada and Sen. Ruben Diaz Sr., both of the Bronx, and Sen. Carl Kruger of Brooklyn."

But the TU never really says definitively what the rules are here-and the pending leadership chaos is manna from heaven for the senate rebels who continue to bust chops. Here's Liz'a portrait of the "Caucus of One": "Sen. Carl Kruger, perhaps best known these days as the the ringleader of the Gang of Three, will be in Albany for tomorrow's special legislative session, but, unlike his renegade-in-arms, Sen. Ruben Diaz Sr., he won't be caucusing with his fellow Democrats. That's not to say that the Brooklyn lawmaker, who is the only Democrat to chair a committee (Social Services) in the GOP-controlled house, will be taking part is closed-door Senate GOP meetings, either. "I'm caucusing with myself," Kruger said. "I have not been in a Democratic caucus for the better part of two years. I try to deal with a better class of people, I guess."

Kruger was sardonically referring to himself here-apparently Groucho Marx-like, at least as far as club membership is concerned. Kruger believes in a bipartisan approach, something that Malcolm Smith has belatedly discovered: "Their time might have been better spent trying to develop relationships that would have gotten some of our bills out onto the floor," Kruger said.
"That's what (Smith) now says he wants to do, ironically, run this as a bipartisan Legislature in a consensus atmosphere. That's something I've been trying to do for a very, very long time. It's amazing to me that at the eleventh hour, faced with the current circumstances as they are, he's decided to adopt that philosophy. I just wonder how long it will last."

But a spirit of bipartisanship certainly is absent from the current budget battle-an ominous sign for the governor who was forced to cancel today's special legislative session, As the NY Post tells us: "Outflanked by the lame-duck Republican majority in the State Senate, Gov. Paterson last night hastily delayed his call for an "emergency" budget-cutting session today and vowed not to move forward without a deal with the Legislature."

All of which bodes ill for the state, as gridlock on all levels leaves New York rudderless to deal with a severe fiscal crisis: "Paterson angrily labeled the GOP power play "a political game" that threatened the state's ability to weather the worst fiscal crisis in recent memory. "This is not a game," Paterson said. "If this state starts to fall into the same situation as California did, I want you all to remember this moment," referring to that state's recent announcement that government workers may have to take unpaid leaves."

According to Bill Hammond, it looks as if Paterson is gonna need a Plan B; but perhaps the senate Dems (as well as Dean Skelos) will need one as well. These are impasses that can't stand for much longer, or else we'll all be drowning together in red ink.

With Friends Like These

Malcolm Smith is generating a great deal of support for his leadership bid-but it's from gay rights activists who are more than likely to hinder the senator's efforts to cobble together enough votes to reach his goal. The reason, as Liz B points out, is that the gay rights pressure is sure to harden the Reverend Diaz's position: "Diaz is also the target of another kind of (probably unwelcome) attention from a new (and rather exhaustively-titled) Facebook page called "Stop a Marriage Referendum in New York: Malcolm Smith for Majority Leader."

The kind of in your face tactics that the gay groups are utilizing is a good way to solidify the base; but a poor method to win over opponents like Diaz-who represents a district where the strength of the gay rights movement is fairly non existent. And the anger at Diaz is definitely counterproductive for Smith: "Officers of the group include a number of well-known LGBT activists like Ethan Geto, Stonewall Democrats Matthew Carlin, Corey Johnson, and the page's creator, Jeff Campagna, a producer and activist, who wrote: "I am furious that the obstacle standing between us and marriage equality is a Democratic state senator named Ruben Diaz Sr., from the Bronx, who with his two friends Senators Carl Kruger and Pedro Espada Jr., also Democrats, is threatening to stand with the Republicans to block Malcolm Smith from becoming Senate Majority Leader in January."

The gay activists, seeing the results of Proposition 8 in California, are very concerned about the impact of a possible referendum; and are ready to go to war with the senator: "But Ruben Diaz Sr. isn’t just threatening to block Malcolm Smith from being majority leader. He’s so obsessed with gay marriage that he’s trying to figure out how to bring Proposition 8 to the ballot in New York...Maybe Senator Diaz thinks that we’re all going to let this pass and walk on eggshells as he plays power games with his Senate colleagues. We have before. Remember when we cheered the passage of a sexual orientation non-discrimination act that was stripped of protections for gender expression because we didn’t want to rock the boat?"

As part of the campaign on Smith's behalf, supporters of gay marriage are encouraged to contact Diaz's office: "Both on Facebook and at an anti-Prop 8 rally outside City Hall last week, Campagna urged gay marriage supporters to contact Diaz Sr. and urge him to support Smith. At the rally, he called on everyone present to pull out their cell phones and program in the senator's office number, which he yelled out from the podium."

And Diaz also took some shots from El Diario, whose advocacy on the gay rights issue probably puts it at odds with the majority of its readers; and the paper conflates opposition to gay marriage with a violation of the separation of church and state: "Rev. Diaz and others are supposedly not for denying rights to gays and lesbians but believe that marriage should be between a man and woman. Yet, it’s this very discriminatory position that serves to exclude lesbian and gay couples from obtaining the rights, benefits and standing that heterosexuals take for granted."

And further: "This use of religious beliefs to block basic civil rights undermines the separation of church and state in this nation. The basis of that separation lies in the experience of early American colonists who had fled religious persecution elsewhere to pursue tolerance, acceptance and freedom in the “new” world."

This argument totally misrepresents the fact that the Judeo-Christian ethic underpins a great many of our basic legal principles; and that fact has nothing to do with the establishment of religion. Arguing against a change in the law based on one's religious beliefs, however you see the relative merits of the law in question, is not a challenge to the separation clause of our constitution. In any case, it certainly is within the purview of the voters to weigh in on the question; and a referendum on this issue is as germane to democratic principles as the one for term limits.

But all of the effort to intimidate Diaz is likely to backfire; and the kinds of raucus public demonstrations that we've seen, are probably a poor way to advance the idea of gay marriage to folks like Diaz-and the many other New Yorkers who are not yet comfortable with the idea.

Bagging the Rebate Revocation: Send in the Clowns

Well it looks as if New Yorker City homeowners will be getting their $400 rebates after all. Just weeks after we were told that Mayor Mike Bloomberg's fiscal expertise was needed to save our city from ruination, a funny thing happened on the way to a city hall hearing-the mayor and his crack finance experts were exposed for their failure to simply understand the basics of New York State tax law.

As the NY Times reports: "Remember two weeks ago when Mayor Michael R. Bloomberg announced he was shelving the $400 homeowners’ rebate checks because the city could not afford them? Look for yours in the mail. It turns out the mayor does not have the power to halt the rebates, the city’s top budget official grudgingly admitted on Monday, under questioning from the City Council. Any elimination of the popular rebates requires City Council approval, budget director Mark Page acknowledged. And council members, who have been flooded with calls from angry residents looking for their checks, declared the mayor’s idea to cut them “dead on arrival.”

Perhaps the Bloombergistas should exchange their bond terminals for clown make up. As Clyde Haberman points out this morning, the city council has a degree of buyer's remorse when it comes to a mayoral third term:

"They were particularly angry at the mayor’s plan to save the municipal treasury $256 million by canceling $400 tax rebate checks that were supposed to have been mailed to homeowners weeks ago. It turns out that the cancellation needs the Council’s consent; that approval is as likely as your winning the Mega Millions lottery. Mr. Bloomberg and Mr. Page will have to figure out another way to scrape together the money. “This is just one of those ‘out of touch with reality’ moments that you guys have from time to time,” Councilman Lewis A. Fidler of Brooklyn said to the budget director, his voice laced with scorn."

As a result, Haberman simply can't resist the following observation:

"Just think: Only days ago, Council members were offering Mr. Bloomberg (and themselves) as New York’s salvation from fiscal doom. Ms. Quinn and Mr. Fidler were among the 29 council members who voted to amend the term limits law and thereby allow Mr. Bloomberg (and themselves) to run for an extra four years in office. Everyone knows that the only way they could pull off this self-serving rules change in midgame was to argue that the billionaire Mr. Bloomberg was uniquely positioned to lead the city, Moses-like, out of the fiscal wilderness. Now, on key matters of finance, they say the mayor doesn’t know what he’s talking about. There is a serious disconnect."

And on top of this demonstration of fiscal acumen comes this epiphany on plastic bag taxes-mayor no can do because, just like any other tax, this one needs both city council and state legislative approval (the trick of calling it a "fee" fooled no one). As the Times tells us, having to do its own quick rewrite of its story to reflect legal realities: "City officials are still fine-tuning the details of the surcharge: Which kinds of plastic bags would require one? Is 6 cents — 5 for the city and one for the merchant — enough? While Mayor Bloomberg has called the charge a fee that could be approved by the City Council, the city’s top budget official said on Monday that it was a tax and would require approval from the State Legislature."

All of which has Haberman slapping his knees in his appreciation of another demonstration of Bloomberg's indispensability in the economic hard times we face: "It also turns out that the mayor got it wrong in calling for a 6-cent charge on plastic bags in stores. He had called it a fee, which he and the Council could impose on their own. On Monday, Mr. Page acknowledged this amounts to a tax, requiring Albany’s approval."

Ah, deconstruction of a fable is sometimes so cruel; in this case the Myth of Mike as financial savior of NYC comes crumbling down, much like the falling statue of Saddam Hussein in Baghdad. As the Times reports:

"The revelation represented an unusual embarrassment for an administration that prides itself on precision and efficiency, especially coming weeks after Mr. Bloomberg based his successful campaign for an extension of term limits on his fiscal résumé. On Nov. 5, when he announced he was shelving the rebates, the mayor said that the move would save the city $256 million as it grapples with an economic downturn. The news about the rebates was not the only red-faced moment for the administration on Monday. Mr. Page also acknowledged that the mayor could not impose his much-discussed plan to impose a 6-cent charge on plastic bags without the approval of the State Legislature."

Which prompts Haberman to remind us that the down fall of Mayor Abe Beame came after his sloganeering about his own expertise became quite a joke when the last big fiscal crisis hit the city: "For his part, Mr. Bloomberg may not want to trumpet how well he knows the buck. That’s what Abraham D. Beame, then the city comptroller, did to win the mayoralty in 1973. “He knows the buck” was his campaign slogan. In no time, New York teetered toward bankruptcy, and “he knows the buck” became a punch line."

In reality, the mayor's ignorance on these two issues probably helped to save him-albeit temporarily, perhaps-from himself. Both the rebate refusal and the plastic bag tax are wildly unpopular with New Yorkers. That being said, he'll have to come up with additional tax proposals that will also probably strike the city's citizens in a similar manner. The result? A mayor, who prided himself as a non partisan expert, being exposed as an out of touch wizard hiding behind a curtain of hubris.

A Mayor Not Worth His Salt

Here we go again-Mother Bloomberg is back at trying to insure that we all are as healthy as we can be. According to the NY Post, the target du jour is now salt: "The city has come up with a plan to help you shake your salt habit, according to New York magazine. In a closed-door gathering at Gracie Mansion late last month, health experts and food-industry representatives were told about Mayor Bloomberg's next crusade - an effort to reduce the salt in processed food by 20 percent over the next five years, the magazine reports in this week's issue."

That's what we really like about the mayor; while the city's economy's in free fall, and folks are worried about their jobs, and the ability to pay the rent, Mayor Mike's focusing on people's diet-once again trying to tell New Yorkers how they should live their lives: "City health czar Dr. Thomas Frieden went as far as saying that high blood pressure, which is linked to excessive salt, is "the greatest public-health threat facing the city." He leaned on industry groups to sign on to the plan by the end this month, according to an attendee. Restaurateurs will be encouraged to join a "voluntary" initiative and that there won't be new regulations."

No, the city's greatest health threat is economic insolvency, and an economy that is about to hemorrhage jobs; so all of Frieden's hysteria over fast food needs to be put into some kind of perspective. Those neighborhood businesses, and the jobs they generate, are more integral to the health of the city than the regulatory impositions of an out of control Health Commissar. And we know what Frieden sees as "voluntary."

It's time to get these Nannys the old heave ho; and we believe that the continued health hectoring by the mayor and his minions will speed his already beginning political decline. Clearly, Bloomberg's a mayor who's not worth his salt.

The Battle Over Mayoral Control of the Schools

What's becoming clear, as the opposing forces gather to combat renewing the current version of the mayoral school governance contract, is that a great deal of effort will have to be made just to inform New Yorkers about the realities extant in the city schools-the press hasn't be a reliable ally to the folks on this issue, a fact that was underscored when a critical NY Daily News story was killed at the last minute.

In the fog that has accompanied the coverage of school governance issues, what remains hidden is the extent to which school performance lags substantially behind the bold proclamations of the Tweed PR machine (a lag that's dramatized by the gap in test score performance between city and national exams). When a system is run in such a top-down fashion, and when transparency is the exception rather than the rule, it's vital that the press function in a critical manner.

That kind of critical exposure should come from a well orchestrated campaign that involves parents, teachers and administrators-the folks with a first hand view of what's really going on in the system. Legislative hearings, white papers and press events where these first hand looks can be disseminated, can and will pierce through the veil of press complicity.

We're hopeful that the NY Times will replicate its growing role as Bloomberg watchdog in its coverage of the school governance question, Certainly, Jenny Medina's stories are a good start for the paper. Yesterday, she wrote about the Tweed grading system, and underscored how it tended to obfuscate rather than illuminate-especially for the parents it's supposed to guide in the making of choices for their kids:

"The A-through-F grading system for New York City schools is billed as a public information tool, helping people sort out which schools are teaching children and which schools are just moving them along. Instead of inscrutable education jargon and endless score charts, the letter grades act like billboards broadcasting achievements and failures. But for parents shopping for the best schools, the letter grades can obscure some of the most salient information, because they are determined largely by how much progress students make year to year rather than how well their skills stand up against objective standards."

The grading system is a product of the inordinately expensive accountability department that has been set up; a system whose sheer size and expense turns it's name into a bureaucratic oxymoron. And, as the Times tells us, the grading system is less helpful to the parents than it is to the managers: "The grades, which the city calls progress reports, are more performance management review than consumer report, blunt shorthand rather than nuanced evaluation. The fact that a school got an A is not necessarily a clear indication that parents should want to send their children to it."

The expensive nature of accounting services was revealed in an earlier piece that Medina did for the paper: "The Education Department is spending roughly $130 million this year to track the performance of schools in New York City, according to a report published on Thursday by the city’s Independent Budget Office...The report found that while private money initially paid for many of the accountability efforts, the same kinds of measures were increasingly being financed with city dollars. Many of the figures cited in the report had already been released, but this was the first attempt to detail the overall costs of Chancellor Joel I. Klein’s accountability efforts."

Of course, with the city's budget in shambles, the rising cost of bureaucratization-not to mention its effectiveness-is certainly going to become a hot political issue, and the Public Advocate has been all over it: "Ms. Gotbaum said during a news conference at her downtown office that because of the current state and city budget cuts, the Education Department should “re-evaluate the accountability system from top to bottom” to ensure that it is “cost effective and producing real results in the classroom.” “There are hundreds of millions of dollars that are being spent without real assurance that our schools are getting any better,” she said."

