MAYOR BLOOMBERG HAS SQUANDERED OUR MONEY

OPINION OCTOBER 16, 2008 New York Will Survive Without Bloomberg
The mayor never bothered to prepare the city for any lean years.By JASON L. RILEY
"Next to the assumption of power is the responsibility of relinquishing it."
-- Benjamin Disraeli
Citing the financial crisis, twice-elected New York Mayor Michael Bloomberg wants to scrap the city's term-limit law. He's asking the city council to pass a bill that would allow him to seek four more years in office.
Obviously the mayor believes that he's indispensable to Gotham's well-being, which will come as no surprise to any journalist who's met with him. What's passing strange is that so much of the local press seems to share the mayor's inflated view of himself.
The city's two major tabloids, the New York Post and the Daily News, both ran editorials under the headline "Run, Mike, Run" that called for changing the rules so that Mr. Bloomberg could stand for re-election next year. And the New York Times complained that the term-limits law "is particularly unappealing now because . . . it would deny New Yorkers -- at a time when the city's economy is under great stress -- the right to decide for themselves whether an effective and popular mayor should stay in office."
The paper took the opposite view seven years ago, when there was talk of extending the second term of Mr. Bloomberg's predecessor, Rudy Giuliani, in the wake of 9/11. "To suggest that the city would be incapable of getting along without Mr. Giuliani . . . undermines New York's sense of self-sufficiency," said the Gray Lady. "While Mr. Giuliani has been a great leader during this crisis, the truth is that no one is indispensable."
How Times change.
With a job-approval rating around 70%, Mr. Bloomberg is almost certain to win a third term if allowed to run again. He's continued Mr. Giuliani's policing policies and kept crime down. The mayor also deserves praise for his aggressive pro-development policies, such as rezoning large swaths of the city where industry is not coming back. Mr. Bloomberg, a nominal Republican who switched parties to run for office, made education the centerpiece of his first campaign, and he's made good on a promise to implement reform. Merit-pay pilot programs have been introduced, the number of charter schools has expanded, and student test scores have improved modestly.
But the argument for extending the two-term limit for Mr. Bloomberg -- a self-made billionaire who got his start on Wall Street -- is that the city needs someone with his financial acumen to help weather the fallout from the banking crisis. The biggest problem with that argument is that Mr. Bloomberg hasn't been very adept at managing the city's finances, even though he's had record revenues to work with.
Between 2000 and 2007, New York's tax receipts grew by 41% after inflation. "That's something that's never happened or come close to happening in the city's modern history," says Nicole Gelinas, who follows municipal finance at the Manhattan Institute. This windfall had everything to do with the Wall Street bull market, and everyone knew that the rate of growth was unsustainable. Instead of using the flush-year surpluses to put New York's fiscal house in order, however, Mr. Bloomberg mostly squandered them.
The four big costs to New York's budget are Medicaid, pensions, debt and health care for public employees. Since the mayor took office seven years ago, those costs are up 57% after inflation. His handling of the city's debt is particularly disappointing, if not irresponsible, since debt-service payments are legal obligations that can't be suspended during economic slowdowns.
Since 1990, debt per person in New York is up by 185%, exceeding inflation by 118 percentage points and exceeding tax revenue growth by 27 percentage points. By most measures, New York has higher per-capita debt (about $7,000) than any other city in the nation. And while the problem obviously predates the current mayor, the future burden has worsened substantially on his watch.
Instead of cutting other parts of the budget and using the city's swollen coffers to service debt and pay for capital projects out of operating spending, Mr. Bloomberg chose to increase borrowing. Between 2000 and 2007, debt grew by 5.7% annually and will continue to grow by 5.9% annually over the next four years. By increasing the city's debt obligations while doing nothing to decrease the city's overdependence on income tax revenue from Wall Street wages and bonuses, Mr. Bloomberg has exacerbated a bad situation.
The mayor's spending record isn't much better. Between 1975, when New York faced its last fiscal crisis, and the Giuliani era, city spending rose by just 9% after adjusting for inflation and population growth. Mr. Bloomberg's 2008 budget is nearly 50% larger than the one he inherited from Mr. Giuliani in 2001. That far outpaces inflation, which rose 21% over the same period. Nor has the mayor shown any sustained interest in working with the state to reform a Medicaid system that costs the city $6 billion per year and is rife with waste and abuse. New York state's per-capita Medicaid spending is easily the highest in the U.S.
Another popular argument for keeping Mr. Bloomberg in City Hall is that his potential successors -- New York Rep. Anthony Weiner, City Controller William Thompson and City Council Speaker Christine Quinn -- are the political equivalent of the Three Stooges. It's true that the city could do worse than Michael Bloomberg. But it's also true that mayoral term limits were approved by New Yorkers twice in referendums in the 1990s, and not by small margins.
There is something deeply undemocratic about legislatively overturning the will of the people without giving voters a say in the matter. And there's something deeply disturbing about a local press corps that lets the political class get away with it.
Mr. Riley is a member of The Wall Street Journal's editorial board.