Freakonomics Radio - How Does New York City Keep Reinventing Itself? (Bonus)

Episode Date: March 21, 2021

In a word: networks. Once it embraced information as its main currency, New York was able to climb out of a deep fiscal (and psychic) pit. Will that magic trick still work after Covid? In this installment of the Freakonomics Radio Book Club, guest host Kurt Andersen interviews Thomas Dyja, author of New York, New York, New York: Four Decades of Success, Excess and Transformation.

Hey there, it's Stephen Dubner, and this is a special bonus episode of the Freakonomics Radio Book Club. In case you are not familiar with the format, it works like this. We select a very good book. We interview the author at length, and rather than force the author to provide a slapdash summary of the book they've spent years writing, we have them read actual excerpts, hand-chosen for maximum effect. This episode features two people I happen to be exceedingly fond of, and I'm guessing you will be as well. Conducting the interview is Kurt Anderson,

the author of several very good books himself, most recently Evil Geniuses, The Unmaking of America, A Recent History. He also created and hosted the public radio show Studio 360. And before that, he co-founded and edited Spy, a magazine of satirical journalism that took aim at various blowhards, scoundrels, and terrible ideas. He also happens to have lived in New York City for the past few decades, and the past few decades of New York City is the very topic of the book we'll be hearing about today. The author is Thomas Dijda, and the book is called New York, New York, New York, Four Decades of Success, Excess, and Transformation. If you care even a little bit about New York City, and possibly even if you

don't, this book will enlighten and quite possibly thrill you. Here's Kurt Anderson. You know what log rolling is? In early America, a guy clearing land, cutting down trees, would get his neighbor to help him roll the logs away into a pile, and then sometime later the favor would be returned. Soon it became an all-purpose idiom for trading favors. So when I was one of the editors of Spy, we had a monthly column called Log Rolling in Our Time, where we'd track authors who had given blurbs praising each other's new books. And kids, this was way back before the internet, so it meant searching through physical bookstore shelves for hours,

practically as hard as clearing timber. Anyhow, I am hereby a log roller in my time because I blurbed the excellent book we're about to discuss, a book I'm also repeatedly quoted in, and I'm good pals with its author. My name's Thomas Dijam. But I can call you Tom. Yeah, absolutely.

It gets even more sordid. Tom's wife, Suzanne Gluck, is my agent, and Stephen Dubner's agent too, and Stephen Dubner worked for me when I ran New York Magazine. So, you don't need a cork board with post-its and red string and thumbtacks to see that it goes all the way to the top here at the Freakonomics Radio Book Club. But actually, this appearance of a conflict of interest makes perfect thematic sense, because today we're talking about a city made up of networks where money, friendship, politics, and art are all mushed together in tiny apartments that cost as much as big houses anywhere else. New York, New York, New York, four decades of success, excess, and transformation isn't your typical biography of a city. Tom leads us from the rough, tough 1970s through the rise of yuppies and yuppified,

glamorized outer boroughs, the birth of hip-hop and Bloomberg terminals, and the international super-luxury Manhattan of today. And as we wander those years in the city, he manages to keep us from getting lost or ripped off. Tom DiGio worked for decades in book publishing. And as an author, he's written big books like this one before. His most recent, The Third Coast, was about Chicago, his hometown. He has also published three novels and a biography of the complicated civil rights figure Walter White, whom you can no longer really Google because of Breaking Bad.

But even though I was a fan of Tom's writing before we were really friends, and I spent the decades he covers in New York City, I found myself constantly surprised reading this book. In addition to all kinds of juicy details, Tom provides a schema for how to understand the city's evolution or devolution, depending on your point of view. Here's an excerpt. New York's passage through Renaissance, Reformation, and reimagination was really a shift from mass society to networks. Until the 70s, political scientists described New York as a game played by all its interests, withough machines, the archdiocese, and even the mob, gradually gave way to one of individuals who defined themselves primarily by the networks they belonged to. The game board became what I imagine is a galaxy of eight and a half million lives

connected to each other in ways beyond counting. Those with the most connections, and therefore the most access to favors, advice, job tips, and string pulling, had shown the brightest. And the reconnection and reorganization of New Yorkers sent new tastes, ideas, resources, and behaviors coursing through every borough, unleashing financial, human, and social capital. Like a giant brain, the more connections, the more synapses firing, the higher functioning New York became. And so, here's my conversation with Thomas Dijuk, whom I expect to blur my next book very, very effusively. This is Freakonomics Radio, the podcast that explores the hidden side of everything

