The Streets Were Paved with Gold (46 page)

Rather than accept blame for at least part of what happened to New York, the left too often portrays the city as a victim of a giant right-wing conspiracy. “Our true sin, in the eyes of Philistine skinflints and neo-conservative ideologues,” writes Irving Howe, editor of the socialist magazine
Dissent
, “has been the decency—if not sufficient, still impressive—with which New York has treated its poor.… The assault on the city is an assault on maintaining, let alone extending, the welfare state. The assault on the welfare state is an assault on the poor, the deprived, the blacks, the Puerto Ricans.” No doubt, many conservatives use the New York example as a weapon to bludgeon liberalism—a central thrust of William Simon’s book. But the thrust of my argument is practical, not ideological. Not whether New York often tried to do the right thing but whether, alone, it could afford to; whether it worked.

The New York crisis can be seen from many perspectives—from the left, as the result of capitalism’s need to search out cheap labor and reduce costs; from the right, as the logical consequence of intrusive government. Both arguments are, simultaneously, true. But the left tends to get so exercised that it overlooks some other truths. Take, for instance, the city’s 40 percent subway fare increase in 1975. Many cried, with considerable justice, that this was counterproductive and would lead to the loss of many more riders. That September, the city needed to borrow $906 million to meet its monthly cash needs. Sixty-five percent of this sum was earmarked to repay interest and principal on previous loans, much of which could have been eliminated if previous mayors had not borrowed so promiscuously. Just one-fifth of this September 1975 debt service payment—$120 million—could have spared the 35¢ subway fare.

An ideological view of the fiscal crisis—either from the right, which just blames the left, or from the left, which just blames Washington or capitalism—broadens the risk of bankruptcy. In truth, New York will not be able to dig itself out of its hole without additional
federal help, particularly in restructuring its growing debt burden and also in the form of continued federal pressure for local reform. More important is what the city must do for itself. If New York accepted the excuse that it was solely a victim of outside forces, there would be little impetus to alter past habits. Again, as in the South Bronx, the city would fail to confront cold reality or make choices. If it’s not New York’s fault, how can it be our responsibility? Therefore, if vast new federal assistance is not forthcoming, if federal loans are not renewed indefinitely, if the banks don’t open their vaults, if the immutable laws of capitalism don’t change—if the city continues to avoid radically restructuring its budget and service delivery system—bankruptcy is almost inevitable. An unelected federal judge will then be empowered to make the budget cuts refused by the city—perhaps choosing to cut social programs for the poor, perhaps deciding that debt obligations to creditors rank ahead of people services.

As long as liberals and many New Yorkers assume that the answer to the $1 billion budget deficit lies in Washington or bank vaults, they shall lack the political will to balance their budget, as other local governments must. They will probably lack the ammunition to sell Washington and the rest of the country on the need for further assistance. They will lack the drive, and pressure, to reform the management of the government bureaucracy. They will, like Senator George McGovern, rail against the “undertones of racism” lurking beneath the populist tax revolt, ignoring the public’s legitimate anger at government waste.

Ironically, by railing against “racism” and villainous outsiders, those on the left often behave like “conservatives.” They come to protect their programs, their traditions, their record. To favor the status quo. To stress the pain and what’s already been accomplished, rather than what remains to be done. Some warn that attacks against government are aimed at democracy itself. In his book
The Limits of Legitimacy
, Alan Wolfe, a self-proclaimed Marxist, suggests, “The attack on government activity has become … a not particularly well disguised attack on democracy itself.” By this logic, the two-thirds of California voters who supported reduced property taxes in 1978 were not just anti-poor but antidemocratic. An act is democratic only if Mr. Wolfe agrees with it. Others warn that change must come gradually and not be disruptive. Echoing Robert McNamara, in late 1977 Mayor Beame declared he saw “light at the end of the tunnel.” Governor Carey and
the municipal unions stated similar views about “the progress” made. Symbolizing their status quo approach, most of the municipal unions endorsed Beame’s reelection bid. “The Mayor is the only candidate able to maintain a relationship with public employees,” said Barry Feinstein, head of Teamsters Local 237 and Treasurer of the Municipal Labor Committee. Teachers’ union president Albert Shanker also endorsed Beame, declaring he was “best equipped to continue to lead the city out of its fiscal crisis and toward economic and social health.” Jack Bigel, perhaps the single most powerful labor official because of his brains, lined up support for his friend Beame, as did John DeLury, chief of the sanitation union. One of the few major union holdouts was Victor Gotbaum—who called Beame “a disaster” but remained neutral.

