I took advantage of the calm before the storm, to pay a visit on Saturday to my hometown, Trumpville, a.k.a. Manhattan. My college buddy had a son who was acting in an off-Broadway play (closing night, so don’t bother asking). The city I knew as a kid — which, frankly, I never liked very much — seemed as lost and far away as Peter Stuyvesant’s quaint Dutch colonial outpost did to me in 1962.
That lost city of my childhood was one in which a boy could breeze right into the Metropolitan Museum of Art on a weekday afternoon - my school was one block away from it - without the least hindrance.
The place was free. There was no “donation” shakedown at the entrance. And hardly anyone was there. Do you know why? Answer: because most of the adults on the island were at work. It was a mostly middle-class city back then.
I know. It’s hard to believe, given the more recent developments in American life - the salient one being the extreme and perverse financialization of the economy. That is actually what you see manifested on-the-ground (and up-in-the-air) when you visit New York these days. To be specific, what I saw sitting on a bench along the High Line - a walking trail built on an old railroad trestle through the former Meatpacking District into Chelsea - was all the wealth of the flyover states funneled into a few square miles of land on the edge of the Atlantic Ocean.
As I watched the endless stream of tourists and hipsters stride by in their selfie raptures, I pictured the various downtowns of the Midwest I’ve visited over the years - St Louis, Kansas City, Minneapolis, Detroit, Akron, Dayton, Cleveland, Louisville, Tulsa, and many more - and remembered the incredible desolation of their centers. There was no one there, certainly no tourists or hipsters, really no activity to speak of. They were ghost cities.
The net effect of financialization has been the asset-stripping of every other place in America for the benefit of a very few cities on the coasts, and especially the financial engineers within them.
Thus, the ironic rise of New Yorker Trump as the avatar and supposed savior of all those people “out there” in their dying hometowns and beyond. And their tremendously bitter enmity against the “blue” coastal elites, of which Trump is a nonpareil exemplar. History is a trickster.
What I also saw sitting on that bench facing west along the High Line, but also everywhere else I traipsed around the island that day, was the stupendous array of construction cranes against the sky, hoisting slender condominium towers into the clouds, many of them fifty stories and more. To me, it was a very ominous sight. Business cycles can be traced far back in history, but the cycles of these late techno-industrial times have been marked by the most extremes of extremity, and the current one is the dooziest of all.
And, of course, real estate development probably tends to greater extremes as a cycle within the greater economic cycle. Real estate booms and busts have come to characterize modern times, along with never-ending war and ecological carnage. The reason real estate rises and falls so dramatically is because it takes so much time to get these mega-projects permitted and to arrange the complex financing, and then built, then to market the units within. A project gets underway under one set of economic circumstances, and by the time it’s completed, things have changed. Say, a foreign country such as China or Russia puts capital controls on money fleeing its shores, and suddenly there are no foreign billionaires and oligarchs bidding on apartments in New York as a supposedly safe stash for their wealth. That dynamic is underway right now… as the cranes continue to hoist I-beams and glass claddings into the sky.
It’s easy to see that the skyscraper boom in Manhattan is going to end in a fantastic real estate bloodbath. It will accompany the general crash of the debt-fueled financialized economy, like the clanking, groaning, musical score of a horror movie. Unlike previous real estate debacles, these scores of skinny condo towers will not recover, even if they are sold in bankruptcy for dimes on the dollar. They may never even become slums. They will simply be uninhabitable cells in decrepitating buildings that can’t be maintained, because the capital won’t be there to enable it and the financing model based on the deconstruction of real estate rights — i.e. condo-ization — will be dead.
The skyscraper bust will also mark the end of the hypertrophy of New York and, eventually, of all mega-cities like it. They’ve exceeded a scale that will permit them to be maintained and repaired, and when financialization founders on its false foundations, there will be nothing left to support that way of life.