Blooomberg's Power Grab Proves Him Unfit to Rule

Today the City Council of NYC voted to give billionaire Mayor Michael Bloomberg (and incidentally themselves) a free shot at a third term in spite of the fact that New York City law limits him (and them) to two terms.

This raises sharply a question I’ll frame as fitness to rule. Bloomberg’s power grab has been rationalized with the assertion that he is uniquely competent to steer the ship of city through the troubled waters of the ongoing economic meltdown.

That’s a big fat lie, and one that is readily refuted.

First, Bloomberg’s backers cite his expertise in practical economics. Well, this bozo heads the world’s premier economic news service. He has easy access to information that the average citizen of NYC will never get to see, and he was blindsided by the crisis as surely as George W. Bush and the financial establishment. In fact, the ballyhooed letter signed by 30 prominent “municipal leaders” to tout his third term bid included the names of the CEOs of Goldman Sachs, JP Morgan and Morgan Stanley. Oh, well, if they want him around for another four years, it must be okay…

Second, while he deserves some credit for keeping the city bureaucracy running smoothly, Bloomberg also spent the last seven years pushing policies that have made NYC more vulnerable to the crisis which is engulfing us. He promoted financial and real estate speculation; he gentrified the entire island of Manhattan and chunks of the other boroughs with luxury condos and rentals; he continued the erosion of manufacturing, costing New York a broader economic base and many unskilled and semi-skilled jobs; he hammered upper level unionized workers, like teachers, transit workers, firemen, who comprise the social and economic backbone of NYC; he worked to turn the city into a tourist destination for an global elite who aren’t going to be able to afford luxury stays in the Big Apple in the middle of a worldwide smashup either.

Third, with this move Michael Bloomberg shows his deep contempt for democracy and the right of New Yorkers to choose our leaders. You can argue the merits and problems of the two-term limit for elected officials all day and all night, but it was passed by New York City voters—twice—in referendums in the 1990s. Now Bloomberg has made an end run around that decision. Worse, his accomplices in the City Council voted down a resolution which would have put the question before the electorate again in a special referendum and instead arrogated to themselves the right to kick New Yorkers' decisions to the curb. This is a guy who switched from Democrat to Republican to find a ballot line the first time he ran and now calls himself an “independent,” a guy who used his fortune to buy his way into office in two straight campaigns. spending $85 million on his 2005 re-election alone. That’s a million more than John McCain has collected in public funding for his whole campaign since the Republican National Convention!

We’d better lose the idea that anybody’s going to ride in on a white horse to save working people in this growing mess, let alone some billionaire who thinks that following the rules is for peons like us. We've got to organize ourselves to stop the rich from sticking us with the whole tab, to support and defend each other, to develop new methods of survival and solidarity, to start to design a NYC that serves our interests and betters our lives, not those of the high and mighty. They are not fit to rule.

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Meltdown Message for City Folk: Get Green Or Go Hungry

I just got back from an early morning harvesting trek in Harlem and Morningside Heights, bringing home a couple of pounds of ginkgo seeds, or ginkgo kernels to be more exact.

I was turned on to these little pistachio-looking treats years ago by my friend Iz, who recommends toasting and eating four or five of the innermost nutmeats a day—far better than the health food store ginkgo preparations which are made from the leaves of the gingko tree, says she. Better for what? Memory, it seems, though it’s kinda hard to tell how well they work since most years I forget to go collect some before the late autumn season is over.

Another friend, Chip, provides a different reason to lay in a stash. When his wife Kim’s mother visits the States—the family is Malaysian of Chinese origin—she can’t believe that people just leave this delicacy lying around on the lawns and sidewalks. She collects bagsful and uses them as the base for tasty soups.

One reason you may never have considered a ginkgo seed-based dish is that the soft outer part of the seed (often called the fruit although that’s not botanically correct), stanks! In fact, gentrification is making the ginkgo scarcer in Manhattan even though their dense foliage, long leaf season, longevity and general hardiness makes them a splendid street tree. But the yupwardly mobile object to the occasional autumnal whiff of ginkgo seeds and demand that the city cut them down and replace them with cloned male ginkgos, which don’t bear seeds, or something “nicer.”

Well, gingko seeds don’t stink half as bad as the economy these days, and I felt a little rush of righteousness as I was out harvesting. The fact is that in a depression, the reliance of US cities on food supplies from far across the country and around the world is going to become a real pinch point.

We have to start thinking more seriously about urban agriculture (and about building real human to human ties between city consumers and family farmers) as this crisis deepens.