All of which underscores the extent to which accountability-reified in its own luxurious planet-may be divorced from the consumers who need to have the critical information necessary in making the proper choices for their children; in fact, this highlights the level of concern that Tweed has-as well as the esteem it holds-for parents as a group: “Judging schools on year-to-year fluctuations is like judging stocks just on quarterly reports,” said Clara Hemphill, the author of several guides to the best public schools in New York City. “I tell parents not to take these too seriously.”

The following Times passages in the latest Medina story, underscore the wide gap between a management and a consumer perspective:

"James S. Liebman, the Education Department’s chief accountability officer and the architect of the progress reports, says the problem is that the public rarely looks beyond the letter grade even though the reports contain a variety of other guideposts. It is possible, for instance, to see what percentage of the weakest students improved by at least one grade level, and what percentage of higher-performing students improved on state tests from one year to the next.


“What the parents want to look for in schools is to see how well they do with ‘a kid like mine,’ ” Mr. Liebman said. “All of that is in the progress report. There is a lot of information in there that is directly useful for parents if they take a look at it.”

A closer look, though, can often be confusing to the layman. At 14 of the high schools that received A’s last week, for example, fewer than two-thirds of the students graduated in four years. Students at the 113 A-rated high schools had median SAT scores of 1209 out of a possible 2400, a score that ranked in the 17th percentile nationally."

Kinda makes the grading system ineffective, doesn't it? At the same time it also demonstrates, in our view, the opaque nature of the entire Tweed enterprise; and this expensive opacity also makes it hard for elected officials, even if they have the requisite desire, to evaluate school performance. It is our measured opinion here, that the upcoming legislative review process will dramatically reveal just how much the school emperors have no clothes; and how absurd it is to consider Joel Klein for any federal educational post.

Mayor's Dangerous Slippery Slope

As we have been happily willing to point out, the deconstruction of Mike Bloomberg's mythic image as the non partisan steward of the public good-something that began in earnest with the term limits power grab-will now continue spiraling downward as the city's budget turmoil forces its attention on masses of average New Yorkers. In this vein, the NY Times' Michael Barbaro presented us on Saturday, as a public service, with another installment of, "How the Mayor Turns:"A year before the next mayoral election, Michael R. Bloomberg appears to have settled on his campaign message: higher property taxes, smaller school budgets, shuttered dental clinics, more parking fees and a new surcharge on plastic shopping bags. And by the way, he advises ordinary New Yorkers, buy fewer dresses and put off that new car."

The mayor believes that this Bloomberg brand of stern, uncompromising honesty, is just why the city needs him for an additional term: "It is a seemingly toxic sales pitch at a moment when the city’s economic engine, Wall Street, is imploding, thousands of jobs are disappearing and New Yorkers are on edge. But in persuading the City Council to revise its term limits law so he could seek a third term, Mr. Bloomberg cast himself as an economic white knight who is uniquely capable of leading the city through a steep downturn. And he is acting swiftly to fulfill that promise."

With a white knight like this, who could be frightened of a really malevolent leader? What Bloomberg's doing is taking a page out of his 2002 playbook-you know, grim candor mixed with higher taxes and fees-and believing that it can be utilized to successfully convince New Yorkers to retain its empathy challenged CEO: "Yet the severity of what he must do, the short time he has to accomplish it and his frequent lack of delicacy could threaten his popularity at a time when he needs it most. Already, New Yorkers are dialing up the city’s 311 information hot line and their council members’ offices to fume about higher property taxes."

And remember that in 2002, he had three years to turn the situation around-doing so with Wall Street cash that poured in as the financial sector took off-something that's just not happening in 2008. In effect, the Wall Street windfall masked the impact of Bloomberg taxes, levies that did long term damage to so many small businesses and neighborhood retailers (the disappearing supermarket is representative of the impact that the Bloomberg program had).

What the current crisis-and Bloomberg's knee jerk response-does, is to expose just how thin the mayor's government playbook really is. Imagine continuing to support programs subsidizing unwed mothers-costing close to half a billion dollars-while homeowners get stiffed on their property tax rebates.

Once this kind of Lindsay-like approach becomes clear to the voters, the mayor's grip on the popular will will slip way beyond his grasp. As Adam Lisberg pointed out yesterday in the NY Daily News: "And some of his opponents say the mayor - even with his billions - may be more vulnerable to a challenge next year than conventional wisdom holds. "A lot of people are starting to think there's more than one outcome here," one Council member said, pointing to Obama-mania, the surge in new black voter registrations and a term limits backlash. "That means they'll stop acting like there's only one outcome here."

And, as the Times tells us, it has already begun in earnest: "He is going after the middle class to cover the budget, and it bothers me a lot,” said Mordy Roman, the owner of a liquor store in Brooklyn. “In hard times I don’t see this going over very well with people.” And the fight over school governance hasn't even started yet.

On top of the cuts, there's the stoppage of the $400 rebate; certainly a drop in the bucket compared to other extravagances in the municipal budget, this mayoral move is really beginning to gall the folks: "So far, however, the mayor’s economic decisiveness is not exactly winning over New Yorkers. Just days after engineering the change to term limits last week, Mr. Bloomberg infuriated thousands of homeowners by stopping the city from mailing out an annual $400 property tax rebate, which many families rely on to buy holiday gifts or pay winter heating bills. The move would save the city $250 million — a fraction of the city’s $60 billion annual budget, but the mayor said it was a prudent step."

We need to recall that the mayor's initial taxing foray drove his approval ratings, George Bush-like, into the twenties; and the overriding of the popular will on term limits has given the voters a very different take on the mayor's mien:

“People are starting to get really annoyed with him,” said Jayson Levitz, a homeowner in Queens, who had been waiting for his $400 rebate check. “He is so arrogant that he feels only he can handle this meltdown. But it does not take a brainiac to increase taxes.” Mr. Levitz, who said he voted for Mr. Bloomberg in 2001 because “the city needed a business person,” now hopes to see the mayor defeated. Jeanette Didio, a homeowner in Brooklyn who is currently unemployed, called the city’s hot line to plead for her rebate check, without which she cannot pay for a visit to the dentist, she said. “I don’t think this mayor realizes that there are people more needy than others,” she said. “I need that money.”

The mayor's minions plead nolo contendre: "Edward Skyler, deputy mayor for operations, said that with the city facing a budget shortfall of $4 billion over the next two years because of lower tax revenue, the mayor “has no easy options in front of him.” “We saved for a rainy day, but instead we are in monsoon season,” he said. “The depth of this emergency means there are no longer any sacred cows.”

Apparently excepting the $433 million for housing the unwed mothers. Big Ed doesn't understand just how little Mayor Mike has understood the need to devise economies and efficiencies in government; abjuring these measures for feel good lavishness on municipal labor and social spending. Now, given the current crisis, all he has left is to bring knives to a gun fight.

Still, the Bloombergistas mistakenly feel that the same old song will get all of us dancing again: "Mr. Bloomberg has played the role of the clear-eyed C.E.O. of New York City before: after the Sept. 11 attack, when as a new mayor he cut spending and sharply raised taxes. His political advisers are convinced that just as they did back then, voters will initially grouse but ultimately reward the mayor for tough, popularity-be-damned decisions in the middle of a crisis."

In our view, this is less likely to happen today-people are less willing to afford the mayor any benefits of doubt; and his arrogance will exacerbate the slow and steady decline of his popularity: "In 2002, Mr. Bloomberg, a billionaire former businessman, seemed perfectly poised to lead a recovery — he was the anti-politician and he did not need the job. Now, after a bruising battle for the chance to remain in office for a third term, some of those qualities seem tarnished, or at the very least, undercut."

All of this is underscored by Bloomberg's world view-“We are a high-tax city,” Mr. Bloomberg said. “We expect to get something for it.”-and his failure to really get the historical lessons of the 1970s: "Aides to Mr. Bloomberg said he was unperturbed by the political ramifications of his economic proposals, which he considers vital to steadying the city’s finances. Mr. Bloomberg has repeatedly refused, despite the unpopularity of taxes, to simply cut his way out of the current budget woes, a mistake he says was made in the 1970s, when crime soared and garbage was piled high on city streets."

Here he falsely conflates really essential services with the pork ridden bloatedness of his contemporary budget. Big Ed's response underscores the seriousness of the mayor's problem: "Some critics of the mayor have suggested that he is addicted to taxes, and has been shy about taking on daunting budget burdens, like union pay and benefits. But Mr. Skyler, the deputy mayor, said, “It’s hard to argue that a mayor who is proposing fewer police officers and the elimination of a property tax rebate is making decisions based on politics, rather than the best interest of the city.”

But it isn't hard to argue that the mayor's decision making-and his limited world view-demonstrates his trained incapacity to deal with the fundamental problems that the city faces. So he's acting apolitically, does that makes his political actions correct? In Skylar's Bloomberg-colored glasses, not responding to legitimate political forces, and acting as if they don't matter, is the sine qua non of statesmanship; when in reality, it only demonstrates to us tone deafness and leadership limitations.

Councilman Vinny Gentile, the original opponent of the mayor's first property tax hike gets the final word on this-one that we believe could become the mayor's epitaph: "Councilman Vincent J. Gentile, who represents Brooklyn, said that scores of residents had pleaded with him to fight the mayor’s tax proposals, especially the elimination of the $400 rebate, which he called “a lifeline” for the working class. “People are just holding on by their fingertips,” he said, adding that the Bloomberg administration “has a tin ear when it comes to the concerns of everyday New Yorkers.”

Vendor Hearing Chaos

If anything could convince you that the city is clueless when it comes to regulating street vending, Friday's City Council hearing would have done the trick-the city agencies in charge who testified acted as if they had gotten off at the wrong station; barely acknowledging the eight bills on tap for discussion. As the NY Times reported:

"The first two hours of the hearing were taken up with discussion on those measures, including testimony by officials from the Department of Consumer Affairs, the Department of Health and Mental Hygiene and the Police Department. But then the hearing veered off course when Shari C. Hyman, the mayor’s deputy criminal justice coordinator, spoke. She said that the Bloomberg administration wanted to change state law to require the fingerprinting of people arrested for unlawful vending — a means of cracking down, she said, on unlicensed vendors who unfairly compete with licensed vendors, crowd sidewalks and endanger pedestrians."

Unable to come to grips with-let alone comprehend-just how chaotic the city streets have become in some neighborhoods, the administration simply went off on an irrelevant tangent; prompting angry responses from council members: "You say you don’t like any of the bills in any shape or form and you just want to talk about your bill, which you never introduced?” Councilman Leroy G. Comrie of Queens, who led the hearing in his role as chairman of the Consumer Affairs Committee, asked Ms. Hyman. “This is incredible,” said Councilman Charles Barron of Brooklyn. “You’re just talking to us about fingerprinting and not addressing any of the issues, whether it be police harassment or overcrowding.”

Or the fact that the legal vendors are operating illegally and hurting thousands of neighborhood retailers. Michael Murphy from the Restaurant Association, testifying with us at the hearing, put his finger squarely on the problem: "Representatives of the restaurant industry, which sees itself as competing with the food vendors, disagreed. A member of the New York State Restaurant Association, Michael Murphy, said: “This proposed intro is a direct threat to thousands of neighborhood retailers who are struggling in an era of rising rent, higher taxes, and increased regulatory abuse.”

And the Times also relates testimony from our labor allies: "John Durso, president of Local 338 of Retail, Wholesale and Department Store Union/United Food and Commercial Workers, cited similar economic factors, saying food vendors selling produce could hurt grocery stores. “The proliferation of these carts near established food stores, combined with the downturn in the economy, have resulted in the expected closing of six stores where we represent workers, five in northern Manhattan, one in southern Queens.”

Just so. That is why we are working with our business, labor and community coalition to draft real enforcement legislation that will address the wild west nature of the situation. During hard economic times, with stores closing in unprecedented waves, shifting business to the streets is not only asinine, it also exacerbates an already dire situation; underscoring once again, how out of touch the Bloombergistas are with neighborhoods and small business.

State History Lesson

In Saturday's NY Post, Andy Wolf outlines the historical background to today's battle for control of the NYS Senate: "After a 43-year stretch in the wilderness, New York Democrats have finally won control of both houses of the state Legislature. Or have they? A look back into history may give the Republicans a bit of hope. The last time the Democrats won both houses, they managed to botch things so badly that they lost control of the Senate in just one year and control of the Assembly four years later."

Over forty years ago, a deadlock in both houses of the legislature saw the leadership fight drag on through the month of January until a bipartisan compromise broke the logjam. The deadlock occurred because newly elected senator Robert Kennedy tried to impose his will-and his own choice-in the leadership struggle:

"The new senator was challenging the leadership of the man who was then the state's most powerful Democrat, New York City Mayor Robert F. Wagner Jr. In Kennedy's eyes, there could only be one top dog...Day after day in January 1965, neither group of Democrats could muster a majority of votes for their candidates. But Wagner had an ace in the hole, which he finally played in early February. He enlisted Gov. Rockefeller's aid to bring Republican votes to his candidates, thus allowing the GOP to have the final say on the Democratic leadership."

As Yogi Berra would say, it looks like deja vu all over again-with three rebels Dems poised to perhaps use their Republican colleagues to prevent Malcolm Smith, the leadership heir apparent, from assuming power: "On paper, at least, there will be two more Democrats than Republicans in the Senate come January. But an odd coalition of three renegade Democrats threatens that victory. One switch means a tie and entry into uncharted waters. Two defections would mean a Republican restoration - victory snatched from the jaws of defeat."

The longer the three can hold out, the more likely it would be that some alternative to Smith would have to emerge-unless the governor wants to see total gridlock while he tries to get New York out of its worst financial situation since the Great Depression. And, at least according to the Post's Fred Dicker, this isn't someting that would greatly trouble him.

Here's Dicker's report in this morning's column: "It's "anybody but Skelos" for Paterson when it comes to electing a new Senate majority leader in January, and that includes another Republican. While Democrats have won majority control of the Senate for the first time since 1964, it's a narrow, 30-32-seat majority that is being threatened by a "Gang of Three" Democrats who are negotiating with Skelos. Paterson publicly favors Minority Leader Malcolm Smith (D-Queens) for majority leader, followed by Sen. Jeff Klein (D-Bronx), but sources say he would be content if Skelos' well-liked GOP rival, Sen. Tom Libous of Binghamton, won the post.
"Just anybody but Skelos," one source said."

As Wolf points out: "But there is a lesson here for Republicans and Democrats alike: Expect the unexpected, especially in the political swamp that is Albany." The turmoil continues.

Premature Exclamations

We've been following the Padavan recount closely, so much are we enamored with chaos theory. Therefore it comes as a surprise to us that our good friend Evan Stavisky is commenting, at what almost seems to be an hourly basis, on the paper ballot canvassing. Here's his comments on the Politicker: "Frank Padavan’s vote-leads continue to plummet faster than the Dow under George Bush," he said."

In these kinds of situations it's always best to remain circumspect-at least until the end results are somewhat clearer. Otherwise, you run the risk of being foolishly premature.

Tax Indians Now!

Governor Paterson really has no choice-he must move immediately to enforce the law on the taxation of Indian retailers. As the NY Post editorializes this morning: "Who knew the special interests opposing Gov. Paterson's budget cuts had it so easy? All they need to do to stop the gov dead in his tracks is . . . threaten to sue. That, at least, is the message Paterson is sending with his latest punt over the scandalous flow of illicit cigarettes from New York's Indian reservations - a trade that's costing New York hundreds of millions in lost tax dollars."

