The Gamer

Painting by Nick Lepard

Governor Andrew Cuomo is performing what he calls his Toto act. He’s played the part all over New York State, relentlessly, since January, traveling from Amherst to Binghamton to Watertown. Today he is on Long Island, in Patchogue, at St. Joseph’s College. The audience on a winter Wednesday morning is roughly 200 professors, students, and local retirees. Cuomo opens with a joke about arriving late this morning and being confronted by a nun—­triggering pangs of nostalgic guilt from his own years in parochial school. Then it’s on to his beloved slideshow of budget horrors: a $10 billion state deficit! Medicaid spending scheduled to increase by an unsustainable 13 percent! Public-school bureaucrats making $300,000 salaries—even more than New York pays its governor!

But it’s all a setup for the moment when Cuomo-Toto pulls back the curtain on what he portrays as an Oz-ian fraud. Scary as the state’s budget numbers may be, he says, what’s worse is that they’re all a sham. An illusion foisted on the unsuspecting citizenry by craven special interests and their corrupt enablers, career Albany politicians. The two groups have conspired to enact into law automatic “escalators” that propel state spending ever upward, regardless of prevailing economic conditions, failures to deliver services, or common sense. “Even the way the Albany budget is described is deceiving,” Cuomo says, his voice rising. “When they talk about cutting the budget, a cut is defined as anything less than the anticipated growth. So anything less than the 13 percent increase is called a cut! All these years when you’ve been hearing they cut the state budget, you thought cut meant cut. Silly you! Why would you think cut means cut? Cut meant they didn’t have as large an increase as they thought they were going to have!”

At this there are audible gasps from the crowd. The budget story Cuomo tells—about how the insiders have been fooling the public, and how he’s going to put a stop to it—is skillfully crafted, entertainingly performed, and irresistibly compelling. Best of all, it’s true. Mostly.

It’s not a secret that the states are a mess. All over the country, the collision of decades of expansive social programs, federal tax cuts for the richest, and the aftermath of the global financial slide has produced oceans of budgetary red ink. Governors, unlike Congress and the president, are legally required to balance their ledgers each year. The drama is playing out in a variety of ways across the national stage. In Wisconsin, Republican Scott Walker has tried to smash the public-sector unions; protesters flooded Madison while the state’s Democratic senators fled to Illinois. In New Jersey, Chris Christie has used ridicule and threats against the same targets, making him a conservative darling and a YouTube star. Out in California, Democrat Jerry Brown has tried a more cerebral, compromising approach, to little effect.

On Sunday, Andrew Cuomo staked his claim to a new Democratic path, between confrontation and capitulation, left and right: progressive austerity, achieved through equal parts brute force and seduction, bringing business, labor, and politicians together to work it out semi-peacefully. The budget deal announced yesterday is an enormous political victory for New York’s governor, the product of a brilliantly played first 100 days in office. “Like Nixon and Johnson, Andrew is always gaming everything. And he’s very good at it,” says a New York party leader. “He has figured out how to turn his electoral victory, which he’s claiming is a mandate, and his popularity to keep people off balance in Albany.” The result is a new budget that reduces year-to-year state expenditures for the first time in more than a decade, and does so almost entirely on Cuomo’s terms. He worked the angles right up until stepping to the press-conference microphone, gaining Assembly Speaker Sheldon Silver’s agreement by withdrawing a proposal to cap medical-malpractice awards—then claiming that the proposal was a head fake all along to gain passage of deep cuts to Medicaid spending.

But even though crucial horsetrading was done in the final hours, Cuomo had spent months—years, really—constructing the conditions to make the larger deal happen, backing the Legislature into a corner where it had to choose between helping to write a painful budget now or helplessly watch Cuomo dictate a more painful budget next week. The governor has used the full arsenal of weapons—from crowd-stirring speeches to leaks to friendly reporters to appeals to patriotism to ruthless intimidation—in an artful, coordinated assault unlike anything modern Albany has experienced. Lately Cuomo has been lucky as well as good: The full-court press by Mike Bloomberg to tear up teacher-layoff rules has pushed a traditional adversary, the city’s teachers union, into Cuomo’s corner. Revolutions in the Middle East and a nuclear tragedy in the Far East have gobbled up media space that in normal years would have been devoted to exploring how Cuomo’s budget cuts could hurt senior citizens and poor kids.

