Part 1 of 2
Thirteen: A Season of Compromise: Preparing for 1993
DEFEAT WAS A STRANGER IN RUDY GIULIANI'S LIFE. FROM
Manhattan College, NYU and MacMahon to foley Square, Patterson
and Justice, he had rarely suffered a setback. He'd been embarrassed a bit by
Haiti, McDonnell Douglas, Myerson, Wigton and Tabor. But each had barely
provoked momentary reflection. The 1989 election, however, yanked him to a
halt, altered his career calendar and tested his gut.
Losing a terribly public slugfest-even by a margin he'd managed to miraculously
narrow-also left him, for the first time since he became associate attorney
general in 1981, just an ordinary man, albeit one still brimming with
extraordinary ambition. He was again, as he had been almost a decade earlier,
merely one of 62,000 lawyers in a city of clamoring courthouses. His return,
in his discount suits, to an obscure private practice made him more certain
than ever that it was not enough for him.
He went back to White & Case after the election, but lasted less than six
months, rarely appearing at his office but still drawing hundreds of thousands
in income. In January 1990, he bought a third apartment at 444 East 86th,
moving Helen downstairs to the 18th floor. Settling in for the most domestic
period of his and Donna's life, they knocked down the wall between their two
units on the 35th floor and turned the renovated apartment into a reasonably
spacious home for four. Rudy owned Helen's apartment alone, beginning a
separation in his and Donna's finances that would widen over the years. He
listed the apartment on his 1993 financial disclosure form, filed with the city,
as valued at between $100,000 and $250,000, putting his Citicorp mortgage in
the same range.
By May 1990, he left W&C for Anderson Kill Olick & Oshinsky, a twentytwo-
year-old upstart of a litigation-heavy firm that specialized in defending
asbestos companies. Once again, as he had with W&C, he convinced Anderson
Kill to take on his sidekick Denny Young as a full partner. John Gross, the for-
mer AUSA whose apartment Rudy had retreated to when he and Regina first separated
in 1974, was Giuliani's champion at the firm, convincing his partners that
Rudy was the right fit.
The firm's records indicate that Rudy brought only a couple of clients with him
and that, over the course of the next three years, added few to its list. His biggest
new client was AT&T, which hired him to defend the company against a racketeering
lawsuit brought by a Venezuelan communications company.
Drawing on his extensive RICO experience in the SDNY, he bottled the case up
on technical motions, preventing a trial on the issue of whether AT&T had driven
the Venezuelan firm "from the marketplace, misappropriating its technology and
proprietary business information." His opponent, Myles Tralins, a Miami attorney,
said Giuliani's "briefs and arguments were superbly prepared" and that
"avoiding a trial was a significant service to his client." An entry in Anderson's
client list also indicates that AT&T retained Giuliani in March 1992 with regards
to "legislation," though the entry doesn't indicate whether the bill it was interested
in was under consideration at a federal, state or city level.
Another Giuliani client was Towers Financial, a collection company controlled
by Steve Hoffenberg, who'd been accused by the Securities and Exchange
Commission of selling $34 million in unregistered securities in the 1980s and had
reached a civil settlement with the SEC. With ten separate entries for Towers matters
in the firm's client list, Hoffenberg was a major, Giuliani-generated, addition.
He also became an extraordinary headache.
An Anderson lawyer was sanctioned by a federal judge for filing a frivolous
lawsuit on behalf of Towers against Wang Laboratories and Giuliani had to personally
sign the settlement agreement. Worse yet, when Hoffenberg faced indictment
on a $460 million fraud charge in 1994, he offered to cooperate against an
Anderson attorney, who he charged had told him to lie under oath to federal prosecutors.
The false charge took a year and a half to disprove.
Hoffenberg was hardly Mr. Clean when Giuliani brought him to the firm.
Convicted as far back as 1971 of larceny, he also used a lawyer to register Towers
for public trading who was convicted of tax fraud. Yet Rudy had not only opened
the door for him at Anderson, he'd collected thousands in contributions from
Hoffenberg entities.
The SEC filed new scam charges against him in Giuliani's final weeks at the
firm. Ultimately, a federal judge sentenced Hoffenberg to twenty years in prison,
saying he'd destroyed "the savings and investments of thousands of people" and
blasting Towers as a pyramid scheme.
