New York City is in crisis. Nearly a third of the city is unemployed, according to a New School analysis, businesses are shuttering, residents are fleeing.
Things won’t magically “go back to normal,” at least not without help. Government cannot casually wait for a COVID-19 vaccine while the quality of life plummets. Mayor de Blasio and the City Council must act now, to revitalize Gotham and lay the groundwork for a full recovery.
The Post asked experts what politicians can — must — do to save the city.
REDUCE THE SIZE OF CITY GOVERNMENT
E.J. McMahon, senior fellow, Empire Center for Public Policy
With massive budget deficits looming, Mayor de Blasio’s post-pandemic plan boils down to hoping for a stopgap federal bailout and asking Albany for permission to issue billions in deficit bonds.
This won’t solve the problem. New York needed a much leaner, more efficient public sector even before the novel coronavirus blew a hole in its tax base.
De Blasio has added more than 33,000 employees to the city payroll since 2013, the Citizens Budget Commission notes. Cutting even half those positions — bringing city employment back to its 2008 peak under Michael Bloomberg — would save well over $1 billion a year in salary and benefits. Seeking better deals on health insurance and requiring city workers to contribute at least minimally to health insurance and Medicare premiums (like virtually everyone paying their salaries) could save roughly $800 million a year, the Independent Budget Office has estimated.
But municipal unions don’t have a track record of simply volunteering givebacks, even to save jobs. History suggests they will fight tooth and nail to protect everything they have, even in a fiscal crisis.
To win real concessions, the mayor needs leverage — and he can get it from the state Financial Control Board (FCB), created in the mid-1970s to deal with the city fiscal crisis and still in existence as a background watchdog.
The city should adopt a more (justifiably) pessimistic revenue forecast and declare to the FCB that its budget gaps can’t be fully closed without deficit bond financing. The board then will have grounds for asking the Legislature to reinstate a control period and authorize an across-the-board wage freeze.
As the late former Mayor Ed Koch recognized, the FCB can be a mayor’s best friend, by ordering bigger budget cuts than politicians have the nerve to suggest in public.
That might — just might — lead to serious labor bargaining over more palatable alternatives.
This scenario would require a strong partnership between the mayor and the FCB’s chairman, Gov. Cuomo — who until recently showed little interest in the control board. Recently, however, he appointed three close and trusted advisers to the panel. The mayor shouldn’t see this as threat but an opportunity.
© 2020 New York Post
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