Gotham Gazette

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What Does It Mean for New York?

The World Is Now Perfect

By Angelo FalcĂłn

As a result of these past elections, peace will return to the world, poverty will disappear, everyone will be able to afford college, socialized medicine will be adopted, civil liberties will be totally restored, torture will cease, foreigners will love us once again, Latino immigrants will all be warmly welcomed, public school teachers will receive starting salaries of $100,000 and Michael Bloomberg will register once again as a Democrat. Our Congressional delegation – Charles Schumer, Hillary Clinton, Charles Rangel, Jerold Nadler, Anthony Weiner, Nydia Velazquez, Jose Serrano and others – will occupy powerful positions in the Congress that will bring billions more into New York City’s coffers. Socialism will finally come to America.

Yes, expectations resulting from this election may be a little out of control in some quarters, but I expect with a little time (perhaps a week) reality will once again set in. True, the Democrats will restore their place as players and agenda-setters in the Congress, but under our federal system of government, they still have to contend with executive and judicial branches that have eroded democracy in profound ways. It will take some time just to get the federal government back to a place where rational policymaking will be possible once again.

The power shift that we have just witnessed must be seen as a first step in a long-term strategy to undo the tremendous damage that the Bush Administration and extreme Republicans have done to the country on so many different levels. This moment must be seen as the beginning of a long fight to return democracy and competence to the federal government, but one whose outcome is not at all clear. Will the Democrats, with an eye toward the 2008 presidential elections, continue to present themselves as Republican Lights, or will they become more aggressive in making sure that this country realizes it promise of equality and fairness? Clearly, this election has raised expectations about what is possible. The question is: can we keep these expectations raised long enough to make the Democratic Party more daring and creative than it has been for far too long?

Angelo FalcĂłn is president and founder of the National Institute for Latino Policy

Congressional Clout

By Jerry Skurnik

With New York City being one of the most “blue” parts of one of the most “blue” states, the election results for 2006 are good news for the city. After 12 years in the minority, the city’s Democratic congressional delegation should have enough influence to be able deliver quite a bit.

The possible changes in national priorities will make the federal government more in line with the thinking of most New Yorkers. But it will be in the fairly obscure work done by Congress – an amendment to a banking bill, a slight change in the formula to fund some projects, a minor appropriation -- where the difference between being in the congressional majority and minority is greatest.

It is already well known that Representative Charles Rangel will become chairman of the most important House committee,Ways and Means; Representative Nydia Velazquez will chair the Small Business Committee; and Senator Charles Schumer deserves much of the credit for the Democratic wins because of his role as chairman of the Democratic Senate Campaign Committee.

But another reason why we will have clout is New York City’s representatives are all on committees that can benefit the city. I am old enough to remember when New York’s Congress members were criticized for caring more about foreign policy and wildlife in Alaska than they were in jobs for New Yorkers. If that was once true, it isn’t anymore.

Every New York City member of Congress is on a committee important to New York. Some are also on the International Relations and Armed Services committees, but we New Yorkers don’t want all our representatives to be too parochial.

Schumer is on the Banking, Housing and Urban Affairs Committee and Senator Hillary Clinton is on Health, Education, Labor and Pensions.

Representatives Gary Ackerman, Gregory Meeks, Joe Crowley, Vito Fosella, Carolyn Maloney and Velazquez are all on the Financial Services Committee.

Representatives Jerrold Nadler and Anthony Weiner are on Transportation and Infrastructure.

Representatives Ed Towns, Fosella and Eliot Engel are on the Energy and Commerce Committee.

Representative Jose Serrano is on the Appropriations Committee.

And some of these representatives now have enough seniority to become sub-committee chairs, which will only increase their power.

I’m sure Mayor Michael Bloomberg and Governor-elect Eliot Spitzer will not get too exuberant over all this. Having Democratic control of Congress is not a solution to the city’s problems – remember Democrats controlled both Houses of Congress from 1955 to 1981 and everything wasn’t great then. But I’m equally sure that both Bloomberg and Spitzer are happier than they would have been if the alternative had occurred and Republicans had increased their congressional control.

Jerry Skurnik, a partner in Prime New York, a political consulting firm, comments on politics for the Room 8 blog.

An Urban Agenda in Congress?

By Douglas Muzzio

The switch to Democratic control in Congress is a dramatic development, particularly for New Yorkers. The changes create limitless possibilities.

One is increased funding for discreet projects – which many call pork barrel – in the city and state. There could be a more urban-centered policy agenda in both houses of Congress. While I don’t know if this will be the case, it is certainly a more plausible possibility than it would have been if the Republicans had retained control.

