The May 3,2010 Issue of The Capitol

www.nycapitolnews.com� may 10, 2010 THE CAPITOL

By Andrew J. HAwkins

The hope was for a marquee name: Pataki or Giuliani or, hell, even Zuckerman.

Instead, there are many names, none of them marquee: Bruce Blakeman, David Malpass, Joseph DioGuardi and Edward Diana.

In a year when the weakness of state Republicans has becoming a running theme— especially while the rest of the country tilts red and even Massachusetts has a statewide Republican—the lack of a major challenge to Sen. Kirsten Gillibrand is to many the greatest symbol of a party that has collapsed.

So instead of a major contender giving the largely unknown appointed junior senator with consistently mediocre poll numbers a run for her money, Blakeman, Malpass, DioGuardi and Diana are fighting for the back pages of the newspapers, if they get any attention at all. As the state convention approaches, they are all barnstorming the state to meet with local GOP and Conservative Party chairs, hoping to avoid a costly Republican primary for a race against an opponent known for her fundraising prowess. Each has his own argument for explaining why the party will rally around him. And each would rather be handed the nomination than fight for it.

Republicans are nervous that a primary could end up squandering the party’s best chance at knocking the unelected senator off her perch in a year when anti-incumbent fever and anger toward Washington is running as high as ever. If she slides by this year, by 2012 she will have been in the Senate four years, and seeking a full term in a presidential election year. Take her out this year, goes the conventional wisdom, or expect her to be a senator for life.

Ed Cox, the state party chairman who has been at the center of a revolt within his own party over the gubernatorial race, said that Gillibrand is highly vulnerable this year.

“She has flip-flopped on any number of issues,” Cox said. “We have four great candidates, each with very good qualifications. And any one of them would be able to beat her.”

Blakeman, a former Nassau County legislator and Port Authority official who ran an unsuccessful campaign for state comptroller in 1998, has been running the longest (since early January) and has amassed the most mainstream Republican

support. State Senate Minority Leader Dean Skelos, former Sen. Alfonse D’Amato and Rep. Peter King have all endorsed him. He has the support of 16 county chairs, as well as a key endorsement from Queens Conservative Party Chair Thomas Long, brother to state party chair Mike Long.

With over $300,000 in the bank and 9,000 miles logged on his Ford, Blakeman said he is confident that he will receive the nomination.

“I believe that I will be the consensus candidate,” Blakeman said. “But I am prepared for anything.”

Some Republicans, though, are concerned about Blakeman’s ability to raise enough money to match Gillibrand’s millions, especially given the skepticism several key Republicans have about his rationale for running. Moreover, he is seen as quickly morphing into a permanent candidate, as evidenced by his brief campaign for New York City mayor last year.

Malpass may be the tallest candidate in the race, but according to polls he is the least well known, with support from only 5 percent of Republicans. But what he lacks in name recognition he makes up for in a rock-solid Republican résumé. A former deputy treasury secretary under Ronald Reagan and deputy secretary of state under George H.W. Bush, Malpass has had a hand in several key economic policies of the last 30 years, including the North American Free Trade Act and the Brady plan for developing-country debt. He was a chief economist at Bear Stearns when the firm collapsed in 2007, a fact his rivals and Gillibrand may look to exploit. Malpass said he had no involvement in promoting the mortgage-backed securities that led to the firm’s collapse.

He lags behind his rivals in county chair endorsements, but he still has some

big names on his side, such as economist and presidential candidate Steve Forbes and John Faso, the 2006 Republican candidate for governor.

Unabashedly wonky—campaign press releases focus less on county chair endorsements than topics like the value-added tax and trade restrictions in financial markets—and fluent in Spanish (also Russian and French), Malpass is right on the issues for many Republicans, though short on political charisma.

Malpass has self-funded most of his $1 million campaign account, arguing that his lack of political flair can be an asset in a year when voters are sick of Washington insiders.

“I think it’s critical we bring someone from outside the system out there appealing to younger voters,” he said. “I’m able to talk about jobs and small businesses in a way the insiders can’t.”

DioGuardi, a quick-talking former two-term congressman from Mount Vernon,

With No A-List Candidate, GOP Mulls Over Crop Of Gillibrand ChallengersEd Diana latest low-rung candidate to enter campaign against junior senator

sees the Conservative Party endorsement as his secret weapon in the race, having locked down 17 party endorsements from around the state so far.

“They see that I’m raising money. I’ve put my own money in this race. Logically, I’m the only one,” he said. “Malpass or Blakeman have no chance of getting the Conservative line.”

DioGuardi worked for over 20 years at the now-defunct accounting behemoth Arthur Anderson, served as president of the Albanian American Civic League and founded the non-profit Truth in Government Inc., which is dedicated to tracking the nation’s rising debt load.

But this year, he realized his most reliable claim to fame is being the father of American Idol judge Karla DioGuardi. When greeting someone on the phone, he will refer to himself as “Joe DioGuardi, candidate for Senate and Karla’s dad.”

For that and other reasons, DioGuardi is seen by his fellow Republicans as energetic and

entertaining, if not entirely serious. According to a recent poll, he leads his rivals in name recognition. He has raised almost $1 million (also mostly from his own pocketbook), and says he expects to raise up to $15 million after he wins the nomination.

And adding to an already crowded field is Orange County Executive Ed Diana. Party officials say they are particularly excited by Diana’s entrance into the race, considering Orange County is one of the fastest growing in the state and Diana has a string of hard-fought electoral victories already under his belt, though there is some consternation and confusion about why Cox waited until May to recruit yet another candidate for this race.

Diana said he would need to win the Republican, Conservative and Independence lines in order to be competitive against Gillibrand, a feat he feels is within reach.

“I understand the magnitude of this race,” Diana said. “But I also have to be very clear that when I take something on, I am in it to win it.”

On policy, all four candidates are nearly indistinguishable from each other. They all talk about repealing the health care reform bill, lowering taxes and creating jobs. They all want to curb illegal immigration. None of them feels that Gillibrand has earned the office she currently holds.

But while Republicans are nervous that a bruising primary between the four candidates could leave the winner too cash-strapped for the general election, there might be a silver lining, said Siena pollster Steven Greenberg.

“A primary can be useful for whomever wins the primary,” Greenberg said. “It gives them some momentum and something to crow about.”

[email protected]

Bruce Blakeman

Joseph DioGuardi

David Malpass

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NEW YORK IS LOSING BILLIONS ON UNTAXED RESERVATION CIGARETTES

Tax Dollars We Need for Vital Services Go UncollectedLike an old leaky bucket, Albany is letting billions of tax dollars slip away. Why? Because New York fails to collect excise taxes on cigarettes sold through Native American reservations to non-tribal members.

In today’s budget crisis, we need every penny to help protect vital services like education, health care and public safety. And while New York looks the other way, reservation outlets sell over 200 million untaxed packs a year — about the same volume of cigarette sales as the entire State of Massachusetts.

The state is losing revenue. Legitimate, hard-working retailers are losing sales – and their employees could even lose jobs.

With New York facing a $9 billion budget defi cit, it’s time to enforce the law and start collecting these taxes. Before Albany cuts services or raises taxes, the state must close this enormous tax loophole.

Tell your legislators to enact S6985/A10128, and require the Department of Tax and Finance to enforce the law and collect the tax on cigarettes sold through tribal reservations. We can’t afford not to.

Contact your legislators by calling 877-893-4882 or visit www.CollectTheTaxNY.com and speak out fortax fairness.

ENFORCE THE LAW - COLLECT THE TAX!Visit www.CollectTheTaxNY.com Today

Paid for by Altria Client Services on behalf of Philip Morris USA.

www.nycapitolnews.com4 may 10, 2010 THE CAPITOL

By DaviD FreeDlanDer

When asked about the Republicans’ chances of unseating Rep. Carolyn

McCarthy, the Nassau County Republican chair holds up a piece of paper lying in the center of his desk that contains the names of seven people who are vying for the right to take her on in November.

“On a personal basis I’ve found her to be a very nice lady who’s totally uninformed,” Joseph Mondello said.

Mondello went on to accuse McCarthy, who is now in her seventh term, of voting in lockstep with Nancy Pelosi.

“To me, that is a disgrace. She is supposed to vote her conscience and her mind,” he said. “Despite being a nice lady, this year it’s going to catch up with her.”

In years past, Republicans have struggled to find candidates to run against “Saint Carolyn,” so dubbed both for her nurse-like demeanor (she is, in fact, a licensed nurse) and for her life story—she ran for Congress after her husband and son were shot by a crazed gunman on the Long Island Rail Road. In 2008, for example, Mineola Mayor Jack Martins, considered by many to be a bright light in the party—and this year running against State Sen. Craig Johnson—lost to McCarthy by 28 points.

But last year, Nassau Republicans retook the county executive, county comptroller and the majority in the county legislature. That has helped convince Mondello and other local Republicans that McCarthy can beat beaten, despite her years of big victories.

“The candidates we beat last year had big wins too before we ran against them,” Mondello reasoned.

Most local and statewide Republicans think that Frank Scaturro is the front-runner for the nomination. The Hofstra University Law professor has raised over $250,000 as of the last filing, and has been running hard for the better part of the last two years. James Garner, the former mayor of Hempstead, has also been exploring a run, but he was trounced by McCarthy in 2004. Thomas Liotti, a Westbury judge, is also considering jumping in the race, and some local Republicans are looking to draft Assembly Member Tom Alfano as well. There are also a handful of candidates that have come out of the energized Tea Party movement in the area, and they are

angling for the Conservative Party line if they fail to capture the Republican one, a move that would delight Democrats.

But the county convention is just a few weeks away, and Mondello still has not made an endorsement, even a tacit one (local Mondello watchers say that as soon as a candidate starts showing up at events with other local elected Republicans, Mondello’s preference will be clear).

