How disasters have shaped New York City
After six years of relative prosperity, New York Mayor Bill de Blasio is immersed in his first major crisis.
How he deals with the unprecedented effects of the worldwide COVID-19 pandemic on his city will shape his legacy after he leaves office at the end of next year due to term limits.
“There is no greater test of a mayor than a financial crisis,” said Andrew Rein, president of the watchdog Citizens Budget Commission.
The city that never sleeps is essentially shut down, with businesses closed, medical and financial resources strained to the max and the city finances reeling from lost sales and income tax revenue.
De Blasio, in his $85.3 billion executive budget presentation on Thursday, projected $7.4 billion in lost revenue from a range of taxes through the next fiscal year. Others mapped out worse numbers, including the watchdog Independent Budget Office, which pegged the hit at nearly $10 billion.
While the pandemic is one of its kind, the city is no stranger to catastrophe.
How New York has responded to disasters provides a greater understanding of the city’s history, according to Mitchell Moss.
“Most scholars, when they talk about New York, will look at it as a city created by great leaders such as [Fiorello] LaGuardia or perhaps Robert Moses,” said Moss, a longtime urban-affairs guru and director of New York University’s Rudin Center.
“I think that disasters have done more to shape New York City over the past 400 years than any one individual, for sure.”
While the Sept. 11, 2001, terrorist attacks, Hurricane Sandy and the Great Recession of the late 2000s evoke recent memory. Moss said earlier disasters, both domestic and abroad, had pronounced effects on the city and region.
They include fires, blizzards, waves of Irish and German immigrants due to the potato famine and social unrest, and the previous flu epidemic, in 1918.
“Disasters don’t just affect New York once and then go away,” Moss said during a web seminar. “They become part of the city because the city has aggressively responded by taking the initiative to correct the problems that led to them.
“That meant a water supply to fight cholera, that meant subways despite vulnerability to snow, and I think, more important, the building code — every time we’ve a physical disaster — has been rebuilt and redesigned, so the great part is that our buildings are very safe compared with other cities.”
The Great Fire of 1835, for example, triggered a reconfiguring of streets, and underscored the need for a centralized water supply system after the drinking of well water en masse caused three cholera epidemics. Many insurance companies decided not to rebuild and moved to Hartford, Connecticut.
The Great Blizzard of 1899, which shut off surface movement, had leaders thinking about travel alternatives. “This led New York to realize that it needed a subway system underground,” said Moss, prompting the construction of the north-south Lexington Avenue line, which in turn made Brooklyn a growth center.
Today, that corridor, which carries the Nos. 4, 5 and 6 subway lines, has more daily riders than the entire systems of San Francisco, Chicago and Boston, according to Philip Plotch, author of the new book “Last Subway: The Long Wait for the Next Train in New York City.”
The earlier flu epidemic prompted staggered work hours.
Sept. 11, Moss said, changed New York’s relationship to the country and the world. It also triggered a rebuilding and rebranding of Lower Manhattan. “The city became part of the nation rather than an outlier with unusual and progressive people.”
New York also diversified its economy after the Great Recession eight years later. “The city realized at that time that it could no longer be just a financial center,” Moss added. “It was important, but no longer core of our economic rationale.”
Under Mayor Michael Bloomberg, the city built out what Moss called its “intellectual infrastructure,” adding a Cornell Tech campus on Roosevelt Island, new tech startups along the Brooklyn Navy Yard, and converting an old Metropolitan Transportation Authority building in downtown Brooklyn into an NYU engineering facility.
Likewise, Hurricane Sandy, which struck on Oct. 29, 2012, raised awareness about exposure to climate change.
Moss envisions a buildup in biotechnology and healthcare as the city recovers.
“I would take either the Brooklyn Navy Yard or the property we would have given to Amazon and put it into biomedical research,” he said. “Let that be a magnet for the world to know that we’re going to invest in this.
“There’s going to be a massive growth of the biotechnical world just as there was a massive growth after Sputnik. When the Russians went up to satellite, we invested in science technology. We’re on the verge of a new investment in healthcare, especially bioengineering. If I were the governor, I would not waste a dime on Amazon, but I would put billions into biotechnical research.”
