If you are a sports fan — or just a follower of such
woe-begotten teams as the New York Mets, New Jersey Devils and my
Washington Redskins — you would think Philadelphia residents would
have plenty to celebrate. After all, the city’s sports clubs are on
a winning streak unseen since the late 1970s, when Mike Schmidt,
Bobby Clarke, and Ron Jaworski were scoring their ways into the
hall of fames of their respective teams.
But for residents of the City of Brotherly Love, the news
of lopsided victories and championship contentions are mere
distractions from the headlines of murder, corruption, and fiscal
malaise on the front pages. And Mayor Michael Nutter, who was
elected three years ago on a platform of cutting crime, reforming
government, and keeping the city on a fiscal even keel, isn’t
making any headway on any of these problems.
The bludgeoning of Nutter’s own neighbor,
Robert Lancaster, in his home earlier this month, and reports
of a possible serial killer strangling three women (one of whom
survived) were reminders that that Cheesesteak city’s streets
remain as bloody as ever. Although Nutter’s efforts — including a
two-year-long effort to confiscate illegal guns through a
controversial “stop-and-frisk” effort — have reduced some crime,
the city’s homicide rate of 23 per 100,000 in 2008 (the latest year
available) is still the highest among the nation’s 10 largest
cities; for six years running, it also has had the highest violent
crime rate among the nation’s big cities. Philly is just one of two
top 10 cities (Houston being the other) that has seen its homicide
rate increase between 1999 and 2008.
The city’s spate of corruption became more apparent last
month when the Philadelphia Inquirer revealed that the
city’s public housing agency
diverted $300,000 in fees collected
from Section 8 landlords ostensibly intended for training into a
lobbying fund.
The agency’s executive director,
Carl Greene, was fired a month
earlier over allegations of sexual harassment. The city’s police
department has also been rocked by corruption, including the
arrest earlier this month of a police inspector, Daniel Castro,
by the FBI for alleged bribery and extortion related to a $90,000
real estate investment.
As for the city’s fiscal condition? It’s in tatters. The
other week, Moody’s cut the city’s bond rating from A1 to A2
because the city must make long-delayed contributions to its
defined-benefit pension fund. The downgrade comes as the city plans
to issue $268 million in new general obligation bonds. As for the
pension? Its $3.5 billion in assets only covers 45 percent of the
annuity payments it must make to retiring civil servants, according
to Joshua Rauh of Northwestern University and University of
Rochester economist Robert Novy-Marx in a study released last
month; under Rauh and Novy-Marx’s scenario, the pension may go bust
in the next five years.
Meanwhile Nutter isn’t winning any battles anywhere. His
decision to enact a 10 percent property tax increase (among the
many tax hikes he has pushed through during his tenure) hasn’t done
him any favors. He has managed to revamp some of the city’s
operations — but without much help from the corrupt city council,
with whom he is sparring. He is also fighting with his scandals-plagued
predecessor, John Street, who maintains a strong (and inexplicable)
influence on local politics. In September, Street stepped up his
attacks on Nutter (and his penchant for race-baiting) by
declaring that Nutter was merely “a mayor with dark
skin.”
But Nutter’s problems — and the sparring among
Philadelphia’s politicians — are just endemic of a sclerosis that
has made it difficult for the city to revive itself in the way New
York City has done in the past three decades. Certainly
Philadelphia isn’t the only city struggling to deal with its
fiscal, governance, and quality of life issues. It isn’t even
Detroit, the poster child for systemic urban failure. But at one
point, Detroit was in the same position as Philadelphia before its
slide into abject decay. Unless it learns from Detroit’s failures
and from the successful revivals of cities such as New York, Philly
will become Motown with a Liberty Bell.
Philly’s reputation as one of the nation’s grittiest urban
centers has long-belied its nickname. After all, this is the home
of the nefarious Black Mafia — whose Nation of Islam-sponsored
sprees of graft and murder reached as far as
D.C. — notorious police chief-turned-mayor Frank Rizzo
(whose law enforcement tactics could be just as vicious) and
infamous fans of the NFL’s Eagles, who earned infamy for pelting
Santa Claus with snowballs — and have embraced controversial
quarterback Michael Vick with equal glee.
The presence of Fortune 500 companies such as cable giant
Comcast, insurer Cigna and pharmaceutical GlaxoSmithKline has
helped Philly stave off the kind of urban decline that has turned
its sister city, Pittsburgh, into a shell of its former glory. So
has Philly’s longstanding grip on power over Pennsylvania’s state
government, which has helped the city get state funding for some of
the city fathers’ pet projects; for the past eight years, it could
count on help from the statehouse in the form of Ed Rendell, a
former Philadelphia mayor.
But in the past two decades Philly has gone from simply
maintaining to a slow slide. It began with Rendell, whose
reputation for running a squeaky-clean administration belied
growing fiscal incompetence. While Rendell managed to bring down
crime, he engaged in such misadventures as pouring $70 million in
taxpayer money into a proposed urban theme park that was supposed
to be operated by entertainment giant Walt Disney. The site remains
a parking lot.
He also helped usher in the city’s deferred retirement
option program, or DROP, a pension curiosity in which a government
employee forgoes raises and incremental pension contributions in
his final years of employment in exchange for a lump-sum payment
upon retirement. Although the move was supposed to help the city
reduce its pension burden, the DROP plan has actually added $258
million (and even more thanks to a loophole that allows city
workers to double-dip, i.e. come back to work on the city payroll
after having retired). Among the big-check collectors: Members of
Philly’s city council including council president Anna Verna, who
can pick up a lump-sum payment of $580,000. This explains why
Nutter hasn’t succeeded in getting the council to roll back the
annuity plan.
A pension bailout by the state, technically still on the
table, is unlikely to happen, while Republican statehouse victories
— including capture of the governorship after eight years of
Democrat control and the state’s lower house — all but ensures
that there won’t be any help coming soon. Meanwhile Philly’s crime
problem isn’t getting much relief from district attorney Seth
Williams, who teamed up with local judges to
drop charges against 19,400 fugitives — including alleged
rapists and robbers.
Other long-term problems continue to mar Philly’s future.
The city’s public school system, which have been as much an
exemplar of systemic academic failure as better-known failure mills
as Detroit and Cleveland. Since a takeover of the district by the
state in 2001, the district has gone through an array of overhauls,
including the hand-off school operations to outfits such as Edison
Schools, and even the hard work of reformers such as Paul Vallas
(who began Chicago’s successful school reform effort).
But the district still remains one giant dropout factory;
just 60 percent of the city’s Class of 2009 made it from middle
school to senior year of high school, versus 74 percent of students
from the graduating class eight years ago. The superintendent,
Arlene Ackerman (a well-traveled school official whose previous
stints in D.C. and San Francisco ended acrimoniously) hasn’t won
over residents, teachers’ union bosses or even some school
reformers. Ackerman gained even more enmity in June when she
blocked information on
administrative salaries after it was revealed that she took a
four percent raise even as the district faces a perilous fiscal
future.
Nutter and other city fathers will need to take to heart
the lessons learned by officials in the Big Apple and other cities
that have seen revivals — including a focus on improving quality
of life and addressing crime with more than stop and frisk tactics.
Until then, Philly residents will have to move out or stick to
reading about the latest Flyers game while chomping down on Geno’s
(or, if one prefers, a Pat’s cheesesteak,
wit-out).