Instead, the governor’s poll numbers have soared, and with the state’s April 1 budget deadline looming, Cuomo has artfully crafted two endgames in which he wins either way. Assuming the Legislature votes its formal approval this week, Cuomo can take credit for a rare on-time, dramatically slimmed-down budget achieved through even rarer cooperation. If negotiations had stalled, Cuomo could have imposed his own budget through emergency spending bills and blamed the stubborn Legislature for shutting down state government. Completing the deal the nicer way robs Cuomo of a melodramatic finale, but he’s nevertheless basking in positive headlines. “Andrew wants to make a splash, and he wants to be strong, and he’s getting praised on Morning Joe. They love him,” a Democratic ally says. “And that’s what gets him going, the national media attention.”

Editor’s note: This story has been updated to reflect the budget deal announced by Andrew Cuomo on Sunday, March 27.

Photo: Hans Pennink/AP Photo

Cuomo is generating 2016 presidential speculation even while turning down national media appearances, smartly appearing to dial down his ambitions by staying focused on his own backyard. He’s letting Chris Christie be this year’s fad while playing the long game.

As the deadline approached, the new, humble Andrew seemed to be wrestling with the old, arrogant Andrew; last week, the governor appeared to rub the Legislature’s nose in his assumed victory, bluntly declaring he’d get what he wanted whether the Legislature delivered the budget on time or not. But even that gambit paid off: Legislative leaders fell all over themselves professing their eagerness to deliver an on-time budget. Cuomo reacted warily, determined to avoid being trapped into expensive last-minute compromises. When he restored a few hundred million dollars to education and social-service spending and agreed to take full responsibility for closing prisons, sparing legislators some local anger, the budget framework for the next two years was set.

Cuomo’s gamesmanship has put him in a position to pass a historic budget in incredibly difficult fiscal circumstances and to fundamentally shift the state’s finances. And where Chris Christie and Scott Walker have succeeded by humiliating their opponents, Cuomo has, up to now, succeeded by appearing to bring almost everyone into the tent—unions, hospitals, even Republicans—in a way that’s both Democratically touchy-feely and as hardheaded as anything his counterparts are putting forth. Cuomo’s austerity budget will probably feature $2.3 billion in cuts to Medicaid and $1.5 billion to education—and be adopted with the support of many of the very people whose budgets are being hacked. “It’s like catering your own funeral,” one operative says. It may also be a road map for Democratic success elsewhere—if one big question can be answered, that is: Are we sure “progressive austerity” is not an oxymoron?

Cuomo has been helped immeasurably by fortunate timing, arriving at a moment when the state’s finances are in undeniable shambles; labor unions, nationally and locally, are on the defensive; and the State Legislature, after a truly execrable run of scandals and squabbling, is held in contempt by New York’s voters. But Cuomo has never been accused of passivity, and he began rearranging the Albany playing field to his advantage long before he was elected governor. Last spring, while still state attorney general, he quietly encouraged Governor David Paterson to use a parliamentary maneuver known as “extender” bills to force his spending choices on the Legislature. Paterson, having given up hope of running for governor, had nothing to lose, and Cuomo had plenty to gain from establishing a precedent, even though Paterson’s use of the emergency appropriations method allowed the Legislature room to bargain. “That’s the genius of the guy,” a lobbyist who knows Cuomo well says. “He was envisioning how he would do things, and he was using Paterson as a test case. In many respects, there’s no one out there better at triangulating.”

Cuomo continued laying his foundation during the campaign, establishing the broad budget themes he’d pursue as governor: no new taxes, a cap on property taxes, a downsizing of government programs. He assembled the support of business as well as private-sector labor groups. How enthusiastic they were didn’t matter; such broad support allowed Cuomo to assert that he had brought everyone together, a true coalition, all of them pledged to his platform. Trouncing hapless Carl Paladino in November made Cuomo the truest believer that “the people” back his policy choices.

He’s projected energy and confidence since taking over officially in January, which has helped push Cuomo’s public-approval numbers into the high seventies. Cuomo’s loudly professed amazement at built-in budget boosters was greeted with laughter by the Albany Establishment: Of course Cuomo, who’d been around state government much of his adult life, knew how the sausage got made. But, crucially, Cuomo’s shock went over much better with the public: His retailing of the budget sham played right into its perception of Albany as a rigged casino and positioned the new governor as the last honest man in town.

