Note—the topic sort of morphed halfway through this. So, sorry.
I’m a native New Yorker. My wife isn’t, but lived all her young adulthood there and is as committed to the idea of New York as any convert. She and I were both in theater there, often at the same theaters but at different times, so we didn’t meet until the 90s, when I moved to Los Angeles.
Often we sigh and say how much we miss New York… and then correct ourselves—we miss New York in the 70s and 80s, not New York now, debilitated as it is from money poisoning. Making a living is for losers—they want to make a killing. Commercial rent is jacked up not by 10% but by 100%, 200%, more, there is no top. And if space remains empty, the political and tax system support that. Once vibrant streets in the West Village are ghost towns, not because of Covid—this is from way before Covid—but because of rents. I suspect, but don’t know, that this is at least partly because landlord families are losing ground to hedge-fund and Wall St landlords who feel zero stake in the life of the city and the culture around them, and only respond, AI-like, to simple numerical metrics.
Corporations—the AI we’ve been living with for centuries… As Cory Doctorow writes in Skynet Ascendant: We humans are the inconvenient gut-flora of the corporation. They aren’t hostile to us. They aren’t sympathetic to us. Just as every human carries a hundred times more non-human cells in her gut than she has in the rest of her body, every corporation is made up of many separate living creatures that it relies upon for its survival, but which are fundamentally interchangeable and disposable for its purposes. Just as you view stray gut-flora that attacks you as a pathogen and fight it off with antibiotics, corporations attack their human adversaries with an impersonal viciousness that is all the more terrifying for its lack of any emotional heat.
Elon Musk’s stated fear of AI seems ironic in that he is such a corporate creature, and they behave in exactly the way that he describes AI in such apocalyptic terms. But that is exactly what is happening, not only to cities, but most visibly in cities, because cities are were value and capital are most concentrated. Yes, a family that owns a few buildings—like my old landlord and his Greek immigrant family; they started with a diner and ended up owning a few dilapidated buildings in midtown, one of which I lived in for 17 years—would form a corporation which owns the buildings; but that is qualitatively different from a financial corporation whose management decides that the ROI they need to justify their bonuses is waiting in real estate and rental properties rather than boring old equities, bonds, and complex derivatives thereof.
I’m not clear on the difference, but I suspect, as with most things, that it’s a gradual difference, a sliding scale, rather than a nice, simple toggle switch. My old landlord wasn’t a financial corporation with no view of what was in the world except certain select metrics, blind to culture and human life, and chewing through humanity to get the coins in our pockets, then pulling the hair and buttons from its teeth. But he did live in Long Island City among his ethnic and religious counterparts, and I don’t think he cared personally all that much about people like me in Manhattan. So he did that thing that landlords do, which is to send in unlicensed contractors to do horribly destructive work on the building for years and years, in the hopes of either driving us out one by one, or, better yet, provoking a tenant lawsuit, the result of which is that the building would be condemned and … we’d all be driven out, all at once.
So was he better than a hedge fund landlord? I guess better would be Art Stabile, the lefty Catholic who lived down the block, owned the building he lived in, and rented out the apartments to young (Catholic mainly, I believe) international students. He had a stake in the building, the street life, and the world from which he earned his living. I don’t know who owns his building now…
Cities become prey to certain cultures. Los Angeles was for a while a creature of Hollywood. The dreams and desires of those who worked in entertainment were legitimate dreams and desires. Others were… less interesting. Hollywood includes artists and craftspeople, so Los Angeles has always been receptive to artists, though somewhat contemptuous of those who don’t—or, the suspicion is, can’t—sell out.
New York is under the spell of Wall St and has been since perhaps the 80s. But Wall St’s culture itself has changed and dragged the city behind it, helpless in its wake. And information technology has supercharged its ambitions, so that, while years ago, it would have been a chump’s game to invest in rental real estate, because management was complicated and expensive, today, rental real estate is pretty good for a return.
I go back to the first episodes of Planet Money—when it was good, when it was important, before they did inane “brand stories” about Hydrox vs Oreos and “ain’t business grand.” It was called The Giant Pool of Money. Investors used to park money in Treasury bonds, but interest rates were lowered to speed up the economy. This meant the T-bills yielded less. So all those smart guys ‘n’ gals on Wall St (really mostly guys, especially then) turned their Ivy League-honed minds to where else they could invest.
Turns out mortgages were just sitting there. So they proceeded to process them via the alchemy of high finance—tranches, derivatives, derivatives on those derivatives—until a small number of folk made a lot of money and many, many people lost their homes in the Great Recession.
They have no stake in Main St. Just like Tyson (of the Foods), Wall St parties are so much more fun than those annual BBQs they use to keep their staff happy with low pay and decreasing benefits.
After the Depression and WWII, there was, for a brief while, a time when the nation’s culture was egalitarian. All Americans (let’s not get crazy; not Blacks really, and not women, not really) were equal, and your boss could live in your neighborhood. He might have a pool and you might not, but big deal! You were all equal, you were all Americans.
But (see Piketty) that was an anomaly, brought on by a confluence of disasters and FDR. Now we’re back to the status quo ante. And, while other nations still strive to emulate America in the 60s, America is turning its back on that and looking to the 1880s.
I don’t like it. No sir, not one bit.