Mr. Ravitch, who was working on a plan to reform the state’s dismal system of budgeting, needed support—and fast. He wanted Ms. Wylde, a power broker among the Manhattan business set, to corral some of her members for a meeting with Mr. Ravitch. She obliged. “He’s going to try and bring together leadership from around the state, from business, from labor,” Ms. Wylde said, “because there’s no other way to accomplish this.”

In New York, the odds are never great for anyone attempting to easily pass a budget. But they’re particularly daunting now, with Governor David Paterson on the brink and the state $9 billion in the hole. So the pressure is on for Mr. Ravitch, the 76-year-old longtime fiscal lifeguard, who is charged with cleaning up the Capitol. As the state’s political classes consider his ascension in the event of Mr. Paterson’s resignation—the state’s current political obsession—Mr. Ravitch no longer has the luxury of operating behind the scenes. And the key question, which may soon be answered in very public fashion, is whether his idealistic and non-confrontational style can work in the Albany of 2010, where most any attempt at rational policy becomes quickly tangled in a thick web of dysfunction.

Mr. Ravitch’s reputation as a civic rescuer has a long history. Governor Hugh Carey tapped him from the private sector in the 1970s to save the fiscally struggling Urban Development Corporation. During the city’s fiscal crisis in 1975, he worked behind the scenes to avert municipal bankruptcy. He ran the M.T.A. from 1979 to 1983, bringing the beleaguered agency a new flow of revenues and turning it around from an era marked by derailments and track fires. After the stint in government, he helped turn around the Bowery Saving Bank, and occasionally popped up as a reasonable voice in various public fights, be it the battle over a West Side stadium (he opposed it) or the rescue of the M.T.A. in 2008 and 2009.

And until about eight months ago, he seemed content to stick to his life as an occasional adviser in the public sector, spending much of his time serving on the boards of a long list of charities and nonprofits. But Mr. Paterson, seeking to break a deadlock that had gripped the State Senate, pulled Mr. Ravitch back into the limelight, appointing him as lieutenant governor through an untested legal route that was ultimately upheld by the courts.

Spending his time at the top of a particularly troubled Albany administration is most certainly not how Mr. Ravitch imagined the capstone to his career in public service. (“I didn’t sign up for this,” he told Ms. Wylde bluntly, speaking of the complex political context that surrounds him.)
He clearly is no natural politician, nor does he have the appearance or manner typical of the state’s second-highest-ranking official. He speaks with a hoarse voice and takes deep, almost gasplike breaths as he talks. He dives quickly into budget-speak, and often appears tired, closing his eyes for seconds at a time. (His devotees point out he has had these traits for decades, and they proved something of an image problem when he ran, very unsuccessfully, for mayor in 1989.) He is blunt, he swears and he speaks with a candor rarely seen in a politician, espousing sometimes unpopular views without hesitation. At a lengthy talk at N.Y.U. in October, for instance, he advocated for taxing gasoline “much more heavily,” took a swipe at Mayor Bloomberg’s transportation policy and pledged that plans for East River bridge tolls would come back again.

He looks at politics as an idealist, a good-government type who believes— despite all evidence to the contrary—that rational policy is within reach, and he deeply respects the value of public service.

It is a belief shaped decades ago, when the involvement of business leaders became a hallmark of New York City’s aversion to bankruptcy in the 1970s. Well-known civic giants like landlord Lew Rudin and banker Felix Rohatyn, along with labor leaders, became heavily involved in discussions about the city’s fiscal picture. Ultimately, Mr. Rudin and other big-name landlords volunteered to prepay hundreds of millions of dollars in property taxes to help bail out the city.