In May 1976, when then MAC Treasurer Donna Shalala penned an Op-Ed page article for the
Daily News
suggesting the city would have to make further cuts and cease “business as usual” if it were to avoid bankruptcy, Bigel lashed back. “It is a call for confrontation,” he wrote on the same page, “confrontation between the city and its employees. But even worse, it is a call for confrontation between the city and all New Yorkers.” We must, cautioned the wealthy “conservative” who claims he is a socialist, “thwart the hotheads like Ms. Shalala, and avoid confrontation.…” These former allies of the underdog protested not a peep when the city, as required by a union-promoted state seniority law, laid off a disproportionate number of blacks, Hispanics and women. The United Federation of Teachers, in 1977, displayed full-page newspaper ads headlined
NEW YORK CITY’S PUBLIC SCHOOLS: THE UNTOLD STORY
. Taking negativists to task—“nattering nabobs of negativism”?—the union admonished, “But what the public doesn’t see or hear is the enormous
success
[emphasis in original] story of the New York City public schools.” It’s important to the union that parents not think otherwise. God, what if they demanded a better education for the $2,600 spent annually per pupil? Or fewer teachers’ prep periods, sick days, paid sabbaticals? What if citizens, who pay the freight, demanded performance standards for city employees?

Despite the evidence to the contrary, the left continues to treat most labor unions as if they remained the cutting edge of reform, a beleaguered rather than sometimes privileged class. It was easy to attack George Meany’s blatherings about communism or the war in Vietnam, but when it comes to many local issues people genuinely committed to reform adopt a conservative pose. When mayoral
candidate Bella Abzug strayed and tentatively questioned generous municipal pension benefits, Geoffrey Stokes wrote in the
Village Voice
that she was “union-baiting.” Ellen Willis, in
Rolling Stone
magazine, described the municipal unions—who are now the city’s primary bankers—as “powerless.” Before union leaders consented to withdraw a few of their fringe benefits in 1975, writer Nat Hentoff condemned Shalala and Councilman Robert F. Wagner, Jr., as “anti-labor” for suggesting such blasphemy. The same people who favor strengthened consumer protection and oppose monopolies, blindly support municipal labor monopolies against growing consumer demands to get what they pay for.

All of this has an Alice in Wonderland quality to it. By opposing more local “sacrifices,” the chances of bankruptcy grow, as do the odds that the real Huns will step in and demand the wrong kind of cuts or much deeper slashes in worker pay and benefits. If that happens, the nation’s foremost liberal city will flash to the rest of the country a message liberals want to avoid: liberalism doesn’t work. Some conservative colonialists will be granted license to speak of New York the way they do of “primitive” Africa. The liberal compact would break down as growing numbers of New Yorkers join other Americans in viewing not just liberalism, but government, as the enemy.

This may be the real danger—not that liberalism will be discredited but that government will be. Here, labels do matter. For while the old liberal or left litmus test issues—Vietnam, McCarthyism, domestic spying, unionism, dump LBJ, McGovern vs. Nixon—have receded, what tends to separate those on the left (loosely defined) from those on the right (also loosely defined) is a commitment to use government as an
effective
tool to help people. While many from my post–New Deal generation may reject the liberal label—preferring “progressive”—they would plead guilty to a bias in favor of the less fortunate, an emphasis on what remains to be done, a commitment to seek change; in a word, hope. Obviously, many who are called “conservatives” possess some or all of these qualities. And there are honest differences over the
means
to achieve these ends; people can be “left” on some issues and “right” on others.

