Every four or eight years in New York City, on Inauguration Day, a mysterious transmutation takes place: the streets, the schools, the police, the weather, crime, and sometimes death itself suddenly belong to a new mayor, the way a book belongs to its author. Whether he is up to it or not, each mayor is vested with the very substance of the city during his time in office.
Think of Ed Koch (1978–1989), blustery and avuncular, with his high, brash, Bronx-bred self-regard. Under a tweed cabdriver’s cap Koch performed his contagious Yiddishkeit smile. His lasting accomplishment was to create affordable housing by reclaiming derelict buildings from the previous decade. Koch came to love his power so dearly that after voters rejected his bid for a fourth term, he declared that “they will be punished” for their decision, softening the curse with his twinkling satyric eyes.
Or Michael Bloomberg (2002–2013), who ran the city as he’d run the eponymous corporation that made him one of the wealthiest people in America. Bloomberg preferred his Upper East Side town house to the relatively cramped quarters at Gracie Mansion. On weekends he and his girlfriend flew in a private jet to his vacation compound in Bermuda. His vision of the city was as conceptual as an architect’s drawing, but he partially made the concept real, creating bicycle lanes, closing streets to traffic, and generally promoting a welcoming atmosphere for tech workers from both the suburbs and abroad. He openly beckoned billionaires to New York, providing them with the amenities they prized. His grand opus was the superfluous Manhattan development Hudson Yards, for which he squandered funds that could have been better used for affordable housing. This was especially true as the real estate market spiraled out of reach and the rent-stabilized status of Koch’s rehabilitated buildings began to expire, putting the units on the open market. Hudson Yards’ multimillion-dollar apartments and luxury shopping arcade were like a punch in the nose to ordinary New Yorkers.
New York’s current mayor, Eric Adams, brilliantly carved a path to City Hall with the overwhelming support of black and Latino voters in Brooklyn, Queens, and the Bronx in the Democratic primary. (In Manhattan Adams largely restricted his campaign to Harlem and Washington Heights; he swept most of Upper Manhattan.) Big money donors from both parties embraced him. He seemed to be their perfect candidate, a former cop with a pliably populist veneer. But his brazen cronyism betrayed his constituents and eventually the very ethos of the city. In what many New Yorkers saw as an attempt to avoid serving hard time in jail, he gave Trump an open pass to persecute the city’s immigrants.
No mayor I know of embodied the city he presided over more thoroughly than Abraham Beame, who occupied Gracie Mansion during the city’s most dramatic postwar panic, 1974–1977. This is the fiftieth anniversary of New York’s descent into the abyss of near bankruptcy, the year of the indelible Daily News headline, “FORD TO CITY: DROP DEAD” (October 30, 1975). Michael Rohatyn and Peter Yost have assembled an absorbing documentary anatomizing the drama that ended with New York narrowly avoiding default. Its tongue-in-cheek title is Drop Dead City.
Abe Beame was a sturdy bantamweight about five feet tall. Standing with other politicians he seemed to disappear. Journalists towered over him. He was invisible in crowds where he was meant to be the center of attention. His diminutiveness matched that of the city, with its shrinking population, gutted apartment buildings, and ravaged storefronts. The air in the 1970s was heavy with leaded gasoline, soot, and flying scraps of garbage. One afternoon a dump truck fell through the crumbling road of the elevated West Side Highway.
Beame was sometimes pugnacious, bearing his lack of physical stature by ignoring it, like a barking miniature dog. But he didn’t get to City Hall by being confrontational. He inched upward through the political ranks, starting out in 1930 as a Democratic clubhouse apparatchik in Crown Heights, Brooklyn. His job was to fix things for dependable voters in the district: a dispute with the landlord, a better public school for the kids, turkeys and petty cash for Thanksgiving.
He was born in 1906 in London, where his parents briefly camped after fleeing Poland, en route to New York. His real name was Birnbaum, another poor Jewish immigrant kid on the Lower East Side when it was a multiethnic slum, crowded to an unimaginable degree by today’s standards. He married a girl he met when he was fifteen playing checkers at a settlement house. They stayed together for sixty-seven years, until she died.
