Beware of the Wal-Mart Booty Capitalists

We have already pointed out that Wal-Mart will undoubtedly be following its successful Chicago incursion as a model for breaking in to the New York City market. We have referred to the potential Wal-Mart partners in this effort as "booty capitalists" and although the term was coined by Karl Marx its modern application refers to some opportunists, especially in the African-American community, who, while having few economic resources of their own, will use their political positions and a company's vulnerabilities to their own personal advantage.

In the process the booty capitalists will undoubtedly evoke terms like economic empowerment to create an effective symbolic cover for their own aggrandizement. It will also not be surprising if we find out, after the fact, that the development effort cost a great deal more than it should have under normal market conditions.

This is exactly what happened in the original NYC case of booty capitalism: the building of a Pathmark Supercenter in East Harlem. And while Pathmark is certainly not in Wal-Mart's league when it comes to a whole host of labor and other issues the comparison is an apt one if we simple examine the development deal itself.

What happened in East Harlem was that Pathmark hooked up with Rev. Calvin Butts and the Abyssinian Development Corporation (ADC). The supermarket development was then transformed into a community empowerment project and the mostly Hispanic independent supermarket owners were effectively pitted against “The Community.” As a result, the development was also larded up with subsidies from the federal government, low interest loans from the city and a grant from the Local Initiatives Service Corporation (LISC), a spin-off of the Ford Foundation.

The money certainly flowed and as Tamar Jacobby and Fred Siegal pointed out later in the New Republic:

According to knowledgeable Harlem residents, this is exactly what happened with Pathmark...One person close to the deal claims that the supermarket could have been built at a fraction of its cost - but the developers - flush with low interest loans and government money chose to pay extra for the builder who got the contract...

Chose to pay extra? What an interesting circumlocution. This is precisely what the booty capitalist will always do. Where did the extra money go? Does anyone believe that the lucky builder was simply overpaid? And who was right in the middle of the transaction? The answer: none other than Charley Rangel, who was able to put aside his disdain for Cal Butts in the interest of commerce.

Now that we understand the methodology where will Wal-Mart strike? The logical assumption, one that we had made before, is Southeast Queens. This is where, in an interesting replication of the Harlem situation, a similar partnership is starting to form. We have the rapacious Reverend in the person of Floyd Flake and the opportunistic congressman in the person of Greg Meeks. The site has yet to be identified but trust our sources it is about to happen.

If it does, prepare for a monumental battle, one that will put the Chicago skirmishes to shame. Meeks, who voted against labor on CAFTA is the same guy who, along with Flake, got on the Port Authority boondoggle in support of the JFK Air Train to nowhere, a $3 billion waste of money. But it wasn’t a waste for Meeks, whose hand was out to every contractor involved in the project. Tellingly, in a meeting with the homeowners who opposed the train the congressman famously and shamelessly remarked to his constituents: "You know I can't get elected with money only from my district." Indeed!

Update: Congressman Meeks’s office is vociferously denying the Wal-Mart rumor. Stay tuned.

Small Business Diservice at the BTM

In the eviction of the BTM merchants, the city cited as its legal rationale a section in the city charter{1301,subsect.2} that gives the Commissioner of Small Business Services

the power and duty to exercise the function of the city relating to the development, redevelopment, construction, reconstruction, operation maintenance, management...and regulation of the public markets...

The use of this pretext is without question one of the most breathtaking misuses of authority this city has seen in a long time.

Think of it. The city is alleging that the Commissioner has the authority in his oversight of the public markets to, well, destroy the public markets. He could, according to this precedent, throw all of the wholesalers out of Hunts Point in order to build, perhaps, a football stadium. It really doesn't matter what will be built in place of the Market according to this line of argument.

What should be logical and legal here is that the commissioner's power over the markets should not extend to actions that destroy what the Charter has given him responsibility to protect and defend. Can Judge Cahn possibly view this action any other way? We shall see. He has called for all parties to come to his chambers on October 11th, a day after the wholesalers' rent, a rent they are refusing to honor, is due.

Department of Small Business Services: Time to End the Charade

The City Council's Small business Committee held a series of hearings yesterday and we have asked Rob Bookman, the attorney for The New York Nitelife Association to post a comment on the hearing next week. Bookman is the unchallenged expert voice in defending small businesses from the city's regulatory octopus.

The hearing yesterday was not without some humor. Deputy Commissioner Mark Newhouse from the Department of Small Business Services testified in defense of his agency's record on protecting and defending the little guy. Cited was the agency’s processing of over 13,000 small business help requests, under a program called New York City Business Solutions. The citation misses the larger and more important point.

The DSBS is part of an administration that has been actively hostile in its dealings with neighborhood retailers. The hostility is directly linked to the city's tax and regulatory policies that have targeted stores on the neighborhood commercial strips. Supermarkets, bodegas, greengrocers and restaurants have complained vociferously about the onslaughts from a slew of city regulatory agencies. In fact, a recent survey demonstrated that fines and burdensome regulations are the biggest obstacle to small business sucess in New York City.

The Department has not taken any advocacy role in the defense of the constituency that they are supposed to represent. Quite the opposite: DSBS has instead actively gone out of its way to take the other side in small business battles. It actively intervened in the Ikea battle when it prevailed upon the Fifth Avenue BID to refrain from taking sides in that fight. It was silent on other big box battles as well, with Commissioner Walsh defending his pusillanimity by saying that his agency is also responsible for enhancing tax revenues.

If that were the case than the Department should be engaged in doing the kind of economic impact studies that provide data on the importance of neighborhood business and on the threat posed by box stores to this retail sector. Overseeing the BIDs –
neighborhood entities that fund their activities through self-imposed taxes – is not substantive support of small businesses.

The most egregious example of the agency's lack of any meaningful small business mission, a lack so great that the name of the Department should be changed to promote overall truth in advertising, is the eviction of the 23 small merchants from the Bronx Terminal Market. Here the Commissioner, in his charter mandated oversight role over the public markets, unceremoniously kicked out the BTM merchants, unilaterally abrogating their legally binding leases. Walsh did this, not of his own accord of course, in order to pave the way for a mega retail development that will replace the Market's small wholesalers with box stores.

This action was so entirely anti-small business that anyone who sincerely saw his agency's mission to protect small business would have resigned on the spot when asked to do this singularly dastardly act. Walsh, the careerist, simply continues unaffected by his betrayal of a constituency he is supposed to defend.

Greg Sargent Responds to Fred Kaplan

The following is a comment sent in by New York Magazine reporter Greg Sargent that we decided to post:

I'd like to add a few points to Richard Lipsky's critique of Fred Kaplan's recent piece about the New York mayoral election in the American Prospect.

In taking issue with my earlier piece arguing that liberal Dems should feel conflicted about voting for Mike Bloomberg, Kaplan offers a single central assertion: Bloomberg will win re-election simply because the local Democratic Party is run by "second-raters" and "hacks." The Democrats can’t win because they “don't exude” an "air of basic competence."

Kaplan probably isn't aware of this, but every four years, hack pundits repeat the same cliche he's peddling: they blithely dismiss virtually any and all mayoral aspirants as hopelessly unworthy of the office.

Is this solely because of the quality of the challengers themselves? No -- it's actually more a function of the New York City media market. The 24-hour news cycle, the fact that the mayor's every utterance often frames the news of the day, and endless on-the-scene coverage of mayors during crises all inevitably inflate the post of mayor -- and its occupant -- into something larger-than-life and omnipresent in the consciousness of New Yorkers. Thus it is that would-be mayors almost inevitably are seen as failing to measure up. Consider some of the people political prognosticators confidently derided as lacking either the stature, gravity or temperament to be mayor: Ed Koch, Rudy Giuliani, and ... Mike Bloomberg.

Kaplan further writes that the Dems’ travails stem from “this city’s Democratic Party machine -- it’s insularity, its decrepitude, and, worst of all, its compulsive self-destructiveness,” adding that if they want to win again, “Dems have to start fielding candidates capable of winning...trust.” This is admirable prose, but it betrays an astonishing ignorance of recent history. There hasn’t been a Democratic machine in New York in any meaningful sense in at least a generation; the notion is as anachronistic as Brooklyn stickball and wisecracking cabbies in fedoras. Kaplan's just recycling another tired cliche, one that, as it happens, carries strong echoes of Bloomberg's campaign lit: that elected officials are somehow rendered unworthy by the fact that they worked their way up through local party ranks.

Indeed, Mark Green, whatever his failings, certainly wasn’t a “machine” pol; nor could he have been dismissed as a “hack” or a “second-rater.” Bloomberg beat him not because the electorate doesn’t “trust” Democrats, but because of an extraordinary confluence of circumstances. First, because he won the endorsement of Giuliani, who by then had been so deified by the media after Sept. 11 that you could practically see his halo; and second, because Bloomberg spent $70 million on TV ads showcasing Rudy’s support and inflating Green's negatives. Something similar, of course, is about to happen again: Fernando Ferrer is going to be outspent by as much as ten to one by Bloomberg, all but insuring the mayor's reelection.

That Bloomberg is about to spend $100 million on reelection apparently doesn't trouble Kaplan at all. Even a fair comparison between the two men, he'd likely argue, proves that Bloomberg is superior, so who cares what the mayor does to win? But we should care. The enormous imbalance in resources between the two candidates is bad for the city. It means the electorate, bombarded by TV ads, will be less capable of giving the challenger a fair hearing, which will mean less serious scrutiny of Bloomberg's failings. That in turn makes it less likely that he'll correct them in his expected second term.

