Ford-Rockefeller squabble over NY finances

Some years ago when – I'm now shocked to realise – I had a daughter 10 years old, I remember an evening when one of our oldest friends had just dropped in. I, err... I make an awkward pause here because it's one of the perilous hazards of radio that in order to produce a picture in the listener's mind, you have to identify a man quickly and maybe by his profession, and once you've done that it's too late to stem or contradict the listener's prejudices.

If you could see the man I have in mind, you might take him for a chemist's assistant, genial to the point of comicality, shrewd as only an immigrant can be who came into this country as one of a small Hungarian minority in New York and looked on Manhattan with the wariness of a Highland shepherd dropped for the first time in Shepherd's Bush. 

I would defy anybody who saw this grinning bald head, sitting up at a country diner, gobbling a hamburger plastered with ketchup, I'd defy you to pick his profession or his interests. Seeing him there with his blacksmith's forearms and his check fawn slacks and a blue or yellow golf shirt, you'd be pretty close to the mark if you thought he was a truck driver stopped for lunch. 

To be exact, this man is a retired investment banker and one of the world's, I suppose, score or so experts in Chinese jade. What he has retained from his early wariness and humour as an immigrant is a blessed ability to cut through the jargon of politicians and sociologists and pseudo-intellectuals and all those other types educated beyond their intelligence who pretend to have thought their way through to the fundamentals, but haven't and must vamp, till ready, with a flourish of polysyllables. 

Long before Wendell Willkie said something of the kind, this old comic banker had defined politics as 'who gets what and when'. He's toying with the idea now of writing a small book about the recession and the economy, the central idea of which is that the government is nuts to go on moaning about the number of people who've lost their jobs. He points out that, today, more Americans, by several millions, are at work than ever before. Where we've fallen behind is in creating millions of new jobs for the seven million or so, you might say, newborn Americans who come into the workforce every year. 

Well, to go back to, err... to that evening years ago when he dropped in and there was some kidding talk about an absent friend, one of those types who folds his morning newspaper at once to the stock market reports, a man who, as the market rocketed between the pit and the stratosphere, worked himself into alternating frenzies of joy and despair. One week he'd glow with the news that he'd just made $10,000 and the next week he was broken by the thought that he'd just lost $20,000. 

My ten-year-old, sitting in on this tale, suddenly upped and said, 'I don't understand, I thought you put your savings away. How can you be rich one week and the poor and then rich again?' And my friend said, 'Susie, you're absolutely right. It cannot be done. This man hadn't won anything or lost anything.' She didn't get it. 'Well,' he said, 'suppose you have a doll.' 'I have a doll', she said. 'All right,' he said, 'what did it cost when it was new?' I chipped in, 'Two dollars.' 'And what,' said my friend, 'would the same doll cost today?' 'Five dollars?' I said. 'OK!' said Susie, bright as a button, 'So I've won three dollars?' 'Only,' said my friend, 'if you sell it.' 'But I don't want to sell it!' she said. 'You wouldn't sell it for ten dollars, would you?' 'No, I wouldn't,' she said, 'anyway, it's kind of ragged.' 'That's it!' said my friend, 'You might only get fifty cents for it. But to you it's worth more than the money. And it's the same doll and it means something to you and you haven't lost a cent or won a cent if you don't sell it. It's just the same with the stock market.' 

Well, he knew it wasn't quite the same, but near enough to illuminate the manic depressive temperament of the people who watch themselves, every day, win and lose fortunes on nothing but paper. 

The other night we were all tangled up, as everybody is, in the knot of New York City's finances. I've not yet met anybody who is able to give you a child's guide to the mess or even a simple, subtle account that somebody else will not indignantly refute but, just in passing, my old friend said for the enlightenment of any puzzled ten-year-olds present, 'You know, you'd think that a man who six years ago earned $30,000 a year and met his obligations and was comfortably off and who now earns $120,000 a year, you'd think he'd be managing pretty well, even with inflation. But in fact he's spent $128,000 – he's $8,000 in the red.' 

That, in a nutshell is the correct ratio between New York City's income and improvidence down the last half-dozen years. In the beginning – say, five months ago – when we first heard about the dizzy juggling with the city budget, New York City's fiscal headache was a joke and then it was a scandal. And now it's a threat not only to the safety of the city, but to the national economy and to the confidence of other nations in America's ability to keep house. But, as I mentioned last time, it took the chancellor of West Germany to frighten the White House into taking a national view of New York's impending bankruptcy. 