“Dick believes very much in civic engagement, and he thinks to get any major reform actually accomplished in the New York political framework, you need a broad base of understanding and support from business, labor and the major groups,” said Peter Goldmark, a former state budget director in the fiscal crisis. The challenge for Mr. Ravitch is that his notions of we’re-all-in-this-together New York politics are antiquated—forged in a different era. The New York in which high-profile elites stand up as prominent civic participants is no more. The city’s banks and other industries are far more global in their reach than before, less grounded in New York. Further, the dysfunction of Albany is widely believed to be at an all-time high, as the Legislature goes through excruciating pain to pass anything even remotely controversial.

Perhaps the template for Mr. Ravitch’s vision of civic engagement, and the challenges that come with it today, is the commission he led in 2008 to bring new revenue streams to the M.T.A. Mr. Ravitch brought in a collection of business and other leaders—Denis Hughes of New York’s AFL-CIO, the chairman of Con Edison, Kevin Burke, to name a few—with the hope of agreeing on a workable plan that would go through the Legislature without tremendous opposition.

But the plan, which called for bridge tolls along the East River and a new payroll tax, got stuck in the mud of state politics, and was delayed for months amid wrangling in the State Senate. Ultimately, after months of fighting in the Senate, a pared-back version of the plan was passed, giving the M.T.A. enough money for two of the five years it sought (revenues have since fallen short of projections).
“He ended up not really fixing the operating- or the capital-budget problems that the M.T.A. faces,” said Bob Yaro, president of the Regional Plan Association. “But are we much better off than we would have been? Absolutely. It gives us close to $2 billion in new revenues”
His latest task, and the one soon to garner attention once it is released this week, is to convince the Legislature and governor to reshape the way the state plans fiscally—to establish long-term stability and order to its checkbook. The situation is indeed dire: There is a $9 billion gap this year, an election year, and larger gaps are projected for next year.

Mr. Ravitch has spent the past few months trying to prepare everyone he can for this next fight—to educate the state’s leaders and legislators about the need for structural reform. Expenses and benefits payments rise faster than revenues, and in a recession that seems bound to linger, that spells catastrophe, with cuts (or new taxes) likely to be needed every year.

He dines with elected officials, meets with labor and business executives to hammer the point home. This week he is unveiling his solution, a five-year fiscal plan that would put in place new controls on its budgeting (the city did this in the 1970s) to keep costs in control.
The plan, according to people familiar with it, would trade short-term borrowing in exchange for long-term controls. This of course will open the door for criticism about continued borrowing and the larger hole it will inevitably create; still, it is hard to see how the paralyzed Legislature, particularly the State Senate, could find agreement anytime soon on how to fill the $9 billion gap.

Just how much influence Mr. Ravitch will have in the coming months depends in large part on Mr. Paterson, and to what extent he is willing to unleash Mr. Ravitch. Thus far, Mr. Paterson seems to have left him in a policy role akin to the well-respected leader of a think tank—allowing him to work on budget issues, but not giving him the tools to implement changes. In terms of budget discussions, his role is unclear.

For instance, when Mr. Ravitch was looking to meet with an organization affected by the state budget earlier this year, the governor’s office called the organization to give a disclaimer. “They said, ‘If you’re going to meet with Dick Ravitch, he does not speak for us,’” an organization official who discussed the issue with the governor’s office said. (In a statement for this article, Marissa Shorenstein, a spokeswoman for the governor, said thatMr. Paterson “appreciates Lieutenant Governor Ravitch’s diligent work preparing a plan to help our state government achieve long-term structural budget balance. His proposals deserve due consideration as we move forward toward the final Enacted Budget.” Mr. Ravitch declined to be interviewed, as his fiscal plan was being finalized.)

While some lawmakers, including Sheldon Silver, the Assembly speaker, have called for Mr. Ravitch to take the lead in budget negotiations, others, including State Senators Eric Adams and Carl Kruger, have balked at the concept.

It is the Senate that poses Mr. Ravitch’s greatest challenge, as the chamber, with a slim and poorly unified Democratic majority, has been a ground zero of deadlock on any difficult vote in the past year. With a few influential senators denying the large size of deficits and pushing a do-it-next-year mentality, the prevailing attitude in the chamber is at odds with Mr. Ravitch.

