|April 3, 2011|
Deputy Mayor, New York City
Uncorrected transcript provided by Morningside Partners.
Q&A with Stephen Goldsmith
BRIAN LAMB, HOST, Q&A: Stephen Goldsmith, how would you describe the difference between being mayor of Indianapolis for two terms and being deputy mayor of New York City?
STEPHEN GOLDSMITH, DEPUTY MAJOR FOR OPERATIONS, NEW YORK CITY: Well, there are a lot of differences. There's one difference between being a mayor and a deputy mayor that's not insignificant. I'm now an agent, no longer the principal.
There's obviously a difference in scale and complexity, but to some extent, you know, Indianapolis is the 12th largest city in the country. It's not New York City in terms of population, but many urban problems are common from place-to-place particularly in tough financial times.
So it's fun and challenging and somewhat similar, but dissimilar in a lot of ways as well.
LAMB: When did you decide to do this job and why?
GOLDSMITH: Well, I'm not sure exactly when. I was, yes, teaching at Harvard running an innovation center and, you know, a little bit of consulting to cities around the country. And I wrote a book on social entrepreneurship which is the relationship between the entrepreneur and non-profits and cities and government.
And there was a chapter in there about New York City and Mike Bloomberg and Joe Klein, the school chancellor and it was a pretty flattering portrait. I was impressed with what they'd done and I assumed that somebody in the Bloomberg administration saw that and appreciated my good sense of judgment and Mike Bloomberg called me up and said, "I've got this idea." And I went, "This is a really strange idea. I'm not sure I'm ready for it."
And he said, "Look. This is probably last April. It's the greatest city in the world, large footprint, a place where reform and innovation would be appreciated. How could you say no?" So I said, "That makes sense. I'll say yes."
LAMB: So how long have you been on the job?
GOLDSMITH: I've been on the job about six months.
LAMB: What was the first thing you noticed once you got inside the City Hall?
GOLDSMITH: Well, I mean, I'm a great fan of urban spaces, the diversity, the energy, the activity, the opportunity. I've worked on and off with most of the large city mayors in the country in the last few decades, you know?
When I started as mayor of Indianapolis, a group of us who were all friends were elected mayors of large cities at the time: Rich Daley in Chicago and Ed Rendell in Philadelphia, Kurt Schmoke in Baltimore. I like cities and kind of watch what they do.
But this is a particularly interesting time for cities because revenues are down, expenses are up, a lot of stress in a lot of places particularly the protracted recession, although New York's been a little bit better off than most cities. Still has folks who are struggling.
It's the common issues of people across the country who struck me, A, but B, the difficulty of injecting innovative reform in a really large bureaucracy also struck me as well.
LAMB: I have a lot of former things that you've written and also stories about you. What's the difference between being mayor of Indianapolis and being deputy mayor of New York when it comes to the media?
GOLDSMITH: Well, this there's more here and they're more aggressive. Now, in I think media and cities have changed, by the way. I mean, the local hometown paper, which both was a cheerleader and could afford investigative reporters, right, they're both the kind of the truth calling squad in one sense and the cheerleader in another. That in many ways has gone away.
The New York City, media is a very aggressive media. There's a lot of tabloid media. Small stories become large. That's the best way to explain this as I you know, I enjoy the social media. So I tweet from time-to-time and I tweeted a compliment to our truck drivers who are working really long days, Sanitation Department, in the snow storm, like, you know, "Good job."
Well, you know, it turned out the timing wasn't so good because the job wasn't so good and that became its own, like, full page article in the in the newspaper on what I thought was a relatively innocuous attaboy.
So I think the difference is that the high profile of little mistakes and big mistakes makes it difficult to pick up momentum for change, right? Because you can easily you try to encourage as Mayor Bloomberg does an environment of change, an innovation, but that involves risk and risk is exploited by aggressive newspaper reporters.
I don't mean that they're doing their job wrong. It's just the way it is. So it's difficult to pick up the momentum from major changes with an aggressive press that doesn't kind of build it's on your momentum.
LAMB: Well, they loved here, it seems like, pointing out the fact that in 1994, I think it was, the big snow storm in Indianapolis you happened to be in New York and this time when the big snow storm hit around after Christmas you were in Washington and they loved to stick the needle in there.
What was your what did you say to them at the time?
GOLDSMITH: Well, in Indianapolis, I was mayor for eight years and we successfully fought the snow every time except once. Mike Bloomberg's been here 10 years, successfully fought the snow 70 times and lost once. Unfortunately, I was there for the once.
And look, the city of New York has a very professional Sanitation Department, does a terrific job on snow. They had the sixth largest snow in history in New York City and some things went wrong, you know? Actually, lots of things went wrong and we learned from our mistakes and we're going to move on and correct them.
LAMB: Why did it go wrong this time?
GOLDSMITH: Well, there's a couple of lessons in here, some that are kind of localized about snow and others that are generalized, right? So if you have a very deliberate way that you approach a job, let's say, snow fighting, and it works every time, then you then you seem to you execute that the same way.
Well, if the snow is extraordinary, the timing is extraordinary, the amount's extraordinary, the wetness is extraordinary, fill in the blank, the same path doesn't always work. And what we found this time was that we didn't have really active up-to-the-date second-by-second management data reports about where the trucks had been, we're off a little bit, that there were mistakes made by others, for example, a thousand buses got stuck.
And you look back and you say, "Should you have declared an emergency" while the people here who met and decided not to declare an emergency made a reasonably good faith decision that turned out not to be not to be right.
So the point of the story is it's easier to do Monday morning quarterbacking. Here, I think we learned that real-time management data coupled with a little bit more in terms of deliberate systems would've helped a lot.
LAMB: Alright, tell me where I'm wrong here: Born in Indianapolis, went to Wabash College in Crawfordsville, which is an all boys school. Still is?
GOLDSMITH: It still is.
LAMB: Went to the University of Michigan, got a law degree, came back to Indianapolis, was a prosecutor? And then what?
