Why is the Mayor risking his first-term successes to build a football stadium?
April 4, 2005
By John Cassidy
Photographs by Mary Ellen Mark
Going back to James (Gentleman Jimmy) Walker, the Jazz Age dandy who spent his evenings at the Central Park Casino and rarely got to work before noon, New Yorkers have tended to elect civic leaders who embody the historic moment. During the Great Depression, Fiorello LaGuardia, the indomitable Little Flower, revived the city's spirit and its economy by building roads, bridges, parks, swimming pools, and affordable housing. Forty years later, when the city was once again skirting bankruptcy, Ed Koch told anybody who would listen that he, for one, wasn't giving up on his home town. And on September 11, 2001, Rudolph Giuliani emerged from a hellish dust cloud to proclaim that New York would recover, and, shortly afterward, to anoint Michael R. Bloomberg as his successor.
Koch turned eighty recently, and Bloomberg threw a cocktail party for him at Gracie Mansion. Bloomberg doesn't live at Grade Mansion - he chose to remain in his East Side town house after being elected - and he isn't a noted speaker, but he gave a warm and generous toast, lauding Koch as a great New Yorker. At six feet one, Koch towered over Bloomberg, who claims to be five feet nine but appears to be closer to five-six. The sight of them together inevitably raised questions about how the current mayor, who is up for reelection in November, will be remembered.
Not long ago, the answer appeared to be "With difficulty." In contrast to Giuliani, whose last months in office encompassed a bitter public divorce, a terrorist attack, and a halfhearted attempt to postpone the mayoral election, Bloomberg went about his job quietly and without fanfare. (One of his early decisions was to tell his drivers to switch off the emergency lights and sit in traffic with everybody else.) Surveys showed that New Yorkers considered him competent and diligent, but, when asked to cite things that he had done which they liked or disliked, many of them struggled to come up with any. (Smokers were an exception. They hadn't forgotten his ban on smoking in bars and restaurants.)
Recently, however, Bloomberg has been acting more like Koch and Giuliani, infuriating some, delighting others, and forcing everybody to pay attention. Last summer, during the Republican Convention, he stoutly defended the Police Department's aggressive "street-sweeping" policy toward demonstrators, alienating many liberals who had assumed that he was secretly one of them. At about the same time, Bloomberg announced that fifth graders would no longer gain automatic promotion to middle school, a policy shift that many teachers and education experts deplored. More recently, he agreed to spend three hundred million dollars of city money on a new football stadium for the New York Jets, to be placed on the West Side. If New York is awarded the 2012 Olympic Games, which Bloomberg is pursuing, the new arena would serve as an Olympic stadium. Last week, the National Football League announced that the stadium would also host the 2010 Super Bowl, assuming that it is finished by 2009.
The idea of situating a seventy-five-thousand-seat sports arena in the heart of Manhattan has enraged many New Yorkers. In a survey published earlier this month, fifty-six per cent of respondents said that they opposed the stadium, and just thirty-five per cent supported the idea. Bloomberg's rivals in the upcoming mayoral race are accusing him of wasting taxpayers' money and neglecting the concerns of ordinary citizens. "The city's education system is in disarray right now. Ask teachers, they say it; ask students, they say it," Anthony Weiner, a Democratic congressman who is running for City Hall, told me recently. "The Mayor can't change that. He's too busy with the stadium. He's spending money in the wrong place at the wrong time. It's a boondoggle, and New Yorkers know it." Fernando Ferrer, a former Bronx borough president, who is one of Weiner's rivals in the contest for the Democratic mayoral nomination, is calling for a referendum on the stadium. Another Democratic candidate, Gifford Miller, the speaker of the City Council, is trying to introduce legislation to block it.
Bloomberg's emergence as a polarizing figure has surprised many in the political world. "Friend and foe alike would say that Mike Bloomberg knows how to spend his money and his political capital," Mark Green, who was the losing candidate in the 2001 mayoral race, commented to me recently. “Also, he's very competitive, and he doesn't like to lose. Given that, I'm baffled why he's so out on a limb on the Olympics and the stadium, when he's not likely to win on either." Even some of Bloomberg's closest associates are worried that the dispute is detracting from his achievements in other areas, such as reducing crime and balancing the budget. "There is a group inside the administration that doesn't think we should be investing so much time and effort in the stadium," one senior city official said. "The Mayor talks about it every day. It has started to take over from everything else."
Shortly before Christmas, I met with Bloomberg, who is sixty-three, in "the bull pen," a big, open-plan office on the second floor of City Hall, where he works with his senior staff. The bull pen resembles Bloomberg's workspace at Bloomberg L.P., his media company, which specializes in selling financial information to Wall Street firms. (Before starting his own business, Bloomberg worked for many years at Salomon Brothers.) Seven rows of cubicles fill the room, and Bloomberg occupies a cubicle in the center. The atmosphere is informal but businesslike. "You look up from your desk, and you don't know who you are going to see," William Cunningham, Bloomberg's director of communications, told me. "One moment it is a county supervisor, the next it is Mikhail Gorbachev."
The biggest threat to Bloomberg may be his willful disregard for the normal rules of politics. Photograph by Mary Ellen Mark
Bloomberg was wearing a conservatively cut navy-blue suit with a monogrammed pink shirt, and his tanned face showed the effects of winter weekends in the sun. (Apart from his opulent town house, Bloomberg owns homes in Vail, Bermuda, London, and Westchester County) He looked tired. The previous day, he had flown back on his private jet from Dubrovnik, Croatia, where the European arm of the International Olympic Committee had been meeting to consider bids from five finalists - New York, Paris, London, Moscow, and Madrid - to host the 2012 Games. New York's bid had been well received, Bloomberg said, and London had also made a solid presentation, but Paris, the strong favorite to be the host city, had failed to impress. "I think London and New York moved up, and Paris moved down," Bloomberg said. "How that comes out in July in Singapore" - where the International Olympic Committee is due to make its final decision - "who knows? It's a long ways away."
