June 7, 2004
This interview of Newsom conducted by SFP Editor Savannah Blackwell was published October 29, 2004 in a one-time print edition of The SFProgressive. The interview was conducted June 7, 2004.
SB: Do you consider yourself a progressive? How did you feel when you were likened to President George W. Bush and Governor Arnold Schwarzenegger in your mayoral campaign of 2003?
GN: I’m always defending myself in terms of my progressive agenda, which by any other sort of national standard would be considered a progressive agenda. I’m the only conservative I’ve ever known or read about or heard about that’s pro-gay marriage, pro- choice, anti-death penalty, pro-stem cell research, anti-drug war.
I went through a litany of five or six things and it was the height of irony in that campaign when you do see yourself in pictures with Schwarzenegger and notably people like George Bush — cultural conservatives like George Bush — that people would lock into that based purely on the way they wanted to perceive you, not based upon on anything that in actuality could serve that agenda except perhaps cynicism.
So often we want to make it easy to love or hate someone. So you easily put them in one camp or another and it fulfills your vision or your point of view of that individual. And so I think because of Care not Cash — because of being associated with (former mayor) Willie Brown ... having been appointed by Willie Brown — there was that association that based on this, this and this then everything else falls neatly into place in terms of putting this person in this box or that box, or this category or that category.
And so it made it very difficult — a real struggle in the campaign, to say, “Wait a second. Here’s my view on this. Here’s my view on that. It’s consistent with yours – environmental view, a view of sustainability, not an aversion to new taxes.” It’s sort of phenomenal—fascinating in a political debate that was drowned out by a very successful alternative campaign. Very successful.
SB: Clearly you demonstrated in your selection of people to work on (projects such as homelessness), you recognized the interests of those who supported Gonzalez. To what extent did issues raised by that campaign — the notion that you’re not going to represent the common person — to what extent did that actually shape your administration?
GN: I don’t think it did. I never looked at the world as supporting Matt Gonzalez.
I care about people who care about the city, whether they agree with me in terms of supporting my candidacy or not, or agree with me on this issue or not. To me it’s irrelevant to the larger framework to which I have commonality with people who love the city. I love the city.
We both share the same ultimate goals and that’s to advance people, bring this city together and make San Francisco a world class city that stands for something and that is really a leader in the nation, and from that perspective it made it very easy for me to for example to each out to someone like Angela Alioto, who shares a passion for this city, who shares the same core values as a different means for which she can effectuate the same ends – which is try to get people off the street. Get them into stability and housing. Get them the support services they need. And help turn people’s lives turned around accordingly.
I’d say the same for people like the folks at the Coalition on Homelessness. They all have a role to play - an important role - and I’ve learned a tremendous amount from them. But it wasn’t shaped during the campaign. I liked what Ammiano said during the Brown campaign. He said a lot of the negativity, etc. and the consternation, which he was able to quite maturely overcome as he started rationalizing that defeat, was he said, “I chalk it up to temporary insanity.” I remember that always sticking in my head, and he had it perhaps in a different context.
But there is the campaign. The campaign is the campaign. And I’ll never base someone’s value — pro or con — on how they approach a candidate during a campaign or what they say in a campaign.
In terms of collective wisdom, two thirds of the people that are working on the affordable housing effort, I’m sure two thirds maybe three quarters opposed me. But they have value to add. They have a voice that’s important and we both share the same goal: to provide housing at all income levels, or at least most of us share the goal of housing at all income levels. Some exclusively supportive housing. Some exclusively affordable housing. Some exclusively home ownership. But in between there’s a lot of commonality. And my goal is to try and find that. And that’s how I’m trying to approach everything. In trying to bring in people who disagree with me. I find great value in that.
But I’ve done that all my life. I’ve done that in my business. I’ve done that in my politics at the board. And I will continue to do that regardless of what happens to me as mayor or when I get back to work outside and open a nonprofit or something.
SB: You grew up with dyslexia, went through a divorce – but clearly while dealing with that you also had a great sense of personal ambition and desire for public service. At the same time, there was that insecurity. Certainly you showed that when you started at the board, and clearly you have grown a lot.
GN: Well I was 27, 28 years old? Come on. I was very young. I mean, politically, very young. Though I think had done a lot in my private life. So I was hardly without skills or competency. But politically? No. Certainly this was all new to me. And I had much more of a focus on broader political issues.
I grew up in family -- I’ve been thinking of Reagan these last few days, who sort of defined my political perspective in opposition to somebody. So I can understand why some people define their political identity (as) in opposition to me.
Now sort of looking back at that, I hardly think it served as any nobility. Meaning it’s very easy to be opposed to somebody or something. It’s very difficult to be someone who tries to put something together and advance something or a new idea.