GOLDSMITH: Well, I really what I always wanted to do was be mayor. I thought that was that was the job where you could do the most good. So I went to law school and because you can't go to mayor school. So I went to law school. I practiced law in Indianapolis, then tried to figure out how to break into politics and decided the route would be to try to get elected district attorney/prosecutor.
I accidentally won. I was running against a really honorable guy. I should never have won. You know, the former Congressman.
LAMB: Andy Jacobs?
GOLDSMITH: Andy Jacobs had an enormous character. He was just--, he was just a great guy. But for some fluke I won and then I served several terms and then got elected mayor in Indianapolis.
LAMB: And what was you know, as you're going through those eight years, people were talking about you as being president some day, cabinet officer. You worked in the George Bush administration and all that.
What was in your head at that time?
GOLDSMITH: Well, it depends what the time was, but I thought then and still think there's no better job in America than being a mayor. There's no job where you can wake up everyday and see something that's broken or see a family that needs help and go solve it. You can solve it.
I mean, if I had enough time, I could've done something for, you know, every citizen of Indianapolis. And to some extent, Mayor Mike Bloomberg had really long days even in his 10th year and has the same attitude and all were so the rest of my friends who are mayor as to whether they're Rudy Giuliani or Rich Daley, right?
That it's a very motivating thing. It's not like giving speeches and, you know, pontificating. You can actually go out and do it. So what I was determined that I wanted to be the best mayor ever and, you know, we had a fair run of success in a number of ways. I then ran for governor and lost on a campaign that was really not very good.
LAMB: Why did you lose?
GOLDSMITH: Well, I did I what I managed to do was start ahead, raise a lot of money and do enough things wrong over a long enough period of time that I managed to pull out defeat and I ran against a really nice guy who was Evan Bayh, Lieutenant Governor. Evan was a very popular governor. We actually got along quite well.
LAMB: Frank O'Bannon?
GOLDSMITH: Frank O'Bannon. I was running on a platform of change who just said, you know, "I kind of like the way things are. I don't know if I want your platform of change." I had a very acrimonious primary and that never healed over. And then one of the things that plague mayors, I think, who run for and that you know, at that time I'd never been an Indianapolis resident. I'd been governor, not yet a mayor. Not even a mayor, of course, but we had a little police controversy, a police brawl where elite police officers beat up some folks.
And if you're mayor and you're running for governor and you can't keep things perfect in your city, it tends to be kind of an explosive issue in the campaign. So, in the end, I lost and he won and I went back to being mayor.
LAMB: Why did you move to Washington?
GOLDSMITH: So my last year as mayor I became the chief domestic policy advisor to George Bush in the 2000 campaign, crafted his domestic agenda to some extent. Condi Rice did international and I did domestic. And then my wife's from Washington and she wanted to go home and I went and did the transition for the campaign.
And then instead of working the administration, I went up to Harvard to teach.
LAMB: Now, your wife, Margaret, is a Pulliam?
GOLDSMITH: Youve done a lot of research.
LAMB: Well, I'm from Indiana and I remember these things.
LAMB: But a Pulliam, for people that aren't from Indiana, would mean what? And how what was her relationship to the Pulliam Family?
GOLDSMITH: My wife's mother is a Pulliam and my wife's mother is sister to Dan Quayle's mother.
LAMB: And the Pulliam Family owned the Indianapolis star for a long time. Did they did the Star treat you well and did they own it when you were their mayor?
GOLDSMITH: They owned us, yes. I thought the editorial pages treated me well. I thought the reporters in order to prove their fierce independence overcompensated. So I don't know what I'd say about the news pages. Well, to me I mean, in fairness, kind of goes back to your earlier questions, I believe in change. I believe you have those jobs in order to make life different and better for the folks who live in your community and that means every second counts.
And so a change agenda sets up an executive branch elected official for one newspaper story after another because if you maintain a mediocre status quo, nobody complains. If you try to jump and you just go up seven steps instead of 10, there's always angry just, you know, folks who may have been moved or demoted or changed. There's neighborhood groups who used to win and now don't win quite so much.
And so you set yourself up for a barrage of articles. And so what to me my mean misperceived as overcompensating news reporting may just have been the natural result of me producing a lot of stuff. I'd say two-thirds worked, one-third didn't, but one-third of a lot of stuff is a lot of newspaper articles.
LAMB: Now, for a while you were doing the faith-based work in the White House for President Bush?
LAMB: Why did you take that job?
GOLDSMITH: Let me back up a few years in answering your question. It won't take me a few years to answer, but I've got to back so I got elect I'm Republican. I got elected mayor because I wanted to help Indianapolis and the way to help, I thought, the folks in our city was to look at the communities that had been most neglected and had the most number of grayest number of problems since kind of World War II in the typical kind of urban areas, 8,000 to 20,000 people each and I tried to figure out what I could do.
We did a lot of things, which we can talk about later, and then I look back a few years later after that and say, "OK. Of these seven communities of 8,000 to 20,000 people, which ones are working and which ones aren't?"
Well, it turns out the ones that are working are ones where government was involved in a cooperative exercise with neighborhood leadership where people in a community cared and where you worked together to solve problems, not government parachuting at folks and not government ignoring them. It's a partnership because you can't make a community a safe and vibrant place by government alone.
Well, we mapped all the assets in those communities and it turns out unsurprisingly that the most common asset in those communities is a faith-based institution Indianapolis of Church in the urban communities.
And so then we began to partner with those and these were small churches, 400 to 500 people each, part-time pastor, created something we call the Front Porch Alliance, intentionally looked at how we could help them, right? Do they need computers for their preschool? Do they need the crack house across the street raised so that what else can we do that would help them expand their positive could we allow them to help clean up the neighborhood park and use it some more?
And so that was a pretty flourishing exercise and what it then led to Governor Bush announcing his campaign for governor for president in Indianapolis at one of those institutions. So that's where the Armies of Compassion speech, which even folks who don't like the president should read the Armies of Compassion speech. It's a wonderful speech.
And that then evolved to the faith-based initiative in the White House, but to me it is was just one element of how government should participate with non-profits, for-profits and faith-based institutions to create a fabric, right? A network that makes a city work well.
