Running On Empty: The Cash Crunch

Photo: Thomas Fuchs

Felix Rohatyn
Investment banker, former ambassador to France
What Mayor Bloomberg is facing is a city that was left with a large budget hole by the Giuliani administration, and then had the Pataki administration dig an even deeper hole. It’s now very late in the day. The city probably can’t borrow any more. The city desperately needs at the very least a commuter tax from the governor and the Legislature. And here, the difference between now and 1975 is telling, not only because we had a Democratic governor in Hugh Carey who was very helpful to the city but because we had a Republican Senate leader, Warren Anderson, who was also very helpful to the city because he understood how important the city was to the state. And that is certainly not what one can say for Senator Bruno. With respect to the federal government, I still think the mayor and governor should lobby for a national coalition of mayors and governors to lobby the Congress and the administration to provide special assistance to state and local governments for the next couple of years, because we’re not alone, and there’s about $100 billion of deficits coming at us next year from, I don’t know, 46 states that are all running big deficits because of the recession. We can’t deal with this by ourselves.

Barbara Corcoran
We should sell Gracie Mansion for $11 billion, which is what it’s worth, in my opinion, and I’m sure I’m off by a nickel at best. I figured it out, and it’s fifteen acres, at 43,560 square feet each acre, times $1,500 per foot is $65 million per acre for the raw land, which adds up to $975 million for land. If each floor of a building is 490,000 square feet (75 percent of square-footage of fifteen acres) and the building is twenty stories high, that would be 9.8 million square feet at an average of $1,000 per square foot, or $9.8 billion, so $975 million for land plus $9.8 billion for the building, totaling $10.775 billion. The city owes $3.4 billion, which would give us $7.375 billion, plenty left over to build the Second Avenue subway.

Tom Wolfe
In general I think that the approach to the budget has been too negative. There hasn’t been enough volunteerism involved. It’s amazing what people will do when given a chance. When the pooper-scooper law was passed, I said, “Wow, they think that’s really going to make any difference?” And it did. People voluntarily started cleaning up the streets. Then you could get into some really challenging voluntary stuff. Suggest strongly that all litigation, all negligence suits against the city, be held off for three years. You can file them but you do nothing for three years. And claims should be limited to $250,000. I’d be laughed out of the courthouse. But it would create an etiquette.

Norman Mailer
Thirty-four years ago, we proposed in the mayoralty campaign that New York City secede from Albany and become the 51st state—the state of the city of New York. That would have enabled us (so went our argument) to receive more federal funds. Since then, I don’t know that I’ve had a new idea on the budget.

Ed Koch
Former mayor
The salvation of the city lies with two taxes: the commuter tax, which should raise $500 million if you go back to the old one of one sixth of what a resident pays, and a surtax on income for those whose income exceeds $300,000, to raise another $500 million.

Legalizing gambling might be a good possibility for a revenue stream, but that takes two constitutional amendments, and we don’t have time for that. I am for gambling, but only if it is allowed in New York City. What you would do is authorize two or three sites, and then have major hotels bid on what they would pay to have those casinos located in their hotels. I assume the casinos would be run by the state, not privately, so the hotel won’t get the benefit of the gambling profits, but it will get the benefit of people staying at the hotel.

Also, tort reform, treating all claims against the city like claims against the state, which are handled by what’s called the Court of Claims, where there is just a judge, no jury. Currently the city pays out about $500 million a year in claims because juries don’t seem to realize the money comes out of their pockets.

Jerry Della Femina
We should charge people for smoking in the streets. We’ve gotten them out of the restaurants, these poor people. If anyone’s caught with a pack of cigarettes, it’s a fine. As they walk into Grand Central station, have somebody frisk them. Caught with a closed pack of cigarettes, a $5 fine. Caught with a half-filled pack, it’s $10. There should be a series of Bloomberg taxes. Parking rules: Forget about meters. If they’re standing at what appears to be a curb, cops should jump out and give a ticket. Even if you’re letting people out of your car. Cars have to be in constant motion. The minute the car stops, no matter what, even for traffic, cops have to give them a ticket. It’s a non-moving violation. Loud talking. Cell phones. Your cell phone goes off, boom, you collect on the spot. I think that personal freedoms are greatly overrated.

Hillary Rodham Clinton
When we fix New York’s economy, we fix the nation’s economy. That’s what I say to my colleagues in Washington. Most of the $21.4 billion committed from Washington has been either sent to New York or earmarked for specific projects related to the cleanup and recovery efforts, which are ongoing. So every dollar in federal aid we bring to New York—whether it is more funding to help the city rebuild from the attacks on September 11, an additional $900 million to cover the city’s homeland-security expenses, investments in transportation and education, or another extension of unemployment-insurance benefits—would be a big help to our economy in the city, and across the nation.

For the rest of this article, please buy the May 12-19, 2003 issue of New York Magazine.

Running On Empty: The Cash Crunch