Audio Transcript

Brian Anderson: Welcome back to the 10 Blocks podcast, this is Brian Anderson, the editor of City Journal. I wanted to remind our New York City listeners about signing up for our e-newsletter, “The Beat.” You’ll get insight on housing, education, homelessness, infrastructure, and more delivered right to your inbox three times a week. You can find it and subscribe to it at www.thebeatmi.com.

That’s it for me. The conversation between Nicole and Seth begins after this.

Seth Barron: Hi everyone, welcome back to 10 blocks, the official podcast of city journal. This is your host for today Seth Baron, associate editor of city journal. Mayor de Blasio gave his State of the city speech last week and he had some pretty strong words about wealth and the direction of the city and just this week he indicated that he's open to the possibility of running for president in 2020. Joining us today is Nicole Gelinas, senior fellow at the Manhattan Institute and Contributing Editor to City Journal. Nicole writes frequently about public policy for a range of outlets. Her latest piece for City Journal is called "Empty Words" and counsels us to keep an eye on de Blasio's actions, less so on his rhetoric. Thanks for joining us, Nicole.

Nicole Gelinas: Thank you Seth, it's good to be back.

Seth Barron: So what about what de Blasio said in his State of the City speech? Uh, I mean he made some very radical claims about things he's doing in the city, but you caution us not to take it all entirely at face value. What do you mean?

Nicole Gelinas: Well, de Blasio is playing a very interesting game. He ran for office talking about the tale of two cities in New York, the rich versus the poor city, but now he's really looking for a tale of two audiences that after five years of being a mayor in New York, he's really tired of the New York City Press Corps. The press corps has done a pretty good job of going after his public corruption problems with top donors and so forth and favors and some of his failures of governance, whether it's public housing or failing to deal with some of the problems of the mentally ill, homeless on the streets, things like that. And so he knows that he's not going to get to the presidency through the New York City Press Corps. And so he's looking for a national audience. And we saw last week he went on Morning Joe. He pushed an article in the Washington Post and then again he was on Jake Tapper on ABC over the weekend. So he's looking for more credulous national reporters who don't know very much about New York City. About the background here about his governance policies here. And he's really trying to push himself as a more left wing Alexandria Ocasio-Cortez style politician and saying things like, "the city has enough money. It's just that the money is in the wrong hands," you know that's a very startling thing to say if you haven't been here and you don't see that he doesn't seem too worried about giving a billion and a half dollars away in tax breaks to Amazon.

Seth Barron: Right. Well, I mean, you, you know a lot about the fiscal realities of New York City. In five or six years, de Blasio has never really had to budget in the sense of having to cut anything. Um, to what extent do the millionaires and billionaires, as he always says, um, fund his expansive, you know, governmental agenda.

Nicole Gelinas: Yes. The answer is a lot. If you look at the city's income tax, for example, 1 percent of taxpayers, which is about 40,000 families pay 43 percent of the city's income tax. And so the city is already heavily dependent on the wealthy. If you're in favor of redistributing income, essentially taking income from the rich and giving it to the poor and middle class, New York is the place for you. We've been redistributing income for 60 years. Mayors just differ on how much they, to what extent they do it, what their rhetoric is and what they spend the money on. But de Blasio has been no different than his predecessors in terms of being a redistributive mayor and interestingly, although he ran on raising the income tax rate, he wanted a millionaire's tax during his first election. He pushed for it in his inaugural speech. He pushed for it his first budget. He was never successful at getting the governor and the legislature to enact a higher income tax in New York, which is a good thing. But this year now that he has a, he has a steep, a democratic state senate. So here's the first realistic chance that he actually has to get that tax increase passed. He seems to have backed away from it. In his State of the City, he sort of said, well, I think a millionaire's tax is a good idea, but a lot of people have a lot of other ideas. I mean, this is hardly a resounding call for a millionaire's tax. Again, that's a good thing that he seems to be pushing away from this tax as soon as he might have a chance of actually doing it and it shows that on a lot of issues, he, in governing, he tends to be more pragmatic than he tends to be a radical left wing AOC style politician. Again, that's not a bad thing for New York City residents. You know, we have seen incremental change, but on the national stage he's definitely trying to push himself to be something that is really not now.