with today's guest host, Kurt Anderson. New York, New York, New York covers the terms of five New York City mayors, Ed Koch, David Dinkins, Rudy Giuliani, Michael Bloomberg, and the current one, Bill de Blasio. But in chronicling the huge changes over those decades, it focuses at least as much on the lesser-known men and women who worked to shape the city, at least their parts of it, to their respective visions. Your title is taken from something that a man called Holly White wrote. Explain who Holly White was and what he meant by this. Holly White wrote a book called The Organization Man,

which was one of the first sociological looks at the impact of corporate life and suburban life on American people. He was one of the leading edge of a counter-movement, which I would call Back to the City, which took place through the 50s and 60s. What he loved about cities was their purpose was to help people exchange. And the solution to fixing the falling apart New York of the 70s was to help people come back to the city. He was once asked, what are your three favorite American cities? And he said, New York, New York, New York. A favorite passage of mine was one that E.B. White wrote in 1949. And your title reminded me of it. He said,

there are three New Yorks, the people born here, the commuters, and something like the New York people who were born elsewhere and come to New York in quest of something who really give it passion. This book is about how a city changes, and there really are three evolutions of New York over this period. There is the Koch-Dinkins period, a kind of renaissance, and then a slip back down, there's the Giuliani era of reformation, and there's the Bloomberg era of reimagining what the city can be. And there really are three distinct, discrete cities. They each change in some profound ways that you'd still recognize the place, but in other ways, you don't. And so New York, New York, New York was also an echo of that kind of evolution. Like other cities, the New York government sold municipal bonds to investors to keep itself afloat.

But by 1975, it was too broke to redeem them. Thus began the fiscal crisis. President Gerald Ford famously refused to give federal help. The governor at the time, Hugh Carey, established something called the Emergency Financial Control Board, which was led by businessmen and business-savvy officials. And in exchange for bailing out the government financially, they began to dictate how City Hall spent its money. But one thing the public and private sectors seemed to have in common back then? They were both pretty shockingly disorganized. The city had lost control in the 70s not just because of debt, but because it couldn't effectively manage its information. Its budget was, said one expert, completely unauditable, which was the other reason the banks kept the city out of the credit market. Before New York could borrow again,

it had to catch up. Corporate America had its own tech problems, though, and for the big banks, the issue was the same as the city's. The sheer magnitude of data they produced outstripped their ability to handle it. At Walter Wriston's own Citibank, the back offices were so awash, they nearly lost UPS as a client when they couldn't produce a monthly statement. Chase had it even worse. David Rockefeller confessed that its poor performance in the mid-70s was the result of an almost total collapse of our operations management systems. After ignoring warnings from the head of IBM, Rockefeller blamed the city's inefficiency

on the Great Society, while his own bank fumbled with a back-office system one executive called garbage in, garbage out, and a backlog of garbage. I want to talk about these two key moments. One is 1975, you know, President Ford to New York City dropped dead. The place is in virtual municipal bankruptcy. Seven years later, a bull market on Wall Street starts. And moreover, this incredible booming of finance taking over so much of the economy, which love it or hate it, did benefit the city of New York.

Without a doubt, the person who is kind of the biggest player is Walter Riston. David Rockefeller was head of Chase and Riston was head of Citibank. By this point, Citibank had begun to replace tellers with city card machines. And there was this terrible blizzard in late January, early February of 78, when the city shuts down. And the banks close, and people are just stuck. And suddenly, people who had city cards were like, oh, I can just go in and get money out. Oh, this is pretty great. And immediately after that, Citibank gains a huge amount of clients, but also computers and bank cards become pretty standard. It's one of the first times that people really have anything to do with a computer, let alone trusting the computer with their money. sense of money flowing through everything comes from him. And the economy through those early

years is just wild, right? We're still getting over the oil crisis and interest rates was almost impossible to buy a new home. Getting credit was impossible. But what that did for New York was suddenly interest rates were flying up and down and yo-yoing. You could start to speculate on them again. And so you got into the beginning of this crazy bond market and introduced the idea of a speculative Wall Street. The stock market equities in itself was this sleepy place. Risks were not taken. Exactly. It was where your old uncle Ira had 5,000 shares of IBM or whatever, and the market

just explodes and never turns back. The money flies in and it becomes the Wild West. On May 19th, 1983, William Simon's company, Westray, took Gibson greeting cards public. They bought it for $80 million, $79 million of which they borrowed against its inflated assets. 18 months later, Gibson ended its first day of trading worth $290 million, and Simon's personal stake of $330,000 had sprouted like magic beans into $66 million, a return of 20,000%.

