A recent blog post by investor and stand-up comedian James Altucher (mentioned here) arguing that New York is dead forever attracted the hostility of many New Yorkers. Fellow comedian Jerry Seinfeld wrote a New York Times op-ed calling Altucher a “whimpering putz.” Mayor De Blasio, naturally, agrees with Seinfeld.
The New York Post told Altucher to “drop dead,” noting that, if he really loved the city as he claims (he co-owns a comedy club there), he would stay and do his part to revive it. Guardian columnist Arwa Mahdawi suggests that New York is not only not dying, “the rich are moving out and the city is being reborn.”
With all due respect to these people, they missed Altucher’s point. New York as a city will survive. But New York as an ideal, a place that builds wealth and fulfills dreams like nowhere else in America, will not. Not to put too many words in Altucher’s mouth, what is really dead is the idea that New York City or Manhattan densities are necessary have a healthy economy and diverse culture.
Altucher pointed out that the pandemic has taught high-income people that they don’t need to deal with the congestion, high costs of living, homeless people, crime, and other stresses of the densest city in America. The things that made New York attractive are disappearing: lots of restaurants are permanently closed; lots of entertainment businesses promise to reopen next year, but no one knows if they will.
Mahdawi and others may be smugly happy to see rich people leave, which she hopes will make the city more affordable. But those rich people provide the start-up capital and the initial demand for all of the businesses that made New York City exciting.
The key to any thriving economy is exports, and what New York City exported was money. If the owners of that money decide they don’t have to be in New York City to export it, then the city loses the biggest driver of its economy.
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New York City’s construction costs have been the highest in the world. The people who paid those costs to build housing aren’t going to accept 25 percent or less of what they were expecting for the condos and apartments they have built. Instead, they’ll figure out other uses for that space and it won’t be available as housing.
A few weeks ago, I participated in a debate with market urbanist Scott Beyer over housing and land-use regulation, and Beyer’s main argument was that density has a value to businesses and personal interactions. It is quite likely that the COVID-19 virus has reduced that value to less than its cost.
Richard Florida got famous telling cities that what he called the “creative class,” the people who build wealth, were attracted to density. He still thinks they will return after the pandemic is over. But there is a very real chance that they won’t, and the longer the pandemic lasts the greater that chance will be.
After all, they will realize, even if someone finds a cure or vaccine for the virus, there will be something after that and something else after that. If they can conduct their businesses living and working in lower densities — and judging from the current state of the stock market they can — then many will not feel the need to return.
The next time you fly into Newark, La Guardia, or JFK, there will still be skyscrapers across the Hudson or East river. If you want to watch a baseball game, the Yankees and the Mets will still be playing. But will New York still be the world’s wealthiest city, with more millionaires than any other city in the world? Possibly not. And the exodus of the wealthy is just a symptom of the city’s real problem, which is that the people who once made it great no longer believe it is necessary.
I said it before… If government workers were furloughed during the COVID-19 situation; the “Pandemic” would have been over by April. Cause no one who makes an average of 25 dollars an hour would sit idle for months without a paycheck. During the pandemic govt workers got… Full pay, bonuses and a stimulus ALL at taxpayer expense regardless of how much work they did if they had any clients or work to do at all.
They shut down your churches, they shut down your businesses, they shut down your recreation, your restaraunts, your social circles. THey forced you to wear masks….Then virtually every politician that be has been caught violating their own rules. Then ignored months of rioting and looting as “Peaceful” then condemn anyone who had the audacity to not wear a mask at a Walmart.
New York is not recovering from this….how do you revive a city that lost HALF it’s tax base in no more than a few weeks?.
How Leftists destroy cities
1: Take over a city that was doing well under republicans
2: Reverse policies that created overall success and safety
3: Funnel money into pet projects
4: Vilify Police
5: Drive out investment
6: Tax the suckers that stay behind
Watch your city burn.
It’s a shame because NYC really was an exciting, vibrant city under the stewardship of Giuliani and Bloomberg. But now it’s suffering from a double whammy: the pandemic + a socialist mayor. Dumping de Blasio for a Republican might save the city and New Yorkers have obviously done it before unlike, say, Chicago.
New York was dieing before this.
Two points:
1. I agree with the post generally but would agree even more if the focus were limited to Manhattan. When we consider the Bronx, Brooklyn, Staten Island, etc., the concept of “New York” becomes too vast to pronounce upon. I think the distinction of “Manhattan versus the other boroughs” is key.
2. IMHO the key marker of the Manhattan decline was the movement of people to M who didn’t actually want to LIVE in M. That is, who wanted an expensive condo in the sky that would let them avoid mere mortals and bodegas and litter and all the confusion and chaos of “old” M. I’d call this the Woody-Allenization of a city: look at his Midnight in Paris or Sorrentino’s The Great Beauty… Paris and Rome are so nice… if you remove all the people.