It's unclear, of course, whether Kaplan even thinks Bloomberg has any failings. Most voters, he writes, want "a competent manager who protects the city's people and treats them fairly." Actually, plenty of voters want a good deal more than that. They want a mayor who will seriously tackle poverty; who will pursue real government reforms such as seriously dealing with Medicaid; who won’t render the city’s campaign finance program meaningless with enormous campaign expenditures; and who won't try to build taxpayer-subsidized stadiums in the city's richest borough. What's more, a fair number of New Yorkers aren’t so sure they’ve been treated “fairly.” Bloomberg got the city through the fiscal crisis largely with higher property taxes that disproportionately gouged outerborough homeowners of all ethnicities. Small businesses have been deluged by tickets. These things may not matter much to the well-heeled Manhattan liberals who now comprise Bloomberg’s base, but that doesn’t mean we should politely ignore uncomfortable facts about his performance.

Finally, Kaplan argues that Bloomberg is not "a Republican by the national party's standards." He's right. And no, Bloomberg probably isn't a "real Republican" in his heart of hearts. But those points are utterly irrelevant. The only question that matters is, Does Bloomberg being a Republican have consequences for the rest of us?

The answer is Yes. It's meant that New York has lacked a strong critical voice against the national GOP while it stiffs New York on homeland security money and continues to politicize Sept. 11. It's meant he's raised millions raised for Bush and many other GOPers. And it helps the national GOP advance its cause, because it allows it to argue (falsely) that its ideology is triumphing in hostile territory. These are more than mere abstractions or partisan flag-waving; they can have a real impact on our city and on our lives.

Does all this automatically merit a vote against Bloomberg? No, not necessarily. Kaplan mischaracterized the earlier Prospect piece as a "plea" for Ferrer. In fact, the intention was not to argue that liberal Dems should automatically support Ferrer, but that they should feel conflicted about supporting Bloomberg -- that they have a "dilemma" on their hands. After all, the previous piece argued extensively that Bloomberg has in many ways been a highly successful Mayor. But his Republicanism, however superficial or insincere, does matter -- and it deserves to be factored into every liberal Democrat's deliberations.

--Greg Sargent

A Campaign Finance of Convenience

The Times, as expected, after running a front page article yesterday about the Supreme Court’s decision to hear a couple of legal challenges to campaign finance reform weighed in editorially today about its fears that the Court will eviscerate its cherished legislative initiative. Frankly, we've never been big fans of the effort and have viewed the use of the boogyman "special interests" as a completely misguided analysis of how politics is and should be conducted in a democratic-capitalist polity.

That being said, however, if you do believe in the sanctity of CFR you should at least be consistent. Not so with the NY Times. After all, a belief in the corrupting power of money in the political process should compel one to take a long hard critical look at Mike Bloomberg's campaign spending which we believe will top out this year at around $100 million. So far, the Times has not said a word.

Even NY Magazine, in a relatively harmless piece in this week's edition, makes the point about the mayor's political use of his charitable giving. Wouldn't it be appropriate for the Times to treat all of this for what it is: the purchase of political power. This phenomenon, replicated over in New Jersey were Corzine spent $60 million running for the Senate while pretending he was some kind of a faux socialist, deserves a comprehensive evaluation from the paper of record.

Wouldn't it be great if the Times, in one of the its nine stories on Democrats voting for Bloomberg, did a content analysis of the statements made by those respondents as well as the campaign rhetoric in the mayor's commercials? Wouldn't it be great if the Times evaluated some of the Bloomberg grants in this context to see just how much was charity and how much was political calculation?

(We are confident that the Times will eventually do this story except it will be 6 months or so after the election).

Yes we know that people will point out the difference between the so-called special interest money and the lavish spending by one super rich individual. Frankly the differences don't impress us all that much. Case in point: the mayor's economic development policies and the aggrandizement of Related's Steve Ross, a policy redolent with what we have labeled "patricianage."

The simple fact is that elections can be bought and if the power is disconcerting you should be prepared to come out and criticize a person who is outspending his rival by at least 10-1 (And not only that but, as all the papers have pointed out, Mike has cajoled some big bucks Democratic donors to sit on the sidelines, and these very same folks have tried to convince their rich friends to do likewise). Now this, not just the SC's ruling, should be a Times front page feature.

Council Hearings on Small Business Bills

Tomorrow afternoon the City Council will hold hearings on three bills pertaining to small business, Intros 709, 713, and 715. All three proposed pieces of legislation strive to ameliorate some of the obstacles mom and pop stores face regarding fines and regulations. For more we turn to testimony of attorney and small business advocate Robert Bookman:

I am appearing today in support of Intros 709, 713 and 715 as the representative of a number of business groups, including the 1000 member City Chapter of the New York State Restaurant Association, The New York Nightlife Association, and the NYC Newsstand Operators Association, as well as the attorney for many individual small business owners.

The message I have been asked to convey is simple and straightforward: THE SMALL BUSINESS COMMUNITY OF THIS CITY, THE LIFEBLOOD OF OUR NEIGHBORHOODS, IS UNITED IN SUPPORT OF THESE BILLS.

Of particular urgency is Intro. 709, which protects small businesses from truly unreasonable fines. No one says that violators of the law should not be punished. But the punishment should be fair and the interpretation of the law should make sense. This Intro. corrects nightmarish examples of abuse of the intent of laws passed by the Council.

When a sidewalk café is in compliance with its space limitations, and has put outside the proper number of seats, it should not be fined because the table configuration is slightly changed. Yet that is what happens. And when an agency is given the power to enforce a State law that is identical to a City law, a business should not be fined twice for the same occurrence.

As to Intros. 713 and 715, it is Intro. 713 that provides the most practical idea for making the lives of small business owners just a little bit simpler. I have concerns with Intro 715 in that relying on a clerk to advise you what licenses you may need for a new business can get very tricky and raise issues of liability. What is needed, however, is a small business ombudsman in each agency that regulates small businesses, one who is independent from the Commissioner of that agency and who reports directly to the Commissioner of Small Business Services, similar to the I.G. system. Then small business owners will have a person to go to with complaints and ideas and will feel confident that he or she is being listened to.

Health Care in a Box

The Times and Newsday are reporting today on Suffolk County's passage of the "Fair Share for Health Care Act", a bill that would require big box stores such as Wal-Mart, BJ's and Target to pay $3/hr towards an employees health care benefits. The measure mirrors the HCSA that was passed in NYC and which will be facing an override fight on October 11th at the NY City Council (Mayor Bloomberg vetoed the bill claiming that it violated Federal law).

In an interesting comment on the bill, Wal-Mart spokesman Philip Serghini actually said the following:

We are concerned that the health care bill passed today...is a kind of hidden tax that runs counter to Wal-Mart's commitment to everyday low prices

Well there it is folks, a Wal-Mart rep making the direct link between the companies lack of health care coverage and its concomitant ability to keep retail prices low. A clearer presentation of the level playing field argument couldn't have been made more persuasively by a UFCW supporter.

Which brings us to the veto battle in NYC. Talks are being set up between the bill's sponsor, Chris Quinn, and reps from the city's smaller independent supermarkets. These grocers feel that the thresholds in the bill – 10,000sq. ft. and 35 employees –are too low and target neighborhood retailers almost more than the retail giants. Labor supporters of the bill indicate that they are willing to amend the measure but no agreement has been reached on any changes.

Labor Pains and the NYC Press-With a Special Look at the Paper of Record

It is really getting quite upsetting to see the relative paucity of campaign journalism in this city. Our specific beef is with the relative absence of any hard-hitting looks at the shortcomings of Mayor Mike. This is especially important in the context of the mayor's huge spending spree. Without much in the way of journalistic critique all we are left with is the Bloomberg echo chamber.

With the air waves saturated in an all Bloomberg all the time fashion it is incumbent on the city's political journalists to look at the last four years with a critical eye. Unfortunately, we don't see much of this happening. Some of the worst aspects of this political blindness can be seen in the NY Post's blow-up of Freddy Ferrer's putative sell-out to 1199 in exchange for the union's endorsement.

As Jarrett Murphy's piece in the current Village Voice highlights, the Bloomberg team has a whole series of union deals that would be seen as suspect if subjected to the same standards of scrutiny that the Ferrer campaign is forced to endure. On top of this we have the endorsement by the Bodega Association in exchange for receiving additional security cameras and the unexamined impact of the mayor's charitable largesse on the support that he is getting from some members of the Black clergy.

This lack of a critical approach to the Bloomberg administration is not a recent phenomenon. It has, in fact, been characteristic of some of the NY Times coverage from the inception of the mayor's term (With the righteous exception of the work of Charles Bagli, especially his expose of Deputy Dan and his work on the West Side Stadium).

If we examine the Times' coverage we can see a sanguinity about the mayor that goes back to even the dark days of Bloombrg's 24% approval ratings. Just take a look at some of the stories on the mayor done by Jennifer Steinhauer. The paper's former City Hall reporter actually wrote that the mayor was greatly loved by small business at a time when the Bloombergers were raising taxes and fines to record levels.

