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March 1, 2011, "The Bloomberg Bubble Bursts" Commentary, Fred Siegel
"No Labels? No accomplishments, actually, for New York’s mayor."
"In the narrative crafted by Michael Bloomberg’s public-relations team
throughout the first nine years of his mayoralty, he was the fabulously
successful businessman who saved New York’s economy after the 9/11
attacks and then went on to master urban governance without breaking a
sweat. Along the way, we have been told relentlessly, Bloomberg became
the nation’s leading education reformer, responsible for reducing by
half the black-white achievement gap, while also launching lifesaving
public-health and environmental initiatives.
And through it all, so the narrative went, he remained above the ugly
partisan fray. A lifelong Democrat who turned Republican to run for
mayor on the cusp of his 60s, he quickly transcended both parties and
established himself as a true independent. And so, his consultants
hinted, the nation’s emblematic “no labels” politician might be
available for the highest office in the land so that he could help
repair the politically fractured nation as he has repaired New York
City.
But all that was before the Christmas 2010 snowstorm, when this
protean genius of 21st-century politics somehow forgot the first rule of
New York City governance: the mayor must make sure the streets are
cleared before he sets upon saving the world. As a powerful blizzard
bore down on the city, Bloomberg, as was his weekend custom, was
relaxing at his sunny Bermuda hideaway. Steven Goldsmith, a new recruit
as deputy mayor for operations owing to his efforts at “reinventing
government” during his own innovative mayoralty in Indianapolis in the
early 1990s, was in D.C. for the weekend and declined to return. Howard
Wolfson, another deputy mayor, was vacationing in London. Bloomberg’s
principal deputy, Patricia Harris, was also out of town at an
undisclosed location....
It is tempting to depict Michael Bloomberg’s reversal of fortune in
his third term in office—a term he secured by muscling through a change
in the city’s term-limits law before spending $150 million to win only
50.7 percent of the vote—with hubris metaphors drawn from classical
tragedy. But this assumes there was glory before the fall. In reality,
there never was greatness. There have been no lasting fiscal or
education reforms.
The story of Bloomberg’s mayoralty is this: there is no there there.
It is now abundantly clear that the myth of Bloomberg’s
accomplishments was the result of two forces: his own immense wealth and
the city tax dollars generated by the stock-market surge of the 2000s.
Both sources of revenue, private and public, were used to co-opt and
silence his opposition and thereby allow the glamorized portrait of an
indispensable manager and the guardian of the public purse to be drawn
without countervailing criticism.
An objective accounting of Bloomberg’s tenure reveals the many ways
that Bloomberg’s standing as New York’s richest citizen actually
undermined New York’s democracy, even as the city’s fiscal health and
essential infrastructure deteriorated.
How it began to go wrong
While running for office in 2001 and after being sworn in as mayor in
2002, Bloomberg pledged to be the quintessential managerial mayor. He
promised to resolve the city’s budget difficulties without raising taxes
and insisted there would be no city support for any new stadiums until
the economy—suffering through a recession owing to the post-9/11
aftershock—had recovered. He also said he would negotiate new union work
rules for a more efficient New York. And he insisted that he would lead
the way in rebuilding Ground Zero.
Bloomberg reversed himself on each of those commitments. He ceded
responsibility for the Ground Zero rebuilding to then-Governor George
Pataki and the Port Authority of New York and New Jersey, and then
stayed out of it while they spectacularly mishandled every aspect of the
reconstruction. Later he announced his support for a new stadium for
the New York Jets on the Far West Side of Manhattan.
Because of the city’s damaged financial position in the wake of 9/11,
Bloomberg reneged on his promise and instead proposed a 25 percent
property-tax hike while signing public-sector union contracts that
boosted wages well above inflation without receiving work-rule changes
in return. This was fitting, he believed, for a metropolis that, he said
in 2003, “isn’t Wal-Mart. It isn’t trying to be the lowest-priced
product in the market. It’s a high-end product, maybe even a luxury
product.” You want to live in and around a luxury product? You have to
pay more.
