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Brian Lehrer: Brian Lehrer on WNYC. Now we continue our month of may round of interviews with the New York City Democratic primary candidates for mayor. Our theme for this round is economic recovery meets economic justice. We know that any new mayor will have to guide the comeback from COVID after so many hundreds and thousands of jobs were lost. We also know the economic devastation was not spread evenly across the board in the city. We know that fighting economic inequality was how Mayor de Blasio got elected eight years ago and yet that work already had many miles to go even before the pandemic. Economic recovery meets economic justice. We'll also touch on a few campaign news items.

With us today on this candidate Dianne Morales. Before we say hello to her, I want to give you a little fuller description of her professional background than you usually hear in the press, which is usually just former non-profit executive. Since many of you are still becoming familiar with Dianne Morales, the News site Gotham Gazette describes her background like this in some more detail that I will read here from Gotham Gazette.

After noting that she grew up in Bed-Stuy, was raised in a union household and public housing, went to Stuyvesant High School, and earned graduate degrees from Columbia and Harvard, it says a former educator working in the public school system, Morales has spent the last 20 years working in the nonprofit sphere around education and human services for the city's most vulnerable.

Between 2000 and 2002, she served as executive director of East Harlem Block Schools before joining the department of education in Mayor Michael Bloomberg's administration. She served as chief of operations of the newly created office of youth development and school community services until 2004. She then spent one year as director of state implementation and operations at the teaching commission. For the next four years, between 2005 and 2009, she was executive director at The Door, a youth development organization that serves at risk young people including those involved in the court system and homeless and foster care youth.

Then, after a one-year stint, as vice-president of programs at Single Stop USA, she became executive director and CEO at Phipps Neighborhoods, a Bronx-based antipoverty organization that provides education and workforce training services for low-income New Yorkers. After a decade at that job, she left and threw her hat into the mayoral race. All of that from Gotham Gazette and with that as fuller than usual prelude, Ms. Morales, thanks for coming on. Again welcome back to WNYC.

Dianne Morales: Good morning, Brian. Thanks so much for having me back. It's a pleasure to be here.

Brian: Did they get your bio right?

Dianne: They sure did in painstaking detail. Good for them.

Brian: To the theme of our main topic this month, how does your own personal story  

impact your approach to economic justice in this very unequal city?

Dianne: I think that one of the things that I recognize is that the folks who actually do the work of running our city and taking care of New Yorkers are very often the ones who are most frequently left behind, they're the ones who are most financially insecure, the most unstable and the most unprotected. I think that if there's anything that we should be taking out of our lived experiences from the pandemic in 2020, in particular, it's that those people actually kept our city running while the rest of us were able to comfortably work from home and there is an inextricable link between us all and between our collective wellbeing.

I'd like to see a new economy for the people moving forward that actually provides those folks with the resources that they need to live in dignity. That is what my plan specifically speaks to. That's what I think would be just from an economic recovery perspective.

Brian: Is it possible to say what would have been at the heart of your economic justice platform before COVID and how much the emphasis has had to change to meet the change conditions that the pandemic has forced upon us especially with so many jobs lost?

Dianne: I think if anything, what has really changed is the emphasis and the extent to which the inequities and the disparities have been exacerbated and the extent to which it's, I think, become all the more highlighted that we actually have these deep inequities and that we should from a moral and, I think, a politically just perspective prioritize and center those folks moving forward so that we can all benefit because the reality of it is that if they benefit, we benefit because we've seen that they've taken care of the rest of us.

I think it really just put in sharp focus-- Into sharp focus the things that I was already talking about. Unfortunately, it did that at the sake of those who are the most vulnerable because they've actually been moved into even more precarious economic positions as a result of the pandemic. I think it has made it something that is also more commonly being discussed right now than it might have been a year and a half ago.

Brian: As mayor you would do what to start to address these inequalities? I realize there were so many different planks in the platform in so many different areas, housing, education, employment law, everything, but pick one or two of your policies that you'd like to highlight to an audience that might still just be starting to get to know all of you.

