Bennett Liebman has a short academic paper on the use of the phrase and what it says about politics in Albany.
“Three Men in a Room” and Albany Where Did the Phrase Come From?
There have been regular meetings of the Governor and the legislative leaders since at least 1943 when Governor Thomas Dewey came into office. While given the dominance of Governor Dewey over all aspects of New York State government, these meetings were closer in reality to one man in a room rather than three in a room, the fact is that New York State government has had three leaders in a room making key legislative decisions for close to three quarters of a century. This practice has become recognized as “three men in a room.” A quick look at Nexis shows 1,194 occasions where the term “three men in a room” has appeared in the same article as the word “Albany.” There is even a book entitled Three Men in a Room: The Inside Story of Power And Betrayal in an American Statehouse….
The phrase “three men in a room” is nearly always used disparagingly to mean a secret non-transparent process under which a small group of officials make the decisions for the entire State. Yet, there is occasional support for the process. It has been called the “ungovernable polity” defense. As political scientists have written, “Building support and legitimacy for compromises within a democracy is difficult, and the process in New York reflects how protracted that process can become…. [As most members see it,] strong leadership is a self-inflicted ‘necessary evil’ to achieve agreement. As long as the leadership is responsive to member needs the members are likely to continue to support a strong leadership system.” Crain’s New York Business has noted, “’Three men in a room’ is sometimes a necessary alternative to political pontificating by 212 legislators and a governor…” Even Blair Horner of the New York Public Interest Research Group has stated, “The three men in a room problem was one of degree, that so much business, including the entire budget, was done in complete secrecy…But you have to have leaders’ meetings. They have to talk to each other. Otherwise, how do you get anything done?”
The “three men in a room” problem in New York is the inherent and continuing difficulty in establishing a proper balance between executive and legislative leadership, transparency and functionality.