I helped set up the office, but then instead of leading it, I went up to Harvard to teach and I became then chairman of a little known government corporation called the Corporation National Community Service, the parent of AmeriCorps and VISTA, and that was a volunteer job.
So I worked in the White House about one day and then went up to teach.
LAMB: In the middle of all this, you were put on the Fannie Mae board in 2002.
GOLDSMITH: I was on the Fannie Mae foundation board, but yes.
LAMB: So you were not on the big board?
GOLDSMITH: (INAUDIBLE). No.
LAMB: You know, it's interesting they don't say foundation board in all of this.
GOLDSMITH: But I'm quick to say that. Thank you very much.
LAMB: And why are you quick to say it?
GOLDSMITH: Well, I know Fannie Mae had its issues, Republicans were anxious about Fannie Mae at the time and Freddie. I was involved and interested in affordable housing as mayor and as a cause, but the Fannie Mae Foundation was a foundation that invested in community leadership.
And so it was totally it was it was not in at the time, it was not even inside the Fannie Mae Corporation itself. So it was a separate entity.
LAMB: One of the things that no one's talked about in this whole Fannie Mae thing was that President Bush stopped putting members on the board. I've only found that in once place in one article in the New York Times a long time ago.
When we called to try to find out from Fannie Mae how the process worked, we got no answer, no feedback. I ask you only because you might know. Why did he not nominate people to be on the board after a certain time?
LAMB: Yes, I'm not actually sure. I know that there was a period there where they reached impasse and the White House stopped nominating people. I don't know if it was because of the mission or otherwise.
I mean, there was there was I mean, there were kind of there were somewhat inconsistent goals under several presidents. One is to drive up homeownership as much as possible and the other was to not was not to take in prudent risks with respect to loans. And I think you can do both, but the mission of Fannie Mae as a corporation began to concentrate more on, you know, one than the other and became problematic.
LAMB: I'm going to grab a couple of articles here and ask you about them. This is from August the 29th and you're onboard as deputy mayor of New York City for Operations. How many deputy mayors are there?
LAMB: And what's the difference in being an operations deputy mayor than the rest of them? Because I saw somewhere you said you'd rather have somebody else's deputy major job.
GOLDSMITH: Well, there's a you know, one of the things that drew me to New York is I started when I started writing I write books in my spare time and there's a deputy mayor, Linda Gibbs, that's just done some remarkable stuff here on homelessness and affordable housing and the like and I just I was a big fan of Linda's.
And then so she does kind of social services, somebody else does education, somebody does economic development, you know, and I kind of do the mechanics of government, you know, police and fire and sanitation and budget and things. So and when I was interviewed by the Times, I said, you know, "I'd be happy to trade jobs with her. She goes out everyday and helps folks and I run the kind of mechanics of government."
LAMB: And also, there are, what, 50,000 policemen here, which is bigger than all of the government of Indianapolis?
GOLDSMITH: There are more police officers than there are total employee there are more police officers in New York City than there are in total employees in Indianapolis, yes.
There's I mean, the you know, there's between 330 and 350,000 New York City public employees counting education which means is you know, there's Indianapolis is 800,000 people. So one out of every two and a half people in Indianapolis would be a public employee in New York. It's a pretty big scale.
LAMB: How many people directly report to you?
GOLDSMITH: Well, I don't know. Somewhere between zero and 100,000. It depends on how you look at it. I mean, really. I mean, the what Mayor Bloomberg's done has attracted a number of very professional senior managers inside his government that other people run, fire and police and sanitation, who grew up in those departments, they know those departments well. They're very committed and they don't need me to tell them how to manage their day-to-day stuff.
But when we're two or $3 billion off when some of our systems are a little bit antiquated when we need broader based reform and I looked at myself as a colleague who can produce some of those results.
LAMB: What's the size of your budget under the operations area?
GOLDSMITH: Well, I actually have never totally counted it up. It's probably $15, $20 million.
LAMB: Billion? Yes. And what was your Indianapolis budget?
GOLDSMITH: One billion.
LAMB: This article from August the 29th, "City taken to cleaners on fleet car wash fees. New York is on track to spend more than $400,000 this year just to wash its cars. That includes paying as much as $110 to clean a little Toyota Prius and $263.25 to clean a GMC Sierra pickup truck. Stephen Goldsmith, the Deputy Mayor, trying to save $500 million a year by streamlining how the city runs is trying to find out how to."
How much is too much in all that? How in the world can you spend $263 to clean a truck?
GOLDSMITH: I thought it was a little bit high, you know?
LAMB: What did you do about it?
GOLDSMITH: Indiana, I think it's four quarters in the machine and then you spray the water. I don't know. You know, one of the problems you have with this much scale is it's an easy excuse not to pay attention to the pennies and the quarters and that's obviously more than that, but every car wash counts, right? You know, no more bottled water in the offices, right? Yes, I don't know what that was.
GOLDSMITH: Because we don't need it. We can either drink it out of the tap or we can buy it in the drums. We don't need to buy bottled water.
LAMB: I read somewhere where New York's got some of the best water of any city?
GOLDSMITH: We do. We do. And so, you know, you can so you can justify bottled water, you can justify a car wash, you can justify one-sided copy paper. We've started I still have a little icon, so simple, on the citys website, nyc.gov. I said, "Give me your ideas if you think we can how we can improve city government." I'm expecting, you know, five, 10.
First two and a half weeks, 3,000 and 80 percent of them were good: turn off the electricity and p.s., blank, blank, blank, right? Or the like. And so we're going to go after it and root these things out, you know, 100,000 here and 5,000 there and a million here and you and you every time we do this, you've got to say to folks, "Look. This is a city where a lot of people are struggling and they're paying taxes and every dollar you spend is a dollar they don't have so you better spend it well" and we hope to create that culture.
LAMB: What happened about those trucks and cars being washed? Did you get the price down?
GOLDSMITH: We got the price down. We're consolidating some of the contracting. We eliminated some of those of what's called, "details," you know? And we're going through the we're going through it. And then the question becomes, you know what? Why do we have so many cars? Why do people take home so many cars? Do they pay for the cars they take home, you know?