Dianne: Sure. I think one of the things that's really important to recognize is that the way we structured our economy has been in such a way that prioritizes and incentivizes and focuses largely on large businesses and corporations, whether we're talking about the tax subsidies or incentives or grants that we're providing. It really prioritizes the people at the top.

I think there a way for us to think about building a new economy that redirects all of

the aid, what I've been referring to actually as corporate welfare, redirects those resources in such a way that we are investing in and prioritizing our small and mid-sized businesses and really making sure that they are getting the support and the resources that they need because the reality of it is that we know that they actually employ 50% of the New York City workforce. There's a lot of value to thinking about reframing how we approach the economy in a way that prioritizes them instead of large scale businesses or corporations that essentially come into our communities, explore our labor and extract our wealth.

Brian: How, for example?

Dianne: I have proposed for actually creating an expanding support to small and mid-sized businesses, really creating a robust program that will prioritize getting them the dollars that they need, the training and the technical assistance that they need, that streamlines the bureaucracy that they have to interact with and overcome in order to operate. I've also called for the creation of a public bank that makes it much more possible and much more accessible to, first of all, that moves away from commercial banking and in terms of how we're using New York City dollars, and that makes low and no-cost loans available to our businesses that makes banking available to our communities that we know are--

We've got a such a significant percentage of New Yorkers that are currently unbanked and that really leverages our public dollars to create credit that serves the public including providing those reasonable and fair loans to the small sized businesses. Also, beginning to provide an economic foothold to our low-income Black and brown communities. We know that 16% of Black households were actually unbanked as of 2017. Providing some economic stability to those that have been impacted the most is a different way of thinking about how we can orient our economy moving forward.

Brian: How would you do the bank thing? Senator Gillibrand comes on the show and she likes to talk about her idea for post office banking. Is yours that or something else?

Dianne: I certainly think that that could be a valuable distribution mechanism, I think. We've got we've got to get this passed. I know that the state was looking at this. I really think that given the budget of New York City, we should be using that money and investing that money and utilizing that money to leverage security, economic security, and resources for our own communities. Currently, those dollars sit in commercial banks.

We know that those commercial banks charge exorbitant interest rates and fees to our most vulnerable communities which in turn results in the higher levels of unbanked new Yorkers. We really need to look towards creating an equitable recovery that centers those folks in their ability to access services. That's one of the things that I think would be critical moving forward

Brian: Listeners, we welcome your phone calls, your questions primarily about

economic recovery meets economic justice in New York City for Democratic mayoral primary candidate Dianne Morales 646-435-7280, 646-435-7280 or you can tweet a question @BrianLehrer. Ms. Morales, you said a minute ago, you mentioned something about the government giving some assistance to small and medium-size businesses.

I was a little surprised when this came up in the debate last Thursday night. I had asked the question of all of you, you'll remember, what would you do to help small businesses recover from the economy? I believe just you and Maya Wiley mentioned specifically what sounded like putting taxpayer money into private businesses. You said that again a few minutes ago. Under what circumstances does it make sense for the public to actually subsidize a private business that's out there to make money for itself?

Dianne: Our small businesses? Well, I think first of all, we know that they employ 50% of New Yorkers. We know also that small business owners tend to actually live in the community and tend to in turn reinvest in the community. If we're talking about building a new and different economy, the vision that I have for this is one where we build back from the ground up and from the center out really transforming the model of New York City's economy. That also includes the idea of investing in things like worker-owned cooperatives that also democratize businesses and democratize how wealth "is distributed in the community".

The idea is really primarily to move away from, as I referenced at the top, this corporate welfare model where we are really providing taxpayer dollars to large corporations in exchange for a really, really small return. This actually, I think, dramatically increases the return on our investment in a local way that strengthens folks on the ground, both their individual access to economic security and stability and begins to build by folks reinvesting locally in the community begins to strengthen the communities at large.

Interviewee: Erin in Windsor Terrace, you're on WNYC with Dianne Morales. Hi, Erin.