Just a couple of days ago the Times did, by our count, its ninth story on Democrats who will vote for Bloomberg. We are still waiting for the paper's first prominently displayed piece on Bloomberg's complete evisceration of the city's campaign finance laws. Can you imagine what the paper would do to a national Republican on this issue? The reality is that the Times is a conservative force in NYC, especially when you understand how an entrenched wealthy liberal cultural elite simultaneously shares and wields power in New York.

In the city, this power is primarily wielded by between cultural elites and real estate developers – C Wright Mills would have a field day with all this but in his absence we have only to turn to the late Jack Newfield and the, thankfully, not late Wayne Barrett for a clear picture of NY's power elites in operation (The Times' support of the Supreme Court’s eminent domain decision opens a window to the elite mindset).

As we have mentioned elsewhere, it is an urban renewal impulse melded with a belief in the benevolent role of government. Embedded within this Weltanschauung is a hostility to entrepreneurism as well as to populism in any of its possible manifestations. In this world view the Planner and his faithful bureaucrat are seen as urban heroes, closely followed by wealthy philanthropists whose beneficence offers hope to the downtrodden. Mike Bloomberg is the quintessential leader to those who see the world in this way.

As a result, what we have in this election cycle is the interesting confluence of coverage from putatively disparate newspaper outlets. The Posts' demonization of Freddy is met not only by the Times' demeaning of the challenger's qualifications and chances of electoral success but by that paper's candy-coating of the mayor's record (Closely followed by the Daily News' series of glossy reviews of Bloomberg's first four years). We should, however, exempt the NY Sun from this charge since the more conservative Sun has offered up a wide range of Bloomberg critiques, many of which, like those of Alicia Colon, come from the Right.

What's incredible here, in the face of all this media shirking and record mayoral spending, is that the mayor has only 52%-53% percent in the latest two polls. It speaks to the lurking possibility that Mike Bloomberg is only one snafu away from imploding. If that happens it will, no doubt, come as quite a shock to some of our journalistic guardians.

Wal-Mart Saturation

People may have a point when they say, “How bad can one Wal-Mart store be for New York City?” But the problem is that Wal-Mart is not interested in one or ever a couple of stores within the 5 boroughs. As can be seen in places like San Diego or Lincoln, Nebraska, once the retail giant gains a beachhead in an area it attempts to saturate it, often to the dismay of local residents.

According to the Sun-Sentinel, Wal-Mart wants to bring a second supercenter to Pompano Beach and people are quite upset:

"I hope we don't get one," said Colleen Lacy, who lives in the nearby Kendall Green community. "We have enough problems with traffic, break-ins and grocery carts over here. I figure all it will do is bring our area down. Why can't they stay the same Wal-Mart? Why do we need another one so close?"

The town’s mayor doesn’t want a second store and neither do a number of city commissioners:

"Let them go down to Miramar," said Mayor John Rayson. "I don't think we're quite ready for a second Super Wal-Mart. I'd rather have a Super Neiman Marcus or a Super Bloomingdale's."

…

"I have reservations, " said Commissioner Lamar Fisher. "To have two Super Wal-Marts within a four-mile range ... "

However, Wal-Mart is still pushing the plan, offering up its usual platitudes of jobs and the availability of fresh groceries. Unfortunately, at least one city official is buying it:

"It's a tax base for us, so that helps the economy," said Commissioner E. Pat Larkins, who represents the area. "And some folks from Pompano will obviously get jobs."

Elected officials like Larkins need to realize that the question here isn’t whether Wal-Mart will create jobs (of course it will). The greater concern is how will a second mammoth box store affect the community’s quality of life? Is it worth extra tax revenue to have impassable neighborhoods, increased crime and lower property values? Another question also arises: what are the costs associated with those negative affects (e.g. higher reliance on public services such as health care and police) and does it negate the supposed benefits brought by that second Wal-Mart supercenter?

These will be the type of questions asked in New York City, especially in Staten Island, an area already oversaturated with retail and traffic. Wal-Mart’s cheerleaders in Richmond County can emphasize the job creation and sales tax points all they want but they will have little success in places like Tottenville, Richmond Valley and Charleston if they fail to address the myriad negative impacts of the propopsed 100,000 + sq. ft. store.

We Come (Subsidized), We Sell, We Leave

As we have written about before, one very serious critique of Wal-Mart is that it has little connection to the community it serves and feel no compunction about closing stores in favor of building a supercenter a couple of miles down the road. The problem with this is twofold: municipalities often subsidize Wal-Mart’s entry into the town and they eventually become reliant on the tax revenue the box store generates (especially as other businesses such as supermarkets close). When the world’s largest retailer flees, the town feels duped for offering incentives and suffers from a reduction in sales-tax proceeds.

According to the Desert Sun, this very situation is happening in Cathedral City, CA where both the town’s Wal-Mart and Sam’s Club are moving. Cathedral City Mayor Pro-Tem is rightfully upset at the move:

"Wal-Mart loves to tell you they're a good corporate neighbor, they take care of the community; and that's just wrong, they're not," Cathedral City Mayor Pro-tem Greg Pettis said. "They come into a community and (we) anticipate we're going to make some long-term money and in essence we reimburse them for the sales tax they generate. They haven't done anything for this community."

Rats at City Hall

The Daily News is reporting today that there is a rat infestation at City Hall. Apparently the rodent invasion is the result of lunchtime noshers in City Hall Park. It highlights, of course, the reality of the rodent problem all over the city. If you don't address the food source there is little that can be done about rats.

That is why it is so important, from a public health perspective, to legalize commercial waste disposers. All over various neighborhoods food waste is being stored where food is prepared, stored and consumed. The use of disposers would alleviate this problem while also, as we have shown elsewhere, greatly reduce the city's solid waste management problems.

Democrats for Bloomberg

In his critique of Greg Sargent's lament about Democrats deserting the party in order to support Mike Bloomberg, Fred Kaplan, the Boston Globe's ex-New York correspondent, would like us to believe that New Yorkers would once again vote for Democrats if they only stopped nominating "hacks and second raters." Kaplan then goes on to point out that these very same New Yorkers still cast their ballots for, using one example, Democratic presidential nominees like John Kerry, proving, with no irony intended, that when it comes to national politics we will gladly embrace any hack and second rater the party puts forward. Clearly, when it comes to an analysis of NYC politics we can do better than Kaplan's critique of the Democrats and his elite-based, misinformed defense of Mike Bloomberg.

Something else is afoot here and the nuances of whatever it is have escaped Kaplan. Mike Bloomberg, with no visible rationale or policy expertise, was elected in 2001 over a Democratic candidate who, while he may lacked a lot of things, could not be characterized as either a hack or a second rater. Put simply, Bloomberg was elevated into office in a fluke election and even then only after spending over $70 million, $23 million of which was spent in the last two weeks of the campaign trying to convince New Yorkers that Bloomberg was the reincarnation of Rudy.

What's really interesting here is that Kaplan forgets that the mayor once had approval ratings of 24%, the lowest recorded in New York City history. His ratings hit rock bottom after the mayor raised property taxes by an effective rate of 40% in 2002. Remember that, aside from his faux Giuliani impersonation in the last campaign, Bloomberg also had stressed his business background and used it to attack Mark Green as a tax and spend liberal. Subsequently we found out that all of this was simply a convenient cover for the mayor's apparent lack of any bedrock philosophical principles.

This doesn't really intrude on Kaplan's apologia because as he approvingly points out, Bloomberg "balanced the budget." Aside from being a total non sequitor – mayors are required by law to balance the budget – the observation underscores the typical Manhattan-oriented big government liberalism that sees tax hikes that hurt homeowners and neighborhood businesses as necessary sacrifices for the greater good.

The larger point, however, is that the mayor's tax and regulatory policies underscore his total lack of any fresh approach to making city government run more efficiently. It is a "back-to-the-future" approach that harkens to the profligate time chronicled by Ken Auletta in "The Streets Were Paved With Gold." It certainly doesn't reflect any of the creative approaches to welfare reform that characterized the two terms of his predecessor. This appears to be, at least for Kaplan, another feather in the mayor's cap: The mayor approach is "compassionate," undoing the "damage" inflicted on New York by Giuliani.

It is the kind of worldview that Kaplan's ex-parent company, the NY Times, has popularized: who else but the Times could see Anthony Weiner's tax relief policy as deficient because it failed to adequately make up for the "lost money", i.e., the money that the government would be "forced" to give back to the tax payers. This is the kind of mayor and the kind of policy that Kaplan and the entire coterie of rich Manhattan liberals embrace because they are totally divorced from the reality of people's lives in the boroughs.

It is precisely why Kaplan sees the Bloomberg administration in such glowing terms. Missing is any real grasp of the mayor's hostility to entrepreneurism, his anti-small business regulatory policy, and his congenital instinct to aggrandize billionaire developers like Steve Ross of the Related Companies at the expense of local communities and minority firms. It is the top down urban renewal impulse that characterized all of the worst of 1960's liberalism: the "We know what is best for them" mentality that destroyed neighborhoods and created generations of welfare dependency. In the end, government inexorably became less efficient, less accountable and more expensive.

This is the same mentality captured in Joe Flaherty's classic "Managing Mailer." When Mailer and Jimmy Breslin were campaigning in 1969 they stopped at the kind of East Side Reform Democratic club that Mayor Mike would definitely feel right at home in. When they proposed a program of community control to the well-heeled audience, a rich matron admonished them saying, "Mr. Mailer you don't understand. It's about what we can do for them."