And so each one of those is a cascading set of questions which leads to answer which leads to some savings and we ought to be driving every dollar we can into a classroom or a precinct beat or a firehouse and we shouldn't be spending it where we don't need it.
LAMB: Here's one from October 13 of last year from the New York Daily News, "City workers will turn over the keys to a new fleet of shared cars at the end of every work day so regular New Yorkers can rent them on nights and weekends. The Pilot Program puts 25 hybrid cars at the disposal of 300 Department of Transportation workers during the day replacing a previous fleet of 50 city-owned cars." Explain that one.
GOLDSMITH: Well, there's a lot to be said for public-private partnerships. I mean, everyday public employees do a good job of what is inside their portfolio. So and they may need a car. But then you've got another group of companies where they lease cars or otherwise that are in the business of renting cars. So you so Zip Car leases cars by the hour or the day, right?
So and they find that their weekends are really valuable time and we don't need very many cars on the weekend. So and why do we have to own the cars ourselves anyway? And why do they have to be individualized? Why can't they be a pool? Once they can be a pool, why do they have to be owned by us? And once they can be owned by somebody else, how can they make money off of those cars and bring down our unit costs, right?
So today in a in a pilot that worked pretty well in the Department of Transportation, they're pooled cars used by Zip and then Zip rents those cars to the general public when we're not using them and our price comes down.
Look, in Indianapolis, eight years eight years, reduced taxes essentially every time, put billion dollars into infrastructure, reduced the non-public safety workforce by 40 percent and every time the quality went up. So you just have to be creative about how you structure these things and folks can win.
LAMB: So what did you have a lot of unions in Indianapolis?
GOLDSMITH: We had a lot of unions. The difference in one of the differences, I think, in Indianapolis and New York is that I started off in a rocky way with my unions in Indianapolis. They were (INAUDIBLE) unions because I campaigned on privatization. I abandoned privatization because after because I used to go out and work no, let me back up.
So I got elected on a privatization. I went out to visit the guys who pick up the trash. This is Indianapolis, not New York. I should be careful. And the track guys who were city workers told me what they thought about my privatization agenda. They were really big guys and they were really mad and I vividly remember how they talked to me, right?
So I said, "OK. I'll make you guys a deal. If you just calm down, pick up the trash because I was thinking about John Lindsey and strikes and I didn't want to create a strike. I was thinking about John Lindsey, the guy that got elected to Indianapolis. And I thought he was a great guy, really smart fellow, but had a lot of labor problems.
So we reached an agreement. "I'll go out and work with you. I'll pick up the trash. I'll do the plumbing in public housing. I'll mow the grass. I'll work with the workers and I let me give me six months and I'll be back here." And at the end of six months, I realized I got a lot of really good ideas from those workers and the problem wasn't the workers. The problem was the public system. It wasn't the public workers, it was the public system. It was a bureaucratic, monopolistic, command and control system that sucked the energy indiscretion out of our workforce.
So I began to compete the private sector against the public sector. Well, the difference between Indianapolis and New York is over time they asked me, and who started angry, became partners. They got paid more, their productivity went up, they shared in the benefits, their quality went up and but they had to bid and they had to take some risks.
Now, the managers in Indianapolis were not unionized. The managers in New York City are unionized. The workers in New York City unions at the at the worker level; the police and cops, sanitation workers alike, I think have the same attitude, you know? We like our we you know, we want to be paid a fair wage, but we we're here because we want to make a difference for New York City.
It's just more difficult because there's 200 unions and not eight and they're layered on top of each other and they're crisscrossed with civil service rules that make it very difficult for people to exercise their discretion in the same way they did in Indianapolis.
LAMB: When I checked out of the hotel today, my bill included 16 percent tax.
GOLDSMITH: Thank you.
LAMB: The yes. The if you go to Indianapolis, it's not like that, but if you if you I mean, first of all, the rooms are very expensive here and they're often full. What is it about people that come here that are willing to take all this tax, this 16? And that's lower than it used to be.
GOLDSMITH: Well, New York City is a very exciting place, I mean, starting with kind of Rudy and going through to Mike Bloomberg. The city is much more livable, right? It's one of the safest cities in the country. It's got a lot of green spaces. It's a fun place to be. A lot of diversity and vibrancy and people come. They come from all over the world and they're willing to pay a price for that. The price isn't it is not just your hotel room, but your tax on top of your hotel room.
Now, the good news for folks like me who are now in New York instead of visiting New York is that that out-of-town dollar helps support a very large infrastructure. Thirty-five thousand cops is a lot of cops, for example, and bringing that tourist dollar here is works. And New York City tourists and hotels had a record year last year. So people are coming in record numbers even in tough times because they like...
LAMB: And paying the prices.
GOLDSMITH: And paying the price.
LAMB: You said 35,000 cops? Has the number gone down from 50?
GOLDSMITH: It actually went from 40 to 35.
LAMB: Another thing, and I've been coming to New York a number of years, this time I noticed I know this isn't new. I was here during the strike of the sanitation workers, but three times a week you see these huge piles on the street, on the sidewalk of green bags full of garbage and they're put out there at night and they're picked up sometime the next day. Why is that?
GOLDSMITH: Well, there's a mixture here. Some of those are commercial trash and some are city trash, you know? There's we're just it's a very dense city, lots of folks, not many places to put trash. Some areas of the city get picked up multiple times a week, sometimes twice a week, sometimes there's baskets on the corner. There's a pretty elaborate structure. The sanitation workers do a really good job, but there has to be a frequency of the pickups and there's nowhere else to put the trash than out in front.
LAMB: Where do you dump it all?
GOLDSMITH: It's a long complicated story. The city's been working through a number of places. Some of it gets put into cargo containers and taken to landfills outside the city. We're investigating whether there's better ways to handle it inside the city, but there's really no place today in New York City for its trash.
LAMB: What's the farthest away you take some of your trash?
GOLDSMITH: I'm not sure and if I knew, I'm not sure I'd want to say because whoever's watching would realize our trash is in their backyard. I don't think I...