There are a number of issues the New York delegation might be interested in pushing: immigration and gun control, to mention two. More equitable funding for mass transportation is another. Now, the formula that allocates money is skewed against the city very intentionally, even though we account for a substantial share of all mass transit riders in the country. Federal funding for schools presents a similar problem and another issue Congress could address.

Of course, the fact that Democrats have the majority in both houses does not guarantee any lock-step Democratic policy agenda. Democrats will agree on certain broad policy outlines, but they certainly will not be monolithic in the way that the Republicans have been monolithic. The Democratic camp is simply much larger, both in terms of constituencies as well as the elected representatives.

But despite that, the changes in Washington are really dramatic for New York. The state’s two senators, who were in the minority, now are in the majority, and the same holds true for every one of New York’s Democratic congress people. With Charles Rangel likely to be chairman of the Ways and Means Committee, the New York delegation gets the most powerful committee chair in the House – the one that deals with the House’s power of the purse.

Louise Slaughter from the Rochester area is in line to head the Rules Committee. This may well be the second most powerful committee in Congress because it is where all bills go. The priority given to those bills is determined by the Rules Committee. So, two of the premier committees in the House will be chaired by members of the New York State delegation.

Beyond this, the election gave the state’s delegation more power because the state added Democratic seats on Election Day. Before, the state’s delegation had 20 Democrats and nine Republicans; now there are 23 Democrats and only six Republicans.

On the flip side, there are New Yorkers who will suffer. Representative Vito Fossella, the lone Republican in the city’s congressional delegation, moves from the majority to the minority -- and he’s in an isolated minority. People used to talk about him as the person you had to go to in Congress because he was a member of the majority. Well, he isn’t the guy to go to anymore.

With such a dramatic power shift in Washington, it is too soon to know specifically what will happen. But regardless of how things work out, we have to do better than we have done for the past several years.

Douglas Muzzio is a professor at the Baruch College School of Public Affairs and a political analyst and on-air commentator for WABC-TV.

Mighty Wind of Change, or a Breeze?

By Julia Willebrand

As the Green Party candidate for comptroller, I was not surprised that Alan Hevesi won. But what does a victory mean, when the election system did not allow all the candidates a fair chance to reach the public?

The Democrats won a clear victory nationally as well. But what will it mean to New Yorkers? The proposed Democratic policy initiatives will surely disappoint the more than 60 percent of Americans who oppose the war and the nearly 70 percent who want a national health insurance system. With several years to plan for this day, what is the House and Senate Democratic leadership offering the American people, which gave them control of both houses of Congress?

Nancy Pelosi, soon to be Speaker of the House, smiles charmingly with vague promises of bipartisanship and a change of direction in the war. Harry Reid, likely Senate Majority Leader in January, unforcefully vows an increase in the minimum wage to $7.75. Instead of fighting for national health insurance, he tepidly plans to negotiate with drug companies over Medicare Part D prescription prices. His promises can generate little excitement in New York, where the state minimum wage increases in January to $7.10 and 28 percent of working age adults in NYC have no health insurance.

Is there something to inspire New Yorkers in the power shift within our state? Will winds of change prevail when Eliot Spitzer replaces Governor George Pataki in the triumvirate (with Senate Majority Leader Joseph Bruno and Assembly Speaker Sheldon Silver) that is widely understood to call all the shots? Or will it be a mild sea-breeze?

The governor-elect is perceived by the electorate as a reformer. As a reformer he could respond to calls for change by shifting in a progressive direction.

For instance, statewide there is a near constant cry for tax relief. Unfortunately, elected officials and good-government groups usually treat tax relief as a zero sum game often framed as: The state can provide pensions to state employees; but these benefits will inordinately inflate state and local government budgets; therefore, in order to provide the benefit, we must increase taxes. The choice offered is cut pensions or increase taxes.

But, the frame could be changed and another choice offered. Every low interest loan, handout, tax subsidy, tax rebate, PILOT to a for-profit corporation is a budget expenditure that amounts to a tax increase on the rest of the citizens of the state. Rather than cut retiree pensions, we could cut developer handouts, and end tax rebates to mall owners. We could stop the blackmail of “pay us or we won't build” or “subsidize our stadium or we will move” by refusing these giveaways.

This week the Economic Development Corporation is preparing to give a $37 million tax subsidy for a new office building in the NYC diamond district to the Extell Development Corporation. Replacing Extell's unpaid taxes of $37 million will necessitate higher taxes for everyone else. Further, present diamond-district landlords stand to suffer severe loss of revenue when the new skyscraper offers its one-year free rent inducement. Why should one landlord be favored over many others? Governor-elect Spitzer could take a progressive lead by announcing his disapproval of private corporations that pay their way by dipping into the public pocket.