This, he has said, leaves him conflicted. “I’m actually a great believer in Bill Buckley’s view that I’d rather be governed by the first hundred names in the Boston phone book than all the professors at Harvard,” he told a forum at N.Y.U. in October. “I nonetheless think it could be argued that the Senate has extended that principle a little beyond reasonableness. And I can only say that if you believe in democracy, my job is to work with them and to try to persuade them, and I have not given up yet.”

ebrown@observer.com

More from Eliot Brown: Ravitch Offers Albany a Trade: New Budget Limits for Less Pain this Year >

Michael Bloomberg and Kathy Wylde, head of the Partnership for NYC, are out with statements criticizing the City Council for blocking the Kingsbridge Armory plans, saying a requirement to pay workers "living wages" has cost the city valuable jobs.

The "outcome and timing couldn’t be worse," Bloomberg said in a public statement, referring the recession. "[M]andatory wage requirements" would "make the project unviable, and that was a line we were never going to cross. It’s not the role of the public sector."

Wylde's statement put the vote in the context of a debate "over how far local government can go in determining compensation and benefits offered by private employers." 

"This is the same conversation going on over imposing paid sick leave requirements," she said.

"What's next, martial law?" Assemblyman Rory Lancman, a Queens Democrat, asked.

Paterson's proposal would, temporarily, give him the power to make spending and revenue decisions to bridge a multi-billion dollar mid-year imbalance. Article VII of the State Constitution describes New York's budget process. The governor has the power to submit an executive budget, but the final authority for spending rests in approval of the legislature. I asked State Senator Neil Breslin, an Albany Democrat and long-practicing attorney, whether this was Constitutional.

"My initial reaction is that I seriously question whether it's constitutional; whether we can abrogate, through legislation, any of our constitutional powers," Breslin said lawyerly. "Initially, that's a commitment that I don't think legislators should be eager or quick to give up. We have our own responsibilities and my initial reaction is that I would be opposed to that."

"Not only that, but it violates several hundred years of American history," added Professor Gerald Benjamin, an expert on New York government who teaches at SUNY New Paltz. "Let me remind you: the American Revolution occurred on a number of issues, one of which was called taxation without representation. And the location of fiscal authority in the legislature was a fundamental tenet of representative government, and we have given the power to tax and the power to spend to legislative bodies."

He added, specifically referencing the State Senate: "the fact that somebody's irresponsible doesn't take away the fundamental point that that institution should do what it is supposed to do."

Kathy Wylde, the president of the Partnership for New York City, applauded the fact that Paterson was trying something.

"Governor Paterson's willingness to take the heat for making the budget cuts that are required to save New York State's credit rating is a demonstration of political courage unlike any we have seen in Albany for some time," she said. "The business community fully supports his request that the Legislature authorize the Governor to act on behalf of the public interest to forestall a deeper fiscal crisis and urges quick passage of the authorizing legislation."

The mayor whose wagon she hitched her fortunes to spent $100 million to win reelection by less than 5 points against a member of her own party whom she endorsed late and with undisguised indifference. Four incumbent council members she backed were ousted in primaries by labor-backed candidates who don’t owe her anything, except maybe payback. And with increasingly difficult choices to be made about how to allot a shrinking amount of public resources, Ms. Quinn will increasingly be placed in no-win situations pitting one instituational ally against another.

For example, two sources of Ms. Quinn’s strength—organized labor and the city’s business leaders—are in a heated fight over legislation to require businesses to provide paid sick days to workers. (Ms. Quinn said he hasn’t taken a position yet, but says she is meeting with supporters and opponents personally.)

“The city's business community does not perceive Christine Quinn as being in the pocket of Mayor Bloomberg but rather as a forceful and independent politician with whom they deal on her own terms,” said Kathy Wylde, president and CEO of the Partnership for New York City. “She can’t just continue to stay in the shadow of the Mayor, whose efforts attract more public attention. This will be the time when she cuts her own deals and makes her own way, because she’s the only one who can manage issues like paid leave in the Council.”