While Hoffenberg was a corporate client who proved to be a criminal, Rudy did
apparently do criminal law work for other clients. The firm's list says he represented
one client involved in an "FBI investigation" and another in a "grand jury investigation."
But surprisingly, with all the hoopla about his purported trial skills, he
never tried a civil or criminal case at Anderson or W&C. His only known trials as a
private attorney occurred way back at Patterson, and involved two libel matters.
In Giuliani's first full year at Anderson-1991-he made $578,000 in salary and
bonuses. That dropped to $294,000 in 1992, when his honeymoon at the firm began
to wear so thin some partners started openly griping about him. Ann Kramer
wrote a January 6, 1993 memo to another partner including Giuliani and Young
on a list of "attorneys who should be asked to leave."
A January 20 memo from Bob Horkovich, reviewing "the 1992 hours that each
attorney devoted to billable, pro bono" and other matters, ranked Giuliani and
Young lowest. It noted that Rudy was 1,740 hours under budget and Young 1,456.
An accompanying chart revealed that Giuliani had only billed for three hours in
the entire month of December, and a scant 177 hours that year, without a second
of recorded pro bono time. At $375 an hour, he was budgeted to generate over a
half million dollars, but instead came in dead last in the firm's workload scorecard.
Three days after the Horkovich memo, John Doyle, one of Giuliani's former
Southern District friends at the firm, reported at a meeting of its board of directors
that Giuliani and Young had reached an "agreement" with Anderson Kill "regarding
a departure date and leave of absence." March 31 was selected as the date
both would leave. While the firm's managing partners later claimed that they were
fully satisfied with Giuliani's performance, Eugene Anderson, the lead partner,
wrote a memo in the middle of the January 1993 skirmish acknowledging that
"the present distribution" of firm profits "overcompensates for 'political clout'."
By the time Rudy left Anderson, he'd been a private attorney at three firms, including
Patterson, for a combined eight years, all quite undistinguished. It was not
a question of ability; it was a question of focus. He'd proven, as both a young
AUSA and as U.S. Attorney, what a sharp legal 1 :ind he had. The work just didn't
turn him on. He said when he came to Anderson that he wanted to resume the
First Amendment practice he'd specialized in at Patterson and that he wanted to do
securities regulation compliance for foreign and U.S. companies. He left without
doing either.
Instead, Giuliani used the office as a campaign headquarters. He involved other
partners in the campaign, naming Gross his treasurer. When he put together a
skeletal staff, they worked out of a conference room at Anderson Kill through most
of 1992. From the moment he arrived at the firm, he was a mayor-in-exile, and he
spent more time plotting a democratic coup than collecting lucrative clients.
He flirted with a 1992 race against D'Amato, teasing reporters and his nemesis
now and then with public winks, but his eye was fixed on the vulnerable opponent
who'd barely beaten him. He became a magnet for anyone disaffected by anything
David Dinkins did, a political paramedic parked at City Hall to respond to a four-year
state of emergency, diagnosing the wounded and comforting the aggrieved. On the
electoral rebound himself, he positioned himself to rebound every missed Dinkins
shot. To win the inevitable second race, he would spare no effort or personal value.
The mistakes of 1989 convinced Rudy that he would have to step outside his reflecting
pool of confidants for policy and political advice. He recognized his own
need for municipal remedial education, so he designed an informal course on city
governance. He reached out to Ray Horton, the finance guru at the businessfunded
Citizens Budget Commission, Henry Stern, the ex-Parks Commissioner
who ran the city's leading good-government organization, and Robert Wagner Jr.,
the Koch deputy mayor raised in Gracie Mansion during his father's three terms.
He met with Rodger McFarlane, the gay activist and ally of Larry Kramer's, homeless
honcho Andrew Cuomo and teachers' union president Sandra Feldman, whose
election-day field operation had been so key to Dinkins's 1989 win.