Seth Barron: Well, you indicated in your piece, I think that um, the Washington Post, I guess referred to his tax increases and he likes to, it's, you were indicating he seems to like the idea of being presented nationally as someone who's raised taxes, although constitutionally, he's not really capable of raising taxes, is he?

Nicole Gelinas: No. He could raise the property tax and there's actually a lot of talk about property tax reform and how people who are, its property tax system is immensely complicated. But that's the only tax that the mayor of New York City controls where he doesn't need the state legislature and the governor to approve a tax hike. And a lot of people want people like de Blasio who own houses that have gone up in value over the past 30 years to pay higher property taxes and use that money to give other people a break. You know, renters are indirectly paying a higher property tax than single to three family homeowners. So property tax reform would actually not be such a bad thing for the city in one could make the case that you could tax wealthy property owners a little bit more and use that money to help out people who don't own property. But the mayor has never gone after that issue because he doesn't, you know, he, I think he realizes that New York at heart is a pretty conservative city in a lot of ways. Park Slope where he's from is pretty conservative on a lot of these issues and he's, he's been smart enough to get himself elected twice partly because what he says is sometimes quite different from what he does.

Seth Barron: It's funny, I think a couple of years ago he indicated that, um, people in New York don't really appreciate him because the press is so harsh and so negative, but that when he leaves New York City, he's met with all of this approval from people who really understand what it is he's trying to do. Now, I mean, I think he might be overstating the warm welcome he's received outside of the city, but it is an odd, uh, I mean you were talking about his, the two audiences he's looking for. He, he seems to definitely be conscious of this. This split in terms of how he presents himself.

Nicole Gelinas: Yes. Even things like desegregation of public elementary and middle schools, you would think this would be an easy progressive issue, but he has been fairly slow and incremental about these, about these issues.

Seth Barron: Um, let's talk about some of the specific things that he's brought up last week. One item that he got a lot of national attention for. He said he was going to provide free health care to everyone in New York City, including illegal immigrants. Um, now he, he got, you know, people all over the country were talking, you know, Drudge Report had it as a, uh, a major story, a major headline, this is like this amazing thing he's doing. But uh, I mean, for those of us who know a little bit about how the city's public hospitals work, we, we knew it wasn't, he wasn't really actually making any radical changes. Do you, do you agree with that?

Nicole Gelinas: Right. Well, you, you wrote about this last week for our website and you know, I'll just say back to you what you wrote that,

Seth Barron: oh, okay

Nicole Gelinas: We have, we have universal healthcare. If you want to loosely define it and that of course anybody with an emergency can go to an emergency room, go to a public hospital, get care at the at the point of emergency service, and this is already an $8,000,000,000 infrastructure plus all of the billions of dollars that we spend on local and state Medicaid. A lot of that money finds its way into the system as well and so de Blasio is trying to do something that other mayors have done before. Which is direct people away from the emergency system into clinics, into places where you can go for a checkup once a year and so forth. You know, he wants people to get preventative checkups and none of that is is bad and one could say it's fiscally pragmatic and that in some cases he want people, he wants people who are getting care for free to start to pay a little bit on a sliding scale if they can pay something, but it's not, it's not universal healthcare, by anyone's definition of the the word. I mean if you, if you have private sector healthcare, government funded healthcare, if you're a city worker and the city pays for your healthcare, you know, none of those things will change. This is just for a few hundred thousand people who aren't interacting at all with the healthcare system, unless it's an emergency. He wants them to start thinking about coming in once a year or so forth. But if they need a major heart surgery or procedures that run into tens of thousands or hundreds of thousands of dollars of healthcare apiece, they're still going to end up on the Medicaid system, which is, you know, what obviously has challenges on its own that he hasn't really sought to address.

Seth Barron: Right. Or, you know, I mean there are between 300 to 800,000 illegal immigrants who can't get Medicaid. Um, and you know, I heard the Head of Health and Hospitals Corporation say a few years ago that, that comprises a 2.5 billion dollar annual expense for, um, Health and Hospitals Corporation, which I did. The accounting seems a little vague, but I mean to me it seems as though that's money that the city is essentially paying.