Ms. Wylde said Ms. Quinn has established her reputation and credibility with the business community by quietly steering a course down the middle and working with Mayor Bloomberg. The question is whether Ms. Quinn “can now steer a course that makes her independence of Bloomberg obvious to the public.“

Inside her City Hall office, Ms. Quinn was as close to a picture of calm as a 43-year-old acknowledged micromanager can get. She was nursing a large Dunkin Donuts coffee and wearing no makeup. She said that her ears were still ringing from a Bruce Springsteen concert she’d gone to the night before.

Nothing about her will change, she said, and she didn’t feel as if her speakership was in any particular danger (notwithstanding a spirited declaration of intent by former Black Panther Charles Barron).

“Look, people have been talking about challengers for quite some time,” she said. “I see no challenger. You keep talking and talking when you don’t have anything. If people have something, they put it up. People are just talking. Talk is cheap.”

She said that the lesson from last week’s election was simple, and not particularly troubling to her. “People are extremely worried and concerned about the kind of overall state of affairs,” she said.

She was unapologetic about her closeness to Mr. Bloomberg, and dismissed the idea of reassessing the benefits of the partnership with the mayor now.

“Beneficial to whom?” she asked, her voice echoing in her office. “Beneficial to what? I mean, my job is to get things done that will make New Yorkers’ lives better and easier. So the only cost-benefit analysis for me is what helps me and my colleagues implement policies, pass legislation, pass budgets that make people’s lives better. That’s what I have to do.”

“Go back in time,” she said. “Early on in Gifford [Miller]’s term as speaker, the mayor proposed closing firehouses. There were lots of rallies, there were arrests, there was screaming, there was yelling. And fire. Houses. Closed,” she said.

(She noted, quickly, that a similar proposal to close firehouses under her watch was blocked.)

She said she would accept the perspective that comes with the “fresh eyes” that the new members will bring to the Council. “God knows we are at a time when we will take every new solution that we can get,” she said.

Two of her former colleagues, Bill de Blasio and John Liu, have now won election to citywide office as public advocate and comptroller, respectively, and both promise to take a more aggressive posture toward the Bloomberg administration than that of their predecessors in either office, or, for that matter, Ms. Quinn. She sees this as an opportunity.

Talking about the newly granted power of comptroller-elect John Liu to audit the city’s Department of Education, for example, she said, “I have suggestions for audits I want him to do. One of the challenging things to do is figuring out where there is money. I’m not saying that it’s wasted, nothing like that—but it’s maybe good but not great—not critical. Our job now is to find everything that isn’t critical, that is good but isn’t great. I think everyone accepts, even the Department of Education, that their budget isn’t as transparent as other city agencies’. So being able to have a comptroller assist us in sussing out what isn’t life or death in the lives of schoolteachers and children is going to be very helpful.”

On a number of levels, maybe.

apaybarah@observer.com

"Just working on the budget," he replied.

Ravitch's Constitutional legitimization by a split ruling of the Court of Appeals set him into motion. Paterson had envisioned him as a strong right hand, "an extension of the governor," for budgetary matters and legislative relations, but over the last week Ravitch has, without qualification, taken the lead on creating a budget plan. (The Paterson administration had all of August to develop a concrete plan to reduce the deficit—during which time Ravitch's appointment as lieutenant governor remained in a legal limbo—but could not make any headway.)

As one prominent lobbyist put it: "I'd say he's become the executive director of our government, and Paterson is now kind of like the chairman of the board."

Earlier this week, Ravitch traveled with Paterson to the 17^th floor of the Park Avenue offices of J.P. Morgan Chase for a meeting of bankers, real estate machers and the heads of trade associations from Rochester to Long Island convened by the Partnership for New York City and the Citizens Budget Commission.