In the past few months, Bloomberg has been combining his campaign for the Olympics with his other duties. When I asked him how he would assess his mayoralty he said that one way was to "look at some numbers that tell you about the public's confidence in the city's future." He ran through several of them for me: commercial vacancy rates (some of the lowest in the country); residential real-estate prices (up a hundred per cent in three years); applications to work for the city (arriving by the thousand). "By those numerical measures, I think you have to say we are doing O.K.," Bloomberg said.
Bloomberg has an almost mystical faith in figures, which he trusts more than mere anecdotal evidence, such as the contents of the newspapers that are covering the stadium saga. (The editorial pages of the Times, Newsday, and the Sun have criticized Bloomberg; the News and the Post have been more supportive.) In one-on-one situations, he can be very persuasive. He made his fortune - five billion dollars, according to Forbes - by convincing skeptical Wall Street traders that his firm's terminals were superior to the models provided by other companies.
He pointed to another, less obvious sign that the city was doing well: architectural trends. "In the seventies, we built buildings that filled up the entire city block, had very few entrances and an atrium in the middle, so you never had to leave. There was a feeling that the outside was dangerous. Today, go look at the new MOMA, go look at the building my company is putting up" - on Lexington Avenue and Fifty-eighth Street - "go look at the new Hearst building. The designs bring the outside in: they are open, and you can walk right through. That is a bunch of professionals giving you some views of the future. All the great architects seem to want to work here. For a while, London had every great architect. Hong Kong had them. But they never came to New York. Now, whether it's Sir Norman Foster, or Cesar Pelli, Vinoly, Piano - they all want to work here."
It is difficult to imagine Bloomberg's predecessors judging their records in these terms, but Bloomberg, who was born and raised in Medford, Massachusetts, is less parochial than most mayors. Like many businessmen who travel a lot, he thinks globally. He often talks about securing New York's place as the world's leading city - a status that Koch and Giuliani would never have thought of questioning in the first place. One reason that he wants New York to host the Olympics - and it is also why he brought the Republican Convention here - is to showcase the city to a worldwide audience.
Unfortunately for Bloomberg, most New Yorkers don't much care what people in Europe and Asia think of them. He tries to hide his cosmopolitan tendencies, riding the subway to work, attending Yankees games, dining out on Staten Island, and wearing ethnic headgear when the occasion demands. But not even he takes this pose seriously. A few months ago, I attended a Christmas party organized by the City Hall press corps. Bloomberg took the stage in a Stetson, which he removed to reveal a Yankees cap, then a Giants cap, and, finally, a yarmulke. "People are writing that I have become more of a politician, but that is ridiculous," he quipped. Then, turning to his press secretary, Edward Skyler, he added, "Ed, can I hold a few babies?"
Occasionally, Bloomberg lets slip what he really thinks about his adopted city and some of its eight million-plus inhabitants. He has described opponents of the West Side stadium as "negativists" and "naysayers." He has even noted, accurately but inadvisedly, that New Yorkers love to gripe. "For those of you who don't live here, New Yorkers are a funny group," he told international journalists at a luncheon last month. "We welcome everybody, but we also want to have our say."
At the time I first spoke to Bloomberg, in December, the construction cost of the stadium was estimated at $1.4 billion. (It has since risen to $1.7 billion.) The city and the state had agreed to invest six hundred million dollars split equally, with the jets paying the rest. Work needed to begin on the stadium immediately, Bloomberg said. "If you want the Olympics, you have to build the stadium right now, but we need the stadium anyway," Bloomberg said. "It's probably the single most important economic-development project in the city.”
Critics say the arena would be uneconomic, unsightly, and unnecessary. Contrary to Bloomberg's suggestion, they cannot all be dismissed as mere carpers. Many urban-planning experts believe that building a giant stadium on a site that represents the last great development opportunity in midtown would be a terrible error. Economists and fiscal watchdogs warn that paying for the Mayor's ambitious West Side plan would saddle the city with debt for generations. And many ordinary New Yorkers wonder why they should subsidize a football team that is owned by a multimillionaire - Woody Johnson - and whose fan base is in the suburbs.
When I mentioned the stadium's opponents, Bloomberg bristled. "These people," he said dismissively. "No. 1: most of the people that are criticizing it have never built anything in their lives, and they are not willing to put their own money up, so it leaves me a little cold. No. 2: the Jets have come in with eight hundred million dollars. Who else is going to come in with eight hundred million dollars? There's nobody. People say, ‘Somebody will.’ Look, this has been a disaster area for generations. It's also true, remember, that it takes courage to go and build things. If you want to study it forever, you will study it forever, and you will never come to any agreement."
When Bloomberg made this statement, nobody, apart from the Jets, had expressed any interest in developing the stadium site - a rail yard, owned by the Metropolitan Transit Authority, between Thirtieth Street and Thirty-third Street, west of Eleventh Avenue. But, last month, Cablevision, the media company that owns Madison Square Garden, whose business would be threatened by a rival stadium in midtown, offered the M.T.A. six hundred million dollars to buy the land and air rights, saying that it would use them for residential and commercial buildings and a five-acre park. The Jets had agreed to pay the M.T.A. just a hundred million dollars for the development rights - most of their original commitment of eight hundred million dollars was for actual construction costs. Cablevision's surprise intervention jeopardized this cozy deal, embarrassed City Hall, and prompted the M.T.A. to open up the bidding. The day it was announced, I ran into a senior city official, who smiled ruefully and said that he and his colleagues had been joking amongst themselves about what would happen if a third party came in and made an unsolicited offer. "Now it's happened," he added.
On March 21st, the Jets and Cablevision both raised their bids for the rail yard, and a third company, TransGas Energy Systems, also submitted an offer, which few took seriously. The Jets' revised bid was widely reported at seven hundred and twenty million dollars, but this was misleading. In fact, the Jets bid two hundred and eighty million dollars. The additional four hundred and forty million dollars consisted of a proposal from six developers, who have associated themselves with the Jets, to buy additional air rights, which they would transfer to adjacent sites in order to put up apartment towers. Cablevision's revised bid was seven hundred and sixty million dollars, but many of its details remained murky.