It was that easy, as spectacular and unreal as Reagan's Star Wars defense plan to shoot down Soviet missiles from spaceships, so would begin this cartoon age of garish society and paper profits of calling ketchup a vegetable. One thing Tom does especially well in this book is show how the city, not just the government, but people and neighborhoods and institutions, at their best, achieve a delicate Goldilocks balance of order and disorder, especially when it comes to public space. During Ed Koch's three terms as mayor from 1978 to 1990, New Yorkers

changed the way they thought of and used public space. But it didn't just happen on its own. That is where Holly White comes in, and that's where Gordon Davis comes in. He was parks commissioner under Koch, and Koch had gone through a couple dozen people who all turned down the parks job because the parks in New York in 1978 were just utterly terrible. Everyone told Gordon Davis to not take the job. He went up to a park in Inwood, northern Manhattan, and the garbage pails are all full and there's papers flying around. And there are these park employees just sitting there and asked the supervisor, what is going on here? Nobody's doing anything. And the guy kind of shrugs and he said, well, you know, we got this fiscal crisis

and nobody can do anything. And this was a Satori moment for Gordon Davis, who said people need to create a different attitude towards living in public space and participating. And if you remember, this is also the time of dog poop. You didn't have to pick it up. There was a huge wave when New York was incredibly dangerous where people went in this kind of crazy urge to get dogs. And so the dog population in New York really skyrocketed. And there was no law against just leaving on the street. So everyone did. And stepping in dog poop

was just a part of life. There was this ongoing battle in the late seventies about trying to pass laws to pick up dog poop. And the ASPCA and other dog owner organizations were really against the dog poop law because they said they're going to kill their dogs. They're going to let them free in the streets rather than pick up dog poop. Someone compared it to things that the Nazis did to the Jews by making them pick up poop. So finally, Franz Leichner was a state senator from New York City whose mother had actually died in the Holocaust, who I think took that rather personally, pushed through the pooper scooper law. It was the first questioning of public space as the place where you can do anything you want versus public space as a place where we all participate together.

Gordon Davis was very much a, how do we create public space that people share with other people? He was also involved in a couple of pathfinding ways towards things like privatization. The Central Park Zoo was a total mess. There was one seal floating around. The park couldn't get another one because it was unaccredited at this point. The animals were sick. It was like a jail for animals. And he worked on a deal with the New York Zoological Society to get some outside investment and create a different kind of governing body for the zoo, which ended up being part of the template for the reorganization of Bryant Park and the idea of creating a business investment district where the businesses around

would kick in money towards the rehabilitation. Bryant Park. It is one of those miraculous before and after stories. It was Needle Park, and it wasn't saved, just like Central Park wasn't redeemed and restored, just by sending the cops, get rid of the bad guys. Holly White brought in a guy named Dan Biederman, who got involved with Brian Park and threw himself into it with a kind of obsession. Dan Biederman was obsessed with making Brian Park work. He grabbed the Business Investment District idea and ran with that. And so Davis handed over that idea of Brian Park to him. A lot of people in this book make things happen because they are obsessed. Tom's goal was to understand and convey who these obsessives were and how they transformed the city. During the four decades the book covers, he tries to get past the simple binaries and buzzwords. These shifts from industry to information, from gritty and dangerous to exorbitant and, at least in Manhattan,

a little bit soulless. They weren't just good or bad. In so many cases, they were both. As in the original Tale of Two Cities, New York these last 40 years were the best of times and worst of times, an age of wisdom and foolishness, everything before us and nothing before us. A snap judgment or hot take really won't do. Everyone had their opinions about what had happened. Some saw only villains and victims, used terms like neoliberalism, quality of life, broken windows, and gentrification with little sense of their original meanings, context, or applications. Others told rose-colored stories about Giuliani's cops cleaning up Dodge and Bloomberg's enlightened reign,

ignoring the profound damage done to the city and its people. Either way, four complex decades were reduced to a morality play. I wanted to get down to the actual ideas, policies, and technologies behind it all. What was the process? Who were the people? So you moved here at 18 to go to college and never left. You were one of E.B. White's third kind of New Yorker. From Chicago, from the Northwest side, factory kind of working class neighborhood. But I got into Columbia, it was 1980. Morningside Heights was not a place where you wanted to ship your kid off to.

So let's just say the admissions rate was shockingly high at this point. You had been a New Yorker for more than 30 years when you started writing this book. Did you feel as though you knew New York well enough and now I could write this epic encyclopedic history of the last 40 years of it? For the first few decades, as I now speak in decades in my life, I think I still identified as one of those third groups of E.B. White. I still wore my Cubs hat and it helped that I married someone who was a native New Yorker that kind of brings you into the networks of the city in a much deeper way. But

psychologically and emotionally, I hadn't really owned the place yet. And after 9-11, my son was six or seven and a couple of tickets fell in our lap to game three of the World Series. And it was just this overwhelming experience with the jets flying over and people being wanded going in and this weird tension. So after the game, the Yankees won and I'm walking out and they play Frank Sinatra singing New York, New York. And there's 60,000 people singing at the top of their lungs. And I was just like weeping, you know, just thinking, all right, I live here. I am a part of this place.

