Fearing a Return to the Bad Old Days

The Partnership for New York City, a business and civic organization, recently published an important analysis of the city’s economy with a special emphasis on job creation. Amid the charts, number crunching and projections, one carefully constructed sentence stood out: “As the Bloomberg mayoralty ends, there is concern in the business community that the next Mayor will tip in the direction of one policy extreme, toward a more intrusive, higher cost government without an offsetting commitment to quality of life and pro-growth policies.”

Translation: the city’s business community is afraid. Very afraid. And why wouldn’t it be? After 20 years of data-driven, businesslike government, there’s a good chance that New York is about to return to the bad old days of ideological pandering, anti-growth budgeting and job-killing regulation.

The Partnership is not alone in its fears. Another group of business leaders has formed a new political action committee called Jobs for New York, which intends to raise money to influence key City Council races later this year. The Council’s influence over city government may be limited, but its members do wield extraordinary power over land use and economic development decisions in their districts.

New Yorkers ought to pay attention to the retrograde rhetoric of some of Mr. Bloomberg’s would-be successors. If they do, they’ll understand why groups like the Partnership and the Jobs for New York PAC are so concerned. Some candidates sound as though they’re running for union boss or community board chairman, not for the highest elective office in a city of more than eight million people.

The Partnership’s report, titled “NYC Jobs Blueprint,” makes it clear just how fragile the Giuliani-Bloomberg legacy may be, at least on economic issues. Even after 20 years of pro-growth policies, the cost of doing business in New York remains the highest in the country, far higher than in Chicago, Los Angeles or even the New Jersey Turnpike corridor from Newark to Trenton. The number of middle-income households has continued to decline, from about 940,000 in 2000 to about 870,000 in 2010 (the last year for which data is available). The city’s private economy will need to create more than 100,000 middle-wage jobs per year over the next seven years simply to return to 2008 levels.

In other words, the next mayor will need to do more than simply consolidate the changes of the last 20 years. He or she must be able to use the Giuliani-Bloomberg legacy as a starting point for the city’s transformation to a 21st-century economy.

The cultural, political and social obstacles are formidable. That’s why Jobs for New York is looking to plow PAC money into City Council races, because the group’s leaders know that council members can hold up economic development projects on an ideological whim.

Entrenched interests seem convinced that the next four years will be payback for the last two decades, and they will be able to turn back the clock to a vanished time in the city’s political and economic history. The Partnership’s report on job creation notes that the proposed rezoning of the Garment District has stalled because “advocates of traditional manufacturing” are absolutely intent on “hanging on to jobs that no longer make sense in the city.” As a result, the district may miss out on the sort of dynamism that has transformed the Brooklyn Navy Yard and the Greenpoint Manufacturing and Design Center into hothouses of 21st-century job creation.

Ironically, and sadly, many of the jobs that will be created over the next seven years will require skills that New York’s young people simply don’t have, even after 12 years of school reform. The city projects that 284,000 new jobs over the next decade will require a bachelor’s degree and another 201,000 will require an associate’s degree. But, the Partnership warns, city employers “in high-growth sectors are increasingly experiencing a shortage of qualified candidates for available jobs.”

That means the city must press forward with creative and effective education reforms, from kindergarten to the City University of New York. But that won’t happen as long as would-be mayors tremble before the supposed political power of the city’s teacher’s unions.

The last 20 years have not been without conflict between City Hall and the private sector. Property owners have gripes about taxes; the city’s income tax is too dependent on the top 10 percent of earners.

For the most part, however, the city—every sector of the city—has enjoyed an extraordinary and prosperous collaboration between the public and private sectors. In 1993, the city seemed resigned to decline, ungovernable. Twenty years later, New York is ascendant.

But there are no guarantees moving forward. Legacies can be destroyed in a matter of months. Reforms can be undone with an ill-advised contract, a political deal, a crushing regulation.

The city’s wealth-creating private sector has every reason to be concerned about life after 2013.

Fearing a Return to the Bad Old Days