Literally, in the last 48 hours I was thinking so much of my formative political view of the world. (That) was during the Reagan years and my opposition to Reagan, my defense of Jimmy Carter, right when I started coming of age and I started paying attention to these things. It’s interesting. Especially when I look back at the old tapes and the comments and remember all these things. Very, very profound. Needless to say I’ve learned that nuances of people, in policy, the challenge is the gray areas. The world’s not black and white. It makes it more challenging.
SB: When you’re wondering what to do, or are having a moment where you’re not feeling strong, is your relationship with your father something that helps you stay solid?
GN: Yeah, though I mean --
SB: Did he encourage you?
GN: No, he never encouraged me to get into politics. He encouraged me to be politically active. Big difference. He had a bout with political ambition early on. See the picture back there of him and Bobby Kennedy, when he was running for (California) senate against Milton Marks? And so that drove a lot of my early advocacy. Remember, I grew up around a household where there were three boxes of envelopes I had to lick. At seven, I’m thinking, “What am I doing? Who’s this guy?” We got involved in the grass roots level early on, and I would show up and volunteer.
So I was always politically involved – Tom Bradley’s campaign for governor – I remember that early on. I really thought I got involved in it. Though I probably didn’t do anything more than licking those envelopes. But there was always that political activism.
My grandmother and her family—very politically active.
You ever want something interesting on my progressive side -- my mother’s family, the Oppenheimer -- the Menzies side of my family. Arthur Menzies. If you ever do a little google (search) on Arthur Menzies. Interesting guy. I’m not sure it would be in a google (search), but it would in a lexis/nexis search. We have huge FBI files on the family, when the FBI was tracking that side of the family. Very progressive side of my family. It’s my aunt Sidney who’s married to Ed Asner. Sort of that side and my grandmother. Very politically active. Very progressive. My father more sort of the Pat Brown, more moderate Democratic wing, more traditional. Truman. Brown. That side of the political fence.
So you know, I kind of grew up with both sides of that spectrum.
SB: When did the possibility of becoming mayor first occur to you?
GN: Never occurred to me until not that many years ago. Being mayor. Proper. Being in politics I thought about as a young child. But I never specified. You know, you sort of as a kid, you sit there and you’re debating in your class, you’re President X, you’re President Y, and you’re having fun in the eight, ninth grade. That was my passion. That’s why I went into political science. That’s why I was really focused on social studies -- because of the political aspects in high school. Those are things I did well in. And I didn’t do well academically in anything else because it wasn’t my passion and because I struggled because of the dyslexia.
So I’ve always been driven by my passions. And I always say you’ll never be good at things you don’t love to do. And I never was. I’m only good at the things I love to do. That’s why I love business. I love restaurants, wine. I love hospitality. I love politics. I love policy. When you talk about the difference between truly successful people and those who are not so successful, it’s interest versus commitment. And interested people find excuses. Committed people find ways of getting things done. I’ve felt that this job, it’s life consuming. It’s my passion. It’s my purpose. I’m fully committed to this job. And I like to think I can find ways of getting things done. And that’s why I’m not very good at listening to excuses or extending comments explaining away problems and things.
(Note: A meeting of Newsom’s inner circle, including longtime aide Mike Farrah and campaign consultant Eric Jaye, occurred sometime in 2001 during which allies kicked around possibilities for Newsom’s future. Making a run for state assembly was shunted aside to going for the mayor’s office, according to a Newsom insider.)
SB: You and I used to go round and round during your first days of your tenure on the board. And that’s when you told me, “I admire Bobby Kennedy.” Because I was basically saying to you, “What are you going to do? You have this incredible opportunity to represent the youth of my generation, our generation?” And you said, “The Kennedys. But the example they provide is of somebody fairly well off”--
GN: (interjects). That’s the difference between the Kennedys and my family. We weren’t and aren’t (well off). They are.
SB: What do you think you could cite out of the first five, six months of your administration that reflects on that approach to leadership?
GN: The organic side of Bobby Kennedy’s leadership. The policy that was driven through observation, through a sense of understanding, a capacity of understanding. Not intellectual.
SB: Let’s think about you going out to the Bayview.
GN: That’s it. Trying to just, removing the pretense in trying to understand a problem. As Bobby said, “Try to find a wrong and try and right it.” The desire to understand. An empathy. An expression. A capacity of an expression to understand. Recognizing that your life experience may be different, but never denying that you can, on some level, have the capacity of understanding. That can make you rationalize and understand and then begin to approach a problem and fix it. Bobby Kennedy, when you read his speeches directly, and I’ve read like 100 books on him, it was very pragmatic leadership. It was hardly ideological. It was open to argument and evidence.
For all the criticisms of the Democratic Party of late, the sort of Clintonian policies, he was the originator in many respects of those. You read his early stuff on welfare and the inner city. It’s prescient. I can read those speeches today and people would say, “Yeah you get it.” He was a hard-headed pragmatist. And I like that. That’s what gets me in trouble, right, with Care not Cash. People ideologically don’t like the notion of taking away cash from poor people. That (the cash grant) is somehow going to advance their personal lives. I can assure you, there’s 298 people whose lives have been advanced exponentially because we had the courage to change.