Nicole Gelinas: Yeah. And you know, it's the age old problem of public health versus private benefit. I mean, you don't, you don't want people walking around with tuberculosis or measles or other communicable diseases, but on the other hand, it is very expensive to offer a true universal healthcare system and have essentially open borders in a sanctuary city. I mean, you can't, uh, you know, and countries that offer universal healthcare, deal with these issues. So you know, if, if you, if you go to a European country, if you go to Israel, unless you are a citizen of these countries, you will end up paying for your, for your care.

Seth Barron: Right. Now de Blasio nevertheless, whatever he said, I mean, just the fact that he said that this, he was going to put $100,000,000 towards care, towards all of this care. But simple arithmetic shows that, well, that comes out to maybe say $200 per person. There's no way that $200 annually, that a $200 expenditure is going to cover healthcare for anybody. So it's clear that this extra money is, as the Head of Health and Hospitals Corporation, Mitchell Katz, said, uh, we're essentially just providing better customer service. To me it seemed like he, he was kind of giving away the show there, that this isn't really providing deep healthcare. It's, it's, you know, it's probably going to buy more navigators, more people to help you know, translate information and so forth. But another thing de Blasio promised last week was to, um, make sure to make it the law that any company working in New York City with more than five employees would have to provide two weeks paid vacation to their employees, which sounds like a pretty major change. But you wrote a piece saying, well, hold on a second, this isn't such a big deal either.

Nicole Gelinas: Yeah. This fits into the general de Blasio theme when, if you look at what he's spent city money for, it's tended to be, tended to be a lot of smaller scale programs. When you think of previous candidates like Freddy Ferrer that had these multi-billion dollar government funded expansions of of government, de Blasio's, actual expansions of government mostly have been focused on just higher costs for the public sector employees. If you think of, if you think of the city budget going up almost 40 percent over the past five, six years, most of that has gone toward the raises for the public sector employees and if you look at programs like pre-k, even though as you said, the healthcare expansion only $110,000,000. These are not in and of themselves very expensive. He's not, he's not a big spending liberal in the sort of cartoon version of just throwing billions of dollars of new money at government. Even with NYCHA, he's actually been pretty conservative about not trying to fix the problem with just a blank check. And so if you get back to his vacation program, this is vintage de Blasio. He's trying to get credit for something where he's not going to have to spend any city money, and if you look at the burden that he's putting on private sector employers, most of them are not gonna have a new burden. That doesn't mean it's a good thing because if you were by the mayor's own numbers, 89 percent of people in the city workforce, you know, uh, almost 4 million out of four and a half million people who work in New York City. They already get two weeks paid vacation. You know, this is, this is a standard benefit whether you work at the Gap, we don't have Walmart, but if you work at Walmart. At pretty much any place that employs full time payroll workers, if you've worked there a year, you get your two-weeks vacation and interestingly enough, if you don't take your vacation, the mayor won't, the new law that he wants the council to enact, you won't get that money. You can't. It's not like if you work for the city and you don't take your vacation, you can be paid for that time.

Seth Barron: Right, use it or lose it.

Nicole Gelinas: Yeah, so this doesn't solve the problem that most people have, which is that they have vacation, but they don't take it. That would actually be a burden on a lot of these private sector employee, uh, employers that nominally offer vacation, but they really don't want their people to take vacation. And if you look at the other 11 percent of the workforce where people don't get two-weeks vacation, this is small struggling retailers, restaurants that are constantly going in and out of business. Uh, you know, places where basically if you have a lot of different options, you really, you don't want this to be your full time career and they don't offer vacation because they're poorly managed and/or they can't afford it. So to the extent that people do need these jobs, and this is just another mandate that could send some of them over the edge. You know, you're hurting the people that you want to be helping and everyone else that you, you say you're helping, they already have this benefit anyway.

Seth Barron: So, it's similar to the paid sick leave.

Nicole Gelinas: Yeah, I mean if you're, you know, a reputable employer does not want its employees coming in sick and this is something that it's like, it kind of regulates itself. I mean the, the people, the employers who need this mandate to keep people from showing up sick, you know, these are, these are not places that you really want to work for if you have a lot of other options.

