Fear City: New York's Fiscal Crisis and the Rise of Austerity Politics by Kim Phillips-Fein

Abstract

Reviewed by: Fear City: New York's Fiscal Crisis and the Rise of Austerity Politics by Kim Phillips-Fein Brian D. Goldstein (bio) Fear City: New York's Fiscal Crisis and the Rise of Austerity Politics. By Kim Phillips-Fein. (New York: Metropolitan Books, 2017. Pp. 416. $32.00 cloth; $22.00 paper; $9.99 ebook) In Fear City: New York's Fiscal Crisis and the Rise of Austerity Politics, Kim Phillips-Fein opens the lid on one of the iconic moments in the postwar history of the American city: New York City's near default in 1975. The city approached bankruptcy as a series of massive debt obligations came due. President Gerald Ford, quite famously, refused to provide the funding that the city needed, a moment encapsulated in the famous New York Daily News headline of October 1975: "Ford to City: Drop Dead." As the common story goes, the city borrowed profligately for decades to fund social programs it could not afford, bankruptcy was not an option, and restructuring the city in the aftermath was inevitable. New York had no choice but to slash its famed social safety net, which included free college tuition, neighborhood hospitals, and affordable subway fares. It could not have been any other way. [End Page 648] Yet the great contribution of Phillips-Fein's book is to argue that, in fact, none of the history as it unfolded was inevitable. Austerity, she writes, was "a political choice" (p. 10). And the path to austerity was never black and white. The city borrowed extensively, sometimes using problematic accounting measures, but banks played their part by buying debt eagerly. Ford put his foot down in refusing to provide financial aid during the most fraught months of the crisis not just to teach a financial lesson, but also because he saw an opportunity to impose a free market political ideology that would burnish his conservative credentials. And experts—those who guided harsh cuts through new entities like the Municipal Assistance Corporation and the Emergency Financial Control Board—were not objective technocrats. They were frequently members of the city's banking and business elite, unelected, and eager to ensure that financial institutions received the money they were owed before social obligations were met. As bankruptcy approached, those who stood to profit from it ideologically or financially used it to create crisis conditions. These, in turn, became justification for a fundamental restructuring of the supportive role the city had played for its citizens. "Over time," Phillips-Fein writes, "the fear of bankruptcy took on a life of its own" (p. 67). This context meant that other approaches—like declaring bankruptcy and making more balanced and equitable cuts—became seemingly impossible, though in fact they never were. In explaining this, Phillips-Fein gives dimension to actors often flattened in accounts of the crisis, showing that figures like Mayor Abraham Beame and President Ford often had choices. Everyday New Yorkers, those most affected on a daily basis by cuts to schools, police, garbage pickup, health care, and fire stations, did not roll over in the face of austerity. Rather, they actively pushed back against a city that shifted away from its ambition to lift up the middle and working classes. Such efforts—Adam Veneski and the People's Firehouse, student and faculty efforts to save Hostos Community College of the City University of New York—are some of the most compelling in the book. Even more such stories would have been welcome, for they provide clear evidence of [End Page 649] the multiple visions at play in this history. Yet the lack of equal representation of such voices is surely evidence of the degree to which elites dominated in determining what sacrifices would be made. Though a New York story, the way in which these events unfolded had national and even international reverberations, as Phillips-Fein argues. New York City emerged a different city after this but so did cities in general. The generosity of America's biggest metropolis came to be cast as irresponsible, making it less likely that other urban centers would follow in its path. Instead, a new vision of the role of municipal government took hold, one...