Later on, he even secretly met with William Bratton, the future police commissioner
who was then head of the Boston police, and George Kelling, the criminologist
whose advocacy of quality-of-life arrests had largely been adopted by
Bratton. A tape of the March 25, 1993 interview with Bratton reveals the absence
of any clear Giuliani crime plan, with Rudy asking if it was" conceivable to assign
police officers to the task of restoring order on the streets," removing "the panhandlers
and squeegee operators." Giuliani also seemed concerned about what he
called "minority sensitivity and police brutality," asking if complaints had gone up
when Bratton launched a quality-of-life arrest offensive while he was the head of
New York's transit police in the early 1990s.
The guise for these sessions was an open ear. But Rudy was also hoping that
policy bridges might either neutralize potent enemies from 1989 like Cuomo and
Feldman or recruit new allies. Wagner did a pivotal commercial in the end, lending
Rudy the legitimacy of the state's most famous Democratic name other than
Roosevelt (his grandfather was U.S. senator and his father was mayor). Stern
posed as a civic critic, assailing the ethics of the Dinkins administration, then
quickly assumed his old Parks post when Rudy took office. Horton, the most
quoted overseer of city management for twenty years, praised Giuliani's campaign
white paper on fiscal policy, undercutting Dinkins's attempt to belittle it.
Rudy also attached himself to the Manhattan Institute, a think tank backed by
rich, right-wing foundations that was trying to achieve a new urban politics by
bankrolling thinkers and commentators who would popularize pieces of its ideology.
Rather than talk to poor people, Rudy decided to listen to the Institute talk
about them. He came away from periodic tough-love luncheons at the Institute's
midtown dining room with a welfare and homeless philosophy more focused on
dependency than decency, better suited for saving money than saving lives. These
trendy poverty lessons at least guaranteed Rudy wouldn't reappear in 1993 as a
Lindsay liberal, a hopeless niche anyway in a contest against a black mayor.
Though a tax-exempt nonprofit insulated from partisan politics, the Institute
was named on the seating list for Giuliani's first big fundraiser-held in May
1992-as responsible for sending ten people, mostly staff. In addition, some of the
heavy-pocketed Institute donors wound up buying tickets to the fundraiser, as
well as to those that followed. The $l,OOO-a-head grilled-chicken dinner at the
Sheraton, featuring Giuliani client Willie Mays and jazz xylophonist Lionel
Hampton as the only black men in the ballroom not carrying a tray, was an opportunity
for Giuliani to display for a thousand supporters his newfound municipal
competence. "New York City needs more than a symbolic mayor," he declared.
"New York needs a substantive mayor, a mayor dedicated to a fundamental restructuring
of our city."
William Weld, his Justice friend who was the new governor of Massachusetts,
appeared as both a speaker at the dinner and the embodiment of the candidate
Rudy wanted to be, a social moderate as pro-business as pro-choice, as fiscally firm
on finances as he was physically fierce on crime. The Weld model was also mildly
pro-gay, friendlier than the no-bereavement-leave Rudy of 1989, but restrained
enough to draw the line, as Rudy did, on issues like a new Board of Ed curriculum
that exposed grade school kids to lifestyle facts about gays.
A couple of months before the dinner, Giuliani boycotted the St. Patrick's Day
Parade, joining Dinkins and expressing outrage at the refusal of organizers to allow
gays to march as a banner-wielding contingent. Declaring that he didn't "buy the
notion that the parade is a religious event," Giuliani stayed away because the
Hibernians, the church-tied group that sponsors it, "didn't resolve the inclusion issue."
Not only did Giuliani announce his agreement with "the point that gays and
lesbians are making-that the parade is not private and is essentially a political parade"-
but he did precisely what Weld was doing in Massachusetts. Weld explained
his own boycott by calling Boston's gay ban "discriminatory" and "wrong."
Giuliani's ambivalence on gay issues was so strong, however, that he marched in
1993-just seven and a half months before the election-and criticized Dinkins,
who was still boycotting. When Dinkins tried to award the permit to a new group
that would've allowed a gay contingent to march, Giuliani said: "The legal rights
are clear. I'll give the mayor some free advice: Permits should be given to the
Hibernians because failing to do so violates their First Amendment rights." The
Civil Liberties Union agreed, and so did an Irish federal judge, leaving the parade
in the same hands that continued to bar the gay group.
