So Long, It's Been Good to Know you

Well, here's something that you really didn't hear from the Bloomberg campaign, even with $100 million in infomercials-the plight of small business under his watch, and the exodus of New Yorkers unable to bear up under the high cost of living in this luxury product city. As the NY Post highlights:

"Experts say the city’s rising levies and property taxes have taken their biggest toll on its nearly 200,000 small-business owners. “The city extracts a very high cost on small businesses,” said Manhattan Institute senior fellow Steve Malanga. “The biggest problem that they face is actually property taxes.” According to Malanga, the commercial property tax in most cities is generally 1.7 times that of the residential property tax, but in New York City, the rate is eight times more. Annual revenue from property taxes has doubled from $8 billion in 2001 to $16 billion today."

But you would think that a wealthy businessman who supposedly isn't beholden to the city's special interests would be able to devise public policy that wouldn't cripple the real engine of New York's economy. That supposition, however, is based on the Myth of Mike-and eludes the extent to which Bloomberg himself comes from and embodies the city's elite class. It is based on the illusion-one that the editorialists at the NY Times cling to religiously-that it is only when politicians are taking campaign donations from the Fat Cats that they must be viewed with suspicion.

That belief is just flat out wrong-and Mike Bloomberg is the poster child for its debunking. Many years ago, a sociologist named Floyd Hunter wrote a seminal book on community power structure. In it, Hunter underscored how certain industries come to dominate the social life and politics of a municipality. Hunter's work on power was popularized by C. Wright Mills in his more famous book, The Power Elite.

In NYC it is, as Newfield and Paul du Brul have so eloquently shown, the real estate industry that forms the bedrock of the city's permanent government since it is the engine that drives politics and a great deal of the big policy decisions. That it does is rather obvious when we take a look at the value of property in the city, and the list of our town's richest citizens. Yes, it is true that finance and financiers are part of the wealthy elite, but decisions effecting that sector are generally not made down at city hall-but the big real estate moves most certainly are.

Which brings us to "Above Politics" Mike. In the past eight years, Bloomberg has either driven or supported all of the major big real estate grabs-ignoring or down playing whatever impacts these developments might have on neighboring communities or smaller businesses. From the Bronx Terminal Market to Willets Point, the mayor has tireless promoted big real estate. These are his friends, they are, "his people."

And no firm has benefited more from the mayor's energetic promotion of mega-development than the Related Companies. No bid contracts and huge, risk reducing tax subsidies, have characterized Related's successful real estate efforts all over the city. The latest, of course, is the Kingsbridge Armory.

Mike Bloomberg naturally sees these kinds of projects as good for the city-having no insight or sympathy for whatever the collateral damage might be from these kinds of policies. Is he thus, "beholden" to special interests? Does it really matter when the substance of his policy decisions are examined?

No matter how you characterize the Bloomberg decision making model, it still comes down to the fact that the mayor sees the world through the eyes of the Steve Rosses and Steve Roths of the world-demonstrating just how limited the concept of, "beholden to special interests," really is when it comes to one Michael Bloomberg. The end result, in any case, is the same as if the mayor was on Related's payroll-except the company gets off cheaper with a billionaire mayor, one that it doesn't need to fork over even one penny to, as its number one cheerleader.

But, back to the Armory. In the case of this development, tens of millions of tax dollars are being used to subsidize the project-one that, when finished, will likely siphon millions of dollars away from the small businesses at nearby Kingsbridge and Fordham Roads; retailers that have been devastated by the current recession as well as the economic policies that the NY Post writes about so movingly. For these entrepreneurs, the proposed mall is like a bus ticket out of town.

Yet, the city's Economic Development Corporation-somewhat of an oxymoron, no?-never even bothered to do its own economic impact analysis of just how this development might impact local businesses; leaving this task to the Related itself. And guess what the developer found? Yes, you're right-a 600,000 square foot retail mall, funded with tax payer dollars, would have no negative impact on the adjacent retail shopping areas.

The plight and flight of the city's small businesses, then, is something of a natural phenomenon in the eyes of the mayor's brain trust-having no relationship to the city's own economic decisions. And who exactly is over at city hall to tell the mayor about this plight, and the potential negative impact of these subsidized malls? All of the Wall Street refugees that populate the economic brain trust, like Lieber and Pinsky?

So, as we get ready for this third term, what can we expect differently from a mayor whose entire world view and mindset is in sync with all of the bien pensants of the wealthy elite? A greater awareness of how development needs to be sensitive to Bronx residents who are unemployed at record levels? This would mean insuring that Related agree to a development paradigm that includes a living wage and protection of workers at the new mall.

In the absence of that kind of expectation-and the realization that Bloomberg will continue to govern on behalf of the power elite, it falls on the city council to begin to speak truth to power. Next week, the first city council hearing on the Kingsbridge Armory will be held. It is the first test of whether we will see a new political metric-one that looks to protect and nurture small businesses and workers alike; or simply a continuation of the special interest politics that Bloomberg has so famously championed, while simultaneously proclaiming his apolitical independence from the very forces that adhere seamlessly to his very genetic make up.