With a budget defict in the billions, how does the governor explain to all New Yorkers that he can't collect millions owed to the tax payers because he's afraid of being sued by Indians? Or is it something else that he is afraid of? "Sure, someone will sue if he tries to collect the tax - but bogus lawsuits follow any state action of consequence. Then again, Paterson can't exactly admit the real reason he won't go after the revenue - that he fears more of the Indian violence that followed then-Gov. Pataki's attempt to enforce the tax. Pataki, to his shame, caved in; now Paterson must live with the precedent. But Pataki was wrong, and so is Paterson. How the latter can leave hundreds of millions on the table, given Albany's fiscal condition, is a mystery."

And it's really a very simple collection process-just tax the product at the source, before it even comes into the state: "And the only reason the state is currently barred from enforcing the tax is that the governor ordered his tax agents not to print the vouchers needed to exempt tribal smokers."

All of the constitutional reasons for not taxing Indians were resolved in litigation brought by then AG Oliver Koppell over a decade ago. As the Post points out: "But the Supreme Court ruled more than a decade ago that states have the right to tax cigarettes sold on reservations to non-Indians - tribal nonsense about their "sovereignty" notwithstanding."

This failure is, as we have pointed out countless numbers of times, hurting NY's small businesses and now it's the state's tax payers getting shafted big time-which is why the City of New York (and our client John Catsimatidis)has brought suit against a Long Island tribal tax evader. Not one program should be cut until these taxes are properly collected.

Gang of Three Continue to Vex

The so-called gang of three continues to cause a stir. In this morning's NY Post, the paper highlights the Latino empowerment issue being pushed by the three rebels: "Two rogue Democrats say Gov. Paterson encouraged them to push for a Hispanic as Senate leader, even as he was publicly backing Sen. Malcolm Smith - an African-American - for the job. Sen. Ruben Diaz Sr. and Senator-elect Pedro Espada Jr. told The Post that Paterson told them that having a Hispanic leader in the Senate would boost his re-election bid."

The governor's office has denied this, but since it injected itself directly into the squabble yesterday, calling the three senators "selfish," it has put Paterson squarely in the middle of the muddle. As Senator Diaz told the Post: "We were just following Gov. Paterson's lead," said Diaz (D-Bronx). "Gov. Paterson indicated to us in a certain way that it would have been a benefit to him that a Hispanic be the leader, because that would help him in 2010."

In addition to the Latino angle, the issue of gay rights is also still front and center-with the Times Union chiding the rebel senators(via Liz): "The idea that the Legislature will someday address same sex marriage as the matter of civil liberties that it is seems more remote than ever.
Here are two senators and one senator-elect, all New York City Democrats, calling for a public referendum on the issue of gay marriage, instead. Sen. Ruben Diaz of the Bronx, Sen. Carl Kruger of Brooklyn and Senator-elect Pedro Espada of the Bronx see gay marriage — and whether New York is ever to allow it, as Massachusetts and Connecticut do — see the battle for control of the Senate as a convenient opening to press their issue."

This doesn't sit well with the paper, apparently allowing the public a say is an anthema to the elite: "Mr. Diaz, for one, says he'll only back a majority leader who promises not to bring a same-sex marriage bill to the floor for a vote. The referendum he and the other would-be renegades are advocating won't be a constructive plebiscite at all. A means to an end is more like it. Same-sex marriage wouldn't be considered in the interest of the 19 million or so New Yorkers, or even the much, much smaller minority who might want to engage in it. Three politicians have taken the issue hostage. They have every right, of course, to oppose gay marriage. Let them vote against it then after thoughtful debate, when it comes before the Senate. This isn't the way to decide what party will hold the Senate majority, however."

We like the word "plebescite." It has a nice fascist ring to hit; conflating giving the folks a voice with authoritarian bullying. Whatever! It still all means that the leadership question is no ready to be resolved, and the role of the governor needs to become more constructive than it has been so far.

School Accounting Miasma

As the Gotham Gazette is reporting (and why wasn't there anything in the press about his?), there seems to be little fiscal accountability in the DOE's so-called Office of Accountabilty: "The Department of Education spent about $135 million on its cherished accountability initiative last year, according to an Independent Budget Office report released today. While such a number — most of it going for central office expenses, not teachers and classes — looms large in an era of cutbacks, at a press conference this morning Public Advocate Betsy Gotbaum, who requested the report, and her staff seemed more focused on what that figure does not include — and on the reaction from the department — than on the bottom line figure."

Gotbaum has been doing a yeoman-like job at questioning the DOE's efforts on all fronts-almost with a complete press blackout; and certainly without any adequate follow-up from the reporters who are assigned to examine how well our schools are functioning. What's significant in regards to the accountability folks, is how hard it is to get any clear picture on what's being done: "The spending, estimated to come in at around $105 million this year, includes progress reports, surveys and money paid as performance bonuses to school and principals. The largest chunk — $29 million last year — was for the schools’ controversial ARIS computer system."

What is clear that the effort is management and technology based-and the further you get away from educational variables the less all of this makes any real sense; an exercise in baffling and bamboozling by bureaucrats: "According to Gotbaum and her staff, department officials have stalled on providing information since the IBO started work on the accountability initiative report last February. It seems apparent that the department, which has boasted of cutting costs in administration to spend more in classrooms, wanted as little attention paid to this as possible."

All of which sets the stage for the big battle over mayoral governance that will certainly roil the legislature next year; with an emphasis, we hope, on a cost benefit analysis of not only all of the extra administrative spending, but the impact of all the additional outlays on performance in the classroom. Gertrude Stein's comment about Oakland seems relevant to the accomplishments of our Tweed folks: "The trouble with Oakland is that when you get there, there isn't any there there."

Vexing Vendor Battle

AS NY1 is reporting, the City Council will be facing a street vendor battle today, as a number of bills will be discussed at a hearing of the body's consumer affairs committee: "Street vendors hawking their wares on busy city streets seem as much a part of the fabric of New York as the city's sky scrappers and yellow taxis. But there is a fierce fight underway over the size of the industry, with the city council scheduled to hold a hearing on bills that would change the volume of street vending in the city."

One bill in particular, Intro 324, would lift the current cap entirely: "We want to see that the cap is lifted and give us some elbow room so we can function," said Grace Aydin of the Street Vendor Project. Brooklyn Councilman Charles Barron has 11 co-sponsors for this bill to lift the cap on street vendor licenses to 25,000. He calls the current restrictions absurd." The cap is currently 4,000.

What this all sets up is a battle between those who want to flood the streets with peddlers, and those neighborhood retailers, labor and community groups represented by the Alliance, who are concerned about the impact of the current complement of vendors-let alone an additional 20,000 or so-on the small businesses and the neighborhoods that they serve. The Alliance's coalition will be holding a press conference today at city hall at 12:30 (advisory attached).

Put simply, communities and small businesses are under siege-with bankruptcies on the rise; it's not the time to increase the non tax paying peddlers on the street to unfairly compete with the stores. We need to develop policies that enhance, not impede small store growth.

Intro 324 is based on a false premise; as we say in our legislative memo:

"This proposed Intro, is a direct threat to the thousands of neighborhood retailers who are struggling in an era of rising rents, higher taxes, and increased regulatory abuse; it is a bad idea built on a false premise. The rationale for the legislation states: “Vending not only adds to the commercial and cultural value of the City, but also provides vendors the opportunity to be self-sufficient, work legitimately, and support themselves and their families. Vending has historically enabled those with few or no other economic options – such as recent immigrants and small business entrepreneurs – to realize the American dream of advancing themselves through their own hard work, and to provide their children with greater opportunities than they had themselves.”

The reality is that neighborhood retailing, and the wholesale suppliers that distribute the goods sold in neighborhood stores, have provided recent immigrants with tremendous opportunities-ones that have been taken advantage of, as the roster of neighborhood store owners is filled with the names of immigrant entrepreneurs. Vendor proliferation threatens these store owners, while at the same time threatening the city’s tax base in a period of economic meltdown.

The basic problem with all of these bills is one of enforcement-or rather the lack of any real enforcement effort, particularly on the veggie peddlers operating brazenly right in front of retailers selling the same goods. As we will tell the council today:

"There is so little enforcement being done by the city, that the current crop of licensed food cart peddlers aren’t being regulated-particularly when compared to the oversight regimen that local food stores are subjected to. The way to insure the health of the city’s citizens is to create the kind of economic climate where green grocers, bodegas, and supermarkets, are able to flourish in the over 250 city neighborhood shopping strips."

What needs to be done is to craft legislation that will create a dedicated enforcement unit of the DCA amd DOH in combination. This needs to be done so that we can begin to create the kind of health business climate that will nurture store growth and an increase in local employment. Currently, New York State is ranked 49th on the Small Business Survival Index, an indication that high taxes and over regulation stifles business success here. Peddling simply adds to the list of burdens.

Press Advisory
Small businesses, labor and community leaders protest peddling laws

When: Friday, November, 14, 2008

Where: City Hall Steps

Time: 12:30 PM

On Friday, November 14th, a diverse coalition of community, labor and small business groups will gather on the steps of City Hall, along with selected elected officials, to protest the peddler anarchy that exists on the streets of New York. The press conference comes on the heels of a City Council hearing on a slew of bills that address the peddling issue.

Unfortunately, from the standpoint of the coalition, all of the pending legislation fails on one key point: there is no attempt to create the kind of enforcement mechanism that can protect communities and their businesses from peddlers that ignore the law with impunity. As Sung Soo Kim of the Korean American Small Business Service Center says; “Our neighborhood businesses are under siege, with bankruptcies and foreclosures at an all time high. Small retailers need to be protected from a proliferation of non taxpaying merchants that set up shop, often directly in front of struggling businesses.”

From a labor perspective, many of the neighborhood supermarkets that have union work forces are seeing business transfer from the stores into the streets; and the peddlers are often not entrepreneurs, but workers who are peddling under extremely adverse conditions.

On the community side, residents of many neighborhoods from all over the city complain about dangerous pedestrian traffic situations caused by peddlers who clog the streets and contribute to the decline of a neighborhoods quality of life. The entire coalition believes that the city needs to create a dedicated enforcement agency so that the current rules are enforced. Without such enforcement, any changes in the existing peddling laws are useless.

The group is particularly concerned with Intro 324, a bill that would lift the current cap on the number of peddlers in the streets. Such legislation would increase the chaos that already exists. As Steve Barrison of the Small Business Congress points out; “Certainly, a rational enforcement system needs to precede any additions or tinkering with the current laws.” The group is working on drafting such enforcement legislation.

Contact: Richard Lipsky (914-572-2865)

Just Keep Digging

According to Liz B, the efforts by Malcolm Smith, and to a somewhat lesser extent Governor Paterson, to inveigle the independent Dem senators to come home to momma, could use a little bit more finesse; particularly when it comes to the sensibilities of Ruben Diaz: "Gov. David Paterson and Sen. Thomas Duane didn't help Malcolm Smith's bid for majority leader with their recent attacks on members of the so-called Gang of Three. One top Senate Democrat told DN Bureau Chief Ken Lovett that Sen. Ruben Diaz Sr. had been ready to commit to Smith before hearing that Duane had called him a "bully" earlier this week during an interview with the DP."

And, of course, Paterson exacerbated the situation with his comments yesterday: "Things got even messier when Paterson later that day ripped into the Gang of Three, saying their refusal to commit to a leader is due to "selfishness." Just what David needed when he's being shot at from all sides.

So as of now, with Padavan/Gennaro hanging by a thread, Diaz and the to other senators are still the three amigos. As Diaz told Liz: " would not break my commitment (with Kruger and Espada). It's solid. I will stand solid with them until(we) three decide what we're going to do. The vote will be in January."

Budget Chaos

The governor unveiled his proposed budget cuts yesterday-and just couldn't find a dance partner anywhere. All of the state's legislative leaders-present and possibly future-remained mum; indicating that they'll have to be dragged kicking and screaming into any budget deal. As the NY Daily News tells us this morning, chaos lies ahead: "The hard part will be persuading a Legislature - deeply beholden to special interests - to put taxpayers first when they meet next Tuesday to deal with the budget crisis. The feeling around the Capitol on Wednesday ranged from nothing getting done next week to lawmakers doing just the bare minimum.
In other words, his chances are slim to none. "He might have reached too high. This could blow up in his face," one Senate Republican said. A top Democratic aide said getting just one of the governor's proposals through so quickly would be a heavy lift, let alone a slew of them.
Complicating matters is the chaos engulfing the Senate."

If the senate finds itself unable to make a leader before January-and who knows how the Padavan recount will end; his lead is now 502-the senior chamber will be unable to convene, let alone act: "Senate Republicans come into next week's session as a lame-duck majority and may simply decide to punt the problem to the Democrats come January. Meanwhile, Senate Democrats are embroiled in infighting over who will lead the chamber beginning next year. The Assembly won't do anything if the Senate isn't onboard."

Even with the leadership resolved, however, the battle will be tough. Hank Sheinkoff lays this out clearly: "Veteran Democratic consultant Hank Sheinkopf said the governor must show he's prepared to stand firm. "The governor's job is to lead people through the crisis. The Legislature's job is to protect interests," Sheinkopf said. "They're going to have a clash, and the only way it gets solved is in the court of public opinion."

All of which makes Paterson's intransigence on collecting the tax from Indian cigarette retailers that much more puzzling. As we and others have made clear, there may be close to $1billion in revenue ripe for the taking, but Paterson isn't budging. If this fight's gonna be won in the court of public opinion, that the legislature certainly has one issue that it can hold up against the frugal Paterson. When things such as day care, and programs for youth and seniors are being cut, the governor will look pretty silly protecting the rights of buttleggers; a well placed PR campaign would be appropriate as well as effective about now.

If he fails to take properly bold action on this one issue, all of the editorial boostering of his fiscal probity will begin to ring false: "Meanwhile, the special interests who own the Legislature are marshaling to defeat Paterson's plans to cut billions from Medicaid and school spending. Certainly, any cuts that come out of the special legislative session he has called for next week will be due entirely to Paterson's having forced the issue. But don't count on much...Experience, creativity, energy and toughness are essential if Paterson is to be successful."

The Pitter Paterson of Little Feet

The governor has opened up a certain can of worms with his accusation that senate rebels were being selfish for their failure to support Malcolm Smith. As the Politicker reported yesterday, this didn't sit well with Senator Diaz, who told Azi (who got the meeting dates somewhat confused) that the governor was actually supportive of the Gang when they met right after the election: “He could have stopped this and said, ‘It’s Malcolm.’ He didn’t say that,” said Diaz. “He expressed dissatisfaction of Malcolm and said politically, it’s better for him if there was a Hispanic” as majority leader."

Now the governor took umbrage with this and denied any complicity: "A spokesman for the governor, Errol Cockfield, strongly denied Diaz’s account, of the meeting, or that the governor expressed any criticism of Smith. “That’s completely false. The governor said no such thing to Sen. Diaz,” wrote Cockfield in an email. The governor has also criticized the group, following the meeting, calling them selfish."