And some wonder if Mondello, despite his protestations, is holding his fire. New York is likely to lose at least one congres-sional seat in the next round of redistrict-ing. Since Rep. Pete King is seen as likely to find his district combined with another, that could put King in the same district as another Republican, if McCarthy loses this year. That could make for some awk-ward times in Nassau come 2012.

Plus, McCarthy has for years been dogged by rumors that she is on the cusp of retirement, and Mondello may be

waiting until she does to run a loyalist for an open seat.

Tony Santino, a spokesman for the county Republicans, has long been thought to be waiting for a run.

In an interview, Santino said he would not be a candidate in 2010, but refused to speculate beyond that.

Mondello said that he had no intention of biding his time to knock off McCarthy.

“I am not going to wait for her retirement,” he said. “I think people are demanding new representation, and they are going to get it.”

McCarthy has raised nearly $1 million. She said that the rumors of an impending retirement are grossly exaggerated.

“The funny thing is, everybody knows how hard I am working, and they should take that as a hint that I am not retiring,” she said. “There are still many things I want to do while I am here.”

Still, the last term for McCarthy

has not been an easy one. She had back surgery earlier this year, which severely limited her mobility for months. Pennsylvania Rep. John Murtha, an ally who had taken McCarthy under his wing, died, and Murtha’s former staffer-turned-defense-lobbyist Paul Magliocchetti, who used to steer millions of dollars towards McCarthy’s re-election campaigns, shut down his firm in the wake of a federal investigation. Plus, the issue of gun safety, which afforded McCarthy a national profile, has faded from public consciousness. McCarthy associates say that she has seen a softening in her numbers in the district in recent months.

McCarthy has always been a vigorous campaigner, but has lacked a base of support within the Democratic Party, relying instead on a few close associates to run her campaigns year after year. She said that she was aware of the challenging landscape this year and had begun campaigning earlier.

“Everything has been pushed up a little bit,” she says. “Every election year it’s like, ‘My god, they are coming after me. I’ve got to get out there.’”

Meanwhile, Democrats are jockeying for position to be the candidate of choice when the day finally comes that McCarthy retires. Since the district will be differently drawn, most of the early speculation is just that. Still, names have emerged, including district attorney Kathleen Rice, if she were to lose the attorney general’s race, and State Sen. Craig Johnson. Former Nassau County Executive Tom Suozzi’s name has been floated as well.

But most of the local chatter has focused around Kevan Abrahams, a Nassau County legislator. The district is currently one-third minority, most of whom vote Democratic. Nassau politicos say that Abrahams could give McCarthy a serious scare now if he wanted to run.

Abrahams admitted that Congress is his career goal.

“It’s like any other profession where you want to move up, and that would be a place to move up to,” he said.

Still, Abrahams stressed, he is content to wait for McCarthy’s move.

“She is safe from a Democratic primary. If she is going to be taken out, it’s going to come from the other side.”

[email protected]

In Nassau, Emboldened Republicans Reconsider McCarthy ChallengeThough seven candidates line up for November, attention is on race to succeed congresswoman

EDITORIALEditor: Edward-Isaac [email protected] Editor: David [email protected] Editor: Andrew J. Hawkins [email protected]: Chris Bragg [email protected] Rivoli [email protected] Editor: Andrew SchwartzInterns: John Dorman, Selena Ross, Andre Tartar

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The Capitol is published monthly.Copyright © 2010, Manhattan Media, LLC

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EDWARD J. MALLOY,President

LAWRENCE DAVISSecretary/Treasurer

New York State Building &Construction Trades Council“Building an Economic Ladder to“Building an Economic Ladder to

the Middle Class through thethe Middle Class through theUnion Building Trades…”Union Building Trades…”

NY State B.C.T.C890 Third Street

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You said,“Our State continues to face severe cash-fl ow

diffi culties and extraordinary fi nancial challenges.”

We say,“Taxpayers continue to face severe cash-fl ow

diffi culties and extraordinary fi nancial challenges. Don’t make the Legislature’s struggle OUR struggle.”

Include funding for capital projects in the next round of Emergency Appropriation Bills.

www.nycapitolnews.com� may 10, 2010 THE CAPITOL

to get the name out there, but you’re less likely to get the issues out there.”

Those issues, according to the Greens, will be government and electoral reform, in addition to progressive taxation, a

carbon tax and other standards of leftist politics. They take inspiration from this month’s elections in Britain, in which the Liberal Democrats surged out of their own eternity in the wilderness to being a

major player, with their strong showing in this month’s elections and the hung Parliament ahead.

“This election, we’re really defining success as getting that ballot line back. We’re not under the illusion, except on an off chance, that any of our candidates are going to win,” said Peter LaVigna, a political science doctoral student at SUNY Albany who serves as the other Green state co-chair. “Our role, if we get the ballot line, at the local level and the state level, is to be kind of a shadow government like they have in the U.K., bringing up issues and talking up issues. That’s really the way that third parties start to have influence.”

Despite the lack of a ballot line, Greens have had a few successes at the polls. Cur-rently, the mayors of Victory and Green-wich are registered with the party, as are a few local council and school board mem-bers scattered around the state. There is a 57-member state committee, with the bulk of the members from New York City,

though there are representatives as well from Albany, Chenago, Delaware, Gen-esee, Rensselaer, Schenectady, Steuben, Suffolk and Tompkins counties.

Where they are now, according to the Greens, will be their lowest point. Though, like in 2006, the gubernatorial election is likely to be dominated by a popular Democrat headed toward a big win, they think that Hawkins will be able to carry an anti-Andrew Cuomo, anti-Republican message that will resonate in the current political climate, getting them to 50,000 and allowing them to escape what LaVigna refers to as the “period of stagnation” in the eight years since they lost the ballot line.

Potential puns on the party name aside, the Greens have never been flush with cash. As of the January campaign finance filing, there was just over $8,000 in their account. They are hoping some new recruits being drawn to the party and enough media attention will help change that, powering through the process of gathering 15,000 valid petition signatures over the summer to put Hawkins on the ballot. They may also strike a strategic alliance with the state Socialists, who, according to LaVigna, are considering cross-endorsing Hawkins and helping carry petitions.

Gloria Mattera, the party’s secretary treasurer, said that the party is preparing to reach out beyond the 22,000 enrolled members, identifying Green-friendly vot-ers from a database amassed over the

By Edward-Isaac dovErE

“Grandpa” Al Lewis and Malachy McCourt were never regulars in People Magazine

or US Weekly, but they were big enough names for the Green Party to pick as the gubernatorial nominees in the hopes of getting a little rubbed-off celebrity sheen. The strategy was simple: hope that the spectacle of these men running for office (they also once approached the more famous, but now deceased actor Ossie Davis about running) would be enough to push the party over 50,000 votes, giving them the ballot access to let the real work of politicking at the local level begin.

It worked in 1998, when Lewis cleared 52,000 votes, despite losing a series of court cases trying to get listed on the ballot with the nickname he had held onto since his days acting on The Munsters. Looking back, the Greens see this period as a sort of golden age, allowing them to dig into the local races where they wanted to be involved without having to worry about complicated petitioning processes.

The golden age lasted four years, until Stanley Aronowitz’s 2002 run for governor fell short of the 50,000 mark. They were back in the wilderness. And in 2006, McCourt, for all his witty columns and bit acting parts over the years, could not bring them back.

This year, Green activists are taking a different approach as they hope to capitalize on the same kind of voter dissatisfaction that is energizing critics of the Obama administration.

“You’ve got the people on the right, this Tea Party movement,” said Eric Jones, one of the co-chairs of the state Green Party, “and there’s just as much disillusionment on the left.”

To start, they have ditched the idea of plucking another person from the D-list for the gubernatorial race. Though noth-ing will be official until the party conven-tion, coming up in the middle of May, the prohibitive favorite is Howie Hawkins, a man best known for running as the 2006 Green candidate for Senate against Hill-ary Clinton and for unloading trucks dur-ing the night shift at his local UPS facility.

According to Jones, the decision to go with one of the party faithful is about a larger strategy for the Greens.

“People within the party are sick of not being taken seriously,” said Eric Jones, one of the co-chairs of the state Green Party. “When we took these celebrity candidates, there’s always kind of a backlash. It’s kind of a double-edged sword: you’re more likely to get media,

years. The party will hire a statewide pe-tition coordinator, she said, but the real work will be done through past associa-tions and word-of-mouth connections on the local level. Social media, they hope, will help as well.

“We’re probably scarce on metrics at this point in terms of how we can

do the polling and door-to-door work,” she said, “but that really comes at the grassroots level from pockets of green activists around the state.”

The Greens seem likely to field a full slate, with the race for the United States Senate nomination the only one currently being contested.

Hawkins has been putting together the pieces of his gubernatorial run since last November, when he returned home from a night in jail on a civil disobedience charge to find a number of messages on his answering machine encouraging him to run. He had lost a race for council in Syracuse two days earlier (he got 41 percent), but, he decided, he was already raring to go again.

Though he admits that his race is less about getting to the Executive Mansion than raising issues and getting ballot access back, Hawkins

does have some campaign proposals, such as ratcheting up the stock transfer tax to 100 percent to pay for WPA-style infrastructure projects and creating a single-payer health care system at the state level.

Among the clear sore points for Hawkins and other Greens is the Working Families Party, which has co-opted a lot of the ground on the political left once occupied by the Greens, but has had a much more effective political operation that has allowed it to gain primacy.

“They’re not independent, they’re a satellite party of the Democratic Party,” Hawkins charged, complaining that the WFP is able to do what it does thanks to the money drawn from union PACs and Democratic candidates. “They’re a conduit for corporate cash—they get hundreds of thousands of dollars from the Schumer campaign or the Clinton campaign for their field operation.”

