Sunday, April 25, 2010

Repealing self-dealing

The « Pelican Brief » on Mike Bloomberg's ethics

Ever since I received the latest comment ("Somehow when Mike Bloomberg does something good, he doesn't get any credit. A few minor issues seem to invalidate all the good he does in people's minds.") from an anonymous YouTube profile ("hoochee003"), I've been thinking about how to state in one clear blog post one of the "few minor issues," which highlights how Mayor Michael Bloomberg has breached the social contract, which gives him the right to govern New York City.

John Alan Cohan once wrote that there is a "popular perception that government officials serve their own purposes and those of influential interest groups, rather than those of the public." Further, "the public sees politicians as disconnected from the fundamental principles they ought to be serving." Let's examine the record, to see how Mr. Cohan's statements, although not made about Mayor Bloomberg, can still apply to the shady way that Bloombo Dicto bent the laws to run for a controversial third term as mayor.

In early 2008, Mayor Bloomberg decided to bow out of the race for U.S. President. Because the presidential race proved to be so costly and the public was suffering from Republican fatigue, Mayor Bloomberg, who was already nearing the end of his maximum two terms as mayor of New York City, had to look for another gig. By late 2008, Mayor Bloomberg decided to keep his mayoral title, even though, at the time, it was against the law.

While he was holding a public office, Mayor Bloomberg thought that there was nothing wrong with choosing to change the law with a self-serving result to help him win another, previously-forbidden, election. In addition to striking a deal with the City Council to change the law, as was correctly predicted by artist and political activist Suzannah B. Troy in her prophetic YouTube video, but the Mayor was also able to get his way by striking another deal with a respected private citizen, who had the important role of being a government watchdog.

Within days of having publicly acknowledged or announced his intention to change the laws banning third terms for local politicians, Mayor Bloomberg reached an agreement with civic activist and term limits champion, Ronald Lauder. Mr. Lauder, who had twice underwritten voter referendums that put into place restrictions of two term for local, elected government officials. The pact called for Mr. Lauder to support Mayor Bloomberg's ill-conceived, self-serving term limits extension in exchange for Mayor Bloomberg offering Mr. Lauder an appointment to a city charter revision commission to be formed by Mayor Bloomberg, once Mayor Bloomberg had safely been reëlected to a third term.

Mayor Bloomberg's excuse for needing to run for a third term was that he offered the kind of leadership (aka "fiscal prudence") needed by the city to get through the financial crisis. His strategy involved baiting many term limits' compromised City Councilmembers to vote through a self-dealing extension of term limits; not only would Mayor Bloomberg be eligible to run for a previously-unavailable third term, but so would council members, like Council Speaker Christine Quinn, who were publicly thought of being interested in running for mayor, but who now had to kill 4 more years because they were afraid to publicly challenge the powerful mayor. Since Mayor Bloomberg had decided to bow out of the 2008 presidential race, now everybody else had to put the advancement of their political careers on hold, too.

And if that wasn't enough, midway through the 2009 campaign season, the City Council, which was caught up in a slush fund scandal and had nevertheless passed Mayor Bloomberg's extension of term limits, made its own foray into compromising another important government watchdog : the Office of the Public Advocate. After the Public Advocate publicly criticised the manner in which the City Council and the mayor were changing the term limits law, the City Council proposed a budget, which was accepted by Mayor Bloomberg, which slashed the Public Advocate's budget by an unbelievable 40 per cent. The "job of the Public Advocate is, most fundamentally, that of a watchdog, ensuring that all New Yorkers receive the City services they deserve and have a voice in shaping the policies of their government." (As a matter of fact, the City Council continues to fret anytime the Public Advocate makes mention of the City Council's slush fund scandal.)

After having spent a record amount of money as of November 2009 (over $100 million) to win his ill-fated third term, Mayor Bloomberg only "won by fewer than 5 percent points, at a cost of roughly $20 million for each point," The New York Times reported. Undoubtedly, there was a backlash by the voting public to the cynical method used by Mayor Bloomberg to win reëlection. Fast-forward to March 2010, and Mr. Lauder decided to decline the offer he had accepted in October 2008 (to have served on the karmically-doomed city charter revision commission, which was widely expected to have reset term limits back to two terms). Looks like Mayor Bloomberg was losing the political cover he needed to cloak his machinations and transactions with any shred of credibility.

In social contract theory, it can be said that public servants have a responsibility of respecting a duty of care when carrying out their official tasks. The idea of this theory is that when you first run for public office, you are making an implied promise to give up self-dealing and self-interest for the greater good of society. It's supposed to motivated by a selfless act of wanting to give, not a selfish act of expecting to receive.

In response to hoochee003's request to show cause, the bottom line is that, when we all look back at what hoochee003 may call a "minor issue," we rightly see the manipulative manner in which Mayor Bloomberg fabricated a case to win his third term as mayor of New York City. Mayor Bloomberg essentially and intentionally deceived voters into believing that we needed the business expertise of his billion dollar deal-making in this time of financial crisis so that we could benefit from his personal business acumen. And just like there were no weapons of mass destruction in Iraq to justify its invasion, likewise there is no proof that New York is served better as a result of Mayor Bloomberg's financial expertise to justify the enactment of a self-dealing loophole to the term limits law. Two prime examples come to mind : the bottomless hole in the MTA's deficit and the closing of St. Vincent's Hospital. If it can be said with genuine sincerity that each new announcement of the MTA's budget deficit, which incidentally seems to come far more frequently than the G train, only come as a "surprise" to politicians, then what explains the fact that the Bloomberg administration actually "anticipated" the closing of St. Vincent's Hospital -- yet did nothing about it ? Where has the mayor's financial acumen been on display ? If the financial insolvency of neither a subway system that carries millions of people each day, nor a hospital critical to the care and lives of many thousands of New Yorkers trigger the leadership of such a financial genius that we have in Mayor Bloomberg, then what will ?