But another of the Gang, Senator Pedro Espada, had this account: "Another attendee at the meeting, State Senator-elect Pedro Espada of the Bronx, said the governor was asked, hypothetically, whether he’d support a qualified Hispanic candidate for Majority Leader. “And the answer was ’Absolutely yes.’ We did not want to focus on the shortcomings of Malcolm Smith,” said Espada. He went on to say that during the meeting, there was “not any denunciation of Malcolm Smith.” But Espada said Paterson did not try to stop the group from continuing their search. “There was zero, I repeat, zero effort to stop us.”

It's probably not the best of times for Paterson to get embroiled with an internecine fight in the legislature-not with the almost universal condemnation of his budget cuts that we're hearing from all over the political map. And on that front, here's what Diaz fired away at the governor with: "Sen. Ruben Diaz Sr., who has been the subject of Democratic derision for being a member of the Gang of Three and refusing to pledge loyalty to Senate Minority Leader Malcolm Smith, is slamming Gov. David Paterson for proposing budget cuts that Diaz believes "will directly hurt the most needy communities."

And Diaz wasn't finished challenging the governor's own Democratic credentials: "We as Democrats have fought for these services for our communities, and that is why I can’t, I shouldn’t, and I will not give my vote to my Democratic colleagues in the State Senate to approve these cuts proposed by Governor Paterson which will directly affect the residents of my community," Diaz Sr. said. "We are not blind or deaf to the fiscal reality of the City, State and Nation. However, every time there is a fiscal issue, we cannot continue to balance the budget on that backs of the Hispanic, African-American and the neediest communities of the State."

So in calling the three senators "selfish," the governor was violating the political Hippocratic Oath of, "Do no harm." This is another fight he didn't need to take on when he'll be taking "incoming" from all sides. Diaz's retort seems designed to place the governor-at least ideologically-squarely in a Republican/Conservative camp: As a Democrat, I have fought for more and better services for our senior citizens, I have been the only Democrat, who in defense of our children’s education, has asked publicly for the resignation of Chancellor Joel Klein and Deputy Mayor Dennis Walcott, I have fought for and brought affordable housing developments to my senatorial district."

So now everyone waits the Padavan recount, and if the senator's vote margin holds, chaos is almost guaranteed to follow; with a leadership stalemate threatening to cripple any government action. The governor's "selfish" statement was impolitic at best, ans possibly disastrous given current circumstances.

Paterson and "Selfishness"

In this morning's NY Daily News, Governor Paterson lashed out against the "selfishness" of three rebel senators unwilling to back the leadership push of Malcolm Smith: "Gov. Paterson ripped as selfish a group of three rogue Democrats threatening to stop Malcolm Smith from being named majority leader. At a time when the state faces a fiscal crisis, the three are more interested "in a fight over personal luxuries" that Paterson called a "superfluous type of selfishness that's gotten us into this mess in the first place."

Hold on there Guv, ease up on the caffeine. If we're not mistaken it's the current leadership (and the interests that rule Albany) that has developed a case of lockjaw in the face of Paterson's request for a list of things that should be cut to allay the state's budget mess. As the NY Post opines this morning in its admonition to the governor to get tough: "Gov. Paterson today presents his package to plug New York's gaping bud get deficit - but the unions and special interests that run the Legislature have already made plain precisely how they view his efforts. That is, with condescending contempt."

Just how the leadership fight can be segued into the governor's battle with an intransigent existing leadership is beyond us; in fact it was Senator Kruger who made it plain that his interest in the leadership fight involved a concern for the tax payers and small businesses of the state. We think that David should be more concerned with those who will fight him tooth and nail on budget cutting, than those who could prove to be his more natural allies.

As Senator Espada (the News mistakenly ordained him) told the News: "We have been elected to our positions," the Rev. Pedro Espada Jr. said. "The governor hasn't been elected to his yet, but he seems to make a point that we somehow don't count. We were elected to vote and the vote takes place in January, not November."

And, as the Times reported this morning, the three rebels will be developing a series of position papers that stake out their interest in, not only addressing the state's budget problems, but in reforming governmental processes as well. The question of who's best to lead the senate will hinge to a substantial extent, on the person who can best reflect the compelling needs of the state: "Mr. Kruger said that his group would be consulting with experts to come up with their own platform and then to decide which potential leader could meet their standards. Mr. Espada and Mr. Díaz have said that they expect the Democrats to control the chamber next year, but Mr. Kruger said on Tuesday that both Mr. Smith and Dean G. Skelos, a Long Island Republican and the current Senate majority leader, “are two individuals that have not necessarily taken themselves out of the running.”

All of which may well hinge on the results of the Padavan-Gennaro recount. If the incumbent loses the race, than the dynamics of the challenge become more difficult. We'll just have to wait and see.

Independents Hold Firm: Call For Gay Rights Referendum

As Liz is reporting, the three independent Democrats who have refused to support Malcolm Smith for majority leader, met in the Bronx yesterday and recommitted to their independent status: "After a lengthy late-afternoon meeting, members of the Gang of Three remain united with no immediate plans to follow the lead of their erstwhile compatriot, Senator-elect Hiram Monserrate, who endorsed Senate Minority Leader Malcolm Smith for majority leader over the weekend."

In addition, the three also announced that they would be advocating that the entire issue of gay marriage be submitted to the voters in a referendum: "The biggest news to come out of the get-together, which took place at an Italian restaurant on Arthur Avenue in the Bronx, is that the three Democrats - Sen. Ruben Diaz Sr., Sen. Carl Kruger and Senator-elect Pedro Espada Jr. - are calling for a referendum, rather than legislative action, on gay marriage. "Basically, they said if Malcolm thinks term limits changes should be decided by referendum, then why not gay marriage?" said a source close to the three."

At the same time Tom Duane, the leading proponent of the gay rights measure, came out swinging when Liz caught up with him yesterday-calling Senator Ruben Diaz a "bully" for his threats on the issue: "Sen. Tom Duane today accused Gang of Three member Sen. Ruben Diaz Sr. of being "a little bit of a bully" on same-sex marriage and said the Bronx Democrat is mistakenly working under an old model of how the Senate works by casting this as a make-or-break issue in the leadership battle. "It's absurd that Sen. Diaz thinks he can bully his way on this issue," Duane said. "That is just not the way the government is going to be in the new Senate."

But that's assuming that the leadership is firmly in Smith's hands-something that won't be known at least until next Friday when the three holdouts have pledged to reconvene. Certainly, there doesn't seem to be any namby pambies among the group-as Espada's comments to Liz indicate: "It's not about Malcolm or (Dean) Skelos. In fact, those two candidates may not be around as contenders for the leadership by the time the vote gets taken in January."

So the Duane agenda is currently on at least a temporary hold; while the senator waxes poetic about what to expect after the budget's put to bed: "Duane, the Senate's only openly-gay member, who has carried the marriage bill since 2001, toed the party line by saying that the first priority of the Democratic conference is to fix the state's fiscal crisis. Everything else - from rent regulation to Paid Family Leave to marriage - has to take a back seat for the foreseeable future, Duane said. "We'll get to all of them after the budget," the said. "It doesn't matter whether it's a gay family or a straight family, if someone can't make a living in New York State, they're not going to live here. I'm confident the Democratic agenda will move forward, but first we have to fix the economy."

Clearly, all of these messy issues and situations are a long way from any immediate resolution. And with the Republicans caucusing tomorrow in Albany, perhaps we'll see even more chaos coming into the mix. As Liz says: "They certainly have a lot to talk about."

Man Bites Dog

According to the NY Post, the city council is prepared to challenge the mayor if he unilaterally rescinds the $400 rebate program for city homeowners: "A showdown between Mayor Bloomberg and the City Council is brewing, with the mayor planning to rescind the $400 homeowner property tax rebate without the council's approval - setting the stage for a battle in the courts. Council members insist the mayor needs their approval to yank the popular rebates.
"A local law would be required to eliminate the rebate, so the council would have to amend the local law, enacting legislation," said Jamie McShane, spokesman for Council Speaker Christine Quinn."

At last!-from supine to sublime; we can only hope. But, as we said yesterday, this is not only about process. The rebate program is designed to ease the burden on some of the city's most taxed residents-its homeowners; and the $250 million a year that the rebate represents is dwarfed by some extremely questionable welfare initiatives such as the one that Heather McDonald cited in yesterday's New York Post-a $433 million a year expenditure on housing for single mothers.

As McDonald pointed out: "The $433 million for the "homeless" family-housing program goes to a mere 8,800 families, or .34 percent of the city population. On average, those 8,800 families cost taxpayers $31,000 annually per family. Yet the mayor says that the city can't afford a $400 property-tax rebate for working households." What the council needs to do is to examine the budget closely for items like these-tax payers shouldn't be forced to support expensive social welfare programs at any time; but especially not when the city is planning on raising property and personal income taxes.

The juxtaposition here underscores just how Potemkin-like the mayor's image as a fiscal guru really is; programs such as these should have been replaced by more frugal responses that didn't actually encourage folks to behave in ways that lead to rewards from over burdened tax payers. Bloomberg's entire mindset, however, precluded the kinds of economies and efficiencies in government that are now going to have to be implemented on an emergency basis if the city's solvency is to be protected.

It's as we've said on any number of occasions; Bloomberg's philosophy of government is very John Lindsay-like. In the past seven years, little in the way of innovation has been proffered, and lavish spending has been the norm in too many cases. His re-bureaucratization of the schools-with a budget that is 79% higher than before he arrived, is characteristic of the Bloomberg model.

The Wall Street windfalls of the past few years are gone, though, and now we're faced with a harsh reality that the mayor is ill equipped to deal with in any creative way. It only dramatizes just how much the mayor's advertised success has rested on the hard work of his predecessor-and the influx of cash from the finance sector. It's really time for him to step aside for a more savvy and innovative chief executive.

Waste Not, Want Not

While the Billionaire Boys Club has lionized Mike Bloomberg as the indispensable fiscal maven NYC needs in these dire economic times, there's ample contradictory evidence that Mayor Mike isn't necessary the right man for the ongoing job of getting the city out of its mess. Some of the evidence can be gleaned from Heather McDonald's insightful column today in the NY Post.

McDonald demonstrates the way in which the spending habits of the Bloombergistas has the redolence of a bygone era-particularly the ill-fated fiscal reign of J. V. Lindsay: "The city also needs to get out of the welfare business and concentrate on the core function of urban government: providing the public infrastructure that allows individuals to seize opportunity. Over the decades, New York has created a host of welfare programs that are unique in the nation, the product of litigation by well-organized poverty advocates. Those programs transfer onto government responsibilities that in the rest of the country are borne by family and civil society. For a select number of putative victim groups, City Hall acts as father, extended kin or friend, at an astronomical cost to the taxpayers."

What kind of money are we talking about? Let's take a look at spending on the so-called homeless: "A prime example of counterproductive largess is the city's housing subsidies for unmarried mothers. Reducing them would free up money that could be used to protect public safety or reduce taxes. This year, New York will spend a mind-boggling $433 million to provide free housing for families claiming homelessness, virtually all headed by single mothers. That's on top of the nearly $200 million the city spends on "homelessness prevention"- cash grants and lawyers' fees for fighting eviction suits. No other US city offers this entitlement."

Are there better alternatives to these kinds of expenditures? "Are these alleged homeless families really homeless? Here's a test. After a hurricane or other natural disaster wipes out people's homes, the Red Cross opens emergency shelters for the newly homeless - dormitory-like facilities that people who otherwise would have no roof over their head gratefully accept before they move on to the assistance of family and friends. Such group accommodations aren't what the city means by "homeless-family housing," however. Homeless-family housing in New York consists of a free private apartment with kitchen and bath, in which the average single mother stays nearly a year."

Here's a better, and more cost effective approach; one that doesn't encourage the kind of dependence that Bloomberg seems to meekly accept: "If single mothers claiming homelessness were offered Red Cross-type group accommodations, rather than their own apartment, the number of families trying to enter the system would drop precipitously, as would the length of stay. Many young women claiming homelessness have alternatives to free city housing, such as continuing to live with their own single mothers or moving in with friends. Those alternative accommodations are undoubtedly crowded and less than ideal. But a less-than-ideal housing arrangement isn't the same thing as no housing at all."

Think of the savings to the tax payers-and to some of the programs that have a greater utility to New Yorkers: "To put that $433 million in perspective, it's nearly a third of the $1.5 billion in spending cuts that Bloomberg proposed last week and almost twice as much as the cost of the $400 dollar property-tax rebate that the mayor wants to eliminate. That property-tax rebate - costing $256 million annually - helps hundreds of thousands of hard-working New Yorkers. The $433 million for the "homeless" family-housing program goes to a mere 8,800 families, or .34 percent of the city population. On average, those 8,800 families cost taxpayers $31,000 annually per family. Yet the mayor says that the city can't afford a $400 property-tax rebate for working households."

This is what we mean when we say that the mayor's vaunted expertise is much like the reproductive equipment of the "Master of the House, who, according to his less than doting wife, "Thinks he's quite a lover but there's not much there." When the mayor cancels homeowner rebates and the new police class, but leaves programs such as these alone, who can defend his indispensability?

Update

And than there's the plastic bag tax. As Assemblyman Dov Hikind highlights: "Bloomberg is essentially saying, ‘Look, we can possibly generate $16 million with this scheme, so the public be damned,’” said an incensed Hikind. Wall Street’s meltdown has already cost New York State 160,000 jobs, and the Mayor just yanked the $400 City property tax rebate out from under struggling homeowners. “While Bloomberg is busy seeing green, New Yorkers, especially in my district, are seeing red.” Hikind said. “How does the Mayor expect New Yorkers to have any cash to spare when people are already overtaxed and overburdened?”

Dissension Shoe on the Other Foot?

According to an item in the Ithaca Journal (via Azi), Malcolm Smith might not be the only one experiencing internecine sniping. It appears that the name of Senator Tom Libous has emerged in the discussion of the ongoing leadership fight. The story, written before Monserrate defected, tells us:

"That would mean that the “gang of four,” as this quartet immediately became known, could hold the balance of power between the two parties. Conceivably, they could all cast their ballots for the current Republican majority leader, Dean Skelos, to remain in the top job next year...One story going around is that if the group does decide to flip to the Republicans at some point, they would require the GOP to dump Skelos, who has been feuding with Paterson, in favor of Thomas Libous of Binghamton, now No. 2 on the GOP food chain and better liked by Democrats."

So, all of those who enjoy chaos should be really happy-especially if both conferences get embroiled in leadership struggles. The more this happens, the greater the leverage held by the dissenters from Smith's coronation.

Will It Suit Them?

A wide range of plaintiffs have signed on to the Randy Mastro-orchestrated federal law suit against the term limits extension. As City Room reports: "Elected officials, aspiring politicians, public interest groups and average citizens who voted to establish term limits in New York in the 1990s filed a federal lawsuit [pdf] Monday morning challenging the constitutionality of a law signed by Mayor Michael R. Bloomberg last week that extended the limits from a maximum of two terms in office to three."

This finally lays down the legal gauntlet, and if the opposition gets traction with this, all political hell will certainly break loose. Ironically, as the NY Post points out, one of the lead plaintiffs, former Staten Island BP Guy Molinari, has been a good friend of the mayor; but he parts ways with him here on principal: "This is a mockery of the word democracy," Molinari fumed. "When I think back to the days when I was fighting with the Marines in Korea . . . people would say, 'We're here to defend our democracy.' "

And the suit itself hits hard at the self serving nature of the actions by the mayor and the council. As the Times relates: “Allowing a self-interested mayor and City Council to dismiss the results of two recent referenda undermines the integrity of the voting process, effectively nullifies the constitutionally-protected right to vote, and perniciously chills political speech by sending the unavoidable message that the democratic exercises of initiatives and referenda can be disregarded by public officials,” the complaint states."