The state and city late in 2018 struck a deal for Amazon to establish a co-headquarters in Long Island City, Queens, but the retail behemoth pulled out three months later, citing political headwinds. Amazon instead signed a lease for a smaller operation in Manhattan’s Hudson Yards development.
“The nature of work is changing,” Moss added. “Technology has now shown that you can have financial institutions doing trading from home. I’m very concerned about how the future office market is going to work. People are going to want to go to offices for the structure, for the interaction, but they’re not going to work in 40-foot cubicles with the open air.”
The landscape will also change nationally, said Robert Labes, a partner with law firm Squire Patton Boggs.
“There could be a new normal in a lot of areas that will be relevant to public finance, things like airline travel, mass transit, convention center bonds. This pandemic could result in a more online world even after it ends. In-person bond closings were the norm. Now they are the exception, and they will become even less common.”
When New York reopens is largely out of de Blasio’s hands. In what observers see as filling a leadership void at the federal level, a coalition of seven Northeast governors, including New York’s Andrew Cuomo, is collaborating on measures such as the loosening of public-gathering restrictions.
The newfound regionalism is more a marriage of convenience, Moss said.
“At the core, I think will be some regional cooperation but I would not overrate it. I think we have kind of a lull because they all want the same thing, which is money from Washington.”
Nicole Gelinas, a senior fellow with the Manhattan Institute for Policy Research, noted the multiple crises de Blasio’s six immediate predecessors either inherited or faced while in office. De Blasio, by contrast, has overseen a city during better times, which enabled him to drive up spending by about 30% while in office.
John Lindsay, David Dinkins and Rudolph Giuliani wrestled with crime and social unrest; Abe Beame and Ed Koch faced the 1970s financial implosion and its aftermath, respectively; and Michael Bloomberg took office four months after the Twin Towers fell.
“If you think about it, what has the mayor accomplished other than pre-K?” Gelinas said. “That was perfectly fine, but his imprint up to now has been pre-K, which was not that difficult to roll out.”
Post-pandemic, Gelinas said, Congress should fund state sales-tax holidays through the end of the year to jump-start retail and restaurant reopenings. To that end, she added, the city should eliminate its tax on commercial rent.
Lingering coronavirus fears are worrisome, Gelinas added. That especially applies to the state-run Metropolitan Transportation Authority, which operates the city’s subways, buses, two commuter rail lines and several interborough bridges and tunnels.
The MTA, which has had multiple bond-rating downgrades during the pandemic, asked the federal government Thursday for another $4 billion to match what Washington earmarked last month.
“I do worry [about] when people start coming back to New York City,” Gelinas said. “If they see subways that are more crowded, dirtier, running less frequently, and they’re also worried about the still-uncertain public health impact. Does coronavirus go away in the summer, does it come back in the fall?”
The MTA, one of the largest municipal issuers with $45 billion in debt, has seen a 95% ridership drop and pur on hold its five-year, $51.5 billion capital program.
Lisa Daglian, executive director of the advocacy group Permanent Citizens Advisory to the MTA, warned that dire cuts and increased crowding could hinder COVID-19 recovery efforts and could return New York to the "bad old days of disinvestment, decay and delay."
“I don’t think the doomsday scenario is that doomy, because there's an understanding in New York that we need the transit system, and it’s surprising, even in this coronavirus, that we still need that subway system just to get the essential workers moving,” said Plotch, a professor and director of the master of public administration program at St. Peter’s University in Jersey City, New Jersey.
He is also a former director of World Trade Center redevelopment and special projects at the Lower Manhattan Development Corp. and a former MTA manager of planning and policy.
“The subway system has been around since 1904, so it’s overcome two world wars and a Great Depression,” Plotch said during a virtual book launch sponsored by the civic organization TransitCenter.
“There was a middle-class flight in the 1950s and highway construction, which took people off mass transit. The subways went from a private operator to the city operating it to a transit authority to the MTA. And we went through 9/11, which was the most tumultuous time for me because I was fearful of riding the subway.
“So I am optimistic that we will overcome this one also, as long as we pay attention to the problem. It’s when you don’t talk about things, when you ignore things, that’s when you have the biggest problem.”