But, Kaplan might argue, look at the mayor's current high approval ratings. Yes let's look at those ratings and put them into the proper context. If I remember correctly the first few polls that came out in the Spring, right after the mayor's stadium debacle, had Ferrer up by double digits.

What's happened since? Bloomberg has spent probably close to $40 million dollars in a saturation ad blitz that, if Fred bothered to notice, is being eerily mimicked when the average New Yorker is asked to comment on the mayor's tenure. This approbation devolves, in zombie-like fashion, into NY's version of one lies and the other one swears to it.

So Freddy Ferrer will be outspent when it is all over by at least 10-1 without a peep from all of the campaign finance hypocrites who would scream if national Republicans had that kind of advantage (And not a word Fred about the mayor's pledge not to spend that kind of money if he ran for re-election?). Also, what does it say Fred when someone as successful as you claim the mayor is must spend $100 million to convince New Yorkers that he has been a wonderful chief executive? Amazingly, Bloomberg does this while saying with a straight face that he is running on his record!

New Yorkers do need better than what they have gotten from the Democratic Party. However, this has absolutely nothing to do with the current electoral choice since neither Bloomberg nor Ferrer threatens to actually introduce innovative ideas to reduce the size of municipal government while increasing its effectiveness. So Fred, criticize the Party if you will but do so while eschewing the ridiculous lionization of a mayor who is as diminutive in policy expertise as he is in size.

Bloomberg: The Anti-Politician?

In a speech this weekend the mayor, for the time, attacked the Democratic nominee, criticizing Ferrer’s approach to Education reform. According to the Times:

In his speech, Mr. Bloomberg defined himself as a sort of antipolitician who, free from the messy impositions of "donors, special interests, patronage or partisanship," has focused solely on what is best for all New Yorkers. He said that mayors "solve problems not by taking both sides of big issues, but by deciding what's right and then going after it," and that "honest leadership that doesn't waver or blow with the wind."

Bloomberg is cleverly spinning his blatant disregard for the campaign finance system by saying that he’s avoiding taking donations from political interest groups. What needs to be pointed out is that not only did the mayor promise in 2001 that he would not spend as much money for his reelection bid, but his obscene spending makes a mockery of the entire election process. The whole purpose of campaign finance reform is to create a level playing field, ensuring that a candidate’s wealth or ability to fundraise isn’t the sole criterion for a successful campaign.

For the past few months, however, Bloomberg has flouted this reform and is on pace to spend $100 million for this campaign. Sure, the Mayor has a very high approval rating right now but the big question is how much of people’s favorable impressions are the result of a disproportionate deluge of sophisticated advertising? While Bloomberg’s lead over Ferrer cannot be simply attributed to spending, when one candidate is outspending another 8-1 it certainly makes a difference.

The other point to be made is that the mayor’s claim that he’s free of “patronage or partisanship” is quite laughable. As we have pointed out, especially with the Bronx Terminal Market project, Bloomberg and his team of dollar a day administrators are in fact quite partial to billionaires like Steve Ross, awarding them no-bid contracts, and generous subsidies for developments. This “patricianage” needs to be fully exposed in order to demonstrate that the mayor's entire economic development strategy is, in fact, beholden to special interests, interests that often conflict with what's best for the New York City taxpayer.

Wal-Mart Goes to the Bank

The NY Post reported over the weekend in its business section that Wal-Mart's foray into banking is generating a great deal of controversy:

Dozens of community banks, banking associations and unions have denounced the retailer's move to form Wal-Mart Bank as the public comment period at the FDIC closed on Friday.

All of this simply underscores what we have said before: There is no retail category that is safe from the rapacity of the Walmonster's juggernaut. In NYC this rapaciousness is a direct threat to the city neighborhoods. The retail diversity that enlivens our local communities will have the life sucked out of them by the box store invasion. The local pharmacy, the gas station, the grocer, the jeweler, the clothing store and now the neighborhood bank branch, will experience the same devastation as the Texas shoreline after Hurricane Rita: nothing will be left and the life of the city, along with most of its retail profits, will be cheerily exported back to scenic Bentonville.

The Gateway Trojan Horse: Consequences of Unaccountable Development

One of this blog’s main themes is the deficiency of current land use review process (ULURP) and the need for a more community-focused, transparent procedure, also known as accountable development. We have argued that, especially when projects receive public subsidies, it is imperative that they be subjected to detailed, independent oversight. In previous posts, we have also supported the New York State Accountable Development Initiative (ADI), legislation sponsored by Assemblyman Brodsky that would require developments to include:

1) Living and prevailing wages
2) Employment benefits
3) Job training opportunities
4) Mitigation of negative neighborhood impacts
5) Community benefits

The need for such legislation stems from the development reality in New York City and around the country. Often big box stores like Wal-Mart and large shopping centers are rammed through with minimal community input and based on misinformation generated by developer-funded consultants. We comment more on this here and here.

Essentially, without the enforcement of accountable development guidelines communities have no idea what they’re getting and no guarantee that they will actually benefit from a planned project. Nowhere is this more true that with the Related Companies’ proposed Gateway Mall at the Bronx Terminal Market.

As we have documented for the past few months, the Gateway Mall, from its very inception, is the quintessential unaccountable development (no-bid contracts, eviction of small businesses, sole-sourced city land giveaways, guaranteed loans, large subsidies and an unbelievable 99 year lease deal). Unsurprisingly, the result of this secretive, dishonest process was a development that lacks transparency, oversight, and maximum community benefits. To make a very bad situation worse, it is also quite possible that the Gateway Mall will become NYC's first Wal-Mart site.

The Presence of Wal-Mart at Gateway: No Accountable Development Means No Guarantee

For the past 6 months we have been attempting to force Related to reveal its Gateway tenants. Once a project is approved the developer has no constraints on which retailers it will choose to tenant the development site. Related knows this and is hoping that a general support for Gateway, and the concomitant revitalization of the Bronx, will be the rising tide that lifts all the boats, even if a few of those vessels are a BJ’s or a Wal-Mart. Therefore unless the developer assures, in a legally-binding Memorandum of Understanding, that such a predatory non-union store will be excluded from the project, the project will very shortly (once the compelling evidence is made public), generate the same energized community, business and labor opposition that stopped Wal-Mart from entering Rego Park.

Related can promise until its blue in the face that Wal-Mart is not part of its development but, given its past performance, there is little reason to believe its self-serving claims. In the first place the disdainful, secretive, and mendacious way the developer has treated the Terminal Market merchants and the Southwest Bronx community makes it hard for anyone to believe any claims it will now make about possible anchor tenants. Secondly, though elected officials have claimed no BJ’s will be on site we have received word, from a very reliable source, that the company has already signed a lease for the Gateway mall. Thirdly, Related’s own EIS describes a site plan perfect for a store like Wal-Mart and repeatedly references the possibility of a non-union club store on site (including a possible Sam's Club).

More specifically, the EIS says the following:

As currently envisioned, the retail development would house approximately five large-scale retail stores totaling 755,990 gross square feet … While specific tenants have not been identified, for purposes of providing a conservative analysis it is assumed that one of the large-scale stores would be a home improvement store, another large-scale store would be a wholesale club, and a third large-scale store would be a department store, while one of the medium-scale stores would be a supermarket (pg. 3-2).

According to our aforementioned source, the three stores with signed leases for Gateway include BJ’s, Home Depot and Target. Therefore, there are still two, approximately 152,000 sq. ft. retail anchors that still need to be named. One of these stores could easily be a Wal-Mart, especially if the rumored the Target lease is either untrue or falls apart. The main point here is that without either transparency or a binding agreement that specifically precludes the possibility, we are forced to assume that both Wal-Mart and BJ’s are Gateway tenants.

All of this uncertainty would have been obviated if a true accountable development process had been initiated from the beginning. The danger for Related is that the non-union box stores it hoped to sneak through ULURP may now be the seeds of the project’s downfall.

The collapse of the Gateway development would certainly not be a tragedy for NYC taxpayers. The disapproval of the land-use application would cede the BTM property back to the city, opening up the possibility of a fair bidding process that could, while finding a way to preserve the BTM merchants, create a community accountable development that would net the city a more lucrative return for its valuable property.

Intro 709, Consumer Affairs and Double Dipping

Currently, the NYC Department of Consumer Affairs can fine a small business for violating tobacco regulations (e.g. not having a "We Card" sign) twice, once under the city law and again under state law. This outrageous provision allows DCP to double its revenue and again shows that the administration sees small business as a perennial cash cow. Thankfully, Intro 709, sponsored by Speaker Miller and Councilmembers Liu, Nelson and Stewart would eliminate such double dipping. We'll keep you updated on this legislation.

Wal-Mart, BJ's and the Race for Speaker

We've been thinking a little more about the BTM/Gateway project and its potential impact on the Speaker's race. As we previously posted the land-use application will come to the Council in December. If the non-union box store issue isn't resolved by then Joel Rivera will be saddled with some heavy baggage.

