NEW YORK CITY—In an Election Day talk on how the Presidential campaign became so divisive, and what will move the nation forward, former New York State Governor Eliot Spitzer explained where the vitriol came from and what needs to change. However, the real estate scion—now the head of his late father's firm, Spitzer Enterprises—also spoke at the Young Men's/Women's Real Estate Association monthly luncheon of what's needed to boost the city.

“We still have a structural shortage of residential space, which means we need to build housing,” Spitzer declared. “We can't survive without that and—if it's too expensive—people will go elsewhere.”

However, he asserted, “421a doesn't work. Yes my family took advantage of the program but if you look at the cost and the number of units we're getting from it today, that doesn't give us what we need.”

Spitzer explained, “In the current incarnation of 421a, it costs about $375,000 to get one unit built. That's not a good use of public money.”

Instead, he proposed focusing on transportation and upzoning. “The way to build new housing is to build up transportation lines to be accessible to the CBD so that private capital comes, and then upzone to make it meaningful. That would work long- term.”

He admitted that upzoning isn't easy to execute. “No one wants it, but we need political will.” Meanwhile, the political climate nationally has become so heated, Spitzer noted, but offered up reasons why the race for President boiled over with viciousness.

“This has been the ugliest campaign I can recall,” he observed. “There's been a clear lack of civility and substantive discourse. Politics is nastier than business because the former is a zero sum game; if you lose, you're out. If you're a broker and you lose one deal today, there's another one tomorrow.

In addition, he said, voters' frustrations hit a fever pitch largely because of several economic conditions. “Median family income has been flat since the 70s. That wears society down.

“At the same time,” he continued, “enormous wealth has been created in the last 30 to 40 years. We all learned there was a critical relationship between growth of productivity and wages.”

Generally, Spitzer shared, “When productivity goes up, we all do better. In the mid-1970s, productivity grew but wage growth went flat. Losses have been concentrated among white male workers who've seen their wages flat line, or disappear all together.”

These shifts happened when manufacturing largely became automated, Spitzer revealed, slashing jobs at assembly lines and in other similar entities. But, he cautioned, “You can't stand foolishly against the tidal wave of what's going on. We have to educate and train people to become part of the new economy.”

Spitzer expects the tone of the national discourse to change too—or at least, he's hopeful. “I don't think (this type of campaign) will be the new normal; politics runs in cycles. If campaigns are about divergence, governing is about creating common ground. I hope that's where we go.”

Spitzer explained, “In the current incarnation of 421a, it costs about $375,000 to get one unit built. That's not a good use of public money.”

In addition, he said, voters' frustrations hit a fever pitch largely because of several economic conditions. “Median family income has been flat since the 70s. That wears society down.

“At the same time,” he continued, “enormous wealth has been created in the last 30 to 40 years. We all learned there was a critical relationship between growth of productivity and wages.”

Instant Insights /

Eliot Spitzer: “421a Doesn't Work”

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