Paterson gave a speech that stuck to his increasingly emphatic message of fiscal restraint--which he hopes will be his political redemption. Then he left, with Ravitch staying to sit on a panel and shmooze before the business leaders did break-out sessions. They were excited to see him.

"I think what David was doing was trying to get somebody that has credibility with the Legislature, credibility with business and labor, but who's coming to these conversations without a political agenda," said Kathy Wylde, president of the Partnership for New York. "He has political vulnerability—Ravitch does not. So I think he brought in somebody who's a little larger than life. Governor Paterson is not going to get blamed for whatever Ravitch says or does."

And vice-versa. Ravitch can knock heads and get things done, being the "tough guy" who gives Paterson "deniability," as Wylde put it.

Senate Republican leader Dean Skelos put it to me this way: "I think the lieutenant governor is the person who he felt could come up with a plan based on his expertise in finance, and the fact that he has a certain respectability within the finance community. So we're waiting to see what he comes up with."

So how does Ravitch see himself?

"Well, I don't like to characterize myself under any circumstances—I would leave that to others—but I'm certainly very involved, and the governor is fully aware of what I'm doing and I'm in close touch with him," he said. "Of course, I'm in touch with staffs with the legislative leaders on a continuing basis."

And having spoken to business leaders, next week's agenda holds labor groups. While a traditional Democratic constituency, their relationship with Paterson has been frosty.

"I expect to have an adult conversation with them about the problem and see what ideas they have," Ravitch said. "I've spent a good part of my life with the labor movement, and so I suppose it's possible in some of these situations to characterize me as the bad guy. But I hope they don't, but if they do, I can't prevent people from calling me names. It doesn't change the fact that revenues are going down and the expenses are going up. That's the reality. That's the reality for this governor, for any other governor, and for any member of the legislature. People who are elected to office are the ones who have the burden of having to decide how to resolve these issues. I can be helpful in the process, but it's ultimately elected officials who have to make decisions."

"The press should start asking the people who want to replace them what they should do under similar circumstances," he added, prompting me to ask if he was taking a shot at any person or group who he didn't want to name.

"No, not at all. Not at all," he said. "And I'm sure they all will. It's not a criticism at all. I mean, there's not reason for anybody who doesn't have to make a decision to speak out on it."

Ravitch refused to offer any specifics on what he might propose on behalf of the executive branch or when it might be proposed. Every number shows things are getting worse.

The budget, he told me, is "evolving."

But since, there has been a gradual crescendo of calls for greater intervention by Washington, with property owners and industry groups insisting that a destructive crisis still very much awaits—that is, unless the arms of government come in to cushion the impending blow.

It seems they’re being heard. Top economic officials in the Obama administration have begun to publicly suggest that further action will be needed for the commercial real estate industry.

The push on the subject comes mainly in the form of two separate—but not unrelated—efforts: to mitigate the pain on lenders when the loans for buildings that were traded at absurdly inflated prices come due; and to prevent the plethora of overleveraged apartment buildings from tumbling into disrepair as owners fall behind on debt payments or enter foreclosure.

By the numbers, both issues stand to be highly problematic without—and probably even with—government intervention, particularly for New York City, given that many of the lenders are based here, as are many of the overleveraged buildings. A Deutsche Bank report estimates that at least two-thirds of mortgages in CMBS that mature by 2018—accounting for $410 billion—are unlikely to qualify for a refinancing, risking default. The riskiest are those for buildings traded at the market’s peak, in 2007: Deutsche Bank estimates “well in excess” of 80 percent of the loans from that year are unlikely to qualify. 

