The mayor unveiled his last budget the other day, and if he took a little extra time to sing the praises of his administration, well, fair enough. Mr. Bloomberg has presided over two very difficult recessions—the post-9/11 crash and the even more serious recession that began in 2008. He has managed to navigate bad times without resorting to dramatic service cuts or sharp tax increases—no small accomplishment.

The $70 billion budget keeps city spending flat, but many New Yorkers are rightfully anxious about a return to budgeting as usual after the mayor leaves office. Public Advocate Bill de Blasio complained that the mayor isn’t spending enough on early education, which Mr. de Blasio wishes to fund by raising taxes on high earners. City Comptroller John Liu referred to the proposal as a “holding-pattern budget.”

As usual, there will be weeks of give and take between the mayor’s office and the City Council over what amounts to a very small portion of overall city spending. The Council will very likely restore funds to prevent the closing of 20 firehouses and the elimination of thousands of day care openings. In the end, however, the budget will look very much like the one the mayor outlined as part of his yearlong farewell tour the other day.

At this time next year, a new mayor will present his or her first-ever budget. Only then will we know if 20 years of accountability and efficiency truly have taken root in City Hall.

It is springtime—hope springs eternal.

Katie Holmes and Mayor Michael Bloomberg at The New York Observer's 25th anniversary party.

Last Thursday evening at New York’s perch of power dining, the Four Seasons Restaurant, billionaires could be found clinking glasses with politicians, actors could be seen rubbing shoulders with news correspondents, and throngs of notable wordsmiths quaffed copious amounts of liquor at The New York Observer’s 25th anniversary soiree.

“I think this is the best collection of New Yorkers I’ve seen in 20 years!” effused Ronald Perelman, who leered lustily at our highball glass.

“Can I ask you one question?” he continued. “Where’s the bar?”

It’s thataway, just behind Katie Couric, we assured the business tycoon. Or if he preferred, he could hit the bar on the other side of the restaurant’s famous pool room, where Harvey Weinstein had posted up and Spike Lee, who declined to take off his puffy coat, had helped himself to the generous spread of gourmet goodies before chatting up Katie Holmes and Donald Trump.

(Sadly, Shindigger caught only the tail end of that conversation. Mr. Lee saying to Mr. Trump: “Well, that’s one thing we can agree on.”)

Observer editors past and present—Peter Kaplan, Elizabeth Spiers and Ken Kurson—circled the room, while publisher Jared Kushner greeted guests with wife Ivanka Trump at the door. And from the worlds of business, politics, entertainment, fashion and beyond, the stars just kept pouring in. Even Mayor Michael Bloomberg was impressed with the turnout. “The Observer does throw a hell of a party,” he said in his opening remarks, before dubbing attendee Cory Booker “the handsomest mayor in America—west of the Hudson River.”

Here came Terry McDonell and Danny Strong and Jay McInerney and Audrey Gelman and Larry Gagosian and Ray Kelly and Joel Klein and George Pataki and Eric Schmidt and Kevin Ryan and—oh my!—Rupert Murdoch.

We just had to talk to Rupert Murdoch

“Mr. Murdoch? Mr. Murdoch?” Shindigger beckoned.

“What?” said the cantankerous billionaire, walking right on by with wife Wendi Murdoch.

“Can we ask you a few questions, sir?”

“No!” barked Mr. Murdoch, before making a dramatic swat in our direction. Shindigger agilely ducked for safety, silently chuckling at the news baron’s aversion to the press.

In no time at all, we found friendlier prey. “Someone from The Observer already observed me,” said Broadway favorite Christine Baranski, who was chatting with fashion consultant Fern Mallis under the floral protection of one of the poolside trees.

“New York is just the coolest city, and I love the fact that this paper really makes New York seem cool,” Ms. Baranski said. “The Observer touches on the sophistication and fun of the city. I just like the tone of it.”

Just then, we re-encountered Mr. Perelman, who had been paired with a cocktail, and who had his own take on The Observer. “The only bad moment I ever had was when they wrote a story about a little synagogue,” Mr. Perelman said, referring to Chloé Malle’s prickly 2010 article about the billionaire’s lavish private synagogue.