Bloomberg maintained the policing achievements that had changed the city so dramatically for the better during the tenure of his predecessor,
Rudy Giuliani. And he had some modest successes of his own in the early
years. He imported from Chicago a 311 system for quicker access to city
services and handled a brief blackout in 2003 well. New York recovered
from 9/11 more quickly than expected. By the second quarter of 2003,
Wall Street profits were beginning to rebound, and the city was emerging
from the worst of its economic woes.
But rather than holding the line on spending and allowing the city’s
coffers to recover properly, Bloomberg simply reversed course and kept
spending while keeping tax rates high. Even so, he chose to borrow $1.5
billion to help cover the city’s operating expenses. Not since the
catastrophic near-bankruptcy of the 1970s had the city borrowed to cover
day-to-day costs.
The aftermath of 9/11 was an extraordinary lost opportunity for the
city. It could have been a moment when, in the name of shared
responsibility for bringing the city back to life, spiraling labor costs
could have been addressed. Public-sector employees working for the city
labored but 35 hours a week and contributed nothing to their own
health-insurance premiums. Rather than take up the matter, Bloomberg
simply retained the status quo when it came to negotiating with the
city’s most important voting bloc.
A routine was established: Bloomberg
would start out by talking tough about how new contracts could be paid
for only with increased productivity, and in response unions would reply
in a patented and choreographed “anger” mode. This false confrontation
would be followed by a renewal of the old contracts and their
counterproductive work rules with a few cosmetic improvements. Thus the
need for new borrowing.
Bloomberg was, at times, rescued from his own destructive policies by
events beyond his control. In 2004, he became obsessed with plans for a
new football stadium, or a “multi-use” facility in Manhattan, as part
of a quixotic bid for the 2012 Olympics. It was unclear, given the
checkered financial fallout from cities that had previously hosted the
Games, just what New York stood to benefit from securing such a
questionable honor. New York was already the most visited tourist
destination in the United States and fourth or fifth (depending on whom
you ask) worldwide. Nonetheless, as the centerpiece of the Olympic bid,
Bloomberg proposed to bequeath the Jets’ ownership a billion-dollar
parcel for a fifth of that price. The unpopular push for a West Side
stadium left Bloomberg, whose poll numbers had fallen to as low as 31
percent, with a hard road to re-election.
The stadium albatross was lifted from Bloomberg’s political neck
when, despite his best efforts, it was blocked by the Democrats in the
state assembly. Meanwhile, thanks in part to the Bush tax cuts, Wall
Street had come roaring back, not only softening the blow of Bloomberg’s
foolish fiscal policies but also refilling the city coffers.
To cap off this sudden positive turn in Bloomberg’s political
fortunes just as he was about to run for a second term, Bloomberg was
handed a dream opponent for the 2005 general election, Bronx Borough
President Freddie Ferrer. Together with his ally, the rabble-rouser and
riot-inciter Al Sharpton, Ferrer had effectively delivered the 2001
election to the political neophyte Bloomberg by undermining Bloomberg’s
Democratic rival, Mark Green, to whom Ferrer had lost a primary runoff.
In the general election, Ferrer worked with Sharpton to undermine
Bloomberg’s opponent by suggesting that Green, a veteran New York City
left-winger, was a covert racist. The contrived brouhaha suppressed
Green’s minority vote and, almost by accident, Bloomberg became the
mayor.
In 2005, Sharpton played a much different role. He undercut Ferrer,
who had counted on a black-Latino alliance to carry the day, even as
Ferrer repelled moderate white voters with his talk of returning to the
glory days of pre-Giuliani New York. And despite a liberal
campaign-spending law intended to level the playing field, Ferrer was
buried beneath an avalanche of Bloomberg’s money. The mayor’s spending
on political consultants alone was greater than the cost of Ferrer’s
entire hapless campaign. It ended up being a no-contest election for
which Bloomberg effectively paid more than $100 per vote. But his
20-point margin of victory pumped air into the mayor’s trial balloons
about running for national office, which have been repeatedly floated
ever since.