The idea that this gives the folks more choice is subjected to justified ridicule: "The lawsuit points out that in the past decade, only 2 of 107 incumbent council members lost a re-election bid. It also highlights Mayor Bloomberg’s many statements in favor of term limits over the past few years, as when he deemed some council members’ calls for a change to term limits “disgraceful” and criticized a proposal to resubmit the issue to a third referendum by saying, “I think the public has spoken twice and they’ve spoken quite clearly. I don’t know that you should keep shopping for a different answer.”

And the presence of Bill Thompson's name on the lawsuit may belie the conventional wisdom that the comptroller really has no stomach for taking on the mayor. As Liz B points out: "Thompson issued the following statement on the lawsuit: “Today's court action is necessary to correct an injustice. We are stepping forward on behalf of those New Yorkers who were denied a voice when self-interest prevailed over the public good. Today’s action aims to restore democracy to this process.”

The final word here goes to one of the blog's commenters: "Mayor Bloomberg keeps getting sillier on a daily basis. If he keeps being so open about being an opportunistic spoiled brat, that believes with his billions he can buy what ever he wants, then I’m not sure if a 100 million bucks will be enough to buy him an illegal third third next year."

Malcolm's Gay Pride Goeth Before the Fall?

According to the NY Post, Senator Ruben Diaz has drawn a line in the sand on gay rights-withholding support from anyone who can't give him a written guarantee on not moving legislation in this area: "Gay marriage emerged as a central issue in the fight for control of the Senate yesterday, after a key lawmaker vowed to withhold support from any leader who would push to legalize same-sex nuptials. Sen. Ruben Diaz Sr. of The Bronx - one of three rogue Democrats threatening to spoil the party's hard-fought rise to Senate dominance in January - called on Democratic leader Malcolm Smith to pledge publicly not to advance the issue."

This puts Smith, who has said that economic issues are his priority, on the hot seat-particularly since the gay rights groups have spent lavishly to change the leadership of the senate: "The Assembly voted last year to legalize gay marriage, but the bill died in the Republican-run Senate. Gay groups donated heavily to Democratic Senate candidates this year."

With Diaz holding out, and Senators Espada and Kruger remaining firmly arrayed against Smith, the senate is potentially rudderless: "Democrats gained at least two seats in the 62-seat Senate last week, potentially giving the party a majority for the first time since 1965 and toppling the Republicans' last outpost of statewide power. But celebrations have been postponed by Diaz and two other dissident Democrats - Sen. Carl Kruger and Sen.-elect Pedro Espada Jr. - who have exploited the chamber's expected 32-30 split to set terms on its leadership. Diaz, a Pentecostal minister, has frequently broken with the Democrats on social issues. The other two renegade Democrats have enjoyed cozy relationships with Republicans amid feuds with their party."

All of which exacerbates the fiscal showdown that will commence with the governor's special session next week. Diaz, for his part, doesn't trust the verbal assurances from Smith-believing, no doubt, that verbal contracts aren't worth the paper they're printed on: "Just give it to me in writing that you will not bring the gay marriage to the floor and you got me," Diaz told The Post."

Still, even if Malcolm is able to get the gay groups to go along with the Diaz demand, who does the Reverend go to for redress if Smith, or any other leader, goes back on his word? And even with Diaz in the fold, the Dems remain two votes short. As one Albany insider told the NY Daily News' Bob Kapstatter (no link found): If Malcolm doesn't find a way to bring Kruger and Espada into the Dems tent, "He's screwed."

Fiscal Challenges Roiled By Leadership Stalemate

The upcoming special session in Albany called by the governor should prove to be quite frustrating-at least if Paterson believes that his partners in government are going to step up and help him resolve the current fiscal mess. The bleak forecast makes for a wide range of unpalatable choices.

As the NY Times tells us: "Gov. David A. Paterson said in an interview on Sunday that he would almost certainly seek billions of dollars in cuts to Medicaid, as well as midyear reductions in school aid, to address New York’s worsening fiscal condition. He also said he expected to urge labor unions to reopen the contracts they have struck on behalf of public employees as a way to avoid or decrease layoffs."

We keep wondering, who's David's partner for this marathon dance? It gets worse: "Some of the cuts will be sought when lawmakers return to Albany on Nov. 18 for a special session to help close a $1.5 billion budget gap for the current fiscal year, which ends in March, and to get an early start on next year’s budget. Any cuts would need support from the Legislature. And the governor will have to propose far steeper cuts when he introduces a budget next month for the fiscal year that ends in March 2010 — that budget will need to close a $12.5 billion deficit."

Current senate leader, Dean Skelos, has drawn his own line in the sand; and don't expect Malcolm Smith to lend a hand while he's still searching for enough votes to insure that he's lead the majority: "Dean G. Skelos, the Senate majority leader and a Long Island Republican, has vowed to block education cuts in the Nov. 18 special session — “New York State must not balance its budget by offloading its costs to schools,” he said recently, and he has been hailed by teachers’ unions for ruling out such cuts."

Bill Hammond weighs in this morning in the NY Daily News, chiding legislative leaders for cowardice: "Gov. Paterson must feel a bit like Gary Cooper in "High Noon" these days.
He's doggedly trying to round up a posse to stand up to the special interests and face down the state's massive budget deficits. But members of the Legislature are pulling down the shades and cowering under the barstools."

When asked, state lawmakers couldn't give the governor any cost cutting recommendations: "The state burns through more than $120billion a year, yet the people we elect to the Assembly and Senate did not come up with one dime that was being wasted or misspent." No one seems to want to take on the powerful in this fight. As the NY Post reminds us: "Gov. Paterson's plan to slash state spending by $2 billion next week came under pre-emptive attack yesterday from public-employee unions, hospital workers and the hospital industry itself. The critics claimed Paterson, who has yet to detail the cuts he'll seek at an "emergency" legislative session next Tuesday, should cut state spending in other areas, raise taxes, or look for a federal bailout."

Leadership uncertainty exacerbates Paterson's problems. As the Times points out: "But Democrats won 32 of 62 seats in the Senate in Tuesday’s election, winning a majority for the first time in more than four decades. Three Democrats, however, have yet to commit to supporting the Senate minority leader, Malcolm Smith, a Queens Democrat, as majority leader when the new Legislature is seated in January. That leaves the Senate’s leadership uncertain at an inopportune moment."

And the NY Post chimes in on this point: "Gov. Paterson is heading for his first major defeat, as lawmakers appear likely to reject his $2 billion in proposed state spending cuts aimed at containing a ballooning budget deficit, The Post learned yesterday. Senate Majority Leader Dean Skelos (R-Nassau), smarting over last week's loss of majority control to the Democrats, may even refuse to take up Paterson's budget-cutting request at the "emergency" session called by the governor for a week from tomorrow, sources said."

The problem here lies with the fact that Skelos doesn't need to have Republican fingerprints all over the drastic cuts: "And by waiting until January to take action, Skelos could leave Democrats with all the blame for what are expected to be widely unpopular budget cuts. That is assuming his uphill efforts to persuade two Democrats to defect to the GOP side in order to keep Republicans in control are unsuccessful."

Which means that the next few weeks and months aren't gonna be easy for the governor to navigate-as the forces start to gear up to fight his moves to greater austerity: "The two largest areas of state spending - school aid and Medicaid/health care - are among the most popular programs with state lawmakers, who receive millions of dollars in campaign contributions from the teachers and hospital-workers unions, as well as from the health-care industry itself.". As Governor Paterson battles all of the most entrenched Albany interests, it's likely to get very lonely at the top.

The Rich Public School Tradition

When people talk about the rich public school tradition, we don't believe they're referring to the following story, by Meridith Kolodner, that was killed by the editors (for some "unknown" reason) over at the NY Daily News. It seems that there's a wealth of expertise over at the old Tweed Courthouse:

"While family income for most kids attending public school is well under six figures, at least five senior DOE advisers had salaries and investments that totaled between $1.7 and $6 million each last year, financial disclosure records show. That's in addition to multimillion-dollar homes and the odd BMW and boat. Some parents are concerned. "It exposes a degree of insularity in this administration," said David Bloomfield, a parent member of the Chancellor's Citywide Council on High Schools. "It lends credence to the charge that the most powerful people in the school system are out of touch with average parents."

So why did the story get spiked? Well, according to the NYC Public School Parents blog: "After a slew of negative revelations about the way Tweed botched the Gifted and talented admissions process so that it became much less diverse, schools have remained hugely overcrowded, they are paying through the nose for personal couriers and consultants, and the $80 million supercomputer ARIS that is a massive failure and waste of money, one wonders why the extreme sensitivity on this particular issue?"

What concerns us is that the News would stoop to censoring this. The issue of misfeasance at Tweed has been covered fairly well by the paper's reporters; as well as by the intrepid columnist Juan Gonzales. With Mort's paper turning tricks on term limits, it doesn't behoove the News to kill stories that are critical of the Bloombergistas school governance reign.

Checks and Balances in Government: The Case of the WFP

In an earlier post, we worried about the excessive influence of the Working Families Party on the Dems in the state senate. Some may take this as a hostility on our part to the WFP; nothing could be further from the truth. Our view is that healthy government needs strong checks and balances, and that a more moderate senate is in the interest of the majority of New Yorkers-particularly the neighborhood retailers that the Alliance has always fought for.

At the same time, however, we have lauded the WFP for its role in the Bloomberg term limits debacle-here checks and balances is on the other foot; with a billionaire mayor running roughshod over democracy, and small business and labor are left sucking hind teat. The WFP is standing strong here on behalf of the folks, providing the balance against anti-democratic impulses and forces.

In addition, WFP has also been a strong ally on the ant-Wal-Mart/box store fights; so it's clear that our position vis a vis the party is not based on any ideological implacability to WFP-it depends on the issue and the venue. Clearly, they have a healthy role to play in the interplay of interests in both NYC and Albany.

Fencing With Diaz

As Liz tells us, Senator Ruben Diaz is giving an inch: "So far, the Gang of Three is hanging tough.
Sen. Ruben Diaz Sr. released a statement this morning intended to "clear the air and avoid any misunderstandings" in which he declared he remains undecided on the Senate leadership question and doesn't plan any announcements until after he meets with his fellow gang members tomorrow."

The hang up? As we have been saying, the gay rights issue is paramount for Diaz, as he underscores in the press release issued this morning: "I have not committed myself to anybody, and my position as an ordained minister and a pastor will not allow me to support any would be leader that will bring gay marriage to the Senate floor." And Diaz wonders why this makes him into a bad Democrat.

As Azi points out: "In our conversation, Diaz tried to paint himself as an independent, principled Democrat, not unlike Democratic State Senate Leader, Malcolm Smith, who Diaz remembered breaking with the party during the 2005 mayoral election. “They didn’t call Malcolm Smith a Republican when he crossed Freddy Ferrer and endorsed Michael Bloomberg for re-election,” Diaz said."

Bell Tolling for New York's Tax Payers

With the news that the cash-strapped MTA is contemplating tolling the East River bridges, it's time for the city's tax payers to get ready for an all out assault on their wallets. As the NY Post wrote yesterday: "In a report expected on Gov. Paterson's desk next month, members of the Ravitch Commission - a 13-member panel appointed in June to identify solutions to the agency's financial crisis - will recommend collecting tolls at all or some of the city's East River."

Needless to say, this isn't going over well with many New Yorkers: "The very idea of new tolls on the Brooklyn, Manhattan, Williamsburg and 59th Street bridges leaves many motorists and business people sputtering mad. "That will kill us for sure," said Marie Vitten, manager of Exclusive Lighting on the Bowery, who called the proposal "ridiculous" and said she would lose customers."

Marcia Kramer underscores the popular mood: "That's crazy," said Alex Shaw of the Bronx. "We're taxed enough. They've got to get the money from someplace else. Stop putting it on the motorists." Added James Yglesias of Brooklyn Heights: "You can't punish us for driving." "For me, it's not good," said Jorge Morena."

But under the cover of a tolling of the bridges lurks that old mayoral favorite-congestion pricing. As the NY Daily News tells us: "Both City Hall and Albany would have to approve the wallet-busting plan because the city owns the four bridges and the Metropolitan Transportation Authority is a state agency. A source revealed that Mayor Bloomberg's full congestion pricing plan is also back on the table."

It almost makes you want to see the mayor run for a third term-just to see if millions will trump grass roots anger. But the plight of the motorist is the tip of the tax iceberg. The plans of the mayor and speaker don't stop there-with property and income tax hikes looming large on the city's political horizon.

This doesn't sit well with the Manhattan Institute's Nicoole Gelinas, who writes the following in the Wall Street Journal: "Last week, Mayor Mike Bloomberg announced a grim update to New York City's $60 billion budget. To meet falling revenues he proposes spending cuts and property-tax hikes, and he may increase income taxes by 15%."

This doesn't bode well for the city's economic prospects, especially as the financial sector shrinks-perhaps permanently: "Today, things are different. The financial-services industry could be at the beginning of a long-term correction that will leave profits much lower than they had been. Wall Street's business model -- of taking ever bolder risks with shareholders' and lenders' money and reaping fees from ever-more-complicated proprietary financial products -- now appears to be dead. Consequently, high finance may shrink as a share of the national economy and the city's economy, not just temporarily but for a decade or more.To plan for this risk, the city needs to respond with structural spending reform and tax policies that create new revenue sources."

Unfortunately, this kind of reform agenda is alien to Mayor Mike; and his response to the budget crisis could well be a cure worse than the disease-with higher taxes slowing even further the economic growth the city vitally needs. The Wall Street fall off is just that severe, and even finance will be sensitive to a high tax environment:

"To understand just how dependent upon Wall Street New York City's budget has become, consider these facts. Two years ago, a third of all the wages and income in the city came from the finance, insurance and real-estate industries, up from just a quarter a decade earlier. The securities industry alone was responsible for a quarter of wages, up from 17% from a decade earlier.

The city also depends on its top 1% of earners -- many of them tied to the financial industry -- for nearly half of its personal-income tax revenue, up from 41% from last decade. The financial sector provides more than a third of business taxes. Last year, Wall Street bonuses alone comprised 8% of the city's personal income. In 2000, the peak year for tech-bubble bonuses, they comprised 6.6%."

The trained incapacities of this mayor leave him clueless to do the kind of innovative things that the city government needs to respond to the seriousness of the crisis we're in. Innovative in business, Bloomberg has been pedestrian in his approach to governance. That posture was able to be sufficient as a Wall Street post 9/11 revival overcame the mayor's tax hiking, and economy slowing, proclivities.

Times are radically altered today. Tax hiking, and toll impositions on motorists, is exactly the wrong response-something that the city's voters are starting to understand. As Gelinas warns us: "The city has to change. Right now, it can do so willingly. In two years, it may not have that luxury."

