Big Cities: New Deal, war years

Trite to say, the Depression years were tough on our Big Cities. In these awful years would—could—municipal and state governments rise to the occasion? They tried. At its best, it was reactive. Chambers were politically out of step with the Depression and the federal government’s responses to it: they lacked power and capacity to play a serious role in the Depression—they, however, did reassert leadership in the war years. The Depression overwhelmed state/local governments. Resources simply did not exist. Municipal impotence translated into municipal dependence on Washington.

Before we concentrate on the Depression’s ED implications, it is important to keep in mind several background dynamics. Prohibition and crime were in high drama; the Southern Diaspora did not stop. Factories accelerated their suburban exodus. In 11 of 12 northeastern metros, “the number of manufacturing employees in suburbia increased at a faster rate … between 1929 and 1939 than the number of industrial workers within the central city” (Teaford, 1990, p. 24, Table 3).¹ FDR opened the door to significant change in many municipal policy systems by working with unions and accommodating union-supported initiatives in his agenda. By 1940, unions were important actors in several Big City municipal policy systems, having gained entry during these years. Business and chamber reaction was predictable: sharpening a partisan divide, creating a fault line in municipal economic development and a cultural divide between Privatist and Progressive political cultures.

Labor unrest—centered on wages and the open shop—hit several cities especially hard. In 1934, Milwaukee suffered through 107 strikes. Minneapolis was not much better. Toledo and Akron (Ohio) were hit hard by prolonged strikes. The National Guard put down a 1937 strike against Republic Steel. The worst year was 1937, typified by the Flint sit-down strike against General Motors that resulted in GM recognizing the United Automobile Workers (UAW) as the plant’s bargaining agent— the first. By the end of the decade, cities like Detroit, formerly ground zero of the open shop, was recognized by the New York Times as “one of the best organized cities in the nation.”

The news from Flint, Detroit, Cleveland, Milwaukee and elsewhere had given [America’s] heartland a reputation for poor labor relations; in the future industrialists would invest in the Midwest at their own risk … Pressure from the federal government’s National Labor Relations Board combined with strike action by labor … [forced] management to yield to [worker] demands. (Teaford, 1993, pp. 184–5)

If one kept one’s job (and 75 percent did), life, however uncertain, went on. Families shopped for food and for Christmas—spending much less. People bought cars (5.6 million in 1929, 1.4 million in 1932). In some cities, car thefts were more numerous than car sales. Households purchased homes. Decentralization continued during the Depression. Still, the Depression devastated municipal treasuries, dumped unemployed millions on the streets, terminated business investment and drove small businesses into bankruptcy. Banks went under, resuscitated somewhat with New Deal legislation, the 1933 Glass–Steagall Act (GSA) among others; lending was fragile. One might think crisis generates action, but acting requires resources—and believable solutions to identified problems. Mayors left to their own devices ranked pre-Depression style ED lower on their agenda.

BIG CITIES COPE WITH THE DEPRESSION

One way or another most Big Cities concentrated on fighting unemployment and its misery. The Community Chest was the most common initiative. The National Association of Community Chests and Councils selected a week in October 1931 to promote organized drives in 174 cities. Most cities surpassed their goals. Before it was over, 386 cities and towns had joined in raising almost $85 million. Rochester New York tried something different. The city manager (1930) successfully requested a special work relief appropriation from the city council. The original $250,000 appropriation expanded to $800,000 and the next year increased to $1 million. Taking advantage of a newly approved state law, he augmented this with a state work-relief grant. Then Milwaukee’s mayor, Daniel Hoan, addressed Rochester’s chamber, describing the “advantages” of a city without debt. Rochester, worried about its work-relief program, dispatched a committee to tour key cities to determine how they were handling work-relief initiatives. The committee returned with the observation that Rochester was a national work-relief leader; but no evidence existed that work-relief had any material impact on local unemployment and it left the city in considerable debt. Rochester reduced work-relief funding (McKelvey, 1968, pp. 80–81).

Little Rock combined an emergency appropriation of $20,000 in 1931 with $25,000 in private sources to provide emergency jobs. The money was gone within three months. Proper Philadelphians organized a Committee on Unemployment Relief in 1930. They raised nearly $4 million for free food and make work jobs for 14,000 destitute heads of families. By 1931, this ad hoc group evolved into the Bureau of Unemployment Relief within the city’s Public Welfare Department and distributed $3 million in city funds in the form of food, fuel and clothing. The Community Chest campaign raised millions more, but all available money had been tapped and dispensed by June 1932, when organized relief in Philadelphia stopped. (Abbott, 1987, pp. 48–9)

Detroit, then as now, was the poster child of fiscal collapse. Detroit was one of the few large cities that assumed responsibility for paying relief to its unemployed. By 1931, with over 100,000 unemployed, Mayor Frank Murphy (Democrat) pulled together an “unemployment committee” to try to deal with the mess, but all it came up with was potato gardens and soup kitchens. While Detroit’s relief program was relatively small (albeit six times more per capita than the second city, Boston, which offered a relief program), it was among the first cities to edge toward fiscal collapse. In 1932 “Detroit owed $27 million per year to its creditors; its total budget was $76 million, of which only $57 million was actually collectible” (Abbott, 1987, p. 48). Detroit defaulted. Prior to 1934, federal municipal bankruptcy laws were non-existent, but over 2000 municipalities were in default (Florida, California and Texas—all with previous real estate booms—were worst hit). Congress responded with the Municipal Bankruptcy Act of 1934, amended in 1937 (Wilson, 1974, pp. 177–80).