Hawkins also criticized the WFP for cross-endorsing with the Democrats and Republicans. The decision not to do that, he said, is what sets the Greens apart and, in his opinion, makes them stronger.

“They haven’t really taken our ground,” Hawkins said. “Fusion creates confusion, but it doesn’t create independent politics, where the power of ordinary working people is independent—which is what you need if you’re going to challenge the two corporate parties. If you’re a faction, they’ll take you for granted.”

[email protected]

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Howie Hawkins is a different kind of Green gubernatorial candidate: issues-orient-ed, not D-list celebrity.

Without A Celebrity Candidate, Greens Hope Policy Gets Higher BillingParty puts hopes in UPS worker Howie Hawkins to get back ballot access

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Just last week, the Senate took the courageous step of lifting the charter school cap, which both improves our kids’ education and puts New York in the running for $700 million in education funding from the Obama Administration. In these tough times, with our schools

facing huge budget cuts, we need Albany to stand up to the teachers’ unions and pass these needed reforms. Let’s fi nish the job.

Albany must act now because the deadline for New York’s new bid is only a few weeks away.

CALL ALBANY AT 877-540-2717

Tell them to pass education reform now.THERE’S NOT A MOMENT TO LOSE.

www.nycapitolnews.com8 MAY 10, 2010 THE CAPITOL

BY SELENA ROSS

After having let it rust for more than a decade, backers on both sides of the aisle want to bring back prior

approval, a far-reaching policy that gives the state oversight over health insurance premiums.

But, they say, they are moved to act not only by looking back over 10 years of skyrocketing premium prices, nor by the thought of short-term savings. The emphasis is on the future: Albany is mulling over—despite warnings from big insurance companies—whether the policy will help ready the state for federal health reform, creating an early snapshot of how New York will react to the Obama health bill.

Prior approval allows the state to review premium hikes before insurance companies charge them, generally keeping prices lower

than the double-digit increases of recent years. Included in all

three budget proposals, it would be expected to save $70 million this year and $150 million next year by making insurance affordable to some people currently on Medicaid.

But more importantly, supporters say, New York has a small window of time to streamline and take control of its health system before federal reforms start to transform it. They say that passing prior approval will prepare for the patients, consumer dollars and public investment soon to fl ood the system.

“I really think it will fi t nicely with federal reform,” said State Sen. Neil Breslin, chair of the Insurance Committee. “The key component of federal reform will be that we will probably be insuring close to two million more New Yorkers. And the companies that will be insuring them are the same companies that we are working with now.”

In a post-health care reform New York, health insurance companies will be checked by new controls. Federal or state governments will review premium increases, just like under prior approval, and companies will have to report the justifi cation for these increases to federal offi cials, the state and the public.

The reform bill has also laid out how insurance companies will be monitored in the planned regional health insurance exchanges. If an insurance provider is deemed to offer plans that are too expensive and not in the competitive spirit of the exchanges, the provider will be kicked out.

John Powell, assistant deputy superinten-dant for health at the state Insurance Depart-ment, said that passing a state prior approval law makes sense in the context of these two new federal plans—partly because they explic-itly require something like prior-approval, and partly because they are still so hazy that New York would do best to go ahead and start plan-ning how they will take shape.

“We don’t know who has the authority to do anything if there’s unjustifi ed, unreasonable premium increases. It kind of begs the question, ‘Does someone have prior approval here?’” he said of the direct premium reviews. Meanwhile,

he said, “prior-approval authority is absolutely necessary in the exchange.”

Other experts say that the amount of new pub-lic funding that will be handed out starting in 2014 is giving state governments reason to look care-fully at where that money will be going. Some of this money will come as subsidies to help people buy insurance in the exchanges, and some will come as grants to help states ramp up their regu-lating power, said Peter Newell, a health insur-ance expert at United Hospital Fund.

“I think it’s safe to say we’re entering a new era in the way premium rate increases for individuals and small employers are handled,” said Newell.

But Mark Wagar, president and CEO of Empire Blue Cross Blue Shield, said it is precisely now, during the lead-up to the implementation of the federal health care reforms, that New York needs to pull itself back from overdoing regulations. As a bellwether for the rest of the country on health care, he said, New York would squander its leadership position by creating losses for insurance companies, politicizing rate hike decisions and otherwise destabilizing the system, all of which he said were inevitable consequences of prior approval.

“I think that New York is absolutely the right place to talk about what that impact is, because we have had almost all of the reforms that are being talked about in place here for almost 20 years,” Wagar said. “We have regulations in place that are in fact stronger than are mandated by the federal government.”

Opponents also say the state needs to tackle underlying costs rather than mandating lower premiums. Rising medical costs, both sides agree, are a huge problem.

The dozens of changes coming with federal reform, including a larger pool of insured New Yorkers, are intended to bring down premiums and help lower those costs. But until then, free-market advocates say, prior approval is dangerous in combination with New York’s other stipulations that permit almost anyone to buy insurance.

“All that does is create this insolvency problem where insurers will just go bankrupt,” said Paul Howard, a health policy analyst at the Manhattan Institute. “I don’t think there’s any sign that insurers are just price-gouging.”

Breslin is not convinced, saying that 10 years was enough to confi rm for him that prior approval will fi t New York in the present and future.

“It’s already long overdue,” he said. Direct letters to the editor [email protected].

2008

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2001$800

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With Health Care Reform Passed, Approval Of Prior Approval Nears DebateAlbany may take action in advance of implementation of new federal legislation

Albany is mulling over—despite warnings from big insurance companies—whether the policy will help ready the state for federal health reform, creating an early snapshot of how New York will react to the Obama health bill.

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11 Cornell Rd., Latham, NY 12110 • 518-782-9400

120 Wall St., New York, NY 10005 • 212-785-0157

www.nysna.org

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Offi ce is independent in the sense that the director is appointed to a fi xed four-year term and cannot be removed by the next governor. But it does not have an independent budget. Instead, the offi ce is funded out of money generated by a longstanding assessment the state charges to authorities for overhead expenses. That assessment generated $55 million last year, which is to be divvied up by the governor and Legislature.

With its resources limited, the offi ce had not launched a new review of any

public authority’s operations since the law was passed in March, said the offi ce’s director, David Kidera.

Among the current staff of seven, including Kidera, three people are tasked with auditing the hundreds of authorities. The other three employees provide technical assistance to the roughly 2,000 annual inquiries from public authorities

BY CHRIS BRAGG

When Gov. David Paterson signed a bill last December to regulate the state’s 700-plus

public authorities, the legislation was hailed as one of Albany’s most signifi cant reforms in decades—the beginning of the end for the state’s “Soviet-style bureaucracies” that have amassed$45 billion in public debt.

The centerpiece of the dense 25-page bill was the creation of the Independent Authorities Budget Offi ce, which replaced a similarly named offi ce that had existed with limited scope and responsibility since 2006. The new offi ce was given a host of new powers—such as the ability to issue subpoenas and remove authorities’ board member. It also was given a number of responsibilities, including the ability to audit authorities for potential fi nancial abuses, oversight of new lobbying regulations for authority board members and regulation of the sale

of authority land, among others.But the offi ce appears to have so far

fallen victim to the same budget woes that it was supposed to help alleviate.

Before the law took effect March 1, the offi ce had only seven employees. Paterson’s executive budget proposal would increase the offi ce’s budget modestly from $1.3 million to$1.8 million, and would increase the number of employees from seven to 11. Still, these increases would fall far short of what was promised in June 2009, when the bill was fi rst being seriously considered: a staff of a least 25 (others have suggested 40) and a budget of at least $4 million.

For now, though, the staff has remained frozen at seven, raising concerns among those who helped create the new offi ce.

“I can’t conceive how they’re going to do what they’re really supposed to do,” said Ira Millstein, the chairman of a task force charged with helping to implement the new law. “None of these things are easy. All of them are things that have never been done.”

The Independent Authorities Budget

The office appears to have so far fallen victim to the same budget woes that it was supposed to help alleviate.

New Authorities Budget Offi ce Could Be Swept Away By Lack Of FundingLack of money to pay for expanded staff threatens key component of reforms passed last year

about compliance with state law. In addition, until a new budget is

passed, the offi ce also cannot even hire a legal counsel to draft the regulations that will implement the authority reform law, Kidera said.

At an April 26 Assembly hearing, As-sembly Member Richard Brodsky, the sponsor of the authorities reform bill, grilled Kidera about the progress of his offi ce during its fi rst two months, asking how it was faring on the wide array of is-sues now under its purview.

Brodsky seemed unim-pressed with the progress.

“Is it fair to say that there’s substantial noncom-pliance with the act as we sit here today?” Brodsky asked Kidera.

In an interview, Brodsky said he felt the level of funding

of the offi ce was a “trivial” concern compared with others that he had raised at the hearing.

But Kidera said that most people involved in getting the offi ce up and running felt differently.

“If he thinks we can perform all the additional statutory duties with the budget that we have, I think he’s in the minority,” Kidera said.

The Independent Authorities Budget Offi ce is not the only offi ce struggling under the weight of the sweeping new law. The state comptroller’s offi ce is now also charged with reviewing any non-competitive contracts, signed by authorities, over $1 million, many of which are quite complex. Under the governor’s budget proposal, though, the offi ce’s staff, which is already charged with reviewing some 40,000 state contracts annually, is not expected to net any new employees, said Luke Bierman, general counsel for the comptroller’s offi ce.

The real consequence of the limited resources for both offi ces would be to limit the scope of the sweeping new law, said Scott Fein, an attorney who serves on the commission charged with implementing it. The 14 big authorities associated with the state will likely come under stricter scrutiny under the new law regardless, he said, but monitoring the hundreds of smaller local development corporations and industrial development agencies around the state will be impossible without more resources.

