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By Nicole Gelinas

After The Fall: Saving Capitalism From Wall Street--and Washington

Eye on the News

Nicole Gelinas
Who Will Run Albany?
Spitzer or Silver?
8 November 2006

Governor-elect Eliot Spitzer won his landslide victory on a platform to reform Albany in the same way he says he reformed Wall Street, by attacking “a system that lacks accountability.” One person, above all, has represented that lack of accountability for over a decade: assembly speaker Sheldon Silver. Spitzer’s success or failure in neutralizing Silver’s future influence in the weeks ahead will give New Yorkers an indication of whether Spitzer’s efforts at reform will succeed or fail.

After all, Silver hasn’t just run the assembly for the past 13 years; he is the assembly. The legislative rules that Silver has honed dictate that rank-and-file members, even in the majority party, have virtually no power. As the Brennan Center for Justice at NYU’s School of Law reminded New Yorkers recently, “lawmakers are . . . shut out of decision-making . . . and the essential elements of the legislative process, such as committee hearings on bills, . . . are hard to find in Albany.”

And because Silver, along with the governor and the senate majority leader, is one of Albany’s fabled “three men in a room,” nothing goes forward legislatively in Albany unless he agrees to it. Further, Silver makes sure nothing goes forward if it might hurt one of the state’s deep-pocketed special interests: the health-care lobby, the union lobby, or the trial-lawyer lobby.

Of course, Silver isn’t the only Albany legislative leader happy with the status quo; his counterpart in the state senate, Republican Joe Bruno, happily teamed up with him three years ago to override Governor Pataki’s budget vetoes. The two men hiked taxes to avoid cutting the rate of growth in spending for the state’s health-care lobby.

But to see why Silver, a Democrat, offers an object lesson in why New York State remains in decline, consider just one recent example of his obstructionism. Until last year, New York had an 80-year-old law that held auto-leasing companies ultimately responsible for accidents caused by drivers who leased or rented their cars. The law made about as much sense as, say, holding Chrysler responsible for accidents caused by the customers who buy and drive their vehicles. The law drove many auto-leasing companies out of New York, and it forced those that stayed to protect themselves by asking customers to jump through expensive legal hoops. The law had no constituency save the trial lawyers.

But the law stayed on the books thanks to Silver, who used his control of the assembly to block its repeal repeatedly. Silver said that he got in the way to protect victims of car accidents. But the more likely explanation for his obstructionism is that he himself is a trial lawyer and is beholden to the trial lawyer lobby. In fact, it took blanket federal legislation last year to nullify the auto-leasing law and similar if more limited laws in a few other states.

If New York on its own couldn’t repeal such an absurd law due to Silver’s opposition, what are the state’s prospects, even with a new governor, for enacting legislation that’s far more vital to the public interest but that also would hurt Albany’s special interests—like Medicaid reform?

One way that Spitzer could show that he has both the power and the will to achieve real reform in Albany would be to use his mandate to get the assembly to install a new leader open to such reform. It’s been done before: 12 years ago, Governor Pataki spent the weeks after his victory lobbying state senators to throw out then-majority leader Ralph Marino and put Bruno, a Pataki supporter, in his place by Thanksgiving. Further, in certain circumstances, Spitzer has insisted that the CEO of a company he was investigating step down before he would negotiate with that company. As he said in 2004 of then-boss Jeffrey Greenberg at insurance broker Marsh & McLennan, which he was investigating, “[Greenberg’s] is not a leadership I will talk with. It is not a leadership I will negotiate with.”

Spitzer can’t push Silver out by refusing to negotiate with him; Albany isn’t Wall Street. But Silver’s grip on the assembly isn’t unbreakable. After 13 years and one failed attempt at a coup by dissenting assembly members, Albany insiders say, some of the rank-and-file resent Silver and the power he wields, partly because he’s simply been around for so long.

What’s more, assembly members must think about their own interests (as they always do anyway). Representatives from outside of New York City, for example, should fear the safety of their incumbent positions should another two years go by before the next election without reform of dysfunctional Albany. Why? Gotham voters tend to concern themselves more about the mayor than about Albany, so the seats of Gotham assembly members should stay safe. But suburban voters care about the fact that unfunded mandates from Albany, like Medicaid, have pushed up their local property taxes. Plus, upstate voters worry about the parlous health of the state’s economy.

Spitzer has some practical tools at his disposal to put a new assembly leader in place. He could work with a potential speaker over the next few weeks to promise supportive members sweeteners like bigger offices, bigger staff, and the power actually to control some legislation, should they give reform a chance in Albany.

But Spitzer would have little room for error. If he tries to strip Silver of his leadership and publicly fails, he’d enter the governor’s office in January already weakened. On the other hand, if he doesn’t try to oust Silver, Silver might suspect that it was because Spitzer knew he couldn’t succeed. That’s why the next few weeks matter crucially for New York’s future.

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