“In the end, most of the city’s economic problems come back to one thing: government. New York has become a painfully difficult place to do business. For instance, Borders, a bookstore chain that lost an outlet at the World Trade Centre, recently opened on Wall Street to acclaim from every politician in the city. It had taken the store six months and the hiring of specially licensed architects, lawyers and ‘expeditors’ to get its sign approved, a process that elsewhere takes a day. That is New York’s burden on business, writ small.”

— The Economist, September 11, 2003

“We are not going to walk away from protecting the public just to make it easier to go and open a store. There’s a balance and we’re going to achieve that balance. We’re going to make sure that companies come here.… Let me also point out to you that the store that has a problem in opening here can’t open anyplace else because the market that they need is right here. This is the Big Apple, and this is where you can sell goods and services for people that appreciate quality and are willing to pay for it.”

— Mayor Bloomberg, September 16,2003

The contrast couldn’t be more painful between the words of The Economist, explaining in a recent article New York City’s morass, and the words of Mayor Bloomberg, at Battery Park yesterday. If this isn’t Mr. Bloomberg’s “Because We’re New York” philosophy — which he uses to explain why businesses will stay in New York despite increasing taxes and regulation — writ large, we don’t know what is. Apparently the mayor still hasn’t read the report released earlier this month by the Center for an Urban Future, “Engine Failure,” in which Jonathan Bowles and Joel Kotkin warn: “The city now faces profound structural economic challenges that no amount of ‘Capital of the World’ bravado can obscure.”

“The mayor’s reply seems to sum up his philosophy of economic development in a nutshell. It doesn’t seem to occur to him that the ‘market’ is competitive for cities as well as for companies,” the Manhattan Institute’s fiscal policy expert, E.J. McMahon, told The New York Sun last night.”There are actually quite a few places outside New York City where lots of people who appreciate quality are quite happy to live, and where Borders can sell plenty of books.”The mayor also seems to forget, according to Mr. McMahon, that “a big chain bookstore is one of the best tools ever devised for sucking up sales taxes from people with disposable incomes, and so perhaps you shouldn’t be so cavalier about the obstacles your city government may be placing in their way.”

The mayor has also been cavalier on the point that major companies and industries will stay anchored in New York City, no matter how unfriendly the port. But, Mr. Kotkin pointed out recently, “manufacturing jobs dropped 3.2% nationwide during the 1990s, but more than 33% in New York.” Financial services? “Nearly 97% of all the nation’s growth in the securities industry since 1990 has taken place outside the city,”Mr. Kotkin writes. Big companies? “The number of Fortune 500 firms in New York was down to 39 in 2002, from 42 in 1999, 77 in 1979 and 140 in 1955,”Mr. Kotkin writes. Retail stores like Borders? “Locating in New York was once critical for major retailers. Today, not one of the nation’s top 20 retail firms is headquartered there,” according to Mr. Kotkin.

We comprehend that the opening of one bookstore is small potatoes to a tycoon like Mr. Bloomberg, but, as The Economist said, this is our problem “writ small.” New York will not always hold its place in the world by default, and placing barriers to businesses big and small is the last thing this city should be doing as it struggles to recover from September 11 and to keep up with the rest of the country. For City Hall to assume that people are willing to pay for it is imprudent.