Cities Take Advantage of Federal Programs

Big City mayors, knowing their state governments would not/count not respond, pressed hard for massive federal assistance. Led by Detroit’s mayor, Frank Murphy, Big Cities organized to do battle in Washington DC. Finding existing municipal national associations of little help in resolving Detroit’s unemployment relief crisis, Murphy pressed hard for over two years (1931–33) to establish the United States Conference of Mayors (USCM). Unlike the National Municipal League, which was open to cities of all sizes, the USCM initially restricted its membership to cities exceeding 50,000 in population.

The mayors of big cities believed that their communities had special needs, and unlike most of the leaders of the smaller towns, felt that federal action was needed to cope with their problems, … the USCM attacked the old dogmas of home rule and state’s rights and espoused a cooperative federalism. (Gelfand, 1975, p. 39) While enjoying success in garnering federal public works and Works Progress (later Projects) Administration (WPA) relief funds, the USCM did not enjoy a special relationship with the FDR administration before 1936.

Although he espoused national powers to combat the Depression, Roosevelt remained attached to some of the traditional principles of states’ rights. He examined the subject of federal aid to cities from the angle of constitutional theory, and came to the verdict that since ‘municipalities are the creatures of State Legislatures, primary duty is on the state to see to their solvency … Sharing the [old-style] Progressive’s faith in greater home rule, Roosevelt maintained that ‘the less the Federal Government has to do with running a municipality in this country the better off we are going to be in the days to come. (Gelfand, 1975, p. 55)

The quest for federal dollars usually meant capturing their share of new federal jobs programs for the poor and unemployed. The alphabet soup of such programs included the Federal Emergency Relief Administration (FERA), the Civil Works Administration, the Public Works Administration (PWA), the WPA and the Civilian Conservation Corps. Aside from the obvious jobs they funded, they also constructed public infrastructure (including beaches, parks, levees, bridges, tunnels, swimming pools, libraries, streets, recreational facilities, arts-related buildings, courthouses and city halls, and miles and miles of sewers). Supposedly, these programs built more than 100,000 public buildings.

In 1924 the Republican presidential plurality was 1.25 million (Abbott, 1987, p. 51). In the Depression, unemployed ethnic and black relief/job recipients voted for FDR and the Democratic Party. The shift had started in 1928 when the Democratic presidential plurality in the nation’s 12 largest cities was 38,000, becoming in 1936 over 3.6 million. During these years, the solid “blue” Big City Democratic voting base was established—it continues to this day. The second, more disputed effect was its alleged displacement of the urban political machine by federal programs and bureaucracy. Up to and through the Depression many, if not most, Big City policy systems enjoyed a significant machine presence. Several well-known boss systems were in operation: Crump, Memphis/Shelby County; Flynn and Tammany; Kansas City’s Pendergast; Boston’s charismatic Mayor Curley; Chicago’s Kelly/Cermak; and Jersey City’s Hague machines are the most well known.

Most of these machines foundered after the end of World War II. The blame was placed on the so-called “last hurrah thesis” which argued that the poor and unemployed no longer needed the favors of the ward boss, and unhinged ethnic electoral support of machines. Critics of the thesis observe that machines changed form after the war, but they have never really disappeared—many persisted for a half-century or more after the New Deal. Critics also argue that except for social security, the 1933 National Industrial Recovery Act (NIRA), the public works and jobs programs, flowed dollars through states—administered through municipal bureaucracies over which machines maintained influence. Far from destroying machines, it solidified Democratic mayoralbased machines: Cermak, Pendergast and Pittsburgh’s Lawrence machines (Wilson, 1974, pp. 184–7). The simple answer to postwar boss collapse was that they died of old age (Dorsett, 1977, p. 115).

La Guardia

The go-to mayor with access to FDR’s New Deal was New York City’s Fiorello La Guardia (1933–45). Nicknamed the “Little Flower,” La Guardia’s access was more through Eleanor Roosevelt than her husband. FDR ran hot and cold with the mayor, at one point endorsing an opponent. The La Guardia–FDR relationship was complex and constantly in flux. What could one expect from La Guardia, an avowed socialist, registered Republican who won three elections with a “Fusion” Party endorsement?

Harold L. Ickes was correct in his observation that La Guardia was not a team player, but one who wanted to run all over the field with the ball. He simply could not confine himself to working through the states as the administration and the governors had agreed. (Funigiello, 1978, p. 52)

New York was uniquely successful, but even New York City had to fight tooth and nail to obtain funds. Compromise and intensive and persistent effort were required to keep funds from approved programs flowing through FDR’s bureaucracy. In the depression/ wartime environment, municipalities pressed their agenda through whatever opportunities appeared. For example, a broadly defined civilian defense program allowed La Guardia to maneuver himself into the Office of Civilian Defense as its intergovernmental chair. He used that position to bypass state government, establish direct federal–state relationships and press for a variety of agendas—often overlapping with Eleanor Roosevelt’s agenda (Funigiello, 1978, Chap. 2). One reason La Guardia arguably was New York City’s greatest mayor is in part due to his capturing federal funds.

