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|An Economically Beleaguered City
Posted 17th March 2009
In late February I watched an episode of the often inspired and explosively funny TV program, 30 Rock, in which the wildly erratic Tracy Jordan character (Tracy Morgan) - as a guest on the soporific Larry King Live, caused great alarm about the consequences of NY’s financial crisis. He insouciantly warns that the crisis will transform the buoyant, excessively materialistic “paradise” New York of the 2000s back into the crime-ridden urban hellhole of the 1970s.
Yes, Morgan was just doing a comic turn, but the fear that our daily environment will disintegrate around us as jobs disappear, home mortgages are foreclosed, and the value of one’s stock caves in, can’t be lightly dismissed. However, my instincts tell me that the city will not return to the 70s when social anomie, runaway crime, charred buildings, and nightmarish public squalor were the norm. Nevertheless, the flush times of mindless over-consumption are over, and the state of the city is going to develop into something that we can’t chart as yet. So, one chill drizzly day, I decide to spend a few hours getting a sense of the city’s changing mood and condition by walking down upscale Madison Avenue.
I begin by starting out from the crowded Beaux Arts building of the Neue Galerie where the intensely colored and emotionally expressive paintings of the early 20th century German artists who called themselves the Brücke (e.g., Ernest Kirchner) are on exhibit. From there I walk a block to Madison and 86th St, and walk down Madison to 79th St. These streets, though not without stylish stores like Dean and De Luca, Crawford Doyle Booksellers, Eli Zabar’s E.A.T, and L'Occitane en Provence, also contain neighborhood shoe repair and other convenience shops and a family-owned generic diner - The New Amity Restaurant & Coffee Shop. There are few stores for rent here, though I spy Apartment-for-Rent signs for the first time outside stately old buildings. But a little further south, Madison Avenue’s Gold Coast - 72nd Street to 57th Street - is pockmarked with vacancies (more than two dozen) as retailers flee the high rents. Of all retail categories, luxury stores that sell such items as leather bags, jewelry, and crystal goods have shown the greatest decline in sales in 2008, falling 7.5% from 2007. And today, the rents on Madison are dropping by as much as one-third, with many landlords offering more concessions than before, like additional months of free rent. One storeowner offered a positive take on it all. He felt Madison Avenue - before the collapse - had reached a crazy, unprofitable level, and “this may be a reality check.” He predicted the street will remain high-end, but will become an economically healthier place.
Of course, it’s not only Madison Avenue that’s hurting. Average office rents in Manhattan have suffered their biggest quarterly decline in at least 20 years. The Met Museum has begun to cut staff, and warns that it will probably have to cut its overall work force by 10%. And total jobs lost across the city may hit 243,000 by the end of next year. Given these figures, I wasn’t surprised to read that thousands of job seekers lined up in Times Square a few weeks ago, to be interviewed en masse by 92 employers, including those in the financial and health sectors, as well as education and sales.
People are frightened that a declining economy means increased crime, but murders after the first two months of 2008 are slightly down, and crime remains flat. A police historian, Thomas Reppetto, has stated that the city’s becoming less safe was not something that would occur quickly. But there is no denying the fact that Manhattan's reliance on financial institutions to support its economy makes it vulnerable to a more prolonged economic slowdown than the rest of the nation.
Yet I would prefer to be more sanguine about NY’s future than Tracy Jordan and other prophets of doom. So I discover an article in The Atlantic by Richard Florida, an urban theorist whose The Rise of the Creative Class argues that the U.S. economy is now based on the development and exchange of ideas, and that the best places for that to happen are cities like New York that attract and nurture creative, educated people.
His article argues that while New York may be diminished by the hard realities of the present, it will not be broken. Florida writes: “The financial crisis may ultimately help New York by reenergizing its creative economy. The extraordinary income gains of investment bankers, traders, and hedge-fund managers over the past two decades skewed the city's economy in some unhealthy ways.” He sees New York as much more than a financial center - rather as a home to a diverse economy drawing from a wide range of industries, from media to design to arts and entertainment. It is also home to high-tech companies like Bloomberg, and boasts a thriving Google outpost in its Chelsea neighborhood. For Florida those pockets of creativity provide hope that New York will regenerate itself into a less avaricious, less inequitable city.
Obviously for a New York-lover like myself, Florida’s vision of the city’s future is an idea that I am keen to embrace. I know hard times are upon us, but though I am wary of being quixotic, I believe a better city will evolve from the crisis.