“I wish they didn’t, but they did, so that’s the end of it,” he said. “I still love The Observer, even besides that.”

Very gracious, we thought, bumping then into Observer alum George Gurley, with whom we had pre-gamed earlier in the evening at Jean and Martin Shafiroff’s glitzy Saint Patrick’s Day cocktail party. The suavely fuddled Mr. Gurley made the perfect VIP-fixer for Shindigger when PR maven Peggy Siegal was hand-holding elsewhere.

“He does Shindigger, he’s trustworthy,” Mr. Gurley assured José “Pepe” Fanjul, the president of Fanjul Corp. and Florida Crystals Corporation.

“I think this is the best event!” exclaimed Mr. Fanjul’s Carolina Herrera-clad wife, Emilia Fanjul.

We danced past the couple then to catch up with model Hilary Rhoda, who was getting a kick out of the bash.

“Oh, it’s a great party!” she said, holding a plate of Christian Albin’s Italian gourmet cibo. “I love the room, it’s gorgeous. I love the band. Obviously getting into the food situation.”

Ms. Rhoda, also dressed in a Carolina Herrera creation, had just returned from the runways of Paris, where she had walked for Céline. “Now I’m back and on photo shoots,” she said.

Photorealistic artist Chuck Close was also taking advantage of the buffet.

“I love The Observer almost in spite of myself,” he said. “At first it was a guilty pleasure, and then one day they endorsed Mitt Romney. I almost canceled my subscription. What were they thinking?”

What brought you back onboard, we wondered?

“When I go to Europe and can’t read you, I get really upset,” he confessed. “It went from being a guilty pleasure to a real pleasure.”

A cocktail later, we found ourselves yelling: “Ms. Herrera, we saw you at the School of American Ballet’s Winter Ball, and you were dancing!”

Shindigger had never witnessed her quite so zippy.

“Yes, I know. I’m South American,” Carolina Herrera retorted sassily.

Cuchi-Cuchi!

Back to the bar we traipsed.

“Do you have a white wine or champagne?” Padma Lakshmi pressed a barman.

“Rosé or brut?” he asked.

“Brut,” the foodie stated assuredly.

Ms. Lakshmi wanted to know our thoughts about her Blossom Ball. “Did you have fun?” she asked.

“We did, “Shindigger said.

“I’m glad!” she said. And then the Maison Martin Margiela-wearing TV host told us about the previous day, which she had spent in Albany: “I was recognized by the State Senate. Every State senator was there, because it’s budget time,” she dished, lowering her voice to a serious, husky tone. Though she lost us at “budget.”

When the band was replaced by DJ Chelsea Leyland’s turntables, things had officially strayed, and Shindigger was impressed (and a tad disappointed) that not a single sloshed attendee plummeted into the white marble pool. Cases in point: when perpetually grabby Four Seasons proprietor Julian Niccolini began frisking two attractive slabs of meat, offering to shower them with pricey pours of Bordeaux. Or when Gawker founder Nick Denton resorted to flirting with a pride of hungry tech lionesses, having already refused to be photographed with Mr. Murdoch because “it’s too obvious.”

Shindigger sidled up to the bar for last call with Ashleigh Banfield of CNN and Fox News’s Kimberly Guilfoyle.

“We’re together,” Ms. Banfield joked about their warring media outlets. “I’ve known her for eight years. We use to work at Court TV together.”

“Did you see Rupert Murdoch? He didn’t want to talk to us,” we bemoaned.

“Because I work at CNN, he didn’t want to talk to me, either,” said Ms. Banfield.

“No, he’s great! God bless him!” Ms. Guilfoyle cut in, right on cue.

As Rihanna’s “Diamonds” thundered over the speakers, Ms. Banfield revealed that she had gotten a smooch from the Newark mayor.

“We had a Cory Booker sandwich,” swooned Ms. Guilfoyle.

As things were wrapping up, at least one guest took on a reflective air. Mr. Close told us that he was overwhelmed by the turnout and notable faces. “I’ll make sure to be at the 50th anniversary,” he promised. “I’ll be 98.”