It isn't clear where this latest development leaves the stadium and Bloomberg. The M.T.A., which isn't obliged to choose the highest offer, has promised to make a decision by the end of March, but that won't be the last word on whether the stadium gets built. Even if the Jets prevail. their bid is contingent on further zoning changes, which would require the approval of the City Planning Commission and the City Council. (Cablevision's latest bid is said to be non-contingent.) The stadium also needs the authorization of a pair of upstate politicians: Joseph Bruno, the Republican leader of the Senate in Albany, and Sheldon Silver, the Democratic leader of the State Assembly. Bruno and Silver have yet to address the issue, and many observers expect them to delay as long as possible, which is the usual way of doing things in Albany. It is looking increasingly likely that Bloomberg will have to fight the election with the ultimate fate of the stadium unresolved. This is just what the Democrats want.
Back in January, 2002, when Bloomberg entered City Hall, he appeared to be something of a naysayer himself. At the time, public attention was focused on the Yankees and the Mets, who both wanted new stadiums. Rudy Giuliani, a Yankees fan, had expressed interest in bringing the team to the West Side, but he left office without winning support for the idea, and Bloomberg showed no inclination to revive it.
Bloomberg had said in campaigning that the city couldn't afford to pay for new sports stadiums and his priority would be education reform, which he views as an economic imperative. "When it comes to jobs, we have a two-pronged strategy," he told me. "One is to improve the school system, so that our children will be able to get the jobs of tomorrow, which require a higher level of skills. The other is to make sure that companies come here and create jobs." In June, 2002, Bloomberg persuaded the State Legislature to grant him direct authority over the schools, stripping power from the local school districts, which had run them for decades. He moved the Department of Education from Livingston Street in Brooklyn to the Tweed Courthouse, directly behind City Hall, and appointed as its head Joel Klein, a fifty-eight-year-old attorney who led the Justice Department's antitrust section during the Clinton Administration.
In addition to ending "social promotion" in the third and fifth grades, Klein has established a “leadership academy” for principals; hired a parent coordinator in every school, provided extra instruction in basic literacy and mathematics for students who fall behind; and encouraged the foundation of independent charter schools. He has also closed down more than a dozen dysfunctional high schools and fired about fifty principals. Bloomberg delegates a lot of responsibility to Klein, but he personally insisted on ending social promotion. "It was not the convenient or politically correct thing to do, but at some very deep level he has to be right about the following," Klein, who attended PS. 205, in Bensonhurst, told me. "If we keep promoting kids in the fourth, fifth, and sixth grades when they can't read, then we are just storing up trouble."
The teachers' union and Democrats claim that the simultaneous introduction of so many reforms has alienated people working in the system and thrown classrooms into chaos. "The Mayor's attitude to reform is 'It's my way or the highway,’" Betsy Gotbaum, the city's public advocate, said to me. "If you are going to introduce reforms, you have to engage the people who are going to implement them." Bloomberg's critics also accuse him of failing to address what they view as the schools' primary problem: underfunding. Rather than boosting the education budget in a big way, he has called on the state to provide more assistance, and has also encouraged schools to raise funds from private sources.
A while ago, I accompanied Bloomberg and Klein to P.S. 17, an elementary school in Williamsburg, where the Robin Hood Foundation, a charity, had helped to pay for a new library. Some third, fourth, and fifth graders stood up and said how much they liked it. A strapping boy named Martin Daity drew a grimace from the Mayor by expressing the hope that it would help him to become a famous political journalist. Bloomberg rang a school bell to mark the official opening. The students cheered and sang a song entitled "We Are Marching to Our New Library.” Then they marched next door for cookies and soda. After they had gone, Bloomberg took some questions, posing the first one himself - Why couldn't every elementary school in the city have a new library? "There isn't enough money to do it for every place," he replied. "Schools are one of the most important things we do, but we also have to pay our police and firefighters. There's never going to be enough money to do everything."
Bloomberg's decision to spend hundreds of millions of dollars on a sports stadium is a gift to his political opponents. However, there is a certain logic to it, given his technocratic approach to government. At Bloomberg L.P., he ran a company that had eight thousand workers and more than three billion dollars in annual revenues. As mayor, he thinks of himself as the C.E.O. of a sprawling public corporation that employs three hundred thousand people and spends about fifty billion dollars a year. Even some Democrats credit him with having been a quick learner. "He has been a lot better mayor than I expected," Mark Green said. "First, he makes few public mistakes. Second, he's shown enough energy and motivation to move around the five boroughs and avoid being labeled an out-of-touch billionaire. Third, he's an intelligent manager who, with a few exceptions, has shown he knows how to run an operation."
As a former trader, Bloomberg likes to start work early. He usually arrives at his desk before 8 A.M. and switches on a Bloomberg terminal. At nine, he and his senior staff walk across the hallway to an ornate room once occupied by the Committee of the Whole, a defunct city body, where they gather around a big wooden table. "In government, people think that in business you say jump and everybody jumps," Bloomberg told me. "That's not the way a good company is run. Good companies are run by leaders who delegate and build a consensus. In business, people think that everybody in government is lazy and incompetent. That's also not true." The main difference between running a company and running a city, Bloomberg says, is the level of scrutiny he receives from the City Council, state legislators, and the media. "In business, innovation is a lot easier, because you don't have to justify everything. In government, you do. There are lots of checks and balances. The bulk of them get in the way of progress. Having said that, they are virtually all there because of abuses in the past."
When Bloomberg took the oath of office, Wall Street was slumping, and the city's spending was outpacing its tax revenues. Under New York state law, the city is obliged to balance its books. In Bloomberg's first budget, which the City Council adopted in June, 2002, with only minor changes, he cut some services, raised the tax on cigarettes, and borrowed from the financial markets. As the economic downturn continued, it became clear that more stringent measures were needed. In November, 2002, City Hall estimated the deficit for fiscal 2004 at more than six billion dollars - a figure that prompted some commentators to draw comparisons to the financial crisis of the mid-seventies. Bloomberg introduced more spending cuts and raised residential property taxes by eighteen per cent, the biggest hike in memory, thereby violating pledges that he had made during and after his campaign, when he had said, "We will not raise taxes. We will find another way."
