Old Man Revenue: As Cuomo changes course, Silver just waits for Albany to come back around

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Sheldon Silver, Michael Bloomberg, Christine Quinn. (Dana Rubinstein)
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ALBANY—Sheldon Silver is not normally given to outward displays of anger, or excitement, or, well, any human emotion.

But the even-tempered, unrushable Lower East Side Democrat, ambling along toward the record for longest-tenured speaker of the State Assembly, betrayed some uncharacteristic joy last week just before he reached an agreement with Governor Andrew Cuomo and the Republican-controlled State Senate to salvage half of a high-earner tax surcharge he spearheaded in 2009.

“We’re all partners in this,” the speaker said, shuffling between his office and the closed-door conference room where he’d discussed the deal with the 99 other members of the Assembly's Democratic majority. “There’s always pushback from people who think we should have been raising $4 billion, or $3 billion, but I think this is a fair compromise and takes care of some of our needs, and it also does something very important by giving some progressivity to our income-tax code.”

Much has been written about the political acrobatics that allowed Cuomo and Senate Majority Leader Dean Skelos to back a partial extension of the so-called millionaires tax, after a year of authoritatively declaring that doing any such thing would prompt businesses to run, screaming, from New York. By contrast, the actions and motives of Silver—perhaps the most inscrutable power broker in one of the least democratic state governments in the country—need no explanation whatsoever. He and his colleagues held firm for over a year in the position that the much-maligned millionaire's tax should be renewed to prevent cuts to education and human service funding.

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In other words, while the political winds blew Cuomo away from his party and to the right, and then back to the left, Silver achieved his goals by staying dead still.

“He’s been at the forefront of the millionaire's surcharge, and while it’s not the way we passed it in 2009, it’s a giant step for the others in this dance, and it wasn’t for him,” said Assembly Majority Leader Ron Canestrari, a Democrat from Cohoes, in Albany County. “I think the speaker deserves a great deal of credit for this agreement.”

He has gotten it, in places. The Nation editor Katrina vanden Heuvel, in a column which describes Cuomo as “a contradictory figure,” praises Silver, who, in his “resolute commitment to the non-wealthy, never stopped talking in his gravelly monotone about the need to insist on shared sacrifice by the economically fortunate.”

Certainly, Silver was under considerable pressure in the last budget negotiations in the spring of 2011, when he essentially negotiated against both the governor and the Senate on the issue of revenue. Cuomo had crept his way to 70-plus-percent approval ratings by singing a right-leaning chorus on taxes. And all Skelos had to do to please his Republican constituency was go along with Cuomo's lead, letting a temporary income-tax surcharge on the wealthy, enacted by Democrats who didn’t want to cut spending in 2009, expire.

Silver handled Cuomo gingerly, not so much fighting as letting it be known that he opposed the expiration of the high-earner surcharge. But eventually let his members know the bad news: not this time. Just wait.

Any legislative leader derives his strength from his conference, and Silver's Democrats badly wanted the surcharge. Yet Silver came through the process relatively undiminished. He’s been speaker for 16 years, having survived a 2000 coup attempt, and has grown the Democratic majority in the 150-member chamber to as high as 110 members. At this point most members of the Assembly have no memory of any other leader. (Silver, now 67, is widely believed to have it as a personal goal to break the record of Oswald D. Heck, of Schenectady, who lasted 22 years as speaker before dying in office.)

There was a hard swallow when Silver told the Assembly Democrats the news—“It was like the general calling in his colonels and telling them he was going to surrender,” one lawmaker told the Times—but his members followed him, also going along with a plan to cap local property taxes that was tied to an extension of rent regulations. It wasn’t what they wanted, but Silver insisted that he had cut the best deal possible, and they believed him.

The economy continued to sputter this summer, against a backdrop of brinksmanship and inaction in Washington. At the same time, in New York, unions and progressive groups diligently put their ducks in a row, determined not to be caught off-guard, as they were in the last cycle.

And then came the Occupy movement, which shifted public conversation back to income inequality. While Occupy Wall Street drew headlines and rallied thousands to the streets (since they were marching, drumming, and publicly urinating in his district, Silver publicly wrist-slapped the demonstrators), its little brother in Albany crept under Cuomo’s skin and gave him the acid moniker “Governor One Percent.”

Cuomo started talking about revamping the tax code in a meeting with the legislature’s Black, Puerto Rican, Hispanic and Asian Caucus in October.

“Leadership is assessing where we are,” said Assemblyman Karim Camara, a Brooklyn Democrat who chairs the organization.

With Cuomo looking for a way to blunt the criticism on the left and take a whack at next year’s deficit, those 2009 taxes looked irresistible. He knew he had to act quickly—it would be nearly impossible to claim this wasn’t a tax increase after January 1, when old rates for people earning over $200,000 went back into effect —and that he couldn’t take all $4.1 billion that Silver and his folks were pushing for.

The resulting legislation brought in $2.6 billion but gave away $400 million in lower rates for people reporting between $20,000 and $200,000 in income. More money to reduce the M.T.A.-dedicated payroll tax and provide flood-relief upstate was attached to win over Senate Republicans.

But for Silver, the deal was an easy one to accept.

“It’s better to take half a loaf than nothing,” Canestrari said.

In the end, only two Assembly Democrats voted against the legislation.

With the new revenues in place, a budget shortfall for next year that was predicted to be $3.5 billion is now supposed to be less than $2 billion. Silver is already positioning himself, coolly, for the next round of negotiations, which will determine how much of that deficit will be made up of cuts rather than new revenue.

“We can find some efficiencies, but I think the cuts have by and large been made last year, and anything beyond that would be deeply hurtful and not productive,” Silver told the Times the next day.

It was a final reminder: He'll be perfectly happy to help out next time, too, just as soon as the other two men in the room are prepared to listen to what he's been saying, quietly, all along.

Jimmy Vielkind is a political reporter for the Times Union and the principal contributor to its Capitol Confidential blog.