Neither Rudy nor the media noted that the Hibernian parade chair went to the
organization's 1992 national convention and tried to bar from future parades the
unit of his own organization that had allowed gays to march with them in 1991,
calling them "the fag division." Weld also marched in 1993, but only because a
court in Boston had ruled against the gay ban.
Rudy's 1993 turnaround may in part have been prompted by Cardinal John
O'Connor's public comments when Dinkins and he boycotted. The cardinal
praised one city leader who showed, Council Speaker Peter Vallone, and said "we
will not forget" that he came, emphasizing that he would "personally remember."
An editorial in the archdiocesan newspaper, printed with the obvious imprimatur
of the cardinal, added that politicians who shunned the parade had "gone public
with their priorities," thus indicating that "the Irish and the Catholics are pretty
far down the list."
When Rudy also marched in a later St. Patrick's parade on Staten Island, he got
a hero's welcome to chants of "Save Us Rudy," "Dinkins Sucks" and "No Queers
Here." When asked about the bombast from his supporters, Giuliani said, "The
anger level, or the irrationality level, is not disproportionate on one side or another
of this thing. It's on both sides." His cosmic reference went well beyond gays
or blacks. It was an apparent commentary on the conflicting mindsets that were
increasingly cutting the city in half.
Giuliani's ambivalent groping on gay issues was mirrored on a host of fronts. Like
his oscillations on gay matters, his unpredictable repositioning on a variety of other
issues began in the early Dinkins days and continued right up to the election.
He refused, for example, until mid-September 1993 to say anything substantive
about homelessness, initially accepting and then declining a spring invitation to
speak at a housing conference with Dinkins. After making the homeless a "matter
of conscience" in 1989, he dramatically shifted gears in late 1993, announcing a
plan whose centerpiece was a tough new ninety-day limit on the shelter stays of
what he called the chronically homeless. He also said the city had to abandon its
long-standing commitment to a right to shelter, saying he would seek "legal relief"
from court orders won by Bob Hayes, the advocate who had walked him
through shelters four years earlier.
The plan was so transparently in violation of the consent decree Hayes won that
Giuliani never attempted to implement it when he became mayor. Its purpose,
however, was to show a willingness to flex municipal muscle at what the Post now
called the "intimidating" homeless, just as his 1989 embrace of the homeless was
designed to implant a charitable heart in a prosecutorial profile. With "liberals"
like Pete Hamill reflecting the changed public attitudes about the homeless in a
New York magazine cover story that advocated quarantining them in unutilized
military camps, Giuliani's plan also called for stepped-up police enforcement of
quality-of-life ordinances to get them off the streets. It referred to some homeless
as "menacing individuals."
Hidden beneath these headline-grabbing, tough-love initiatives were remnants
of the compassion that characterized his 1989 approach. He still promised that "a
cornerstone of the Giuliani policy" would be "substantially increasing drug treatment
availability" for the 50 percent of homeless singles he estimated were chemically
addicted. In separate comments unconnected to the homeless plan, he
continued to favor treatment on demand. He made similar, ambiguous commitments
to the mentally ill homeless, supporting their "right to receive treatment in
the community." Gone was the concept of small shelters in every neighborhood in
the city. Gone was the forceful commitment to permanent housing.
There was still, however, enough political uncertainty about how this "round-
'em-up-move-'em-out" Rudy floated politically that when advocates assailed the
approach, Giuliani softened. The Post accused him of "retreating within days" because
he started talking about "exceptions" to the ninety-day rule, and how people
might "have their stays 'extended.'''
Giuliani also adopted the harsh and hurtful rhetoric of Dinkins's severest critics
in a bitter dispute between blacks and Jews, only to try to moderate his language
in the final weeks of the campaign. He capitalized immediately on a 1991 riot in
the Crown Heights section of Brooklyn, when a black mob killed an Orthodox
Jewish scholar, Yankel Rosenbaum, and assaulted at least forty others over a threeday
period. The riot was triggered by the death of a seven-year-old black boy, who
was killed by a car traveling in a motorcade that carried the world leader of the
Lubavitcher sect, a large Orthodox community centered in the heart of the otherwise
black neighborhood.
Rudy joined the outcry against Dinkins, blasting police paralysis during the outbreak.