Millstein said that although not much thought was given to the funding of the offi ce before the bill was passed, it had arisen as the major issue in his mind now that the offi ce has been created.

“I went on blind faith that if we created an independent authorities budget offi ce,” Millstein said, “that someone would be wise enough to fund it.”

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City Hall: Your stop for New York City political news.

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THE CAPITOL MAY 10, 2010 11www.nycapitolnews.com

Opponents of the bill say there is no need to expand the already considerable scope of the Martin Act by giving these powers to trial lawyers.

In fact, Kathy Wylde, president of the Partnership for New York City—a busi-ness group that strongly opposes the measure—believes that the bill is being mainly pushed by the powerful trial law-yers’ lobby. Wylde said the bill is favored by the trial lawyers because its scope would give them a leg up in recruiting cli-ents for future class-action lawsuits.

“It would fl y to the top of the list of why employers would fi nd New York State unattractive,” she said.

Richard Binko, president of the New York State Trial Lawyers Association, said the group is supportive of the legisla-tion because it would “increase access to justice.”

Wylde also alleged that many unions were only nominally on board, lending their tacit support at the behest of Richard Winsten, a lawyer and a lobbyist for the fi rm Meyer, Suozzi, English and Klein, and who has a number of clients in organized labor.

Winsten, however, said Wylde was “in denial” and produced memos showing support of the bill by AFSCME and the International Brotherhood of Electrical Workers and NYSUT.

As for the future of the legislation this year, Winsten said the bill could be soft-ened to increase the low burden of proof required to fi nd wrongdoing by fi nancial institutions or to lessen the statute of limitations to fi le cases from six years to three.

But one indisputable fact, Winsten said, is that pension funds and their in-vestors should at least have standing to fi le lawsuits against fi nancial institutions, even if they weren’t granted all the pow-ers afforded by the Martin Act.

“There’s certainly enough probable cause that people ought to get a chance to get compensation for their losses,” Winsten said. “There’s more and more evidence ev-ery day that abuses occurred.”

[email protected]

BY CHRIS BRAGG

When thousands of union members marched on Wall Street to rail against alleged

abuses by Goldman Sachs and other Wall Street fi rms at the end of April, their primary focus was spurring the passage of the fi nancial reform bill currently in Congress.

But at the same time, local union leaders are also pushing to change state laws in New York that they say would make the fi nancial sector pay for the damage caused by the collapse of the country’s fi nancial markets in 2008.

In particular, unions are renewing efforts to pass a bill giving pension funds the power to sue investment banks for alleged wrongdoing under the expansive powers of the Martin Act, made famous by former Attorney General Eliot Spitzer.

Under current New York law, only the Attorney General has the power to sue investment fi rms under the act. But the legislation introduced last June by Assembly Member Richard Brodsky and State Sen. Eric Schneiderman would allow groups of institutional investors of over 500 people a six-year statute of limitations to sue for alleged wrongdoing using the Martin Act.

The once-little-known act, which gives the attorney general the broadest powers in the country to regulate

fi nancial institutions, was used by Spitzer to bludgeon fi nancial fi rms during his tenure.

Among the unions renewing the push for the bill is the Communication Workers of America Local 1180.

“Imagine people being accountable for their actions,” said Arthur Cheliotes, the union’s president. “Instead of cutting our

benefi ts, we should get our money back from the people who stole it.”

The Carpenters Local 747, the Plumbers Local 267 and the Roofers Local 195 in Syracuse had their pension and annuity funds decimated by the collapse of Bernie Madoff’s $65 billion Ponzi scheme. Yeshiva University and New York University endowment funds were also badly damaged. The state and city pension funds suffered their own heavy losses.

Under current law, though, these groups do not have standing to sue to recover these funds. Brodsky, the Assembly sponsor, called this a “loophole” in the existing law.

“If Madoff defrauded you, you could recover if you were an individual, but not if you were a pension investor,” Brodsky said.

Forty-eight other states have laws in some form allowing pension funds and other institutional investors to sue for losses due to fraud.

At the same time, though, none have

a law that would grant such considerable powers to these plaintiffs to pursue their cases as the Martin Act. These powers, which some have dubbed as Spitzer’s “Excalibur” while he was in offi ce and which were unearthed by current Attorney General candidate Eric Dinallo, include the plaintiff’s right to subpoena any document from anyone doing business in the state and to deny the right to counsel or the right against self-incrimination to defendants called in for questioning. Importantly, the Martin Act defi nes fraud more loosely than federal law does.

In Wake Of Goldman Scandal, Unions Push For Expansion Of Martin ActLaw that Spitzer made famous would be broadened to allow lawyers for pension funds to sue

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While driving from Albany back to the city one day in early May, State Comptroller Tom DiNapoli was caught

in a sudden thunderstorm. “It’s craaaaazy!” he said, stretching out

the word. “Lightning and dark clouds and wind!”

With a laugh, he added, “Typical for the mood in Albany at the moment.”

That mood could be a problem for DiNapoli, as he gears up for his fi rst statewide campaign to defend the offi ce, delivered to him by his former Assembly colleagues in time for him to serve almost a full term by appointment. He faces an independently wealthy challenger, an ongoing publicly damaging probe by Attorney General Andrew Cuomo and doubts within his own party about his ability to raise enough money to keep the seat in Democratic hands.

Not to mention very few voters seem to have heard of DiNapoli, much less have any idea what a comptroller is.

“People don’t know whether to pronounce it ‘comptroller’ with a P or ‘controller’ with an N,” he sulked.

No primary opponents have emerged, although former Gov. Eliot Spitzer was thought to be mulling a run, arguing that DiNapoli has not been aggressive enough with the shareholder power he had from

A Complicated Campaign For First-Time Comptroller Candidate

By Andrew J. Hawkins

TOM DINAPOLI:>>continued on page 14

BEAN COUNTDINAPOLI VS. WI

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>>continued on page 15

TER BLOW-UPILSON HEATS UP

The Great GOP HopeHARRY WILSON:

As Republican Comptroller candidate Harry Wilson sat answering questions at his campaign offi ce in Manhattan, he strained to speak over an old air

conditioner whining in the background. The walls of the small offi ce were almost completely bare and the skeletal space contained few amenities beyond an odd desk or chairs. Despite the racket caused by the air conditioner, the place was brutally hot.

At least in his campaign offi ce, the former hedge fund manager does not look like the fat cat caricature that Comptroller Tom DiNapoli’s campaign would like to project on him.

Wilson, 38, amassed a large enough fortune working for a series of hedge funds to retire in his 30s. But Wilson says wealth is relatively new to him: he is the son of a bartender and a textile worker, someone who emerged from a small town upstate to become the fi rst person from his family to graduate college before working odd jobs to pay for Harvard and Harvard Business School. He makes a point of saying that he fl ies coach, and both he and his campaign manager stay in cheap motels on the campaign trail.

“I’m entirely self-made,” Wilson explained. “I grew up in an entirely working-class family. The combination of the grace of god and hard work got me where I am today, and I think a lot more

By Chris Bragg

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“He’s got a job to do,” DiNapoli said, “and I have a job to do. We move forward.”

Cuomo has not accused DiNapoli of any wrongdoing, but has also avoided embracing him as a fellow Democrat. Quite the opposite: at the Democratic

Rural Conference, after his own speech, Cuomo stayed to hear Sen. Kirsten Gillibrand, but as soon as DiNapoli took the stage, the attorney general was out the door with almost the entire press corps on his heels. Adding to the problems: when Cuomo eventually does campaign for governor, Cuomo will likely tout his successes in rooting out corruption in the state comptroller’s offi ce, effectively sliming DiNapoli by proxy.

DiNapoli, on the other hand, would probably prefer voters ignore the issue completely.

Mark Benoit, DiNapoli’s campaign manager, dismissed the idea that Cuomo was trying to torpedo DiNapoli’s re-election.

“I don’t think Andrew Cuomo lies awake at night thinking about Tom DiNapoli,” Benoit said. “I have to take every rumor seriously, because that’s my job. But at the end of the day, I think a lot of it is overblown.”

“Obviously I’m a Democrat,” DiNapoli said. “But I’m a person that is beyond the traditional partisan gridlock that typifies Albany.”

the $130 billion in pensions he oversees as sole trustee. Spitzer’s candidacy never materialized, but his argument about DiNapoli’s failure to fl ex his potentially massive power to force reform on Wall Street has resonated deeply and widely.

Granted, DiNapoli leads his only declared opponent, former hedge fund manager Harry Wilson, by over 20 points and is racking up endorsements at a steady pace. He has 41 county chairs, dozens of unions and at least one former elected offi cial, former New York City Comptroller Bill Thompson. (DiNapoli’s campaign says more offi cial endorsements are forthcoming, and with closeness to Assembly Speaker Shelly Silver and many other state legislators, no one doubts that will be the case.)

But the Cuomo investigation has taken a lot of steam out of DiNapoli 2010, particularly at a time when state Republicans, desperate for a victory, see DiNapoli as their best, if not only, chance at recapturing a statewide offi ce.

The comptroller acknowledged that the ongoing investigation has made it diffi cult to keep things running smoothly.

“It’s been challenging at times,” DiNapoli admitted, “keeping the offi ce moving forward and not being frozen.”

DiNapoli would not address the par-ticulars of the attorney general’s investi-gation, nor comment on whether Cuomo, the expected Democratic nominee for governor, is willfully attempting to hurt his electoral chances, something that has been rumored in political circles.