Anyhow, to get back to the late 1970s, where Tom begins his book, Gordon Davis is cleaning up the parks and lots of regular citizens have read and become disciples of the Greenwich Village writer and urbanist Jane Jacobs. Holly White had heard her speak at Harvard and asked her to write a piece for Fortune magazine, which led to her 1961 book, The Death and Life of American Cities. It was a profound and persuasive rebuttal of the anti-urban urban renewal paradigm, which Robert Moses was executing with expressways and other car-centric new infrastructure. The Power Broker by Robert Caro, the book you see on a bookshelf behind every single cable news Zoom interviewee? That is the story of Robert Moses. For decades, if he wanted something built, it got built. And some of it was good. But in the 1960s, for the first time, there was serious pushback,

especially to his project, the harebrained Lower Manhattan Expressway, nicknamed Lomax, which would have required demolishing almost half of what was just starting to be called Soho. Soho was this desolate area. There were factories and warehouses, still some that were functional, many that were just empty. And the owners of these places were waiting for Lomax to happen. They were just waiting for their eminent domain check. And so when artists began coming in, they were fine. Like, okay, fine, squat here. It was extra money for them.

Temporarily. Exactly. The idea was for that to be temporarily. And so once Lomax was defeated, Soho suddenly had an identity and there was a permanence now to the place. And it became the art district of New York in a way that none had been before. But at the same time, a taste for a certain kind of living comes in. And it's not long before those lofts are being sold and the artists are being pushed out. And it's the beginning of that very familiar cycle of art as gentrifier. Wealth in New York does trickle down, but not in a rational, even shower of largesse. It travels through networks of who you know. Who's your hairdresser, your wallpaper guy, your dermatologist,

while leaving out those who aren't in networks. New York City was already a media capital, but you talk about networks. And in the 70s and 80s, how that change happened? That idea informed everything from crime to the art world to AIDS, which is really a crisis of networks. One of the things that changes is this wave of largely white people, middle class who are educated, come work in these businesses. They're called then yuppies. And they were the most incredibly

networked generation to ever hit a place. Similar schools, similar tastes, similar everything. And the kinds of tastes and desires that flow through that become generalized for the country. And the big one is money. It's actually noted by Felix Rowan, who was one of the country. And the big one is money. It's actually

noted by Felix Rowan, who was one of the important figures in the financial crisis in the 70s. He noted in the mid 80s that the city has now made business its interest. Business was part of what happened in New York, but it was not the thing that happened in New York. And that is a cultural switch that happens not just because there are these Wall Street firms that are making it happen, but because New Yorkers of a certain kind came and helped those tastes inform everything about what they did. In a meritocracy, your class is something active, made of your networks and your primacy in them. Where you worked mattered more than what you did. Where you went to school mattered more than what you learned,

because those places created ties. The density of young, largely white professionals pouring into New York meant all kinds of new weak ties connecting friends to friends of friends. A 26-year-old lawyer on the Upper East Side could have literally thousands more connections than some when their age in the Bronx. And through those connections came useful information. Job tips, stock tips, heads up on an apartment, a cute guy your sorority sister could fix you up with. Altogether, a mountain of social capital that made them an immense force. The problem was, they only liked to share with each other. Having been a quote-unquote yuppie at that time, I hadn't thought of the larger context in which you talk about that takeover, essentially, of New York, for better or worse. By the early 80s,

before the markets take off, there is a real sense of disillusionment, which was of losing the Vietnam War and Watergate and the oil crisis and the economy being down the toilet, stagflation. There was a sense of baby boomers being this first generation that was not going to do better than their parents. It's remarkable to think now, here are baby boomers responsible for every horrible thing that's ever happened and only cared about money. Part of what led that wave of yuppies coming in was a sense of, oh my God, here's my chance to make money. There was a kind of everyone swimming to the last lifeboat, and it turned out to not be the last lifeboat. It turned

out to be the future of everything. The bull got fatter. From 1984 to 1987, leveraged buyouts and other buybacks took more than $250 billion worth of stock out of the market, driving demand up further for what remained. Between July 1982 and July 1986, the Dow had doubled. Harper's editor Louis Lapham called money the sickness of the town. Even in the parochial, personal sense of you and publishing, me and magazines, it was around then, as though a switch flipped, suddenly news divisions and television networks couldn't just get by and break it even. They had to make as much money as any other part of the entertainment industry. Well, the word is blockbuster, right? Before a certain point, there had been this great ecosystem of small publishers and large publishers happily swimming along together through the literary world of New York. In the early mid-70s, there is a sense that computers are going to be the big thing.