Photo: Richard Drew/AP Photo

Meanwhile, Cuomo set about cajoling and prodding the other players. He invited groups of legislators to the governor’s mansion for bagels and policy chitchats, part of his multipronged charm offensive. At one session with Democratic state senators, Cuomo welcomed everyone, then opened the floor to discussion. Talk quickly turned to one of this year’s most contentious issues, the “millionaire’s tax.” Adopted in March 2009, as the recession worsened, it slapped an extra one percent levy on joint incomes above $300,000 and brought in more than $3 billion in additional revenue. But the tax was temporary and scheduled to expire in 2011. Cuomo had promised to let it disappear. Now, though, with the state planning to slash funding for Medicaid and education, legislators, particularly in the Assembly, were pushing for its extension, arguing that the state’s wealthiest had already received a federal break when the Bush tax cuts were continued this past December. Cuomo’s budget proposes cutting the state’s spending by 2.7 percent from last year’s total, with the biggest hunks likely to disproportionately affect the poor; extending the millionaire’s tax seemed a fair way to mitigate some of the consequences. Yet Cuomo didn’t budge, reiterating his claim that the millionaire’s tax would drive business and residents out of state. And he knew how easy it would be for them to leave, because his primary residence was about six minutes from the Connecticut border, in Mt. Kisco. That was too much for Westchester’s Suzi Oppenheimer.

“First off, I have plenty of rich people in my district, and they’re not moving,” she told Cuomo. “Second, stop saying you live in Mt. Kisco! You don’t! I know exactly where you live. You live in my district, and I don’t have Mt. Kisco. You live in New Castle—but that’s upscale, and you want to be more blue-collar!”

Cuomo started to say something about the distinctions between a mailing address and a tax address. But then he gave it up and smiled. “All right, Suzi, you’re right,” he said. “I don’t live in Mt. Kisco.” Laughter filled the room. “He defaulted to humor, which I thought was very good,” says an Assembly member who regularly disagrees with Cuomo on policy but at that moment couldn’t help liking him.

“Cuomo is orchestrating a big game of musical chairs. But only about half the players have chairs.”

Playing nice has practical value for Cuomo in helping to line up votes. But the appearance of playing nice is equally if not more important for a politician still trying to live down a reputation for pugnacity. Particularly because Cuomo isn’t relying completely on bonding to get what he needs. He encouraged the creation of the Committee to Save New York, a business group that has spent nearly $2.6 million on pro-Cuomo advertising and outreach. And Cuomo has reminded legislators, regularly yet subtly, that he knows how to play rough if necessary. Sometimes the message is sent through the Post’s legendary Albany columnist, Fred Dicker, who frequently quotes “sources close to the governor” railing against Shelly Silver, the Assembly leader, and Dean Skelos, the Senate boss, as enemies of reform. But capitol insiders know to read past the headlining jabs in Dicker’s columns for the important paragraphs. “Take that recent column that said Skelos is in trouble with his members,” says one of Cuomo’s legislative allies. “The interesting part was the second item, which said the reason the ethics bill is not happening is because Senator [Michael] Nozzolio has a law firm and doesn’t want to reveal his clients. I read that to be a signal from Andrew: ‘I’m coming after your members, and I’m going to get into their shit.’ That kind of thing will move people.” Cuomo has also craftily stirred other major issues, including legislative redistricting and gay marriage, into the mix periodically—in part because he wants them resolved, but also as bargaining chips or signal-senders to constituencies. “If you don’t keep people in Albany busy, they’ll assume you’re busy screwing them, because that’s how it’s been in the past,” a Cuomo adviser says.

Cuomo is a gifted storyteller. He uses long pauses, multiple accents, shouts, breathy whispers—he puts on a real show. A former Cuomo operative remembers one of his old boss’s favorite tales about a predecessor, Nelson Rockefeller. Cuomo quizzed one of Rocky’s powerful aides, Alton Marshall, about the wealthy governor’s success with the Legislature. “Ah, Rocky,” Marshall told him. “Rocky would bring ’em over to the mansion, he’d sit around, they’d have a few bottles of wine, they’d have some cigars. He’d say, ‘What do you need? How can I help you? I like you.’ Oh, yeah, Rocky, he owned ’em. They loved him. He was charming.” Cuomo, the ex-aide says, was inspired, believing he had the skills, if not the libations, to work the same magic. “Yeah,” Marshall said, “and you know, every once in a while, you gotta take one of these guys outside and shoot him.”

