A mayor puts empowerment to the test - Bret Schundler of Jersey City, NJ

0 Comments | Insight on the News, August 23, 1993 | by Kenneth Silber

For a while, Bret Schundler sounds very much like the Wall Street financial expert he used to be. The 34-year-old mayor of Jersey City is seated at a table in his office, telling a reporter about his program to convert the city's tax liens into an investment vehicle that will be sold to professional portfolio managers. Before long, however, the conversation takes on a philosophical tone, and the mayor sounds more like the clergyman he once considered becoming. Jersey City, Schundler says, "can become a light to the nation."

Both financial acumen and missionary zeal may be necessary if Schundler is to tackle the problems of Jersey City, an impoverished, crime-ridden city of about 228,000 across the Hudson River from Manhattan. Schundler was reelected to a four-year term in May, after first taking office in a special election in November. He is the city's first Republican mayor in 75 years.

His performance in the job could have an impact beyond Jersey City, influencing political developments elsewhere in New Jersey and in New York City -- and helping to determine whether the Republican Party has credible solutions for troubled cities across the country.

Schundler considers himself an "empowerment Republican" who favors enterprise zones, private-school choice and other policies that enlist markets, rather than bureaucracies, in the fight against poverty. Although such policies have been espoused by national Republican figures such as Jack Kemp, former secretary of housing and urban development, there has been little progress in implementing them at the federal level. Hence, Jersey City could become an important test of the viability of empowerment.

The test won't be an easy one. Although Jersey City's waterfront is dominated by glass office towers, a walk inland soon leads to dilapidated town houses, vacant lots and grim 1960s-style housing projects. Annual per capita income in the city is around $10,000. During the past several years, the municipal government has come under increasing fiscal stress. The end of the region's 1980s real estate boom resulted in sharply diminished property tax revenue; "Jersey City had a tough time adapting to that change," says Robert B. Edmiston, a director in the municipal finance department at Standard & Poor's.

Although it remains to be seen whether Schundler can bring about an economic revival, his presence in the mayor's office marks a sharp political change from decades of virtually unchallenged-democratic rule in Jersey City and elsewhere in Hudson County. The local Democratic organization's dominance began with the 1917 mayoral election of Frank "Boss" Hague, who is remembered in history for saying, "I am the law." During much of this century, the Hudson County Democratic machine was notorious for being able, in large measure, to dictate the outcome of local elections.

Schundler, who ultimately would break this political monopoly, was a Democrat himself early in his adult life. After graduating from Harvard University in 1981, he worked for two years on the staff of Roy Dyson, a Democratic congressman from Maryland, and then became New Jersey coordinator for the 1984 presidential campaign of Gary Hart.

Schundler moved to Jersey City in 1985, when he started to work for the investment bank Salomon Brothers. He subsequently joined C. J. Lawrence, an economic research firm, and in 1990 became a self-employed financial manager. These private-sector jobs helped convert him to a Republican worldview. "As you become more appreciative of the way the world works economically, you become less appreciative of some of the Democratic Party's inclinations," he says.

In 1988, Schundler cofounded the Coalition for Fair Taxation, a group that tried (and failed) to persuade Jersey City's administration to rethink a change in local property taxes that threatened to shift a larger part of the tax burden to low-income residents. For several years, he retained his Democratic registration, concerned that a Republican would have no influence in Jersey City's one-party political scene.

He switched to the Republican Party in 1991 and ran unsuccessfully for the New Jersey Senate. Calling for lower taxes, Schundler got 45 percent of the vote, about twice the percentage received by the Republican candidate in the district's previous election.

Another opportunity began to appear in February 1992, when Jersey City's Democratic mayor, Gerald McCann, was removed from office and imprisoned after his conviction on federal fraud charges. Several interim mayors held the office in rapid succession, and a special election was held in November to fill the remaining seven months of McCann's term. Nineteen candidates ran, including Schundler. The city's Democratic power brokers failed to unite behind any single candidate, and Schundler won with a mere 16 percent of the vote, a victory regarded by many observers as a fluke.

Schundler faced more unified opposition in the regular mayoral election in May. The new mayor's chief opponent, Louis Manzo, a Hudson County freeholder, was backed by both the local machine and national Democratic figures. As the election approached, Sen. Bill Bradley and the Rev. Jesse Jackson came to Jersey City to campaign on Manzo's behalf.