And a recent report by the Citizens Housing & Planning Council, a think tank for housing issues, estimated that close to 100,000 apartments in New York City are in multifamily buildings bought with loans that have values greater than the buildings are now worth. This is the case with buildings across the city, from Stuyvesant Town to complexes in the South Bronx, where buyers paid prices far greater than the money from current rents justified, banking on hopes that rents would continue to shoot upward. There is concern that once these loans mature—or sometimes before—building owners will stop spending on maintenance, particularly if there is a lengthy foreclosure process, opening the door for a contagious downward spiral of housing disinvestment that was last seen in 1970s New York.

TO THIS END, VARIOUS business and housing groups are trying to craft palatable responses by the federal government, and are supporting existing legislation that would put federal money toward stabilizing some multifamily properties.

“We saw it coming down the pike as yet, potentially, another emerging problem that Congress was going to end up feeling a lot of pressure from,” said Kathryn Wylde, president of the Partnership for New York City, a group working on the issue that represents banks and large businesses.

“We saw the toxic assets were being treated as if they were pieces of paper or financial obligations,” she added, recognizing that a different response was needed for buildings where people live.

Working with a group of housing advocacy organizations including the Citizens Housing and Planning Council, the Partnership has enlisted the city’s former president of the Housing Development Corporation, Emily Youssouf, to propose some fixes that Washington could apply to address the issue.

Ms. Youssouf, who has been discussing the issue with the New York congressional delegation and federal and state agencies, said her focus has been on offering ways to get toxic apartment building loans refinanced at realistic values. By using and expanding existing programs so more loans on multifamily buildings can qualify for government backing of some sort, she said, banks would have an incentive to write down their holdings to the actual values, rather than keeping the old loans—with their unrealistic values—on their books.

Similarly, those pushing for more government assistance in the broader commercial real estate industry, of which multifamily buildings are a part, are looking to expand TALF and other programs, as without more action, all the forthcoming debt expirations could topple more banks and other lenders.

“This problem is going to keep getting worse,” said Bill Rudin, chairman of the Association for a Better New York and a major New York landlord.

There already seems to be a broader fatigue with putting additional government money at risk to cover private-sector losses, a clear obstacle to anyone pushing for starting new rescue programs.

So why should financial institutions get another round of government intervention—why not let the banks eat the losses? The argument by Mr. Rudin and others who want federal help is that lenders still cannot afford to take such losses, and the economy will be further destabilized as loans default and foreclosures mount over the next three or four years.

“TALF isn’t enough,” he said. “There needs to be other mechanisms to bring back liquidity. There needs to be some broader guarantee, backstop facility.

“If you don’t do this, you’ll waste the hundreds of billions of dollars,” Mr. Rudin said, referring to existing government money that’s been used to try to stabilize the economy.

WITHIN WASHINGTON, THE REAL Estate Roundtable, a trade group, has been pushing to extend TALF to the end of 2010—it recently was extended to March—along with other measures, including tax relief.

Of course, it’s not as though the Obama administration has ignored the issue. TALF was just extended in August, and on Sept. 15, the Internal Revenue Service changed a tax rule involving real estate mortgage investment conduits (REMICs) that makes it easier for some landlords to renegotiate and extend troubled loans.

But in recent weeks, it seems that federal officials have been preparing for more action on commercial real estate. Several top Obama officials publicly sounded alarms about the commercial real estate sector in various public appearances in September, noting that the problem is one that particularly affects smaller and regional lenders, which hold a good amount of the debt.

“It appears to be a problem whose locus is less towards the major, most systemically important financial institutions, and more toward regional and smaller banks,” Larry Summers, a top White House economic adviser, said of commercial real estate problems at a speech at Georgetown in mid-September.

“It is obviously something that is going to require—that has required and is going to … receive attention,” he said.

ebrown@observer.com

"Hopefully we're going to mobilize some constructive responses to the budget crisis," said Kathy Wylde, president of the Partnership for New York City. "We want to be constructively anti-tax."

The Partnership and Citizens Budget Commission organized the forum, which will be held in the offices J.P. Morgan Chase. David Paterson will address the convention, Wylde said, and Lt. Governor Richard Ravitch will stay for panel discussions and break-out sessions.