Erin: Hi, Brian. Hi, Ms. Morales.

Dianne: Hi, Erin.

Erin: Hi, I had a question about rent for the middle-class. Even before the pandemic, most of us were paying 30% of our income to live in roughly a 700 square foot space. It's untenable at this point. We saw a lot of people leave and I guess landlords lowered the rent maybe $200 or $400. Is there a plan not for people being evicted or homeless, but for the middle and poor working class to have housing that we can finally afford?

Dianne: Yes. I think that's a really, really great question. I think we need to really put some regulations in place so that we are managing both landlord's ability to arbitrarily increase rent. My personal position on this has been that no one should have to pay more than 30% of their income on rent, especially those New Yorkers

who are struggling. I think the wealthy can make different choices, but working-class and struggling New Yorkers should not have to pay more than 30% of their rent.

I think that means us really reorienting how housing operates including providing protections for existing tenants, but also moving forward reorienting how we do housing and what the housing market looks like. Whereas right now we've really prioritized and centered luxury developers and gave them a tremendous amount of tax breaks and subsidies to, in fact, generate units that are largely unaffordable and inaccessible to the majority of New Yorkers.

Those are choices that we make as a society and we can actually make different choices that moves away from incentivizing those folks and actually prioritizes regular New Yorkers who are simply trying to live in dignity and operate here in the city and may not be our top 1% earners. I think there's a lot that we need to right-size in so far as housing is concerned as well.

Brian: Funny enough, Erin calls from Windsor Terrace. One of my colleagues who lives in Windsor Terrace just shared an article from the Wall Street Journal that just got published about the neighborhood and housing prices. It says, "In Windsor Terrace, asking rents rose 10% to 2,750 a month and that's during the pandemic. The median sales price rose 62% to $1.1 million partially stemming from the purchases of larger homes in the neighborhood," says StreetEasy Economist Nancy Wu in the Wall Street Journal. That's Windsor Terrace specific measurement.

What you just said, Ms. Morales, would that 30% cap on how much of your income you should need to spend on rent apply to all the apartments in New York City that are currently now not in the rent regulation system?

Dianne: Well, I certainly think that we need to move towards making sure that we're prioritizing and protecting our tenants. Whether that is determining where that cutoff is and how it is that our more wealthy or our more well-resourced neighbors navigate the system, I do think that we need to prioritize protecting renters. The statistics that you just quoted from Windsor Terrace [chuckles] are appalling, particularly in the light of a pandemic.

They actually go counter to the narrative of some of the economic challenges. If prices are increasing dramatically in the middle of a pandemic, that speaks to a different level of inequity that we are failing to address. My proposals are basically based on the idea of this also being a crossroads for us and an opportunity for us to reflect on all of these systems that deepen the inequities and making the commitment to addressing them by transforming these systems.

Brian: Mike in Harlem, you're on WYNC with Dianne Morales. Hi, Mike.

Mike: Hey, how are you doing? Keeping it with the theme of trying to increase the wealth of New Yorkers, I've lived in public housing, the projects in Harlem all my life. Many people have lived with 20, 30, 40 years. At the end of that, investment in public housing that they've made, they just owe another month's rent. I'm thinking perhaps public housing can be restructured so that there is a rent-to-equity program where

part of the rent that they pay goes into equity in the public corporation that can grow over time so that after 20, 30 years of living in public housing, they have equity in the system and they are owners and shareholders.

In line with that, many countries like Singapore and Norway have Sovereign Wealth Funds based upon the economic might of those particular localities. New York City should have a Sovereign Wealth Fund. We are in an era right now where people just make up imaginary coins like Dodge Coin and the rest and billions of dollars are generated, but we have people who have invested, worked, lived in this city all their lives, grandparents as well, and they come out at the bottom all the time.

We need to think creatively about the wealth that New York City has, and not necessarily having to give money, but give equity to people who will then be more invested in New York City to make it better and that includes public housing.

