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Two GOP-led Cities Bouncing Back
Christopher Ruddy JERSEY CITY It wasn't. Instead,
Jersey City was becoming as synonymous with urban decay as the Bronx.
Taxpayers and the middle class were in flight, corporations shunned the
available office space, eyesore buildings and vacant lots proliferated,
and crime and racial problems grew.
Remarkably, the same
city today leads the Northeast in job creation and in the decline of
poverty, and is on track to overtake Newark as New Jersey's largest
city.
Even more remarkable is
its mayor, 37-year-old Republican Bret Schundler, a onetime Wall Street
whiz who engineered the turn-around by unshackling the city from
old-style Democratic ward politics in favor of Jack Kemp-style
Republicanism: privatization, tax cuts and school reform.
Schundler is an
anomaly, but he is not alone. In Indianapolis, Mayor Steve Goldsmith is
running for governor after five years of proving that conservative
Republican politics can work in big cities with entrenched unions and
special interests.
But Schundler has so
far done more with less, and in less time. In late 1992, Schundler, a
Harvard graduate who once considered becoming a Presbyterian minister,
decided to take a Don Quixote challenge to the status quo. In Jersey
City there was much to challenge: The registration was almost 10-1
Democatic, no, Republican had controlled city hall in almost eight
decades, and even the city demoraphics seemed tilted against
Republicans. Minus a 10 percent Asian population, the remaining 90
percent of Jersey City's population of 230,000 breaks almost into
thirds: black, hispanic and white.
A special election was
called in late 1992 to replace the mayor, as the previous occupant of
the office had been convicted on federal coruption charges. In a close
race, Schundler won with a simple plurality. The local party chiefs saw
it as an aberration to be corrected in the next election. They were
wrong. After promising voters that in six months he would lower their
taxes or they could throw him out, he won a full four-year term with a
landslide 68 percent of the vote.
Schundler won over
Democratic converts by beginning to reform city government, and the
people liked it. As Schundler tells it, Jersey City was a "kleptocracy"
in which "the machine worked not for citizens, but for members of
the club. Everything in government was geared to help members of the
club."
One of the chief
backers of this club was the local teachers union, part of the National
Education Association. According to the Wall Street Journal, Schundler's
willingness to challenge the teachers union earned him the title "The
NEA's Public Enemy #1". His original sin, from the union's
standpoint, was proposing a private school voucher. Failing to clear
that with the state Legislature, he initiated a program funded by
private donations to encourage students to go to private schools. His
calls for reform have earned him the respect of lower-income voters,
traditional stalwarts of the Democratic Party.
With his Wall Street
skills, he was able to get a grip on city finances and expose the
machine's finagling. To continue spending even when finances did not
allow, the machine had thought up a nifty idea: double commercial tax
assessments to artificially increase the power to issue bonds. From 1989
to 1992, as real estate values plummeted and business avoided the city
because of the high assessments, the city shouldered an additional $100
million in bond debt.
Schundler says that had
he not had to pay back this debt, taxpayers in Jersey City would have
had whopping tax cuts. Instead, Schundler held the line on taxes as he
pared down the budget. Thirty percent of the city's non-uniformed job
positions were cut -- not through layoffs, but rather through incentives
and attrition. He
instituted the first public employees' Medical Savings Account program
-- one that became so popular it is now preferred by city workers even
as it saves the city money.
Schundler likes to tell
the story of when he first became mayor, he discovered that two police
officers were assigned full time to deliver interoffice mail among the
precincts -- at a cost of $175,000 a year. Those cops are now assigned
to the streets, and clerks do the mail job at a fraction of the cost.
Much of what Schundler
has done follows the footsteps of the mayor of Indianapolis, Steve
Goldsmith, ho took office in 1992. Like Schundler, Goldmith is a
Republican who was faced with a falling economy, heavy tax rates, a
fleeing middle class, and entrenched unions. Like Schundler, Goldsmith
turned to innovative strategies. His efforts cut spending by $100
million a year.
Goldsmith, 48, is
trying to turn his success into higher office, and is running for
governor. At packed luncheon hosted by the Manhattan Institute -- a
think tank dedicated to free-market solutions -- Goldsmith last month
laid out the sweeping innovations he has accomplished, some of which
mirror Jersey City's strides:
Contracting Out: Privatization: Crime and
Infrastructure: How have these
Republicans succeeded in cities normally considered bastions of the
Democratic Party? Simple, they say, because they focus on people and
services rather than Draconian spending cuts and layoffs. Jersey City,
for example, has been able to cut the number of citizens receiving
public assistance in half since Schundler took over, largely due to
increased job opportunities. By emphasizing the better delivery of
public services through private means, the mayors have been able to
reduce spending, cut taxes, revitalize business activity and improve the
quality of life in their cities.
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