The sky hasn’t fallen in. Not everyone has slipped through the cracks. Everything they said would never work has not come to fruition. Have there been mistakes? You better believe it. Some have been frontpage headlines. Had a pretty intense conversation this morning with my staff saying I was meeting a guy out on the street. Here’s his experience. Why in the heck did this happen at this drop-in center? That’s inexcusable. I didn’t have to wait to get that into the paper. By the way, I’ve been spending a lot of time out on the streets talking with people seeing how they’ve been impacted -- so I can get a more one-on-one understanding.
SB: How many people (have been put through Care not Cash)?
GN: Can’t remember. It’s hundreds. We have 380 units now on line, we did the second big, 81 units last week, did 299 the first month I got into office. We’ll have 939 by the end of the year that will be on line. We’re slowly doing this. Cart before the horse? No. We’re making sure the process is thoughtful. Will there be mistakes? There have been already. Will we do everything to correct them? You better believe it. I don’t need a hearing at the board to try and be proactive. Hey, if we do something wrong, we’ll fix it. And I always say, if it doesn’t work, I’ll be the first to unravel it. I’m interested, again, in evidence. Those are the kinds of things. That I think is what I’ve taken away. That hard-headed pragmatism.
(note: On Oct. 21, Newsom said his administration has added 776 units)
SB: We’re talking about homelessness as an issue. This goes to the point that progressive readers are really going to be wondering about which is. “Okay, so he has Paul Boden on the task force.” Are these folks going to have a real influence in the policy that comes out of it?
GN: I hope so.
SB: I’ve already heard some criticism from the coalition that when you announced you would be doing outreach – that their outreach committee (of the homelessness task force) didn’t even know what was happening yet. Had to be consulted about it later. It’s essentially the feeling that, “we feel separate from the implementation of policy. We don’t really feel like we’re influencing what’s happening.”
GN: I don’t know. I appreciate the criticism on the outreach. And I grant that. We actually did send the plan to the committee. And respected that process. I tell you what I won’t do. I’m mayor of SF whether people like it or not. And I’m accountable, whether I like it or not. At the end of the day, it’s not the committee that’s responsible for homelessness. It’s me. Because at the end of the day, I will be identified with its success or failure. And I feel a great sense of responsibility when I talk to someone on the streets. Right out in front like the guys were today with all their carts and things – to do something about their lives. I can sit there and process that and have hearings on that or I could try to do something about it. Sometimes people will like what I’m doing. Sometimes people won’t.
But I also appreciate points of view and differences of opinion and I read. You know, I think I’m actually one of the few people to read, word for word, the Continuum of Care plan. I could tell you in detail what’s in there. So their work is valuable. Even if I disagree with certain conclusions, I will read word for word. In fact, Angela (Alioto) left a long voice mail today. They were writing until 1 in the morning last night. They’re putting a ton of work into this. And I will value that work and I will use it as a guide. And she’s quite honest with me. She calls and says, “I’m not sure you’re going to like this, but what do you think of this?” And I say, “Hey do what you think is right and give the plan you think will work, and I will do my best to work within the framework.” And there will be times when we agree to disagree.
But I want to see what this vision is and how we can advance it. And we share the same ends. Focus on chronic homelessness. Focus on the two to three thousands people that are chronically homeless out on the street. Try to get them direct access to housing. So we don’t have to waste our time re-enforcing the failure of our shelter system by expanding the system of temporary assistance, as opposed to advancing the system of permanent assistance. We have some models in this city that need to be replicated, like the master lease program. And so those are core principles that are being advanced in this document already that I share. Do I agree with some who say we don’t need outreach teams? I don’t agree with that.
(Note; The Coalition on Homelessness still has some sharp criticism of Newsom’s policies. Staffers there point out that Newsom’s “Care not Cash” plan addresses only a small portion of the homeless population, and that it hurts more welfare recipients than it actually helps.)
SB: Will those teams be permanent?
GN: Yeah, it’s in our budget. Now there will be a lot of people who will want to take it out because they want to send a message, and I’m expecting and anticipating all of that. But like everything else, I hope to be given the tools to succeed and not be hamstrung. How about a city where you have thousands of people on the street and you have no outreach whatsoever? That’s what some people are arguing for. I find that stunning. And their argument is well, “We have people in the jail already that are chronically homeless so we don’t need to do the outreach.” But if some guy’s suffering out on the street with a bottle of booze as we were doing our own outreach, and we just step over him—? Where’s the humanity in that? I want someone I can call and say hey, “Help this guy. Get him into the sobriety center. Get this person into a program. Get this person some SSI advocacy. See if you can get them off (government assistance).”