Cuomo has deployed specialized pressure to the two powerful legislative bosses, Silver and Skelos, designed to fit the differing personalities and political needs of the two men. Last November’s election results returned Skelos to majority leadership; his Republican caucus has a slim numerical edge on the Senate Democrats but a vast advantage in discipline. The Senate Republican agenda is tilted toward its suburban Long Island base, making Cuomo’s proposal to cap property taxes and slash government spending a natural fit. He tells Skelos that they share an agenda and that the Republican leader and his members will gain respect with the public, showing they’re above politics, by compromising with a Democratic governor.

To those carrots, Cuomo adds two sticks: Skelos doesn’t want to discuss tougher ethics standards until after the budget is done, and he’d like to stall proposals for nonpartisan redistricting—the adoption of which would be a demographic death sentence for his Republican majority. Redistricting is required by law, but Cuomo isn’t forcing the issue of how lines will be redrawn—for now, anyway, which helps his relations with Skelos.

Photo: Mike Groll/AP Photo

The handling of Silver is at once more delicate and more muscular. Silver has been the leader of an impregnable Democratic majority in the Assembly for nearly two decades, so Cuomo tries to shake up the speaker’s sense of security. One method is jabbing Silver through Dicker’s column in the Post; another is subtracting some of his closest Assembly colleagues by giving them jobs in the Cuomo administration. Cuomo also has some policy chits to play with Silver, knowing that the lower-Manhattan Democrat is a fierce defender of rent regulations, which are set to expire in June. But the governor is banking even more on the unwillingness of a Democratic speaker to feud with a Democratic governor who enjoys vast public support and is willing to use it to punish dissenters.

Cuomo’s neutralization of two other forces in the annual budget wars has been equally deft. More than a third of the state’s money is spent on Medicaid, making it a necessary and obvious target for cuts, and yet each year the same ritual plays out: The governor proposes cuts to health care; the state’s hospital lobby and the union representing health-care workers spend millions of dollars in maudlin TV ads decrying the cuts—on top of the millions they contribute to elected officials; the governor’s poll numbers decline, and he agrees to an expensive truce that barely makes a dent in rising Medicaid costs. Cuomo invited the foxes into the henhouse, which he named the Medicaid Redesign Team, and asked the major health-care players to come up with cuts—or else he’d impose them. And Cuomo got key participants, including the Greater New York Hospital Association and SEIU 1199, which represents health-care workers, to publicly commit to participating before specifying just how much money he wanted to see slashed: $2.9 billion. “When we got the number, we were ready to walk out,” one health-care-­industry participant says. But Cuomo’s calculation assumed the worst in every equation, raising the amount that supposedly needed to be cut. “The way he got to $2.9 billion was nutty,” the Medicaid insider says. “Then he said he wanted a 2 percent cut from current spending, which is a lot easier to deal with.” Cuomo’s math says the MRT achieved $2.3 billion in cuts, with an almost $1 billion year-to-year reduction in state spending. The deal was fragile, however, appearing to hinge on the inclusion of a cap on medical-malpractice awards for pain and suffering that’s a priority for hospitals. Silver and the Assembly staunchly opposed the cap. So Cuomo, in the final weekend of bargaining, settled for the inclusion of a fund that indemnifies hospitals in lawsuits over brain-damaged infants. The Jenga-like Medicaid package held together.

Another power Cuomo had to contend with was Mike Bloomberg. His chosen tactic was jujitsu, turning Bloomberg’s force to his own purposes. For months, the mayor had maneuvered to scrap the state law requiring that teachers be fired according to seniority, arguing that budget cuts were going to force him to lay off good young teachers instead of underperforming lifers. His loud and expensive campaign had finally succeeded in passing a bill through the State Senate that would allow for merit-based personnel decisions in the city’s schools. Four minutes after that bill was approved, Cuomo shot it down, releasing his own fuzzy proposal for an “objective” evaluation system, to be implemented eventually.

Cuomo’s team claims it’s all Bloomberg’s fault, that the mayor has been disingenuously crusading for the end of “last in, first out” when what he really wants is the freedom to can the hundreds of teachers already rated “unsatisfactory” and the thousands drifting between schools in the reserve pool, and that Bloomberg is attempting an end run around collective bargaining. But Cuomo’s sympathies for the legal rights of labor are heightened by his desire for peace with the United Federation of Teachers, which represents the city’s educators. The UFT, in turn, needs Cuomo’s protection. “Bloomberg hands Cuomo a giant gift by making all this noise about seniority layoffs,” a friend of the governor says. The mayor didn’t get the schools rules changes, or much of the state money he sought, and voiced the loudest immediate objections to Cuomo’s budget.