Shindigger likes a man who can forecast that far ahead—or, for that matter, with any type of math skills.

Here’s to the next 25 years!

Jared Kushner, Katie Holmes and Mike Bloomberg (PMc)

- The intimidatingly assiduous Peggy Siegal greets people at the door; thanks us for coming to celebrate party with The New York Observer. "We are The New York Observer!" We cry. She doesn't even pause. "Well, it's great to see you anyway."

-Terry McDonell: I've always loved the Observer, I have great respect for Peter Kaplan. The coverage of everything I was interested in New York in the past 25 years was reflected in The Observer at the highest level.

- Ray Kelly recalls the last time he was at the Four Seasons. "[We] feel like you never leave," we tell the Police Commissioner. His reply: "A lot of people feel that way."

- Spike Lee keeps on puffy coat all evening, talks to Katie Holmes, Donald Trump. Catch tail end of his conversation with Mr. Trump: "Well, that's one thing we agree on."

- Mayor Bloomberg gets onstage, proceeds to riff about slipping Harvey Weinstein a script (Bloomie on Bloomie), Cory Booker ("The handsomest mayor West of the Hudson") and The Observer ("It's OK when you needle somebody else, but not me.")

- Michael Shannon confounds half the party with his celebrity status. "What famous person is that?" we are asked more than several times. We finally after give up and refer them to Boardwalk Empire after several of our "the Future General Zod" joke receives blank stares.

- Nick Denton refuses to take photo with Rupert Murdoch because it's "too obvious."

-Chuck Close: I love the Observer almost in spite of myself. At first it was a guilty pleasure. When I go to Europe and can't read you, I get really upset.

- Mayor Cory Booker meets Manhattan Borough President Scott Stringer’s press secretary/Girls actress Audrey Gelman. Mr. Booker finds a way to bring the conversation back around to Star Trek.

- Game Change’s Emmy-winning screenwriter Danny Strong still getting recognized for his years on the TV show Buffy the Vampire Slayer. But he's a good sport, and challenges fanboy to name the one episode of the hit show that was nominated for an Emmy. (Answer: "Hush.")

-Former editor Peter Kaplan begs off with the excuse that he is trying to wean himself off of anti-anxiety medication.

-Ronald Perelman: I love the publication! I think everybody here is great. I think this is the best collection of New Yorkers I've seen in 20 years!

- Jay McInerney inquires about the after-party; never shows up.

A marathon runs through it. (Ed Reed/Mayor's Office)

Mayor Bloomberg has gotten his fair share of criticism for deciding to go ahead with the annual New York City Marathon, given the devastation throughout the city following Hurricane Sandy, including not far from the starting line in Staten Island. But the mayor is sticking to his previous promise to have the race run, to send a message of New York's recovery and to help buoy an economy that has been battered by the storm.

"As Rudy Giuliani said to me this morning, he said, 'You know, right after 9/11 people said the same thing,'" Mayor Bloomberg said. Being Mike Bloomberg, he then launched into an economic defense for his decision. "New York has to show that we’re here, we are going to recover, and that while we help people we can still help companies that need the business, still generate the tax base so that we have the resources to help people. We can give people something to cheer about in what’s been a very dismal week for some people.”

More than excitement, the mayor seemed to stress this was a matter of hope. "I think Rudy had it right, you have to keep going, and doing things," Mayor Bloomberg said. "You can grieve, you can cry and you can laugh all at the same time. That’s what human beings are good at."

One of the biggest concerns seems to be diverting city resources away from the recovery effort, but Mayor Bloomberg insisted that would not happen.

"It does use some resources, but it doesn’t use resources that can really make a difference in recovery, that sort of thing,' the mayor said. "It’s a different group of people, it’s a relatively small amount of people, it’s the Sanitation Departments resources. And we have to have the city going forward. I don’t think there’s any question there are New Yorkers who have lost loved ones, we can’t replace that, people who have lost their homes, we have to do everything we can to make sure they recover, it’s hard for people to get through this thing, and I can assure you we are doing that. "

Were there any threat to the recovery efforts, the mayor insisted he would not allow the race to continue. "We have plenty of police officers who work in areas that aren’t effected, we don’t take all of them and move them into areas that are effected," the mayor said. "There will be no diversion of resources, there will be no redistribution of our efforts, no diminution of our efforts. We have a 24/7 operation going, which I’m confident we’re gonna do. We have to do everything we can to help people."