SB: Ok, let me just switch here to the big question I think that I progressives have, which is, “Ok, we’ve seen that Gavin Newsom is willing to take a controversial and brave stand on social policy issues, that being gay marriage (and more recently hotel workers’ rights). What about as someone who’s benefited by the federal tax cuts, saying, “Hey, I’m somebody who benefited. Let’s talk about Proposition 13, and repealing rent control on commercial property. I’m willing to say, ‘We need to pay more. We’ve got a $350 million deficit.’” I know who supported you. I know who helped bring you here. But I also know you have principles. Couldn’t you turn that around and say, `` I’m going to make some demands here on downtown and wealthy interests. I’m going to use this position as a bully pulpit and say, `Cough it up!’”
GN: But Savannah, wait. The second week I was in office I went to the Chamber of Commerce and said, “Get ready. We may have to close this budget deficit with a revenue package. I’ve advanced three revenue ideas. I haven’t heard anyone else advancing any sort of revenue ideas. I’m sort of out here on a limb on this thing. I haven’t heard any big hearings with the exception of to his credit, Supervisor Tom Ammiano and his office has been very helpful with that. We have taken that stand. We have advanced that. We’ve been very consistent and honest throughout the last four months. I’ve been working with the business community saying we’re all in this together. Labor gave back with $53 million this year. That reduces the stress on this bureaucracy and allows us to fund core programs. What, in turn, then can you do to advance this effort in a way that doesn’t stunt job growth?
And here’s my point. There’s no reason to advance a tax package that drives people two blocks into San Mateo County, a quarter mile into Marin or into the East Bay. We’re not an island. And while I disdain Bush’s economic policy, which can be construed, extended simply as tax cuts – I mean there is no economic policy. While I don’t like what Schwarzenegger has done and have been very vocal and critical. By holding a no new tax pledge while he borrows against our great, great grandkids’ future. Where he says I’ll take $15 billion, but you’ll have to pay back over $30 billion over a 30-year amortization on these bonds. I find that outrageous. And I’ve said as much, consistently said it on TV, radio, privately, publicly, everywhere I go.
And now we’re left in a city where we’ve got to deal with those realities and those constraints, and we’re dealing with companies that could easily move, and would be more than happy to move and have been moving quietly. As a consequence, we’ve lost 65,000 jobs. And for every job we lose, we lose $1,700 in annual revenue which goes right to your Tom Waddell clinic, where you’ll be writing about some of those cuts. Or to Senior Action Network. Or to the adult and aging (programs).
SB: So it’s $25 million you’re talking about getting out of the new gross receipts tax?
GN: It’s $50 million. It’s $25 million for the rest of the fiscal year. There’s three taxes. There’s closing the loopholes on the LLCs. And the reconstitution of the gross receipts tax, which is within the parameters of the lawsuit and settlement so it can be legally done. Then there’s the sales tax. All told, we could not, I could not tax. Only the public can tax themselves. They have to determine what kind of taxes they support. And we can advance them and we should do so with some consideration, meaning we can throw things on that will lose. And we then can all applaud ourselves for being big champions of nothing -- even though it could have been something if we had worked to take a smaller bite of the apple and worked with people.
And so we are looking at annualization of those three taxes in excess of $50 million dollars — $25 million, again, because it would be mid-year after the voters supported (the measure), then we would go in at the middle of the fiscal year and generate $25 million dollars for this fiscal year. Part of that is gross receipts, LLCs another $8 to $11 million. And the sales tax, which is another $8 million – going up to $27 million.
SB: So Labor is being asked to give back $50 million and you say through gross receipts businesses are giving back roughly the same amount?
GN: Well, on an annualized basis, through the gross receipts tax and the LLC loophole closure, which affects business. And I never understood (the term) “downtown.” I think that’s just a figment of popular imagination in order to create the “good vs. evil” scenario which is so trivial. I mean, there is, it’s the business community broadly speaking which by the way would include some of my old businesses on the gross receipts side – hardly are we downtown. We’re in the neighborhood serving the neighbors. And there are thousands of other businesses that will be equally affected. The vast majority of businesses will not be affected by that, which are truly the small businesses, which serve our neighborhood corridors. But it’s not downtown vs. the rest of the city. It’s the city. It’s the business community.
SB: What do you think about Rob Reiner’s proposal to raise the tax on commercial real estate?
GN: I’m going to be with Rob on Monday. Doing a big fundraiser for me in L.A. He was up here two, three days ago, so you can imagine what I think. I think he’s doing a lot of good work.
SB: Would you be willing to use your position (to push for the proposal)?
GN: He and I are going to be talking about that Monday among some other things. He’s got some other ideas, too.
SB: Because that’s what I’m pushing here. You’ve done this incredible thing with social policy, civil rights. You could use your position—
GN: You mean sort of take a Warren Buffet stance?
