Steven Malanga of Public Sector Inc. highlights the struggle of New Haven’s Democratic Mayor John DeStefano Jr., a longtime ally of public sector unions who has taken a belated stand against soaring compensation costs to forestall a punishing tax increase:

[DeStefano] has faced street protests by public workers and their supporters, including the Rev. Al Sharpton, over his refusals to raise taxes to balance the city budget. In February the city laid off 82 workers to close a $5.5 million budget gap in the current fiscal year, which ends June 30, after unions refused to compromise with DeStefano, who was seeking a range of concessions, including greater contributions from city workers toward pension costs. The mayor freely admits that he was guilty of granting some of the government perks he now terms “unaffordable” and is seeking to trim.

Better late than never.

As Shelly Banjo of the Wall Street Journal reported last month, downtown New Haven has experienced a modest revival. Devastated by baldly misconceived “urban renewal projects,” New Haven spent much of the latter half of the twentieth century on life support, barely sustained by largesse of Yale University and state and local government as residents fled to neighboring suburbs and to the Sunbelt. In recent years, Yale has spearheaded a more constructive effort built around encouraging local entrepreneurs and artists to make use of otherwise derelict space. And it turns out that at least a few technology entrepreneurs, most of them Yale alums, have found the new New Haven a congenial environment:

Drawn by lower rents and access to the university’s resources, Yale graduates and other entrepreneurs are choosing for the first time in decades to launch their businesses in New Haven instead of traveling to Boston or New York City.

It’s easy to see why DeStefano is willing to face down the public sector lobby: the city of New Haven is gaining a bit of momentum, and serious tax hikes would put an end to that.