The Days After

The champagne has been popped, the balloons dropped and confetti sprayed from overhead. The elections are now over. We have a new President, a new Congress and a new State Legislature. Campaigns are fun; campaigns are exciting; and campaigns are inspiring, but now the real work begins, governing.
Faced with arguably the worst fiscal crisis since the Great Depression, the sobering reality of the task at hand is what the City of New York is left to contend with in the days and weeks ahead. Decisions will not be easy, nor will they be met with overwhelming acceptance. The consensus-building that it will take to achieve real economic recovery cannot be accomplished without compromise and an allegiance to do what is best for the common good. But before we identify a solution, we must establish the problem.
It has been estimated that in the fiscal year 2010, beginning July 1, 2009, the city’s budget deficit will reach a staggering $3.3 billion. Worse yet are the nearly two hundred thousand jobs which could potentially be lost in the year to come. With Wall Street collapsing and tax revenue expected to plummet, it will take an innovative and proactive approach to guard the city from financial ruin.
Mayor Michael Bloomberg, fresh from his recent round of political sparring over the issue of term limits, has put politics aside and the people first in offering a solid first step toward combating the deteriorating economy. It will take more of this kind of leadership to fully reverse the trends of a quickly fading economy, but Bloomberg’s quick and affirmative action to tackle our growing financial problems is a welcome sign of the type of post-election governing that is sorely needed.
Last month, Bloomberg called for across-the-board cuts to all city agencies to trim the deficit and is expected to announce the specifics of his plan this week. He ordered a cut of 2.5 percent this year and another 5 percent next year, which is estimated to save the city over $1.5 billion. Making cuts so soon after the political fallout from the term limits controversy may seem risky, but it also shows the brand of leadership we have come to expect from Bloomberg. He is willing to do what is unpopular if he thinks it is right and though cuts are a painful pill to swallow, it is the lack of an aggressive plan that would prove indigestible for our finances.
Bloomberg has also indicated that he will call for a repeal of the seven percent property tax cut he and the City Council passed during the past two budgets. Again, not a popular maneuver, but with fewer tax dollars expected, the move is another necessary evil the Mayor is willing to make if it means bringing the city closer to financial solvency. Saving potentially an additional billion dollars could keep more teachers in their classrooms, cops on the street and the doors of vital social service agencies opened to the public.
The plan is to cut spending through multiple avenues to avoid municipal layoffs. Widespread layoffs result in less tax revenue for the city coffers and more money paid out in overtime to cover the gaping holes left by a reduced workforce. Slashing excesses in our spending may be the only measure that protects jobs during a prolonged financial crisis. Fewer jobs also mean fewer dollars being spent by consumers which would further exacerbate the faltering economy. Protecting jobs must remain of paramount importance in any plan for recovery because during tough times, people can always get by with less but they can’t get by without any.
While the city may be forced to rescind the property tax cut, they should exhaust all possible scenarios to work with state officials to initiate a restructuring of the tax code so the burden does not fall solely on the shoulders of middle-income families. There remains far too wide a gap between the top tier and lower tier of the tax code and it is the majority of families who fall somewhere in the middle that will be hit the hardest if property taxes rise and income taxes remain as they are currently constituted.
Bloomberg has staked his reputation on having the business acumen to lead our city into a period of financial recovery, possibly even prosperity. Third terms have historically proven troublesome for even the most popular of incumbent mayors because of the tough choices they have had to make during difficult times. If Bloomberg is granted one, the question may not be whether we regret the decision, but whether he does.