As it stands, if the development is approved as is, there is absolutely nothing that will prevent Wal-Mart from becoming a tenant (The Daily news reported about this possibility in 2004). The sources that tell us that Target is the department store tenant may be wrong and the ambiguity here is a direct result of Related's careful policy of coyly refraining from actually announcing who the Gateway retailers are. When we combine this calculated coyness with the Wal-Mart policy of not commenting on any of its prospective site deals, well, you can see the potential problem here.

In addition, the EIS for Gateway calls for FIVE box stores and, if the rumors are true, only three are accounted for (BJ's, Home Depot and Target). There's plenty of room for the Walmonster, another indication of the problems that are created when a project proceeds with a total lack of transparency.

As far as the Speaker's race is concerned, does anyone remember Angel Rodriguez? Our recollection was that the Angel's fall from grace (at least before he went to jail), was due to his failure to generate labor support. In particular, we remember that the WFP was extremely active in Angel's demise.

So here comes the hard-charging Joel in December with a non-union box store albatross, perhaps even a Wal-Mart. We can just about hear Juice Newton singing, "Just call me Angel in the morning."

Jeese James Masyr and the Bronx Terminal Market

We've always had a great deal of respect for Jesse Masyr who we feel is the premier land-use attorney in NYC. His latest foray at the Bronx Terminal Market only reinforces this belief. Masyr, by orchestrating the certification of the project in July, has guaranteed that the development will most likely be sent to the City Council on December 19th.

What this all means is that it will be extremely difficult for the body, winding down one Speaker's term and plotting over his successor, to properly deliberate over the merits of the plan. In addition, with the Bronx holding some important cards in the successor fight, it will be difficult for those vying for power to not act slavishly.

At the same time, the fact that Gateway is a re-zoning and not a simple special permit means that extricating the BJ's from the deal will require a great deal of ingenuity. The Bronx delegation is going to be put under a lot of pressure and the putative Speaker aspirations of Joel Rivera may well be conjoined with the Gateway fight. It will certainly be quite bloody before it's all over.

Wal-Mart in the Middle

The fact also remains that the Gateway EIS has identified Sam's Club as a potential tenant. Therefore, it is quite possible that the BTM fight will be made into a battle over the Walmonster. If that happens, watch out! The man in the middle of all this will be BP Carrion who is already under scrutiny for his close ties to Related. Adolfo may feel that real estate money is essential for his desire for city-wide office but the more that all this looks like it isn't an arms length transaction the greater the possibility, clouding any race in four years, that the BP's moniker will become "Cash-and-Carrion."

Another Wal-Mart Lawsuit

Just in case you haven't been following it, Wal-Mart has been accused of denying hundreds of thousands of employees lunch breaks and requiring them to work overtime without proper compensation. For more information check out Wal-Mart Watch and this AP Story.

BJ's, Target, and Home Depot at the BTM

We have learned from a reliable source that Related has signed leases with BJ's, Target and Home Depot at the Bronx Terminal Market site. The BJ's lease confirms what we have known for a long time: despite disavowals from Bronx electeds, BJ's is being finessed through under the cover of the so-called greater good of the Gateway development. It is time for a number of folks to come clean. Tell the truth, state your position and invite the disagreement rather than pursuing a cowardly rope-a-dope strategy of disingenuous denial while the project moves through ULURP.

In this regard, UFCW reps met with Adolfo Carrion on Tuesday and expressed their position on BJ's. He promised to get back to them and tell them whether he would support a strategy of seeking a "restrictive use" covenant that would preclude a box store selling food on the BTM site.

Marino Organization Does Stand-Up Comedy

In a comedic sidebar to yesterday's BTM press conference the Marino Organization, the PR firm for Related, issued a rather funny press release in support of the project. The humor emerged from their description of Community Board #4's "exhaustive" review of the Gateway project. If more than one of the Board's members actually read the 500 page EIS it would be a seismic shock to the community that, certainly not represented on the Board, generally ignorant about or opposes the development.

In fact, the Bronx board harkens back to that cradle of democracy in the Soviet Union: The Politburo. But we do appreciate that the puppet masters allowed two conscience driven members of the Board to vote in the negative. Good thing there is no Bronx Gulag.

The last time Frank Marino was this funny he was carrying around a cardboard cutup of Assemblyman John Dearie who was absent from campaigning because he was struggling through law school. I guess when you have all of the ammunition on your side, not to mention the Wal-Mart account, you can afford a little sense of humor (You certainly don't need a great deal of creativity).

Press Conference Recap

Yesterday’s press conference went very well. In the packed Red Room of City Hall, Stanley Mayer of the Bronx Terminal Merchants Preservation Association announced a rent strike, saying that the merchants would no longer pay disproportionate rent to a landlord that is hampering their businesses and trying to evict them. In other words, as Mayer remarked, “We are not going to fund our own executions.”

Anthony Miranda of the National Latino Officers Association spoke eloquently about the need to promote not just billionaire real estate developers but minority small businesses. He said that as a law enforcement organization he is extremely concerned about the sweetheart deal that led to the eviction of the merchants and is sending a letter to both the U.S. Attorney's Office and the New York State Attorney General asking for an investigation. Miranda pointed out that the relationship between Steve Ross, the President of the Related Companies, and Deputy Mayor Dan Doctoroff needs to be thoroughly scrutinized to see whether it influenced an agreement larded with subsidies, no bid-contracts, sole-sourced land swaps, and unbelievably low rent.

Councilmen Monseratte and Barron were also phenomenal in their defense of the market wholesalers and critiques of the city. Each remarked that the predominately minority merchants were shining examples for communities of color in NYC, ones that often have high unemployment rates. The fact that the city could treat them so badly, said the councilmen, showed its disregard for small businesses, immigrants and minorities. Greg Bell, a representative of the community group Bronx Voices for Equal Inclusion also spoke, offering support to the merchants and remarking that Related has time and again failed to include the South Bronx in a development that is purportedly supposed to be benefiting the area.

Here are links to the coverage available online:

NY1
Juan Gonzalez’s Daily News Column
New York Daily News Story
New York Post
Bronx 12
WNYC
El Diario

Also in attendance were NBC 4, WBAI, 1010 WINS, WB 11 and HOY.

Intro 711

There will be a hearing at the City Council on Intro 711, a bill that would limit the ECB's power to unilaterally raise the fine levels on small business beyond those that are established by statute or local law. As many small business people are aware, ECB has attempted to do just that in the past.

This is all part of Bloomberg’s rapacious regulatory policy that has targeted neighborhood retailers for the past four years. If reelected we can not only expect more of the same and we should be prepared for a lot worse. The Council bill should be vigorously supported by every retailer.

"Bloomberg Tacks Left"

The headline alone is priceless. Patrick Healy's piece yesterday morning in the NY Times about the mayor's lurch leftward underscores what has been obvious to some of us for a while: Mike Bloomberg really has no core beliefs. He is, in Tom Lehrer's immortal description of Werner Von Braun, "A man whose allegiance is ruled by expedience", and, as the Times' use of "tacking" indicates, someone who would be at home in John Kerry's lycra windsurfing bathing suit.

So now, faced with an apparently united Democratic Party, the mayor is trying to distance himself from his Republican marriage of convenience. The first sign was Miguelito's foray into legal scholarship and his negative review of Judge Roberts' qualifications for the Supreme Court. Yesterday Bloomberg discovers some problems with the minimum wage waivers in the Katrina relief effort. All of which is patently transparent, somewhat like the spontaneous show of support in the 1,000 house parties arranged for the mayor's reelection.

This nimbleness of the mayor opens an opportunity for Ferrer. No, not just the reinforcement of Bloomberg's faux Republicanism. The opportunity lies in aggressively demonstrating that the mayor, like any run of the mill pol, will say or do anything in his own interest. The best example is the mayor's 2001 pledge to not, unlike that liberal Mark Green, raise taxes. Another is the mayor's failure to even mention that he planned to turn over economic development to an Olympics-crazed czar who would in turn look to turn over public property for a song to his billionaire friends.

Which brings us to this election. Clearly the mayor, with no core beliefs and contempt for the average citizen, simply cannot be believed if he decides to finally tell voters what his plans are for the next four years. The average homeowner and small businessman should be frightened indeed. If another budget crisis hits watch for taxes to skyrocket, fire houses to close, and enforcement actions to escalate.

Rent Strike/Call For Federal Investigation

Today at 2:00 p.m. on the steps of City Hall, the Bronx Terminal Market merchants will declare a rent strike against the Related Companies. The merchants will charge Related with failing to perform is legally-obligated landlord duties, using the rent money not to maintain the market but for its own development and legal costs. Currently the merchants pay $280,000/month to Related while Related pays only $22,000 to the City. Merchant association president Stanley Mayer will say that there is no reason for this gross disparity and that the merchants should not be funding their own evictions.

Mr. Mayer will also discuss the merchants’ frustration with the city. More than a year after the Bronx Terminal Market redevelopment was announced, the merchants still have not been offered a viable relocation plan. This is made more egregious considering that Related, whose president Steve Ross is very close to the Deputy Mayor, has been bequeathed subsidies, a no-bid contract and an unbelievable lease deal.

Also in attendance will be Councilmen Monserrate and Barron as well as a representative from the Latino Officers Association (LOA). The LOA, with the support of the councilmen, will announce that they’re sending a letter to the U.S. Attorney requesting an investigation of the entire deal that brought Related to the Terminal Market and resulted in the attempted eviction of the wholesaler tenants.

For more details about the event download the full release.