LAMB: But it does go out-of-state and that's yes.
GOLDSMITH: It definitely goes out-of-state, yes.
LAMB: Is that ever going to catch up with us?
GOLDSMITH: Probably. I mean, both in terms of transportation and cost, now, there are communities that, you know, create jobs with this, but there's a lot of new technologies in terms of energy from waste that are really important, particularly in this environmental situation and I think we can make a difference by doing some more disposal locally.
LAMB: November 2, 2010, this comes from UPI. Headline is, "New York City Eliminates Christmas Cards. New York City Hall said officials are aiming to save money on paper costs by eliminating holiday cards and making double-sided copies. A memo offered by Deputy Mayor Stephen Goldsmith was distributed to city agency heads last week, outlining a plan to save $1 million per year by making double-sided copies and $50,000 a year by eliminating paper holiday greetings" the New York Daily News reported Tuesday.
GOLDSMITH: I was trying to become Scrooge. I guess I succeeded. You found the article.
LAMB: What was your reaction to that?
GOLDSMITH: It wasn't too bad. Most folks have, of course basically, I was trying to make a point. We're laying off employees. Taxes are as high as they can go and...
LAMB: Is that right?
GOLDSMITH: I think it's right. I mean, we different people reasonable people can differ on this issue, but some of it's true in Indianapolis and it's definitely true in New York that folks with money are the most mobile. They can move most easily. They can take their money and their tax rate and move, move to Pennsylvania or they can move to Florida or wherever.
And you we and this is a city where particularly on the income tax side, very, very few people pay a very large percentage of total taxes.
So the mayor definitely believes and I agree with him that you're you can you cannot tax your way into a balance budget, right? You can't redistribute your way out. You have to create wealth and create jobs and there's a limit to the tax increases. And I think on the income tax side, the mayor is exactly right. There's no room for additional taxes.
LAMB: So if you live here, how many different taxes do you pay?
GOLDSMITH: Well, you know, you pay, like, in other places. You pay a sales tax and you pay a personal income tax and you pay a property tax, but not everybody pays a property tax and not everybody pays a personal income tax.
LAMB: Do you pay a personal income tax to the City of New York and to the state?
GOLDSMITH: Yes. Right. And they're not insignificant taxes. Now, if you if you don't own very much money, you don't pay the taxes, but the point is that I mean, I have these negotiations including with the unions where they say, "Well, the just increase your tax rate," and we go, "It doesn't work," right, because you do have the flight of wealth.
So the goal now, right, is to get the expenses under control and then let the you know, the expanding New York City economy, even in this tough time, has produced income that's allowed government to be maintained at the size it is, but that doesn't work over time because the retiree and pension costs are going up so dramatically that they exceed the new revenues by a substantial margin.
LAMB: I want to go back to this important issue of Christmas cards and the double-sided sheets and all. When you make a decision like this, do you have to get the mayor to approve it or is this the kind of thing that you can just do?
GOLDSMITH: Both. I mean, you know, the we have an office where the mayor doesn't believe in walls. So, you know, he sits in one cubicle and I sit next to him in another cubicle and then there's other folks in other cubicles around us. And...
LAMB: Is that the only office you have?
GOLDSMITH: Its the only office I have and its the only office he has.
LAMB: And how many people are in that room?
GOLDSMITH: A hundred and fifty. That's city government.
LAMB: Are you in the center?
GOLDSMITH: He's in the center and I'm next to him. I would never say I was in the center, but I'm pretty close to the center. And so if I have an issue that I think is I know what his policies are and I know when he wants to be briefed and I know when there's a close call. So, I mean, on something like that, I would essentially just turn to him and say, "I really don't think we ought to be this is actually what happened."
"I can't believe we some of these agencies send out Christmas cards and we don't have any money. What do you think about that?" He goes, "Well, that absurd. Stop it." So I write the memo. But had I written the memo and not told him, I would've been I mean, I would've anticipated that his reaction in the way it is for...
LAMB: All the deputy mayors around him?
GOLDSMITH: Well, yes, we're down we're down a row, I guess you would say.
LAMB: And how does that work out? Because I do you know of any other city that does this now?
GOLDSMITH: Well, he was the first and then D.C. followed and I don't know if the other cities do or not to you know, a lot of cities or mayors like the substantial offices. I think it's great. It makes him accessible. It makes information democratically available. It says if somebody wants to ask a question, they walk up. I don't have to ask for an appointment with the mayor. He's there. People want to see me, walk up.
LAMB: But what if you want to have a meeting and it's a private meeting? I assume you've got a room to go to?
GOLDSMITH: Well, we have we have three, what you would call conference rooms, but I would call tables at the front of the room where most meetings occur and then there's a handful of private rooms if there if you have a big crowd, it's too noisy, but it works.
LAMB: Well, Mayor Bloomberg when he and I assume he goes back to his corporation, started with the Bloomberg Company, he had the same thing in that room. He was sitting in the middle of the room. Actually, he was sitting at the other end. We used to do our shows from there, but he'd sit at the you walk in the door and his desk was right at the right-hand side there.
That seems to be a very important symbol of some kind. What does it do?
GOLDSMITH: It's both a symbol and subtenant. I mean, a free flow of information is what creates value. That's what created value in his private company. That's what created value in City Hall.
And so the problem with government generally outside of that room, Indianapolis or New York, is that there are walls. There are literal walls and there are virtual walls. There are walls between agencies. There's walls between layers. And those every time you have a wall, you lose the flow of information. You lose the flow of information, you lose collaboration. You lose collaboration, you lose value. Very important statement and a very important functioning apparatus.
LAMB: In that room, are there is the police chief in that room?
GOLDSMITH: No, the police deputy mayors are in that room and press folks and government relations folks. And then the commissioners are out with their department with the police commissioners and the police headquarters and fire, et cetera.
LAMB: By the way, do you intend to do the same thing next Christmas on Christmas cards? Is that kind of a thing now?
GOLDSMITH: We are done with Christmas cards. You can elect you can email out an agency Christmas card, but you can't spend a lot of money creating it.