Bloomberg was being fiscally responsible, but he paid politically. By June, 2003, his approval rating in a Times poll had fallen to twenty-four per cent - the lowest rating recorded by any mayor since the Times began polling, twenty-five years ago. At public parades, elected officials shunned him, and he found himself marching alone. Eventually, though, the economy turned in his favor. The stock market rebounded, tourism thrived - last year, more than forty million people visited New York - and the price of real estate soared, giving a much needed boost to the city's property tax base. At the same time, the taxes that the city levies on purchases and sales of real estate brought in record revenues.
A couple of months ago, when Bloomberg released the preliminary budget for 2006, he was able to announce that the city will end fiscal 2005 with a surplus of nearly two billion dollars. In September, his administration began to send tax rebates of four hundred dollars each to more than six hundred thousand property owners. This year, he intends to send out another round of rebates, which voters will receive just before Election Day.
Looking back, Bloomberg says that raising taxes was the most difficult decision he has made, but he doesn't regret it. "I'm not in favor of taxes. Nobody is," he told me. "I think they do hurt us from a competitive point of view. But the fact that the city is doing well now vindicates my belief that there are more important things than cutting taxes: bringing crime down, beautifying the parks, cleaning the streets, building houses - all that sort of stuff.”
In the run-up to the election, Bloomberg wants to keep people's attention fixed on the economy, and not simply to extol its recovery. As a successful entrepreneur, he believes, above all else, in the constant pursuit of innovation and growth. "Let's not just sit here and say that just because our hotels are full and tourism is at record levels that everything is going well," he said to me. "We still have a structural problem in our budget - our expenses exceed our revenues by billions of dollars. We have to grow the city."
Bloomberg is undoubtedly right when he says that New York still faces great fiscal challenges. City outlays are rising inexorably, and the property boom won't last forever. Cutbacks in federal and state aid are responsible for some of the spending growth, especially in Medicaid, but the biggest item in the city's budget is still the wages and salaries of city workers. Although the number of people employed by the city has fallen by about sixteen thousand in Bloomberg's term, a sharp rise in the cost of employee benefits, especially health-care and retirement benefits, has meant that payroll spending has continued to rise. The city now spends about half as much on benefits as it does on wages. When the Department of Education hires a teacher at forty thousand dollars a year, which is about what junior teachers make, the city ends up having to spend, on average, about fifty-two thousand dollars.
Conservatives say that Bloomberg should have cut spending further. "His strategy has been to raise taxes, squeeze a little bit more out of the agencies, and pray that Wall Street comes through," Steven Malanga, a senior fellow at the Manhattan Institute, said to me recently. Malanga's characterization isn't wholly inaccurate, but it ignores the fact that Bloomberg is concentrating on the revenue side of the budget equation. During the past two years, he has laid out the most ambitious economic-development plan that the city has seen since LaGuardia's day. In his 2003 State of the City address, he made the case for moving beyond the rebuilding of lower Manhattan and embarking on major construction projects elsewhere - downtown Brooklyn, Randall's Island, Williamsburg and Greenpoint, Hunts Point, Homeport, on Staten Island, and, of course, the West Side of Manhattan. In each of these areas, the Mayor argued, the city could stimulate economic growth and boost tax revenues by rezoning underused land, clearing away bureaucratic red tape, and investing in public works, such as subways, roads, and parks. "When we lead with public infrastructure, the private market will follow," he declared.
Bloomberg's economic-development strategy isn't often described as a budget policy, but that is how he sees it. In business, firms routinely make costly investments to generate higher revenues in the long term. At Bloomberg L.P., which he still owns, Bloomberg invested in a powerful new technology, desktop computers, to create a multinational company. Even now, while he is in City Hall, the firm is trying to break into a new market: specialized information for lawyers. "It's an enormous investment," Bloomberg said in one of our conversations. "I don't know whether it is going to pay off. But I do know that we have to try new things and have another market for our product down the road."
What makes sense for a corporation, Bloomberg is convinced, makes sense for a city. "If we don't build these things - not just the stadium but things like this - we are not going to have the tax revenues to pay the municipal workforce," he told me. "The municipal unions should be the biggest supporters of this. The minority community should be the biggest supporter of this. We have to build these things or we are never going to have the tax base that we need."
In the physical history of New York, a number of dates standout: 1811,when Manhattan adopted the grid pattern for its streets; 1857, when work started on Central Park, 1883, when the Brooklyn Bridge was completed; 1904, when the first subway line started operating; 1931, when the Empire State Building was dedicated and the George Washington Bridge opened; 1946, when the United Nations decided to situate itself on the East River; 1966, when construction started on the World Trade Center and Governor Rockefeller announced his plan for Battery Park City; 1980, when the city and state agreed to renovate Times Square; and 2001, when the World Trade Center was destroyed. Bloomberg is trying to add 2005 to this list.
By 2025, City Hall hopes, the Hudson Yards development zone, which extends from West Twenty-eighth Street to West Forty-third Street, and from Eighth Avenue to the river, will be a thriving central business district. It will contain twenty-eight million square feet of commercial space, including one and a half million square feet of hotel space and seven hundred thousand square feet of retail space. There will also be some thirteen thousand apartments. This would be akin to dropping downtown Denver onto the West Side. The official rendering of the redeveloped area shows office towers lining Tenth and Eleventh Avenues and a tree-lined pedestrian boulevard extending from Forty-second Street to Thirty-third Street midway between Tenth Avenue and Eleventh Avenue. At the southern end of this thoroughfare, there is a six-acre park, adjacent to which the new stadium rises-majestically or ominously, depending on your point of view-above the West Side Highway.