Update

The NY Post chimes right in on this theme this morning in the paper's lead editorial:

"At the same time, Bloomberg's plan to hike taxes yet again is most disappointing: On property taxes, he's immediately canceling his $400 rebates and phasing in a 7 percent tax hike sooner than planned. Plus, he's pumping up fees and levies in other areas as well. It's risky: The city's tax burden is not too low, but too high. Raising it further will do little to help local businesses, or to keep folks employed, or to bolster a sagging economy that produces the very revenues Mike seeks. Still worse, the mayor has floated the idea of an income-tax bump of as much as 15 percent, should it become necessary in the coming months. If that's his starting point, don't even think about how large the final number will be after the big-time tax-and-spending pols get done with it."

Campaign Finance Farce

The NY Times is up to its old editorial legerdemain-advocating campaign finance reform while supporting candidates that abuse it with impunity. In yesterday's paper, we read the following plea to Mayor Bloomberg to abide by a finance law that everyone knows he has absolutely no intention of adhering to: "After two elections in which he campaigned with more than $150 million of his own money, this time he should comply with New York City’s excellent campaign finance system, which would limit the amount he could spend on his third campaign."

Give us a break! If the Times genuinely felt that this was an overriding and compelling issue, it should have made it so before agreeing to support the mayor's bid to overturn the term limits law. Now the paper just appears to lack any real seriousness; and does anyone think, should the mayor run and spend like a drunken sailor, that the Times won't line up behind him alongside the rest of the billionaire press corps?

Principles should matter, but the Times adheres to them only when it is politically expedient. Did the Obama campaign's trashing of the public finance system cause the paper's enthusiasm for the Democrat to dampen? And did the paper say anything about the questionable online money grabbing that disabled any real credit card prevention?

If it did, we missed it. Imagine if that had been done by a Republican; all of the Times would have gone into a journalistic jihad. Hard to take folks like these seriously when they pontificate in such a skewed, and partisan fashion.

Bag Dad Bloomberg

The brouhaha over the plastic bag tax is ratcheting up, and the furor is helping along the deconstruction of the mythic image of Mayor Mike; people are really beginning to view the mayor differently, and there not liking what they see all that much. As the NY Daily News reported Saturday: "Mayor Bloomberg's proposed nickel-a-bag tax on plastic shopping bags may not sound like much if you're buying a quart of milk - but try shopping for a family of eight.
"It's crazy!" said Eric Mcloud, 34, as he loaded two carts full of groceries into a livery cab outside the Atlantic Center Pathmark in Brooklyn Friday. "You've got to buy the food, and then the bags to put the food in, too!"

As we've said before, the plastic bag tax is both a symbolic as well as a tangible example of the reason why supermarkets are disappearing in NYC; the city never fails to find another reason to tax or regulate the grocery business-with little regard for the impact. A nickel here, a nickel there; it all begins to add up. And what most New Yorkers don't get to see is how all of the hidden taxes and regulations get passed on. Mr. Mcloud, however, sees the bag tax clearly" He and his wife, Dahlia Espada, 37, have six kids - and a $500 grocery bill every two weeks. Each shopping trip generates 50 double-bagged plastic sacks, which would cost them an extra $5 - plus a $1 handling fee for Pathmark."

But the mayor says we need to see this, like the cigarette tax, as something that transcends narrow economic interest. As the NY Post related: "It's not the money, it's the environment, Mayor Bloomberg said yesterday in defending his proposal to impose a tax on plastic bags. "That's like having a cigarette tax," argued the mayor. "The most wonderful thing in the world would be if we collected nothing from our cigarette tax. Think about how many people's lives you'd save."

Conflating lives saved by not smoking with long term land fill issues is pretty silly. Isn't it? And the relative merits of paper over plastic bags is debatable. What's not is that this tax joins the long list of such levies that make the cost of doing business so high in New York. With supermarkets closing all over the city, shouldn't the mayor be looking to reduce overhead for these vital retail outlets?

And don't buy the idea-advanced by Bloomberg own environmental guru-that it will be simple to monitor the plastic tax: "Mayoral aides pointed out that no decisions have been made on how the tax would be collected or even which establishments would be affected. "What if you're in Macy's and get a plastic bag? If you eat at a white-table restaurant and take food home in a bag, would that be taxed?" explained one aide. About a billion plastic bags a year are used here, which would generate $50 million at the nickel-a-bag rate."

As the News tells us: "Bloomberg's environmental experts have proposed to enforce the tax by allowing stores to charge an extra penny per bag, bringing customers' tab up to 6 cents each. They have not said which stores would be covered, in a city that uses an estimated 1 billion bags a year." We're sure there are clever bureaucratic minds already at work on this.

There's no doubt an army of inspectors and regulators in waiting here-waiting to catch some unsuspecting bodeguero for non compliance; to fine him____? A number yet to be determined. But what does Mike care? When's the last time the mayor shopped for his own groceries?

But, as we've noted, the deconstruction process is well underway, and the choice between paper and plastic may actually be seen as a choice to hire someone with more sensitivity to the plight of average New Yorkers: "Meanwhile, a Daily News poll found that 68% of those who responded are opposed to the charge. Keep it up Mike.

Yankees Si, Bloomberg No

With all of the furor over corporate malfeasance roiling our national political debate and stimulating calls for accountability, it's important to point out that we have one of the best examples of shifty business accounting practices right here in NYC-and, no, it's miles away from Wall Street-up on River Avenue in the Bronx.

As Juan Gonzales has tirelessly pointed out, the Yankees, a franchise worth upwards of $1 billion, have been cheating New York tax payers for years: "The Yankees improperly deducted more than $11million from their annual rent bill for Yankee Stadium over a four-year period, city Controller William Thompson has found. Thompson, who will make a formal announcement about the Yankee bill today, said the team has agreed to pay it all back - with interest. The richest franchise in baseball overstated expenses by more than $24 million from 2003 to 2006, which allowed it to underpay its rent bill on the city-owned stadium, Thompson's year-long audit found."

So while these masters of the House that Ruth built have been, "rooking the guests, and cooking the books," what has our corporate maven down at City Hall been doing in the way of oversight? Jim Dwyer's follow up to Gonzales in Saturday's NY Times is instructive in this regard. The current sleight-of-hand is really chump change; and the mayor appears to have bent over, with his drawers around his ankles, when it comes to the Yankees: "But these are appetizers before the true banquet: The subsidies for the construction of new stadiums and garages that come in hard cash, in the loss of public parkland and in forgone taxes. Earlier this week, The New York Times reported that the state and the city would cover at least $659 million in costs related to new stadiums for the Yankees and the Mets. The teams will receive an additional $480 million in tax breaks of one kind or another."

Now, as Dwyer recounts, we're all aware of how Rudy's jock sniffing was costly to the tax payers-and Bloomberg did cancel out some of the Giuliani excesses; only to add his own it seems: "Over the next few years, Mr. Bloomberg proceeded to slather new layers of icing atop the Giuliani cakes. The stadium plans were reborn, richer than ever. As a result, on Saturday, there will be one of these hokey quasi-religious ceremonies moving home plate from the old stadium across the street to the new one. This happens the same week that Mr. Bloomberg says he has to close health clinics, shut libraries one day a week, not hire a new class of cops and raise property taxes."

Can you say corporate welfare? And we'd be remiss if we didn't credit Battina Damiani and Good Jobs, New York, for all of that group's work in exposing this malfeasance. Assemblyman Richard Brodsky's work has also been sterling on this issue.

Now the counter argument here is that these "investments" will pay off. Dwyer wonders: "The premise of these sports stadium investments, public officials say, is that economic development benefits will roll into the city over the decades — $40 million over 40 years in the Bronx, for instance.Perhaps this will happen. Or maybe it is a hallucination that is even flimsier than the assumptions that drove Wall Street to sink trillions into financial instruments that no one actually understood but all the right people agreed were worth tons of money."

All of which calls into question, once more, the economic strategies of the Bloombergistas-pushing stadia and mega rich real estate development at the expense of small business, local communities, and now we find, the tax payers as well: "No one is ready to say that the Yankees will turn into Lehman Brothers. But will the city really be able to collect all the rent it is owed from the garage that it is building for the team at a cost of $80,000 per parking spot? The garage operator gets to deduct some of the rent it owes the city if revenues don’t make certain projections, says Bettina Damiani, project director at Good Jobs New York, a think tank that has done studies critical of the stadium subsidies."

Stopped clock Lupica captures this and refracts it through the Bloomberg third term lens: "Somehow New York could make the transition from Rudy Giuliani to Bloomberg in the shadow of Sept. 11. Just not now. Of course this isn't about what is best for the city, it's about what's best for Bloomberg, who is 66 now and got absolutely no interest from the rest of the country when he tried to float his name for higher office earlier this year. So now Bloomberg, busting out of the gate showing how indispensable he is already, proposes big budget cuts for the city and more taxes and reducing the city's work force by as many as 3,000 jobs."

But the Yankees continue to live large will all others must sacrifice: "Both the Mets and the Yankees got a pile of city money to build themselves new baseball stadiums, both of which will open in April. They got this kind of money because ballclubs getting this kind of money, no matter how much of their own money they put up, has become the great civic hustle of the last 25 years in America, at least when America still had money. Always the taxpayers are told the same thing, from coast to coast: How good this will be for them, when the truth is that it is good only for the taxpayer who owns the team, and the taxpayer who builds the owner his grand new stadium."

Concluding, Lupica underscores the Bloomberg hypocrisy: "At a time when there isn't enough money to make the city work right and Bloomberg has to ignore public referendums to keep himself on the job because he needs something to do in his golden years, it is a boom economy in New York baseball, you bet. And nobody at City Hall seems to appreciate the irony of that at a time when the mayor wants everybody else to clip coupons and make sacrifices."

So, with Bloomberg arguing that his expertise and fiscal probity merits overturning the will of the people so he can lead the city for a third term, it's extremely useful to examine how his expertise has been exercised. If we look at Yankee Stadium, what we see is toadying to another billion dollar enterprise with no thought to the impact that corporate largess would have on the city. That's the kind of financial know how that's not even worth a dollar a year.

Malcolm Still Falling Short

It what promises to be a real potential donnybrook, at least two of the senators who have refused to support Malcolm Smith for majority leader reiterated their opposition to the Queens lawmaker-in fact, the defection of Hiram Monserrate from their so-called gang of four has only apparently hardened their stance. In this morning's NY Daily News, Liz Benjamin lays it out:

"After seeing one of their Gang of Four defect, two renegade Senate Democrats dug in their heels Sunday and threatened to hijack state government by letting a leadership battle drag on for weeks or even months..."I don't care if we go past the opening of session without a decision," a defiant Kruger declared. "Until I am totally satisfied the house will be run differently, that there will be a voice for everyone and not just the left wing of the party, I won't ever, ever, ever succumb."

For Kruger's part, he sees the Monserrate defection as a result of pressure from left wing elements in the Democratic party, particularly the WFP, to take control at the expense of tax payers, home owners and small businesses. The other senator who's not enamored with Smith's leadership, the Bronx's Pedro Espada told the News: "Espada reiterated he won't vote for a Republican leader, but he won't support Smith, either. The rebel Dem said he is holding out hope for a "fusion" leadership team - possibly with him as leader and a Republican as his No. 2. "I can't say that's not being discussed right now; 32-30 either way does not make a real mandate for either party to claim," Espada said."

These two intransigents are still joined by Senator Ruben Diaz, a lawmaker with a deep social conservative concern around gay rights issues: "Diaz Sr., a Pentecostal minister, has said he won't vote for any leader who will bring a same-sex marriage bill up for a vote. Gay donors poured money into the Senate Democrats' coffers this election season, and marriage is their top priority. Smith supports gay marriage, but has said the Democrats' first priority is the state's fiscal crisis. Diaz Sr. might remain neutral when it comes time to vote for a leader, in which case, as Espada put it: "Malcolm can't win - not without Espada and Kruger."

We've been told that gay rights leaders are planning to demonstrate in front of Diaz's Bronx office today-a move that could lead to his further estrangement from a putative Smith reign, As the NY Times reported yesterday:

"Democrats won a narrow majority in New York's Senate, where Republicans have buried legislation to start issuing marriage licenses regardless of gender. A Senate power shift was not a sure thing because four Democrats were considering an alliance with the GOP, which could swing the 32-30 majority back to Republicans.

'The only chance we had for meaningful debate or consideration of these issues in the state Senate was with a new Senate leadership,'' said Alan Van Capelle, executive director of the Empire State Pride Agenda, New York's largest gay rights advocacy group. He added that no bills have passed in New York without some votes from members of both parties."

The leader of the opposition to the Gay Pride agenda is the Reverend Duane Motley. Motley told the Times that the Republicans were solidly against any gay marriage initiative, but that the new potential Democratic heads were unknowns: "The Rev. Duane Motley, founder of New Yorkers for Constitutional Freedoms, which opposes gay marriage, said they knew that with Republicans in control of the Senate that legislation to legalize it ''was not going to come up.''

So, unless the senate Dems can give Diaz some iron clad assurances, it doesn't appear that they can count on his vote-which puts, as the NY Daily News tells us this morning, Malcolm Smith in the middle of a "political revolt." And Espada told the paper: "We do not believe at this point, given the way he has conducted himself, that we can vote for him."

And the issue of Smith's support of Mayor Bloomberg is still rankling some in the Hispanic community. As Gerson Borrero says in this morning's El Diario, the "sombra" of Ferrer is hovering over the senate leadership battle: "Smith le dijo no a Ferrer en su momento, le quito el voto de confianza al representante de mayor rango politico de la comunidad hispana y ese mal sabor empieza a despertar intriga en Albany."

At the just concluded Somos El Futuro conference in San Juan, the governor recognized the problematic senate leadership issue with the following cryptic remark: "When it comes time to vote in January, whichever way the senators vote, that will be right because that will be the majority." Perhaps Paterson, much like the old Persian king, sees the handwriting on the wall.

Hiram Jumps Ship: But Fat Lady Ain't Singing Yet

As Liz is reporting, senator-elect Hiram Monserrate has issued his own declaration of dependence-ditching the Gang of Four in exchange for some magic beans: "The deal was sealed late last night here in San Juan, according to the sources, who are both in Puerto Rico and back home in Albany and have been briefed on the details of the agreement. "He was losing leverage by the hour; there wasn't much more that he could extract," one source said. In exchange for his support, Monserrate will be tapped to head the Consumer Affairs Committee and also chair the new Latino caucus that Smith pledged to create in an effort to woo the three Hispanic Gang of Four members who felt their community has long been under-represented and under-appreciated by the Senate Democrats."

It's kinda sad to see the marine get mustered out for a lack of courage; and the idea that he was, "losing leverage by the hour," is just flat out wrong-the longer he held out the more leverage he ultimately had. In all likelihood, however, the wooing of Hiram-in essence, pursuing a divide and conquer strategy-could ultimately backfire; with the remaining three members feeling a real sense of betrayal.

The betrayal here comes from the fact that, on information and belief (as the lawyers say), none of the three were even told that Monserrate was negotiating for himself-utilizing the leverage created by others to cut his own deal without them. And since when does a "Hispanic" caucus have a chairman chosen by someone who's not even a member? (when it's a "muneco caucus," we believe)

What's instructive here is, as Liz points out, is the extent to which labor and the WFP controls Hiram and the Democratic caucus: "Monserrate's decision to support Smith doesn't come as an enormous surprise...Monserrate is close with a number of labor unions and also ran on the labor-backed Working Families Party line. Even though he has been a renegade as far as the Queens Democratic Party is concerned, backing a Republican for majority leader or even merely remaining neutral and allowing the GOP to remain in control would have been potential political suicide in his Democrat-dominated district."

