Location: The theme that unites the Mayor’s 2030 PlaNYC is that the city will grow by about one million people in the next 25 years. Do you agree?
Mr. Beveridge: It’s an interesting thing because the way they framed it was that it’s inevitable that the city’s going to grow that much. … If you take a look at it, that isn’t that much growth, percentage-wise, since they have it over 30 years.
So what happens in 20 years? How big is the city?
It will be bigger. Unless something bad happens! Then it will be smaller.
The reason I ask is because so much of the development in the city and so much of the rezoning to foster that development is predicated on the population growth.
The growth—it may cause growth. In other words, if you go to a place like Portland, Ore., they made a decision not to grow so fast. And, if you think about New York, it’s very dense now; it’s been about the same level of density since about 1940, actually. So, in terms of building New York up … that’s kind of what you’re going to have to do to have it grow.
I would argue that it’s not like, ‘There’s a lot of growth so we’re going to build housing.’ They’re building a lot of housing so they have growth.
So the housing will draw people?
Well, housing and, presumably, economic activity. It’s sort of an interesting thing the way the plan’s set up because the underlying argument was, ‘We’re going to have all this growth so we need more infrastructure.’ But … most of the people who are going to be in New York in 2030 are already here. New York’s about 8.2 million; you’re only looking at 800,000 more. Regardless of whether it grows at all, you’re going to need to do a lot for the infrastructure.
So, for example, roads are not in that good repair; subways; schools—all that stuff. So it strikes me that the growth thing is maybe a little misleading.
The population growth?
Yeah. It’s like, to predicate why we need PlaNYC 2030 on the fact that we’re going to grow—usually, what you do is you say, ‘How much should we grow? How do we want the city to be?’ Instead, they say, ‘We’re going to grow.’ And I guess they look at it in a positive light.
Statistics show that young people, especially young professionals with children, are leaving the city—
Well, not as much!
But the city is getting older. What’s that mean for the city in 20, 25 years?
Well, the U.S. is going to be a lot older than it is now. The city has for years been a fairly decent place for old folks to live.
New York has?
Yeah. There’s lots of services, so forth and so on. So, if it gets older and older, then you’ll have a larger dependent population; and where the tax revenue will come for that, to support some of the services dished out locally, I don’t know.
You wrote in the Gotham Gazette in 2007 that ‘New York City, despite many claims to the contrary, actively participated in the housing bubble.’ What’d you mean by that?
The median home price here, according to the [census’ American Community Survey], went up 91 percent in real terms from 2000 to 2006. Income did not. Median income is flat; median house value doubled. Sounds like a bubble to me. I mean, I get calls from various real estate types; and they always want me to say, ‘The prices will never go down.’
What do you tell them?
I tell them that they might.
Year after year, young people come into the city, despite the fact that there’s stagnant wages and the cost of everything is rising. So the conventional wisdom is that New York is inoculated against the sort of decay that’s hit Philadelphia, Detroit, cities like that.
Well, that’s different than the housing boom. There’s been a real demographic transition in New York.
The African-American population is now declining, and has been declining in terms of non-immigrant blacks for years; and now the overall black population is declining. It’s sort of been propped up by immigrant blacks from the Caribbean or Africa.
And the last time that the census estimates were released with respect to race, age and Hispanic status, the estimate in the growth of Hispanics from—I think it was from ’06 to ’07—was 927 Hispanics.
Nine hundred twenty-seven?
Yeah. So the Hispanic growth has stopped. White loss has stopped. Asian growth is continuing. And if you look at the toddler class, particularly in Manhattan, white toddlers—one of the analyses that ran in The Times was, median household income of households of non-Hispanic white toddlers in Manhattan, [ages] 0 to 4, was $285,000.
So some of the younger people who probably used to immediately go to Scarsdale or Pelham Manor or Greenwich or something seem to be staying for a while. And this year there seems to be a tremendous rush on getting slots in kindergarten and first grade.
What if the local economy tanks, particularly financial services?
The last time we had a market crash was in ’87. Real estate followed it down—a lot.
Did the city’s demographic makeup change much?
Well, I think it has been changing since 2000. The immigration was going apace for much of the decade of the ’90s, and, according to the Pew study, it started slowing down in ’97. So immigration has slowed down; people are having babies and staying in New York. If this trend is sustained, it’s a sea change!
It almost seems that to live relatively comfortably in Manhattan and in parts of Brooklyn right now, you have to be involved in financial services.
Financial services or the high end of law.
Right. And if that starts to dip, it reverberates across the whole city.
It will. And there’s a historical precedent for this, which was after the crash of ’87.
We used to go to a Christmas party that was [thrown by] a friend of mine in the financial sector, a woman who was on the hatchet committee at Merrill Lynch—and then she got fired. I think she worked at Chase for a while; when she went to Chase, the elevator starter had been a broker in the ’60s.
Are you kidding me?
Where was the Christmas party?
They would run it every year. So I remember when the markets were going very good—my wife and I are both academics—and they’d say, ‘Oh, well, you’re an academic. You don’t make much money, do you?’ And then a little later, when the markets were down, it was, ‘Oh, you’re an academic. You have tenure, don’t you?’
How will New York City be remembered from 2001 to the present? Like, the 1950s were extreme growth. The 1970s were a slow decay.
Let’s say we have a real problem. Things like Yankee Stadium, Atlantic Yards, Citi Field—the way in which those things have been financed … you’re looking at gimmicks that are kind of like gimmicks that happened before the last financial crisis, in the 1970s, where all the tax revenue goes to finance development projects and you don’t have any extra spillover. If it turns out we have a downturn, that may be what the Bloomberg years are remembered for: putting up a lot of projects that turned out to be very difficult to finance. …
If you had a real downturn, things could be really bad because you have all of these obligations that have been rolled up and it would be hard, probably, to meet them; so that’s sort of like the dark view.
If, on the other hand, even if we have a fairly short—what’d they call it—adjustment in the real estate market but the long-term growth continues, then this will all probably look like a real good idea.