Paterson will be introduced by Jamie Dimon, the CEO of J.P. Morgan. Others expected to attend the confab are Steve Spinola of REBNY, developer Doug Durst, Kenneth Adams of the Business Council, Brian Sampson from Unshackle Upstate, Carol Kellerman of the CBC and Gristedes owner John Catsimatidis.

The point, Wylde said, is for the business community to present a "strong voice" in the coming budget negotiations.

"The Senate is paralyzed, there is no presiding officer," Paterson said. "I have selected Richard Ravitch, the former chair of the M.T.A. and the Urban Development Corporation."

"He will not be a candidate thereafter," Paterson said. "I have come to seek your support for my unprecedented decision."

Ravitch's selection immediately drew praise.

"He's a congestion buster, definitely," said Neysa Pranger of the Regional Plan Association, who worked with Ravitch to craft a bailout for the authority earlier this year. "Having seen him work firsthand in M.T.A. negotiations, he's forceful and respected and I'm sure he would find a way to forge an agreement. He's been a backroom negotiator his whole life."

Paterson is set to brief civic and business leaders about his choice this evening. Ravitch, 76, has never before been elected to office.

"Dick would be a brilliant appointment," said Kathy Wylde, head of the business group Partnership for New York City. "He has enormous credibility with business and labor. He's famous for reaching across the partisan aisle to solve problems and at this moment in the state political and economic history, I can't think of a better lieutenant governor. He may actually use the position to make a real difference."

Already, Republicans and their allies have vowed a legal challenge to the move. State Senator Dean Skelos requested airtime to respond to the announcement. Paterson has also backed Andrew Cuomo, a political rival, into a corner.

The idea of appointing a lieutenant governor has been given some support by good-government groups, which on Monday said publicly they believe Paterson has the power to make an appointment.

"It's a brilliant appointment that really resonates and hearkens back to an era that we need to re-create," said Susan Lerner, executive director of Common Cause NY. "This is a valid interpretation of the law. There is a gap in the constitution that doesn't clearly provides for succession, and in that case you look at the statute, which does have a clear way to fill a succession."

But Ravitch's appointment will have an unclear affect on the stalemate in the State Senate. As lieutenant governor, he would have the power to cast a tie-breaking vote in the 31-31 tied chamber, but could not establish a quorum.

Negotiations over resolving that dispute are ongoing.

Transportation advocates, business groups and the governor are all taking shots at the Senate majority leader's just-announced plan to address the M.T.A.'s budget shortfall.

Near as I can tell, Wiley Norvell of Transportation Alternatives struck first, via e-mail. "The Senate Democrats' so-called MTA rescue plan is a deferral of responsibility that postpones tough decisions and threatens to make the Authority's financial situation worse," he wrote. "What the City, State and millions of straphangers need are the long-term solutions offered by the Ravitch plan."

A bunch of the reporters who had watched Smith unveil his proposal on the third floor of the Capitol went to catch Assembly Speaker Sheldon Silver, who was speaking at an event on the concourse. He called Smith's plan a "stopgap measure." His own plan includes a lower payroll tax, an eight percent fare increase, and $2 bridge tolls. He was asked if Smith's proposal was a step forward.

"I only consider it...I consider it a step forward in that they have come out and basically said, as we've said, that the termination of the board to cut services and raise fares by 31 percent is unacceptable. That, I consider a step forward. I think it's only a partial step forward in that it doesn't get into place the vision of Dick Ravitch and having a long-term plan in place, one-shot, not having to be revisited six months from now, a year from now, two years from now. We should put this to rest," Silver said.

As Silver addressed the scrum, State Senator Marty Golden walked past. I waved to him with my notebook. He was conveniently lingering for reporters a minute later, smiling, as Silver slapped him lightly on the face and asked him to be nice in his bashing. Golden kept smiling at the first question.