Changing the Albany culture of developer dependency requires information. Our new governor could establish a state level Independent Budget Office, modeled on the NYC IBO. Once established Spitzer or the Comptroller could require that new IBO to provide New Yorkers with quarterly statements on lost revenues resulting from developer handouts. This kind of information could be a first step to rational budgeting. With full information on giveaways and handouts, citizens would be able to make real choices. The public is being ripped off by its politicians who invite a small number of private concerns to dip into the cookie jar. This could be reversed. With full information on giveaways, citizens and their representatives would be able to make rational choices that would benefit the vast majority.

Governor Spitzer can continue present practice or he can bring big change “from day one” for all New York's citizens. Which will he do? I am hoping that he will change both the culture of Albany and the direction of public policy.

Another area that the new governor can improve greatly is the fairness of our election system. Given the landslide nature of the Mr. Spitzer’s win, the obscurity of the comptroller’s office, and the Democrat enrollment advantage in the state, Mr. Hevesi’s win was to be expected. However, the inevitability of the outcome might have been mitigated by televised debates. My vision, and Mr. Callaghan's, of what the office could and should do are dramatically different from the incumbent's. When I spoke at candidate forums, audiences were shocked to learn how unaccountable the comptroller is. For instance, Mr. Hevesi recently pushed through the legislature a change that allows him to use pension funds to buy anything a “prudent investor” would invest in. This means that there are no longer limitations that prevent the comptroller from investing in, say, a hedge fund such as Amaranth, which just lost $5 billion, or more than 50 percent of its total assets.

All three small-party comptroller candidates benefited from Mr. Hevesi's chauffergate scandal. But I believe that my surprising vote totals were partly due to something else. Every time I told the comptroller's office story, people would come up to me and say, “I'm going to vote for you.” Information is powerful. Getting it out is difficult.

Julia Willebrand received more than 100,000 votes as the Green Party candidate for New York State Comptroller.

Taking on Special Interests

By Nicole Gelinas

Governor Eliot Spitzer could do much for the City of New York by cutting through Albany’s firewall of special interests to tilt the balance of the Empire State’s taxing and spending toward the public interest. To do that, he will have to battle Albany’s self-serving culture.

Special-interest influence in Albany distorts not only the state’s priorities; it distorts the city’s priorities as well. Consider: New York City spends $5 billion annually on pension benefits for city employees and $2 billion annually on Medicaid services for the poor, comprising nearly 20 percent of the city’s taxpayer-funded budget. But the city has little direct control over this spending, as the State Legislature and the governor, not the City Council and the mayor, determine pension and Medicaid benefits.

To address this, Spitzer and Mayor Michael Bloomberg could sit down during the governor’s first term and work on a new pension plan for future employees, particularly for employees who work at desk jobs rather than at vital public-safety jobs. This would enable the city to better manage future pension costs. The two leaders could also work on slicing the bloat out of the state’s Medicaid program, which costs nearly twice as much per patient as the national average without providing twice as many public-health benefits.

But if the new governor introduces even modest reforms, he will run right into Albany’s mass of self-interested parties. Albany is famous for backroom dealings and equally famous for bestowing rewards on the special-interest groups that provide the most money to maintain business as usual.

To wit: the state’s largest health-care workers’ union, Service Employees International Union 1199, is fearful of meaningful Medicaid reforms and the effect such reforms might have on its 250,000 members’ jobs and wages. The union wields great power over the two houses of the legislature, through its financial contributions and get-out-the-vote efforts. The unions that represent the city and state’s public sector employees, which fiercely protect their members’ pension benefits, wield similar power. These influential factions would protest vigorously against any proposed changes to the status-quo.

Spitzer’s renowned stubbornness, along with his reputation for integrity, could prove to be his best weapons in a battle with these forces. The governor-elect has already made a strong start in changing Albany’s tone. Last week, Spitzer set an example for above-board transparency in the executive office by announcing a Web site through which anyone can apply for top-level jobs in his administration. The governor-elect has promised that he will not hand out such jobs based on party affiliation, only on merit. Further, it is a good sign that that powerful local 1199 chief Dennis Rivera declined to endorse a candidate in the governor’s race. Because of that, Spitzer now owes him no favors.

If Spitzer can reform Albany, the rewards will be great for Gotham, for Gotham needs to realign its investments in its future. The city and state have both neglected the city’s essential public infrastructure, like subways and roads, as social-services and pension spending has consumed more of their budgets.

