Will Eliot Spitzer run for Mayor in 2013?

Eliot Spitzer addresses rumors about a 2013 mayoral run, Andrew Cuomo’s job so far and why he never says never

By Megan Finnegan

(Read other stories about Eliot Spitzer – History is Full of Political Second Acts and Political Pros: Spitzer Mayoral Run is a Fantasy.)

This is the first of a two-part series.

It was three years ago that Eliot Spitzer left the governorship of New York in disgrace, and, for a while, he retreated to the security of private life and did his best to avoid the media glare. Then at the end of 2008, he entered the public arena again, writing for the online magazine Slate, holding forth on themes that got him recognized as attorney general and elected governor—policing Wall Street, reforming education and applying Democratic principles to government. He started appearing on political talk shows, and then CNN gave him his own, pairing Spitzer with Pulitzer Prize-winning journalist Kathleen Parker to spar about current events. Parker recently left the show, and Spitzer helms a new show, In the Arena. For better or worse, he’s not shirking the spotlight any longer.

Many of the characteristics people remember—with varying degrees of fondness and acrimony—dominating his reputation as governor are still present in Spitzer’s public persona; he has a tendency to “steamroll” guests on his show; he sticks forcefully to what he thinks is right; he blames Wall Street misdeeds for much of the financial crisis. When asked about past dalliances with prostitutes, Spitzer is humble and contrite. But it’s clear that he thinks his voice should be heard on matters of policy and government.

Rumors have popped up in political gossip circles that the one-time governor may have his eyes on a run for mayor in 2013. Our Town sat down with Spitzer on a recent weekday morning at the Upper East Side restaurant EAT to get his take on state politics, how local government could function better, what he would do if he were mayor, and if there’s any truth to those rumors swirling around him.

OT: It’s only been about 75 days, but how would you rate Andrew Cuomo’s performance so far?

ES: I’ve tried to avoid commentary. I disagree with him about certain calls. I think his absolutely no millionaire’s tax was, in this moment of crisis, wrong. Just as I thought extending the Bush tax cuts for the wealthy was wrong.

We talk so much about shared sacrifice, and if you look at the pincers of wealth accretion for those at the top over the past 30 years, the genuine deficit crisis that has been created, not just the sort of crisis out of the crisis which is the recession, which is a revenue crisis, but at the long-term structural deficit, we’ve been squeezing government by dropping rates, which would have been fine if the economy had grown.

But when it doesn’t, the question is how are we going to pay for basic things like education, infrastructure, health care. I disagree with him on that.

OT: So you think he’s wrong on health care?

ES: In health care there are two issues. One is how much you spend; the second is how you spend it. The issue of how much to spend at this moment was actually the easier of the two issues, because you knew you had to cut.

But letting the same folks sit around the table determine the allocation means you’re going to perpetuate the status quo. And that’s why, if you think back to what we tried to do with health care, it was very much we have to change the system. And the group that was left out of this was patient voices. We were changing it to say wait a minute; the big hospitals have to change their finance structure. They can’t survive on Medicaid, which is what they’ve been doing for the past 20 years.

OT: Have you been surprised by the continuation of the ethics problems up in Albany?

ES: No.

OT: If the state government capitol was in New York City instead of Albany, would there be less corruption?

ES: Yes. Because there’d be more scrutiny. Somebody did a study one time that said state capitals, which are away from the media center of the state, tend to have a more hermetically sealed environment.

OT: Why hasn’t anyone tried to change that?

ES: It may just be hard to break into it. I don’t know.

OT: Could ethics reform be passed by the legislature?

ES: It will be interesting to see what happens. It’s hard to change some of the subculture that goes on at the community level in terms of legislative entities that then have such a vested interest in their relationships, and it isn’t that they are different than the private sector. These are the sorts of quid pro quos that are difficult and wrong.

OT: Lets talk city politics. The Mayor is in his ninth year. The polls the other day didn’t look good for him—51-percent disapproval. Do you think Bloomberg has been a good mayor? Is he suffering from third-term-itis?

ES: Yes, he’s been a good mayor. Do I agree with every decision he’s made? Of course not. He doesn’t agree with every decision he’s made.

OT: What are the two things you most disagree with?

ES: Let me start with the thing I agree with, because I think that’s more important. The thing I agree with is that he tries new policies.

And the thing in life that we have to be most afraid of is the status quo, because it never wins in the long run. And the status quo is always the path of choice for those who are there. This is inevitable; it’s human nature, that’s how society works. He has been willing, at virtually every turn, to challenge that, and when you do that, some things work really well, some things don’t.

I’ll give you one tiny little example of things that didn’t work well—that little annoying TV in the cabs. Everybody hates it, the moment you get in, boom you turn it off. You can imagine on paper this was a good idea. Everybody hates it. Who could have thunk that?