SB: And you don’t have Arnie to slap you down. If you did that, Gavin, you would turn the Bay Guardian -- the criticism — on its head.
GN: That never would happen. I’m never going to be progressive enough. There will always be someone more progressive, more ideologically pure. I’m not an ideologue. So I’m easily swayed by someone else’s argument – if it’s a good sound argument and it’s based on evidence ... what’s working. Pure ideologues, they’re interested in power and advancing an ideology, not in having open-mindedness. Look, taxes were my last resort. That’s exactly how I implemented my strategy on this budget. At end of day there was a gap. And the choices, I didn’t like. Because the choices truly would have hurt people and taken away some of the core programs that make this city a special city. After that, you know, there was no choice. It wasn’t my first answer. And by the way, it’s still not. There’s still a lot of waste and inefficiencies.
SB: So what should I say if people ask me, “Is he willing to take a stand on raising taxes on big business?”
GN: I’m a mayor of San Francisco that’s not only willing to, but has. That’s demonstrated his leadership. I don’t know what more evidence you need than a mayor who submits the budget, who talks for more than an hour and says exactly what he’s going to do on every single thing. And says, “And we’re going to close this gap by raising taxes on businesses and corporations and LLCs.” And also ask that, broadly speaking, at the end of the day we all share in the pain because of the failed policies of the Bush administration. And the ineptitude of the policies in terms of common sense. And an unwillingness to gravitate to reality of the Schwarzennegger administration as it relates to holding strong and firm on a “no tax” pledge that’s going to hurt people. And has hurt people because it’s exacerbated our budget deficit. And hurts those most in need and those most vulnerable.
Businesses ultimately end up paying. And that’s the absurdity of their policy. It’s political. That’s a political point of view. Ours is dealing with reality. And it’s hardly the leadership of the Democratic Party that supports taxes. I’m happy to be the fall guy on it. I’m on record supporting tax increases for business.
AB: I just wanted to interject here. In terms of “progressive,” progressive means different things to different people. To me it means wanting to preserve the character of our neighborhoods. And as someone whose businesses have been very successful, who could have been hurt by one moving, what’s your position on chain stores?
GN: I don’t like chain stores, but I think there should be self-determination in communities in neighborhoods that do embrace the economic benefits of having a local chain. I mean, one person’s chain is not another person’s chain. I see a lot of people with Starbucks coming into City Hall that tend to oppose chain stores but tend to like Starbucks Coffee. I see a lot of people getting a burger down at Burger King or MacDonald’s but don’t like (those) chains in terms of intellectualizing it. I think the notion, “Do we deny Safeway in a community that’s been under served?”-- Well, I don’t think that’s the intent. So I don’t have an aversion to chains broadly speaking. Where there’s self determination. Where there’s need. Where there’s a desire in the community to advance a business anchor in their district.
There were no chains that got into District Two. In the seven years I was on the board, we stopped them all because the community did not want them. I don’t think San Francisco’s character is advanced by a proliferation of chains. At the same time, there are districts in this city that are desperate for some kind of economic stimulus and an anchor. That would love a Subway store. That would love a Peet’s coffee. That would love a Pasta Pomadoro or Pluto’s. That would love a business that was founded in San Francisco like Banana Republic or a Baby Gap in their district that may not be advanced because of some of the legislation. So it’s one of those mixed bags. I didn’t like that legislation, but I didn’t veto it – because I understood the legislation. But I think there’s unintended consequences. And I think we need to be cognizant of that.
Part Two: June 30, 2004
SB: We were at the heart of the interview, what we were talking about last time. We were crediting you with the incredible stand you’ve taken on civil rights issues. On the gay marriage issue. And I was saying, “Ok. Basically what you’ve always told me all these years is that you are a progressive. You consider yourself a progressive” --
GN: On social issues, yes.
SB: Yes, and that the Bay Guardian, if you will, (you insist) never had it right, and this is on the economic issues, and so I said “Ok, You’ve done this with the social issues. So why not, if you wanted, you could use the role that you have -- and you do have a particular, I would say, credibility with the business community -- you’re a businessman yourself -- use the office as a bully pulpit, if you will, to really push on economic justice.”
GN: Sure. We’re doing it. But we’re doing it, I guess, not using a sledgehammer approach. We’re not trying to embarrass — not trying to condemn — the private sector. Nor try to make a political statement. We’re actually working with the political sector to, for example, advance more philanthropic support for our efforts across the board. We’ve been engaging for job training and job subsidies. We’re engaging the private sector in our efforts around homeless reform. We were going to announce that there were about 15 companies that helped with the 10-year planning process. But we had to sneak out early before we could acknowledge all these groups.
We’re starting to reach out in a way we haven’t before to get these companies to participate in much more significant ways.