At the moment, Hudson Yards is a low-rise neighborhood that covers three hundred and sixty acres, making it four times as big as the Battery Park City development zone. By almost any standards, it is bleak. Among its notable architectural features are the Port Authority Bus Terminal, the entrance to the Lincoln Tunnel, the cavernous Jacob K. Javits Convention Center, which blocks access to the river between Thirty-fourth Street and Thirty-ninth Street, and the Manhattan tow pound. Highways, access ramps, and rail lines blight the landscape, breaking up the grid pattern and making it difficult to traverse on foot. Below Thirty-fourth Street, the M.T.A. rail yard, which is hidden behind high concrete walls, is the dominant feature. (The tracks lead to Penn Station, which is two blocks east.) Nearby, there is a Greyhound-bus parking depot, a Sanitation Department refueling station, and several vacant lots.
To build a vast sports arena on top of the rail yard would be a feat of engineering. Constructing a reinforced-concrete platform over the yard to serve as the stadium's foundation would cost city and state taxpayers about three hundred million dollars, and another three hundred million dollars of public money would go toward a retractable roof, so the facility could be used year-round. The city is planning to spend two billion dollars to extend the No. 7 subway line from Times Square and three hundred and fifty million dollars to expand the Javits Center. In addition, hundreds of millions of dollars have been slated for new parks and roads, and for restoring the waterfront.
The city's total commitment to the West Side could end up exceeding three billion dollars. Bloomberg insisted to me that this spending won't affect other city projects, such as the construction of new schools, because it will be financed outside the regular budget. Under his plan, the Hudson Yards Infrastructure Corporation, a quasi-independent agency, would issue bonds to pay for most of the investments. "You can't go borrow to give the teachers a salary raise," Bloomberg said. "You can borrow to build something that is going to employ a lot of people and generate a lot of tax revenues."
In recent years, New York's economy has created lots of jobs for bankers, media people, lawyers, and other professionals. However, as Bloomberg pointed out, the majority of the city inhabitants are neither affluent nor well educated. "A lot of them are immigrants, but they are also people that have been left back for a long time. These people need a different type of job, in service industries - restaurants, hotels, transportation, that type of thing. Generally, those jobs can have pensions and health benefits and security, but they are in businesses that are often seasonal. We have to flatten out that seasonality. That means the convention business has to be developed. We are well behind any city remotely like us on the list of convention facilities. People don't seem to understand how bad off we are."
As Bloomberg ticked off the points he wanted to make, he gently thumped the table. "Let's assume we just expand the Javits Center," he said. "Given the physical amount of land we have, we will never be able to have more space than Chicago, Las Vegas, or many other cities. We've got to look for something that is unique. That is the ability to seat seventy-five thousand people for the opening night. That is the ability to have two hundred thousand square feet of open space, with big high ceilings, where you can do lots of visuals. That is the New York Sports & Convention Center. The trouble is, it has got the name 'stadium' attached to it. Why? Because the Jets are coming in willing to put eight hundred million dollars into it."
After stopping to take a breath, Bloomberg went on, "I don't care, quite honestly, whether the Jets play here or in New Jersey. From an economic point of view, most people who have tickets live around here already. They don't come and stay in hotels to go to a Jets game. On the other hand, using the facility for conventions and all these other things, that is where the money is."
Bloomberg cited a study by the Independent Budget Office, a nonpartisan city agency; which he said demonstrated that during the next thirty years the new facility would generate hundreds of millions of dollars for the city treasury. "People say, 'Build the stadium elsewhere, in Queens,’" he said. "There's one problem - it's not going to be rented other than the ten days the Jets use it, so there's no revenue. The city and state can't pour money in unless there is an economic benefit. What makes this work is that it's really a convention facility that the Jets, for their own reasons, want to pay for."
The person primarily responsible for Bloomberg's economic-development plan is Daniel Doctoroff, a forty-six-year-old former investment banker who is the deputy mayor for economic development and rebuilding. In political circles, Doctoroff is now widely viewed as the second most powerful man in City Hall. Many credit him with persuading Bloomberg to support the stadium plan in the first place. "My understanding is that Dan convinced the Mayor early on that this was very important to his legacy," Betsy Gotbaum said. People who work for Bloomberg also acknowledge Doctoroff's influence. "I honestly don't know how the Mayor has got so swept up with the stadium, and I think some of the other people in the administration don't know, either," a city official told me. "I think it's partly Dan's salesmanship, and partly that he firmly believes in the economic arguments."
Doctoroff is tall and athletic, with brown eyes, gray wavy hair, and a Roman nose. As his tide suggests, he was originally expected to spend most of his time on the reconstruction of lower Manhattan, but the state has taken the lead in that effort. (Governor Pataki controls the Port Authority, which controls the World Trade Center site). During the Giuliani administration, Doctoroff set up NYC 2012, the organization bidding for the Olympics. He was then working on Wall Street, where he was the managing partner of a successful investment company, Oak Hill Capital Partners. After Bloomberg’s victory, Doctoroff moved to City Hall, where he still oversees the Olympics bid. "From the very beginning, the Mayor made the decision to place all the different economic-development agencies under one person," Doctoroff said when I met him at City Hall recently. "What we have done, working with him, is develop a coherent strategy that takes into account the history of this city, the competitive factors we face, our strengths and our weaknesses. That is what makes it different from what we've seen before, and it flows from the Mayor's experience in the private sector."
Doctoroff is not overburdened with modesty, and, like his boss, he thinks globally. "Historically, New York has had the reputation of being the kind of place that says to businesses, 'Hey, we're New York. If you want to come, great. If you don't want to come, that's fine, too,"' he said. "In an increasingly competitive world, we can't afford to be that way. We aren't just talking about competition with New Jersey, Chicago, or Los Angeles. We're not even just talking about competition with London, which may be our most direct competitor in some ways. Look at Shanghai. Look at what Shanghai was two years ago, and look at what Shanghai is today - a completely different place."
Since the Chinese economy is expanding at near double-digit rates, it is hard to believe that New York will match the growth rates of Shanghai or Beijing. Still, as a global leader in finance, media, and fashion, the city should expect to see its economy expanding at a healthy pace. Expansion requires space, however, which is why Bloomberg and Doctoroff fastened their attention on the far West Side.