But as the child of a working-class home, I know that while liberals may be bleeding hearts, at least they bleed. If you’ve ever covered or attended a national Republican convention, perhaps you know what I’m trying to say. These are the people who tend to
agree with neo-conservative cynics like Irving Kristol, who urges what he calls “benign neglect” for cities: “The cities are bottoming out. Leave them alone and they’ll recover.” That is the voice of a comfortable man. Similar voices opposed advances in civil rights and women’s rights, the antiwar struggle, tax reform, antitrust, consumerism. The status quo. “All great discoveries,” C. H. Parkhurst once said, “are made by men whose feelings ran ahead of their thinking.”

The challenge to progressives—both nationally and locally—is to think a little more clearly; to learn from, rather than embrace, past mistakes; to make government work. The Depression taught Americans the limitations of unfettered free enterprise and the more important role government could play in solving social problems. The New York crisis teaches the limitations of what government can do.

Perhaps New York’s experience will finally rob liberalism of its innocence. As was true for America in Vietnam, in New York liberalism has been identified with the wrong side.

T
HREE YEARS LATER
—after the bouts with bankruptcy, the layoffs, the service cuts, the new bookkeeping systems and the loud threats have been replaced by Big Apple lapel pins and congratulatory speeches—has anything changed?

Not really, laments Edward Costikyan, who was fleetingly a candidate for mayor in 1977. To make the point, he recalls a story his father used to tell about an Armenian sultan with a herd of healthy horses who captured a particularly clever horse thief. Without a moment’s pause, the sultan ordered immediate execution.

“No!” cried the thief. “Spare my life and I will teach your horses to fly.”

It was an offer the sultan could not refuse, and the thief was granted a year of freedom to perform his miracle.

“But you can’t teach horses to fly!” exclaimed a friend.

“Who knows?” responded the thief. “Maybe in a year I’ll be dead. Or maybe in a year the Sultan will die. Or maybe in a year the horses will die.” He paused, a smile creasing his face. “Or who knows? Maybe the horses really will fly.”

Observes Costikyan: “That is what the first three years of the fiscal crisis have been about. New York City has acted as if horses could fly.”

In New York’s case, the reprieve came from city and employee pension funds, the banks and the federal government. New York’s ritual
execution—bankruptcy—was postponed when the pension funds agreed to risk $3.8 billion of their assets and the Ford administration and Congress narrowly approved a three-year seasonal loan program in late 1975 to provide the city with annual infusions of $2.3 billion in cash it could not raise in the private credit market. The feds, like the sultan, consented to the reprieve after clever people like Governor Carey promised, “We will never need a bailout again, and we won’t come back for help; we are going to make it.” Three years later, in 1978, New York had not made it and was back before the Congress pleading for an extension of seasonal loans and for new federal loan guarantees. Horses still couldn’t fly.

Much—and little—changed in New York between 1975 and 1978. Political styles changed. In times past, mayoral candidates issued white papers and 14-point platforms, usually crafted by infants fresh from college. Most candidates vied to promise more services, reduce crime, maintain the subway fare, address the “causes” of unemployment, crime and drugs, eliminate business and landlord “ripoffs.” The answer to the city’s problems, it was commonly assumed, was more money. The critical question was which candidate promised the most new programs, which candidate was most compassionate—who was the most caring liberal, not the most realistic and competent.

All that seemed to change in 1977. Most candidates in that year’s mayoral contest acted as if they were aware of the new limits imposed on City Hall. They promised not purification from “the bosses” (as Wagner did in 1961), or Camelot (Lindsay in 1965), or peace and tranquillity (Beame in 1973), but further toil and sacrifice. One candidate, State Senator Roy Goodman, warned that the city’s attrition policy was insufficient and that further layoffs would be necessary. Manhattan Borough President Percy Sutton challenged the once-sacrosanct police union and promised 60,000 to 100,000 more auxiliary police volunteers. Builder Richard Ravitch predicted future deficits unless the city cut its budget and slashed its broad range of services. Costikyan vowed to abolish the City University’s graduate school. Secretary of State Mario Cuomo promised no-cost labor contracts, with any pay raises funded
through increased worker productivity. And the man who ultimately won the contest, Ed Koch, succeeded in part because he was perceived as the most specifically outspoken candidate, lashing out at union as well as business and landlord “ripoffs,” seemingly fearless in his condemnation of “poverticians” as well as politicians.