And a lot of big conglomerates start to buy up publishers on the idea that they're going to need them for content. And so you have a lot of big conglomerates that own publishing houses, which used to be privately owned. And when they wanted to buy a big book, they would literally have to go to the bank and take out a loan to pay for this big advance. So it was a kind of self-regulating business. But now when you're owned by golf or some other huge conglomerate, the publisher just had to say, can we get this money? And the higher ups might say, yeah, okay, here's the money. But in return, they had to deliver. And this business starts to switch. Bookstores start to computerize. In the museum world,

by the late 70s, the idea of a blockbuster show, King Tut, things like that become really what drives museum culture in New York. More people are going to museums. More people were buying books. And there is a public good to that, but it created a cycle

that was much more financial and commercial. You had this miracle, which is the reduction in murder and other violent crime in New York City by 80 plus percent in 20 years. Right. Well, there were a whole series of reasons why this fever breaks. Everything from the people who were committing the crimes were also overwhelmingly the people who were suffering by them. And so the more it kept happening, the more that generation of largely, sadly, young men of color was destroyed. AIDS came along. Plus crack. And the networks of crime changed. And the idea of crack being something you used into something that you sold changed. And the circumstances were there for policing to be effective,

and they doubled down. But it seems when stop-and-frisk was ended that it could have been stopped a long time ago. We wouldn't have had another big uptick. The vision was that this was a kind of chemotherapy. You broke the back of it, and then you moved back towards a community policing paradigm as opposed to the constant profiling.

Crack is a businessman's drug, said Keith Haring, and New York was a businessman's city, bent on immediate gratification, where stock analysts hung on quarterly reports and yuppies indulged tightening cycles of desire with Sony devices, LaCruzay pots, and Mac computers that were obsolete after 18 months. The frenzy to have now and to have again was the nature of all modern life. As the price of cocaine dropped from $50,000 a kilo in 1980 to $35,000 in 1984, on its way down to $12,000, crack presented itself as a chance to escape for a few minutes, to make a few bucks, or maybe a fortune, which was, after all, our patriotic duty.

An interesting binary, non-binary thing was graffiti. It was a classic image of the breakdown of order. And yet, at the same time, graffiti artists were being discovered as fine artists and put in galleries. I feel like it's a dream that there were Keith Haring drawings in stations and on subway cars that I rode. And I remember as he was just getting big and famous, I think, wow, I could just tear that thing down and have a piece of Keith Haring art. Why didn't you do it? I don't know. I'm a good guy.

Because you're from Nebraska, and that just seems to go against everything you stand for. But it's one of the reasons why he stopped doing it, was that people really were just taking him in that way. Ubiquitous stylized graffiti, of course, arose simultaneously with hip-hop. And hip-hop, for my money, was the last genuinely new creation of American pop culture. I think it's New York's most important cultural contribution of the last half century. It is a global phenomena, and it started fundamentally from a rec room in the lower Bronx. And that moment with the Times Square show in 1980, when you have the Bronx people coming down and meeting East Village people. And for the first moment, those Afro-Atlantic arts that have defined what cool is in New York are suddenly recognized and

given place in the front. You have a phrase, the Warhol economy. Talk about that. Where I didn't name Elizabeth Currid came up with that. It describes the cultural economy that comes out through the 80s as the kind of Keith Haring, Basquiat, Madonna world begins to detach itself from downtown and become a much more commercialized mass market thing. It served seasonality really well when seasonality was something that fashion was still based on. And it was good for magazines because it was constantly refreshing. Here's what's cool now. And it created a cultural fountain. Many people drew from that for a long time. Speaking of Andy Warhol, who is... Not my hero. Well, yes, not your hero. And he was an epitome of a certain kind of cool.

And this, based on one meal I had with him, prick, but deeply cynical guy, yet was hugely creatively influential. You can draw the line from Andy Warhol to these hideous hundred and whatever story towers full of super rich semi residents along the southern edge of Central Park. In his own way, he loved those people and lived off those people and laughed at those people at the same time, which was its own kind of cynical deal. But I think more horrifying to me was the impact that he had on media and that whole 15 minutes of fame idea.