Memo to Freddy: Hire Wayne Barrett

In this week's Village Voice, columnist Wayne Barrett unveils a brilliant political-policy speech he has graciously written for Freddy Ferrer. The speech is not only one of substance, hitting as it does on all of the weaknesses in the mayor's record, but it has the kind of passionate style that Freddy needs to adopt if the Barrett-written narrative is to be fully effective.

Everyone should take a look at the piece; it is the kind of writing that makes all of us envious and harkens back to Wayne's seminal work on Giuliani. It was particularly good to see him focus on the property tax issues that the Alliance has stressed but he does so in the context of his discussion of structural poverty. His call for a job development strategy that doesn't give city land away to suburban-style real estate developments was right to the heart of the mega-development toadying that is the hallmark of this administration.

The coup de grace of the piece was Barrett's wicked reminder of the Bloomberg pledge to not repeat his obscene campaign spending of 2001 because it would indicate that he had failed to adequately get his message out to people and convince them, absent another monetary deluge, of his administration's achievements. This reminder, one that should be constantly repeated, is necessary to somehow turn the mayor's campaign spending spree against him.

Freddy and the Bronx Terminal Market

Tomorrow, Wednesday, September 21st, the merchants at the Bronx Terminal Market will be joining with the Latino Officers Association (LOA), and members of the community at a press conference at City Hall. The merchants will announce that they will no longer be paying rent to the Related Companies because the developer is not performing its legally required landlord duties.

The merchants, who are currently paying Related around $280,000/month while the company is only paying the city $22,000/month, are tired of the city's lack of good faith and foot dragging when it comes to any meaningful relocation plan. In addition, they are no longer willing to see their rent money being used for their own execution. The city appears to have unlimited funds for the Gateway Mall, is eager as well to giveaway valuable city property to Related, but is unwilling to lift even a finger for the beleaguered small businesses at the BTM.

The LOA will be sending a letter to the US Attorney's Office requesting that a full-scale investigation be launched into bid rigging and collusion between the city (In the person of Deputy Dan Doctoroff), and Related's Steve Ross. They will all be joined by Councilmembers Monserrate and Barron who will be pressing the merchant's case.

It is now the right time for Freddy to become actively engaged with this signature issue. The BTM, more than any other issue, symbolizes the mayor's total lack of concern for small, especially immigrant, entrepreneurs and his complete disregard for neighborhoods. We urge Freddy to join the fight.

Anti-Wal-Mart TV Commercial

For the last few months in particular, Wal-Mart has been flooding New York City’s air waves with commercials touting the big-box store’s “everyday low prices.” In response, the Brooklyn-based group Wal-Mart No Way has done something amazing: it has produced its own highly professional TV ad pointing out the high costs of Wal-Mart. The spot, emphasizing the retailer’s affect on neighborhood business, traffic and lower overall wages, will be running on New York 1 and can be downloaded and Wal-Mart No Way’s site.

There will be a press conference today at 10:30 a.m. on the steps of City Hall unveiling the ad and asking New Yorkers to let Mayor Bloomberg know that Wal-Mart is not welcome in New York City.

Property Taxes to Rise

The NY Times reported on Saturday that homeowners will be facing a 4.3% rise in their property taxes a rise that reflects the jump in the value of city real estate. This is precisely the campaign issue the Anthony Weiner had used to get the boost that pushed him into second in the Democratic primary.

As Weiner appropriately pointed out, the increase in the real estate tax in 2003 was not the 18 or so percent but was really closer to 40% if rising propery assesments were factored in. Now it appears that more is to come. As our old ally Seymour Scwartz of the Briarwood Civic Association says, "The noose is tightening." Schwartz rightly points out how these rising rates impact working people who will also be facing skyrocketing fuel bills this winter.

The question remains here as to whether the Ferrer campaign will be able to capitalize on this issue. Certainly the response of the mayor's spokesman that the city's $400 rebate is "a way to cushion the blow" indicates that an aggressive attack on the mayor's tax targeting of homeowners and small businesses could do for Freddy what it did for Weiner. Clearly a property tax reduction and not a rebate is "the most effecient and substantive way to provide relief to small homeowners in this "red-hot real estate market."

Bloomberg's Vetoes

As expected, Mayor Bloomberg vetoed two bills yesterday that would have varying impacts on neighborhood stores. The first measure, the Health Care Security Act (HCSA), would mandate that employers in the grocery industry adequately cover their employees' health benefits. The second bill would create an additional layer of oversight for the city's 2,000 fruit and vegetable stands.

The HCSA has generated some concern from the independent supermarket owners who feel that the bill's thresholds, i.e., those sections that would trigger the mandated coverage, would unfairly burden smaller operators as well as the big box stores that were the real target of the UFCW and the sponsors of the legislation.

The mayor's rationale in the first case was that the HCSA, "Violates federal law" and is "arbitrary and capricious" for singling out one industry. The override battle, which should take place in early October seems to be a foregone conclusion since the health care legislation was passed overwhelmingly. There is, however, a great deal of sentiment in the Council to amend the bill to address the concerns of some of the smaller supermarket owners. In discussions with our union friends it appears that they would support some changes in the law that would raise threshold triggers.

On the fruit stands the mayor's veto addressed the "unnecessary inspections", ones that would be required even if there were no complaints. The bill gives the DOT the requirement to conduct pedestrian traffic studies and creates more expense for store owners as well as an additional barrier to licensure for small businesses that are already struggling.

The Alliance will be involved in both efforts, trying to amend the HCSA as well as trying to sustain the mayor's veto of the fruit stand law. As we have already mentioned elsewhere this bill was passed without adequate time for proper deliberation and we feel hopeful that the Council will consider this when they take up the override.

There is already too much unnecessary regulation of neighborhood stores and there are other ways to address Councilmember Liu's concerns about congestion in Flushing that don't require a law that affects all the other neighborhoods of the city. In this override fight we will be working with the Korean-American Small Business Service Center as well as other neighborhood business groups.

Freddy and Wal-Mart

While Anthony Weiner took the lead against Wal-Mart, with Gifford Miller a close second, Freddy was relatively quiet on the issue of the big box retailer. Now that he is the nominee, retailers and supermarket unions are watching what Freddy will do to advance the campaign against the box store juggernaut.

If the Ferrer campaign is smart they will seize upon this issue because it has the potential to help Freddy to reach a number of constituencies that he has yet to strike a chord with. As we have pointed out in our conservative case against Wal-Mart, there is a strong aversion to box stores in many of the city's white working class neighborhoods. That is why conservative pols like Denis Gallagher, Tom Ognibene, and Jimmy Oddo have staked out anti-Wal-Mart positions, joining their more progressive colleagues who oppose the store because of its anti-labor policies.

The anti-Wal-Mart campaign has the potential to enable Ferrer to work with and appeal to a broad-based constituency in every city neighborhood. Specifically, it will enable him to make inroads into Staten Island where Wal-Mart has proposed two sites. From the conversations we’ve had with civic leaders, parents and politicians, Staten Islanders are sick and tired of overdevelopment and retail over-saturation. These homeowners may not care about Wal-Mart’s anti-union philosophy but they certainly are concerned about the destruction of their neighborhoods through increased traffic and crime and decreased property values. It makes political sense for Ferrer to harness this neighborhood-based, anti-Wal-Mart sentiment, attending some of the upcoming Staten Island community forums and becoming more vocal on the issue.

In addition, positioning himself against the box store will allow Freddy to attack the mayor, who has already staked out the pro-Wal-Mart position. The thrust of the attack, however, has the added bonus of permitting Ferrer to paint Bloomberg as a dependable toady of the rich and powerful, a theme that we have underscored before in our discussions of Deputy Dan, Steve Ross and the BTM.

BJ's Redux

The Daily News has picked up on what we have reported earlier: BJ's, and its faithful Related Companies sidekick, has re-submitted its application to build a 140,000 sq. ft. store on Brush Avenue in the Bronx. This time, according to a spokesperson, they will actually undertake a socio-economic impact analysis, something that the company had originally failed to do last year and, even more troubling, a less than diligent City Planning Commission had failed to require.

Not that we're sanguine that the company's bought and paid for analysis will shed much light on the giant retailer's impact; we’re still reeling from a similar study done on the impact of a box store at the proposed Gateway Mall at the site of the BTM. As we have commented on earlier, that "study," a term paper that wouldn't get a passing grade from even a non-accredited institution, humorously predicted that a big box store selling over $60 million dollars a year in groceries alone would not negatively impact a single Bronx or upper Manhattan supermarket!

What's interesting in the story today is the comments of outgoing Councilwoman Madeline Provenzano. Maddy expresses unhappiness about the failure of Related to even consult her and also harbors ill will for the lack of support she got for standing up – all alone – for BJ's last year. In addition CB#10's district manager and Democratic nominee to replace Provenzano, James Vacca, expresses extreme skepticism about the store and, somewhat surprisingly, so does his Republican challenger Phil Foglia. Foglia in fact mimics are conservative arguments about box store impacts on neighborhood business. All-in-all, not a good sign for BJ's.

The renewed BJ's application in the East Bronx also underscores a point that we made last year: its not just about one store! At the time, we predicted that the Brush Avenue site would be followed by others until six or seven such retail outlets – not all of them BJ's – would ring the borough. Individually these stores have a major impact. Cumulatively, however, their effect on the existing neighborhood food businesses would be devastating.