The mayor also pointed out that the New York Road Runners, the group that organizes the race, was doing its part, donating $1 million to the city's recovery fund, with an additional $1 million possible from runners, who are being asked to contribute $26.20, an homage to the 26.2-mile length of a typical marathon.

"As Mary Wittenberg, the head of the Road Runners club said, they’re running this race to help New York City, and the donations from all the runners and clubs are going to be a big relief to our relief efforts," the mayor said.

"We are in better shape than most cities for two prime reasons: we've made smart investments in our economy and we budgeted in a responsible way that prepared us for the inevitable downturn in the national economy," Bloomberg said. "But we are not an island. We are not immune to the realities in Albany and Washington. And the reality is, both places are keeping more of our tax dollars to close their own budget deficits. I am sympathetic to their need for budget cuts, but actions taken to close their deficits came without changing the burdens they impose on city taxpayers."

The mayor said that 6,000 teaching positions will be eliminated, and he placed the blame squarely on Andrew Cuomo and the legislature, noting that the state had the largest single year reduction in funding for city education in FY 2012.

"The State continues to disinvest in education in New York City," the mayor said.

The mayor also noted that New York has seemed to recover from the financial collapse of 2008, with business taxes coming in at a higher level than they did pre-crisis. Deficits however are expected to be the norm for the next several years.

Full details from the mayor's office below:

State and Federal Disinvestment in NYC

            The last 10 years have seen the State and Federal governments' share of the City's budget continue to decline.

            In FY 2002, the combined State and Federal share of the City's budget was 36 percent. In FY 2012, the combined State and Federal share of the City's budget will be only 27 percent.

            If the City continued to receive the same percentage of its total budget from State and Federal resources as it did in FY 2002, the City would have received an additional $6.1 billion in State and Federal support FY 2012.

            An additional $6.1 billion of State and Federal resources would have reduced the local tax burden for services or New York City taxpayers by 15 percent, or an additional $6.1 billion in State/Federal resources would have eliminated the need for any of the actions in the 10 rounds of budget saving actions taken since 2008.

State Budget Impact

            Specifically, the State budget for this year alone cut funding to New York City by a total of $1.8 billion that would have flowed through the City's budget. The Executive Budget replaces $1.2 billion of the State cut with City funding.

            The State budget for this year also cut spending on State-provided services in the City - dollars that do not flow though the City's budget - by $2.7 billion.

            Additionally, the State budget cuts triggered a loss of $2.2 billion in Federal matching dollars.

            Those three categories of impact add to a total State budget impact of a $6.8 billion cut for New York City due to the State budget.

Education

            The State budget reduced education funding to the City for FY 2012 by $1.2 billion. This was the largest single-year reduction in education funding to New York City and came at the same time as the City lost $850 million in Federal stimulus dollars used to support teacher salaries.

            To prevent catastrophic personnel losses in the City's school system, the Executive Budget provides a major increase in City funds dedicated to education, with an increase of $2 billion of City funds compared to the prior year.

            The State continues to disinvest in education in New York City. In FY 2002, State and City funding comprised a nearly equal portion of non-Federal spending on education. In FY 2012, City funding will comprise 61 percent of non-Federal spending and State funding will only comprise 39 percent of non-Federal spending.

            If the State had continued to share education costs equally with the City, the State would be providing $2.2 billion more in education funding for FY 2012.

            City-funded spending on education has increased from $5.9 billion in FY 2002 to $13.6 billion in FY 2012.

            Despite the City's continued, strong financial commitment to education, historic State education cuts and the need to balance the budget mean that reductions in the size of the City's teaching force are still required. More than 6,000 teaching positions will be eliminated through attrition and layoffs.

Social Services

            The current State budget eliminated more than $400 million in funding for social services, health and criminal justice, shifting the burden to the City. The Executive Budget uses $121 million of City funds to restore cuts to preserve the most essential services.

