There was no false drama, no demagogic theatrics, no pandering to the galleries. Instead, the new city budget—the last one that will bear Michael Bloomberg’s signature—was sealed with a handshake between the mayor and Council Speaker Christine Quinn.
The new budget essentially keeps spending flat at about $70 billion and includes no tax hikes. That’s what happens when government is in the hands of adults.
Mr. Bloomberg noted that this year’s budget was done “responsibly, without a lot of acrimony.” But that’s what New Yorkers have gotten used to in recent years. The mayor and the speaker have managed to come to terms with a minimum of posturing and pandering while producing responsible budgets in good times and bad.
That achievement is even more remarkable when you consider the strain that pensions and benefits continue to place on the city’s treasury. Mr. Bloomberg will never be accused of having been free and easy with taxpayer dollars, and yet his final budget was about 60 percent higher than his first budget, a dozen years ago. That startling increase, far above the rate of inflation, reflects the spiraling cost of public employee pensions and benefits.
The Citizens Budget Commission recently noted that so-called “legacy costs”—that is, the money required to pay pensions and benefits for current employees and retirees—will amount to about a quarter of the entire city budget in 2015. The cost in dollars, according to the CBC, will be nearly $18 billion. In 2005, that figure was $8.5 billion.
Adding to the next mayor’s challenges is a looming $2 billion budget deficit in fiscal year 2014-2015—and that figure doesn’t factor in any added costs resulting from juicy new contracts with the city’s work force.
A year from now, the city budget may not be sealed with handshakes and kisses. Regardless of whether the new mayor and the new Council speaker get along as famously as Mr. Bloomberg and Ms. Quinn have, next year’s budget talks will take place in a more charged atmosphere. The unions will be demanding absurd raises and retroactive pay even as the new administration struggles to close projected deficits. The city’s special interests and labor bosses have already made it clear that they expect to have more influence in the new administration than they had during the Bloomberg-Giuliani years. Based on the rhetoric coming from at least the Democratic mayoral candidates, there’s good reason to believe they’ll get it.
For now, however, fair play to Mr. Bloomberg and Ms. Quinn for taking care of business like adults. We’ve gotten used to that, but we may soon wonder how they managed it for all these years.
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