Bloomberg’s second term was strewn with grotesque management
failures. His administration’s one major responsibility, after handing
off most of the 9/11 rebuilding, was safely dismantling the remains of
the Deutsche Bank building, a toxic ruin on the edge of Ground Zero. His
staff handed over the cleanup and demolition to a Mob-connected company
previously blocked from doing business with the city. Two firemen died
horrible deaths as a result of the failure of the fire department to
inspect the mismanaged site. The mayor talked incessantly about the
“accountability” he was bringing to city government, but he never held
his fire commissioner to account for the avoidable disaster at the
Deutsche Bank site.
But nothing illuminates the vacancy of Bloomberg’s mayoralty more
than the false narrative that depicted him as America’s “education
mayor.” At the time he took office, a complex set of rules gave the
mayor relatively little control over public education in the five
boroughs and disseminated authority to such an extent that no one could
be held responsible for the parlous condition of the schools. For years,
Rudy Giuliani had pressed for mayoral control but was denied it. As a
candidate for mayor in 2001, though, Bloomberg offered hardly a hint
that he regarded education as a critical issue or even that he believed
New York’s mayor could do much about the condition of the city’s
schools.
Once settled in at City Hall, Bloomberg looked across the river to
downtown Brooklyn and saw a big, fat inviting target. It was 110
Livingston Street, the Board of Education’s central headquarters,
notorious for its bureaucratic paralysis and recurring corruption
scandals. Bloomberg stepped into the breach and made the city the same
offer Giuliani had: Give me full authority over the school system and then judge me by the results.
Lacking Giuliani’s baggage on the matter, Bloomberg had a leg up. He
waged an effective political and public-relations campaign to convince
the state legislature to eliminate the Board of Education and write a
new school-governance law for the city.
Education became a mayoral
agency.
At the signing ceremony for the mayoral-control bill in June 2002,
Bloomberg heralded a new era of accountability. He promised the
taxpayers that he would now deliver a bigger education bang for their
bucks. He cleared thousands of bureaucrats out of 110 Livingston Street,
sold off the musty old building, and installed a few hundred essential
central-office officials at the refurbished Tweed Court House less than a
hundred yards from City Hall.
He then hired Joel Klein, the former head of the Justice Department’s
antitrust division in the Clinton administration, as the new schools
chancellor. After a six-month review of what was working in the schools
and what wasn’t, the mayor announced his reform program (called Children
First) at his Martin Luther King Day speech in Harlem on February 20,
2003. Bloomberg hit all the right notes, combining a commitment to
fiscal restraint with what seemed like an empirically grounded approach
to curriculum and classroom instruction.
Bloomberg said that the $12 billion the city was then spending on the
schools should be enough to provide a decent education for all children
because he and Klein were now going to “make sure we get the most value
for the school system’s dollar.” Bloomberg also seemed to be rejecting
the progressive-education approach to curricular issues and classroom
pedagogy and casting his lot with education traditionalists. Thus he
announced that there would now be a standardized curriculum for all
schools dictated from City Hall, including “a daily focus on phonics” in
the early grades.
But soon it became clear that, in this area as in others, it was
necessary to pay attention to what this mayor did rather than what he
said. Almost immediately, on the issue of classroom instruction,
Bloomberg and Klein chose to defer to the progressive old guard within
the school system. Lucy Calkins of Columbia Teachers College, one of the
country’s leading progressive educators and a fierce opponent of the
phonics approach to reading, was given a leading role in designing
reading and writing instruction for most schools (to a tune of more than
$10 million in consultant contracts).
Bloomberg also began dipping deeper into the city treasury for more
and more tax dollars for the schools. From fiscal 2003 to 2011, the
education budget grew from $12.7 billion to $23 billion annually—almost a
70 percent increase in inflation-adjusted dollars. Most of the money
was paid out in 43 percent across-the-board teacher-salary increases in
just the first six years of Bloomberg’s tenure. He also added more than
4,000 teachers to the payroll, reaching 80,000—one teacher for every 13
students in the system. But the mayor who prided himself on his business
acumen in managing the city’s workforce obtained almost nothing in
return from the United Federation of Teachers (UFT) for this
unprecedented bonanza.
