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“The Menace of Prosperity” gives an important history of New York’s fights over economic growth and inequality.<\/p>\n
The University of Chicago Press, 2025<\/p>\n
The likely election of democratic socialist Zorhan Mamdani as the next mayor of New York City is sparking intensive debate about the city\u2019s economy, the role of government, and the future of democracy. Mamdani\u2019s blunt statement<\/a> that \u201cI don\u2019t think we should have billionaires\u201d challenges New Yorkers to reconsider who benefits from the city\u2019s prosperity– and what alternatives might be possible.<\/p>\n That makes Daniel Wortel-London\u2019s The Menace of Prosperity: New York City and the Struggle for Economic Development, 1865-1981 <\/a>(University of Chicago) especially welcome. Both richly detailed and visionary, The Menace of Prosperity is an ambitious and important new history of New York\u2019s recurring struggles over growth and inequality.<\/p>\n New York City\u2019s Forgotten Economic Alternatives<\/p>\n Wortel-London argues that New York, like other cities, has repeatedly embraced an overly narrow conception of the economy. He documents in detail the history of ideas and conflicts shaping the city\u2019s tax, budget, and investment policies. At the center of this history is what he calls New York\u2019s \u201cfiscal imaginary\u201d: an enduring obsession with pushing up real estate values through favorable taxation, zoning, and infrastructure investments that foster debt-driven speculation.<\/p>\n Both private investors and the city take on more and more debt to finance this strategy, producing repeated fiscal crises when the debt can\u2019t be paid off due to economic and financial stagnation or reversals. He calls these \u201chidden flows of profits and plunder\u201d that \u201cdeepened inequalities while wrecking urban economies.\u201d <\/p>\n Yet he refuses to see this history as inevitable. He highlights reformers, visionaries, and civic movements advocating \u201calternative development strategies\u201d that rely on cooperation, public investment that was not captured by private interests, and small and community businesses rather than speculation and rent-seeking.<\/p>\n Wortel-London traces New York\u2019s evolution from post-Civil War industrial center to the finance-dominated city that emerged from the 1970s fiscal crisis, tied to the city\u2019s long-term focus on rising real estate values and speculation. His central argument is that this trajectory\u2014culminating in finance\u2019s dominance and deep inequality\u2014 was neither inevitable nor the best way to achieve broadly shared prosperity. <\/p>\n He shows that New York has always hosted competing visions of what a good economy should be and who it should serve. But he sees that vision as eroding over time, and one of his goals is reigniting debate over how the city\u2019s economy could be better organized to foster greater cooperation and equality. <\/p>\n Challenging Standard Views Of New York City\u2019s Economy<\/p>\n At the heart of Wortel-London\u2019s analysis<\/a> is his concept of \u201cfiscal imagination\u201d\u2014what he defines as \u201cthe set of ideas people use to define what the economy is, how it works, and what it\u2019s for.\u201d From the 1860s through the 1980s, New Yorkers repeatedly disputed how to balance economic growth, well-being, and justice. What prevailed, in his view, was a narrow vision built on driving up private real estate values, supported by favorable taxation, zoning and regulation, and infrastructure investments, financed by ever-rising levels of public and private debt.<\/p>\n This stands in contrast to the more standard narrative of New York\u2019s rise as a port, developing logistics and finance tied to trade; its rise and decline as a manufacturing center; and its transformation into today\u2019s finance-driven, unequal city. Businesses seeking profits and scale drove the economy, constrained at times by reformers seeking to share prosperity through progressive taxation and spending on public goods like housing, transportation, education, and public health. <\/p>\n Wortel-London gives us a far more contested history where reformers, visionaries, social critics, and working people sought to reimagine the economy, just regulate and tax large companies and tax the wealthy. <\/p>\n