It introduced a kind of cynicism. I'm very Catholic with a small C about what I consider art, but I do think it needs to have a certain integrity. And I feel that in many cases he introduced lack of integrity to art. Warhol and Warholism at this period gave a kind of sheen and a ratification to caring about nothing but money and fame. When we talk about selfies and Instagram and influencers, if there's another Big Bang moment for it other than Warhol, I don't know,

but it sure seems like it starts there. There were plenty of rich people in New York in the old days, but this new class, this almost fourth kind of New Yorker in E.B. White's scheme of people who barely live here, this is just one of their homes of five or ten, that is one of the new things of the last few decades that I just, like, nah, there's nothing good about this. I can find nothing good about that either. We've done very well in not mentioning our former president,

but that is something that he had a role in helping to create, a world of condos. Part of the thing was to bring in this kind of international jet set who would largely not be able to get into co-ops, like the 740 parks of the world that were not interested in celebrities. They just wanted old wealth and social prestige. And bringing in Bianca Jagger and whoever else, these were not people that they wanted. And so Trump early on, one of his bases was to build luxury condos for these

kinds of people who wanted to live on New York, but to really not ever have anything to do with it. The city of our memories, that thrilling cesspool where anything could happen, site of secret rituals officiated by Santeria priests, home of dowagers on Beekman Place, refuge from everything straight and common, that city seemed to have slipped under a sea of gold. The rich were no longer rich, they were imperial. Chain stores devoured mom and pops, camp had been domesticated, rage, sex, and high art defanged, rents out of reach the NYPD and army. Depending on your mood, your age, your bank account, New York was now horrifying or wonderful. And even that changed day to day, moment to moment. We've danced around it, but after the break, we're going to dive into one of the big hot button issues in the past four decades in New York City, gentrification.

The folks who were there are happy to have better services, but they're also sort of pissed about it because they could have had them anyway. And what the city ought to focus on as it tries to recover from the pandemic. This is a moment for big ideas. It's a time to take some risks. More Tom Dija, Tom Dija, Tom Dija after this. I'm Kurt Anderson, and this is the Freakonomics Radio Book Club. Today I'm talking with Thomas Deidja about his new book, New York, New York, New York, Four Decades of Success, Excess, and Transformation. This book scrupulously avoids simplistic good-bad binaries. When it comes to the city's urban policies, one binary

conventional wisdom is that Robert Moses was bad and Jane Jacobs was good. More true than not, but not the whole truth. Scholars started to say not everything that Robert Moses did was bad. The racism and anti-urbanism that underlied a lot of what he did in basically creating ways to help whites leave the city, creating segregation de facto through the built environment of New York. There are other ways in which he did some really fabulous, fascinating, and important things. And now we're seeing ultimately a pushback against that kind of Jacobs vision of the city, against over-preservation. That's right. Jane Jacobs fought to preserve good old buildings and established organic neighborhoods rather than tearing them all down to build new everything. She fought for parks and

other pedestrian space over expressways. But her vision is also, for better and worse, what brought us gentrification. The West Village is beautiful, but try buying a place to live there. In 1989, priced out of Manhattan, my wife and I and our two babies moved to Brooklyn and accidentally helped make our cheap old-school neighborhood unaffordable for other people. This suddenly regenerating Upper West Side, according to New York Magazine, without doubt one of the most striking examples of urban revitalization and recent memory, vindicated Jane Jacobs at least as much as anything about the West Village. Rather than government plans, a few smaller, directed changes had let the market do the work.

If Soho was an act of repurposing the city's industrial history, the Upper West Side offered a return to upper-middle-class domesticity with a diversity not found on the East Side. The problems that arose over the next 15 years spoke directly to some drawbacks in Jacobs' thinking. The new building and conversions meant displacement. Brownstones went from multi-unit apartments into single-family homes. SROs went co-op. And some early J51 buildings aged out of their abatements, allowing the landlords to jack up rents. A culture clash became palpable in schools and playgrounds, in the buildings filling up with professionals. Rather than restoring networks or adding new

connections, lifestyle usually superimposed new networks onto the old neighborhood. Fresh, yuppie arrivals wanted things the way they wanted them. So positive involvement in parks and public schools often became battles for control in a neighborhood that already had a powerful tradition of activism. On the other hand, sincere attempts by newcomers to enter existing networks were often rebuffed, with locals pulling into their own tighter, self-defeating ones. To me, maybe the great example of there's good things about it and there's bad things about it is what we call gentrification. Talk to me about that, because it continued crime reduction as

part of its virtuous cycle. When crime took off again in the later Koch-Dinkins years, it doesn't stop the next wave of crime from happening, but it does bring benefits. And that's part of the anger of it. The sense is that the only reason why a place is better policed and the services magically get better is because now there's white people there. And good grocery stores. There's a kind of sad resignation that the folks who were happy to have better services, but they're also sort of pissed because they could have had them anyway. We do have to be realistic about the fact that neighborhoods change, that people move. It's natural that you have waves of people coming and going.