So some things work, some things don’t. He’s been willing to try new policies. It goes back to Roosevelt. You try it, if it doesn’t work, throw it.

OT: Congestion pricing, football stadium…

ES: Congestion pricing he was right; football stadium he was wrong. So be it.

OT: Do you think he’s been quick enough to throw out things that aren’t working?

ES: No, but none of us are. Because that’s the hardest thing to do. Admitting error is very hard. So he tries. Sometimes he’s been forced, like with the stadium, to throw it out only after it was rejected by the state after a big public fight. As a land use person—someone who’s marginally involved in real estate—I could have told you, that’s an insane place for a stadium. He’s going to say, it hasn’t been developed yet, well it would have been if he’d done it back then.

But the point is you’ve got this piece of property where the value is these unbelievable views across the Hudson. So you develop commercial, you develop parks, you develop residential, retail. You don’t develop a stadium that gets used eight Sundays a year.

OT: Why is he suffering from falling approval ratings?

ES: After nine years we get tired of everybody. Silda has always said—my wife has been very smart about so many things, and one of the things she says is that you notice movie stars, who are successful, do their movie and then disappear for a while. Overexposure. No matter who you are, the public grows tired and looks for a different storyline.

OT: There have been rumors that you’ve been considering running for mayor.

ES: Let me make something clear. Those rumors began in a story by Charlie Gasparino who sourced with Dick Grasso. I don’t know for a fact, but… Dick Grasso is not known to be the person I leak to.

OT: Is there anything to that rumor?

ES: No. I’m doing everything I can to make this TV show a success. And the reason for that is that, first, I’m extraordinarily thankful to CNN for having come to me and said, do you want to do this? It was not a conventional choice for them. It was not an easy choice for them, I can imagine, so I want to make it work. And I enjoy it, and I don’t believe in coming in second, so I’m doing this, I want to make it work.

OT: Is there a scenario you can imagine where you’d jump back into public service?

ES: I’ve been around long enough to know you never rule anything out forever.

But that isn’t meant to suggest I’m doing anything other than thinking about, when I wake up, the 300 emails I’ve gotten overnight from CNN news sources around the world, saying what our lead story is going to be tonight, who do we want as a guest, how do we make this interesting, how do we make this different?

That’s what I want to do and that’s what I’m going to focus on. My kids think it’s cool that I’m on a TV show, so they’re happy, and Silda’s only upset that I get home at nine o’clock because we’re doing a live show. Other than that, she thinks it’s kind of cool and I have weekends off, so what’s not to like?

OT: Do you see yourself doing this for the next five years?

ES: I’ve given up trying to figure out the crystal ball, because it’s just very hard. I know that I want to do it as long as it’s exciting, as long as CNN is happy with the program that we’re putting on the air, as long as the public is saying, we think it is interesting to listen to… I’m enjoying it.

OT: Education is a passion of yours. Could you see yourself getting involved in the education policy arena if the next mayor asked you to be chancellor?

ES: I’d be completely unqualified for that. I spent a lot of time when I was governor thinking about education policy, more as the bank, and by that what I mean is the state is primarily the funder, the Board of Regents obviously is the critical policy voice in education.

But with home rule for the cities and mayoral control, which I deeply believe in, a lot of the day-to-day decisions are made by the chancellor and the mayor.

OT: What do you think has gone well and what has gone badly in terms of education over the past nine years?

ES: I think what has gone well is that, again, it comes back to change. We have begun to challenge orthodoxies; we have begun to focus on measuring outcomes. I know there’s an enormous debate, because when you measure outcomes, you can obviously go too far, because you can teach to the test, and those are real problems.

But we have begun to try to actually measure who teaches well, what techniques work well. It’s like any other business. Accountability creates the incentives, and accountability depends upon measuring outcomes, so we’ve done that.

I believe in charter schools. We doubled the amount of charter schools in my first budget. Not because they’re the magic wand. I think that was the problem with Waiting for ‘Superman,’ as a movie. Great movie, we had him on the show, but let’s not kid ourselves. This isn’t Pollyanna. And when you look at the numbers, 27 percent or whatever outperform, 40-some-odd percent underperform.

But why do I believe in them? It’s competition. I believe in competition. The great danger in education, or in any government service, is monopoly. Monopoly generates lethargy in what you do, so having that competitive spirit there is wonderful.

A couple hundred charter schools in the city let parents see that there’s an alternative, and that forces the education department to do better. And so that has worked well. I think getting in a new breed of teachers, and I don’t say this in any way to diminish older teachers, but getting in new teachers who are genuinely excited, and I think I would raise the pay for teachers significantly. We put the city and the state on the path to spend, in year four or five, $7 billion incrementally on education, and we were going to do it by making the very hard decisions on health care. And if you look at government budgeting, health care is eating our national budget and our state budgets.