This was Beame: prudent, sensible, a quick study. He got his accounting degree at City College, taught in a public high school, and provided his accounting services to the bosses in the party. He rose on schedule within a political machine that groomed its leaders with the diligence of the Soviet-era Kremlin: budget director in the 1950s, comptroller in the 1960s and early 1970s. He was sixty-seven when he was inaugurated as mayor, wearing large black-framed glasses and combed-back silver hair. His thumb-size sideburns, a Seventies style, bookended his broad, serious, brown-spotted face. The sideburns didn’t fit him. Beame had been formed in pre-war New York, the product of a world of European immigrants who by 1975 had largely forsaken the city. At heart he was an FDR Democrat, devoted to the government-funded institutions that enabled the children of white paycheck-to-paycheck families like his to flourish. He took office as a numbers guy, a solid manager who would keep the precarious gears of New York’s largesse well oiled.
But Beame’s successor as comptroller, Harrison Goldin, blasphemously decided to conduct an audit of the city’s finances. He found that New York’s budget was essentially a Ponzi scheme. Subsequent audits unveiled a debt of $6 billion, with no obvious way of ever being repaid.
The architect of the scheme was Nelson Rockefeller—grandson of America’s foremost robber baron—who had been governor of New York from 1959 to 1973. When the city needed money, Rockefeller would approve new debt in the form of vague financial instruments like “tax anticipation bonds,” “bond anticipation notes,” and, vaguest of all, “moral obligation bonds”—debt that was backed not by hard assets but by blind trust. It helped that Nelson’s younger brother was chairman of Chase Manhattan Bank. With Rockefeller’s assurance a consortium of New York banks shared in the lucre: the salesmen got their commissions, the banks collected their interest, and the bonds needn’t be worried about until they matured.
Once the extent of the debt was made public, along with the news that the city had no accounting system—“no fucking books,” in the words of the head of the Emergency Financial Control Board—other than boxes of canceled checks moldering in a closet, the procession of new bond sales came to a halt. There was no money to pay city contractors or workers. The crisis was so severe that payment to purveyors of milk for school lunches was deferred.
The inside players had known perfectly well what was going on, but the revelation made business as usual impossible. They pretended to be blindsided, outdoing one another with expressions of bewilderment and surprise. This included Beame, the master accountant and quintessential machine politician. His reputation was so damaged that he called Goldin a liar. New York’s tax base, a shorthand for middle-class whites, was disappearing. Welfare rolls were rising; local businesses were collapsing. Forty-six thousand city workers were slated to be laid off. The grisly task of implementing the layoffs, closing libraries and public pools, doubling class sizes, cutting garbage pickup, and more fell to Beame. One banker warned that if New York defaulted it would become “a Calcutta.”
The rest of the story is well known, but with its riveting archival footage Drop Dead City evokes anew the sensational antiglamour of the Seventies. In the sweltering heat of summer, sanitation workers went on strike. An epidemic of landlord-funded arson ensued—the market value of the buildings was less than insurers would pay if they burned to the ground. Facing layoffs, members of police unions warned tourists to stay away lest they be robbed in their hotel rooms, mugged on the street, assaulted on the subway, or worse. The logo of their campaign—called “Fear City”—was a hooded skeletal face of death. The message was, We won’t protect you.
The unions were at one another’s throats, too. After sanitation workers settled with the city, Ken McFeeley, the president of the patrolmen’s union, fumed that the sanitation workers would get extra pay “cleaning up the mess they made for the last three days…. We’re up to here with Beame. They’re using us and I hope to God the damn city blows up.” When Albert Shanker, the president of the United Federation of Teachers, resisted lending his members’ pension fund to the city, Victor Gotbaum, the head of the largest municipal workers union, which had pledged hundreds of millions of dollars, said, “I almost threw him out the window.” But they were all in the same predicament. Collectively, unions had the power to cripple the city by raising drawbridges and closing roads so that vital supplies couldn’t get in. Gotbaum staged a huge demonstration at Citibank headquarters that made employees afraid to come out of the building for lunch. When union leaders met with elected officials, bankers, and high-ranking bureaucrats, one of the cops placed his handgun on the table, setting the tone.
