2008: The year in review

It was a year of dramatic ups and downs, with the international financial crisis seizing Wall Street, a prostitution scandal shaking up who resided in the governor’s mansion and New York City Hall revamping its term-limit rules.

News of banks collapsing and filing for bankruptcy dominated the headlines – and the limits of the state and city’s budgets. Bear Stearns nearly imploded in March, but JPMorgan agreed to buy shares of it for a fraction of the firm’s recent market prices and to guarantee its obligations with help from the Federal Reserve. Six months later, after failing to find a buyer, Lehman Brothers filed for bankruptcy. On the same day, Merrill Lynch announced it was selling itself to Bank of America.

All that volatility did not bode while for local budgets, and the governor called multiple sessions and opted to raise taxes on smokers, hair salon customers and others in dealing with a growing deficit. In New York City, negotiations were so tense that the City Council’s budget negotiating team temporarily broke off talks to highlight their frustration with proposed cuts. And during the budget agreement announcement, Mayor Michael Bloomberg and City Council Speaker Christine Quinn forgot to perform the ritual handshake and kiss, until a reporter asked about the tradition.

Meanwhile, Gov. Eliot Spitzer resigned following revelations that he’d been involved with prostitutes, making him the first New York governor to leave office amid scandal in nearly a century. When then-Lt. Gov. David Paterson replaced him, Paterson became the state’s first black executive – and its first blind one, too.

Longtime GOP Senate Majority Leader Joseph Bruno announced he would not seek another term – and, at the time, Bruno said his decision was not related to the fact that he was under a federal investigation, which eventually led to his conviction on corruption charges. (He was later acquitted.)

That fall, bolstered by a surge of new voters headed to the polls to elect Barack Obama president, Democrats won a majority in the state Senate, putting the party in charge of both state legislative chambers and the governor’s office for the first time in decades. Four Democratic senators, however, immediately waffled on whether they would support a Democratic majority leader, foreshadowing a later coup.

In the lower chamber, Assembly Speaker Sheldon Silver killed a congestion pricing plan Bloomberg had thrown his weight behind. Bloomberg envisioned the proposal discouraging driving in the downtown Manhattan core, and therefore alleviating traffic and pollution.

But Bloomberg did score a big win on his home turf: The City Council voted to extend term limits so that Bloomberg could seek a third stint in office, overturning two voter referendums that had resulted in the two-term limit. Given New Yorkers had demonstrated their distaste for extending term limits, Bloomberg had to overcome lawmakers’ opposition at City Hall.

OUR COVERAGE: Andrew Cuomo conducted his first major interview after being elected attorney general with City Hall/The Capitol, which focused on constituents’ wavering trust in government. City Hall also broke the news that Anthony Weiner had decided not to run for mayor, and published an interview with then-Public Advocate Betsy Gotbaum about her considering retiring from politics. (She later did, opting not to seek re-election in 2009.)