Kim Phillips-Fein has an intriguing thesis about New York City’s 1970s near-bankruptcy and bailout by the state and federal governments. In her telling, the city’s response to the crisis—temporary budget cuts and business-friendly economic policies—helped remake New York, but at a cost: the city “would no longer . . . concern itself with social inequality” or “try to use its resources to aid the poor.” The city would also prove “far more ambivalent in . . . support for labor unions, for civil rights, for an activist government,” she writes. The problem with Phillips-Fein’s theme is that it’s wrong, as her own engaging, if uneven, reporting demonstrates.
A professor of history at NYU’s Gallatin School, Phillips-Fein presents a lively account of the fiscal crisis. Between 1965 and 1975, New York City more than doubled its annual budget to $10 billion. Mayors Robert F. Wagner Jr. and John Lindsay expanded public employment and boosted public-sector wages as well as government spending on welfare, education, and health care. The city’s leaders realized quickly, though, that they could not afford all this expenditure. Wagner forthrightly described his approach in 1965 as “borrow now, repay later” under what Phillips-Fein terms “a plan that barely hung together.” The city would spend more than it took in but look to tax hikes and economic growth to correct the imbalance.
Source: for MORE