"You've got to be kidding me? Which plan is this now, plan A, B, C, D, E, F, or G?" He began. The smile didn't fade. He said he was involved in forming no plans ("this is supposed to be the week of open government - I've never seen government more closed") and that the Democrats were "punting."

"They're punting for another year," he said. "That's irresponsible for the taxpayers of the City of New York it's irresponsible for the Senate not to be able to come to a conclusion and do their jobs. They are not functioning; they are not doing the jobs the taxpayers sent them here to do."

Walking toward his office, Golden told an aide to make sure John McArdle - the spokesman for the Republican conference - was going to put out similarly strong rhetoric. Golden turned left, and I walked alongside State Senator Pedro Espada Jr. I asked for this thoughts.

"I'm elated," he said. "Today's a great day for Pedro Espada, the M.T.A. ridership and the State Senate."

I asked if I should read anything into him listing his own name before the M.T.A ridership. He slapped me on the back and replied "only that you're very imaginative."

David Paterson gathered with a group of people who have been behind the Ravitch plan, which balanced a payroll tax with a fare increase and bridge tolls, and held a special press conference from his Manhattan office to say he was sticking by it.

"When you have a crisis, you have to address it immediately," he said.

Richard Ravitch was next. "If we don't continue the capital investment," he said, "this system is going to slip back to where it was in the 1970s."

He described his plan as "a balancing of interests" including riders, the business community and others. One of those at the table was Kathy Wylde, president of the Partnership for New York City.

"It is extremely disappointing that the Senate Majority is out today with a last-minute, slapdash plan," she said.

A few others piled on, and then Paterson took questions. He said "we still believe in tolls" and felt the Assembly's plan was solid.

"The problems don't go away," Paterson said. "They have questioned the March 25 deadline for the fare increases, not just for fare increases, but extreme fare increases. Not just service cuts but real things are going to happen."

M.T.A. Chairman Dale Hemmerdinger said that the Senate Democrats didn't correctly do the math would leave the authority "about a billion short."

"They didn't take the time, as best we can tell, to do the math," he said.

"The mathematical methods can be corrected," Paterson jumped in. "They were probably just oversights. We don't want to make a big deal of it."

Paterson is on his way to Albany now, and will meet with Smith because, he said, "maybe we're just misunderstanding each other."

Gene Russianoff of the Straphangers Campaign took the opportunity to seize the microphone and say he was "deeply disappointed" with the Senate plan, saying that capital and operating expenses, fares and tolls are "all different sides of the same Metrocard."

Not exactly a warm reception, but one that's not necessarily unpredictable. I asked Smith about the business community's position on the payroll tax as he unveiled his plan, and he said, "The business community doesn't vote on this plan. We do."

"What we do say to them, is being sensitive to their concerns, that we did drop that down," he added.

I asked State Senator Kevin Parker about the inevitable pressure from Russianoff and other advocates.

"That's fine, pressure bursts pipes," he said. "This conference is built for that."

A few minutes after Paterson's event had ended, Espada called my desk.

"I think the advocates, the governor and all the critics. I ask one question: where is the capital plan?" He asked. It has not yet been introduced; normally the M.T.A. submits a wish list every five years (this year it happens in October), which must be approved by a board consisting of Smith, Silver, Paterson and Michael Bloomberg. So it's a moving target.

"When we don't think and we write these blank checks, we get service that ranks them just above Mr. Madoff in terms of accountability," he said. "This is a new day, and all kudos to Senator Malcolm Smith. He's taken on the permanent government."

-- Additional reporting by Eliot Brown.

Kathy Wylde of the Partnership for New York City and Kenneth Adams of the Business Council just explained that the AFL-CIO has joined them in opposing assessments on health insurance that David Paterson has either proposed or passed in a deficit-reduction program.

"It's the only tax they oppose," Wylde quipped when I talked to her in the hallway after a joint press conference on the issue.

"It's one of those things where we come from different areas to the same place," Adams added.

Here are details of their argument.