When the only youth indicted for Rosenbaum's murder was acquitted by a
largely black jury in October 1992, an angry crowd of Lubavitchers, led by
Rosenbaum's brother Norman, marched across the Brooklyn Bridge to protest at
City Hall, though Dinkins had nothing to do with the criminal case. Those most
outraged began calling the riot a "pogrom," Yiddish for Nazi-like, state-sponsoredor-
sanctioned violence against Jews and-Giuliani soon embraced the term.
Ultimately, by the summer of 1993, he said he would no longer use this incendiary
expression, even as he continued to bore in on Dinkins's provable Crown
Heights passivity. Rudy's reversal was prompted by a state finding that neither
Dinkins nor the police commissioner had issued any sort of a stand-down order
that led to the police inaction. But Rudy still wouldn't concede that "pogrom" was
excessive, saying only that he wouldn't initiate the use of it again. If asked, he
would continue to discuss its relevance to Crown Heights.
Backing away from this hyperbole was part of an on-again, off-again Giuliani
effort to make Crown Heights another competence issue, turning the hamstrung
cops into a management rather than a racial failure. Giuliani vacillated between attempts
to defuse the suggestion that Dinkins was more concerned about police violence
against black rioters than he was about terrorism against Jews in their
homes, and attempts to exploit that charge.
Even as Rudy soft-pedaled the use of "pogrom," he remained closely aligned
with the Lubavitcher plaintiffs and attorney who sued the city in 1992 and
charged that Dinkins consciously permitted blacks "to vent their rage at the expense
of the lives and property of Jews." He invoked this "pogrom" lawsuit in a
television ad, feeling no apparent need to distance himself from the smirking
lawyer who derisively asked Dinkins during a Gracie Mansion deposition if he
knew "what a yeshiva was."
Rudy's penchant for having it both ways was particularly acute whenever the
issue was black and white. He swung back and forth between explicit and coded appeals
to race, on one hand, and conscious retreats from it, on the other. In the space
of two weeks shortly before the election, he at first derided Dinkins for granting a
permit to Louis Farrakhan for a Yankee Stadium rally, but subsequently said: "I
would protect Farrakhan to the same extent as I'd protect someone that I agreed
with."
Giuliani's initial declaration that he "would not allow Farrakhan to use city
property" -comparing the planned rally to allowing "neo-Nazis or skinheads to
rent Yankee Stadium" -boomeranged in the press and polls. So with just four
days to go before the election, he said: "Farrakhan has a right, unfortunately, from
the point of view of the sensibilities of people, but fortunately for the First
Amendment, to express that viewpoint."
Other shifts were stretched out over the years of pre-election positioning. As far
back as the end of 1991, Giuliani did an extended interview on WNBC-TV and accused
Dinkins of "playing racial politics" to get himself "out of political difficulty,"
saying the mayor "was as responsible for creating ethnic or racial divisions" as the
people attacking him. Dinkins was hiding "behind black victimization too often,"
Giuliani charged, claiming that the mayor was "whining" that he was being "held to
a different standard" because he was black. Rudy said such victimization was "very
destructive-he did it when he was running; and he does it now."
By planting so early a seed that Dinkins was seeking special treatment-a kind
of affirmative action program for thin-skinned black mayors-Giuliani was laying
the groundwork for future, unbridled attacks. Yet by July 1993, he was claiming
that it was he who was being judged by an unfair double standard. "From a cold
political calculation," he told the Times, "you take the issue of race out of this and
I win by 15 to 20 points." Make this "a normal American election," he insisted
elsewhere, "and I win." He could not make up his mind if he wanted to paint himself
as a race victim, or his opponent as a race whiner. All he knew was that it
helped him to talk about race.
So he figured out a way to talk about race while pretending he wasn't. "I've got
to get this city to stop thinking in categories, to stop thinking in terms of black and
white and Hispanic, gay and heterosexual. I've got to get New York to stop thinking
about all this symbolism." When confronted with the fact that only two of his
thirty-seven campaign aides in 1993 were black, Giuliani's campaign spokesman
said "we don't believe" in keeping numbers like that and accused the Daily News
reporter who raised the issue, Paul Schwartzman, of being a "racial arsonist." The
Giuliani brass railed about Schwartzman to his bosses.