At the moment that I'm talking to you, there is a rather embarrassing squabble going on between President Ford and Vice President Rockefeller though the vice president has hastened to deny such an undignified word as 'squabble' and said that his differences with the president about whether the federal government should come to the rescue of the city are minimal. 

Well, as old Al Smith used to say, 'Let's look at the record'. Two months ago, President Ford's most direct comment on New York City's financial woes was this, 'They don't know how to handle money. All they know is how to spend it.' About a month ago, he said there would be some repercussions nationally if New York City defaulted but it would not be catastrophic. And only a week or so ago, he said, 'I don't think it's a healthy thing for the federal government to bail out a city, and I mean any city, that has handled its fiscal affairs as irresponsibly over a long period as New York City has.' 

The same week, Vice President Rockefeller talked in public in general about the plight of our cities and in particular said that New York City's need for immediate federal aid was desperate. To this, the president said nothing but he let various spokesmen for the White House be quoted as saying that Mr Rockefeller was speaking only for himself. 

Well, it's not possible under the American system for the vice president to speak for himself, except on such un-debatable topics as his taste in paintings and how he likes his steaks cooked. It has also been an iron rule of the vice presidency that its occupant keep his mouth shut on all matters of national policy unless his remarks have been laundered by the White House or are meant to serve as a trial balloon for some policy that the president himself is not quite ready to float. 

The even more iron rule is that the vice president doesn't do anything official. He is by no means an assistant or deputy president and, in every administration, he is a long, long way down the ladder of presidential advisers and assistants. His main job, as Mr Mencken said long ago, is to sit in the outer office and hope to hear the president sneeze. 

Mr Rockefeller has been attacked by two forces: by veteran congressmen who wish the vice president would adhere to his traditional role and by conservative Republicans who want to see Mr Rockefeller unseated as President Ford's running mate next year. Many of these conservatives are, indeed, the vanguard of the 'Ronald Reagan for President' army. For 15 years, since they booed Rockefeller off the podium at the presidential convention, they have hated Rockefeller as a liberal renegade in the Republican camp and, in truth, many of them would like to see both Ford and Rockefeller thrown off the ticket. 

Some of the sniping at Rockefeller would, at one time, have been thought vicious in the extreme but, in our time, when a so-called liberal crusading newspaper isn't above printing the private, dinner-table conversation of the Secretary of State, just because it was secretly recorded by some miserable eavesdropper, in our time, such sniping as Mr Rockefeller has received is considered a public service. The snidest hint at Mr Rockefeller's motives has been the remark that he is the brother of the president of Chase Manhattan Bank. 

Well, any sneer at this fact of life is instantly wiped away by the more horrendous fact of life that Chase Manhattan and a couple of other banks, as large as any in the country, own between them something like 25 per cent of New York City's useless bonds. Whoever may be the brothers of their combined presidents, it would offer a very mean sort of satisfaction to anybody if these banks followed one of the largest supermarket chains in the nation and went into spectacular bankruptcy. 

Last time, I went into the peculiarity of New York's plight as contrasted, say, with a solvent city like Chicago and we picked on the city's preposterously high burden to pay for all welfare as the villain of the plot. There are other villains but it would be an easing of an enormous load if Washington lifted that one off the city. To do that, Washington would certainly insist that New York require some residency qualification for people going on relief. 

As it is, anybody can come here, give a local address and, within the month, go onto welfare. The parks are crowded these golden fall days with families who together get, for free, more than two or three of them could earn. They saunter cheerfully under the trees learning about their new hometown at the expense of the New Yorker who, alone, among 200 million Americans has to pay a national income tax, a state income tax and a city income tax. 

Sooner than later, let us hope, Mr Ford will listen to his vice president and to the Europeans who can tell him that there is not a city in Europe that is unsupported by the national government, not one whose budget is not scrutinised – in some places controlled – by the government, in exchange for the guarantee that the government will simply not allow the cities to go bankrupt.

This transcript was typed from a recording of the original BBC broadcast (© BBC) and not copied from an original script. Because of the risk of mishearing, the BBC cannot vouch for its complete accuracy.

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