It comes as no surprise to me that Robert Biel, whose prescient 2000 book The New Imperialism (summary review here) exposed some of the contradictions in global capitalism before they started ripping the world asunder, is ahead of the curve on this front too. The following video introduces an organized effort to create a model of permaculture, intensive agriculture, in a block of flats (projects, we call ‘em here) in the South London neighborhood Brixton.

It is clear even to some bourgeois economists that any hope the capitalist system has of recovery from the growing depression we are in will require a newer, “greener” system of accumulation, different from both post-Great Depression Keynesianism and the last three decades of neo-liberal market worship. This is an early look at one first step from the side of the working class, not the think tanks of capital.

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When the chickens get privatized,

it's vultures that come home to roost.

The subprime mortgage crisis isn't over. Neither is the global credit freeze it sparked. The stock market crash that followed hasn't hit bottom yet either. But the main thing to worry about now, and for a long time to come, is the depression we are rolling and tumbling into.

The media has started reporting on one increasingly visible aspect of the depression: the budget crunch facing states and municipalities, and the resulting cutbacks in public services. News stories have detailed the end of the shuttle program Phoenix, AZ ran to take seniors grocery shopping, Mayor Daley's elimination of 2250 Chicago city jobs--900 by layoffs, warnings of unsalted roads in rural Wisconsin this winter, and on and on. And it's early days yet.

The service cuts I want to highlight today are a little different. Let me direct your attention briefly to the Los Angeles County Metropolitan Transportation Authority, which serves 1.5 million rail and bus passengers every day. Yep, even in auto-centric L.A., a lot of folks, especially poor folks, can't make it without public transportation.

Terry Matsamuto, the MTA's chief financial officer is predicting massive service cuts soon. It seems that like many local governments around the country, L.A. County went for the okey-doke. They sold much of their system to private investors in "lease-back" deals. Companies like Wells Fargo and Philip Morris bought the rail system, 1000 buses and parking and maintenance facilities. The Tranist Authority gets a one shot injection of needed cash, the financiers get a steady annual cash flow bled out of the system.

The rail cars and locomotives of the Metrolink commuter rail system were also sold, and guess who financed and insured these deals?

American International Group.

Yep, AIG. And when AIG started going into cardiac arrest, their credit ratings were revised downwards before the Fed even applied the paddles.

The lower credit ratings triggered a clause in the lease-back agreements that require the MTA to either find a new firm to guarantee the deals or reimburse investors for their down payments and lost tax benefits, a scenario that could cost the transit agency between $100 million and $300 million.

For one thing, forget about finding a replacement lender--credit is still frozen, static. Second, once other clauses in the deal kick in, the MTA could be on the hook for $1.8 billion this year, more than half its total annual budget.

All those investors have to be made good somehow. So the service cuts commence.

I can't wait to see what L.A.'s Bus Riders Union does about this...

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As The Economic Meltdown Deepens...

The ongoing economic meltdown is terrifying, but at the same time many of us have no real idea of what’s rolling down the pike at us.

There are many aspects of the crisis and the coming recession which are impossible to predict. One impact though, will be unavoidable: crippling budget crises at the state and municipal levels, driven by falling real estate values, layoffs, business closings, increased borrowing costs and recession.

What Happens When the Banks Don’t Lend

To get a sense of what this could look like, it is instructive to look at what happened to New York City starting in 1975, when bank credit dried up and a fiscal crisis that lasted more than a decade kicked in. Remember that this was a budget crisis isolated to one city, rather than the generalized collapse of the banking system we are seeing now.

The immediate background is that by the early ‘70s, the City’s budget was deep in the red, kept going with fiscal jiggery-pokery especially in Mayor Lindsay’s second administration and under his successor, Mayor Beame. The back story is more complex of course, having much to do with federal policy since the Eisenhower administration which directed resources to suburbanization at the expense of city and country—money for interstates, not mass transit and railroads, subsidizing vast auto-dependent tracts of single houses on what had been farmland—you know the deal.

What plunged the City into crisis was the large banks refusing, collectively, in March, 1975 to extend credit to New York any longer, declining to roll over loans and boycotting the City’s bond auctions. The Beame administration moved to lay off 25,000 city workers and defer contractual raises for others, cut services, increase the transit fare and institute tuition in the City College of New York system.

For months there was a political war over how things would get resolved,, with highway workers, cops and other city employees staging militant demonstrations and threatening an October general strike. The NY State government stepped in with aid but the federal government refused until massive pressure from the financial industry was brought to bear.