Seth Barron: So, um, let's, let's talk about de Blasio's latest, um, bombshell, I guess, indicating that, well, he's open to the idea of running for president. A lot of people have suspected that this is something he wanted to do. Obviously he has his eye on a, you know, a national platform. But, you know, now he said that he, you know before he said he was definitely not interested and he was going to fill out his term, but, you know, now he says, well, things have changed and the world has changed. Um, what do you think about this? Does de Blasio have the um, have the chops to make it on the national stage?

Nicole Gelinas: I guess the national voters will decide that, but I would say one of his biggest problems is just making a place like New York City seem relevant to voters in Iowa or New Hampshire or even, you know, bigger, more diverse states. We have a city where the concentrated wealth, to most of the country, even even wealthier parts of the country is just unimaginable. I mean you, you mentioned when we started out that de Blasio has never had to make budget choices. You know, he could give all the city workers a generous raise, two rounds of generous raises now, expand government programs to the extent that he has.

Seth Barron: The ferry.

Nicole Gelinas: Yeah, add police officers. Many of these are virtuous meritorious things, but this isn't the, this isn't a situation that most people live within their day to day, state and local governments. I mean we basically just pay for everything that we want and he's, he's the only mayor in modern history to get through this long in office and not have to deal with a recession. And so things like the relevant issue of have I ever really had to balance a budget and balance one interest off another or uh, uh, deal with cutbacks and tax revenues or things like that.

Seth Barron: Or deal with another party, another political party.

Nicole Gelinas: Yeah, that's true too.

Seth Barron: We essentially have a one-party state here. But I will remind you, lest you forgot that the most recent victor in the presidential election was a New Yorker.

Nicole Gelinas: Yeah. But he never ran an element of New York City government. I mean he's kinda like using New York literally as a soundstage, which is, but what do you think you think de Blasio versus Cuomo versus Bloomberg, any of these, uh, gentlemen, are we going to see an all New York primary or they, uh, does any of them have a good chance?

Seth Barron: To me, I just think about, um, when during the 2016 or maybe it was in 2015 when Hillary Clinton was campaigning out in Iowa and um de Blasio and his wife went out there uninvited by her campaign and um sort of there was photos of them walking around in jeans just kind of by themselves. No one knew who they were. No one particularly cared, I think de Blasio has worked very hard to establish himself, you know, or again, when he wanted to have a national symposium on wealth inequality, uh, with all the candidates before the 2016 election. He wanted both Republicans and Democrats to stand and have him a moderate a panel on wealth inequality and no one would agree to join him, no one, a lot of people didn't call him back. And as we saw with the email releases that came out recently, uh, he was in a tizzy about this and a real lather, why won't Kamala Harris call him? Why won't, why won't they agree? You know, we need to get CNN on this and, you know, it's kind of been a dud. And then of course, you know, my favorite part was during the Democratic National Convention when he was put on in the mid-afternoon, right after the, the tally of, um, recently deceased politicians. It was like the most morbid spot. Uh, you know, it, it seems like it's been a real comedy of errors, his efforts to establish a national profile.

Nicole Gelinas: It's interesting that he just seemed so uninterested in New York City. I mean, that's not something like, you know, Bloomberg had his flaws, Giuliani had his flaws, but they always seem very interested in the city. Like if you were to think about what is the most potent criticism of de Blasio? He's kept crime down despite all the rhetoric about the tax increases and so forth. He apparently hasn't scared away businesses from wanting to locate here, you know, those are good things. Although both of them are somewhat outside of his, uh, his direct control. I mean these things depend on other factors as well, but he's coasting on what other people did. You know it's very good that he's, he's kept crime going down that we have the lowest murder rates since 1951, that could've gone the other way and I'm sure if it had, he'd be getting tremendous criticism for that. So, you know, fairs fair. That's good that he's done that. But he didn't come in with a vision that New York could be a low crime city. Other people did that before him. Just like he didn't come in with the vision that we could have a tech hub here. You know, as Steve Lingo wrote in the magazine, other people had that vision and he's kind of like reaping the rewards. And so if you think about what is de Blasio's vision, what kind of mark does he want to leave on the city? I don't know. I mean, what would you say? The pre-k, that's a fine program and it's, it's, it's good that people have more childcare options for kids younger than kindergarten, but it's hard to see that as an overall vision for where do you want the city to be in 10 years, you know, when the next mayor comes in, what will that person coast on that de Blasio started? Like there's no real big infrastructure project. You know, he had this Brooklyn Queens street car idea, but it just, whether you agree with it or not, he never took it anywhere. It's just sort of died on the vine.