That is why we fight so vehemently when the box stores invade. The business model calls for saturation and the elimination of the competition. The overall impact would lead to the killing of the city's Main Street small businesses. This is why we called for a box store moratorium last year. It would allow for time to study the cumulative effect of box store proliferation on the city's economy.

We renew that moratorium call today. All the developers talk about are the putative benefits of these big boxes they never do more than gloss over their collateral damages. This is a great topic for the newly constituted Council to take up in January.

Community Board versus the Community

Last night Bronx Planning Board #4 voted 21-2 to approve the application for Related’s Gateway Mall redevelopment. Though the result was unsurprising, it was interesting to see the contrast between the community’s and the board’s sentiments about the project.

During the public comment period, a number of questions were raised about the development including its lack of community inclusion, its potential harmful effect on air quality and asthma, and the deficiencies in the developer’s EIS. Except for a couple of representatives from the building trades, the overall response from the crowd was one of skepticism, concern and anger.

Despite this palpable sense of apprehension, the Board overwhelmingly voted in favor of the Gateway application. Sadly, a body that is supposed to represent its community instead unquestioningly moved ahead on a project that could potentially negatively impact upon its neighborhood. As we have commented before, this just underscores the problems with the ULURP process, one that, in theory, is supposed to increase democratic participation in development but in reality often shuts out the community.

Specifically, one has to wonder how many board members actually read the developer’s 500+ page EIS? Considering that the board only had a couple of weeks in which to review the application and considering that many had already made up their minds, the educated guess is that very few knew the important project details. Instead most voted yes based on superficial knowledge gleaned from a biased developer presentation or due to political pressure from Gateway-supporting elected officials.

It must be noted that there were some notable exceptions to this sad story. Land Use Chair Mary Blassingame and another board member (whose name escapes us right now) courageously voted no due to the credible, unanswered concerns they heard coming from the community. We hope that the City Council takes this into account and demands answers from Related prior to granting any approvals.

What Freddy Needs to do

The gracious concession of Anthony Weiner clears the way for Freddy Ferrer to immediately concentrate all of his efforts on trying to defeat the billionaire incumbent in November. The task is clearly formidable and will require a great deal of ingenuity and creativity. An orthodox campaign will simply not work. Freddy needs to find ways to throw Bloomberg off balance, force him into situations that require spontaneity, and challenge him in directly personal terms.

In doing so he needs to somehow use the mayor's great wealth, a fortune that he pretty much pledged not to use in his re-election campaign, against him. This strategy, however, can't be employed in any crude redux of the "two cities" theme that was used against Freddy four years ago.

One of the best issues to use in this regard is the BTM eviction of the market merchants and the mayor's promise to do the same to the businesses at Willets Point, where Bloomberg famously remarked that, "the land is too valuable for the businesses that are on it." The issue here is an economic development policy of favoritism for the well-connected and well-heeled.

In the same vein the mayor's response to the complaints of bodegas that the so-called "bodega tax" on tobacco was costing the small neighborhood stores around $250 million a year ("It's a minor economic issue"), points to the same "mind over matter" economic royalist attitude that sees the little guy-small store owner or average citizen- with disdain.

In addition, and Freddy knows this issue really well, the cozy relationship between Doctoroff and Related's Steve Ross can be effectively dramatized and used to symbolize the way that economic development in Mike Bloomberg' world is based on "patricianage". Just as the merchants can be evicted in the BTM, using the pretext of a phony "public market clause", so can the Fernandez brothers be by-passed on Bradhurst Avenue as Doctoroff-Bloomberg push crony aggrandizing deals in the name of economic development.

The entire economic development strategy here rests on mega-developments that overwhelm local communities and push out small businesses. The end result, as published reports show, is the increased poverty rates in NYC that demonstrate how economic progress is far from being a rising tide that lifts all boats.

Of course in this regard the entire debacle on the West Side needs to be re-visited. The more Freddy can make this election about Steve Ross, Steve Roth and Woody Johnson the more he can simultaneously hit out at the mayor's obscene spending levels. How many fire houses and day care centers could be opened with the money the mayor is spending? Why, if he has such a great four year record, does Bloomberg need to spend $100 million to convince the public of what should be self-evident?

Ratner's Exceptional Project

Yesterday the Alliance's Richard Lipsky testified on behalf of the Atlantic Yards project at the MTA. FCRC has retained him to organize grassroots support in the amateur athletic community for the development. As part of this effort he is working with a broad base of community and sports leaders to establish the Brooklyn Amateur Sports Alliance (BASA).

The BASA already has the support of over 60 amateur sports and community groups in the borough. There is a strongly held belief that the Nets coming to Brooklyn presents the amateur sports community with a unique opportunity to enhance their work with the borough's boys and girls. They are absolutely correct.

We have already gotten the commitment of FCRC to partner with the BASA in the promotion of amateur sports in Brooklyn. This commitment, however, goes way beyond simple hooping. The BASA plans to not only promote athletic events (Like the upcoming borough-wide basketball tourney that we are planning), but to find ways to use the passion that the youth of the borough have for sports to promote academic achievement, clean drug-free life styles, and career goals.

FCRC is not supporting the BASA out of a purely altruistic motivation, even though no one here will ever question Bruce Ratner's charitable impulses. The support of the BASA is derived from the best instincts of enlightened self-interest. The Nets are coming to Brooklyn without any fan base. The promotion of the amateur athletic community and the concomitant use of sports to help young people to better succeed in life will, at the same time, help the Nets in the creation of an enthusiastic fan base in Brooklyn. It’s the classic win-win situation.

This is what makes the project exceptional for us. The basketball team will act as a catalyst for community by bringing the borough together across racial and ethnic lines. The Nets, working with the BASA, will also act as a positive force for the education and socialization of Brooklyn's young people. These factors, if utilized properly, have the potential to be a greater force for good in the borough than even the jobs and the housing that the project itself will undoubtedly create.

BJ's to eVACCAuAte

With the primary win by Jimmy Vacca on Tuesday in the race to replace Councilmember Madeline Provenzano in the East Bronx it appears that the Related Companies will have a hard time in the effort to resurrect the BJ's application for the site on Brush Avenue.

The application was resubmitted by Related because the company, when they saw the handwriting on the wall last February, withdrew it rather than face certain defeat in the Council. This withdrawal made it permissible to bring the proposal back without prejudice.

In our discussion with Jimmy Vacca today, however, he reiterated his strong opposition to the box store and responded to us by saying, "Why on earth did they do that?" Our response was that Related must have been anticipating a victory by Steve Kaufman.

The Vacca primary victory will galvanize all of the labor forces that were place holding with their support of Brother McManus, a fellow union member. There will undoubtedly be a full mobilization since the Throggs Neck-Morris Park district can mount a serious challenge from Republican Phil Foglia in November.

With a Vacca victory in November the Brush Avenue site will be facing the opposition of both local councilmembers since Annabel Palma who represents the contiguous area of Soundview, led the successful opposition to BJ's last winter.

Weiner to Concede

Anythony Weiner will concede at a noon press conference today. We'll have more reaction on this later.

BTM Merchant Relocation

The Daily News is reporting today that the merchants at the BTM are exploring the site of the Skate Key roller rink as a possible relocation venue for the market. The site works from an accessibility standpoint, only a few blocks south of the current market and right down the street from the 138th Street Bridge. It would also enable the merchants to all relocate in the same spot, a requisite for their ability survive in a one stop shopping environment.

The key stumbling block of course is money. As we have reported, the city has been resistant to any effort at funding the relocation effort. EDC in particular has gone out of its way to disclaim responsibility for the fate of the market in spite of the fact that it is this agency that allowed the market tenants to be evicted and has greased the Related Companies development effort. We remain, as always, skeptical of the city's honorable intentions here.

Job Gains small, Rat gains Large

Buried in the usual glow emanating from the Mayor's Management Report is the news, best highlighted by Glen Thrush in Newsday, that the city's rat and roach population, despite increased extermination efforts, has continued to climb. As the mayor aptly put it, "The city has put out traps and poisons at a record rate...Whether we're really staying ahead of the rat population, nobody knows."

Well, perhaps all the complainants have a better handle on the problem considering they experience it from the front lines. The growing infestations that these people deal with only points out what we have been saying all along about the issue of putrescible garbage disposal and the city's reluctance to promote the use of commercial food waste disposers and more residential disposers as well.

The city's increased use of poison and traps is simply not going to do the job. The only effective strategy is to dramatically reduce the vermins' food supply. This is precisely what garbage disposers do. They eliminate the vector problem at its source: the neighborhood restaurant, green grocer, bodega and supermarket.

In the process they also alleviate the escalating expense that these stores have experienced in the past four years, as disposal rates, set by the city, have doubled and tripled. Escalating disposal costs are just another manifestation of the hardships suffered by small business under Bloomberg's watch.

That is why the Alliance has been promoting Intro 220, a bill that would legalize the commercial use of disposers. With the administration continuing to resist, the Council is poised to implement a pilot program, hopefully starting sometime this fall.

It goes without saying that the reduction of putrescible waste will also become germane as the Council tries to fine-tune the mayor's feeble SWMP, a disposal program totally devoid of meaningful waste reduction. The issue will also become heated because we predict that the communities that are threatened by transfer stations will focus on the SWMP's failure to address waste reduction.