Indeed, the purpose of the extra spending could not have been to
improve student performance, since he said very plainly that he didn’t
believe there was any connection between the two. Rather it was to shore
up his political prospects and help make his reputation as the nation’s
“education mayor.” Instead of insisting on changes in
teacher-compensation packages that might have reduced the city’s
long-term pension and health-care costs, Bloomberg cashed in his chips
in the coin of either direct political support from the United
Federation of Teachers or its calculated neutrality.
For the last half of the decade, Bloomberg and Klein dominated the
national education-reform debate. They toured the country touting their
signature reforms, including assigning letter grades to schools and
bonuses to teachers and principals as powerful incentives for improving
student-learning outcomes. The indisputable evidence, they claimed, was
in the spectacular gains by city students on the state’s annual reading
and math tests in grades 3 through 8. For example, in just two years the
percentage of students passing the math tests went from 54 percent to
over 82 percent (an unheard-of gain in the annals of education).
From 2005 to 2009, Bloomberg called press conferences to celebrate
the ever-more-spectacular test-score increases. At those events, the
union president, Randi Weingarten, stood next to the mayor nodding in
approval, even though she would confide to associates that the scores
were likely inflated. Bloomberg and Weingarten each had their own
reasons to hype the test scores: Bloomberg to boost his national profile
and Weingarten to lay down a marker for yet another series of teacher
pay increases.
The extraordinary teacher-salary increases bought Bloomberg the
union’s blessing for extending the mayoral-control law in the state
legislature in the summer of 2009. The union also gave Bloomberg a pass
when he brazenly succeeded in overturning a term-limits law that had
been written into the city’s charter so he could run for a third term
(the move also overturned term limits for the city council that voted in
favor of repeal). Later that year, the UFT remained neutral as
Bloomberg faced off for re-election against Democrat William Thompson.
Bloomberg won with a bare majority; a shift of 50,000 votes would have
tipped the race to Thompson. The 43 percent salary increases did little
for student achievement, but it turned out to be a shrewd political
investment for the mayor.
In 2009, during that third bid for office, the Bloomberg education
department gave more than 90 percent of the schools A’s or B’s on their
progress reports. The test-score increases, Bloomberg argued, proved
that his administration had found the silver bullet of reform that could
lift achievement for all American students. And in testimony before a
congressional committee, Bloomberg claimed that the black-white
academic-achievement gap—a conundrum that had stumped education
reformers for decades—had been halved in New York City in just five
years.
And then, in early 2010, the Bloomberg education bubble burst. State
Board of Regents chancellor Merryl Tisch and education commissioner
David Steiner acknowledged that over the past several years, the test
scores had been grossly inflated. Under previous education commissioner
Richard Mills, the two officials said, the questions on the tests
had become more and more predictable, so that teachers were able to help
their students “game” the tests. For good measure, the previous Albany
education administration had also set the “cut scores” for determining the different levels of student proficiency too low.
When the results of the readjusted 2010 tests were announced,
practically all the gains students had made since 2007 were erased. In
2009, 82 percent of students in grades 3 to 8 had supposedly performed
at grade level on the math tests; but on the 2010 tests, that number
fell to 54 percent. In reading, the one-year drop was from 69 percent at
grade level to 42 percent.
Like the snowstorm that damaged Bloomberg politically at the end of
the year, the new test numbers produced a dramatic reversal of fortune
for the mayor. They raised the question of how much of a bang the city
had gained for the billions of dollars in extra education spending by
the administration. Certainly there were modest improvements in student
learning during the Bloomberg years, but there was also modest
improvement in the last few years of the old Board of Education (though
this is rarely discussed). It seems that Bloomberg had had it right in
his first education speech when he noted that there was no correlation
between the amount of money spent on schools and higher student
achievement.
