Mikeonomics

When Michael Bloomberg was sworn in as mayor outside of city hall four years ago, the city's first billionaire mayor footed the bill for a peanut butter and jelly reception. The message: there would still be a free lunch, but it wouldn't be as tasty as it had been.

Unions, developers, civil service employees and even professional staffers were going on a diet, like it or not. And they didn't.

"We will not be able to afford all that we want. We will not even be able to afford everything we currently have," Bloomberg said, as we-the press corps, the powers-that-be and those there for the free lunch-huddled under itchy wool blankets.

As if it wasn't cold enough already, the mayor went on: "I pledge to reduce staffing in the Office of the Mayor by 20 percent. And I hereby challenge the Comptroller, Public Advocate, Borough Presidents and City Council to do the same."

Shivering jaws opened long enough to emit audible boos.

For all the jeering, though, no one wanted to be the first to cede the moral high ground of shared sacrifice so soon after the towers fell, with the smolder still in the air.

We were all cold, hungry and hung over from a morbid New Year, but many felt Bloomberg's austerity conveyed a sense of hope and perseverance. His words gave us a reason to hope that he intended to renew the city's possibilities: to reinvest the city with a sense of its future, and to protect that dream from those with too much invested in the present arrangements to give a damn about it.

He elaborated on that promise in his first state of the city speech, when he pointed out that the city's payroll-1/7th the size of the federal government's, excluding the military-was unaffordably large. Which is true-does anyone feel like our level of service is in any way as exceptional as the taxes we pay for them? The beneficiaries of this system had a tough 90 seconds there, before Bloomberg preemptively disarmed by announcing that there would be no layoffs (and, by extension, no bargaining leverage for the city). This was the moment when the post-9/11 window to ask for and receive sacrifices for the good of the city closed.

With crime no longer out of control, though, New York has gotten by on pushing debts into future years, finagling the numbers and riding a wave of real estate speculation most directly tied to the drop in crime. After all, if you can buy more space for less money in the city without fear of being robbed, attacked or worse, why wouldn't you?

But everyone knows-and several prominent state and city officials are now openly admitting, at least on background-that the city can't afford the fiscal promises it makes in good times once the economy slows down.

(Stop humming Leonard Cohen now.)

The billionaire businessman with less appetite for confrontation than his predecessor, though, has chosen to implement marginal improvements like increasing the efficiency of the workforce rather than take it on directly, and face all the political theater that would entail.

Almost four years after those promising and abandoned speeches, the city workforce is still as oversized. Bloomberg's appetite has grown, even as the willingness to sacrifice has evaporated. When opening a campaign office in Queens, he served up bread sticks wrapped in prosciutto with fresh mozzarella along with $400 tax rebates to homeowners. He hinted that dessert would be a "substantial" pay raise for the city's 80,000 teachers.

To be fair, this is how Gotham's mayors have long played the game, making promises in good times and election years that must be paid for when things tighten.

Little has changed since Mayor Abe Beame came to Albany in the midst of the city's mostly self-created fiscal crisis, when we nearly went bankrupt, and told state lawmakers, "I do not propose to permit our fiscal problems to set the limits of our commitments to meet the essential needs of the people of the city." The city's payroll at the time was about 340,000. It's still well over 300,000. And that's not to mention the more than 100,000 pensioners, most of whom receive far more generous benefits than they would have if they'd been employed in the private sector.

We know Bloomberg knows the problem - remember, it was one of the first things he addressed as mayor. It quickly became one of the first things he abandoned as mayor, along with his campaign promise to not raise taxes.

As things stand now, the mayor has pushed each year's problems back into future fiscal years. Conveniently, these years begin after the mayoral election is decided. The result is that the city simultaneously has a balanced budget, as required by law, and a nearly $4 billion hole to plug in the coming fiscal year. With the state facing fiscal problems of its own, we're one disaster away from a Disaster.

With the mayor's closest appointees muttering about insolvency, it's peanut butter time, right?

It is for rookie cops, who will make $25,100 for their first six months in order to pay for a 10.25 percent pay hike for their more senior colleagues.

But mostly it's prosciutto and mozzarella.

Payments to the New York City's retirement system, which was $615 million in 2000 went up four-fold to $2.4 billion in four years.

Goldman Sachs is tasting caviar after inking a $300 million tax break in order to open offices near Ground Zero.

Caviar anyone?

Eat it now, because there might not even be bagels tomorrow.