Jewish World Review Jan. 10, 2002/ 26 Teves 5762

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Consumer Reports

Mayor Mike's mess?


http://www.NewsAndOpinion.com -- A LONGTIME Buddy--from the Baltimore days, back when Anna Quindlen and I were young--insists that the new year never really begins until Jan. 20, which happens to be his birthday. Characteristic narcissism aside, he's correct. Holiday hangovers and hangers-on don't disappear on the month's second day; business offices are half-populated; and much of the media is wrapping up Top 10/What's In, What's Out? lists from the previous year. Throw in all the damn football games and it makes for a dull fortnight.

Here in New York City, as "Mayor Mike"--a more contrived nickname I can't recall--assembles his City Hall squad, we're in the eye of a national recession, although it doesn't seem quite as bleak as one might've predicted last October. The real estate market, while struggling, isn't yet in freefall, and barring another terrorist attack--say a suitcase bomb at rush hour in Grand Central station--I'm not sure it'll dip much lower. There are fewer "For Rent" signs posted on storefronts than expected, restaurant tables are filled even in Lower Manhattan and a thin & trim NASDAQ is on a roll.

I've spotted groups of tourists in the city, and not just at Ground Zero: Several days ago, two of my nieces were in town and so seven of us zipped up to Times Square and waited half an hour to gain entrance into Madame Tussaud's. I'd never considered shelling out $20/per for this particular attraction, but it was actually a lot of fun. Not all the celebrity stiffs bear a convincing resemblance to the real people--the Beatles and Donald Trump, for example, are way off the mark--but as I was hurtled about in the crowd, I brushed the coat of a woman, said, "Excuse me, madam," and it turned out to be a lifeless Barbara Walters. I was gratified that Bill Clinton didn't make the cut in the political section--although the dear, departed Buddy is sure to be the museum's next inductee--and was mesmerized for some reason looking at Richard Nixon with a poster of Barry Manilow in the near-distance.

THAT WAS THE GOOD NEWS

So that's the semi-bullish view on the city's fiscal fortunes. My friend John Ellis, writing in January's Fast Company, presents a far more dire scenario, one that's filled with numbers instead of impressionistic observations. Ellis' lead time for his column precluded knowing whether Mark Green or Mayor Mike would succeed Rudy Giuliani, and perhaps his remarks might've been less harsh if he'd known the result, but if you're a New Yorker don't read the following on a full stomach.

He writes: "The fact is, the city is in for a very bad run. New York is estimated to be $4 billion in the red as of this writing--and that amount is likely to rise to $6 billion. As the city's fear-driven economy continues its slide and as tax receipts consequently fall, the current $4 billion shortfall will probably double in 6 to 12 months... The 'solution' will be higher taxes. The commuter tax, repealed three years ago, will be reinstated. The sales tax will be hiked. Various usage fees will increase. And all of that--and more--will not be enough to cover the shortfall."

Ellis then predicts a crippling migration of the finance and news industries to the suburbs. "In the 1950s and 1960s, white flight from 'inner cities' transformed the American landscape. In this decade, byteflight, fueled by fears of terrorism, will do the same. And nowhere will this occur faster than in New York. This is the truest thing I can tell you: All of those commuters who ride trains, subways, and buses, and who drive their cars into Manhattan, don't want to do it anymore. If it were possible, they would work anywhere but there."

While Ellis does conclude his piece with a vision of New York's eventual renaissance, because "the people who choose to live there will simply refuse to give up or give in," his clear message is that the city is in for a very rough patch, starting yesterday.

Could be, and even though Bloomberg has pledged no new taxes, I doubt that his conviction is as sincere as President Bush's, who last Saturday upped the political ante and said a rise in taxes would happen only over his "dead body."

Still, I think Ellis is missing a crucial point: It's true that people of his age and mine (mid-40s) are sick of commuting or of the high cost of living in New York, but we're not the workers who matter. Sure, it's the executives who make the decisions whether to relocate their brokerage firms or magazines, say, to Short Hills or Litchfield, but what bright young man or woman, looking to make a fortune on Wall Street or start a career in journalism, will be content to live in a suburb? The next generation of managers and CEOs wants to have fun as well as work 16-hour days. Last time I visited, Morristown, NJ, wasn't exactly a swinging town.


JWR contributor "Mugger" -- aka Russ Smith -- is the editor-in-chief and CEO of New York Press (www.nypress.com). Send your comments to him by clicking here.

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© 2002, Russ Smith