With everyone staring into the abyss of bankruptcy (and the possibility of a judge writing off the bonds the banks still held or canceling union contracts), the municipal unions made a devil’s pact with the banks, the details of which I leave for another post.

"The Bronx Is Burning"

What I want to remind people of is what happened to NYC once the austerity, service cuts, layoffs, tighter credit, tax hikes and the rest of the bank-sponsored “rescue package” kicked in.

Garbage piled up in the streets, and law enforcement abandoned whole neighborhoods. The public education system, already jolted by the refusal in the ‘60s of Blacks and Latina/os to accept a two-tier, heavily segregated system, now faced serious cuts. Class sizes ballooned. “Non-essential” programs like art and music education and vocational training disappeared.

The Transit Authority adopted a policy of “deferred maintenance”—only fixing things when they broke down completely. One leader of the militant opposition within Transport Workers Union, Local 100 at the time, Arnold Cherry, pointed out whenever he spoke that every housewife knows that if you don’t empty the crumbs out of the toaster, eventually it stops working. Not TA management, though—the system veered toward total collapse in the early ‘80s.

Meanwhile, landlords in “bad neighborhoods” emulated the Transit Authority, milking their aging apartment buildings for every dime in rent they could collect while "deferring” maintenance, laying off supers, ignoring heating oil bills, and finally abandoning the buildings themselves rather than pay city taxes. Or, given a chance, burning them down to collect the insurance.

This was seared into the national consciousness in the famous blimp shot of a five alarm fire in the South Bronx during the 1977 World Series while Howard Cosell intoned, "There it is, ladies and gentlemen, the Bronx is burning." As much as 40% of the housing stock in the borough was destroyed during these years, increasing an impossible-to-ignore homeless population and pumping up rents for vacant apartments in surviving buildings. (The City, meanwhile, was closing firehouses as a money-saving measure.)

Huge cuts in the NYC medical system on top of deteriorating social conditions laid the ground work for what Nick Freudenberg and his co-authors identify as a deadly “syndemic”: the three interlinked epidemics of TB, murder and HIV infection.

Even after the emergency financial aid was paid back, and the City’s budget was balanced and the banks decided they would once again buy long term bonds issued by the city (1981) , the Emergency Financial Control Board kept austerity policies in place and the damage they did to millions of people reverberated through the decade and up to the present. To cite only one example, the City College system which had boasted free tuition for NYC residents before the crisis, now costs upwards of $2000 a semester.

What It Means

I could go on. There are a lot of particular lessons to learn from the New York City fiscal crisis, and how various social forces responded and what kinds of popular resistance developed and worked.

But lesson number one is that this kind of crisis is on the agenda right now, in cities around the country, and once it erupts, there is no quick bounceback. Start trying to size up the situation where you live and figure out who your allies are going to be in the coming years.

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Capitalism Can’t Help Showing Its Ass These Days

I hadn’t been to an AIDS demonstration so far this year (my bad) but the prerecorded announcement from the ACT-UP phone tree last night haunted my sleep and got me out of bed and headed for midtown this morning. The demo here in NYC was part of an international week of actions (including Arizona, Thailand, France, Switzerland and more) targetting pharmaceutical giant Roche. The demand was simple: Roche must negotiate with the South Korean government to lower prices on bulk orders of lifesaving AIDS drug Fuzeon for its national healthcare system.

What got me going was hearing the quote from Urs Fluekiger, marketing director for Roche Korea, who explained the company’s refusal to budge on their $22,000 price tag for one patient/year of this vital medication:

We do not do business for saving lives but for making money. Saving lives is none of our business.

I thought to myself, okay, that tears it. It’s getting harder and harder to find anyone saying a kind word about good old freemarket capitalism, what with the mounting wreckage that is the global economy these days and the hurt that will be put on everyday working people here in the US and around the world in order to rescue the bloodsuckers who have benefited from this system.

There’s every reason we should make a point of kicking ‘em while they’re down.

So I did my little bit today, leafleting at a characteristically lively and imaginative action by ACT-UP’s New York and Philly locals and other AIDS groups. Scores of people grabbed fliers as they rushed to work in the skyscraper housing LifeBrands, Inc., the ad agency that Roche employs to promote Fuzeon.

There’s plenty more detail to deepen your rage at Roche--how they bought out the company that was given the rights to this drug by the government, which sponsored the original research, how their executives have shut down all AIDS and HIV research, how their profits last year exceeded 30%. But that one quote tells the story, about Roche and about the whole system they have made themselves such a success in.

We do not do business for saving lives but for making money. Saving lives is none of our business.

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