Eliot’s Problem Child

Illustration by Zohar Lazar

It’s been nearly one year since Ashley Alexandra Dupré became an instantly infamous household name. The salacious lowlights of the sex scandal that sank Governor Eliot Spitzer are about to be replayed in plenty of places—and probably with some juicy new details: The Times, which broke the amazing story on March 10, 2008, recently won a court case to unseal the records of the federal investigators who toppled Spitzer, and the documents should conveniently be available just in time for the anniversary. They may shed some light on conspiracy theories that Spitzer was either set up or fed to the FBI by some of his many, many enemies.

Spitzer’s exit—in disgrace, the moralist crusader destroyed by his own immorality—will always be the first thing people recall about him. Yet in the life of the state, Spitzer’s time in office should be remembered for two elements that are far more important.

Though Spitzer wasn’t in power long, he nevertheless had a significant impact on the state budget. The current worldwide economic disaster has of course blown a gargantuan hole in New York’s finances. Yet Spitzer, during his mere fourteen months in the job, helped set the stage for the looming budget battle. Campaigning for governor, Spitzer had come across as a fiscal conservative, promising to slash profligate state spending, particularly on health care. True to his word and wielding his electoral landslide as a weapon, Spitzer loudly attacked the right villains: SEIU 1199, the powerful health-care-workers union, and its allies in the State Legislature. But all the tough talk yielded only modest immediate savings and emboldened his adversaries, who today are dug in deeper than ever. And Spitzer’s spending on education included a massive multiyear increase in school aid.

Instead of cutting back, Spitzer’s first budget added up to a 7 percent increase in state spending. His second budget, being prepared in the winter of 2007–8, was headed in a similarly expensive direction, based on economic projections far more optimistic—and ultimately far more off-base—than the forecasts Mayor Michael Bloomberg was using at the same time to begin reducing the city’s budget. Maybe Spitzer would have dialed back some of the increases, but they lived on after his resignation. As a result, cutting from the current budget will be even tougher, even with a $15 billion deficit forcing the issue. The ex-governor’s defenders say he won 80 percent of what he wanted, but that Spitzer’s victories, like slowing the growth of Medicaid spending, will only show up in the long term. Yet the numbers are only a small part of what he left behind. The true legacy of Governor Eliot Spitzer is Governor David Paterson.

The disarray of Paterson’s rookie year in office has been creative and ever widening. The one thing the dysfunction isn’t, however, is surprising. Not because of the crushing economic collapse that is overwhelming even the most skilled politicians, or because of the chaotic manner in which Paterson has conducted most of his adult life. Nor because of the physical blindness that makes Paterson dependent on other people for information. No, what makes Paterson’s stumbles as governor predictable, almost inevitable, is the how and why Spitzer picked him to run for lieutenant governor in 2006.

As attorney general, Spitzer had gleefully and successfully bullied opponents, and as governor he was sure to antagonize the deeply entrenched legislative leaders—it wasn’t just his personality but his strategy. However, Spitzer and his advisers knew they needed a way to make nice now and then. They needed a good cop, particularly in dealing with the State Senate and Assembly. “David’s entire career in the State Senate was based on how well he got along with people,” a former Spitzer aide says. “He’s smart, a lot of fun, and everybody liked him.”

Paterson also appealed to Spitzer by literally appealing to him. “We didn’t pick Paterson,” another former Spitzer insider says. “He came to us. He really wanted it. We had this little problem with Leecia Eve, and David said, ‘I can fix that for you.’ ” Eve, a lawyer who’d worked for Senator Hillary Clinton, was being heavily promoted for lieutenant governor by Harlem’s Old Guard, and Spitzer didn’t want to appear beholden to them. One of those bosses, however, was Paterson’s father; when Spitzer picked David Paterson, they had little choice but to stand down, somewhat angrily. So New York’s lieutenant governor was chosen because of a petty political annoyance and because he could provide some comic relief. Which was fine as long as Paterson stayed lieutenant governor.

