Eric Garcetti Faces Major Challenges as Next Mayor of Los Angeles

How will Eric Garcetti lead a city that's been stuck in the economic doldrums and suffered through four years of budget deficits?
by | May 22, 2013

Los Angeles City Councilman Eric Garcetti has been elected mayor of the nation's second largest city, defeating city controller Wendy Greuel after a campaign that lasted nearly two years. He is the city's first elected Jewish mayor and, at 42, will be one of the youngest in more than a century.

Garcetti, who won with 54 percent of the vote, faced fellow Democrat Greuel after the two took the top slots in a crowded March primary. The mayoral election cost more than $33 million, making it the most expensive in the city's history. Despite the big sums spent, only 19 percent of L.A.'s registered voters cast a ballot on Tuesday, according to the Los Angeles City Clerk's office, making it one of the lowest turnouts on record for a mayoral election.

Part of the reason the turnout was so low may have to do with lack of excitement about the campaign. There was no message of hope or call for change, wrote Robert Greene of the Los Angeles Times. "We know no more today than we did six months ago how close city government is to insolvency, whether City Hall is providing the right services, whether the public workforce is the right size to give residents what they demand."

A three-term councilman, Garcetti was heavily involved in balancing the city's budget, which ran a deficit totaling $1.6 billion over the past four fiscal years. He pushed for service cuts, workforce reductions and changes to the city's retirement system. The city has planned a $7.7 billion budget for 2014. During the campaign, Garcetti said he would consider seeking more concessions from the unions.

For decades, Los Angeles has been an engine of growth for California and the country. But lately, the economy has taken a hit, with the manufacturing sector in a major slump, losing 55 percent of its jobs over 20 years. But the economy is finally stirring, and the city's revenues are expected to increase by $400 million in the next four years, according to Los Angeles's Chief Administrative Officer Miguel Santana.

As Steven Malanga, a senior fellow at the Manhattan Institute points out, employee costs are exploding. In the past 10 years, pension costs have gone from three percent of the city's budget to 18 percent. With Garcetti's involvement, the city has raised the retirement age for new civilian workers from 55 to 65 and increased the amount employees pay towards pensions and health care. But those changes won't really start to show up in the budget for years to come.

Without more growth in the city's revenue or deeper cost cuts to a workforce that's heavily unionized, Garcetti will have limited room to maneuver and make his mark when he begins his term in office. It's a situation a lot of mayors find themselves in as their cities continue to struggle with fiscal distress. No doubt, Garcetti will be closely watched to see whether his years as a councilman and work to balance the budget pay off.


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