DiNapoli’s strategy so far has been to blame his predecessor, Alan Hevesi, the disgraced former comptroller who has all but been implicated in Cuomo’s pay-for-play pension investigation. DiNapoli complains that he “inherited a mess” from Hevesi, who resigned in December

2006 after admitting to using a state employee to chauffeur his ailing wife.

“To the extent that there were some wrong things going on, I think it’s important that be investigated,” DiNapoli said. “As soon as we identify problems, I think they need to be corrected.”

Cuomo’s offi ce revealed for the fi rst time last month that it had begun to investigate investment deals made under DiNapoli’s tenure. The news about meetings between the comptroller, members of Global Strategy Group and other investors fi nally gave Wilson hard evidence to use in his uphill campaign.

Wilson has also hit DiNapoli on his close ties to Silver, calling the comptroller “Silver’s lapdog” and pushing him to cancel an Albany fundraiser hosted by the speaker.

DiNapoli refused, and it is easy to see why: as of January, he had $100,000 less on hand than he did in January 2009. While he still has $1.3 million in his campaign account, his fundraising has lagged behind other statewide candidates, pulling in just $474,000 during the last fi ling—less than half what each of the fi ve Democratic candidates for attorney general raised during the same period.

In part, DiNapoli has only himself

to blame, having imposed limits on his individual donations and returned checks from donors who do business with the state’s pension system. Each individual contributor is vetted by campaign staff before a donation can be cleared. Donations from labor groups, traditionally some of the biggest contributors in state races, have been curtailed. The process is long, tedious and necessary, DiNapoli says, if he is to restore credibility to the state comptroller’s offi ce.

A lifelong Democrat, he said he hopes voters will look past his party registration to view his management of the offi ce as non-partisan and not ideologically driven.

“Obviously I’m a Democrat,” he said. “But I’m a person that is beyond the traditional partisan gridlock that typifi es Albany.”

But Albany insiders are exactly those who make up the bulk of DiNapoli’s fan base. He served in the Assembly for over 20 years before ascending to the comptroller’s offi ce. He still elicits thunderous applause any time he comes near the Assembly chamber. Fellow Democrats commend him for keeping a low profi le during the roll-out of arrests and indictments resulting from the pay-for-play scandal.

“He’s not a big wave maker,” said Assembly Member Michelle Schimel, who has known DiNapoli for years and now holds his old seat. “But you don’t want our comptroller to be a wave maker.”

Translating his accomplishments as sole trustee of the state’s pension system presents another set of challenges. The pension is regularly rated among one of the best-managed by independent researchers, he says. And although the fund experienced a precipitous drop during the economic crisis, losing roughly $45 billion in 2008 alone, it has since bounced back, he said. Facing outside pressure to make changes following the arrest of several top Hevesi aides, DiNapoli banned placement agents, restructured the hedge fund investment program and increased oversight and transparency.

“If you look at our procedures and compare it to other states, I don’t think there’s any question that New York is in the forefront of how a pension fund is managed,” he said.

Critics say the opposite is true, that while DiNapoli has made much of his reforms, little has actually changed. They say fees to money managers, those that take a percentage to invest pension monies in high-risk private equity fi rms, has increased under his watch.

(A DiNapoli spokesman said that while it may be accurate that the number of money managers that do business with the fund has increased, it would be inaccurate to assume they are being paid more for their services.)

In particular, pension experts fault

>>continued from page 12

DINAPOLI


Tom DiNapoli is expecting the support of unions, the Democratic establishment and other powerful political forces.



WILSON


New Yorkers identify with that story—and want that story to be true of their kids—than that of a career politician who’s lived off the public his entire career and that’s brought the state to its knees.”

That would be his caricature of DiNapoli, who was fi rst elected to the Assembly in his 20s, and spent his entire career there until he was elected by the Legislature to fi ll the vacancy created by Alan Hevesi’s resignation.

Wilson cites his experience restructuring companies as a hedge fund manager as the perfect preparation to run the state’s $129.4 billion pension fund. And as a member of President Barack Obama’s auto task force that restructured GM and Chrysler, Wilson says there is no better preparation for reshaping the state’s dire fi nancial structure.

Still, Wilson’s Wall Street connections are sure to be a major talking point as the comptroller campaign unfolds: his status as a former partner at what the comptroller’s campaign is calling an “unregulated hedge fund” called Silver Point Capital, and his two years of employment at Goldman Sachs some fi fteen years ago.

In addition, a July 2009 New York Post article cites two anonymous sources saying Silver Point Capital forced Wilson out after a string of bad bets, an argument that if true could undercut Wilson’s argument that he has superior fi nancial expertise. The issue arose during Wilson’s work on the auto bailout, when some employees of Silver Point Capital, which was owed $600 million in debts from the auto industry, were apparently upset with the deal that Wilson helped engineer for them.

Wilson’s campaign said the story was “totally inaccurate.” This was echoed by a spokesman for the company, who said the story was untrue and that Wilson had left the company on friendly terms.

“He left Silver Point to spend more time with his family and pursue his longstanding interest in public service,” said Silver Point spokesman Adam Weiner.

Wilson faces other daunting challenges trying to win as a Republican in a state that rarely elects them anymore. The name Harry Wilson is so generic as to be instantly forgettable, which might contribute somewhat to his paltry 12-point showing in a recent Siena poll. Adding to the problems: the state GOP apparatus is a mess, Wilson is running on a message of paring down state spending that will likely make most unions eager to see him lose, and he has never held elected offi ce to give him any sort of a base.

Nonetheless, Wilson is circling the state, answering questions in considerably wonky detail. But for all the people who have reacted positively, many more people do not know or care to know what

“I think the public is in the mood for big changes, and for whoever is representing change,” Faso said.

One concern is that whoever is on top of the Republican ticket will get trounced by Andrew Cuomo. In 2006, Alan Hevesi won re-election easily despite being in the middle of a scandal due to Eliot Spitzer’s record-breaking victory. But even if that occurs again, voters may be paying unusual attention to the comptroller’s offi ce this year because of the state’s dire fi scal situation, said John McLaughlin, the Wilson campaign’s pollster.

“Arthur Leavitt and Ned Regan were from the opposite party from the governor,” he said. “When it concerns their money, New Yorkers are pretty cynical and pretty independent.”

Wilson’s own money is another major reason why he is generating so much optimism. He is expected to self-fund a signifi cant chunk of a campaign that is expected to cost somewhere between$5 million and $10 million. When Faso ran in 2002, he did well upstate but lacked the resources to buy much ad time in the New York City media market. Through personal funding and his Wall Street connections, Wilson’s campaign does not expect to have that problem.

So far, Wilson has shelled out money on personnel. While most campaigns retain a small staff until later in the campaign when contributions start rolling in, Wilson decided to self-fund the full staff of 10 (including part-time consultants) off the bat. He described the decision as something akin to providing venture capital for a start-up company, arguing that in order to be perceived as a serious candidate he needs to have a serious operation up and running.

The early spending has also allowed him to hire top Republican talent before other campaigns could, including McLaughlin as his pollster, former Gov. George Pataki’s 2002 campaign manager Adam Stoll, Westchester County Executive Rob Astorino’s fundraiser Christina Comer and communications consultant Bill O’Reilly.

A rapid-fi re press shop to respond to any DiNapoli-related news has been es-pecially crucial in particular, since he faces no serious primary opposition and his slow rollout of county chair endorse-ments has been largely overshadowed by the fi ght for the top of the ticket between Rick Lazio and Steve Levy.

One unknown factor is how much money Wilson really is willing to spend. DiNapoli’s campaign called out Wilson for failing to release his tax returns, hoping they would provide not only fodder to slough Wilson off as rich and out of touch but, more importantly, give the Democrats a more accurate indication of how deep Wilson’s pockets actually are.

Wilson promises he will release a tax return eventually. As for how much money he has raised so far, Wilson said that would come out when the campaign fi nance fi lings are released July 15.

Wilson’s supporters also believe that Wilson’s experience restructuring companies and his work as a key fi gure on Obama’s auto task force will make for a compelling case. Following the fi nancial collapse in 2008, Wilson e-mailed Steve Rattner, who was heading the auto industry task force appointed by Obama. Though they had never met, Rattner was so impressed by Wilson’s

“Arthur Leavitt and Ned Regan were from the opposite party from the governor,” said John McLaughlin, the Wilson campaign’s pollster. “When it concerns their money, New Yorkers are pretty cynical and pretty independent.”

it is the comptroller actually does. Getting them to care, and to cross party lines, will be an uphill battle.

Almost everyone agrees that Wilson is Republicans’ best, and perhaps only, hope of winning a statewide offi ce this year, though some hold out hope for a strong showing from Dan Donovan in the attorney general’s campaign.

Former Assembly Minority Leader John Faso, a Republican who narrowly lost a bid for comptroller in 2002, echoed that because of national trends and disgust with Albany, the political climate this year offered an even more favorable environment for a Republican candidate than in 2002, when George Pataki was at the top of the ticket.

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So far, Harry Wilson is the only candidate this year to have the united support of the Republicans, Conserva-tives, Ed Cox and Mike Long.


New York’s single-trustee system of governance that gives DiNapoli complete control over investment strategy.

“You have a faulty governance scheme to begin with, impacting millions of people’s lives,” said Edward Siedle, president of Benchmark Financial, a Florida-based fi rm that audits pension plans. “I haven’t seen DiNapoli do anything that would suggest to me anything other than political papering over of the problems.”

Siedle, who was a testifying expert in the Bernie Madoff trial, says the New York pension fund raises many red fl ags.

“They’ve got too many money managers,” he said. “They’re migrating into non-traditional, risky investments. They shouldn’t be doing that. Fees need to be cut, not go up. They’re just squandering taxpayer money.”

Siedle says a pension board, with representatives from each of the state’s major retirement systems, would ensure a diverse array of voices is heard before investments are made. But others disagree, pointing to New York City’s board-governed pension system, which they say routinely underperforms when compared to the state.

