New York City’s State of Permanent Crisis

New York City’s State of Permanent Crisis

New York City’s State of Permanent Crisis

How New Yorkers trying to ward off catastrophe paved the road to the privatized city.


Benjamin Holtzman’s new history of New York City, The Long Crisis, begins and ends with a pair of proclamations the city’s newspapers and magazines have long enjoyed making: declarations of crisis. Holtzman sets his scene in 1965, when the New York Herald Tribune asserted, “New York is the greatest city in the world, and everything is wrong with it.” He closes 25 years later with the launch of the Manhattan Institute’s City Journal, which promised “radical solutions to New York’s radical problems” (from a conservative think tank).

These pieces identified specific problems facing New York City in 1965 and 1990, some quite similar (the declining quality of public spaces, rising homicide rates) and some very different (the fate of social welfare programs and real estate investment). What unites them, in Holtzman’s telling, is the language of crisis. Across this quarter-century, he writes, New Yorkers from all walks of life believed their city did not simply have problems but rather was in a state of permanent crisis. As a consequence, these residents began to radically reimagine the very nature of urban governance, transforming the city’s politics, public spaces, and public life. The mayoral endpoints are striking: In 1965, New Yorkers elected the liberal, Herald Tribune–endorsed John Lindsay to address the city’s crises; 28 years later, they called on Rudy Giuliani, City Journal’s favorite radical revanchist, to do the same.

What happened? Holtzman is neither the first historian to ask this question nor the first to answer it by charting the path to neoliberalism, which he specifically defines as a process of marketization: the shifting of goods and services provided by the municipal state into private hands for private gain. Many scholars have chronicled this era in New York City, analyzing the city’s 1975 fiscal crisis, the rise of the real estate sector, and the mayoralty of Ed Koch (1977–89) to explain this dramatic shift. Their accounts have shown how politicians, bankers, real estate moguls, and other elite New Yorkers used and abused the city’s crises to construct the neoliberal city from the top down.

Holtzman builds on this work, but shifts our focus to ordinary New Yorkers, arguing that they shaped the process of privatization in significant, unheralded ways. “The neoliberal turn,” he argues, “rather than simply being imposed by a narrow set of elites, took form through a process of popular marketization that involved a wide range of urbanites who transformed the political economy from the ground up.”

In other words, innovations in privatization that are often ascribed to free-market ideologues and their corporate funders began not in boardrooms but at the grassroots. A decade before the 1980s “condo boom,” urban homesteaders inspired by the communal radicalism of the Black Panthers and Young Lords sought ownership of apartments in buildings abandoned by landlords. Years before the creation of the Central Park Conservancy, New Yorkers across the five boroughs organized massive volunteer efforts to clean up and re-landscape local public parks. Holtzman introduces a remarkable cast of everyday New Yorkers who “possessed little ideological allegiance to the superiority of market solutions” but tried anything and everything to make their homes and neighborhoods livable. Many did so precisely because they hoped to push the city to live up to its liberal promise—to reinvigorate, not undermine, the city’s vaunted system of public goods and social welfare. But nonetheless, “their messaging and actions,” Holtzman writes, “promoted the notions that the city itself was no longer able to solve the crises affecting its livable spaces.” As they took matters into their own hands, typically through forms of voluntarism, they “forged pathways for private actors and the private sector to become key players in major domains of urban life.”

In part, the story Holtzman tells is a story of co-optation, or what Fredric Jameson understood as late capitalism’s capacity to absorb and undermine countercultural expression. There are also shades of Stuart Hall’s observations on Thatcherism’s totalizing grasp in Holtzman’s analysis, particularly when he captures middle-class white New Yorkers transitioning from furious rental-conversion resisters to proud owners of new co-ops. Tenant organizers on the Upper East Side and in Parkchester initially thought they were fighting the imposition of a new real estate regime. As it turned out, they were negotiating the terms of their incorporation into that regime.

Holtzman himself spends little time theorizing. He is a social and political historian who has immersed himself in his archives, and each of his case studies is a gold mine of detail, packed with unexpected players, unintended consequences, and roads not taken. He focuses his study on “livable space”: housing and public places, with six chapters that cover low- and middle-income housing, parks, policing, development (primarily of luxury housing), and homelessness (in which the problems of housing and public space collapse into each other). Popular marketization, his main theoretical construct, is not one process but many, dependent on the interactions of ordinary New Yorkers with the municipal state and private interests at several junctures.