Bloomberg’s administration tried to put the best face on the news. It
was true, Joel Klein conceded, that the extent of student gains in
recent years had been much exaggerated, but it was still true that New
York had done better than the state’s other big-city districts. After
boosting the city’s annual education budget by $11 billion, the
Bloomberg administration was effectively saying, “We’re better than
Buffalo.” That isn’t much of a legacy for a once-upon-a-time would-be
presidential candidate who had put his education accomplishments at the
top of his political resume.
The money problem
When Bloomberg fought and won control of the schools, he said
repeatedly that if people didn’t like his education policies, they could
vote to fire him in the 2005 election and pick a new education CEO.
When asked how New Yorkers who didn’t like what he was doing in the
schools might express their concerns after Election Day, Bloomberg
quipped, “They can boo me at parades.”
Not a bad quip. But it exposes what, aside from the policy failures,
is the most discomfiting aspect of the Bloomberg mayoralty: the mayor’s
use of his own personal resources to buy himself not only political
power but also political peace. In a manner unparalleled in American
history, Bloomberg in total spent in excess of $300 million to secure
office three times from an electorate that numbers fewer than 4 million
people (and of which only a third actually participate).
That is one issue. The other has to do with the way Bloomberg spent
tens of millions of dollars annually between elections to make sure that
not too many influential New Yorkers would risk criticizing him. Mayor
Bloomberg’s predecessors, from Ed Koch to Rudy Giuliani, had also been
tempted, and had at times given into the temptation, to use the power of
incumbency and control of taxpayer funds to reward allies and punish
enemies. The difference is that Bloomberg was able to channel his private
philanthropic giving each year to hundreds of the city’s arts and
social-service groups
with the reasonable expectation that the gratitude
these groups felt to their patron would extend to their patron’s
political causes.
At the very least, it would make the groups and their
influential boards of trustees think twice before criticizing the
mayor’s policies.
The vehicle for Bloomberg’s gifts was the Carnegie Corporation.
During the 2005 election year alone, Bloomberg donated $20 million to
Carnegie, which in turn distributed the mayor’s largesse to 400 arts and
social-service groups in gifts of $10,000 to $100,000. Officially, the
donor to Carnegie was listed as “anonymous,” but as New York Times reporter
Sam Roberts pointed out, all the groups were aware that the generous
benefactor also had a day job at City Hall. “That Mr. Bloomberg is the
source of the Carnegie contributions has long been an open secret and
cannot help but benefit the mayor politically,” Roberts wrote.
There has never been a wall of separation between Bloomberg’s private
patronage and his political machine. Bloomberg’s first deputy mayor,
Patricia Harris, now also serves as head of his private foundation and
monitors the hub, or network, for this intersection of business,
politics, and arts groups. The city’s
Conflicts of Interests Board,
nevertheless, didn’t regard this dual role by the deputy mayor as
troubling.
The breadth of the mayor’s philanthropy proved to be a brilliant
political strategy. When there was some slight pushback in April 2007 to
one of Bloomberg’s new education-accountability policies, 100
“prominent community leaders” suddenly mobilized on the steps of the
education headquarters to support the mayor’s initiative. Most of those
leaders represented arts or social-service groups that were also getting
private charitable contributions from the mayor.
Other groups that benefited from Bloomberg’s private largesse sent
dozens of their employees to testify in favor of killing term limits at
City Council hearings. On the other hand, when a widely respected
organization like the Center for Arts Education publicly objected to how
arts funds were distributed to the schools, the group found out that
its annual Carnegie Corporation grants were cut by 75 percent.
One of the most dramatic examples of how Bloomberg’s wealth changed
the city’s political life was in the transformation of the Reverend Al
Sharpton from racial arsonist during the previous 15 years to statesman
in the Bloomberg era. It would be nice to think that Sharpton’s new
civility and cooperation with several Bloomberg projects took place
because Sharpton finally came to appreciate the genius of American
democracy. But as Sharpton joined the mayor’s network of friends, a
trail of money suddenly appeared going either directly to Sharpton from
Bloomberg’s charity, or from other sources close to Bloomberg. In 2007,
Sharpton’s political arm, the National Action Network, received a grant
of $110,000 from another Bloomberg-funded group, the Education Equality
Project. And the Daily News’s Juan Gonzalez revealed that
Sharpton’s group received another $500,000 gift just as he faced a $1
million lien for unpaid back taxes.