Rudy accused Dinkins of relying on "symbolic hiring and not on selecting people
of quality" in putting together his administration. He promised to find "people
of quality," adding that a government that is "a cross-section of the city" was
a "secondary" consideration. The candidate extended the same color-blind reasoning
to a Dinkins set-aside program for minority businesses, calling anything that
was race-based "terribly divisive."
Yet, when Giuliani appeared at a July 1992 Institute for Puerto Rican Policy forum,
he was quite willing to "think in categories," as well as to champion "symbolic
hiring," suggesting that the color-blind rhetoric only applied when he was
talking to white media about Dinkins's supposed favoritism in hiring blacks.
"I know that there are more than enough qualified people in the Latino community
to take over any of the positions in the government in New York City," he
said, suggesting, as he did more explicitly on other occasions, that Dinkins had not
appointed enough Latinos. "And it is the art and science of governing effectively
to find these people, empower them, put them in positions where they can truly
represent the community.
"I believe very, very much in role models. I believe that the young people have
to see people in significant positions in government in the City of New York that
they can look up to and they can identify with, whether they're Puerto Rican or
otherwise Latino, or Jewish or Italian or African American. The single most important
change the city has to make is people have to get appointed to public office
for the right reasons." Giuliani not only stressed this "view on appointments," as
he put it, to high-level positions-vowing "to share power in an appropriate
way"-but he berated Dinkins for "not recruiting cops at all in the Latino community."
This was another specially tailored Rudy Affirmative Action Programdesigned
solely for the community that could give him a decisive swing vote, and
it went unreported in the white press.
By the close of the campaign, any celebration of a consciously inclusive government
was forgotten and the chameleon candidate was instead insisting that all his
appointments would be based solely on merit, "irrespective of race, religion, ethnic
background and sexual orientation," just like his virtually all-white and allheterosexual
campaign staff. With less than a week until election day, Rudy took
to accusing Dinkins of hiring by race.
While 180-degree turns-on Saint Patty's, homelessness, Farrakhan, racial double
standards and inclusiveness-were easy pirouettes for the dexterous Rudy, he
seemed to only be able to flip in one direction, ever rightward. By the time he got
to election day, in fact, it was a wonder that the entire right side of his body wasn't
gripped by carpal tunnel syndrome, that cruel consequence of repetitive motion.
***
Giuliani flipflops were also occurring on the crassest of political levels, where
AI D' Amato still hovered. Rudy lived in fear of another D' Amato-inspired
Republican primary. Arnold Burns, the 1989 finance chairman for Rudy, talked
openly about how disastrous a repeat Lauder-like scenario would be, calling it a
"plague." D' Amato, of course, did all he could to suggest that another challenge
was in the offing.
A millionaire Republican businessman who'd long given to D' Amato, David
Cornstein, was floated as a possibility. He even paid for focus group research on
the race in the summer of 1992. Cornstein was also reported to have retained
Arthur Finkelstein, the D' Amato and Lauder campaign consultant, and was talking
to GOP leaders.
So was Andrew Stein, the City Council president whose rich father, Jerry
Finkelstein, was so close to D' Amato that the senator made him the first nonlawyer
to sit on his judicial screening panel. D' Amato allies talked of allowing
Stein to run in the Republican primary even though, as a Democrat, he would require
a waiver from three of the city's five GOP county leaders to do so. With the
Bronx's Guy Yelella and Brooklyn's Bob DiCarlo in his pocket, D' Amato was
within striking distance of the majority he needed for the waiver.
When Stein threw his biggest campaign bash in January 1992-hosting a
Waldorf grand ballroom extravaganza with Frank Sinatra and Liza Minnelli-a
D' Amato army attended. Yelella and DiCarlo were listed on the seating arrangement
at the same table as D' Amato clones like Charles Gargano, the senator's top
fundraiser. Also listed were Conservative Party county leaders Serph Maltese and
Jim Molinaro, who were D' Amato allies targeted for the same Stein waiver, making
him a possible Conservative candidate.
This group-as well as Stein's welcome at a Conservative Party cocktail party
honoring Lauder-was an announcement of D' Amato's threat to back Stein.