            A significant loss of Federal funding and cost increases in the child care system reduced the number of children supported by Administration for Children's Services (ACS) child care program by 16,000 in the Mayor Preliminary Budget. ACS currently provides child care support for 106,000 children, including the 16,000 slots that were slated for elimination in the next fiscal year.

The Mayor's Executive Budget will ensure all children who benefited from child care services this year will be offered a seat in Fiscal Year 2012. The budget will preserve the services by again increasing City funding for ACS child care and funding an expansion of the Department of Youth and Community Development's Out-of-School Time program, with the additional slots created in that program helping to continue service for children currently in ACS child care. Compensating for the reduction in Federal aid and the increased costs to preserve the service for all children in the system will cost $40 million.

The City's Improving Economy

City tax revenues continue to rebound as the City's economy has recovered from the national recession at a faster rate than the rest of the nation.

            Notably, Business Tax revenues - General Corporation, Banking Corporation and Unincorporated Business Taxes - now exceed levels from prior to the financial sector collapse, with Business Taxes in FY 2008 generating $5.41 billion in revenue and a projected $5.75 billion in FY 2012. Business Taxes for FY 2012 are in line with projections from the Preliminary Budget.

Factors contributing to the continued rebound in City tax revenue include:

• Job creation in New York City occurring at a faster rate than the rest of the nation.
• Wall Street profits continuing to exceed expectations.
• A record 48.7 million visitors to New York City in 2010.
• New York City's commercial real estate market remaining the strongest in the U.S.

Capital Spending

            In order to reduce the increasing costs of annual debt service payments, the Executive Budget reduces the City's ten-year capital construction program, excluding water projects, by 10 percent - from $39.8 billion to $36.0 billion.

Headcount

The City's full-time and full-time equivalent headcount currently stands at 295,735, a reduction of 16,069 positions since the start of the Bloomberg Administration. The City's December 31, 2001 full-time and full-time equivalent headcount was 311,804.

Out-Year Gaps

The Mayor also announced today that while the Preliminary Budget for FY 2012 presents a balanced budget, New York City will still face budget gaps of approximately $4.8 billion in FY 2013, $5.1 billion in FY 2014 and $5.3 billion FY 2015.             

"Today, we stand in solidarity with the millions of people around the world who are hoping that Ai Weiwei is quickly and safely released," Mayor Bloomberg said, according to his prepared remarks. "And we stand in solidarity with the billions of people who do not have the most fundamental of all human rights, the most cherished of all American values, and the most valuable of all New York City's riches: free expression."

The decision to deliver the speech comes not without risks for the mayor. His multi-billion dollar business, Bloomberg LP has interests in China, as China has a variety of interests in the city.

The speech had echoes of Mayor Bloomberg's remarks about the Ground Zero Mosque, in which he placed the issue in the sweep of American history. He did the same today, talking about John Peter Zenger, a German immigrant jailed for publishing articles critical of the British colonial government. And he again positioned New York City as a center of First Amendment struggles--and victories.

"New York is a city that fully embodies that spirit and fiercely defends the right of all people to express themselves. Our city is a cacophony of voices - bustling, jarring, provocative. We are a marketplace of ideas, where all are welcome to debate, and argue, and even to agree. For more than 400 years, the best and brightest from around the globe have come here for that reason - and that includes Ai Weiwei."

After a career skirting the lines of authority and freedom of expression in China, Ai was arrested April 3. He had planned to attend the event today. 

The exhibit will be up until July 15.

The talk show host asked Bloomberg about the apparent decision to bring in Cathie Black as city school chief without consulting with aides and experts.

The mayor disputed the premise of the question.

"I did ask a lot of people," he said. "I did talk to a lot of people about whether they would be interested in the job."

The Times reported that Geoffrey Canada had been offered the chancellor's job and turned it down. Mayor Bloomberg has denied this.

The mayor also said that despite his falling poll numbers, he has not regretted seeking a third-term, telling Smiley that he thought it would be too easy to just leave office while the city was soaring.