Dianne: I love what you're saying. I agree largely. Part of my proposal specifically around public housing in NYCHA is to move towards democratizing NYCHA. I think it's really important to give residents a lot more power, a lot more control, and a lot more say over what is happening in NYCHA, but not divesting. We have to do that at the same time that we also continue to invest and increase our investment in NYCHA because it's not enough to say, "Here this is yours," and hand over a dilapidated property that is mold infested and has leaky roofs.

I think we have to do-- It's a both/and. I've also called for one of the things I think we should be looking at, at least initially is piloting a residential management company in one development in each borough, where we begin to move towards that model of giving NYCHA residents control. I also think that has to be coupled with a massive investment in NYCHA.

The Green New Deal for Public Housing is something that I'm 100% supportive of. I've committed to investing a minimum $1.5 million in my first year and making sure that we're getting the match from the state on that, as well as taking on the federal government. Sorry. I said 1.5 million, 1.5 billion with a B. I think what you're suggesting is exactly the thinking that we should be taking on as we move forward and as we think about how it is that we empower our residents in the city.

Brian: Thanks for the call Mike. Keep calling us. Ms. Morales I have to ask a couple of things about you about them that are in the news. Your last last position before leaving to run for mayor was CEO of Phipps Neighborhoods. Politico New York has a story that says, "Morales distances herself from former employer amid pressure from housing groups."

This was from late April. It says, "Phipps Neighborhoods where Morales spent roughly the last 10 years as CEO is the social services arm of Phipps Houses, one of the city's largest affordable housing developers, the development side of the nonprofit makes regular appearances on an annual Worst Evictor's lists put out by tenants groups.

It's come under fire from activists and politicians over poor conditions in its buildings

and its classed with unions over its labor practices. Did you know about all of that when you were CEO of Phipps Neighborhoods?

Ms. Morales: Not entirely, although to be honest, I think that the concerns are valid and legitimate. Phipps Neighborhoods is a commercial tenant in several of Phipps Houses buildings and I think shared some of the same challenges.

I addressed those challenges with Phipps Houses management, but was really focused quite frankly on the work that I was doing in terms of providing services to community members and really focused on creating access to educational and career opportunities for people that could be transformative in terms of their lifelong ability to live in dignity. I don't dispute the concerns that are being raised and I shared some of those over the course of my tenure there.

Brian: Does this story mean that nonprofit affordable housing developers aren't necessarily more ethical than for-profit developers. I guess the question for you as a potential mayor is when you have to decide on zoning allowances to build high or other things that developers wants from the city, is there no reason to assume that a non-profit developer of affordable housing is going to be more ethical?

Ms. Morales: I've said publicly that I don't think all nonprofit affordable housing developers are created equally. I wouldn't want to throw the baby out with the bath water. I think it would be it's important to have a close eye and real clarity around what the work is that they're doing, the quality of the work and also what they're getting in return in terms of the dollars.

Again, I think the tax subsidies and those kinds of things and how that is happening. The mechanisms that we're using are really important. I don't think that they have necessarily been wielded in the most beneficial way to the communities on the ground that need it the most.

Brian: As you know, but many of our listeners may not the news organization, The City reported this week that you "participated in a $300 bribe of a city department of environmental protection inspector who offered to make her $12,500 water bill go away." City investigative records obtained by The City show.

It goes on to reveal that the department of education where you're working at the time special commissioner of investigation, which conducted the review recommended in a letter to the school's chancellor summarizing the findings of the probe "that Morales his employment with the DOE be terminated." You left the job voluntarily a short time after that. How should the public understand this according to you?

Ms. Morales: Well, thanks actually for the opportunity to clear the air on this. This was admittedly a difficult time in my life. We're talking about 2002. I was a single mom and a first time homeowner going through a contentious divorce. The reality of it is that shortly after I had moved into my home, I received a water bill that was artificially inflated for over $12,000.