Elizabeth Lynam, deputy research director at the Citizens Budget Commission, said DiNapoli deserves credit for ending a lot of the bad policies

of previous years. “He’s tried to rout out some of the

insider peddling,” she said, “and make it a more transparent and equitable process in terms of selecting the investment tools for the system.”

Lynam said more protections are

needed to completely buttress the system from the kinds of kickbacks and bribery that marked Hevesi’s tenure.

“Can I say that the [reform] package he’s put in is suffi cient? No,” she said. “But he has defi nitely made it a priority.”

Of course, DiNapoli has not completely broken with the past. Like his predecessors, he has lobbied the Legislature to lift the limit on private

equity investments, arguing that those types of investments can yield strong returns.

More so than his stewardship of the pension system, DiNapoli said, he thinks voters will reward him with another term in offi ce based on his commitment to exposing waste and fraud in state

government. Over the last three years, DiNapoli has wielded the audit function of the offi ce with broad strokes. He has exposed misspent millions by school districts, stadium builders and insurance companies. He even audited a branch of Cuomo’s offi ce that acts as a collection bureau for the state.

But DiNapoli, who is often praised for his geniality, is hardly the attack dog comptroller that some were hoping for in a time of shrinking state budgets. Republicans have blasted him for ignoring bloated state authorities like the Metropolitan Transportation Authority. (He announced an audit of the transit agency minutes after several GOP lawmakers held a press conference

criticizing him for failing to do so. They said too little, too late.)

His plans for the next term are a mix of new ideas and more of the same.

Investing in clean technologies and emerging industries are high on his list of priorities, as well as bracing the pension system for the expected tide of retiring baby boomers. He echoes Lt. Gov. Richard Ravitch’s call for comprehensive budget reform, with the hope that his own ideas

will get a fair hearing. He wants to push for campaign fi nance reform, especially public fi nancing for the comptroller’s offi ce.

“I want to be part of the process of change, in terms of how we manage our budget, how we manage our debt,” he said.

Still, he has six months between now and the election, in which anything could happen. No one thought Alan Hevesi, under the cloud of Chauffeur-gate and other mounting scandals, would defeat Republican Chris Callaghan by 17 points, only to resign from offi ce a month later. With Cuomo’s investigators continuing to prowl through the pension records, tension is high within the comptroller’s offi ce.

For now, DiNapoli said he is focused on the voters. He realizes nearly two-thirds have no idea who he is. When asked to summarize the comptroller’s offi ce in one sentence, he struggles to fi nd a concise way to describe his job, to condense the hundreds of billions of dollars in pension fund investments, the hundreds of audits and fi nancial reports, the thousands of state contracts and millions in fees.

“It’s the offi ce to, um,” he said, then paused as he chose his words carefully. “It’s the offi ce to safeguard the, uh, the interest of taxpayers, and to focus, to focus, uh, state decisions on the long-term, what will benefi t the state on a long-term basis.”

He laughed. “I never have to be that brief!”

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résumé that he named him as the lone Republican to the task force. Wilson, who eventually became a leading player in the restructuring of General Motors, said he would use this experience to connect with voters about the import of the poorly understood comptroller’s offi ce.

“Everyone knows General Motors,” Wilson said. “Everyone knows what the problems were. Everyone in their family used to have a GM car and a lot fewer people have them today. Both entities have bad leadership that refused to make tough choices, that let costs spiral out of control, and that ultimately led to GM going bankrupt and New York on the brink of fi scal insolvency.”

When Wilson began digging into General Motors’ business model last year, he said he saw a company that had a solid line of products in the pipeline to turn around its fortunes in future years, but which had been crippled by out-of-control labor and production costs.

Similarly, Wilson said as comptroller he would vastly expand the scope of the offi ce’s use of auditing powers to initiate a top-to-bottom audit of the state fi nances, using the offi ce’s subpoena powers to focus in on the biggest areas of spending,

such as education and Medicaid. As comptroller, Wilson said he would

appoint an independent “SWAT team” of fi nancial experts—similar to the task force appointed by Obama—to look into the state’s fi nances. He said that DiNapoli’s audits had been too narrow, focusing on audits of local governments that represent a much smaller portion of the pie.

“When you look at the scope of what he’s uncovered, a few million dollars here and there, relative to the size of the fi scal mismanagement in Albany, which numbers well into the billions and maybe even the tens of billions of dollars, I think it’s far too narrow and far too small.”

He also accused DiNapoli of launching politically motivated audits of charter schools and singling out areas where there are Republican offi cials for review. Wilson maintains that DiNapoli cannot be independent of special interests that run up state spending, and especially not independent of Assembly Speaker Sheldon Silver, the man most responsible for his selection as comptroller. He also points to comments by former Gov. Eliot Spitzer that DiNapoli was “completely unqualifi ed” for the job, and the screening panel that did not put DiNapoli among the top three most

qualifi ed candidates for the position he would eventually get anyway. As the race goes forward, Attorney General Andrew Cuomo’s continuing investigation into the pension fund could potentially upend

the dynamics of the race, though for now the issue remains somewhat on the back burner.

Wilson acknowledges that he will not have any direct power to change the Legislature’s behavior simply by releasing audits. This is one reason why DiNapoli, as a long-time legislator, is arguing that as someone who has long been in

government, he understands the process better than Wilson.

“Wilson’s never run for anything or worked across party lines,” DiNapoli said. “I have a tested, proven record in

that regard.”Wilson, meanwhile, said

taking a non-partisan, data-driven approach, like that which he has used to restructure companies, will make him appear an honest broker in accessing the state’s fi scal problems. He notes that while he favored bailing out GM, he opposed the bailout of Chrysler because he though the company was too far gone to save—an indication, he said, of this data-driven independence.

Wilson said this is what has motivated him to leave the cushy corporate life for a run at an offi ce that most people have

never heard of, in a state that some think is ungovernable.

“The worst thing is not losing. The worst thing is winning and not being able to have an impact and wasting four years of my life,” he said. “There are 1,461 days from the time I’m inaugurated to get it done.”

[email protected]


DINAPOLI


WILSON

Wilson promises he will release a tax return eventually. As for how much money he has raised so far, Wilson said that would come out when the campaign finance filings are released July 15.

“He’s not a big wave maker,” said Assembly Member Michelle Schimel, who has known DiNapoli for years and now holds his old seat. “But you don’t want our comptroller to be a wave maker.”

THE CAPITOL may 10, 2010 17www.nycapitolnews.com

By Andrew J. HAwkins

If the teachers’ union has its way, the control of State Senate this year will be determined by the debate

over the role of charter schools in New York.

The New York State United Teachers and its powerful city-based local, the United Federation of Teachers, are pledging to oppose any legislator or candidate for statewide office who

voted to lift the cap on charter schools. Meanwhile, advocates for the schools are pooling their money in a bid to keep charter-friendly pols in office.

But the union brags that it can provide candidates with a breadth of support that charter advocates will find difficult to match, given the money and manpower behind the 600,000-member union.

Down-ballot races are where union support really begins to pay off, said NYSUT president Richard Iannuzzi, explaining his bafflement at the Democrats’ insistence on pushing the cap-lifting bill so close to the election, especially when many of the same lawmakers stood in support of a much more union-friendly bill in January.

“The very principle these people were standing for three months ago—they seem to have walked away from it,” Iannuzzi said. “Someone needs to hold them responsible for it.”

The union will not make the bulk of its endorsement decisions until late summer, but officials are expecting to be heavily involved in every race, from governor on down.

Andrew Cuomo is seen as a likely lock for an endorsement, as is State Comptroller Tom DiNapoli. The race for attorney general, though, is a toss-up, with both Sen. Eric Schneiderman and Assembly Member Richard Brodsky viewed favorably by the teachers’ union. Sources close to the union say that if the primary came down to those two candidates, the teachers may decline to endorse. If both candidates drop out, as some speculate will happen, the union’s position is even harder to predict.

Decades ago, the teachers’ union was highly engaged in local races, staffing phone banks 24/7 and dispatching volunteers into the field to go door-to-door for their endorsed candidates. As the union’s political action committee VOTE-COPE (Voice Of Teachers in Education, the Committee On Political Education) ballooned in size, though, the union scaled back its grassroots efforts in favor of becoming more of a “checkbook

union,” observers say. This year, with charter schools and

layoffs at the forefront of the agenda, the union’s political strategy is likely to shift into overdrive.

“They’re under attack,” said Norman Adler, a political consultant with a long history of work for unions. “Most unions do not do the hands-on stuff you see from 1199 and 32BJ… But that’s about to change.”

The union normally stays out of primary races unless the candidates have a clearly defined stance on the issues, namely on charter schools. And the marquee primary this year for the union and pro-charter groups alike is shaping up to be Harlem-based Sen. Bill Perkins’ re-election effort. Perkins, an outspoken critic of charter schools, has been working

in tandem with the union to uncover financial abuses at charters. Political consultant and charter proponent Basil Smikle is targeting his seat in a primary this year, with several pro-charter groups expected to be key contributors to his campaign. Union officials said they are not only likely to max out donations to the senator’s re-election campaign, but will also dispatch members to his district to help Perkins retain his seat.

“Fifty people on 50 phones for 50 days heading into an election, that’s what they all want,” Iannuzzi said. “That’s what they get when they do the right thing. It’s not about money, it’s about boots on the ground, and that’s what we provide.”

Pro-charter PACs are hoping to be just as active this year, and many supportive pols are feeling more emboldened to challenge the powerful union. Groups like Democrats for Education Reform are already up with ads blasting the teachers’ union for its opposition to charter schools or lifting the cap to qualify for federal Race to the Top funds. The group and other pro-charter organizations are hoping to spend upwards of $10 million this year, culled from prominent charter backers in the worlds of finance and politics, in support of their preferred candidates.