Keeping labor relatively happy, however, helps Cuomo become the leader of a new national Democratic identity, one that contrasts with the Republican right’s union-bashing yet is fiscally conservative and socially progressive. The message is that the unions can be a full partner in the budget-cutting process, not political pariahs, as Scott Walker tried to make them. “New York can be a beautiful model, if we get this done, to say, ‘Guys, you used the stick when the carrot really worked,’ ” a Cuomo associate says. “ ‘Why didn’t you try bringing them in and sitting them down and looking them in the eye and putting out your hand and saying, “We need to do this together”?’ ” And if that approach fails, Cuomo has made clear, he’s willing to be tougher than Walker, Christie, or anyone else. In a sense, it’s a return to the nineties Democratic identity personified by one of Cuomo’s political mentors, Bill Clinton. The Big Dog, however, was willing to end welfare as we know it, infuriating the left; Cuomo has passed up the chance to challenge Democratic orthodoxy and tell the teachers unions that seniority protections need to end because the archaic rules are damaging the unions’ credibility even more than they’re hampering what goes on in the classroom.

And all these machinations make some people a bit queasy. Even supporters wonder whether Cuomo will screw up all his good work by trying to be too clever—an old Cuomo problem. “I don’t think Andrew is dishonest,” a longtime associate says. “I think he creates his own realities, and he thinks that something happened that didn’t happen, and he thinks there was an understanding that really wasn’t an understanding.”

He’s been careful not to let the old Andrew emerge, but sometimes he can’t help it. The day after the MRT unveiled its plan, Cuomo took a victory lap on Dicker’s radio show. “I remember a radio reporter who’s also a reporter for the Post who said the Medicaid-redesign team is a test for the new governor and it may very well disintegrate,” Cuomo said, sounding like his chesty former self.

“Wasn’t that off-the-record?” Dicker joked.

“I remember hearing that on the radio. I don’t remember who said it,” Cuomo said.

“I admit it, I was wrong on that,” Dicker replied.

“I’m sorry, what did you say?”

“I was wrong on that,” Dicker said, starting to sound irritated. “Touché.”

“I’m sorry, I have a bad connection. What did you say? What? I’m sorry.” Cuomo chuckled. His laugh is a thing of art, and a weapon: He starts lightly, then deepens the tone, then the heh-heh-hehs continue long past the point of mirth, until he’s the only one laughing and the sound becomes downright unnerving.

Whether the final budget deal is merely a triumph of politics or one of substance on other fronts will take time to discern. Cuomo counts himself a progressive, yet his claims for the boat-lifting abilities of private industry sound an awful lot like discredited trickle-down economics. The city should benefit from changes to the costly home-health-care system. But the city will take severe hits to education and social services, including a multimillion-dollar cut in state rental assistance to low-income families, which could jeopardize housing for thousands of families. “That’s the one that shocked me,” a city official says. “Given Cuomo’s good background in creating housing for the homeless, and the fact that it’s a constituency without political power, this just seems callous.”

“You should not underestimate how painful this budget is,” another Bloomberg aide says. “The education cuts are really rough. This is not a traditional Democrat’s budget. Maybe that’s what the moment requires. But the choices Cuomo is making are going to be pretty painful for working folks.”

Pulling off a balanced, shrunken budget while keeping his constituencies relatively happy would be an amazing feat. There are inherent contradictions with progressive austerity, and the governor may merely have delayed the moment when one interest group’s happiness means another’s misery. “Cuomo is orchestrating a big game of musical chairs,” one Albany insider says. “But only about half the players have chairs. How long can he keep the music playing?” Major obstacles remain. The property-tax cap doesn’t look as if it will be adopted, partly because Cuomo has yet to deliver on his vow to reduce the number of costly programs the state imposes on localities. Tackling New York’s gargantuan pension and health-care liabilities promises to be a nastier battle than the budget. Yet Cuomo’s current success is giving him the national profile he’s always craved. He soon could be bigger, in the most important ways, than Chris Christie. Much like the progressive austerity he’s pushing, it would be a remarkable and unlikely transformation for the famously prickly governor. But he believes in it. And that’s the first step.

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The Gamer