In the early nineties, the Regional Plan Association, a think tank on development issues, drew up a range of proposals for the West Side, all of which featured residential and commercial development. The group also examined the possibility of building an arena for the Yankees, in the style of Camden Yards, in Baltimore, but ultimately rejected it as unsightly and uneconomic. "We never even contemplated a football stadium, because the footprint is so large," Robert Yaro, the planning association's president, recalled. During the dot-corn era, the idea of developing the West Side was raised again, amid concerns that New York lacked room to house start-up companies. In June, 2001, the Group of 35, a panel of politicians, urban planners, and business executives, convened by Senator Charles Schumer, issued a report calling for the construction of sixty million square feet of office space by 2020, much of it on the West Side.
After Bloomberg came to office, the Economic Development Corporation, a quasi-independent body that reports to Doctoroff, produced an estimate of seventy million square feet for the amount of new office space that the city will need by 2035. If developers were to build on every currently available commercial site, the E.D.C. concluded, they could create perhaps half this amount of space, leaving a big gap for development zones to fit. "We don't feel like we have a choice," Doctoroff said, as he explained the decision to develop the West Side. "Over the last ten years, more than sixty thousand jobs fled New York City for the New Jersey waterfront."
Under Doctoroff's influence, development policy and the Olympics bid have become intertwined. Many experts have questioned the economic value of the Games, which have left some host cities, such as Montreal and Athens, heavily in debt, but Doctoroff believes that New York with its diverse ethnic heritage, could host a successful Games and also make money. In 1996, he hired Alexander Garvin, a professor of urban planning at Yale, to devise a plan for staging the Games that would exploit New York's unique topography. Garvin came up with an "X-plan," which is best understood by visualizing a slightly crooked "X" drawn across a map of the five boroughs. As part of the scheme, he situated the Olympic stadium on the West Side of Manhattan. "We had to figure out where to put the main stadium, the press center, and the broadcasting center," Jay Kriegel, the executive director of NYC 2012, said to me. "Garvin came in one day and laid out the X-plan, with the West Side as its centerpiece. It solved a lot of problems."
One problem that Garvin's X-plan didn't solve was who would pay for the Olympic stadium. In 2000, Woody Johnson, an heir to the Johnson & Johnson fortune, bought the New York Jets and decided to move the team back into the city, which it had left in 1984, when it stopped playing at Shea Stadium. Doctoroff started talking with Johnson, casually at first, and then, after he joined the Bloomberg administration, more seriously. Last March, a deal between the city and the Jets was announced. "The stadium idea wasn't budgeted," Kriegel recalled. "Then the Jets came along."
Inevitably, questions have arisen about Doctoroff's dual role as the city's economic czar and the de-facto head of the Olympics bid. Andrea Bernstein, of the public radio station WNYC, and Tom Robbins, of the Village Voice, have reported that builders and financiers with interests in Hudson Yards and other development zones have attempted to curry favor with Doctoroff by making financial contributions to NYC 2012, which needs money to pay for the bid. A family foundation controlled by Woody Johnson has given more than a million dollars. Several banks that have been hired to help finance the Hudson Yards project - Goldman Sachs, J. P. Morgan, and Bear, Stearns - have also made sizable donations. The developers who have contributed to NYC 2012 include Douglas Durst, Steven Roth, and Stephen Ross, an old friend of Doctoroff's.
Although Bernstein and Robbins didn't provide any direct evidence of companies' receiving favorable treatment in return for donations to NYC 2012, their stories demonstrated how it is now almost impossible to separate development issues from the Olympics bid. The West Side stadium is one of many Olympic sites that would be built in development zones. In Brooklyn, the Atlantic Yards arena, which the developer Bruce Ratner hopes to build for his New Jersey Nets franchise, would host gymnastics. Swimming and diving would take place at an aquatic center on the Williamsburg waterfront, which is scheduled to be rezoned, and the Olympic Village would be a couple of miles north, directly across from the United Nations. In the Harlem Yards development zone, a velodrome and arena would host cycling and badminton.
Doctoroff makes no apology for linking development policy to the Olympics bid. One of the main reasons for hosting the Games, he told me, is to revitalize depressed neighborhoods by building world-class sports facilities that New Yorkers will be able to use for decades. "Atlanta made a small profit" from hosting the 1996 Games, he said, "but the real profit was in the six hundred million dollars' worth of housing and recreational facilities that were built and left to the community as a legacy." Bloomberg agrees. "The Games would be great for the city," he insisted. "Great buildings. Great pride."
Many opponents of the stadium support the Olympics bid; they just don't think it justifies building a stadium in midtown. One of them is Richard Ravitch, a seventy-one-year-old businessman with a wealth of experience in city government, urban planning, and budget issues. Ravitch started out as a developer. From 1979 until 1984, he chaired the M.T.A., which operates the subways, the buses, Metro-North, and the Long Island Rail Road. In 1989, he ran for mayor, losing to David Dinkins in the Democratic primary. Today, he is a successful lawyer and business consultant. Although nominally a Democrat, he thinks of himself as a nonpartisan moderate, much as Bloomberg does.
A while ago, I spoke with Ravitch at his office in Rockefeller Center. He told me that to begin with he didn't have any objection in principle to developing the M.T.A. rail yard, although he was concerned that the agency, which has heavy debts, should get fill value for the site. But the more Ravitch learned about Bloomberg's plans for the West Side, the more agitated he became. Between now and 2011, the Hudson Yards Infrastructure Corporation is planning to issue about three billion dollars in bonds to finance the extension of the No. 7 line and other infrastructure projects. Like all loans, these bonds will need to be serviced. Under the city's plan, the cash to pay the interest on the debt, and eventually to retire it, will come from payments that developers who put up new buildings in Hudson Yards will make to the city - a financing scheme that Doctoroff described to me as "creative."
Ravitch, a man with a long memory, has a different view. In 1965, the State Legislature gave the city the authority to borrow against estimated tax revenues instead of against actual ones. In subsequent years, the city and a state body, the Urban Development Corporation, borrowed heavily. When tax revenues came in lower than expected, they didn't have enough money to service their debts, and they had to be bailed out. The West Side plan struck Ravitch as eerily reminiscent of what happened a generation ago. "I spent ten years of my life clearing up the mess that people of good will and integrity created in the sixties and seventies," he said. "I saw in the West Side plan all of the things that had led to the crisis of the seventies, and I thought, If I don't speak out, why should I expect anybody else to?"
