Radicals At Work
Originally appeared in The Economist,
November 6, 1993
At first sight, it was not easy to detect some great truth in the myriad state and local elections that took place across America on November 2nd. True, this was a bad day for incumbency. Governor Jim Florio of New Jersey was ousted by Christine Whitman, the Republican who gave Senator Bill Bradley such a fright in 1990. Yet the victory of the monied Mrs Whitman, a very ordinary political from the school of noblesse oblige, came as a surprise only because James Carville, the Democrats' spinmaster, had seemed on the point of rescuing his man's campaign. There will now be handwringing at the White House, by nature a superstitious place, which had hoped that, if Mr Florio could raise taxes and still be re-elected, so could Bill Clinton.
This gubernatorial victory for the Republicans, however, had a little in common with the one in Virginia, a state which simply reverted to type. Nor was the Republican victory in the New York mayoral race much like Mrs Whitman's. There, Rudolph Giuliani, capitalising on the weakness of his rival, David Dinkins, had set himself up as a big-city strongman to rival Fiorello LaGuardia, New York's most famous mayor. Yet Mr Giuliani's margin of victory was as wafer-thin as Mr Dinkin's last time round, and the vote was cast long exactly the same racial lines.
Yet, if there has been a theme in recent mayoral races, it is that voters are prepared to cross racial and political lines in favour of efficient, non-ideological government. Dennis Archer, a black moderate Democrat who won in Detroit on promises of dismantling the old Democratic machine, is a case in point. But it is the Republicans who have generally ridden this wave better.
Richard Riordan did it in Los Angeles, Steven Goldsmith in Indianapolis; Mike Turner has now done it in Dayton, Ohio. Even Mr Giuliani in New York, for all the racial polarity of his election, is part of this movement: he stands for cuts in the city workforce, cuts in taxes, privatisation, more efficiency. It leads to supposition that would have been unthinkable only a few years ago. The future of the Republican Party may lie with the country clubs of New England, nor even with the devotees of Rush Limbaugh. It may lie with this new bunch of mayors, out to prove that their brand of Republicanism can overcome the decay of America's inner cities.
An inspiring example of it is on trial just across the Hudson river from New York. Jersey City is a run-down town of 230,000 people, whose rusty waterfront and crumbling overpasses are only too visible from the towers of the World Trade Centre. For three-quarters of a century the city was run by a democratic machine. Its corruption and partronage were notorious; the machine's last mayor, Gerald McCann, is now in jail. His successor, Bret Schundler, is white, fresh-faced and out of Salomon Brothers. A Republican, he took 68% of the vote five months ago in a city where two-thirds of the population are blacks, Latinos or Asians. Mr Schundler has become the darling of vigorous Republicans such as Jack Kemp and Newt Gingrich.
Mr Schundler has taste for practical action. It is a year since Mr Schundler first came to power, in a special election for Mr McCann's successor. At that point the city was able to collect only 78% of the property taxes owed to it. Because those still paying taxes were faced with a stiff surcharge to make up for those who were not, the collection rate was about to fall further. It was already only just above the point at which the state of New Jersey would have been obliged to take over the city's finances.
By bundling together the tax obligations and selling them on to Wall Street, Mr Schundler has been able to raise enough money to cut taxes, while pushing the collection rate up to 91%. With a stabler tax base, he has started to deliver on his campaign promises of safer and cleaner streets. He is giving people local power. Street cleaners, gardeners and other municipal workers will be hired and fired by their neighbourhoods and districts. He has taken 60 police officers from behind their desks (where three-fifths of them had sat) and put them on foot patrol, where they will be accountable to newly-formed neighbourhood police committees. The mayor plans to put another 240 officers on the streets; already, reported crimes have fallen by 14% in the past year.
Mr Schundler's obsession with clean streets is in marked contrast with the predilection of America's mayors for travelling around the country boosting their cities to big corporations. The mayor abhors the idea that politicians can create jobs by handing out temporary tax bribes to companies. Marketing, says Mr Schundler, is the most marginal of his priorities. The typical politician's claim that he has created jobs is "the height of hubris", since a tax break here must be made up by a tax rise there.
Mr Schundler's longing to get everyone's taxes down is not just routine conservatism. Immediately, he does not pretend to be able to attract the high-value businesses that thrive in highly-taxed Manhattan. Jersey City has a poorer and less educated population, the sort of people who work in high-volume, low-margin businesses such as the back-offices of securities houses. And such businesses, to survive, need low taxes. Two Wall Street firms are to move 2,000 jobs to Jersey City. New York's Daily News is moving printing presses there.
For cites like this, the state can be of most help by getting itself off their backs. About 30,000 men and women are on welfare in Jersey City, and 20 city-paid people are vaguely trying to find them jobs. Mr Schundler wants to hire a large, private-sector recruitment agency to train and place people for the new jobs now being created. For that, a state waiver is required. Jim Florio, now the outgoing governor, failed to grant it. Nor is Jersey City exempt from the competitive-tender rules that make it hard to hire local "ghetto workers" accountable to neighbourhoods.
Despite his notions of "empowerment", Mr Schundler believes in vigorous local government, one that is good at "offering solutions, not preaching self-reliance." This is one reason why his brand of Republicanism has managed to appeal both to blacks and to immigrants who resent the paternalism of old-style Republicanism but have had little help from the Democrats.
Mr Schundler's brand will succeed if it creates a class of citizens prepared to take on the groups that make up the old political machines. It will not be easy. In Jersey City the teachers' unions fiercely oppose the mayor's plan for school vouchers. About 30 police officers have filed suit against him for wrongful reassignment.