LAMB: Here's another headline: "New York this comes out of the International Herald Tribune, "New York cuts software deal with Microsoft Company to charge city only for applications that are used by workers. New York City has put the squeeze on Microsoft negotiating and this is the language of the story negotiating a bulk software purchasing deal that should lower technology costs for the city and give the government workers access to more modern applications. 'We took advantage of the competitive moment,' said Mayor Deputy Mayor Stephen Goldsmith." Explain that one.
GOLDSMITH: That's actually a big deal a big deal, I think, for Microsoft, a big deal for cities. So but it also represents more than just the technology contract. Well, think about it, there's a couple of ways. So government tends to accept an existing model and the existing model becomes too expensive and then they're left with try to how to bargain down the cost of it.
The model's wrong. They have a lot of employees. We do not want to pay a licensing fee for every desktop computer to use that software which had been the Microsoft model. And we have some people who use Outlook-Excel-PowerPoint and we have some people who use just email and so we have different scale users.
What you want to do is you want to buy the access that you want and then you want to move employees to whatever level of performance they need. So this is kind of Cloud computing, plus desktop computing. And so basically we said to Microsoft, you know, there are others in this business as well. We want a competitive price, but we're not paying for every single desktop-laptop. We want to pay by use and we want to have an incentive for us to reduce the use, not to increase it.
So let's reprice the whole relationship and let's make sure we have the best of collaborative tools. Well, we saved $50 million. Not an insignificant amount of money even by New York City standards and it dramatically well over the next few years increased the availability of these tools to all of our workers.
LAMB: Is it your personal goal to slice $50 million $500 million from the budget?
GOLDSMITH: At least. That's I'd like to measure it in billions. Five hundred million $5 million isn't really that difficult in the sense that you can you can see it and you can do it. Now, there are some bureaucratic obstacles, right? So we so a lot of this is what's called shared services like how do you negotiate the Microsoft contract, how many we have we have 10,000 too many desks, right? They're not like in one building like we have a million square feet too much, but we have it scattered in different places. How do you shrink the footprints, right?
How do you look at all collecting all the money that's due to New York City? Who's who what one person's responsible for all accounts receivable, you know? Who is responsible for the fleet? We have, you know, 50, 75. I don't even know how many anymore of garages. Consolidate them, right? Just consolidate them.
The same is true of our I.T. servers, right? We have these server farms everywhere. So shrink, consolidate and organize, get the $500 million a year eventually.
LAMB: What's the biggest most important project on your desk right now?
GOLDSMITH: Well, I think the biggest project is to really liberate the workforce. And by that, I mean, we operate under a set of really archaic rules. You know, basically, this is the city of Tammany Hall and this is the city that where progressive government was really in large part created one of a couple of cities.
And so over the last hundred years, in order to make sure that mayors didn't hire their friends and give contracts to their buddies, there are lots of rules. And if 100 rules are good, 1,000 rules are good. And if 1,000 rules are good, 10,000 rules are good. And now, there's a rule against everything.
And basically what it what it says is the way we have stopped the abusive discretion is by eliminating discretion and then we're going we're going to make it illegal so that challenge now is to inject a new sense of public service, broader discretion, broad banding, fewer job classifications, more authority over our own procurement, more liberty from Albany and state capital about what the city itself can do.
We need to create a post-progressive form of government where we have as our obligations solving the problems of visitors and citizens. And, you know, one way to think about this, if you want a restaurant license in New York City, and this is something the mayor's asked me to look at, you've got to go to, like, 20 different places. You have to get a grease trap license. You have to get a kitchen hood license. You've got to get a cafι sidewalk license.
We're organized for our own benefit, right? We ought to say, "If you want a restaurant license, come to the restaurant department. Don't go to the grease you know, it the example that strikes me that the, I guess, analogy or metaphor is that if it would be almost as if McDonald's set up four restaurants and said go to restaurant one and buy your bun, restaurant two and buy your hamburger, restaurant three and get your ketchup and four you can have French fries if you want, then you can put them together for your meal, but that's your problem.
That's the way we operate. That's the way the mayor wants us to what the mayor wants us to change.
LAMB: Personal stuff for a moment. You still have a connection with Harvard?
GOLDSMITH: I'm on leave from Harvard.
LAMB: On leave from Harvard? So you have a Boston as a possible location in the future?
GOLDSMITH: Oh, yes.
LAMB: Born in Minneapolis. Your wife lives in Washington.
GOLDSMITH: Yes, for a little while longer. I hope she'll live in New York shortly.
LAMB: You're in what, a room over here at Columbia University?
GOLDSMITH: I am, yes.
LAMB: How long do you want to do this?
GOLDSMITH: And which would be this, not knowing where I live?
LAMB: All of that. How long do you want to be deputy mayor and do you intend to go back to Harvard?
GOLDSMITH: Well, I've got to get the near-term figured out. I like Harvard, but I like New York City a lot. I'm excited about the fact my wife is moving here. I finally found a place. I can get out of my dorm room at Columbia where I've been for six months and see and enjoy a great city.
I it's kind of like the attitude I had as mayor of Indianapolis now as New York. I have an opportunity to serve. I mean, I the only reason to take this job is to serve. There's no other real reason. It's not like a career step anywhere for me. And so I like New York City. I want to see if I can make a difference. We'll see what happens at I know I won't be in this job longer than two years "X" months from now because that's when my boss leaves and in the meantime, we'll see what happens.
LAMB: It begs the question do you want to run for mayor here?
GOLDSMITH: I don't think so.
LAMB: Why not?
GOLDSMITH: I've had a chance to be mayor. I'm now here as deputy mayor. I wish the next mayor of New York City well. I'm happy to help, but it's not going to be me.
LAMB: In this time that you've been deputy mayor, has there been any time you said to your wife or anybody, "Boy, this was a mistake"?
GOLDSMITH: I never said it was a mistake. I said it's a little more arduous than maybe I had thought. I realized the scale and complexity of it. The I come from the school that these are opportunities in life you're supposed to make the best of for others and every second counts and there's a scent there's that bureaucracy here and the procurement rules and the like are stacked against instant action.