OT: Talking about competition in education, what do you think of Last In, First Out (LIFO)? Do you think that needs to go?

ES: Yes. The notion that you retain people based upon seniority in a system where what we have to care about is the quality of the education is wrong.

OT: You’ve got work issues like LIFO, but you’ve also got pension issues that are affecting the city right now. Is pension reform something that can be accomplished?

ES: It sweeps with too broad a brush to say that unions are the problem, and I think right now they’re the scapegoat nationally. What went on in Wisconsin was really wrong. [Wisconsin Governor] Walker was fundamentally wrong.

Unions are like any other group that’s been participating in the policy conversation of the last 30 years, like the real estate industry, like the investment banks, like the leadership of the hospitals. They have tried to protect their universe, change when they’re pushed to change but don’t necessarily put up their hand to say we want to change. Everybody’s like that.

Do we need to rethink long-term exposure to the types of pensions that we put in to our pay systems? Yes, sure we do. Is that the root cause of the financial crisis right now? No. If you look, the percentage of state budgets that is going to pension obligations, it’s quite small.

What’s killing us right now is health care costs. You look at the run up of Medicaid as the percentage of the New York state budget, it’s astronomical. That’s where the money’s going. And so part of that is, yes do we need to rethink, do we want defined-contribution, not defined-benefit plans over long term? Yes, we probably do.

Have the unions been willing to give—the average increase in public sector pay over the last couple of years has been two, three percent a year. They’re not outpacing inflation a whole lot. David Leonhardt had a great article in the Times over whether public sector workers were overpaid or not, overpaid meaning paid more relative to the private sector equivalents. It’s a very ambiguous area. It’s an easy excuse, it’s an easy way to rile up and point the finger, but it’s not the real answer.

OT: Rewinding the tape four years, when you were inaugurated as governer, beside the obvious, what would you do differently now if you could?

ES: I’ve thought about that probably more than I should, in the sense that it’s both healthy and unhealthy to think about it. But I would not necessarily change anything about where we wanted to go.

In fact, I wouldn’t change anything about where we wanted to end up in terms of policies. I would change some of the conversation with the public, because I don’t think the public understood—bizarrely right now, everybody says, get tougher with the legislature.

OT: So it’s a matter of perception?

ES: Well, look, I hate to say that… But keep this in mind. When I was up there, everybody said, do to Albany what you did to Wall Street. Kind of a simplistic take on it, but OK. And what they meant was get tough with these guys to force the changes we want.

We went up there and we tried to do that. And I said, “You guys don’t get it.” The first battle was over the choice of comptroller. And Tom DiNapoli is a fine guy. Like him, he’s a friend.

But I said, “You guys are putting institutional interest over public interest. He’s not the guy who should be running our pension funds.” I had a conversation with Shelly Silver back then, in which I said, “Shelly, if you had your pension here, would you give it to Tom DiNapoli to manage?” He said, “Of course not.” So I said, “Then why would you make him the comptroller?” So I would go back to the public and maybe the legislature and speak to them in a different way, but not be any less demanding… I got criticized after we did our first budget for actually sitting down and talking to them to get compromises. We got a heck of creative steps, $600 million, we changed education policy, changed health care policy. We redid worker’s comp, saving businesses $2 billion by restructuring, all in four months.

OT: What’s important in terms of succeeding Bloomberg?

ES: Here’s what I think the public desperately wants. The public wants to see basic services provided in a way that is responsive to community needs and an educational system that they believe is really making progress, and a belief that beyond Wall Street, there’s going to be an economic driver here.

Now thank goodness for Wall Street—this may sound bizarre coming from me. In terms of the city, but also, I happen to think that the real long-term economic drivers of the city are our universities, and the reason I say that is that the universities draw the kids who then are the talent that Wall Street wants.

What leads to the vitality of downtown isn’t the towers or investment bankers; it’s NYU, it’s Touro College, it’s Columbia, it’s CUNY. That’s why the cities upstate that are doing marginally better are the ones that have colleges downtown.

The biggest mistake New York State made was moving the SUNY campuses out of the downtown areas of our upstate cities. You took University of Buffalo outside, moved it to a suburb, and suddenly Buffalo as a city lost the vitality of kids, the movies, the bars, the theaters, the vitality of people walking on the street.

OT: Can that be remedied?

ES: We were trying. That’s a 20-year project, because you have this infrastructure now. You read a book, The Creative Class, by Richard Florida, or any of these books that talk about urban development—you talk to any kid in the country and say to them, if they’re 18, where do you want to live? It’s New York, Los Angeles—those are the cities. Do many of them say Minneapolis? No. Why? That magnet for human talent is what will keep New York City great. And that’s why every mayor of New York City is a huge fan of immigration.