OPINION: Lessons for our next governor from former Gov. Carey

Robert Polner is the co-author, with Seymour Lachman, of "The Man Who Saved New York: Hugh Carey and the Great Fiscal Crisis of 1975."

'The hallmark of political independence," Hugh Carey once exclaimed at a rally of supporters in Syracuse, "is monumental ingratitude."

The ex-governor, now living on Shelter Island at age 91, had no small streak of political impishness throughout his more than two decades of service in Washington and Albany. In his seventh and last term as a Brooklyn congressman, he chose to enter the Democratic primary for governor against the wishes of four of the city's five Democratic county bosses, who backed the eventual party nominee, the much better known Howard Samuels. But Carey, an experienced campaigner, upended Samuels in the primary and went on to unseat Gov. Malcolm Wilson, the hand-picked successor of Nelson Rockefeller.

In his first State of the State speech in January 1975, Carey's maverick style was at the fore. Jaws dropped on both sides of the aisle as the new chief executive declared, "The times of plenty, the days of wine and roses, are over" - and dashed cold water on the habit of 18 percent annual spending increases.

The state, Carey pronounced, had good intentions and worthy social goals, but was now deep into a national recession, with massive job losses, and stratospheric inflation. Yet the government had been acting as if still flush with the federal assistance and industry of the Kennedy-Johnson years, he said.

"We were in the lead car of the roller coaster going up," the liberal Democrat admonished both parties, "and we are in the lead car coming down."

This coming January, the next governor will need more than a little Carey-like resolve and even mischief to unsettle the vested interests that treat Albany as a feeding trough, and to extract shared concessions and sacrifices so the state can once again be known for economic growth, social investment and innovative policies - no longer as the great swamp of ethics and dysfunction.

What might the next governor learn from Carey?

First, there's finesse. Carey worked well with others, never impugning the motives of his critics or investigating his adversaries. He balanced compromise and confrontation. While he could be withering to aides, he cultivated cordial ties with the Republican Senate majority leader, Democratic Assembly speaker and minority leaders. Union and business bigwigs also viewed him as a knowledgeable straight-shooter.

In today's highly partisan environment, when intemperate outbursts light up the Internet in real time, and the Capitol is lousy with lobbyists, amiable relations with legislative leaders may be even more important.

Then there was pragmatism. Carey didn't seek to leverage voter anger with a grandiose reform agenda. He instead set his sights on realistic improvements in areas where he felt a governor can make a difference, such as incentives to cultivate jobs and new industries, the judicial system, care of the developmentally disabled, Medicaid and pension expenditures.

Finally, ethics. The 51st governor administered a virtually scandal-free administration. Judging by his news conferences, he had the politician's gift of sinuosity and evasion - but not of dissembling. Though he presided in the wake of Watergate, voters took him at his word when he detailed the state's financial excesses and identified problems. He wielded his integrity effectively.

Crises shaped Carey's time in Albany, and he did not duck them. Just weeks after his arrival, the state's Urban Development Corp. - conceived to erect housing in distressed areas - defaulted on its bonds in a serious blow to the state's creditworthiness.

Far worse was New York City's dependence on short-term debt. By the spring of 1975, the big commercial banks in Manhattan refused to buy or sell the city's notes anymore, dispatching it on a hair-raising plunge toward likely default and bankruptcy - putting the state and its localities in danger of being sucked into a calamitous downdraft if the city collapsed.

Carey and his high-caliber aides mastered the three-ring circus of city, state and local politics (not to mention the press). To keep the city afloat, his administration sold bonds to banks and, critically, union pension funds; cobbled together stopgap aid from multiple public pockets with legislative approval, and suspended payments due bondholders.

He negotiated wage deferrals, raised taxes and imposed layoffs, service cuts and the first CUNY tuition. Such measures met the price President Gerald R. Ford believed city, state, union and bank leaders had to pay for fiscal waywardness. Carey, who knew everyone in Washington - Ford had been a House colleague - finally won $6.9 billion in U.S. Treasury loans for the city.

Andrew Cuomo or Carl Paladino will inherit financial problems that are even more intractable than the imminent bankruptcy of New York City. If the economy continues to be flat, the next governor will need to make the case for fairly apportioned expenditure cuts, tax increases and federal support. He will need friends in all sectors, public support for his depictions of New York's grave condition and the cure, and the political maturity to change and adapt as he goes.

Carey was far from perfect. When he left office after his second term, he was the target of much negative press coverage and legislators' chagrin. Yet if he had alienated the legislature with his tightfistedness, he also initiated the largest personal income tax rate cut in the state's history. If he had irked major health care providers, he also slowed the growth of Medicaid funding - which has not happened since. He also introduced a lower pension tier, saving the state billions of dollars on future employees' retirement costs.

Felix Rohatyn, a Wall Street deal maker tapped by Carey when the city crisis hit, said of him later, "He had a sense of humor, he was brilliantly intelligent, he was courageous, and he had something . . . President Franklin D. Roosevelt had, which is: If you do something and it doesn't work, you do something else."

Memo to the next governor: Are you listening?