period, from approximately 385,000 in 1961 to nearly half a million in 1971. That year, city officials said that Hamilton had reached a crossroads between its industrial past and postindustrial future. Canada’s steel town, planners reported, “had undertaken ambitious programs to shed this role and develop strong commercial and cultural sectors.” They expected publicly funded urban renewal programs and private high-rise construction to revitalize downtown. The expansion of McMaster University, the establishment of Mohawk College, and the construction of a theater-auditorium complex signaled “that the educational and cultural side of Hamilton will be significant forces in shaping the city’s future.”2 The city’s economic development staff urged Mayor Vic Copps to pursue jobs in commercial and non-industrial sectors. “While manufacturing will always be the foundation of our city’s economy,” they noted, “in the future the big growth in our jobs will come from the service sector. Already the city’s economic base is changing and Hamilton should see its future growth and development spread out into the whole economic unit of which this city is the natural center.”3 Planners’ enthusiasm about Hamilton’s future was somewhat tempered, however, by their assessment that downtown building conditions remained “generally fair to poor.”4
Within a few years, public officials’ optimism was shattered by upheavals in the federal relationship with cities, made worse for Pittsburgh and Hamilton by the near-simultaneous restructuring of the international steel industry in the wake of the 1973 oil crisis. Between 1973 and the early 1980s recession, the basic steel industry experienced a series of crises of global overproduction.5 In the United States, integrated steel producers responded to changing competitive conditions by intensifying disinvestment practices already underway and laying off large portions of the workforce, shutting down mills in Pittsburgh, Youngstown, and Chicago. In Canada, the steel industry downsized and automated to remain competitive. On both sides of the U.S.-Canadian border, urban tax bases shrank as industrial and population decentralization accelerated, and local governments could no longer rely on predictable funding streams from higher levels of government.
In Pittsburgh and Hamilton, public officials responded to manufacturing decline and federal retrenchment from urban development by trying to form (in Hamilton) or resuscitate (in Pittsburgh) the public-private partnerships that, from their perspective, successfully remade manufacturing centers after World War II. They did so in a decade in which national policy formulation in the United States and Canada reflected common concerns about intergovernmental relations, the future of industrial cities, and the public versus private role in urban and economic development. In both countries, national policy orientations pointed toward accelerated privatization and decentralization by the end of the decade. The very different public-private partnerships that guided development in Pittsburgh and Hamilton over the course of the 1970s shaped—and were shaped by—national policymakers’ ideas about the future of industrial cities and the proper role of the government in urban and economic development.
Pittsburgh’s New Partnership
Pennsylvania governor Milton Shapp had been right to be concerned about the effects of Nixon’s revenue-sharing programs on the fiscal health of Pennsylvania’s cities: the amount of revenue shared was not enough to meet the needs of state or local governments. The Nixon administration had structured general revenue sharing such that booming southern and western states received more federal funds than did cash-strapped northern industrial states.6 After revenue sharing went into effect, Shapp sought to make up budget shortfalls by raising state taxes. He tried to secure support for tax hikes at the local level by promising mayors that he would increase state funding for cities. Flaherty’s response must have come as something of a shock to a New Deal liberal like Shapp: Flaherty told him to keep the money and maintain tax rates.7 When Flaherty took office in 1970, Pittsburgh’s seminal postwar urban renewal program had just wound down. Between 1965 and 1968, Pittsburgh had received over $100 million in federal grants-in-aid, an average of slightly more than $25 million a year. Pittsburgh’s debt burden was up in 1970, but city planners predicted that the federal funds they expected to receive, along with anticipated new private investment, ensured a rosy fiscal outlook into 1975.8 The planners did not account for funding changes under Nixon’s revenue-sharing proposals, and, between 1970 and 1977, the year Flaherty left office, the federal government slashed the amount of aid it sent to Pittsburgh by a third.9 Flaherty took up the challenge of a reduced city budget and greater debt by implementing austerity policies, eliminating public-sector jobs, and reducing some city services.
Unlike his Democratic predecessors, who were beholden to both the Allegheny Conference and the unions, Flaherty demonstrated a concern for the outsized influence of interest group politics that made him more like Jimmy Carter than like Lyndon Johnson. Former city planning director Morton Coleman recalled with some understatement that Flaherty “was not a big government person.”10 He was the first of a new breed of fiscal populists who emerged in the 1970s: liberal Democrats who embraced economic conservatism when faced with tax revolts and urban financial crises.11 Democratic mayors like Flaherty and, later, Ed Koch in New York City, Diane Feinstein in San Francisco, and William Green in Philadelphia rejected the political legacy of the declining New Deal coalition and promoted instead new modes of governance that they saw as more consistent with their limited resources and emerging middle-class resistance to tax increases. Presaging the centrist New Democrats who seized control of the Democratic National Committee in the mid-1980s, these mayors remained socially liberal even as they attacked the large-scale social programs of their Democratic predecessors. Instead, Flaherty and mayors like him focused on government efficiency—often at the expense of public employees’ unions—and sought to placate welfare advocates and African American activists with symbolic but inexpensive programs and appointments of women and minorities to prominent positions.12
Pittsburgh’s well-oiled Democratic machine had never encountered the likes of Flaherty. Between World War II and 1970, Pittsburgh’s mayors (with the exception of Flaherty) were hand-selected by the Democratic Party. After four years on city council and a close relationship with party leaders, Flaherty rejected first an invitation to be Mayor Joseph Barr’s handpicked successor, beholden to the party for campaign money, and a subsequent effort by Allegheny Conference members to lure him onto the Republican ticket. He campaigned instead as an unendorsed, independent Democrat and beat the machine candidate in the Democratic primary; in the general election, he ran on the platform that he was “nobody’s boy.” He financed his campaign through donations, launched innovative billboard and newspaper advertising campaigns, and won handily. Four years later, after alienating the Democratic Party, organized labor, his predecessor, most of the city council, the police, the firefighters, corporate CEOs, African American leaders, and both of the city’s major newspapers, Flaherty ran unopposed for a second term, having secured both the Republican and Democratic nominations. The joke around town was that “nobody likes Pete except the voters.”13
Pittsburgh experienced problems common to North Atlantic manufacturing centers earlier and more acutely than other cities, and Flaherty’s focus on government efficiency and the austerity programs he implemented prefigured the more severe policies put in place in the middle of the decade in New York City. Flaherty eliminated a wage tax (which was later reinstated) and cut property taxes three times. He removed 18 percent of the nonuniformed workforce (nearly 2,000 workers) from the city payroll, largely through attrition and departmental reorganization. He fired Democratic Party officials from their longtime patronage positions and replaced them with young department heads tasked with increasing government efficiency. He was openly scornful of city council and saw no reason to respond to interview requests from journalists. He eliminated chauffeurs for city department heads; when Teamsters leader and city councilor Thomas Fagan challenged Flaherty’s decision, public opinion was firmly on Flaherty’s side.14 Flaherty improved some city services while allowing Pittsburgh’s aging infrastructure to collapse; he infuriated county officials, the Democratic Party, and the business community by blocking an unmanned light rail from downtown to the South Hills; and he severed the carefully nurtured relationship between city hall and the business community. At a time when other