Now, that’s just one part. But, more substantively, let’s recall we’re supporting a tax package here that I’ve introduced to the board that I’m now reaching out to the business community and trying to get them on board. The business community has demonstrated a remarkable ease and ability to defeat tax revenue packages. This is not going to be very difficult for them, I think. This is not a time when everyone wants their taxes raised, generally. People don’t want to pay more, because they don’t have a job. They don’t have as many opportunities. They’re not getting paid as much. Their own cost of purchasing anything is more expensive. Rents are still high.
So my point is only this: We’ve gotten them to agree not to invest any resources to defeat our efforts. And in some cases, we’ve gotten them to agree to help us with some individual business leaders. Now I would say that’s a fairly progressive economic policy. To actually have the business community out there saying, “We don’t mind being taxed $50 plus million dollars.” You know, I can assure you this has not been easy.
SB: Who advises you?
GN: I don’t know, I probably have thousands—probably have one hundred people advising me. Two hundred.
SB: When you really need to know, “Ok, What’s the threshold?” --
GN: See, there’s no person. I get this all the time, you know, who advises me. There’s no person. There’s so many people. I’ve always been a guy, you know—I talk to 20 people and that’s my collective, cumulative advice. But I won’t always talk to the same 20. I talk to people who are experts in this, and they’re the new 20. And then I talk to people who are experts in this, and that’s my other 20. And then it’s just using judgment. On the polling though, we also — we’re naïve. We did some polling. We went out and said, “What is the threshold to the public?” I mean it’s great to have a tax package, but --
SB: On the sales tax?
GN: Across the board. We did polling on everything. Residential utility taxes. Parcel taxes. Property transfer taxes. Payroll taxes. Gross receipts taxes. Sales taxes. We had a couple other taxes. And there were two sets of polls. I wanted to compare and contrast. I didn’t pay for it. But we asked some groups that were doing some other polls. We did part of a housing bond poll.
SB: Did SFSOS do one?
GN: No, they didn’t do one. I’m not sure they did one. I didn’t ask them. One of them was a Binder poll. But that was on the housing bond. The reason they were hired was to do the housing bond questions and other stuff
SB: Was this happening early in the year?
GN: Oh, I don’t know how many months ago. But apparently there have been three polls out there that people are always referring to on that. Just to try to get a sense, “Are we completely off base on this?” “Are we within the ballpark on that?” So you can frame something that’s possible.
You know, again. I think some people think there’s great nobility in futility. But I don’t believe in that. I could easily submit something that I know will lose so everyone applauds me. And then nothing gets done. And then I’m a hero to that constituency. I don’t operate like that. I want to do something. It’s like the housing bond. I want to do something that can win so that we’re not doing a Prop B where we all go boy, “Coulda, Woulda, Shoulda.” And at the end of the day we have nothing. So, I’m trying to fashion something that can win. But based on my dozens of conversations we’re stretching some of the folks in the business community. You know, I’ll tell you this is remarkable. I’m not patting myself on the back. I don’t know how many mayors can convince the business community that in some instances individuals or companies are going to pay $2, $3, $4 million more a year in taxes that it’s in their best interests and the city’s best interests when they could easily write a $2 million check up front to defeat it. There are companies that think this will be the impact. And they think they’re already paying too much.
I know others that no one thinks the business community is paying a lot. They think, “We’re the only folks paying the payroll tax in the state of California. We’re the only ones that have all these other taxes and these hidden fees and other charges. They feel very strongly that they’re paying more. I’m not saying that’s accurate or inaccurate. I’m saying that’s the mind frame or framework of some people.
SB: Last time you said you were looking at the budget and you saw what kinds of cuts it would take to meet it without going to the business community for taxes and that was not acceptable to you. Since we’ve talked there’s been a lot of testimony, coverage, media reports on the potential impact of the cuts to (the Department of Public Health).
GN: Yeah, it was $37 million. We’re hoping that with (Budget Analyst) Harvey Rose and the add-backs we’re hoping we can get some good news and start restoring those cuts. I made adjustments on Tom Waddell and some of these satellite clinic efforts. That slipped through the cracks. I’ve always said what with those piles and piles of budget papers that things might slip through the cracks. And that’s why we wanted to do a July revise and start making these adjustments. We don’t need to wait for the board to make those.
SB: Have there been some adjustments since that June 15 hearing that was so emotional where so many people came forward and said, “You’re going to lose this many services to homeless people” --
GN: There’s been seven or eight. We made a big adjustment on those satellites. And we’re expecting and we’re hopeful that through this process that some of the other concerns will be dealt with at the board. We’ll be watching, meaning I’m in a position where I can fill some of these voids.
SB: Let me show you something really quickly. This is what Jennifer Friedenbach’s presentation was from the Coalition on Homelessness on this, and this is what she’s saying will be the impact of some of these cuts. That doesn’t look acceptable just from a “getting smarter and reorganizing” kind of point of view. So we’ve got $50 million coming from labor, $16 million from gross receipts tax, realizing it will go up --
GN: Wait, wait. We can’t tax (for a period of time prior to voter approval). I can see the numbers but it’s sort of an unfair comparison. Because we can’t start tomorrow and say --
SB: Well it depends on whether you think it’s fair to say, “We’re just going to look at fiscal year 04-05” and into this budget goes $50 million--
GN: This is a three-year budget.