But Liz, this challenge wasn't necessarily about making the Republicans whole; supposedly it was something more. And, isn't it interesting that Smith's Hispanic dissing apostasy in 2005 is considered Kosher, but Monserrate and the others are threatened with political Armageddon for lacking confidence in Malcolm Smith's leadership? One commenter on the blog underscores this dichotomy: "Hopefully, at some point (present or future), the Senate Dems will tell Kruger that he's unwelcome at the Dem conferences. Wash your hands of this nuisance. Screw him."

So the guy who supported Ferrer in both of his runs, and who has contributed $100,000 to the governor and the state party, is being bum rushed by ideologues who, if given their head, will gleefully bankrupt the state. The Monserrate defection may just free Kruger to be Kruger; prompting him to stand up for the tax paying home owners and small businesses that the "progressives" couldn't care less about. Watch for the law of unintended consequences here, especially if the Padavan vote holds.

But the episode does indicate that the Dems in the senate may becoming the wholly owned subsidiary of the WFP, et al; which is not a good thing for either the governor or New York's tax payers. As the fiscal mess worsens, and the special interests call in their chips, the three hold outs are still in good position; and wouldn't it be ironic if Hiram's committee went to a Republican?

City Council Attax

Just when you might have thought that the city council was missing a very important piece of anatomy, the moribund body appears to have woken up with a stiffened spine. As the NY daily News reports: "Empowered by the vote extending term limits, City Council members are gearing up for an unprecedented fight against Mayor Bloomberg's tax hike plans. One lawmaker threatened to sue to force Bloomberg to mail out the $400 homeowner rebates. Others accused him of inflating budget shortfalls to manipulate the public. "If you are going to ask me to rely on your overly negative numbers to reach into the pockets of New Yorkers, that doesn't work for me," warned Councilman Lew Fidler (D-Brooklyn)."

Hip, hip, hooray! Now let's see if this is a permanent posture that resists the inevitable mayoral pressure. It does appear, however, that there's a mounting move to confront Bloomberg on all of the tax fronts: "You can't tax your way out of an economic downturn," said Councilman Vincent Ignizio (R-Staten Island), who is considering suing Bloomberg over the rebates.The mayor can't raise property taxes without the Council. Whether he can eliminate rebates without their consent "is something that is being explored," his spokesman said."

Now let's hope that the legislature finally gets it-and by all means can the plastic bag tax as well. What we're seeing, though, is response from the homeowner council reps, and it's unclear that they encompass a majority of the body-in spite of the News' following observation: "Bloomberg faces an uphill fight to win approval on his tax plans after bruising his relationship with the Council last month during the term limits debate."

As we've been saying all along, this fiscal confrontation sets the stage for the next election cycle and, we believe, increases the mayor's vulnerability to a challenge if he's on the ballot next year. The erosion of the mayor's appeal-especially post-Obama-has already begun and will continue to spiral downhill with more cuts and tax proposals.

Dem Leadership, Smashed to Smithereens?

The leverage of the four Democratic hold out senators, continues to grow, with the NY Daily News reporting that the group, while appearing to rule out supporting a Republican, simply refuses to back current minority leader Malcolm Smith: "Despite much speculation the group could strike a deal with the Republicans, Espada said, "It's possible, but highly unlikely." Instead, he said, they are hoping a consensus compromise Democrat can be found. That might be tough, too, since the rest of the Democratic caucus seems to support Smith. "We're not enamored with Smith, clearly, or we would have been in that room yesterday," he said of a closed-door Democratic conference Smith called Wednesday in Albany. "We do not believe ... given the way he has conducted himself that we can vote for him."

Where we go from here is anyone's guess, but the intransigence of the Gang of Four will increase in significance next week as the entire legislature returns at the governor's request. Meanwhile, as the NY Post tells us, the calls for greater Hispanic empowerment is having a desired effect (even though the paper confuses Kruger with Klein):

"State Senate Minority Leader Malcolm Smith yesterday named former state Housing Commissioner Angelo Aponte to head his transition team - and to help him earn the support of three disaffected Hispanic Democrats who otherwise may try to keep the Senate in Republican hands, The Post has learned. What's more, Queens-based Smith may soon announce that Aponte, a one-time New York City consumer affairs commissioner, will become his chief of staff in January - if Smith becomes the Senate majority leader, said a source close to Smith."

While that move's a little better than setting up a Hispanic caucus, it remains to be seen whether it creates any real thawing of the antipathy for Smith. And the NY Times picks up on this point: "Pedro Espada Jr. and Rubén Díaz Sr. of the Bronx said in separate interviews that in all likelihood, the Democrats would have a voting majority when the new Senate convened in January. While their remarks seemed to dash Republican hopes that they could hold onto control of the Senate, which they had had for four decades, the question of who would lead the Senate Democrats remained in doubt. Tuesday’s election increased the Democrats’ hold to 32 of the 62 seats."

All of this seems to mean that there's a great deal of wrangling ahead. As Kruger tells the Times: “This issue is not going to be resolved in the short order,” Mr. Kruger said. “This could take several weeks; this could take several months,” he said, adding that he believed there was some doubt within the Senate Democratic conference about whether Mr. Smith should be the leader.
“And that’s not going be solved because Malcolm wants to divvy up the committee chairmanships,” Mr. Kruger added. “There needs to be a retooling of the leadership.”

To some, it appears that the group have made themselves relevant, but lack a closing strategy. As the News points out: "A number of senators backing Smith believe the rogue members eventually will fall into line. "They've made themselves relevant, but right now they don't have an end game," one Democrat said. "We'll have to wait to see what they want."

Perhaps so, but it could also be that the conference may also be without a workable solution to the impasse; and the longer it remains the more leverage the four will have. As the Times underscores: "The demands of the four senators could set off a reshuffling of positions within the entire Senate leadership. Everything from majority leader and deputy majority leader to lower-ranking posts like assistant whip could be in flux."

What's clear at this point is that no one should be picking out the drapes yet. We'll see how it all plays out: "Carl Kruger of Brooklyn, the leader of the group of dissident senators, suggested that a long fight for Senate leadership positions was ahead. And he's probably right.

Guess Who's Not Coming to Dinner?

According to Liz B, the supposed dinner meeting between Senate Majority Leader Dean Skelos and Senator Pedro Espada isn't really happening: "Capitol Bureau Chief Ken Lovett reached Senate-elect Pedro Espada Jr., one of the so-called Gang of Four, and reports the Bronx Democrat denies he will be having dinner tonight in Puerto Rico with current Republican Majority Leader Dean Skelos. "I'm not meeting with Dean Skelos tonight," Espada said. "I have not met with Dean Skelos. I haven't talked to him in person (in) the last three or four years."

So the silliness continues, and the effort to marginalize the Gang of Four continues as well. The latest is from the Albany Project; and from a brief purview, it appears that we have the making of a real Kossack nasty facsimile: "As Simon just pointed out, although we took 2 Senate seats last night and Gennaro/Padavan still has yet to be called, 4 "Democratic" Senators from NYC may jump ship to keep the GOP in control of the Senate. They have not committed to voting for Malcolm Smith, and spent today meeting with GOP leaders. To these four Senators, Ruben Diaz Sr., Pedro Espada Jr., Carl Kruger, Hiram Monserrate, I have message to you from the Netroots community: If you do not vote for Malcolm Smith for Senate Majoirty Leader, we will expel you from political office in the 2010 Democratic primaries."

Oh my God! This has just got to get all of the dissidents pissing themselves. It reminds us of the old Clint Eastwood line about mouths writing checks that bodies can't cash; or in other words, you and what army of little Caucasian "progressives" is going into the South Bronx to take on the Diazes? And our ex-Marine, ex cop, Hiram Monseratte, must be quaking as well.

The issue here is not whether the four would support a Republican, but whether Democrats will expand the notion of empowerment beyond a single subset. And what do these folks have to say about the party jumping minority leader, who abandoned ship just at the moment when a Puerto Rican was the standard bearer?

But not to worry mis hermanos. We now hear (via Liz again) that Malcolm has returned from his sensitivity training with the following: "New York Senate Democratic leader Malcolm Smith said Thursday he will create a Latino caucus in his conference, addressing one concern of the so-called "Gang of Four" Democrats who threaten the party's newly won majority in the chamber...Smith said a Latino caucus in his Democratic conference will include about five lawmakers and, like other caucuses of black and women senators, will develop and advance legislation on their particular issues."

Was this thought up by a committee? Are we the only ones to see this a just a tad patronizing?-particularly since 28 doesn't yet equal 32. As Fred Dicker pointed out yesterday morning: "Potentially ominous for Smith was the absence at the meeting of the "Gang of Four" Democratic senators and senators-elect who have formed an "independence caucus" that has appeared open to continued GOP control."

And the public statements from the rest of the Dems after Wednesday's non leadership meeting aren't necessarily helpful: "During his press conference, Smith characterized the group as just a caucus, nothing more. "We have a lot of caucuses," he said. "We have an upstate caucus, a suburban caucus, a black caucus, and an independent caucus." After the scrum, Senator Liz Krueger expressed confidence the mini-rebellion would blow over. "I have not seen anything in writing or spoken by those senators to date. They're not leaving," she said. "All they've done is put out a press release."

In the midst of all of this inside baseball jockeying, it's useful to remind folks that the state is in some very serious fiscal trouble; and the existence of a leadership vacuum is ominous, given the scope of the problems that we face. The four dissidents represent some very diverse constituencies, and we can see their desire to gain more influence as a positive step towards reform and a needed change of direction.

Nickled and Dimed

Mayor Johnny One Note is singing his favorite tune-and the reverberation will eventually threaten to deafen-if not bankrupt-all New Yorkers. As we have been mentioning, the mayor now wants to raise about $16 million a year by taxing paper bags. Here's the NY Times reports: "In its struggle to make New York more green, the Bloomberg administration has tried discouraging people from using plastic bags. It has taken out ads beseeching residents to use cloth bags and set up recycling bins for plastic bags at supermarkets. But now the carrots have been put away, and the stick is out: Mayor Michael R. Bloomberg has called for charging shoppers 6 cents for every plastic bag needed at the register."

What's messed up about this is that the city council has already passed, and the mayor has signed, a plastic bag recycling bill; something that this tax would obviate: "Several City Council members said they were intrigued, but needed to see more details. Several did note, however, that it was only a few months ago that the Council passed — with the help of environmentalists and plastic bag manufacturers — a law requiring all stores that provide plastic bags to accept plastic bags for recycling, with some exceptions."

In our view, this is just the beginning-and the mayor's tax reflex just getting started-and calling it a "fee" will not alter the impact here: "Bloomberg officials say the proposal remains a work in progress. But for now, the plan is to charge customers 6 cents a bag at the point of sale, with 1 cent going to the store owner as an incentive to comply, said Marc La Vorgna, a Bloomberg spokesman. The officials did not elaborate on the mechanics of how the money would be remitted to the city, or how the law would be enforced. It sounds like a tax, but officials call it a fee. The distinction is important: A fee requires approval only from the City Council, while a tax requires approval from the State Legislature."

There's little question that the tax is not only regressive, but that it will have a negative impact on the local retail economy-the fee would apply to even the smallest stores-at a time when so many New Yorkers are suffering; this is the wrong way to address a budget meltdown-and the upcoming additional levies will no doubt be even more onerous: "At the 2000 N.Y. Deli on Second Avenue at 103rd Street in East Harlem, the owner, Sammy Ali, 30, said his customers would balk at paying for plastic. “No way,” Mr. Ali said on Thursday. “They ask us for plastic bags for free as it is. When we say no, they curse us out. They demand a bag for a 25-cent bag of chips.”

And the industry's concerns are legitimate: "A tax on plastic shopping bags would be regressive, with the most severe impacts on those who are least able to absorb them,” said Keith Christman, senior director of packaging for the American Chemistry Council, a manufacturers’ lobby. “There are better ways to protect the environment, to encourage sustainable choices and to support recycling without making it harder for those who are already struggling to make ends meet in a difficult economy.”

Mike Bloomberg, who no one believes buys his own groceries-or anything else, for that matter-needs to understand that not everyone is a Whole Foods shopper; and that supermarkets in particular are struggling to stay in business because of the cost of operating in this city. In this regard, the bag charge illustrates clearly how supermarkets, and their customers, are being nickeled and dimmed in NYC. As the NY Daily News points out: "Bloomberg is a piece of work," Clemelda Gipson, 39, said outside a D'Agostino grocery store in Chelsea. "Food is expensive and now we have to pay for the bags, too? They should try to come up with ideas and solutions and not just more taxes."

And here's the twit who came up with the idea-an eco-freak with no clue about the city's local economy: "They're charging sales taxes already. There's not some massive new overhaul or bureaucracy that's needed," said Rohit Aggarwala, Bloomberg's head of environmental affairs."

Here's someone with no idea how the city works-and he's contemplating a deposit refund to the store of a penny that will cause a great deal of bookkeeping confusion. As the Times tells us: "Bloomberg officials say the proposal remains a work in progress. But for now, the plan is to charge customers 6 cents a bag at the point of sale, with 1 cent going to the store owner as an incentive to comply, said Marc La Vorgna, a Bloomberg spokesman. The officials did not elaborate on the mechanics of how the money would be remitted to the city, or how the law would be enforced."

Sometimes it is the little things that reveal some big picture comprehension; and the nickel bag tax may be just that kind of epiphany for New Yorkers-revealing to them just what kind of a narrow minded and governmentally challenged leader Bloomberg really is. It's also an idea that has led to a loss of revenue in other municipalities, leading us to believe that the bag tax is really simply another Bloomberg environmental intrusion that underscores his lack of concern for how over regulation cripples the local economy.

Last Resort of Scoundrels

In this morning's NY Times, the paper credits Mike Bloomberg with fiscal probity on the NYC budget: "Some lawmakers in the city and in Albany are suggesting that things aren’t really as bad as Mr. Bloomberg is saying. They think rainy-day funds and other pools of money can plug the city’s gaps without requiring sacrifices from residents. That is shortsighted, at best. Mayor Bloomberg has maneuvered New York City through one recession. We believe he has a good sense of how to help New York weather this one — even if that means politicians have to make tough and unpopular decisions before an election."

And, of course, the Times sees tax increases as integral to these "tough and unpopular decisions." As it reminds us: "If Mr. Bloomberg’s proposals don’t plug the projected $4 billion shortfall over the next two years, the mayor may have to propose an income tax surcharge. New taxes, of course, should be the last resort. For one thing, the city can only raise the rate for property taxes on its own. Authority for any other tax increase would have to come from Albany, where Gov. David Paterson is wrestling with his own nightmare deficit projection of $47 billion over the next four years."

As the city's financial situation deteriorates, we can depend on the Times to paint by the numbers and recommend what it always recommends-more taxes on over-taxed New Yorkers; except, as Wikipedia reminds us, for the Times itself: "Additionally, the New York Times Company received $26.1 million in tax breaks."

Mike: Take a Hike!

It certainly comes as no surprise to us that Mayor Mike's reverting to bad form on taxation policy; we've argued for a long time that Bloomberg=John Vliet Lindsay, just with a lot more money. As the NY Times reports: "Mayor Michael R. Bloomberg said on Wednesday that he would immediately halt a popular $400 property tax rebate and that he might need to raise the city’s personal income tax by up to 15 percent to help plug a budget shortfall expected to hit $4 billion in the next two years."