Freely talking about the possibility of running in a GOP primary, Stein also declared
early, like Lauder, that he would opt out of the expenditure and contribution
restrictions of the city's Campaign Finance Board system. That meant he was ineligible
for public matching funds, but could raise virtually limitless sums from
his family, and tons of tawdry tycoons tied to Finkelstein and D' Amato.
Rudy did not fear losing a GOP primary to Stein, but he couldn't afford another
spate of ugly primary ads. He feared another well-financed spring and summer
battering that might squeeze him ideologically and damage him personally, weakening
him for November.
What was most disconcerting to Giuliani early on was the courting of Guy
Molinari, the head of the 1989 campaign who controlled the only Republican borough,
Staten Island, like a fiefdom. His daughter Susan was the Island's representative
in the House, inheriting Guy's old seat, and both the GOP and Conservative
leaders from the county were close allies. Finkelstein was wooing the Molinaris
with donations. Guy Molinari could be heard offering tributes to Stein, one in a
late 1991 Times story that sounded like a virtual endorsement.
Molinari was even more important in 1993 than in 1989 because a referendum
on the possible secession of Staten Island from the city was scheduled to appear on
the same ballot as the mayoral election. That meant turnout in the city's whitest
borough-where secession had become a hot cause in the Dinkins years-would
be up dramatically.
Giuliani would milk the secession issue in 1993, using a previously undisclosed
letter Dinkins wrote to Mario Cuomo opposing the secession referendum. Dinkins
merely quoted from an Abraham Lincoln speech about the need to oppose a minority
breaking up the government "whenever they choose." Yet Rudy used the
invocation of Lincoln as evidence that Dinkins was trying "to put his opposition to
secession in racial terms," making "things worse." When Dinkins insisted he had
"never, ever come remotely close" to injecting race into the battle, Giuliani contended
that" comparing the Civil War South to Staten Island clearly raises it," justifying
his own fanning of the flames.
With just a little rhetorical kerosene and Molinari's organizational support,
Giuliani expected to get the margin he needed on Staten Island alone. Molinari's
message, when D' Amato boycotted the first big Giuliani fundraiser in May 1992,
was clear: "1 would hope that he and D' Amato can have some sort of detente," he
told the Times. "It's very important to both of them. I've been trying to negotiate
something myself, since I'm probably one of the few people who's very friendly
with both of them. But not too much luck so far."
Giuliani reminded reporters at the same fundraiser that D' Amato" supported
me about six weeks before the 1989 election and he did it on the telephone." This
comment was designed to respond to pressures on him, from Molinari and others,
to endorse D' Amato, who was facing a tough re-election challenge that November.
Refusing to say he would back D' Amato, Giuliani bristled over the heat he was
getting from GOP county leaders: "I've never been persuaded by threats, including
when the Mafia threatened to kill me," he declared.
One of those leaders, thirty-six-year-old DiCarlo, had taken over the Brooklyn
party in the fall of 1991. Financed by $30,000 in Lauder donations, he defeated a
slate of Giuliani allies in a county committee battle (DiCarlo had run Lauder's
campaign in Brooklyn in 1989). DiCarlo's ties to the D' Amato crew were so strong
that when he joined a small venture capital firm in September 1992, he listed
Lauder, Cornstein and Gargano as investors he was bringing into the business on
a schedule attached to his employment agreement.
A recent bankrupt with a spotty employment history, DiCarlo executed this
business agreement two days after he successfully beat back an attempt by
Giuliani backers on Brooklyn's GOP executive committee to engineer an early
mayoral endorsement. DiCarlo made it clear at the executive session that he
would only entertain an endorsement after Giuliani announced he would back
D'Amato. The Brooklyn leader's successful rebuff of the 1992 endorsement suddenly
became a key factor pushing Rudy toward a painful peace with the senator.
Giuliani had lost the frontline prosecutorial weapons he'd tried to use against
D' Amato-Lombardi and McGuire were gone. Otto Obermaier, not Benito
Romano, was riding herd at Foley Square. As late as 1992, a Giuliani loyalist in the
Southern District, David Lawrence, was trying to flip a felon who'd pled guilty,
Arnold Biegen, to use him against D' Amato. Biegen allegedly had information implicating
D' Amato in an attempt to get a top Housing and Urban Development
(HUD) Department official to lie before a federal grand jury.