If the new governor can re-balance Albany away from the special interests and toward the public interest, more taxpayer dollars, both city and state, could support growth in the city’s private-sector economy rather than feed its public-sector economy.

Nicole Gelinas is a senior fellow at the Manhattan Institute.


Gay Rights Moves Forward

By Christopher Murray

Members of the lesbian, gay, bisexual and transgender (LGBT) community in New York City seem uniformly optimistic after the rout of the Republican majority in Congress.

Many of New York City's leaders who are good friends of the gay community are likely to be moving into positions of significantly heightened influence. "Just having Congressman Charles Rangel, who is such an advocate for the gay community and on HIV/AIDS issues, as chair of Ways and Means is going to have an unbelievable impact locally," says Brooklyn's gay Democratic district leader Alan Fleishman. According to Fleishman, Congressman Anthony Weiner is very close to the Speaker-Elect Nancy Pelosi as well as to Congressman John Murtha who may well be the next Majority Leader. "Urban centers like New York tend to be where lesbian and gay power is concentrated," Fleishman said. "Now all our strong allies will be in the majority, like Congressmembers Nydia Velazquez, Joseph Crowley and Jose Serrano."

Gary Parker, founder of Greater Voices, the coalition of all the progressive gay political clubs in the city, points out that local LGBT organizations stand to benefit markedly from increased federal funding. "Places like the Gay & Lesbian Anti-Violence Project, or the LGBT Center, or the Ali Forney Center that helps homeless queer youth, now all may be able to better serve those who so need their help with more dollars in the pipe line from Washington."

The LGBT community expects an Eliot Spitzer-led administration in Albany to move the gay marriage issue forward. Spitzer, Lieutenant Governor-elect David Patterson, Attorney General-elect Andrew Cuomo and re-elected, if tarnished, Comptroller Alan Hevesi all campiagned as in support of gay marriage. While Senators Hillary Rodham Clinton and Charles Schumer remain opposed, gay leaders like Alan Van Capelle of the Empire State Pride Agenda, will be organizing New York City-based grass roots efforts and donors for a full-frontal assault on the state legislature on the issue come January. In an email following the election, Van Capelle said, "Some believed it would be difficult to run for statewide office and support us on our issues, especially marriage equality. Today we know that not only can you stand with our community and win statewide office, but you can also win in a very BIG way."

Still, some local groups remain wary of hitching the entire gay parade to the marriage issue. Queers for Economic Justice spearheaded a trenchant critique of gay marriage and Miriam Yeung, the Director of Public Policy at the Lesbian, Gay, Bisexual & Transgender Community Center, cautions against gay marriage becoming the sole issue for this demographic slice of the electorate. "While we're excited about the prospect of having a governor who supports our issues," she said, "I'm hoping that same sex marriage doesn't become what the death penalty was in the eighties: the one thing that electeds could vaguely say they support and not have to do anything on."

Christopher Murray, a social worker, is co-president of Lambda Independent Democrats, Brooklyn's lesbian, gay, bisexual and transgender political club.

Helping Small Businesses

By Jonathan Bowles

Democratic control of Congress and the elevation of New York City Congresswoman Nydia Velazquez to the head of the House's Small Business Committee has the potential to change Washington's dialogue about small business.

Small businesses are creating the majority of new jobs in New York and nationwide. Yet in the past several years, President Bush repeatedly tried to cut or eliminate critical financing and technical assistance programs for small businesses, from the Small Business Administration’s micro-loan program to the Treasury Department’s CDFI Fund. Meanwhile, some Republican members of Congress were even considering doing away with the Small Business Administration, an agency that has had its problems but has been wildly successful in helping address one of the biggest problems facing small firms: accessing capital. Congressional supporters recently have had to focus most of their energies on staving off these shortsighted proposals. Instead, legislators should look to expand federal support for programs that help entrepreneurs start and grow businesses.

Perhaps most important for New York are the programs that help small-scale entrepreneurs access micro-loans ranging from a few hundred dollars to $50,000 and receive assistance on everything from writing a business plan to complying with local regulations. Like so many other cities, New York is home to hordes of entrepreneurs who depend on these programs. Many are minorities and immigrants who either have no credit history or don’t meet standard criteria to access traditional bank loans. There are a number of well-respected community-based organizations in the five boroughs that provide micro-loans and technical assistance to these micro-businesses, but many of the groups have experienced funding cuts in recent years.

In New York City, 158 businesses received loans through the micro-loan program in 2005. Yet, federal support for this program dropped from $19 million in fiscal year 2000 to under $13 million in fiscal year 2006. Earlier this year, President Bush tried to eliminate the program entirely. The CDFI Fund and the PRIME program have also sustained cuts, while support for the SBA-funded Small Business Development Centers in New York has not expanded to meet the increased need.