“A lot of people within the charter school world understand now better than ever before: if you can’t win the political fights, you can’t run the schools,” said Joe Williams, executive director at Democrats for Education Reform.

[email protected]

NYSUT Threatens Electoral Action Over Charter Support

“Fifty people on 50 phones for 50 days heading into an

election, that’s what they all want,” Iannuzzi said.

“That’s what they get when they do the right thing. It’s not about money, it’s about

boots on the ground, and that’s what we provide.”

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By NaNcy GroeNweGeN

When the discussion in Al-bany these days turns to the state workforce, the topic typi-

cally is the workforce’s size and cost. I predict the discussion very soon will turn to the knowledge, skills and abilities of that workforce.

A real challenge to New York State’s capacity to deliver the services its citi-zens need will arrive, hopefully not before we’ve prepared for it by making state gov-ernment more open to importing talent, ideas and perspectives from the outside.

This impending challenge is the result of a complex interaction of the demo-graphics of the current workforce, the pressures that the financial crisis of the past two years have exerted on everyone and the constraints that various laws have imposed on the State hiring system.

New York State hired extensively dur-ing much of the period when the baby boom generation was entering the work-force. The generations that followed found quite a different public-sector job market. Revenues had contracted and government hiring slowed significantly, producing a state workforce that was far from evenly distributed among the vari-ous age cohorts.

For several decades, that meant the state enjoyed the benefits of an experi-enced, productive and stable workforce. That is changing, and rapidly. In the execu-tive branch agencies that the Department of Civil Service oversees, there have been more than 37,000 retirements in the last seven years from a workforce that num-bered 165,184 last January. Another 31,000 are eligible to retire in the next five years.

As baby boomers were a high propor-tion of the new hires 30 and 40 years ago, they are a high proportion of those who have recently retired or are preparing to retire. Loss of their expertise and expe-rience as managers, professionals and technicians will leave a void that is larger than normal because their logical suc-cessors—and sometimes the successors’ successors—are also preparing to retire. This lack of a “back bench” alarms many managers who wonder how they will con-tinue to provide services of the kind and quality that citizens have rightfully come to take for granted.

While the state workforce has many highly competent younger workers ready and eager to step up to the next level of responsibility, the reality is that they are next in line to assume responsibilities two and three levels beyond that. Some simply are unprepared.

The economic crisis confronting New York State this year—and probably for at

least the next several years—has necessi-tated the hiring freeze that Gov. David Pat-erson imposed in August 2008. Selected hir-ing and promotion continues, however, for positions that are critical to public health and safety, to essential agency operations or to ensuring revenues due the state are collected promptly and spent wisely.

It only makes sense under any circum-stances to search out the best talent you can find and not artificially limit the range of your search. It makes extra sense to-day for two reasons: because every single hire or promotion must return maximum value, since they are so few, and because the state of the economy has produced a large pool of skilled and experienced individuals who have lost private-sector jobs and/or are willing for the first time to consider government work. These work-ers have the assets that would enable them to step in and replace the retiring baby boomers with hardly a hitch.

But in too many cases, this state’s sys-tem shuts them out, unless they are will-ing to start at entry-level responsibilities and salaries far below what they deserve. A web of laws and rules and practices has grown up over the years to limit the com-petition for many mid- and upper-level positions to those who already work for New York State. These current employ-ees shouldn’t fear an open competition for these positions. They will always have the advantage of familiarity with the state system and, perhaps, familiarity with the very programs that are the basis for the competitive exam.

New York State cannot afford the luxury of turning away talent in order to protect the interests of a relative few. The Legislature must recognize this as well and join with the administration in a seri-ous discussion on the future of the state workforce.

Nancy Groenwegen is president of the Civil Service Commission and commis-sioner of New York State Department of Civil Service.

ISSUE FORUM Unions & LaborState Government Should Cast A Wide Net for Talent

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Working With:• NY City Department of Transportation• NY City Metropolitan Transit Authority• Triboro Bridge and Tunnel Authority

Kieran Ahern • President • Dan O’Connell • General Counsel

• NY State Department of Transportation• The Port Authority of NY/NJ• NY State Bridge Authority


ISSUE FORUM Unions

By AssemBly memBer DAve TownsenD

On April 5 an underground explosion at Massey Energy’s Upper Big Branch Mine killed

29 employees and forced West Virginia officials to re-examine long-held assump-tions about mine safety in their state. The tragedy exposed a system in which safety

violations went unheeded and workers operated in a dangerous environment with too little information. We stand to-gether with our West Virginia friends, even as New York works to strengthen our own workplace safety laws. As rank-ing member on the New York State As-sembly’s Labor committee, I understand the progress we’ve made in the Empire

State and the challenges we still face in securing a safer environ-ment for all our workers.

My title as ranking member of the labor committee is the second such appointment I have enjoyed since being elected to the State Assembly in 1990. During this time I have worked with numerous labor

Getting New York Workers’ Safety Right representatives through-out New York State. I have addressed union member-ships at conventions, be-friended a myriad of state-wide union officials, and collaborated with union and business representa-tives in crafting legislation that balances labor inter-ests with the demands of

competitive enterprise. I have even gone out into the field to

witness conditions firsthand. I have been dedicated to bettering workers’ rights and employer relations. Time and again, as a former member of the Laborer’s Interna-tional Union, president of the New York State Deputy’s Association and president of the Oneida County Deputy Sheriff’s Benevolent Association Collective Bar-gaining Unit, I have endeavored to serve union members effectively. My 20 years representing the people of Oneida and Oswego counties in the state Assembly have only added to my regard for and un-derstanding of working men and women.

In 2009 I helped to pass a new law designed to protect those who work around high-voltage lines. The purpose of the legislation was to correct industry practices and standards that threatened utility employees daily. High-voltage lines present various hazards, including death. The law I joined my Assembly colleagues to pass was the first permanent change to these workplace safety standards in 35 years. Now, with fewer dangers and improved guidelines, the safety of workers and the standing of management has been enhanced. Another bill that I supported from the start would have required the state Department of Labor to study workplace environments and their consequences. Every day, certain workers are subjected to workplaces that threaten their ability to complete their jobs safely and in a timely manner. Even though this measure was ultimately vetoed by Gov. David Paterson, I remain committed to keeping the issue of hostile work environments and their impact on employees at the forefront of the labor committee’s discussions.

I have had a relationship with unions and their members in one form or anoth-er since the 1970s. During this time I have been proud to represent the interests of working men and women; my resolve to stand up for the basic rights of these hardworking New Yorkers has only been strengthened during our economic reces-sion. As lawmakers, we must continue this commitment into the future. For union supporters, enhancing workplace safety should remain part of this essential mission of fairness and progress.

Dave Townsend, a Republican rep-resenting parts of Oneida and Oswego counties, is ranking member of the As-sembly Labor Committee.

77777151515152323232323232323

Richard C. Iannuzzi, President

Representing more than 600,000 professionals in education and health care

www.nysut.org

New York State United TeachersAffiliated with AFT • NEA • AFL-CIO

www.nysut.org

We’ve faced tough times before — including the Great Depression and two world wars. And, like ourparents and grandparents before us, we’ve worked hard to build a better future for our kids, the next generation of New Yorkers, a future made strong through public education.

Yes, times are tough — we’ve already lost more than 5,000 education jobs over the past year. Further cutsto education are the wrong way to go.

Gov. Paterson’s proposal to slash $1.4 billion in education funds would force schools to lay off educators,eliminate programs and derail the substantial progress students have made statewide. The plan would alsofurther burden local property taxpayers at a time when they can least afford it.

Hope for the future starts in our public schools. Urge legislators to do the right thing. Reject education cuts.

OUR HOPE FOR THE FUTURE ... PUBLIC SCHOOLS


Gov. David Paterson sparked a war with the public employee unions when he announced in late April that he would seek a one-day-a-week furlough for state workers. For months,

the administration has tried to extract about $250 million in labor reduction costs from the unions, but was rebuffed. Paterson was taking a page from California Gov. Arnold Schwarzenegger, who began furloughing state workers in early 2009 to address the

CALIFORNIA:Total state workforce:358,000, including university system (238,229 without)Number of employees furloughed:238,000 Proportion of state workforce furloughed:66.5 percentExempted: Highway patrollers, state fi refi ghters, small pockets like the8,000-person department that runs workers’ comp program. Not exempted: Prison guards, law enforcement, health workersSize of furlough cut: 15 percent (3 days/month)Number of furlough days in past year: 40Estimated savings:$2.22 billion for all funds. $1.3 billion for general fund. (For fi scal year July 1 2009 to June 30 2010.) For 17-month period, Feb ’09 to June ’10, total savings are $3 billion.

(As of 5/1/2010)Source: California Department of Personnel Administration

NEW YORK:Total state workforce:roughly 200,000, including SUNY and CUNYNumber of employees to be furloughed:about 100,000Proportion of state workforce furloughed:roughly halfExempted: Workers whose salaries are 100-percent funded by federal money, or who work in public health or safety, such as state police, corrections offi cers, nurses and mental health workers. Management-confi dential level employees are also exempted because they did not receive a raise this year or last year.Not exempted:Other executive branch employeesSize of furlough cut:20 percent (1 day/week)Number of furlough days in past year:N/AEstimated savings:$300 million/week. The Public Employees Federation puts it at$39 million/week

(As of 5/1/2010)Source: New York State Budget Offi ce

state’s massive budget shortfall. Many unions have sued, arguing the governor has overstepped his authority by ordering state workers to take three days off a month without pay. Paterson’s plan is not quite as extensive as Schwarzenegger’s, but there a number of similarities. Here is a breakdown of each state’s furlough plan, which workers will be effected and how much savings each state expects to see.