Take housing. Staggering levels of landlord abandonment gutted low-income, working-class neighborhoods in New York. By 1977, the City owned 35,000 occupied and 60,000 vacant units through tax delinquency, including half of the housing units on the Lower East Side. As the city’s usual mechanisms—auctioning properties or managing them temporarily—failed for lack of public and private funds, urban “homesteaders” took over buildings and poured sweat equity into them. The homesteaders emerged from the radical movements of the late 1960s, but, as Holtzman shows, they were easily incorporated into the emerging narrative of public failure and private action. Support for homesteaders, first from private philanthropy and then from city-sponsored programs, helped to legitimate these efforts, but they also stripped them of their radical potential, turning grassroots organizations into management companies and former tenant organizers into holders of lucrative owner-renovated units (whose resale, in the 1980s, helped supercharge the gentrification of the Lower East Side, in particular).

Fearing a different form of abandonment—white flight to the suburbs—landlords in middle-income areas began pitching co-op and condo conversions to tenants as an alternative form of homeownership in the early 1970s. They were met, as noted earlier, with intense resistance, so much so that tenants won new laws to limit landlords’ ability to profit off conversions. However, like many homesteaders, middle-income tenant organizers succumbed to success. Their resistance thoroughly sweetened the deal for tenants looking to buy, and by the 1980s, many did.

Even luxury development’s newest tools had popular origins. The J-51 program, which supported the rehabilitation and conversion of commercial buildings with 12 years’ worth of tax incentives, was reworked to regularize the “loft living” pioneered by artists in SoHo in the 1960s and 1970s. By the 1980s, the policy was heavily subsidizing luxury development and accelerating inequality. As Holtzman notes, New York’s crisis of publicly unhoused people coincided with not only with the closure of the state’s mental hospitals (from which 60,000 patients departed across two decades statewide) but also the loss of nearly 127,000 rooms at single-room occupancy hotels in the five boroughs in the same years. Nearly all of these SROs fell victim to J-51 conversions in the gentrifying areas of Manhattan and Brooklyn.

While Holtzman’s primary intervention is examining the neoliberal turn from the bottom up, the “long” in his title points to the importance of chronology in his analysis. Each chapter traces an arc that begins well before the shock of the 1975 fiscal crisis and follows ideas and inventions as they make their way from outsider activism to city-sponsored, privately funded policy. This slow process of absorption and transmogrification is best captured in Holtzman’s chapters on parks and policing. First came the volunteers, tidying local parks and walking seniors home in safety patrols. They consciously built on the War on Poverty’s promise of maximum feasible participation and struggles for community control by Black and Latinx New Yorkers. City administrators initially reacted with alarm—what if a volunteer gets hurt, or goes rogue?—but by the early to mid-1970s (when some parks saw 80 percent reductions in staffing), bureaucrats were so overwhelmed that they took all the help they could get.

Municipal support regularized and professionalized many forms of voluntarism, but some administrators dreamt bigger, courting corporate donations and private security forces to “save Central Park” and patrol Grand Central Station. However, elite businessmen balked at first. Why, after all, would private businesses spend their own money to provide what the city had promised? Big-donor public-private partnerships took off in earnest in the 1980s once City officials reframed them not as philanthropy or voluntary taxation but as investments in corporate amenities, from “front yards” (midtown parks) to clean streets.

It didn’t hurt that embracing privatization helped these elites to quash what remained of the New Deal vision. Holtzman catches Alton Marshall, then president of Rockefeller Center, snarling about “the old Roosevelt theory to let government do it” while crusading for private security forces for midtown. Some volunteers and administrators, at this point, began to object, wondering what they had wrought, but it was too late to change course. By the time Giuliani took office, Holtzman argues, the deeply unequal public-private renaissance that Rudy claimed for his own was well underway.

