“The people must have confidence in the integrity of the Justices, and that cannot exist in a system that assumes them to be corruptible by the slightest friendship or favor, and in an atmosphere where the press will be eager to find foot-faults.”

— Memorandum of Justice Scalia, explaining his refusal to recuse himself in a 2004 case involving Vice President Cheney

In his dealings with the City’s Conflicts of Interest Board after winning election as mayor, Michael Bloomberg agreed to recuse himself from all dealings with Merrill Lynch because of its 20% ownership interest in Bloomberg L.P., the financial information company that is the basis of the mayor’s fortune. Now Merrill has announced its plans to sell that stake — either to a high bidder or to Bloomberg itself — i.e., the mayor, who has a right of first refusal. The announcement of the sale comes as Merrill is quite publicly mulling a move to a new skyscraper at ground zero, a move that presumably would come with a plea for city and state tax incentives on the order of the estimated $650 million granted to Goldman Sachs for its new headquarters.

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It all puts Mr. Bloomberg in an awkward spot, but ducking his responsibilities as mayor with what the Conflicts board characterized in its 2002 opinion as a “broad recusal” is the wrong way out of it. The voters had a chance to judge Mr. Bloomberg’s integrity when they elected him, twice, knowing full well of Merrill’s stake in Bloomberg. They elected Mr. Bloomberg for his connections in the financial world and his business acumen, not despite of them. The idea that Mr. Bloomberg would subordinate the city’s interests so as to advance his own personal financial interest is preposterous to anyone who knows the mayor even slightly. Given the optics, he’d likely bend over backward not to give even the appearance of favoring Merrill.

What the city needs now in terms of tax policy is not reductions handed out to powerful special pleaders in exchange for real estate deals, but across the board cuts on marginal income for individuals, including the many individuals whose business income flows through to their personal income tax filings. What the taxpayers need is a mayor who will stand firm in negotiating with Merrill on their behalf, not one who is going to duck behind imaginary ethics issues as a basis for a recusal, with the effect of leaving the negotiations to less shrewd negotiators.

Were Bloomberg L.P. negotiating for a new headquarters with the city that would be one thing, but this is not Bloomberg L.P. but a minority shareholder in Bloomberg that has announced its intention to sell its shares. The Conflicts of Interest Board is but a panel whose members are appointed by the mayor; they, in our view, have more of a conflict in this than the mayor does. The mayor outranks it. The way for him to proceed in dealing with Merrill is as Justice Scalia suggested, one that assumes public confidence in the mayor’s integrity rather than bowing to an approach that focuses on foot faults when none have even been committed.