"Community Board" and the BTM

In the continuing demonstration of what's wrong with the city's land-use review procedure, Community Planning Board #4 in the Bronx took its first step toward the approval of a mammoth development project at the site of the BTM. The board did this, as we mentioned last week and as the Daily News reports today, at a vote last week of its land use and municipal services committees.

What's truly fascinating here is the role of a municipal services committee in a land-use vote. In an effort reminiscent of one of the great events in American history, FDR's lamentable attempt to pack the Supreme Court, Bronx Democratic leaders, sensing that the project would be defeated if only reviewed by the land use committee, simply added another committee and proceeded to add a few new members to it-just in case.

So the folks on the board ignored the community concerns, the fact that the ULURP was certified in the summer to avoid scrutiny, the fact that not a soul seems to have even bothered to glance at the 500 page aggregation of misleading info submitted under the rubric of an EIS, and faithfully voted as they were told.

No one on the municipal services committee seemed to have been at all concerned that the merchants at the BTM site might have been illegally evicted from their businesses. Nor, it seems, did anyone even briefly glance at the questions raised about the less than adequate traffic analysis provided by Related’s consultants. Memo to CB#4: There will be a quiz on the EIS on Wednesday. Anyone failing will be in line for the next district manager spot.

Set Asides and Bloomberg's "Patricianage"

On Saturday the Post editorialized against Mayor Bloomberg's executive order 71, an edict that resurrects the old Dinkins set-aside program for minority and women-owned businesses in city contracting. While not setting any strict quotas, the Order does establish a "goal based program" to increase the participation of the targeted firms.

As we have said on other occaisions we're not big fans of set-asides. In our view, and we have advocated on quite a few occaisions for minority businesses looking for city contracts, this kind of approach encourages a dishonest "booty capitalist" system with bogus front companies allying themselves with majority-owned firms.

That being said, however, it is important to point out that the current contracting system cries out for reform. Under Mayor Guiliani, praised by the Post for scuttling the Dinkins set-aside program, the awarding of development rights was strickly based on one's political loyalty to the mayor. So much so that we've described the Guiliani slogan: "One City, One Standard", as more aptly named "The Double Standard." Favoritism was simply given a lighter and greener pallor. In Guiliani's world, making room for up and coming minority entrepreneurs was simply never even considered.

Which brings us to to the Mayor Bloomberg. The key issue is always opportunity and fairness. Reaching out to minority entrepreneurs, and not just for a few subcontracting crumbs, should be part of any administration that is looking to encourage the greatest degree of inclusiveness. This is something that this mayoralty has not done.

The reason that it hasn't is because of the man in charge of economic development, Dan Doctoroff. The Deputy Mayor has raised favoritism to a new level so much so that we believe it deserves its own term: "patricianage." We are referring, of course, in particular to the relationship between Deputy Dan and Related's Steve Ross.

The deal at the BTM, as we have pointed out exhaustively, is one of the prime examples. No-bid contracts with city syrup sweetening the packages is the hallmark of the Dan-Steve collaboration. If you are going to advocate for "one standard," as the Post does, then you are under the obligation to examine how the city contracting process actually works. If you don't, you put yourself in the position of decrying favoritism while turning a blind eye to the kind of unequal treatment that gets overlooked because it is seen as business as usual.

Related, Ross and the Bradhurst Development at 145th Street

The most eggregious example of patricianage in the agrandizement of Related came right at the start of the Bloomberg term. In February, 2002, at the same time that Deputy Dan was requesting a conflicts ruling from the COIB about his relationship with Steve Ross, he personally intervened in the Bradhurst development contract that had been languising in the final days of the Guiliani administration.

The reason the development was on life support derived from the failure of Related to properly gauge the full scope of the development costs. Having failed to do so the developer, hat in hand, had come back to the city for additional subsidies.

The problem here was that a number of other folks had bid for the development rights including the Fernandez brothers whose company, M&M Enterprises, owns five supermarkets in the Bradhurst area. Since the Bradhurst project included a supermarket as well as housing, the Fernandez bid had a great deal of merit. M&M, grossing over $50 million a year, was also backed be the White Rose Food Corporation and Chase Bank, making it a substantial bidder.

It would seem, as the Post editorial suggests, that the city should be awarding bids based on expertise. When it was shown, however, that Related, with billions of dollars of equity, couldn't do the Bradhurst deal without additional city funding the award should have been withdrawn and a new bid process begun.

In fact, when Related came to the city for more money in the previous administration then Deputy Mayor Rudy Washington, the one man in the Guiliani crowd who had a sense of fairness and decency, flatly turned Mr. Ross and company down saying that if the city was going to subsidize anyone than it should be local minority entrepreneurs like the Fernandez brothers. That is the kind of simple equity that doesn't exist when the cronyism of the mega-wealthy dictates policy (Is anyone really surprised that Rudy Washington, as loyal a soldier as anyone in the previous administration, seems to have been the only one not included in Guiliani Partners. Yet Bernie Kerik was!).

Post Needs To Examine Bradhurst and the BTM

One of the catchy lines in the Post editorial was the observation that set-asides lead to "corruption, overpricing and less-than-top-services." We agree, but only if the concept of set-asides is expanded to include the setting aside of city property for Deputy Dan's good friend.

Any comprehensive examination of the BTM deal will reveal that in the sale of the property and in the "negotiation" of the 99 year lease the evidence of corruption and overpricing is manifest. So our advice to the Post is to keep advocating for a level playing field but do so with an eye towards exposing those occasions where old fashion political payoffs or cronyism give unfair advantage, at the expense of city tax payers, to the well-connected.

Union leaders, politicians mount attacks against Wal-Mart

The Staten Island Advance covered an anti-Wal-Mart rally held on Wednesday sponsored by organized labor. The event is part of a 5 borough-wide campaign to educate New Yorkers and convince politicians that "There's more to life than cheap underwear." From the Advance:

Standing in the parking lot of Pathmark in Port Richmond on a star-spangled trailer -- plastered with the names of anti-Wal-Mart Web sites and a flunking report card -- union members and politicians took turns at the podium airing their gripes about the multibillion-dollar company, which they say treats workers unfairly in a quest to offer low prices that choke out mom-and-pop businesses.

...

Wal-Mart, said state Sen. Diane Savino (D-North Shore/Brooklyn), is the "epitome of what is wrong with corporate America, and what is right with the labor movement."

The Neighborhood Retail Alliance's Richard Lipsky also chimed in:

"Wherever Wal-Mart comes, Main Street closes," said Richard Lipsky of the Neighborhood Retail Alliance.

Health Care Security Act and Fruit Stand Bill

The Council recently passed to bills that all involved believe will be subjected to a mayoral veto. The first, the Health Care Security Act, places a responsibility on employers in the grocery business to provide health insurance for their workers. The second bill increases the amount of oversight for the permitting and licensing of so-called fruit stands. Each law in turn has generated opposition in the impacted retail sectors.

In the case of the health care legislation, concern emanates from the independent supermarkets represented in large part by the predominately Dominican National Supermarket Association. The Alliance has worked closely with the NSA over the past decade on a wide range of policy issues. In that time we have repeatedly urged the group to become more active, and smarter politically. If properly organized and motivated the 400 store group could become a real force on the local political scene.

So far, however, the NSA has kept away from real conscious political mobilization and has relied on the Alliance to represent its interests on such issues as megastores, garbage disposers, and the expansion of consumer affairs regulations.

Which brings us to the HCSA. With the Alliance taking a bystander role, out of respect for its labor allies, the HCSA moved smoothly towards eventual passage. We did intervene on a minor level at the request of one store owner to help amend the bill in the area of the employee threshold that would trigger compliance. At the same time, we did make sure that everyone in the retail industry was aware of the bill's parameters and implications.

In spite of this outreach the NSA and some of their wholesalers remained on the sidelines, never weighing in on the merits of the bill from their perspective. That is until its passage. Now there is a great hue and cry over the law's implications and the NSA is finally activated politically.

In this regard we have been asked by a number of folks to help find ways to amend the bill and mitigate its potentially negative impacts on some retailers. We have begun this outreach with the labor people as well as with the bill's sponsors but the entire situation is a cautionary tale for the industry: you need to be involved and aware in the protection of your own interests or else face the consequences. It is a lot easier to influence legislation in its early stages than after sides have coalesced.

In Liu of Common Sense

On the fruit stand side the Korean Small Business Service Center is extremely worried about Intro 699,a bill that would greatly increase the licensing expense and the enforcement exposure for all fruit stand owners. The bill, sponsored by Councilmember John Liu, was passed at the last Council Stated Meeting without the benefit of needed debate and deliberation.

KSBSC's leader, Mr.Sung Soo Kim, is trying to mobilize councilmembers in an effort to sustain the expected mayoral veto of this bill. Councilmember Simcha Felder is spearheading this effort which faces a considerable obstacle; only one mayoral veto (on the transfer station siting), has ever been sustained in the past four years.

Mr. Kim has approached us for help and we believe that it is possible to sustain the mayor's veto, especially if the Speaker doesn't come out of next Tuesday's primary. Our belief rests on the lack of real due process and adequate deliberation. In addition, Mr. Kim is working on a compromise alternative that will, hopefully, convince the handful of councilmembers needed to sustain the veto.