Not Your Grandfather’s Patronage

Before the Trump Justice Department’s sudden order that federal prosecutors drop the case (for now), headlines fixated on alleged illicit payments to Mayor Adams and others in his administration. Yet this narrow conception of corruption neglects a more pervasive reality. A broader view, often embraced by the public when thinking about politicians, is one that operates in plain sight, with mutual back-scratching and influence-peddling taking place entirely within the bounds of law.

A sophisticated version of the latter view holds that an unpleasant side effect of democratic politics is the baked-in incentive for “corruption” or, more politely speaking, policymaking myopia. Politicians find that the best way to win and stay in office is to appeal to the shortsighted material demands of interest groups and voters: spending today and hoping to pay for it tomorrow. Such a present-oriented bias appears to be part and parcel of popular government.

It has proved a perennial challenge for New York City. The actors have changed, but the City’s fundamental challenge remains: how to balance democratic responsiveness with fiscal responsibility. Where once the Democratic Party machine known as Tammany Hall distributed government jobs, contracts, heating oil and food baskets in exchange for votes, today’s public-sector unions wield influence through sophisticated political alliances and collective bargaining agreements to secure better pay, benefits and work rules for their members. While the latter isn’t considered corrupt under the law, it is a soft form of self-dealing that perhaps reduces the need for more traditional pay-to-play arrangements.

Tammany Hall became famous in the late 19th and early 20th centuries for its massive get-out-the-vote operation. Precinct captains and ward heelers forged a coalition of established interests and new immigrants with various goodies to vote for candidates selected by the bosses. The system worked because in New York City — like in much of the rest of the country — political parties developed from the bottom up prior to the imposition of a top-down professional bureaucracy. The former easily overwhelmed the latter.

The downside was that corruption — or “honest graft” as Tammany operative George Washington Plunkitt ironically put it — was pervasive. Party bosses would reliably seek to exploit social welfare programs and building contracts for sources of constituency handouts, generating excessive spending. In the early 20th century, kickbacks to Tammany-affiliated contractors for subway construction and trash removal inflated costs. Moreover, the public workforce was a vast patronage operation where jobs were doled out on the basis of connections rather than ability. Plunkitt boasted of holding four public jobs in a single year — three of which paid him simultaneously.

Consider the Tweed Courthouse on Chambers Street, which is one of New York’s great civic buildings. William “Boss” Tweed, a notorious Tammany Hall leader, was involved in massive corruption during the courthouse’s construction. Tweed even purchased a marble quarry in Massachusetts and made a handsome profit supplying marble for the courthouse. Meanwhile, some of what appear to be marble columns are actually made of plaster. In 1873, he was tried and convicted in an unfinished courtroom within the building, marking his downfall at a high point of political graft in New York City. But Tammany lived on well into the first half of the 20th century — and even produced some great politicians such as Al Smith and Robert Wagner Sr.

A watershed moment came in 1958, when Mayor Robert Wagner Jr.’s “Little Wagner Act” — styled after his father’s famous federal labor law of 1935 — mandated collective bargaining for municipal employees. This reform, intended to break Tammany’s grip by cutting the machine’s ties to public employment, created a new power dynamic: Public-sector unions emerged as kingmakers in city politics, with the Working Families Party — one of their political offspring — now dominating the City Council. Union endorsements are today seen as key indicators of who will win mayoral races.

In addition to bargaining collectively over wages, working conditions and benefits, the unions now underwrite political campaigns for the city’s elected officials and organize protests when their interests are threatened. Given the power of the local teachers union, it is perhaps fitting that the Tweed Courthouse is now home to the City’s Department of Education. Of course, all such activity is completely legal — unlike the influence-peddling that has reportedly gone on inside Mayor Adams’ administration.

Public-sector unions in New York City have mastered the art of dual leverage: wielding influence as both workforce representatives and political power brokers. They also benefit from the city’s low-turnout, off-cycle election system, which amplifies their political influence. Research by political scientist Sarah Anzia reveals such elections systematically suppress voter turnout while disproportionately increasing votes by well-organized public employees. With union members a larger share of the electorate, it is no surprise that politicians pay them heed. Recall that only 26.5% of voters turned out in the 2021 primary cycle and a historic low of 23.3% in the general election that elected Mayor Eric Adams.