I did what I think most new Yorkers would do, which was to call the city for help, the help that I thought city agencies are supposed to provide, but instead what happened was that they sent someone who was, in fact, under investigation for corruption. Unfortunately, at the time, like a lot of other new Yorkers, it didn't occur to me that I could challenge this city official or attempt to even go over his head.

Actually, as a matter of fact when I called to schedule that inspection, I was told very explicitly that his determination and his findings would be final and binding. I did what he told me that I had to do at the time. When the story broke the other day, I thought it was really important to share my side of it. Upon doing that, it became really clear that so many others in the city have actually had similar experiences.

I got overwhelming support after telling my side of the story and we ended up actually having the best fundraising day in the history of this campaign, but I don't think that's what really matters. What I think really matters is that this turns out to be an all too common experience and that our government needs to do better to serve our most vulnerable. That's what I'm committing to doing as mayor. That's why I think so many folks really responded and that story seemed resonate with so many new Yorkers.

Brian: Did you feel officially or unofficially extorted in any way? The government inspector was like, "Okay, you give me something and I'll make this exorbitant water bill go away"?

Ms. Morales: It definitely didn't feel right, but I honestly would whether naively or not didn't feel like I had any other alternative. I had already reached out to the city to ask for help and this was what was being provided.

Brian: Santi in lower Manhattan, you're on WNYC with Dianne Morales.

Santi: Is that me?

Brian: That's you.

Santi: Thank you, Brian. Thank you, Dianne. You're my candidate.

Ms. Morales: Thank you.

Santi: [crosstalk] it's a little bias. In fact, I would like you to-- If Brian will let you tell me how I can volunteer for your campaign. I have to tell you also that, unfortunately, the reason I want to do this is the same reason that I thought Mayor de Blasio was a good candidate. That is he was the least worst of all and that's the best I can say over you.

You have my sympathy for the story that I just heard for the first time. Hopeful as a community activist, I would have gone for the crusading, but I understand that most people realize don't have this option and they have a lot of other problems to to deal with, so you got my pass on that, but I wanted to ask you two questions.

One was about the corporate welfare. Are you aware of these mega national

corporations that pose in the community as specialty restaurants, but they own dozens of them. They gross hundreds of millions nationwide and I wouldn't be very weary of the noncorporate welfare going to them instead of real bonafide operators.

Brian: Santi for time, forgive me, what's your second question. Let's get right to it.

Santi: The second question was about the housing. The thing that I heard rose my suspicion a little bit because as the NoHo Soho rezoning plan, a trojan horse has been used in terms of affordable housing. I know that my club, the Democratic club, the DID endorsed you, so that's a good credential, but I want to hear from you, how will you make sure that affordable housing is not used by mega developers who want to build towers in Soho, but not just the Soho, the land grab is going on citywide.

Brian: Santi, I'm going to make that the last word. Please call us again. I know you've got to go in about 90 seconds Ms. Morales. Use that question to say anything you want to say to wrap it up.

Ms. Morales: Sure. I actually believe that we need to fundamentally overhaul the way we do the land use process and how these decisions are made. I believe in the zoning of areas that have been historically under utilized, let's say, on the affordable housing front. That being said, I think the process needs to be one that centers and prioritizes community within the context of the city at large, so that we are making sure that we're aware of the city-wide distribution and allocation of resources, of services, of housing, and those kinds of things. It doesn't seem to me like the Soho NoHo project actually adhere to that.

I think that we would need to revisit that, specific to that project. It doesn't sound to me like I'm saying anything different than Santi did, but I do think it's important to prioritize communities with the lens of the city-wide balance and equity.

Brian: There we leave it for today with Democratic primary candidate for mayor, Dianne Morales in our May round of interviews on economic recovery from COVID meets economic justice. Our next one in this set will be with candidate Shawn Donovan on Monday.

Ms. Morales, we always appreciate your time. You've been on with us three times now during the campaign, we appreciate that you come on and take listeners' questions and mine. Thank you, thank you, thank you.

Ms. Morales: Thank you so much for having me, Brian, it's been a pleasure. Have a great day.

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