What's unnatural about gentrification is that the price structure freezes people in place. If your son leaves, his ability to find an apartment that is what your rent-controlled apartment is, is nearly impossible. So it breaks up those neighborhoods not by aggressiveness as much as by this melting away in the face of the money that comes in. In 1999, rents were up 50 to 60 percent over the last five years, while owners doubled their money in two. You almost had to buy now if you wanted to stay in the city. One sensitive broker worried that the normal people, making half a million dollars a year, they won't be able to afford to live here and put two kids in private school. Networks of wealth and social capital bound more tightly than ever. Co-ops exacted onerous financial requirements. Three, five, even ten times the purchase price held in assets and years of maintenance and escrow no

longer uncommon. In once shaggy places like the Upper West Side and the East Village, community was defined in terms of property value, and community boards and block associations fought homeless shelters and zoning changes. Brooklyn was no longer just attractive, it was a necessity. Rents had tripled in five years in Williamsburg, established turf like Park Slope was up almost 20 percent, and New York Magazine compared Carroll Gardens' quote, funky bustle, to the West Village in the 60s. New York City is supposed to be the bastion of liberalism in America, but look at the mayors in the period covered in this book. You have a conservative Democrat in Koch,

you have a Republican with Giuliani, You have a Republican with Giuliani. You have a Republican independent in Bloomberg. Everybody but David Dinkins. Koch, Giuliani, and Bloomberg were all people who had been in different parties. But Giuliani worked for Kennedy as a boy who had started as a Democrat and went increasingly right as it was more opportune for him. But as he first ran, he ran as this kind of fusion Republican. There was a window for that kind of Republicanism again. And it was not impossible in New York for these people of a certain age to

remember that Nelson Rockefeller literally came up with ways to almost print money for the state in a way that a Republican today, their heads would explode. Tom writes about 9-11, many would say afterwards that this was the day that New York lost its innocence. In fact, it was the day the city regained it, at least for a while. He's right. Firefighters and cops rushed to the scene and everyone on sidewalks and on subways looked at each other differently, more as fellow citizens. Rudy Giuliani's level-headed, empathetic response, yes, that Rudy Giuliani, made him widely admired. And then, on the first day of 2002, Michael Bloomberg, a man who'd become a billionaire on information and the Wall Street boom, began his three terms as mayor, reimagining the city as more sensible and efficient and,

more than ever, as a kind of global hub of the upscale. The synthesis of style, art, money, and politics that legendary Vogue editor Dionne of Reiland had aspired to had fully coalesced under Bloomberg. Manhattan was no longer more like the rest of America. It had fulfilled New York Magazine's 1980 prophecy and become Shanghai in 1937, an international settlement and paradise for the wealthy. Reimagined New York was delivering on its promise of an enlightened lifestyle. Its residents were living nine months longer than the average American. Some of that came from the crime drop. There'd been a gain of 6.2 years since 1990, but in general, everyone's blood pressure had dropped. Smoking was falling twice as fast as it

was in the rest of the country, and now the Board of Health required calorie listings in restaurants. Carts selling fresh produce were placed in low-income areas. New Yorkers walked more and walked faster. And there was even evidence that simply living in New York City was healthy. As New York Magazine reported on the social and economic density that has life-giving properties, networks right now were only good. Density creates networks, and belonging to networks correlates with better health and a longer life.

Those who weren't as networked, the homeless, the elderly, single mothers, and unskilled immigrants, slipped increasingly out of sight. And the punchline is that after these, well, Democrats, Republicans, fusion, centrists, whatever, for 30 years, you have de Blasio, who ran as Mr. Left, finally. I remember having arguments with Upper East Side friends of mine saying, no, he'll be great. We need this. And then he turns out to be just a nincompoop that nobody likes.

Right. Well, I mean, Bloomberg, who was a registered Republican, in the middle of his term becomes an independent, and a vast number of people in his administration were Democrats. And the thing that he always shared with Republicans was that love of the financial markets and his inability after the financial crisis in 2008 to step away from that world. But his sense of public service, at least in a philosophical way, was very old school liberal and trying to make the city a better place and not just send money out to rich people in the suburb. There's much to admire about what he did along with the terrors of stop and frisk and what he did when he ignored people who

didn't look like him or didn't travel in his circle. So that's a very mixed bag, but de Blasio, I throw up my hands. As the galas got shiny again, food stamp use in the city shot up, doubling in the years after the financial crisis. The percentage of New Yorkers below the poverty line remained around 20%, with another 20% highly vulnerable. There were almost 50,000 people sleeping on the streets any given night. Suckered by the one-two punch of the prosperity gospel and greedy banks, Jamaica Queens had the highest number of fraudulent home loans and foreclosures in the city, and only one development out of the 5,176 predicted

during its rezoning. Billions in minority capital disappeared, while community groups that once helped people buy homes now tried to save them. White capital and the next wave of gentrification stood ready to take advantage. Even the Yankees piled on. If stadiums were cathedrals of baseball, they'd use their deal with the city to build the Vatican, a vaulted palace in the Bronx that charged $2,625 for a seat behind home plate. All but the richest felt powerless somehow, suckered by the luxury city. You write a lot about commercial real estate and its role in what has happened in New York the last 40, 50 years. And I think, for instance, of 9-11 and afterwards, oh my God, what's going to happen to the financial district? Well, a lot of it turned into apartments. But people also said