Seth Barron: Um yeah, I suppose, you know, he would say, well, you know, making things more fair for people. Uh, but uh, I'm not quite so sure that, you know what, I don't know what the Gini Coefficient from New York City is, but I'm not sure that things are necessarily less unequal than they were when he came in or that he would have had much to do with that. Uh, the schools seem to have the same, you know, in terms of outcomes, the same racial disparities probably exist. Uh, the same, you know, crime is still concentrated in the same communities that it was before. Um, you know, look, I agree with you. It's great that murders are down.

Nicole Gelinas: And things like the city's intractable problems. Yes, they predate him. You know no one has ever done a very good job with public housing and it's been falling apart for 30 years. The, the severe mental illness problem and people who just can't take care of themselves out, lying on the street, compounded by the opioid epidemic. He doesn't, he didn't create those problems, but at the same time has he used this boom that the city is having and use all of this work that other people did before him on other issues? I mean, has he really used that breathing room to attack those issues in the most aggressive way that he could? Uh, you know, maybe people would disagree. He's done some good things on NYCHA. It's good that he got this agreement with the custodians that they changed their work rules and so they'll have to work more productively. It's good that he's launching this program to lease off some of the, the land that NYCHA owns to try to pay for the rest of public housing. Although when Bloomberg had that idea, de Blasio kind of ran against it. So, you know, he sees doing some things that are certainly better than not doing them. But are these going to be visionary changes?

Seth Barron: Well, uh, as you sort of indicated before, he's been very lucky that the stock market has continued to pump money into the city and Wall Street bonuses are up. So what does he have to worry about really, long as he has that?

Nicole Gelinas: Right, and yeah, that just reminds me where's all our infrastructure too, that we should be paying for with this, this boom era money. Like if you think about us being in the 100th month of an economic expansion, what happens when eventually that ends? Are we doing everything we can in our power to leave the city in, in a good state for whoever might have to come in during a recession after a recession? Are we, are we doing enough to make sure we're building a good economic base for jobs that future mayors can take credit for? I would say no. I mean the subways are a mess. The streets are still a mess. You know, he could manage these things. Well with the subways, he could be more assertive like Corey Johnson the speaker is doing and saying he wants some control over the subways and with the streets, he's done some very marginal improvements, but nothing like the vision that Bloomberg had for remaking the streets.

Seth Barron: It's amazing to hear a de Blasio go on and on about how he doesn't control the subways and you know, at all of his town halls, he says, okay, who controls the subways? Tell me. The governor. Uh, I mean, typically you wouldn't think a big city mayor is so happy to proclaim that a major element of the city's infrastructure is just not his job. Oh, it's not my responsibility. I mean, even if it's not, you would think that, I mean, I can't imagine Bloomberg or Giuliani excusing themselves quite so readily.

Nicole Gelinas: Right. All your Bloomberg obviously took over the school system even, even though it wasn't his job at the time. And when Bloomberg was pushing for congestion pricing, he did try to enact some basic MTA reforms and he, he failed at it and Albany was a mess. You know, Sheldon Silver is obviously going to prison now. He was in charge of the assembly. Bloomberg wasn't as successful as he wanted to be with some of these big infrastructure issues, but at least he did pay some attention to them.

Seth Barron: Yeah. Well, don't forget to check out Nicole's work at city-journal.org, and you can follow her at @NicoleGelinas on Twitter. We would love to hear your comments about today's episode on Twitter @CityJournal, #10blocks. If you like our show and want to hear more of it, please leave ratings and reviews on iTunes. This is your host for today's Seth Baron. Nicole, thanks so much for joining us. Thank you, Seth.