In the past few months, Ravitch has expressed his objections to the West Side plan in a variety of venues, but Bloomberg has not been receptive. "The Mayor is clearly very bright," Ravitch said, "and, like nearly all successful businessmen, he's not filled with self-doubt. That is the most felicitous way I can put it. He sincerely wants to do the right thing, but he doesn't welcome counsel - at least, that was my impression."
The most vocal and effective critic of the stadium plan has been James Dolan, Cablevision's chief executive. Last year, Dolan launched an advertising campaign that attacked City Hall's planned subsidy to the Jets. For awhile, Bloomberg and his colleagues weren't too concerned. Cablevision is an unpopular cable monopoly, and Dolan has overseen the decline of two of the city's favorite sports teams: the Knicks and the Rangers. After taking over as chief executive of Cablevision from his father, Charles Dolan, who founded the company, he bought out of bankruptcy the electronics chain The Wiz only to close it down five years later, after it made more heavy losses. "Do we really want one of the worst businessmen in history to be dictating the city's economic-development policy?" Ed Skyler, Bloomberg's press secretary, said to the Times. But Dolan has proved to be a determined foe. Even before his surprise bid for the development rights to the M.T.A. rail yard, he kept the stadium proposal in the news and allowed less self-interested parties to marshal their arguments, which City Hall has had trouble refuting.
It is now clear, for example, that, despite the Mayor's assurances, the stadium could well end up being a burden on city taxpayers. According to the Independent Budget Office's latest "baseline" projection, between now and 2036 the stadium would generate for the city treasury about four or five million dollars a year over and above its annual cost in interest payments, a modest but positive return. (These figures are in 2005 dollars.) However, the I.B.O.'s calculations assume that the stadium will be able to attract twenty-four trade shows a year, which is an optimistic assessment. The convention industry is suffering from chronic overcapacity, with cities all across the country struggling to attract visitors. In a recent study published by the Brookings Institution, Heywood T. Sanders, a political scientist at the University of Texas at San Antonio, noted that "many cities have seen their convention attendance fall by 40 percent, 50 per cent, and more since the peak years of the late 1990s." If the stadium were to fail to attract enough convention business, it would have great difficulty paying its way.
From a long-term perspective, another critical issue is whether the stadium would stimulate development elsewhere on the West Side. Many economists and urban-planning experts doubt that it would. "When you go around the country, across the street from these things there is nothing except parking lots and auto-repair shops," the Regional Plan Association's Robert Yaro said. "The experience is that sports stadiums repel economic activity. Nobody wants to live across the street from these things. Nobody wants to work across the street from these things." Ronnie Lowenstein, the head of the Independent Budget Office, agreed. "The economic literature is very clear on that," she said. "Stadiums are not good economic-development tools."
As the dispute over the stadium has escalated and Bloomberg's poll ratings have started to suffer, his advisers have been attempting to portray him as a visionary. "They don't remember the mayors who said, 'Let's not do anything,’" Cunningham, Bloomberg's director of communications, said to me. "They remember the mayors who said, 'Let's build for the future.' LaGuardia's not considered a great mayor because he wore funny hats and was a short guy. He built the Triborough Bridge and the West Side Highway. When New York stops building, it's not New York."
Cunningham's peroration contained some truth, but Bloomberg isn't trying to build a bridge, a road, or any other public facility. On the West Side, he is ultimately proposing to build a new stadium for an N.F.L. franchise, more hotels and convention space for out-of-towners, and yet more luxury condominiums - hardly a campaign rallying cry. However, if he can somehow divert attention from the stadium, he does have a record of tackling intractable issues in other areas, such as homelessness.
Between 1999 and 2003, the number of people in the city's homeless shelters increased by seventy per cent, to more than thirty-eight thousand. Last June, a task force appointed by Bloomberg presented him with a plan designed to end chronic homelessness in ten years. "The Mayor said, 'I'm term-limited to eight years,"' Shaun Donovan, the city's housing commissioner, recalled. "He said, 'You might like a ten-year plan, because you can't be held accountable, but I want to be held accountable. Make it a five-year plan." Linda Gibbs, the head of the Department of Homeless Services, was stunned by Bloomberg's suggestion. "He was, like, 'Can you do it?' I was, like, 'Ugh.' I didn't want to say no," she told me.
The new plan, which included setting up community programs to try to prevent homelessness, has been in operation for less than a year, but it seems to be having some impact. The over-all number of people living in shelters has stabilized, and the number of families in shelters has fallen slightly. Meanwhile, under a separate program, more than twenty-six thousand units of affordable housing have been built, many of them in poor neighborhoods, such as Harlem and Bushwick
Bloomberg's perceived independence is his biggest strength, but it isn't enough to guarantee his reelection. In a city where whites make up less than half of the population, and where registered Democrats outnumber registered Republicans by nearly six to one, Fernando Ferrer, who is bidding to become New York's first Hispanic mayor, could be tough to beat. Last week, a Newsday/ NY1 poll showed Ferrer leading Bloomberg by forty-nine per cent to thirty-five per cent in a head-to-head contest, and a WNBC/Marist College Institute poll showed Ferrer up by forty-nine per cent to forty-two per cent. "What Mike and his people can't know for sure is whether his mayoralty is a momentary and freakish end to the tragic events of 2001," Mark Green said. "It's a different election now. It's not 2001."
To boost his chances, Bloomberg is trying to woo minority voters and politicians, many of whom support his economic-development plans. The Harlem congressman Charles Rangel and the Reverend Al Sharpton have both come out in favor of the West Side stadium, saying that it would create jobs for minority workers. In Brooklyn, blacks and Hispanics generally support the proposal to build a basketball arena at the intersection of Flatbush and Atlantic Avenues. (Many white property owners oppose it.)