SB: Well what would think of pushing the gross receipts tax up to .15 (instead of .1)?
GN: I’m just telling you, my own opinion is that if you do that you’re going to have strong opposition to both taxes. And I think you’ll lose. Who’s going to put up all the money to run the pro-tax campaign? I mean, truthfully who’s going to run that campaign? If labor steps up, I can assure that dollar per dollar, they’ll be outspent five to one by some of these companies that will feel like that’s too much. And again, I’m not arguing if it’s too much or too little I’m just telling you about the conversations where we’ve been told it’s all about balance. We’re still having a hard time with this LLC, LLP thing. Now more people are coming out of the woodwork, who’ve started to figure it out and are coming in here. They’re coming in here everyday saying, “I didn’t realize this.” They’re starting to do the math themselves. They’ve got their own accountants. There’s going to be a group that’s being organized to oppose these taxes even at the point that we got some tacit agreement. So this is hardly going to be smooth effort. But you start raising it beyond that threshold and that thing falls apart.
But hey, you can be a great champion – it’s great politics for someone that has an ideological perspective to say, “It should always be more” because right, it always should be from their perspective. But you’ve got to deal with reality. And the reality is, “Let’s not make the perfect the enemy of the good.” We’ve got to move forward, we’ve got to start approaching these things in a rational way. And we can get enough to get us back on the road of fiscal recovery. Start reviewing the impact of these taxes. The Controller would be the first to lay this down. We don’t know exactly the impact of these tax increases. We don’t know what it means, because we don’t have the data. The idea is to collect that data over the next few years and then really look at reconstituting our whole tax package.
SB: Are you still proposing it as a five-year sunset?
GN: Well, I think it should be a sunset so we can get that information. I think it should only be four years, because if we’re going to sunset it we need to sunset it during a general election so that we can reconstitute it during a general election. Because my goal is not to do – for those that believe I have sinister motives – just four years of taxes. I think we need to get back the resources we were receiving on the gross receipts (tax) permanently. That’s to me baseline.
SB: $200 million lost over four years (because of the corporations’ suit over the gross receipts tax)
GN: It hasn’t been four years. There was a settlement. I’m not sure on those figures.
SB: That’s from Marc Norton (San Franciscans for Tax Justice). He’s got a slam on you, saying you’re easier on Walter Shorenstein (the downtown property developer who has heavily backed Newsom), because the real estate tax was figured differently.
GN: (Smiles) Now, what did we do? People who come up with these things, I guess it makes them feel good. I’ve got to read this now (laughs). Well, you know I did go into negotiating with Shorenstein that .1 percent – because he gave me that $500.
SB: And you’re first job, right?
SB: You met with Rob Reiner. It sounds like that’s not happening – standing up on the issue of commercial rent control and Prop 13.
GN: It’s not right now on my radar screen. There are about 85 other things that are on my radar screen. And I mean that. You can’t do everything. My biggest priority right now is section 8 housing. I went to the U.S. Conference of Mayors and got a resolution passed by Republican and Democratic mayors across this country to send a strong message about these block grants and these cuts.
SB: You’re trying to fight (Bush’s) section 8 cuts
GN: Did. Flew out to Boston to get this resolution passed. Right now, my next battle with the state is in fact it’s the big city mayors we want to work with Gov. Schwarzenegger to him to step up on these section 8 housing cuts. That’s my number one priority.
SB: Step up meaning --
GN: He’s got to get involved. He’s got to send a message to the Bush administration.
It’s going to hit California more than anywhere else. The point is, you’ve got to pick and choose your battles. And I’ve got to deal with so many challenges right now, crime and violence, homelessness, housing – get that affordable housing bond passed.
(note: In his Oct. 21 speech, Newsom thanked U.S. Rep. Nancy Pelosi for her help on the Section 8 housing issue.)
Some people don’t think about this, because they don’t have the responsibility. They say ok, “We want more taxes without considering -- if we’re going to go after those companies, and we want to get a housing bond passed and we want these guys to pony up for these dollars -- what impact is that going to have?” Are we going to kill the taxes and the affordable housing bond and kill this and potentially kill that? There’s cause and effect. There’s cause and effect, and it’s the reality of life. And it exists in our personal lives as well as in our professional and public lives. And you’ve got to deal with those realities.
I’m trying to get money as well from these folks. I’m going to. A lot of people are going to try, but we didn’t raise a lot of money for Prop B (the failed 2002 Housing Bond). To get two-thirds (vote) on this housing bond, which is just my absolute first priority, is going to take an extraordinary effort. And you know what? I’d say it’s 50/50 in the best case. And it’s going to take a concerted effort, a collaborative effort. It’s going to take a lot of money to win that campaign. And I’m going to be reaching out to these same folks that I’m taxing. This is not easy.