When it comes to these crucial small business programs, we've been playing defense. Hopefully with Democratic control of Congress and Representative Velazquez as the head of the House's small business committee we bolster support for this growing part of our economy.

Jonathan Bowles is the director of the Center for an Urban Future.

New Energy to Combat Predatory Lending?


By Mark Winston Griffith

At first blush, with the explosion of high cost financial products and predatory lending over the last ten years, it’s difficult for New Yorkers -– or anyone else in the country for that matter –- to be optimistic about the government’s willingness to reign in the banking and financial services industry. Even when you consider that New York State’s financial justice advocacy environment is more progressive than most, everything from credit cards to mortgage lending is largely –- but not exclusively -- regulated at the federal level.

Nonetheless, all eyes will be trained on Governor-elect Eliot Spitzer, who as attorney general proved to show less tolerance for predatory and exploitative financial practices than New Yorkers have seen in some time. Spitzer gained respect in advocacy corners for suing H & R block for steering customers to junk IRAs. He also recently said publicly that as governor he would curtail abusive debt collection and look into the practice of companies selling off their debt, even going as far as saying “There is a key link between sold-off debt and illegal and abusive practices.”

Spitzer’s choice for Superintendent of the State Banking department will, some hope, be less conciliatory to state-chartered banks. The current superintendent, Diana Taylor, has been perceived by some as too anxious to allow banks to indulge in questionable practices, like bounce protection, a high-cost, low quality alternative to a line of credit.

In fact, conditions may be ripe for a new era of consumer protection in the financial services industry, with New York helping to lead the way nationally. For instance, a law was recently passed in New York State that clamps down on an increasingly widespread form of real estate fraud called deed theft. Also, even as tax preparers like H&R block, Jackson Hewitt and Liberty Tax Services expand a particularly high cost form of lending called refund anticipation loans that is marketed heavily to low-income customers, there is mounting pressure to force companies to discontinue this product. There seems to be a growing chorus of advocates, elected officials and pissed-off consumers who are searching for ways to re-regulate the financial services industry. There are even two new documentaries that are highly critical of the banking and financial services industry ready to hit the screen, In Debt We Trust and Maxed Out.

Now, with a new sheriff in town, there just might finally be enough guns to run at least some of the bad guys out of town.

Mark Winston Griffith is co-director of the Neighborhood Economic Development Advocacy Project and a fellow at the Drum Major Institute.

Fewer Children Left Behind?

By Norm Fruchter

Democratic control of both the House and the Senate should result in changes in the No Child Left Behind program that will benefit New York City's schools and students.

Democratic control will likely result in changes to the rigid means of assessing schools, so that there will be more weight given to year-to-year student progress, rather than whether or not students meet specific standards.

Current rules harshly penalize students with disabilities and students whose first language is not English (and especially immigrant students), and the many New York City schools that serve them. Democrats will likely introduce changes that reduce the punitive effects of current policies affecting students with disabilities and English Language Learners.

The successful Democratic capture of what were once considered safe Republican House seats in upstate New York may create more flexibility in the New York Senate regarding a negotiated settlement of the Campaign for Fiscal Equity lawsuit to bring critically needed new funds to New York City schools.Ă‚ Republican control of the state Senate is approaching a razor-thin margin. This election's demonstration of upstate Republican vulnerability may prod the state Senate leadership to bi-partisan cooperation with a Democratic governor and Assembly.

Norm Fruchter is director of the Community Involvement Program of the Annenberg Institute for School Reform

Hope For Education and The Arts

By John Brademas

That Democrats will hold majorities in the U.S. Senate and House of Representatives after the November 7 elections is good news on a number of fronts but particularly encouraging for New Yorkers on measures to strengthen education and the arts. Institutions of learning and culture are so important to the people of New York City.

During my 22 years in Congress, during the administrations of six presidents, the bills to support early childhood programs, elementary and second education, college student aid, the arts and the humanities, libraries and museums won votes from both Democrats and Republicans. But during the administration of George W. Bush, with Republican majorities in Congress, these all have seen a decline in support.

I hope the election results will mean a return to bipartisan support in Washington, D.C. for education and the arts, including adequate funding for No Child Left Behind and for special education.

Another consequence of this month's elections is a renewed focus on Congress and its role in our separation-of-powers constitutional system.

John Brademas, a Democratic member of Congress from 1959 to 1981, is president emeritus of New York University, and connected to the John Brademas Center for the Study of Congress at NYU's Robert F. Wagner Graduate School of Public Service.




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