And I don't mind the day-to-day toughness. It's I just need to start knocking down the milestones. We are just finally at the point where we're getting the savings or improving the quality of services. We're changing the Buildings Department. We're improving the way we relate to New Yorkers. And if we can really use the last two and a half years of a truly great mayor's term to reorganize and reposition the city for the future, it'll be well worth it.
LAMB: This paragraph, I want to ask you about this because it fits with what we're talking about from January of this year with David Chen writing it. "Hands-on job as a deputy taking lumps." This is all about the snow. "On Monday, most New Yorkers will get their first look at the still obscure deputy mayor you were obscure in January when he is called before the City Council to explain what went wrong during the blizzard, but some current and former city officials are already suggesting that Mr. Goldsmith, who was the mayor of Indianapolis in the 1990s until last year had never lived or worked in New York is the wrong man for this high pressured position."
His immediate predecessor, Edward Skylar, was so maniacal about making the city work. He was called, quote/unquote, 'Batman' and once tackled a would-be mugger in midtown Manhattan." When you read that, is it one of those things you say, "I they'll never accept me because I did I'm not from here"?
GOLDSMITH: Well, Ed was a great deputy mayor and he's younger than I am. I'm not tackling any would-be muggers. I don't think I'm I don't think I could catch them actually. I think there are a couple of a couple of things in that article that bothered me a little bit. One is I think there is a view you're not from here, therefore what do you have to offer and that's pretty typical of any city and it's a little bit more typical of New York and I appreciate that folks look at me with kind of, like, you know, are you up to the job and I'll show them I am. I'm not worried about that.
The second implication in that story is also interesting and it's the following which is that do you want so the mayor recruited me saying, "I want to avoid third-termitis. I want to be able to show bold reforms that we're doing in the in the third term." And I've got a responsibility for operations, but I have the same attitude the mayor does.
He's recruited really talented people to run these agencies and Commissioner Ray Kelly does not need me to wander over to police headquarters and say, "Reposition your police officers in the following way." I need to collaborate with him and I need to work with him, I need to help him inject more technology and think through the budget issues, but I don't he doesn't need me to run his department.
So I actually believe that the thesis of that article is off a little bit because I'm not sure that's what you want from your deputy mayor of operations. At the same time, I have a responsibility to watch the details and 16 hours a day I'm watching the details of city government.
LAMB: This guy says you get up at 5:00? What do you do then?
GOLDSMITH: I work out so that I don't go prematurely crazy from my day-to-day job.
LAMB: When do you work out? Where do you work out?
GOLDSMITH: I just now, that I'm a little bit older, my knees hurt a little bit more. I use an elliptical. I work for about, you know, 45 minutes or an hour every morning at a sports club and then I head off to work and I try to make sure that I'm the first one in and the last one out and have what I developed from the my earlier days and work through the grind of kind of what are the day's issues and how are we moving on the big substantive matters.
So it's a it's a good day. I enjoy the hours and I enjoy the challenge and the long days.
LAMB: Is it true that you eat the carrots?
LAMB: And what does he mean by that?
GOLDSMITH: Well, we have a little -- the mayor furnishes a little City Hall has a little cafι, it would be an exaggeration, but a little food corner.
LAMB: He did the same thing and still does in the Bloomberg Company?
GOLDSMITH: Right. Right. And if you're careful, you can exist on lettuce, celery and carrots and lots of coffee. It works really well.
LAMB: In your life if you look back on people you know or inspirations you've had, who would you single out? People that have mattered to you?
GOLDSMITH: I mean, you know, it's obvious that family and parents and...
LAMB: What did your what did your mom and dad do? Are they alive, by the way?
GOLDSMITH: My mom's alive. She's in Indianapolis. She's a housewife. Proud of, I hope, of kind of what she's produced in her kids. She's at 88, a competitive bridge player which I hope is a good sign for me that I'll still be that alert. And my dad was a builder, but you know when -- I was in college when Dick Lugar was elected mayor of Indianapolis and he was the I'm casing too many inspirations as far as I know, the first really honest and really smart and really competent mayor of Indianapolis. He created the former government, as you know.
And Indianapolis was a really tough place back then. And I thought tough place and he and I was in a forum of Indianapolis mayors recently and somebody asked me about him and, you know, I was in high school public high school in Indianapolis, Indiana. The president of the school board when I got elected to student council president wrote me a note, he said, "Attaboy. Keep up your public service." His name was Dick Lugar, right?
And I must've saved the letter for 20 years, right? So I think that those folks who serve honorably can be can be a great source of inspiration and that's one name.
LAMB: Who else in the world of philosophy or leader national leadership or world leaders have gotten your attention?
GOLDSMITH: Yes. Well, I'm a I have an interesting policy, right? So I consume a lot of policy from probably from the center probably from the center think tank, center right think tanks and I've been I've been the benefit when I was mayor of Indianapolis. I found my way to the Manhattan Institute.
LAMB: Here in town?
GOLDSMITH: Here not located far from where we're talking today. And what I thought was interesting about them and their group of writers was they cared a lot about cities, but they thought about them in non-traditional ways, how should the zoning work, how should the regulations work, how should the taxing limitations work, how should you know, what should civility mean, how do people get along together.
And so, you know, I've whether you start with James Q. Wilson or other folks who kind of think about slightly different ways from accepted political orthodoxy about the ways that it should work, I'm a fan of all those.
LAMB: Have you changed your mind at all on privatization of government functions?
GOLDSMITH: Well, in Indianapolis, we did the largest (INAUDIBLE) of privatization, you have airport privatization, I.T. privatization. Today, I would I would I would say it differently. I don't think privatization per se is the answer for cities, but I don't think public monopolies are the answers for cities. It's really the way the public and the private sector work together. It is the answer.
So sometimes that's competitive. Sometimes it's outsourcing. Sometimes right now in New York City we're actually bringing some things in because for the for the private sector to perform well, it has to be well managed by a professional city employee or federal employee. And when things go rye and they have a lot in the like, the big I.T. systems, city and federal, that's when both sides are off.