Bloomberg’s ability to buy off potential critics partially explains
why the illusion of his managerial competence and reputation as the
“education mayor” lasted for so long. All the mayor’s billions, however,
couldn’t protect him from the consequences of last year’s crash of the
city’s test scores or his malfeasance during the Christmas weekend
snowstorm. Thus the question of the mayor’s legacy is now finally open
for serious debate.
Thanks to his concentration of wealth and power, Bloomberg was able,
with the aid of a sometimes supine press, to present his personal policy
obsessions as having been endowed with the force of historical
necessity. Thus, when he set his sights on a West Side football stadium
that would have produced massive traffic tie-ups in the center of
Manhattan, the congestion that would have resulted wasn’t considered an
issue. When he moved onto the national stage, a hastily conceived plan to tax
cars for entering Manhattan was patched together to rebrand his
mayoralty as green. But this newfound environmental consciousness had no
binding claim on him; indeed, when he wanted to misdirect public monies
to subvent the construction of a basketball arena on Brooklyn’s main
and often impassible thoroughfare, Flatbush Avenue, the administration
again dismissed problems of congestion with a wave of the hand.
Due to the structure of the city charter, the mayor has almost
complete control of the streets. And Bloomberg has proved himself
determined to create a new streetscape—closing down half of Times Square
to vehicle traffic with plans to do the same for the shopping corridor
along 34th Street in Midtown Manhattan. And then there are the bicycle
lanes, the pet crusade of his second transportation commissioner, a
former business consultant named Janette Sadik-Khan.
In Manhattan and Brooklyn, Bloomberg decreed the installation of
bicycle lanes on many of the city’s heavily traveled commercial avenues.
Little-used and aesthetically unsightly, the Manhattan bike lanes are
so important to the mayor’s vision for the city that they were shoveled
clean even as the streets of the outer boroughs were buried in the
Christmas storm. Throughout the city, the lanes have made it more
difficult to park, made the streets more congested, and made life
miserable for truck drivers and delivery services that had to double
park 20 feet from the curb to complete their rounds.
These undeniable realities do not seem to matter to a mayor who seems
to enjoy imposing change on the city whether it is warranted or not. He
has banned the use of trans fats in food sold in the city, expanded
smoking bans as far as he possibly could, and crusaded against the use
of salt. And he has broken new ground in expanding the already long list
of activities for which Gothamites could be fined. Cars trapped in
snowstorms were ticketed; greengrocers have been fined for “excessive
lettering,” meaning that they posted their telephone numbers on their
awnings. Subway riders were hit for taking up two seats even when no one
wanted the seat next to them, and nature lovers were targeted for
feeding pigeons in the park. If people didn’t want to be fined, said
Bloomberg, they should obey the law. It was only public outrage that
prevented him from placing tolls on the East River bridges, which have
been free to motorists for a century or more.
The connecting tissue of Bloomberg’s policies is Bloomberg’s own
whims and ambitions. After the snow-removal failure, Bloomberg insisted
that John Doherty was “the best sanitation commissioner the city has
ever had.” The New York Post columnist Michael Goodwin wrote:
“In his bubble, that’s self-evident. If the sanitation man wasn’t the
best, the self-declared best mayor would not have appointed him.”
When Michael Bloomberg leaves office in 2014—assuming he leaves
office in 2014—the city will be saddled long into the future with the
massive borrowing and school spending he required to maintain his
political reputation. Citizen Bloomberg will have a significant role in
how Mayor Bloomberg is judged. Already the master of an expanding media
empire, he is now setting up his personal charitable foundation, which
may rival the Gates Foundation in financial assets. That foundation will
no doubt have the resources
to place the Bloomberg legacy of debt,
boondoggles, and bicycle lanes in the best possible light."
..............
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