Besides a colorful personal life, Paterson brought along something else: his chief of staff, Charles O’Byrne. The lapsed priest is Paterson’s temperamental opposite, a control freak; after Paterson became governor, no one met or spoke with him without O’Byrne’s approval. Paterson started out saying the right things and got credit for being early—and correct—about the scale of the impending budget disaster. The Paterson administration wasn’t exactly a smooth-running machine, but when O’Byrne was forced out in October over $293,000 in unpaid taxes, the wheels fell off completely. The Caroline Kennedy fiasco was only the most public manifestation. Relatively simple initiatives, from cleaning up brownfields to retooling the Rockefeller drug laws—things that should be a layup with Democrats having finally reached the political promised land, control of both houses of the State Legislature—have been completely stalled. Paterson’s most ominous performance, however, has been on the budget: Instead of backing up his prophetically dire warnings, he’s been weak and inconsistent. He proposed a tax on sugary sodas that wasn’t going to pay many bills, then seemed to casually abandon it; he’s been all over the map on the proposed $6 billion “millionaire’s” tax increase.

Last week, a desperate Paterson brought O’Byrne back from exile—though, in classic Patersonian style, he did so with maximum messiness. O’Byrne is kind-of, sort-of back, allegedly a mere “volunteer” in the governor’s reelection campaign. “Nonsense,” an Albany insider says. “O’Byrne is running the show again. Charles is not the kind of guy who would come back and do a half-assed job. And unless he’s completely in control, he’s not worth it.”

O’Byrne orchestrated an administrative shake-up last week, installing a new Paterson staff director and political consultant, among others. But all the political-class chattering about O’Byrne and personnel moves obscures a more serious problem. O’Byrne and the other aides are essentially mechanics, organizing Paterson’s life and controlling the flow of information to him; no visionary has been installed to solve the larger questions of where the state should go from here. “Charles knows even less about policy than Paterson,” one Albany veteran says. “He’s purely transactional.” The power void, when it comes to the budget negotiations, will be filled, as it has been for decades, by Sheldon Silver and the lobbyists. The first great test of the revamped Paterson administration will come over the $8 billion in unrestricted federal stimulus cash that will rain on the capitol over the next two years. If Paterson allows himself to be pushed around, the money, instead of going to job-creating infrastructure projects or to debt reduction or to holding the line on taxes, could be spent to increase the state’s budget yet again. “The hospitals want every stimulus penny for Medicaid, and the school lobby wants all the education money restored,” says E. J. McMahon, a state-budget expert with the conservative-leaning Manhattan Institute. “Their aims add up to a budget that grows at six or seven times the rate of inflation—at a time when we’re in a severe recession. It reminds me of what Mario Cuomo did during recessions: halfhearted cuts that weren’t enough, and massive tax increases. It succeeded in getting everybody mad at him and the budget end result was always worse. And that’s what’s gonna happen now.” If Paterson emulates Mario Cuomo, his reward will be defeat in 2010, probably by Andrew Cuomo.

Spitzer says he is rooting for a Paterson turnaround. “David is going to be, in the long run, a really superb governor,” he said last week at a party to watch President Obama’s speech to Congress. “I think he’s obviously being given a tough time by the media, and that’s reflected in poll numbers that are momentary, but only momentary measures. David, I believe, shares the right agenda and understands what we need to do, and will not only find his footing but will find the eloquence that defines him. And I look forward to that.”

Privately, however, he’s said to be pessimistic. And Spitzer has something extra invested in Paterson’s revival: any hope of restoring even part of his own reputation. Spitzer expected to be remembered for his spectacular demise. Paterson has given him something else to dread: being remembered for leaving behind an incompetent successor.

Additional reporting by Jada Yuan

E-mail: chris_smith@nymag.com.

Eliot’s Problem Child