New York

Now What? The City Can Still Make It, But Not Alone

“New York heads toward collapse helped im­measurably by a president who apparently feels it is not only good politics but good policy to let the city go down.”

by

Now What? The City Can Still Make It, But Not Alone
November 10, 1975

The quick question: Why is New York City going down the drain? The quick answer: Because, as a conscious matter of national policy, the nation is abandoning its central cities. President Ford’s “drop dead” speech last week made this perfectly clear — but it was only the latest manifestation of a policy that has been operating for years.

Here, for example, are two quo­tations that speak volumes about the decline and fall of the nation’s first metropolis.

In his 1949 love song to New York, E.B. White caught the post-war promise of the city when he wrote:

“New York blends the gift of privacy with the excitement of participation; it is peculiarly constructed to absorb almost anything that comes along without inflicting the event on its inhabitants…”

But 20 years after White, writing in the same literary vein, Fred Powledge drew the opposite conclusion as to New York’s humanity:

“New York has become irredeemably, irretrievably rotten… There is nothing an individual citizen can do that would make New York more livable for more than an instant, not even if he is the mayor.”

Now, five years later, New York heads toward collapse helped im­measurably by a president who apparently feels it is not only good politics but good policy to let the city go down.

How is it the city’s image re­versed itself so dramatically in one generation, White to Powledge? How could the center of the New York region — one-tenth of the na­tion — come so suddenly to its knees? If the ’50s saw 60 percent of all the new office construction in the United States concentrated be­tween 42nd Street and 59th in Manhattan, and assessed valuation zoom accordingly, how did the property tax fail to yield enough to meet budgetary requirements? When federal aid throughout the ’60s grew and grew, why did the ’70s find the Bronx being abandoned?

More fundamentally, when the same years saw NASA shoot off billion after billion into space, and the Pentagon spent 10 more in Vietnam, while federal taxes were cut and farm support sustained, how did cities get it in the neck?

Partial answers flood in these days: The poor minority did it by their unproductive presence. The unions brought it on by their incessant demands. The welfare mess spoiled everything. The politics­-as-usual of the city’s leadership let the people down. The indifference of the urban private sector turned out to be suicidal. Each deserves due weight.

A more fundamental force is at work, a profound, intellectual, and ideological antipathy to cities in general — and New York in particular. Going back over 200 years of history, Morton and Lucia White documented this philosophy in their historical survey of The Intellectual and the City: From Thomas Jefferson to Frank Lloyd Wright. And the beating goes on. In recent years, the case against the city has never been more elo­quently and persuasively advanced than by Edward Banfield in his work The Unheavenly City and Patrick Moynihan, among whose prolific writings one must choose “Maximum Infeasible Par­ticipation” as the most damaging to the need and validity of public action.

Banfield lays the blame for city problems squarely on the poor. Moynihan, in theory and policy advice, is less certain — but he is clear that public action, government action cannot save the cities. Taken together, Banfleld’s proclamation that the condition of the poor is irretrievable, and Moynihan’s scorn of the efficacy of government in any field save foreign affairs have cast a pall over urban public policy that has immobilized thinkers for the past eight years.

But at bottom, even if bold new plans had been advanced from scholars’ studies and university centers, the likelihood of their suc­cessful adoption would have been small. For the twin consequences of the concentration of the poor, the black, and the brown in the central city and the simultaneous diminution of America’s prospects for continued growth and expan­sion rendered impractical the poli­tics on which urban policy was built in the 1960s.

The “old school politics” of America are essentially distribu­tive and majoritarian. That is, an administration in power assumes relatively fixed resources and shifts them among interest groups to achieve majority support. His­torically this amounts to a judicious (although not always just) balancing among farmers, businessmen, and labor. In the ’60s, stimulated by John Kennedy’s ca­pacity to ask new questions, a “new school politics” emerged — innovative rather than distributive and minority-oriented rather than majoritarian. Its practice was based on the circumstances of a vastly growing national income­ that one did not have to rob Peter to pay Paul. Therefore, when Lyndon Johnson simultaneously moved in 1964 to secure Kennedy’s long-sought tax cut and begin the Great Society, he was inviting new programs for the minorities —­ Model Cities, the War on Poverty, compensatory education — without taking away anything from the majority — distributive politics­ — health insurance, highways, heart-stroke, and cancer. So long as Vietnam was not overwhelming in its demand on the Treasury, the strategy was plausible, and indeed in New York City it was working. So what happened?