THE CAPITOL may 10, 2010 23www.nycapitolnews.com

TC: Do you think Rick Lazio will be the nominee?JM: Yes. I’m already out for Rick Lazio. I came out for him, I think I was one of the first, and I think he will be the victor. I do not think he’s going to be overrun by Steve Levy. Look, I’ve known Steve Levy for a long time and I like Steve Levy. I don’t think he’s a bad public official, but he’s a Democrat. He’s got all the Democrat criteria. He’s done it well for all these years. That’s what makes Democrats different from Republicans. Now he sees a Republican year coming along, he doesn’t get what he wants out of the Democratic Party, so he’s going to pick up his marbles and run over to the Republican Party and think we are going to take him as the leader of our party? Not so. Not going to happen. This is a Democrat no matter how you clothe him, no matter how you dress him, he is a Democrat and he’s going to stay that way. Frankly speaking, let me talk to any leader, “Do you really think he is going to know you from Adam the day after election day if he were to win and you were to call him?” The answer is, he wouldn’t know you from a hole in the wall. You might say that’s good, that’s bad. Whether it’s good or it’s bad, it’s not what makes politics move around. And if I tried to tell you something, you’d know it was bullshit anyway, so why even try? Do you agree with me?

TC: But what if Steve Levy becomes the nominee?JM: If he becomes nominee then we inherit a whole new group of problems that, frankly, I don’t think are surmountable in this race this year.

TC: Nassau DA Kathleen Rice—the only countywide official your party did not beat last year—is now running for attorney general on the Democratic side. What is your take on her? JM: Excellent district attorney. I’m not supposed to say these things, but an excellent DA. As an attorney for 41 years, I can tell you, give me someone who’s got some ideas before you trash the ideas. Maybe I got a little Democrat in me too from the time I lived in the city, but I’m not looking to trash ideas before they have a chance to be screened and see what’s going on. The few times I’ve been with Kathleen Rice, she’s impressed me very favorably. In my opinion she will win that seat.

—David [email protected]

The Capitol: Nassau Republicans have had a massive turnaround. What do you make of it?Joe Mondello: It hit all at once. I was thrilled about it. Because in my opinion, had Westchester County taken all of their money and put it into their elections last year, they would have won more than just their county executive. Because I think that the area was ripe for Republican wins, as was Nassau County. We took very much advantage of it—I spent almost every dollar we had. I spent all of our money here. Of course, I’ve got no regrets because we are not in the profit-making business here. Money for the sake of money means nothing. Money is raised for the sole purpose of electing Republican candidates.

TC: But why did the Republicans struggle in Nassau for a while?JM: The demographics have changed here in Nassau County. The people from the city have moved out here as Democrats. And I’ve found it takes them a little bit of time to get used to the Republican way of living.

TC: How does that square with your time as state chair, given the way your time in that job ended last year?JM: It certainly was because I had the three worst years as state chairman. I think I did as well as I could have done in those three rotten years that I had. I raised $7 mil-lion. I put the party back on its feet as best I could, from a financial standpoint. Nobody ever gave me any credit, but I supported all five county executive races that won while I was state chairman. I had it coming back to where I really thought, after this year’s dinner, we would have been really on our way back from a financial standpoint, which would have been one less thing we would have had to worry about. And when you don’t have that to worry about, you would be surprised how much more comfort-able candidates feel coming to you, when your house is clean, when your house is solidly on a good base. So that was my plan all along. I would not have handled things the way they are being handled currently.

TC: Meaning what exactly?JM: I have to watch my words. I do not believe at the current time that the party is being handled well. It needs leadership that will serve upstate as well as downstate, and all individuals equally.

TC: What will it take for the party to come back into being a force in New York State?JM: Under the current leadership, it would take the county

chairs developing a strength and a fortitude that is going to allow them to stand up and be counted on their real feelings concerning the growth of the Republican Party.

TC: Do you feel like you were chased out?JM: When I was getting out the answer was: absolutely not, I didn’t feel that way at all. After I got out, when I found out about certain calls that had been made and certain wheelings and dealings that I had intentionally stayed away from, I felt that I had been used and abused. So the answer to that question, and I’m not supposed to say that, is yes. And did I like that feeling? No. Because I had never been chased anywhere.

TC: It’s late in the day—do you think that the GOP can still form a strong statewide ticket for every race?JM: I think it’s going to be a stronger ticket than you think it is. … I should have been smart enough to realize that it will evolve and the cream will come to the top, and you will see that happen. Take Bruce Blakeman. They said the same thing about Al D’Amato when he ran in 1980. How could this guy ever win? You watch Bruce Blakeman. Bruce Blakeman is a great campaigner. Yeah he’s my guy, he always has been my guy and I’m very, very fond of him. But he’s a great campaigner and he’s been all over the state and it wouldn’t surprise me at all to see him win. Would it surprise you? He doesn’t buckle to anything. He’s a strong guy. I almost saw him buckle when his wife went with Paul McCartney, but no, he held his own.

TC: What is your take on the governor’s race?JM: I think it could be handled more efficiently. I think it could have been handled more intelligently, in a better way.

Stampeding Back

Back Forth

Back & Forth

Back & Forth&

& &

&

Blue JayW

hen Joe Mondello was squeezed out as state Republican chairman last year, his reputation was in shambles. The once-powerful head of the mighty Nassau County Republican Party had stood watch as the GOP got swept out of power in New York, losing the governorship and, critically, a marginal State Senate seat. Things were even worse for Republicans in Nassau, with the whole

county going Democratic. But now that he has returned home to Long Island, the Nassau County GOP is, by all accounts, back. Last

fall, Ed Mangano stunned the political world by ousting Democrat up-and-comer Tom Suozzi from his job as county executive. The Republicans retook the county legislature. And they are hoping to make further gains this fall.

The Capitol talked with Mondello about the state of the state GOP, how things turned around in Nassau and his feelings about his successor Ed Cox in the county headquarters in Westbury, while soft, big band jazz music played in the background in his Nassau office—currently, he gloated, under renovations.

What follows is an edited transcript.

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“When I was getting out, the answer was: absolutely not, I didn’t feel that way at all. After I got out, when I found out about certain calls that had been made and certain wheelings and dealings that I had intentionally stayed away from, I felt that I had been used and abused.”

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New York State trial lawYerS aSSociatioN

Protecting New Yorkers Since 1953

A message from the New York State Trial Lawyers Association Richard S. Binko, President132 Nassau Street New York, NY 10038 Tel: 212-349-5890 www.nystla.org © 2010 NYSTLA

What Would Cars Be Like Without the Civil Justice System?

Gas TanksSeveral car manufacturers, includ-ing GM and Ford, designed defective gas tank placement, which resulted in fires and explosions even in minor collisions. As a result of litigation, gas tanks are now universally located within rigid frames.

Door LatchesFord’s own engineers identified the prob-lem with its “paddle-style” handles, which allowed the doors to accidentally open in collisions. But rather than fix the design, Ford covered up the problem through red tape, until held accountable in court.

Electronic Stability ControlThe popularity of SUVs eventually brought to light the stability problems of certain models. Ford’s Explorer, built on the already troubled Bronco II frame, experienced a rollover rate more than twice that of other SUVs. One result of litigation on SUV rollovers was an increased emphasis on the development of electronic stability control.

Air BagsAuto manufacturers have been develop-ing air bag technology since the 1950s, yet were extremely slow in installing it. By 1988, only two percent of new cars came equipped with air bags. Courts found that manufacturers knew full well their cars were safer with air bags and that many lives could have been saved. Eventually, manufacturers were forced to install air bags in all cars.

Illusory ParkFord and Chrysler were two manufactur-ers that experienced systematic problems with transmissions that slipped out of park and allowed their “parked” cars to roll away. In one instance, a pregnant woman was killed after trying to save her four-year-old daughter in a parked minivan that rolled away. Ford eliminated the problem after being held responsible twice in court. Chrysler ignored the problem against its own engineers’ rec-ommendations, until finally litigation and regulatory investigations forced them to recall over a million affected vehicles.

Power WindowsAs power windows became more common, so did deaths associated with them. Children were especially vulnerable through accidnetal depression of rocker-style window switches. The inexpensive solution, a lift-up style switch, was ignored by several manufacturers in order to cut costs, but litigation eventually forced universal acceptance of the safer switches.

TiresTire manufacturers from Firestone to Goodyear tried to cover up problems with defective tires and have been held accountable in courts. Firestone’s defective tires caused 271 deaths, and the resulting litigation brough tires and their manufacturers under increased scrutiny.

Side Impact ProtectionWhen a police officer was left paralyzed by a low-speed, side-impact collision, a court held that the absence of side protection was a design defect. Now all cars are designed with rigid side-impact protection.

SeatsSafety engineers call the prevalence of weakened seats the “most egregious, widespread defect to be found.” Weak seats can collapse in even low-speed impacts and kill rear passengers. With-out adequate regulatory standards, only court cases were able to highlight manufacturers’ negligence and force them to install stornger seats in all cars instead of just certain models.

Seat BeltsCourt cases went a long way in highlight-ing the dangers of inferior seat belts, or no seat belts at all. One example was Chrysler’s defective Gen 3 seatbelt, installed in more than 14 million cars and proven to unlatch in accidents. Both seat belts and seats themselves were rede-signed in response to litigation.

Roof CrushVehicle manufacturers, particularly makers of SUVs, had long known roof strength was a critical weakness during rollovers. Without adequate regulatory standards, it was only litigation that forced manufacturers to behin strength-ening roofs.

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The May 3,2010 Issue of The Capitol

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Transcript of The May 3,2010 Issue of The Capitol