Meanwhile, it is difficult not to imagine that Mayor Bloomberg stands to personally gain from clinging onto the mayoral office for four more years, until such time as he could perhaps reconsider running for president in the next election cycle. This has all been a patent violation of public trust, which is, if you will recall, an important underpinning of the social contract we make with one another in a representative democracy. Whereas, in the case of Mayor Bloomberg's third term win, his acts of self-dealing involved misappropriation of opportunities, not money. In contrast to what Mr. Cohan wrote, the "key to reëlection or winning an election" may not necessarily only be "money," but could also include compromising the integrity of government watchdogs, like Mr. Lauder or the Public Advocate.

Now, therefore, if social contract theory calls for selflessness, then we can all agree that that is not how we can describe the political machinations and transactions Bloombo Dicto needed to bring about, in order to to win his third term. He used his position of power and influence over the City Council and government watchdogs.

Sometimes, I wonder whether if it can be shown that a self-dealing politician can be considered a fiduciary, whose powers of the purse make him accountable to a higher standard of ethics and professionalism, then would it constitute a breach of the fiduciary responsibility or relationship for that self-dealing politician to have engaged in machinations or transactions that benefited himself ? Could a courageous citizen come forth and make a showing that they were harmed by the self-dealing changes in term limits or the decimation of the Public Advocate's budget ? Could such a cause be able to recover the citizen's loss of property or rights, as well as disgorge the politician's wrongful profits or winnings ?
What kinds of profits or winnings can a wealthy mayor pocket if all he earns is $1 per year ? The perks that come with being a top government official can actually save a billionaire a lot of money. The high level of security that an otherwise wealthy private citizen would have to pay can be substantial. But if you also happen to be wealthy and mayor of New York City, you can make out very well by receiving security in form of NYPD escorts at your discretion. A wealthy citizen, who just so happens to also be mayor, can put many of his campaign workers onto the city's payrolls, in order to transfer the expenses of their employment from one's pocketbook to the city's treasury. Furthermore, a wealthy politician can also appoint city employees to represent his various private charitable efforts, which also serves to help one save money and perpetuate his power over important city cultural institutions. Still further yet, a politician can also save money on publicity, like asking the city to create or broadcast video footage of one's numerous vanity trips, for the sole purpose of building one's political brand.

For billionaires, whose assets are comprised of or concentrated in one single large investment or business ownership (but who may or may not also be cash poor), finding ways to transfer one's lifestyle expenses can save a billionaire from having to draw down his ownership, or turn to borrowing against his ownership interest, in his flagship enterprise. This is all hypothetically-speaking, mind you, but besides the prestige, there are all of the above financial motivational factors that can inspire a wealthy businessman to become a politician or, at least, encourage him to cling to his political title, even if he deceptively claims he is a selfless public servant. It could take the form of this : pretending to do public service as charity by paying oneself only $1 per year. Do you see how that might work ? Taxpayer money is going to pay for a wealthy person's lifestyle, not to further any service to the public.

Meanwhile, that other government watchdog, the editorial board of The New York Times, which endorsed Bloombo Dicto's third term campaign, suddenly is finding something wrong with the rubber stamp nature of the city charter revision commission. This is the very city charter revision commission, which was supposed to include Mr. Lauder and which was born out of a deal to let Bloombo Dicto keep his office until the next presidential campaign. Why should it come to anyone's surprise that nothing good can ever come out of such ill-fated, karmically-doomed self-dealing ? How can a reasonable person have any altruistic expectation from a compromised city charter revision commission that was created with no regard to public trust ?


  1. The New York Times reported today that Mayor Bloomberg uses city-paid NYPD officers to provide security for him on his tropical Bermuda estate, during his weekend vacations.

  2. Charitable Mike aide
    Posted: 2:34 AM, April 1, 2010

    Without seeking a new ethics opinion, Mayor Bloomberg yesterday named First Deputy Mayor Patricia Harris as CEO and chairwoman of his $1.6 billion family foundation while she continues in her role at City Hall.

    Harris had been serving as president of the Bloomberg Family Foundation, which yesterday was expanded to include 19 board members.

    In January 2008, the city's Conflicts of Interest Board ruled that Harris and another mayoral aide, Allison Jaffin, could work for the foundation on a voluntary and unpaid basis and make "incidental use" of city resources, such as phones and Internet services.

    Jason Post, a mayoral spokesman, said the board had been told Harris' title was being changed and "they said OK. We didn't seek another opinion because we already had one."

    Dick Dadey, executive director of Citizens Union, recommended that Harris ask for a new ethics ruling.

    "The different title is splitting hairs," he said. "But it's always wise to err on the side of caution and get a new opinion given the expanded governance of the new board."

    Copied entirely from The New York Post. Copyright 2010 NYP Holdings, Inc. All rights reserved.


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