One evening this winter, Bloomberg held a town-hall meeting in Cambria Heights, Queens, a leafy African-American neighborhood on the city's eastern border, near the Belmont racetrack. When I arrived, about five hundred residents were packed into an auditorium at Sacred Heart School. Barbara Clark, the neighborhood's State Assembly representative, stood and praised Bloomberg for trying to improve the education system. "This is a middle-class community, but we don't have public schools here that people want to send their kids to," she said. I asked Clark, who is a lifelong Democrat, whether Bloomberg's ties to the Republican Party made much difference to how he is perceived in the area. "I don't think so," she replied with a laugh. "I don't think anybody really believes that the Mayor is a Republican."
When Bloomberg arrived, he said that Cambria Heights reminded him of the town where he grew up, and asked for questions. He didn't get any about the stadium. A grandmother in a red coat named Anne Miller asked him when the high weeds on Linden Boulevard between 221st Street and 222nd Street would be chopped down. "Does 'By Monday' work?" Bloomberg replied. The president of the Cambria Heights Little League inquired whether a decrepit park could be cleaned up. Bloomberg said that it could. Bob Wilkinson, an elderly man with white hair, asked about the property-tax rebate, which he was still waiting to receive. A few weeks previously, he said, the Department of Finance had sent a check for four hundred dollars to his house, but it was addressed to the previous owner, who died in 1970. "I wrote on the envelope and sent it back, but it came back again," Wilkinson said, to loud guffaws around the hail. "Mr. Mayor, how should I proceed?"
Last month, a delegation from the International Olympic Committee spent four days in New York, touring the proposed Olympic sites, asking questions, and being feted by, among others, Donald Trump and Whoopi Goldberg. Doctoroff led NYC 2012's presentations, but Bloomberg also played a prominent role, comparing the Olympic ideals of diversity, competition, and opportunity to New York's own values, and inviting the visitors to dinner at his home. At a lunch reception that I attended, he gave a moving speech, without notes, invoking his grandparents, who came to New York from Ukraine and Lithuania, and his daughter, Georgina, who hopes to compete for a place on the U.S. equestrian team. "I have no greater dream than to see my daughter win a gold medal on Staten Island, in New York City," Bloomberg said. "It would be the ultimate capstone of my life."
Before the I.O.C. representatives left, their leader, Nawal El Moutawakel, a former Olympic hurdler from Morocco, praised New York's bid and said of the Mayor, "He is a winner, and his team is a winning team." "She didn't have to be so generous," a beaming Bloomberg told me a few days later in City Hall. "I was surprised. Usually, they don't say anything." The Olympic officials had gone away impressed, he added, and there was now a real chance of New York's getting the 2012 Games. "The committee clearly said to us, ‘We need to have a stadium. Get over that one.' But, once we have a stadium, I do think we have a good chance."
The professional oddsmakers, who don't allow local pride to bias their calculations, believe that Paris and London are still far more likely to be chosen than New York. Even if the stadium goes ahead, the I.O.C. might well choose another city. Some Democrats privately relish this scenario, believing that it would leave the Mayor in an awkward position, but Bloomberg insisted that if the Olympics bid fails he will fight just as vigorously for the stadium. "Without it, ten years from now nothing will be done on the West Side," he said.
Unlike in our previous encounters, he acknowledged that nobody could be sure how much convention business the stadium would generate, but he also argued that this was no reason to stall: "If you take a look and do a real economic assessment of these deals, there are no guarantees. So, if you want to stop something, you say we can't guarantee that anybody is going to use it. That's true, but in this case I know it's going to be used. Forty per cent of the debt service for the city and state's part of this project is already paid for by the Jets. In business, nobody ever gets a chance to start a project where forty per cent of the revenue needs are guaranteed."
When I asked Bloomberg how the stadium controversy had affected his chances of being reelected, he replied, "We are doing an experiment, and I'll give you an answer on November the eighth." Given the Mayor's virtually limited campaign budget, he is sure to be a formidable candidate. With more than seven months to go until voting day, his campaign has already spent over five million dollars. "I am always amazed at writers who cover his electoral prospects as if he were called Mike Smith," Mark Green noted. "They write about education, crime, and so on, not mentioning the biggest factor of all - his money. In 2001, I spent about sixteen and a half million dollars - twelve million that I raised and four and a half million in public funds. But Mike's direct-mail budget alone was seventeen million dollars, more than the entire budget for my campaign. I would stand there each day and see pieces of mail targeted at every ethnic group and Zip Code in the city, and there was no way I could respond."
The biggest threat to Bloomberg may be his own willful disregard for the normal rules of electoral politics. After three years in City Hall, he still cannot hide his scorn for regular politicians, who pay attention to popular opinion. "Let me say something," he said. "If you told me that the stadium was detrimental to my reelection chances, I would probably fight for it even harder. I wasn't hired to think about the politics. My job is to do what I think is right, cognizant of everybody's interests, and, to the extent I can, to make everybody agree with me. But I was not hired to do a poll every day and just slavishly follow it."
Bloomberg was starting to sound suspiciously like any ordinary politician whose grand vision is under attack from voters. His ultimate aim, he went on, is to secure New York's future as a place of risk-taking, innovation, and enterprise, the sort of place where people do things that others question, such as putting up iconoclastic buildings, creating new media companies, and covering Central Park with pieces of orange fabric hung from vinyl gates. "Look at the history of 'The Gates,'" he said, referring to the lengthy struggle that his friends Christo and Jeanne-Claude had encountered in putting up their recent art installation. "Why that many people would be that upset about something that goes on for two weeks, once in a lifetime, I don't know, but it was very, very controversial. Now everybody thinks, looking back, that it was the right thing to do. It was great for the spirit of the city, great for the economy."
It was late in the afternoon, and outside another snowstorm was blanketing the city from Riverdale to Far Rockaway. Bloomberg was speaking fast, staring at me intently, and gesticulating. "It would be a tragedy if we let the naysayers stop us doing things," he said. "What has always been great about New York has been that we've built the big things and taken the risks. People say, 'You were a business guy. You don't understand politics.' Yes. I was a very successful business guy because we took the risks in the business. We built for the future. You never know what the future is going to be like, but you have to build in advance. Running risks is exactly what you want to do. If you don't run any risks, you will never make any progress."