While not “corruption” in the narrow legal sense of a quid pro quo, many rightly see it as a corruption of the purpose of government, which is to serve the people rather than special interests. New York City’s public unions’ unique position helps ratchet up municipal costs, with union-negotiated premiums pushing compensation packages above what is necessary to attract and retain an equally talented workforce. The layering of collective bargaining agreements atop existing civil service protections has created a Byzantine system of work rules that hobbles managerial flexibility.

While union advocates celebrate these arrangements as victories for worker protection and economic equality, critics see a more troubling picture: escalating tax burdens and increasingly rigid public services that struggle to adapt to changing urban needs. Consider that costs for the Second Avenue subway are far above what prevails in similarly dense European cities.

The result is a governance structure that prioritizes employee interests over operational efficiency — a trade-off that grows more expensive by the year. While not corruption in the narrow legal sense, such practices exact a hefty toll on governance. When bureaucrats pivot from public service to private gain, the machinery of state falters. The diversion of resources and attention from civic priorities to sectional interests represents corruption as the public hazily understands it. Such a system is a recipe for frustration with and mistrust of city government on a broad swath of voters.

Consider that Mayor Eric Adams has faced stiff budget constraints due to staffing decisions made during his predecessor Bill de Blasio’s administration. Responding to his union allies, de Blasio significantly increased City workforce head count and raised wages through generous contract deals, generating substantial ongoing personnel costs. Indeed, New York City’s municipal workforce has swelled markedly, with full-time equivalent employees increasing from 267,423 in 2011 to 291,101 in 2021 — a significant rise of approximately 9% — despite a stagnant population base.

Despite a decline in public school student population, the city’s teaching workforce expanded from 107,625 to 119,210 over the same period — a 10.8% increase that raises questions about resource allocation within the municipal education system. Despite spending more per-pupil than any other state in the nation, New York’s schools rank in the middle of the pack on performance. While New York City’s traditional public schools perform creditably against state benchmarks, a substantial number of failing schools persist, seemingly immune to reform efforts. Such persistent underperformance raises pointed questions about the system’s capacity for meaningful reform.

It is often the case that the unions’ biggest enemy, according to journalist Richard Steier, is their own leadership. His investigative reporting has uncovered lurid tales of leaders bilking union accounts to enrich themselves (and their relatives) and rigging contract votes. The leaders of various locals in AFSCME District Council 37 — the largest public employee union — paid for lavish trips to sunny destinations, Super Bowl tickets and visits to strip clubs. Norman Seabrook, the once-powerful head of New York’s correction officers’ union, was handed a five-year prison term in 2019 over a kickback scheme that put members’ retirement funds at risk. Seabrook accepted a $60,000 bribe — delivered in a Ferragamo bag — to steer $20 billion in pension assets to a private equity fund.

At bottom, public employee unions’ goal is to transfer ever more resources from the private sector to the public sector. While the aims of more pay, increased benefits and better working conditions for middle-class public workers are laudable, they are insufficiently balanced against those of taxpayers, small businesses, schoolchildren and the users of City services. Everyone suffers from high costs and poor services — except perhaps the wealthy, who can insulate themselves from such problems by hiring private service providers.

New York City remains trapped in a governance paradox: Despite being a global hub of innovation and economic dynamism, the city’s municipal apparatus remains resistant to meaningful reform and is unable to deliver public services of a quality commensurate with their costs. Even the tenures of two transformative mayors — Rudolph Giuliani and Michael Bloomberg — proved insufficient to fundamentally recalibrate the City’s administrative machinery. Their combined two decades of leadership offered glimpses of potential improvement, yet the underlying structural impediments remained largely intact.

In a fit of fiscal desperation, the City today wants to gamble on marginal revenue sources. The turn to casinos and marijuana sales reveals a troubling fiscal strategy that betrays deeper economic challenges. These potentially socially corrosive industries represent a last-resort revenue mechanism, suggesting New York’s traditional economic engines are sputtering. The reliance on such marginal and controversial revenue sources signals a structural weakness in the City’s economic model.

Overall, brazen quid pro quo corruption, as seen in the Adams administration (notwithstanding the Trump administration’s current posture), has generally been on the decline in New York City, which makes its return so startling. On the other hand, the public’s broader notion that city government costs too much without delivering enough hews to older and broader notions of corruption dating back to the rotten boroughs of 18th century England.

Without structural reforms, New York City threatens to prioritize government hiring and compensation over service delivery, potentially undermining its long-term governance and economic vitality. The short-run demands of public employee unions and their allies will be satisfied. But the long-run losers will be the broader poor and working classes who rely on public services to improve their lives. The motives for myopia live on.