The three La Guardia administrations fit the social reformer/Progressive mould to the tee. Incorruptible, working-class, people-oriented and anti-large business, he harkened back to the turn of the century. La Guardia unified the NYC transit system under municipal control; broke the city’s dependence on bankers; built parks and low-cost public housing; reinstalled a merit-based civil service; reorganized the police force; built airports and highways; and fought tirelessly against the remnants of Tammany Hall.

It was during La Guardia’s tenure that much of Robert Moses’s bridge/highway/ tunnel construction occurred. Previous to La Guardia, Moses developed his famous administrative, fiscal and political independence based on his public authority empire. For the most part, Moses was beyond the control of La Guardia (Moses was a political rival to La Guardia in several elections). During these years Moses regularly took on, and sometimes won, serious battles against no less than the President of the United States, who unwillingly financed a great deal of Moses’s most famous projects.

La Guardia links old-style social reform mayors to a more contemporary age. He is clearly associated with the infrastructure strategy; the airport named after him is justified—it was his idea and he built it. A committed participant in the public housing/slum clearance movement, La Guardia played ball in the Age of Urban Renewal. He retired in 1945 with New York City on the brink of fiscal collapse resulting from, it is alleged, bloated union wages, sprawling public bureaucracies and excessive debt from his outsized infrastructure installation.² In that regard, he followed in the Josiah Quincy tradition.

Depression/War Years Chambers

Nadirs often follow “golden years.” The twenties came as close to the golden years of chamber-style economic development as one could expect. Industrial bureaus, sophisticated marketing and industrial recruitment characterized chambers throughout the nation. Mead in Magicians of Main Street provides numerous examples of chamber involvement in policy areas such as tourism, airport development, labor force training, education and chamber professionalization during these golden years. The national chamber in 1929 claimed a membership of nearly 1600 state and local chambers/boards of trade (Mead, 2014, pp. 231–74).

The Depression cut the legs off chamber-style economic development. When the cities of America needed economic development the most, a voluntary/membershipbased organization was at a decided disadvantage. Likened to finding water in a desert with few oases and many mirages, industrial recruitment went dry. Industrial recruitment yielded frauds and poor-quality leads. With businesses failing right and left, throwing workers on the streets, business leadership held limited appeal among the general population. The obsessive chamber struggle against unions did little to help. Business and chambers opposed outright most New Deal business-related initiatives; FDR was happy to characterize them as the personification of evil. Therefore, with the federal government the only game in town, chambers refused to play.

Chambers were at a loss in how to respond to a crushing depression. There was simply little the chamber could do. Initially, “Buy Local” campaigns, followed by “Buy Anything Now” campaigns, were commonplace (Mead, 2014, pp. 275–8). Failing business translated into serious reductions in membership, catastrophic budgets and then staffing crises. In response, chambers and other local business organizations merged. While some large corporation elites crossed party lines to join in FDR’s New Deal, Main Street did not follow. As FDR moved “to the left” with NIRA, away from the gold standard and austerity, cries of socialism were increasingly heard. The 1936 elections were the high point in business opposition to FDR.

Chambers never gave up, but continuing to find ways to help their communities cope—and some activities—did help. “Entertainment” events, a big deal in a depression, lifted community spirits. The radio reported sports events like boxing matches, baseball spring training, parachuting turkeys (WKRP fans, it really did happen),³ Added to this were Olympics, horse and dog shows, golf and supporting sports stadia. The Washington DC chamber scheduled the first ever Cherry Blossom Festival in 1930, before becoming embroiled in a geisha girl scandal with the Washington Post; the event was rescheduled to 1934. Centennial expositions (Dallas) and even World Fairs (New York) characterized the later years of the Depression. Tourism and convention promotion did not stop in these years. Chambers competed to acquire federal support and monies to expand factories and hire workers. Chambers found new meaning with the war, aggressively lobbying for federal appropriations for shipyards and munitions factories, airports, naval facilities and military bases.

One of the most inspiring examples of positive chamber action was the 1938 Harlem Compact. In that situation, Harlem stores (Kresge, Woolworth and W.T. Grant), staffed overwhelmingly by whites, almost resulted in violent reaction from excluded AfricanAmericans. The Uptown Chamber brokered a deal with the Greater New York Coordinating Committee for Employment (led by 29-year-old Adam Clayton-Powell) so that African-Americans would receive one of every three jobs that opened up (Mead, 2014, p. 308).

Chambers retained their position as the community’s primary multifunction economic development organization during these years; but by that point they were now sharing ground with new organizational actors such as housing authorities, city planning departments and newly rising redevelopment authorities. The needs of the era had turned away from industrial recruitment to physical redevelopment. Physical redevelopment was beyond a chamber’s powers—a public authority was required.