So I'm trying to bring some jobs in, I'm trying to send some jobs out and trying to get it right. So I would say it's more of the nature of the person, the agency, the system, and inherently which sector owns the solution.
LAMB: When did you do take something private in your experience both in Indianapolis and here that worked the best?
GOLDSMITH: A couple of those in Indianapolis worked very nice. One, waste water, which was is generally across the country at the time and still is a government-run operation. We offered it up for bid. Ended up not selling the asset by bringing in a very large international manager.
The manager at my encouragement accepted our ask me union and accepted our ask me leadership. Everybody was very anxious at the time. It turns out a few years later, accidents had been reduced by 90 percent, workers comp claims had been reduced by 90 percent, grievances had been reduced by 100 percent, pay went up, in other words some thinning of the management structures, but it turns out it wasn't the employees the public employees who were holding us back. It was that we this was a international company with more Ph.D.s than I had employees.
And so I had management talent and technology know-how that worked. And so when you get that combination, it works quite well.
LAMB: What's your philosophy of joining? I have a list here of a full page of things that you have done in your life. We've gone over some of them, but you were chairman of the corporation for National and Community Service for how long?
GOLDSMITH: Ten years, Bush and Obama.
LAMB: What did you do that for 10 years? And what did you learn and what does it do?
GOLDSMITH: Well, I accidentally ended up there. It's a quasigovernment corporation that owns the National Service agenda and Republicans have always been anxious about it, viewed it as a President Clinton thing, AmeriCorp and therefore wanted to do away with it.
I had a conversation with incoming President Bush, said, you know he said, "What should we do about?" I said, "Why don't you just keep it and change it rather than get away with it." And he said, "Good idea. You're chairman." The whole conversation was, like, 16 seconds long. And so therefore I became involved and I was aware of it a little bit as the mayor.
But I think your question gives me an opportunity to make a point and talk about it which is that we need to think carefully about the role of government and sometimes the role of sometimes government usurps communities, right? It tells them how to operate. It imposes rules on their behavior. It drops in government programs. But if you in particular in hard-pressed urban neighborhoods, if you just withdraw government, those places are not going to be immediately resilient and kids in those communities don't have opportunities in their life.
The corporation has community service by saying, "Look. One of the things we can do as a government is provide the infrastructure for volunteer service. Not volunteers, but volunteer service, you know, a AmeriCorps member who helps teach reading or mentoring in a New York City public high school or Habitat for Humanity or Teach for America.
Those places those organizations have a place. So I did it for a long time trying to create bipartisan consensus under tried to convince Democrats that these young adults shouldn't be out on liberal causes and convince Republicans that they're part of the civic society and the civic fabric and if there was a place where the right and left could meet, I wanted to prove it.
Now and I would say under the under both Presidents Bush and Obama, we had created one of the truly bipartisan organizations that was respectful of civic communities. And so I stayed.
LAMB: How many presidents overall have you worked for?
GOLDSMITH: Well, I those are the two I worked for. I've been fortunate enough you know, I've been around in politics long enough to have been invited here and there to do I was on President Reagan pointed me to the Missing and Exploited Children's Board and first President Bush I was able to do some work with respect to an urban agenda. There weren't then and aren't now too many Republican mayors.
So you tend to get included in things, you know, that just by number. And so I've been fortunate. I've been fortunate to see a lot of really great people.
LAMB: What did you see up close with George W. Bush that either impressed you or what's your overall opinion of his presidency?
GOLDSMITH: Well, I'm just a local mayor and now deputy mayor. It's not up to me to evaluate his presidency. I was I was fortunate enough to be able to help on domestic policy and I was pleased that he followed through and implemented most of those things that we had worked on and I appreciated the fact that he was a man of principle and good for his word.
LAMB: How close do you get to making political statements these days in this job?
GOLDSMITH: Well, you know, one of the differences between a deputy mayor and a mayor is if I could say pretty much what I wanted as mayor and the only person that got in trouble was me, right? So if you make some not properly calculated comment, then you suffer by yourself. Now, I've got a boss, right? And he's got a series of comments.
So not only do I have to be think about what I say real quickly, but make sure I don't say anything that would cause trouble. I need to make sure I'm in line which by philosophy I am.
So I don't make I'm not I steer clear I'm not here for political purposes. I'm really not. I mean, I my first large speech, I got a bunch of questions on social policy; are you you know, are your social policies more conservative than this person or that person? I'm not here for social policy, right? There's a role for that in the dialogue and important role and there are important social issues.
I'm here to try to make streets a little bit cleaner and a little bit safer and that tax dollars go a little bit farther and prove that large cities, particularly great large cities, have a really vibrant future and I steer away from things that will detract from that agenda.
LAMB: All right. This is a kind of question that lead to you recommending or not recommending this kind of a move. I remember when Congressman Floyd Fithian left the Congress and became administrative assistant to Senator Paul Simon. Here, you have an elected official going to work for someone who is also an elected official. I mean, he was out of a job.
But you've done the same thing in some respects. You were a mayor of a city, the last step in the process, and now, you're a deputy. What do you think of it? I mean, would you recommend that to your best friends?
GOLDSMITH: Not no, I don't think so. I think it's a good step for me, but it requires a couple of things. One, it requires a mayor who's not threatened by his own staff, right? Enough self-confidence, knows where he's going, recruits talented people in large part and then lets them be successful. So Mike Bloomberg is a very unusual guy.
Secondly, there is a big difference between being the principle and the agent. And so you have to be pretty clear about what your new job is and willing to accept that. And mayors use their public profile to set their agenda and drive their agenda and deputy mayors are driving their boss's agenda.
And they may feel the same, they may be perfectly aligned, but you have to remember it's your boss's agenda, it's not your personal agenda. So I wouldn't recommend it too many people.
LAMB: We are out of time. We thank you, Stephen Goldsmith, Deputy Mayor of New York, for your time and we'll look forward to that book after you're out of all of this
GOLDSMITH: There will be one.
for the straight scoop. Thank you very much.
GOLDSMITH: You're welcome.
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