Republican Decision 2010

The interesting primary this September 14 is the GOP's race between Rick Lazio and Carl Paladino even though Democratic candidate-designate Andrew Cuomo leads both.  A September 11 Siena poll finds that Lazio leads Paladino by one percent, 43 to 42. Paladino leads with 53 percent among Upstate New Yorkers while Lazio leads with a similar margin downstate.  Paladino leads among Tea Partiers 47 to 42 percent.  This slim margin suggests that the appellation Tea Party is amorphous. The Tea Party is neither small government- nor Rockefeller- Republican.  For while Paladino advocates a twenty percent cut in New York's budget, Lazio's record does not put him in the small government camp.

Carl Paladino

 Paladino is a Buffalo-based real estate developer who attended St. Bonaventure University and Syracuse Law.  He is a tough, inspiring speaker who befriends but challenges his audience.

Paladino built a real estate empire from scratch. His current net worth is about $150 million.  While overseeing 15 office buildings is not an executive responsibility with as much latitude as the governor's, Paladino has had more at risk personally than any governor. As a result, he has developed management skills that would be more likely to benefit the public than those of a lifelong politician.

Paladino is accused of forwarding racist and sexist e-mails to friends. The New York Times has endorsed Rick Lazio over Paladino saying that the e-mails alone are grounds for rejecting Paladino. However, writing of Jesse Jackson's having called New York City "Hymietown", Times reporter Jodi Kantor implied on May 22, 2008 that Jews should not hold the epithet against Jackson because he has apologized.  Although Paladino has similarly apologized for forwarding e-mails the Times applies a different standard to him. 

Like Lazio, Paladino opposes construction of the Ground Zero mosque.  He has run advertisements saying that as governor he would use eminent domain to foreclose the mosque.  I questioned him on this point because many conservatives oppose eminent domain.  At an Ulster County Republican appearance in late August Paladino insisted that he is opposed to private use eminent domain and that he would like to see less use of eminent domain more generally.

Paladino is running on a specific platform of 20 percent budget cuts.  Although Lazio also states that he would like to reduce government, his promises are not so specific.  The chief targets for Paladino's cuts are welfare and Medicaid, whose per capita costs in New York are double those in California.  There are in fact many areas where Medicaid and other aspects of New York's budget could be cut without loss in public welfare.

Rick Lazio 

Lazio grew up in West Islip on Long Island.  He attended Vassar College and American University Law School.  He worked as a Suffolk County prosecutor. He was elected to the Suffolk County legislature in 1989 and to Congress in 1992. He resigned his congressional post to oppose Hillary Clinton for Senate in 2000.  His website states that he expanded public housing for seniors and the disabled.  He also boasts of having increased the number of welfare-related Section 8 housing vouchers. In other words, Lazio's track record includes winning votes by expanding welfare benefits. He also has endorsements from the Sierra Club.

According to his Website Lazio favors three chief positions. The first, "getting our financial house in order," involves a property tax cap of 2.5% and instituting regional control of Medicaid. Also, Lazio aims to reduce public sector pension benefits for new employees and to reform Medicaid.  Second, Lazio aims at job creation. He favors lower taxes, but unlike Paladino does not offer a specific target for tax or budget relief. Nor does he offer targets for Medicaid cuts. Lazio's third position is improvement of ethics in government.

This last position is puzzling given evidence that the Village Voice has uncovered about Lazio's dealings at JPMorgan, for whom Lazio has worked as a lobbyist. During his eight-year congressional tenure Lazio collected more in contributions from financial service firms than any other Congressman. He was chair of the House housing subcommittee and through Louis Ranieri, his campaign manager, linked to the real estate bubble of the Bush administration.  On March, 18 2008, six months prior to the financial crisis of 2008, the New York Times reported that JPMorgan’s stock had increased ten percent, roughly equal to a $12 billion handout it had received in part from the Federal Reserve Bank. JP Morgan also received $25 billion in TARP funds during the crisis, which it repaid in 2009.   The Albany Times Union reported that Lazio's 2008 JPMorgan Chase salary was $325,000, with a bonus of $1.3 million.

According to the Village Voice, both Congressman Lazio and Democrat Andrew Cuomo as head of HUD worked on rules that legalized bonuses paid to real estate brokers who steered customers to more expensive real estate and higher-end mortgages.  This marked the inception of the sub-prime crisis.  The Voice also reports that in 2007 Lazio used his influence with Charles Millard, head of the Pension Benefit Guarantee Corporation, to secure a $900 million PBGC investment in JPMorgan's real estate management division.  The PBGC insures private pension plans. The untimely 2008 investment led to significant losses.  Moreover, in dealing with Millard, Lazio violated laws concerning communication during the bid process.  The PBGC's Inspector General has investigated the case and has referred it to a prosecutor.

Analysis

Liberals dislike Paladino's style, which I would describe as Jacksonian.  Andrew Jackson was a people's candidate who infuriated upper class Whigs, the 1820s' and 1830s' equivalent of today's Rockefeller Republicans and Soros Democrats.  Jackson, like today's libertarians, advocated elimination of the biggest government program of then and now: the central bank. Like Lazio, Jackson's opponent, Henry Clay, supported big government and was friendly to banking interests.  Jackson was an unabashed racist who was responsible for the Trail of Tears and whose Supreme Court appointee, Chief Justice Roger B. Taney, wrote the Dred Scott decision.  But unlike the Jackson of 1828 and like the Jackson of 1984, Paladino has apologized for forwarding the e-mails.

Paladino's opponent, Rick Lazio, has been involved in marginally illegal activity in his role as JPMorgan lobbyist, and was very much associated with the bailout. Yet, he aims to get the state's fiscal house in order and clean up the state ethically.  Paladino appeals to non-racist Jacksonians in the Tea Party who are righteously indignant about the Bush and Obama administrations' massive transfer of wealth to Wall Street.  What is most puzzling about Lazio is his appeal to self-described Tea Party activists.

Mitchell Langbert is associate professor, Brooklyn College and is a member of the Ulster County Republican Committee. This essay was presented to the Kingston-Rhinebeck Tea Party on September 12, 2010.