Why de Blasio shouldn’t tap out in his tussle with Cuomo
You may remember Robert De Niro's face as Jake LaMotta in “Raging Bull” – battered and bloodied. Such is the political visage of New York City Mayor Bill de Blasio after repeated shellackings at the hands of Gov. Andrew Cuomo. De Blasio now seems to have abandoned pushing major progressive issues. Appeasement comes with a cost, though. The governor is ramming through a huge tax increase that falls largely on New York City, without the city benefiting at all. There are literally billions of dollars at stake, yet the mayor is nowhere to be seen.
Cuomo has proposed and pushed through a new tax, with a statewide cost of more than $7 billion. The great bulk of the tax will be paid by downstaters, including citizens, businesses and nonprofit institutions like museums, hospitals, the Metropolitan Transportation Authority and the city’s Housing Authority. The only measurable benefits are to a select few upstate communities.
The Cuomo proposal is a flat tax on electric bills. The statewide cost is $7.6 billion over 12 years, the largest single tax increase in decades. The New York City or downstate share of paying that tax is at least 60 percent.
The underlying issues are important and a little complicated. Late last year, Cuomo decided to do something about global warming and carbon pollution, in his usual bull in a china shop manner. He demanded and got a Clean Energy Standard package through the state Public Service Commission. In many ways this is an excellent thing. State government can and should reduce the use of fossil fuels in the state and the plan that emerged has tough, laudable and far-reaching elements.
However, a central part of the governor’s plan is a taxpayer subsidy for four failing and decrepit upstate nuclear power plants that were being closed by their owners because they lose money. As part of a zero-emission plan, the plants would stay open and receive the $7.6 billion as a subsidy from taxpayers.
Cuomo’s original justification for the new tax was the need to protect the upstate economy. They backed off a little and now emphasize the carbon reduction benefits of keeping the plants open. That desirable goal should be the beginning of the decision process not the end, and this is where the mayor could step up.
There are significant drawbacks to the Cuomo proposal and significant unanswered questions.
First, the tax is incredibly regressive – a flat sales tax regardless of one’s ability to pay. There are ways to cushion the impact on working families, hospitals and small businesses that were never proposed or discussed, such as exempting a reasonable monthly usage from the tax.
Second, there are cheaper and better ways to meet the zero-emission goals. Our old friends wind, solar and conservation all work and all need a bigger slice of the pie.
Third, the state has turned its back on safety concerns. At Westchester County's Indian Point nuclear power plant, Cuomo demanded and got an expedited closure of the plant and a role for the state in monitoring plant safety. The state expressed no similar concern for the safety of upstate plants.
Fourth, and most politically potent, downstate is paying for air quality improvements upstate. There's nothing particularly new about downstate money flowing to upstate communities. Regional subsidies are a way of life in New York, and should be. The booming economies of New York City and its suburbs contrast starkly with the economic decline of upstate rural communities and cities. For decades, downstate taxpayers have paid much more to Albany than they received back in state aid and state programs. Conversely, upstate taxpayers got much more in state benefits than they pay in state taxes.
The philosophy behind this is ingrained in our politics. Wealthier communities pay a progressive income tax to fund programs that are beyond the means of poorer communities. For example, upstate school districts often get 70 or 80 percent of their budgets from the state. Suburban districts may get 10 or 20 percent and the city gets 40 percent of its school budget from the state.
But the Cuomo energy tax goes way beyond these traditional policies. It's much bigger. It benefits four named facilities, not general programs or services. It was hidden and excluded from the budget or legislative process. And, again, downstaters get no real benefits.
Enter Mayor de Blasio. Or rather, exit Mayor de Blasio. He has said little about the proposal and its impact on his constituents. He's learned, painfully, the political cost of taking on the governor. Things have not gone well when he mixes it up with Cuomo, be it taxes to pay for pre-K, affordable housing programs, CUNY investigations or homeless programs. The mayor has been regularly beaten up in these disputes, even when he was right. He is now facing a re-election campaign that has the specter of Cuomo haunting it. Will the governor back an opponent? Will he help fund an opponent? Who might he tap? The recent de Blasio response, in the immortal words of boxer Roberto Durán, is “No más.”
De Blasio has a better re-election argument than the one he has been making. He's kept his major promises on dramatically reducing stop and frisk and expanding pre-K. Crime is low. The city is addressing the consequences of the Bloomberg years that were so good for the wealthy, not so much for working folks. Affordable housing and homelessness are on the front burner, even if the administration has botched important programmatic pieces.
Yet the city has never warmed up to him – only recently has his approval rating nudged above 50 percent – and he's stepped on his own necktie too many times. Add that to the recurring bloody noses he's gotten from Cuomo and maybe his new philosophy is the right one: Peace for our time.
But the Cuomo electric tax is just too unfair and too big to be swept under the rug. Four progressive downstate Assembly members including Bronxite Jeffrey Dinowitz, Manhattanite Brian Kavanagh, and suburbanites Amy Paulin and Steve Englebright are shoveling as fast as they can in opposition to the tax. But they need the mayor to state the case for his people and to seek changes that make any tax fairer for city ratepayers. As hard as it may be to tangle with Cuomo, the best re-election politics are standing up for what you believe is right and what works for the people whose votes you want. Even Jake LaMotta survived and they made a movie about him. How about it, mayor?
Richard Brodsky is a former assemblyman who serves as a senior fellow at both Demos and New York University’s Robert F. Wagner Graduate School of Public Service.