The Nixon years. Indifferent both to cities and tax policies, faced with deficits he could not manage, resorting to impound­ments of funds appropriated for domestic programs — President Nixon almost unwittingly exposed the vulnerability of an innovative program that did little or nothing for the majority of urban resi­dents. For while Headstart, local clinics, and model neighborhoods began to give power and support to the urban minority, it left un­touched the needs of the urban majority. That failure proved crucial in New York City, in particu­lar, in Ocean Hills–Brownsville and the subsequent school controversies, in the bitter disputes in Forest Hills over new public housing that marred Lindsay’s last years, and in the housing abandonments that began in the outlying boroughs where the “working” Americans lived.

The rage that grew found its most fiscally damaging expression in the militant unionism and wild­cat strikes that have tormented the city administration. For the large­ly white and ethically oriented union membership in the fire, police, and sanitation departments are truly the backbone of the city. Throughout the last 10 years, the members perceived city program after program designed for the poor and the minorities and noth­ing in tangible support for Nixon’s “silent majority.” So new wage and salary demands appeared the only way to get a fair share of the urban purse.

Can we be generous to our ma­jority and innovative in our urban politics, and still save New York City and the day? I think the answer is yes. Here are four prop­ositions — two orthodox, two more radical, none especially accept­able these days.

First, adopt a national income and job program. Accept the fact that the needs of the poor are not a function of the place where they live. Enact a comprehensive federal income maintenance, job opportunity program, fund it nation­ally and stay with it nationally, so we support our citizens wherever they are.

Second, provide a special general purpose federal grant-in-aid to large cities over and above current revenue sharing. The cruel decep­tion of revenue sharing (heralded as it was, as returning money without strings to the grassroots,) was that it left the local governments with the obligation to con­tinue federal programs and the taxpayer with the belief that local taxes could be cut. Only in the richest suburbs could these goals be met. What central cities need is a dividend, as the Conference of Mayors suggested last summer, recognizing the special costs cities sustain given their densities and service requirements and the spe­cial needs of their poor.

Third, undertake urban land reform. Henry George was by and large right when he ran for mayor of New York at the turn of the century on the single tax program. Taxing mostly improvements of land and not land itself enriches the speculator and never recap­tures the incremental value that city government investments and services bestow. By failing to acknowledge that government investments in roads, water and sewer lines, and community facilities are the prime determinates of land value, we lose the chance to make public investments self-sustaining. Instead our present local tax development and zoning policies often yield windfall profits to the banks and industries and still allow them the power to negotiate as to the conditions for public solvency in New York City.

Thus, a city location generates overwhelming advantages to particular private businesses — the home offices of giant corporations, communications, garment trades, specialty stores — through what economists call “external econo­mies of location.” But, simultaneously, each private economy is likely to generate public diseconomy of massive proportions. Example: build the World Trade Center towers, with real estate write-off, appropriate depreciations, and a high density of tenants and customers. A giant step forward for business. Calculate the demands on public transportation, public safety, and public health­ — and the city doesn’t need it.

So, on reflection, the basic mistake of urban renewal since E.B. White wrote in 1949, was that the city did not acquire the land it sponsored — at the tune of two­-thirds of cost. Instead, it sold it to private developers. If the city had leased and taxed on the basis of income received, New York’s municipal poverty might have been relieved by the midtown development and the hidden social benefits realized as well.

Fourth, establish a metropolitan financial district. We should not rely on the complicated interac­tions of federal and state tax levies and subsequent grant distributions to local governments; to tap su­burban resources for central city needs. Indeed, theoretically admirable as the one-man-one-vote de­cision of the Supreme Court was, it replaced farmers with suburbanites in Congress and state legislatures, which then continued the anti-city voting tradition. A metro­politan financial district, ether building on the authority and powers of an existing metropolitan agency, or by interstate compact, could provide revenues appropriate to the services suburbanites receive and introduce at least an element of equalization among America’s 1400 or so separate ju­risdictions.

This district practice was estab­lished on a small scale when Long Island was transformed from farm to suburb 30 years ago. It could be applied more generally, and as a quid-pro-quo include a metropolitan council or assembly empowered to review the city’s own budget. Limited as such ar­rangements are compared to structures in Minneapolis-St. Paul, Nashville-Jefferson County, Miami or Toronto, they would at least acknowledge the metropoli­tan interdependence in a fiscal sense.

One proposition or four, in whatever combination and whatever tone, the political lesson here is that at a time when resources are limited and tempers short, majority-innovative politics ought to be the rule of urban policy. If cities are to be saved and their critics confounded, the nation must be­come engaged. Regulation as a governmental device will need to take the place along side of subsidy in suburb as well as central city. Most of all we need to bring our most precious urban possession — ­land — back into the public domain where it was in colonial America. As a starter at any rate, for Manhattan, we all need a piece of the rock.
Robert Wood is president of the University of Massachusetts and the author of “The Political Economy of the New York Metropolitan Region” (Harvard University Press, 1961).

 

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