nobody's ever going to work in a skyscraper again. There was that magical period, but there was also a contrasense of, oh my God, the city will never recover. And in a certain way, we had that in 2008 again, where it seemed this is the worst it's ever going to get. And in a matter of a couple of years, it healed. New York is an incredibly resilient place. And I thank goodness with the administration that we have, I think we're going to be able to get the kind of financial support and a little bit of the balance of payments that the city makes to be evened out, hopefully. But this city can bring itself back. Rockefeller used to talk about catalytic bigness.

David Rockefeller. Right. And it was big urban renewal, big developments. And we do need that kind of bigness, but not in that kind of development. This is a moment for big ideas. It's a time to take some risks. The biggest risk it could take is to spend some of that money on maintenance, fix the subways, fix basic services, and the city will take care of itself. And that seems to be, oddly enough, a big idea. As we've seen, this city is a vast network of connections that works much like a brain.

When people exchanged ideas, actions, and money with each other, the smarter, cleaner, greener, safer, and more creative it became. Yet the last four decades also left the people of New York fragmented, with too many of them farther away from real power than they have ever been. At the same time, too many others became passive consumers of urban life. I want to talk about the future and what happens when we are all vaccinated. And I want to lead by talking about another famous quote that I love, which is from John Updike, who only lived here briefly. He said, the true New Yorker secretly believes that people living anywhere else have

to be, in some sense, kidding. It reminds one of how important to New York City and this three-part regeneration, reformation, reimagination that you talk about is just the sheer hubris, civic narcissism of New York, right? You know, that's very true. My last book was about how Chicago had a whole parallel aesthetic that was really the crucible for a lot of things that then went off to New York and became famous. So I think I've always brought a certain kind of gimlet eye on New York's claims of primacy. A lot of it is self-promotion. And when you dig a little bit below the surface,

you see that, yeah, there's a lot of flummery here. For a few months, I thought, eh, civilizations crumble, cities end, all that. But I'm actually feeling fairly hopeful and certainly full of eagerness, not return to normal, but to go to the theater and restaurants. I can't wait to go sit down inside of a restaurant and have a drink and just hear that, like,

tinkling of silverware and people talking and go to a movie and wait in line and get popcorn. The pent-up demand to do things in this city is going to be immense. go to a movie and wait in line and get popcorn. The pent-up demand to do things in the city is going to be immense. I think the awful retail situation we have, the streetscapes are a real serious problem. They have a lot to do with how we shop now. I do look at these boarded-up buildings and say, this is going to be great for somebody because I look back and you think about Soho and Chelsea and other parts throughout the city that were once places where you or I would not have gone unless it was 2 a.m. on Saturday night.

But now those places have Sephoras in them. And I'm not saying that's great, but I'm saying that they didn't die. And if there's one lesson to be taken from all this is that we learn to be able to look at the city and say, okay, we have this great ability now to look at data, to measure things. That's all we care about, right? Once in a while, we need to look at the changes that we put into place and the policies and keep taking their temperature. So to hopefully avoid creating new problems by saying this is the new permanent way we do things, we need to say, let's try this and let's see how this goes. And then ask ourselves every few years, did that work? How's that going?

That was Thomas Dyja, D-Y-J-A, the author of New York, New York, New York, in conversation with Kurt Anderson. Thanks so much to both of them. And thanks to you for listening. We also made an episode with Tom Dija back in 2013 about his book on Chicago, The Third Coast. That episode is called The Middle of Everywhere. It is number 136 in our archive, and I'm happy to say that our entire archive

is now available in any podcast app. We will be back very soon with a regular Freakonomics Radio episode. Until then, take care of yourself, and if you can, someone else too. Freakonomics Radio episode. Until then, take care of yourself and, if you can, someone else, too. Freakonomics Radio is produced by Stitcher and Renbud Radio. We can be reached at radio at Freakonomics.com. This episode was produced by Brent Katz.

Our staff also includes Allison Craiglow, Mark McCluskey, Greg Rippin, Zach Lipinski, Mary DeDuke, Matt Hickey, and Emma Terrell. We had help this week from Jasmine Klinger. Our theme song is Mr. Fortune by the Hitchhikers. The other music was composed by Luis Guerra, with additional music this week by Michael Riola and Stephen Ulrich. If you would like to read a transcript or show notes, go to Freakonomics.com.

And fade out. And bring up Manhattan or New York, New York. The Freakonomics Radio Network. Stitcher.