SB: What about the (San Francisco Association of) Realtors’ (position on the housing bond?
GN: Right now, they look like they could be going south. They sent a letter two days ago suggesting that what the board passed, they’re not going to be supportive of. I’m trying to get some neutrality, some consideration. I mean they may go after the tax (increase). We’re trying to hold together a whole coalition and produce a result, as opposed to produce more hot air and rhetoric.
SB: What are your main goals over the next year? What do you hope voters who identify themselves as progressives, or even those who voted for Matt Gonzalez, will conclude about your administration?
GN: Which is 95 percent of the people reading this. You can quote me on that. I’m planning a lot of things, and we’ll be announcing a strategy in terms of where we’re going in the next six months. Where we’re going to take this city over the next six months. The purpose of that – is that we’ve got to get through this budget, we’ve gotten through the labor negotiations, we’ve advanced our core causes on homelessness, we’ve advanced our core cause on housing. And we’re trying to get some structural reforms on this ballot, get our economic house back in order. Yes, go out, try and recruit new businesses. Yes, try to retain existing business and help businesses grow so that this revenue stream comes into the city so we can support these social services we all hold dear. And the next stage is to go out and complete our efforts on all of those policy papers that people love to hate who didn’t support me and that people love to embrace – those that did support me. Trying to implement those strategies. We’re going to advance universal health care for zero to 24-year-olds and advance a local earned income tax credit. We’re going to continue to streamline the operations of city government through SFStat and getting the 311-call center up so we can provide a much more transparent bureaucracy. All these things and many many more specifics we’ll be announcing in the next few months.
SB: So what do you hope that people who were buying into the notion that you’re like Bush will conclude?
GN: I don’t know. They may conclude today I may not be like Bush. But they’re probably cynical and expect that tomorrow I will be. I don’t know. I told you this before. I’m not an ideologue. I’m open to argument. I’m interested in evidence. I want to produce results. I claim no purity to my cause. I share many of the same ideals as the progressive community. My mandate as mayor is to produce results and manifest those ideals. And that’s where the controversy arises. That’s where the consternation occurs – is in how do you get there? I want to create a road map to create real progress and real results. And some people are going to disagree. Some people are going to agree. I hope to do it in a spirited way. And in a cooperative way. And not assess cynical motives for all actions. It’s trivial. I don’t have the energy to get involved in these kinds of conspiracies. It takes you away from the hard work. There’s a lot of hard work in this. I don’t spend my time in chat rooms. I don’t spend my time with Joe O’Donoghue figuring out how to take away people’s goals and advance a subjective one. There’s some folks on the left and the right in this city who I wish would just start their own separate government someplace else so the rest of us can live in this one. In peace. You know, I mean that. I’m just trying to remove some of the extremes, some of the hot air and rhetoric, and then have a debate that’s substantive. That was that whole part of that housing effort. It took a couple folks on both extremes to try to screw it up at the last minute, but you know to Matt (Gonzalez’) credit and Chris (Daly’s) credit they came back together. And so that’s what it’s all about. I thought it was a very positive process. Is it exactly what I wanted? No, but you know, hey we were at $185 (million) and 100 percent of AMI, now we’re at $200 (million) and 90 percent of AMI. We’re all there. We’ve got our supportive housing piece. Critical. We got our affordable housing. Critical. We’ve got a little home ownership. I think that’s important. I believe in assets. You’re going to see a lot more, and this may upset some folks, but I believe in individual development accounts. That’s why I support local earned income tax credits. I want to advance asset creation in communities that have been traditionally underserved so we can remove this cycle of poverty.
SB: I wanted to ask you about the Ratcliffs opposition over the (proposed) MUNI facilities maintenance yard. They are hoping the project will have a job training program.
GN: Yeah, I’m all for job training programs
SB: Would you meet with them? I know they didn’t support you, but --
GN: Well, he’s particularly offensive in some of his comments. He and some of his writers are just, wow. Just angry folks. I’m sorry they’re so angry. I’ve seen Willie five times. They’re trying to get Sophie (Maxwell). They’re just angry. I understand their anger. I understand the frustration out there. But I think I’m on their side in most cases, because I care about the community. And they care about the community. I want to make a difference. They want to make a difference. If they would just stop maligning every motivation for every action.
SB: I can’t imagine you not being in favor of job training.
GN: It’s just that they’ve been calling me racist and everything else. So it’s hard to read that one nugget that may make sense. There are certain times you don’t even read it (shudders). I try to read the other side, but sometimes it’s such vitriol and spit and vinegar and you realize that there’s nothing here except anger. That’s releasing some good vibes, I guess.