Holtzman’s is a fresh, lively account that adds new complexity and detail to the narrative of how New York emerged from austerity and bankruptcy in the 1970s to become a playground for the wealthy today. The book also raises fascinating and urgent questions about how, exactly, privatization shapes governance. As one of Holtzman’s actors observes, the decline of municipal revenue—the core crisis of the 1970s—does not track precisely with a decline in municipal power. Land use, and specifically the city’s power to issue tax abatements and zoning variances, is the example here, but the point holds more broadly. As such, it demands an accounting of what marketization actually does to state power. Sometimes the city did cede control to private actors: New York did sell off buildings it owned to homesteaders and developers, and it did hand over management of public parks to the Central Park Conservancy, the Bryant Park Restoration Corporation, and other organizations. With respect to policing, however, the proliferation of private security forces ultimately extended the power of the NYPD to surveil and control New Yorkers. While local cops initially looked askance at low-cost private guards, the professionalization of security services in the 1980s (largely through the hiring of off-duty and former police officers) generated cooperation to the point that many security guards now have direct access to police radio signals and precincts. More security guards than police officers roam New York City’s streets today, Holtzman tells us, but their presence has expanded, not diminished, the power of the carceral state.

Holtzman’s focus on “livable space” necessarily leaves some important popular forms of resistance to marketization just outside the frame. Municipal workers are mentioned only once, haplessly voicing a concern that volunteers will crowd out paid labor. Absent, too, are the Harlemites who fought the shuttering of Sydenham Hospital, the Brooklynites who occupied a firehouse in Williamsburg to protest its closure, and scores of other New Yorkers who challenged privatization head-on in these years. While some struggles were subsumed by the state, others collided with it (and shaped its evolution, too, albeit in more ragged and unpredictable ways).

To return to Holtzman’s title, what distinguishes the “long crisis” from any specific crisis in New York City is the way the idea of crisis became permanent, even hegemonic. Acute crises—even those as massive and disastrous as the 1975 fiscal crisis—could be addressed and fought over across the whole city. Living in a constant state of crisis, by contrast, takes the present failings of the municipal state and projects them into the future. Such an outlook, Holtzman demonstrates, does not generate solidarity, except of the most parochial kind. By the 1980s, without faith or hope for the city as a whole, many New Yorkers began carving it into something resembling the suburbs. Neighborhoods funded their own parks and quasi-police forces to secure to themselves a set of property rights that included the ability to segregate aggressively. As one Upper East Sider put it bluntly, “We get more protection this way. Our guards are beholden only to us.”

Holtzman’s account ends in 1990, but he writes in the conclusion that he hopes “tracing how cities have come to be so reliant on market solutions” will allow New Yorkers today to fight for more equitable and just cities. The phenomena whose origins are revealed in The Long Crisis are still features of the city, from unequally manicured parks to the private security patrolling shopping districts to homelessness, where, perhaps more than any other issue, the disjuncture between the market as metaphor and the market as governance is visible.

Mayors since Ed Koch have failed to “resolve homelessness” for the simple reason that they are unwilling to house New Yorkers who need housing. Instead, they have successfully painted the unhoused as mentally unwell and incapable of making rational decisions, and in so doing have transformed human beings in need into a problem of blighted public space in the public mind. Depicting unhoused people not in crisis but as a crisis justifies their forcible removal and incarceration, even though, as Holtzman makes clear, the decision to sleep on the subway—instead of in a 600-bed shelter rife with abuse—is entirely rational. This logic proves durable even at its most absurd: Consider a recent New York Times subhead, “For homeless people, a place to live is life changing to a degree that almost no other intervention can provide,” and imagine it rewritten for nearly any other problem (“For those rapidly losing blood, transfusions are life changing to a degree that almost no other intervention can provide”). Homelessness, in a state of permanent crisis, is evidence of urban decline and the need for more privatization, not a problem to be solved by using state power to guarantee a right to housing.

At one level, the path away from privatized municipal government seems straightforward: It leads back to the municipal state, to truly public spaces and goods that are administered by elected officials with adequate tax revenue to serve their constituents and political pressure at their backs to do so equitably. Rebuilding municipal government, though, requires not just recognizing the potential power of state action but also moving away from the generalized language of crisis to address specific crises. The volunteers who populate Holtzman’s early pages often sought more support and funding from the state to solve their specific local problems; they did not seek to supplant the municipal government writ large. Today’s very real, very expansive crisis—the Covid-19 pandemic—has generated a similar wave of voluntarism, but it has also made plain the dangers posed by an ineffective, heavily privatized government. Local action need not lead to neoliberalism—and if we are to emerge from this crisis ready for the next one, it must not.

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