Brother, here we go again. We're partying like its 2002 and the mayor, who has squandered real opportunities over the past seven years to rein in city spending, is back to his old tricks: "Should there be an unexpected upturn in the city’s finances, Mr. Bloomberg said, he might reconsider issuing the rebate checks. But, he said, it is far more likely that the city’s economic outlook would continue to deteriorate, forcing even more cuts, and tax increases, by early next year."

So the great fiscal genius who has to change the law to get an undeserved third term, is reprising the 1970s because he lacked the capacity to tackle real government reform-coasting instead on a Wall Street windfall that we're not going to see again any time soon. As the NY Daily News points out: "His solution includes:

- Not only slashing 3,000 jobs but canceling the January Police Academy class.

- Chopping school-based budgets by 1.3% - $359 million - over the next two years.

- Rescinding the 7% property tax rate cut this year, pumping $576 million into the city's coffers.

- Erasing the $400 rebate, a savings of $256 million.

- Increasing fees and fines to generate $123 million."

When your not either prudent or creative, this is what you have to fall back on-harsh tax and cut policies. As one observer notes: "He's being consistent with past patterns, trying to get a head start on worsening problems," said Doug Turetsky of the Independent Budget Office,..." Well, that's half right-at least Bloomberg gets credit for consistency.

But Mayor Mike has a new ingenious tax to proffer-a tax on plastic bags (what about the city's vaunted plastic bag recycling program?). As the Times tells us: "And in a move intended to both conserve resources and pad the coffers, Mr. Bloomberg said the city planned to charge customers a nickel for each plastic bag they use at every store, whether it be a bodega, a Barnes & Noble or a Balducci’s. Aides said they were working out details of the proposal."

That's just what we need, another tax on neighborhood stores. It's not bad enough that the city hasn't done a thing to help grow the retail sector-and has instead taxed and regulated the stores to death-now it wants to add more expenses in the middle of a recession. Just how does Bloomberg think he's going to nurture economic growth?

And the Times likens the mayor's budget briefing to a grim shareholders meeting: "The briefing had all the hallmarks of a full budget address, complemented by a detailed breakdown of cuts and revenue projections, even though Mr. Bloomberg is not supposed to deliver such a speech for two months. And as Mr. Bloomberg talked, with the confidence and vocabulary of someone for whom finance is obviously not a second language, the 90-minute briefing could have been mistaken for a grim shareholders’ meeting, complete with laser pointer and slide show presentation." If, accurate, shouldn't we be looking for a new CEO-someone who is better informed about the company's fortunes than the current head?

All of which makes a mockery of the assertion that Mike Bloomberg's necessary for these tough times. To us, he's exhibited a significant and fatal lack of prescience; as well as a deficit of understanding on how to make government operate more efficiently. His current budget gambit is the best argument for his timely retirement.

State Senate Silly Season Meets Latino Issues

The uproar over the battle for leadership in the New York State Senate is getting silly-and disinformation abounds. In the TU's Capitol Confidential yesterday, for instance, there was a citation from the AP's Mike Gormley that deserved the Pulitzer Prize for fiction: "The four Democratic senators met Wednesday with GOP leaders who hold the Senate majority at least until Jan. 1, according to Republicans and Democrats familiar with the meeting. The meeting was to discuss how the four might serve the GOP and what’s in it for them should they defect, according to the officials who spoke on the condition of anonymity because leaders wouldn’t confirm the talks."

Never happened; and in fact, at the time of the supposed meeting the four were actually meeting with Governor Paterson. But the piece is instructive because it shows the extent to which the four hold outs from the Smith coronation have instigated fear and loathing in the Democratic caucus. Anonymous sources freely disparage the four, while leaving us to observe that the gratuitous nastiness diverts attention from questioning the over all qualifications of everyone in the upper chamber; a case of glass houses for sure.

What's interesting in all of this is the extent to which Latino character assassination seems to be fair game to some. It's worth noting that when the senate minority leadership was up for grabs a couple of years ago, Brooklyn's county leader Vito Lopez advanced Senator Marty Dilan's candidacy-only to watch it get scuttled by certain members of the Brooklyn delegation who went with Smith rather than Dilan-get the picture?

But the AP's Gormley gets the following right: "The fight for control of New York’s Senate that Democrats thought they won in historic fashion Tuesday stretched into Wednesday and could go on for weeks with a group of four maverick New York City lawmakers essentially holding the key to the balance of power." And it's past time to acknowledge the extent to which New York's Hispanic politicians have been the step children of the minority empowerment movement. The treatment that Dilan received, is being mirrored today by scurrilous anonymous sniping of the three Latinos in the independent caucus.

The NY Times hits the Latino empowerment issue squarely: "Three of the four holdouts are Latino legislators who feel Latinos have been underrepresented in leadership roles in city and state government and want to press the issue in the Senate. Mr. Díaz said the four men, who have formed an independent political caucus, may put off making a decision on whom to back for leader until the new legislative session begins in January. “There’s a concern that we have a black president, a black governor and we have a concern that we have to be sharing power,” said Mr. Díaz."

This becomes extremely sensitive, as the state approaches its reapportionment in 2010. Without any Latino leadership, its not gonna be easy to maximize this group's legitimate political power. Monserate's comments to the Times alludes to the over all issue: "Mr. Monserrate said in a statement that “we must continue to fight for representation for our diverse communities,” adding, “our community does not have a single state or citywide elected leader in any legislative body.”

So, if the group can stay together against the self serving snipers, there's a good chance that they can emerge with real influence-whoever the eventual leader turns out to be. Cohesion, however, as Liz B points out, ain't easy, but the numbers work in their favor: "The Republicans view Espada and Sen. Carl Kruger, who is the only Democrat to hold a committee chairmanship in the GOP-controlled Senate, as their best bets in this longshot bipartisan bid to hold the majority leadership. Diaz Sr. has indicated he could remain neutral in the leadership vote, which means it would take 31 votes, not 32 to make the leader. Actually, it would only take the majority of whoever happens to be in the chamber at the time of the vote, so the Democrats better be careful while walking near the Capitol closets and bathrooms on that fateful day."

A very high stakes game of chicken indeed! And to the strong willed go the spoils here.

The First Cut is the Deepest

As anticipated, Mayor Mike has announced his first round of layoffs and tax increases. As City Room reports: "Delivering a grim prognosis for the city’s economy, Mayor Michael R. Bloomberg announced plans on Wednesday to save $1.5 billion this fiscal year and next, by trimming 3,000 jobs from the city’s workforce, rescinding a popular 7 percent property tax cut and suspending the annual $400 property tax rebate checks that homeowners have come to rely upon."

Well, "The Lord giveth, and the Lord taketh away," we guess-but this isn't a good harbinger for the future political fortunes of the mayor. Coming off an image busting repeal of term limits-and approaching the Christmas season, no less-it's not the best time for the mayor to be imitating scrooge; and he does look a little Grinch-like, doesn't he?

All of which makes us really wonder if Mike Bloomberg is a glutton for punishment. Why would he seek a third term under these dire circumstances? "Revenues have “started to fall off the cliff,” the mayor warned. He said that on Tuesday he had had lunch at a restaurant where business was down 30 percent to 40 percent. “Clearly,” he said, “stores are less busy than they were, restaurants are less busy than they were, and that’s going to translate to our tax revenues declining.” Our view is that he's a true believer in his own indispensability.

This is, however, only the beginning. As the term limits litigation continues to agitate the New York public, the mayor will also be faced with defending his school governance against a vocal group of parents and grass roots critics. And there's reason to believe that he may well be left friendless in Albany as a result of the power shift that will come in January.

It may not be so unreasonable to imagine that the once steadfast Mayor Mike may want to troll for greener pastures in, first Washington with the Obama Administration, and then in Albany, with a 2010 run for governor. Clearly the city heat is gonna arrive early in 2009, and Bloomberg's never been one for the kitchen.

Hispanic Empowerment Diminished

In this morning's NY Daily News, Juan Gonzales details the Hispanic empowerment angle in the leadership challenge by Kruger and the three amigos: "Gov. Paterson met in a Manhattan hotel Wednesday with four rebel Democratic state senators who are threatening to scuttle plans to elect Malcolm Smith Senate majority leader. The dissidents - three of them Hispanic - told the governor they are tired of the state's Democratic Party taking Latinos for granted, despite their role in the party's huge victories on Election Day."

In a new political era, where the country has elected an African American president, and New York has an African American governor, the state and city is still without ant Hispanic leadership-and it's noteworthy to point out that Barack Obama was elected with the support 0f 66% of the Latino vote: "We had a frank discussion with the governor, and he heard us clearly," said Sen. Ruben Diaz of the Bronx. "We have a black President now, a black governor, a potential black majority leader in the Senate, but not a single Hispanic in any major statewide or citywide office," said one of the lawmakers at the meeting. "We told the governor we're the biggest minority in the state, and we keep getting nothing but lip service and parades."

The story here-and Gonzales indicates that Paterson told the four of his support for Malcolm Smith-is that the governor met with the four legislators at all; an indication to us that he takes their independent stance seriously: "The mere fact that Paterson met with the dissidents was seen by some as a signal to the majority leader in waiting that he needs to be more responsive. And with Democrats controlling the new Senate by a 32-30 margin, the four dissidents, should they stick together, could make the transition to Democratic rule in that body - the first in 43 years - a messy one."

Others, however, threatened by the move, can't resist the anonymous back biting: ""They're living in a fantasyland," countered a veteran Democratic lawmaker. "After all these years in power in the Senate, the Republicans are not going to suddenly line up behind a Democrat for majority leader." "This is nothing but a caucus of backstabbers," said a New York City senator who backs Smith. "They can't even trust each other."

You know, these closeted snipers should have the courage to step forward-after all, the four are simply being farcical, according to these anonymous carpers. As Gonzales points out: "Some in Albany see this last-minute rebellion as an almost comical diversion." When the dust clears, however, it could well be the four dissidents who have the last laugh.

It seems that when Latinos push for greater empowerment their efforts get derided, or simply ignored-remember that Smith supported Bloomberg over Ferrer-but when the shoes on the other ethnic foot, than everyone's counseled to exhibit heightened sensitivity. In our view, power sharing is the order of the new day, and the crisis facing the state, enhances rather than diminishes this effort: "With the economy in a tailspin, the state facing huge deficits and the governor having called an emergency session of the Legislature later this month, this is not the time for Democrats to start fighting each other, they say. "What do these four have to say about the real problems facing New Yorkers?" one state official said."

Oh, the bitter cup runneth over-and to deride these four challengers, assumes that the current political pretenders awaiting being anointed are Diogenes-like. It only underscores what the four are saying about the belittlement of Latinos seeking to gain a larger piece of the pie; it's always, "Stand in line and wait your turn." A turn that others would like to postpone indefinitely.

Hanging On-By a Thread?

With the "leadership" meeting today run adrift, it looks more and more like Malcolm Smith may be coming up short. As the City Room blog reports: "Democrats won 32 of 62 seats in the State Senate on Tuesday, gaining control of the chamber for the first time in more than four decades.
But the leadership picture for the narrowly divided chamber remains unclear. Four Senate Democrats — Pedro Espada Jr. and Ruben Diaz Sr. of the Bronx, Carl Kruger of Brooklyn and Hiram Monserrate of Queens — recently formed their own independent caucus and have refused to say whom they will support."

Some things are hard, but repealing the laws of mathematics just isn't possible-unless you can inveigle one of the wild cards into the Smiith column; no easy task: "Members of the group have leaned rightward in the past; Mr. Diaz is a social conservative and a staunch opponent of gay marriage, while Mr. Kruger was an ally of Joseph L. Bruno, the longtime Republican majority leader who retired this summer."

But it's hard to pin an ideological label on the four holdouts. Monseratte has been a champion of Willets Point small businesses against mega development; and has been a vociferous opponent of eminent domain-as has Diaz, who has fought with the Alliance in the effort to keep a Key Food store alive on Bruckner Boulevard. And the Reverend's economics is decidedly left wing.

As for Kruger, the Brooklyn lawmaker was an early supporter of Freddy Ferrer-in 2001 as well as in 2005; not the most conservative thing to do in his pretty conservative (in New York terms) district. In fact, it is most productive to see the group as a proponent of Puerto Rican-Hispanic empowerment. And if the four are able to broker a leadership deal, it will likely yield a great deal of newly important Hispanic lawmakers and staff.

It's useful to point out in this regard, that while Kruger and the three amigos were supporting Ferrer's run for mayor in 2005, Smith and his patron-Rev. Floyd Flake-supported the Bloomberg re election bid; a move that obviates any charge of party disloyalty in the current leadership squabble.

In an effort to demonstrate its independence, the four senators met today to discuss strategy. As Liz highlights: "The four-man independent Senate caucus, (AKA the "Gang of Four") which is boycotting the meeting of their fellow Democrats called by Senate Majority Leading-in-Waiting Malcolm Smith in Albany this afternoon, met earlier today in Manhattan for a little con-fab of their own. So far, the caucus is sticking to its guns and refusing to announce its leadership preference, but also reveling in the fact that without the votes of its members, Smith can't become majority leader (unless, of course, he finds some friendly Republicans in the ZOPA)."

And Spin Cycle also weighs in: "Democrats switched two seats in the State Senate yesterday, and now control the body by a 32-30 margin. Or, do they? Much watching today and over the coming days will be devoted to the Gang of Four -- four NYC Senators, nominally Democrats, who have made clear their intention to conduct a bidding war for their services and, at least on paper, remain open to reinstating Dean Skelos as majority leader."

The Newsday blog also underscores the fact that Kruger is no DINO: "Later in the day, it should be noted, Kruger issued a separate release announcing that he was giving $50,000 to the Democratic state party and $50,000 to Gov. Paterson -- apparently to demonstrate that he was loyal to the party, just not necessarily to the Senate Democratic leadership."

All of this will continue to play out around the fiscal negotiations-with both Smith and Skelos playing budget cut chicken with the governor. Smith's public posturing around the cuts can't be helpful in solidifying any leadership position. As Liz B indicates: "Fresh off his big election night victory, Senate Majority Leader-in-Waiting Malcolm Smith today made no guarantees his conference will come up with a list of proposed cuts to meet Gov. Paterson’s Friday deadline, DN Capitol Bureau Chief Ken Lovett reports."

And the entire leadership issue may come down to a game of chicken-with the four wild cards holding out a dalliance with the Republicans as the ultimate leverage. Certainly the kvelling over the Dems triumph by van Capelle and the Gay Pride folks, doesn't help Smith's cause. Still, until someone else emerges, Smith is still the only one standing in front of the room. It may, however, turn out to be a short stint; despite being annointed one of Tuesday's "winners' by the Crain's Insider, and getting "vote of confidence" from Albany tone deaf Mayor Mike.

Spin Cycle gets the last word here: "There is both a defensive and an offensive aspect to the move. The four "independent" Dems are not on the tightest of terms with presumptive Majority Leader Smith, so they're warning him not to mess with them. They could be the tip of a spear that tries to push Smith out, now or later, as a price for giving the Dems control. They could actually be contemplating supporting Skelos (Kruger has headed a committee and caucused with the GOP). Or, they could just be positioning themselves as permanent powerbrokers."