The Fiscal Crisis Election
Will 2025 be another 1977?
To experience New York City in the fall of 2022 is to experience New York City, for the most part, as it was in 2019, before the COVID-19 pandemic killed tens of thousands of residents. Restaurants and clubs are packed. Museums are wide open. Masks, even on the subway, are mostly gone. If Midtown Manhattan still lags, perhaps permanently undone by the rise of remote work, some business corridors of the outer boroughs are thriving like never before. If the city appeared to be teetering on fiscal ruin in 2020, much-needed federal aid and a timely tax increase on the wealthy helped stave off disaster, easing a recovery that could have been much more challenging.
Dark clouds, however, still gather. A national recession, driven by rising interest rates meant to combat inflation, will inevitably impact New York, which sees a downturn in tax revenue if Wall Street isn’t booming. The end of federal aid means future budget gaps for the administration of Eric Adams. Business and personal income tax revenues are declining, as certain industries dependent on tourism and old Manhattan crowds fail to climb back from the ravages of the pandemic. The commercial office market is a wreck. The subways, buses, and commuter rails have recovered some of their ridership but are nowhere near their late 2010s highs; the state-run Metropolitan Transportation Authority, overly reliant on farebox revenue, will need to make tough choices in the years ahead if new funding streams aren’t found.
The term “fiscal crisis” must be used with caution because it invokes a very particular period, the 1970s, when New York City nearly went bankrupt. Today’s hardships still do not compare to what the city encountered then, when a collapsing middle-class tax base, rapid deindustrialization, and budget mismanagement led the city to the brink of insolvency. In 1975, the major banks of New York refused to lend the city more money, triggering devastating cuts to education, sanitation, policing, and social services that prolonged the city’s misery. The federal government’s bailout, overseen by the Ford and Carter administrations, was especially onerous, and the city’s generous postwar social safety net was gutted for good. All of this occurred against the backdrop of soaring crime. In 1975, 1,645 New Yorkers were murdered. In 2022, with less than three months to go until the end of the year, 327 people have been killed, a 13.5% decline from last year.
Yet New York, at this point at least, appears to be caught in a mini-1970s redux. Fiscal problems are being talked about again. Other kinds of crime—burglaries, grand larcenies, killings on the subway—are elevated, and the narrative that crime is completely out of control, if misleading, has taken hold in certain portions of the electorate. Unlike the 1970s, when cheap housing and SROs took in most of the indigent, homelessness is a 2020s crisis with no end in sight. None of this is the fault of a mayor who has been in office less than one year, but Adams must own these problems now. A more ambitious mayor would be proposing solutions or working towards them. Beyond crime, Adams seems mostly out of ideas, and he has taken little interest in governing America’s largest city. A think tank, the 5Boro Institute, recently started up with the explicit aim of motivating Adams to set policy goals of any kind, even if they are modest. “I’ve never seen anything or heard anything that spells out what his agenda is,” Dick Ravitch, who is helping to run the think tank, told the New York Times.
If the fiscal storm clouds gather more fiercely, could the 2025 mayoral race resemble the 1977 Democratic primary, which remains one of the most iconic and chaotic municipal races in New York history? Abe Beame, like Adams, was a ladder-climbing Brooklyn Democrat closely aligned with the outer borough Democratic machines. Adams took office at age 61, after eight years as Brooklyn borough president. Beame, who had run for mayor before and lost, was 68. Beame had been, for eight years, the city comptroller. Though he won the Democratic primary and general election comfortably, Beame was vulnerable once in office. Like Fiorello La Guardia, he was barely five feet tall, but he lacked all of the Little Flower’s charisma. He was soft-spoken and wooden, and the city’s brush with bankruptcy only weakened his hand further.
The 1977 race saw an unprecedented incumbent pile-on. There were no term limits then, so politicians who wanted a shot at City Hall had to wait out sitting mayors or take on those who seemed ripe for defeat. And Beame certainly was. Mario Cuomo, a Queens attorney famous already for mediating a dispute over the Lindsay administration’s plan to build public housing in Forest Hills, prepared to mount a serious bid. Bella Abzug was a trailblazing feminist former congresswoman who had nearly become a senator the year before. Abzug was celebrated enough that Andy Warhol was commissioned to paint her portrait for a Rolling Stone cover, and only Elvis Presley’s death in the summer of 1977 could knock her from the magazine. Herman Badillo, the first Puerto Rican to serve in Congress and as Bronx borough president, smelled blood in the water. And so did Percy Sutton, the Manhattan borough president and leader of the potent Harlem Democratic machine, which was the center of Black political power in America. Another congressman, a one-time reform liberal who sensed a reactionary law-and-order message would resonate with the electorate, decided to run too. His name, of course, was Ed Koch.
Would the political stars of today seek to do Adams in like they did in Beame? Perhaps.