Finally, the mayor was asked again about Donald Trump's birther talk, and the mayor reiterated that he wished Trump would stop it, and gave a shout-out to a certain salmon-colored weekly.

"He is a New York icon, a little bit bigger than life," the mayor said. "His daughter I know pretty well. She is married to the publisher of a small newspaper here. Very smart."

Watch the full episode. See more Tavis Smiley.

Last year, the mayor testified before Congress along side News Corp. head Rupert Murdoch about reforming the nation's immigration laws, and testily told a judiciary sub-committee "What frustrates the American public...is that we can't understand why you guys complain about immigrants coming over the border illegally and then don't do anything about it." 

Critics have accussed Obama of dragging his feet on immigration reform. Last year he pushed for passage of the DREAM Act, which have provided a pathway to citizenship for children brought to the country illegally, but the measure died in the Senate. He has been relatively silent on the issue since.

Mayor Bloomberg will make remarks at a "Road Safety Meeting" at the World Bank.

The letter marks a study in contrasts to the one sent to Steiner a few months ago, when now former chancellor Cathie Black required a similar waiver.

In Walcott's case, Mayor Bloomberg praises his experience in working with youth and with the city's educational system.

"He has vast experience in and a deep understanding of the many complex issues that fact the Chancellor of New York City Schools, including diverse student populations, fiscal and budgetary matters, construction and facilities management, the importance of school-level decision making and the critical nature of teacher quality and what happens in the classroom," Bloomberg writes. "He is also a skilled communicator who understands the vital need for building relationships within the school system and the communities it serves, as he has been doing for three decades. He is exceptionally qualifed to serve as Chancellor."

Compare and contrast with the letter for Ms. Black:

"Throughout her career, Ms. Black has worked to build strong relationships with colleagues and subordinates, to motivate them to succeed and hold them accountable, and to provide support and expertise where necessary. In addition, as a leader in the field of publishing, Ms. Black has deep experience seeking out the opinions of customers, and incorporating their thoughts and ideas into the organization's work...The challenging issues facing the New York City schools demand a bold thinker who is  not afraid to champion new ideas. Ms. Black is widely recognized as a visionary."

Of course, another difference is that Walcott is likely to be granted a waiver without much of a fight.

Full letters from both below:

Walcott Dennis_Waiver(function() { var scribd = document.createElement("script"); scribd.type = "text/javascript"; scribd.async = true; scribd.src = "http://www.scribd.com/javascripts/embed_code/inject.js"; var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(scribd, s); })();cblack(function() { var scribd = document.createElement("script"); scribd.type = "text/javascript"; scribd.async = true; scribd.src = "http://www.scribd.com/javascripts/embed_code/inject.js"; var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(scribd, s); })(); 

cblackWalcott Dennis_Waiver

"The city is doing a great job as a matter of fact," the mayor shot back to a reporter who asked him about the press conference. "It's a question of how you look at the numbers. It is true that complaints for rats went up something like one and a half percent. It's also true that complaints for everything go up something like five, six, ten percent on 311 because more people start to use it. That doesn't mean the problem is any worse. I think the problem probably is a lot better."

According to the Health Services union, rodent complaints are up by 9 percent.

Stringer, who was joined by City Council member Ydanis Rodriguez, called on the city to restore cuts to the Dept. of Mental Health and Hygiene which led to the termination of 63 pest control workers.

Bloomberg rejected this idea, saying that by properly strategizing the city could properly withstand the cuts. He noted that DMHH is now going after whole neighborhoods rather than individual lots.

"We are doing the right thing and unfortunately some of the elected officials just aren't as informed as I would like them to be," he said "If they realized what we were doing they would be big supporters. We are going to continue doing what we are doing. In the areas where we have focused our efforts I think the number of rats are down like a third, which is amazing progress."

And Bloomberg seemed to have a special message for Stringer about the role of a mayor--a job that the BP covets.

"The job is not to shove as many inspectors out there costing us as much money as you can," Bloomberg said. "The job is to do what the public needs and do it as efficiently as you can. So we are not spending more money to do something, we are spending, I hope, less money and getting better results. That is what you are supposed to do. Anybody can spend more money."