The power broker at these meetings was Felix Rohatyn, a partner at the investment firm Lazard. (His son, Michael, is codirector of the film.) He earned the nickname Felix the Fixer because of dubious activities on behalf of one of his clients, the conglomerate ITT. He suggested to a friend that his decision to help the city in crisis was in part to make amends for that stain. But his motives were surely deeper. An Austrian Jew whose family fled to the US in 1942 when he was thirteen, Rohatyn feared the widespread popular unrest that could be provoked by severe economic dislocation. Rohatyn was a man of subtle intelligence with an innate suspicion of capitalism’s penchant to cannibalize wealth more quickly than it creates it, and a strong belief in government regulation. He worked indefatigably to arrange an improbable deal between the state, the feds, the unions, and the banks, even as he admitted that the city would emerge with less control over its future.*
There was no more poignant presence at the emergency meetings of 1975 than Beame’s. At the White House in May he sat next to President Gerald Ford. On Ford’s other side was New York’s governor, Hugh Carey. Ford and Carey had been in Congress together, and they leaned toward each other chatting comfortably. Sitting directly across from them was Nelson Rockefeller, now Ford’s vice-president, and Treasury Secretary William Simon, who had been in charge of selling municipal bonds at Salomon. Simon and Rockefeller whispered and laughed, seemingly at the expense of Beame, who sat swallowed in his chair staring into the middle distance, in conversation with no one. With stupefying falseness Rockefeller and Simon told Ford they had no idea how New York City fell into such desperate straits.
Drop Dead City lingers on Beame in similar situations, the portrait of impotence with no choice but to occupy a seat of honor as the crisis raged on around him. His stoical, floating stare became the city’s signature. Sometimes he appeared to be fighting back tears. Other times he simply closed his eyes, a beatific sufferer. He was the hollow mayor of a hollowed city. Layer after layer of power was stripped from him until, in the words of a former New York Times reporter, “he was absolutely devoid of power and he knew it.” By year’s end he was reduced to a figurehead, a ribbon cutter, a greeter of dignitaries visiting the city.
Meanwhile a festering suspicion of New York among large numbers of Americans blossomed into open hatred. The flaming buildings, the rising murder rate, the riots, and the camera-ready parade of prostitutes, homosexuals, immigrants, punk rockers, and black residents were living proof that liberalism had bred a nightmarish social order. Republicans hectored and belittled the city with unconcealed schadenfreude. New York was America’s Sodom. Driving across the country with New York license plates in 1975, I had to pretend at gas stations to be from upstate to dodge insults and worse.
A month after the Daily News’ Drop Dead headline, Ford granted New York a $2.3 billion “temporary line of credit.” The city, he concluded, was too big to fail. The unions ponied up $1.5 billion from their pension funds, Albany increased taxes, jobs were slashed, and Rohatyn’s brainchild, the Municipal Assistance Corporation, made it possible to resume the selling of bonds.
Seven years later Wall Street went on an upward tear, young professionals began replacing the middle-class depletion of the Sixties and Seventies, and landlords exploited a mania for turning apartment buildings into co-ops and condos. The unions were made whole, but their influence waned. Tourists flooded back. “Fear City” was now “Fun City,” as Mayor John Lindsay had insisted it was back in 1966—for some.
The crisis emboldened antiliberals in both parties: the L-word became a poisonous label from which a new generation of Democrats recoiled. So-called public–private partnerships for new initiatives were encouraged, and the corporatization of public spaces became the new urban ideal. Credit for improvements and social amenities went to companies, not government, and the perception of who our benefactors were changed.
The crisis of 1975 intensified a view of American life that allowed Reaganomics, with its mantra of small government, to thrive. Today Republicans are peeling away basic rights and services from ordinary Americans at breakneck speed. And the popular unrest that Felix Rohatyn feared fifty years ago has become a pressing national concern.
English (US) · 