When former President Donald Trump deployed the National Guard to Washington, D.C., asserting federal control over the city’s police, it marked a troubling advance towards authoritarianism in America. This action followed a previous deployment in Los Angeles, with Trump framing the takeover as a necessary step to restore “law and order” in what he described as “one of the most dangerous cities anywhere in the world.” At the heart of his rationale lay a curious claim: his “natural instinct as a real estate person” made him uniquely qualified to tackle urban crime and homelessness.
This admission reveals a significant connection between Trump’s past as a property developer and his governance style, rooted deeply in the political landscape of 1980s New York City. As we prepare for a potential showdown between Trumpism and the burgeoning democratic socialist movement led by Zohran Mamdani—who is poised to become the city’s next mayor—this link becomes increasingly relevant. Mamdani’s platform, which seeks to challenge the disproportionate influence of the real estate sector that nurtured Trump’s rise, signifies a potentially seismic shift in New York’s political economy.
The fiscal crisis that struck New York City in the 1970s was a turning point, catalyzed by a series of political and economic changes that eroded the post-World War II liberal order. As white middle-class families fled to the suburbs and economic resources shifted to the Sunbelt and Global South, the city struggled to generate sufficient tax revenue to support its well-established social programs. By late 1974, amid a global recession, institutional investors, tired of supporting the city’s mounting municipal debt, ceased their investments, pushing New York toward insolvency. The Ford administration’s refusal to provide a bailout forced the city into a painful agreement with New York State to stave off bankruptcy.
Unfortunately, this pact came with severe costs, disproportionately affecting working-class Black and brown residents, who were often scapegoated for the crisis. In exchange for financial assistance, New York City surrendered significant control over its governance and accepted stringent austerity measures. Thousands of city workers lost their jobs, wages were frozen, social services were slashed, and public transportation fares were increased. In the wake of this crisis, property values plummeted, particularly in marginalized neighborhoods where landlords found it more profitable to abandon or even destroy their properties rather than maintain them. In the mid-1970s, the Bronx faced a staggering average of 40 fires per night, resulting in the loss of around 80 percent of the South Bronx’s housing stock.
Yet, as the adage goes, every crisis presents an opportunity. The near-bankruptcy of New York City allowed elites to impose discipline on a restless working class and reshape the political economy to favor market-oriented policies. Samuel Stein, a geographer, describes what emerged during this period as the “real estate state,” a paradigm where land and everything on it became commodities, property rights were deemed sacred, and a robust real estate market was viewed as a hallmark of a healthy city.
This backdrop is critical to understanding the formation of Trumpism. Leveraging wealth from his father’s real estate empire in the outer boroughs, Trump began acquiring Manhattan properties shortly after the city emerged from its fiscal crisis. His first major development, Trump Tower, broke ground in 1979 and was completed in 1983. He continued to expand his real estate portfolio, engaging in notorious casino deals in Atlantic City. A 2018 investigation by the New York Times revealed that Trump’s wealth was significantly bolstered by a combination of tax evasion, governmental favors, and lax regulatory standards—an accumulation of riches that traced back to his father’s real estate dealings.
Trump’s ascent was also marked by the pervasive racism that has long permeated the real estate industry. In 1973, the Justice Department sued Trump and his father under the Fair Housing Act for discrimination against Black and Puerto Rican tenants. Years later, they faced accusations of steering minority tenants towards buildings already occupied by people of color, perpetuating segregated living conditions.
Beyond his real estate practices, Trump absorbed the prevailing racist and law-and-order sentiments of the post-crisis era. In 1989, he took out a full-page advertisement in the New York Times, calling for the death penalty for the Central Park Five, a group of Black and Latino men wrongfully convicted of a crime. Even after their exoneration, Trump refused to retract or apologize for his incendiary statements.
This trajectory from Trump’s real estate exploits to his wielding of state power showcases a continuity with the elites who reshaped New York after its fiscal crisis. In the lead-up to the 2016 election, Trump capitalized on a crisis of legitimacy borne from the 2008 financial collapse, one that left working people abandoned by both major parties. Like a real estate mogul intent on dismantling burdensome regulations, Trump aggressively sought to dismantle the administrative state—implementing drastic cuts to federal agencies and slashing public benefits for the underprivileged. His administration’s hallmark achievement was the upward transfer of wealth through massive tax breaks for the affluent, mirroring the strategies his family used to accumulate their real estate fortune.
As Trump continues to threaten federal funding cuts and tout the potential deployment of the National Guard to “straighten out New York,” he faces a formidable opponent in Mamdani, whose democratic socialist vision for the city includes policies such as rent freezes, free public transportation, a public grocery option, and expanded universal childcare. His recent primary victory over Andrew Cuomo, energized by a grassroots army of over 40,000 volunteers, was hailed as a triumph of the people over money—an encouraging sign for those advocating for change.
Mamdani’s potential leadership poses a legitimate threat to the elites who have thrived under the neoliberal order established in the wake of the 1970s crisis. His campaign aims to dismantle the austere, market-driven political framework that has empowered real estate interests at the expense of tenants and workers, challenging the very core of property value worship and aggressive policing that define the current political landscape.
In essence, the impending clash between Trump and Mamdani represents much more than a local political battle; it symbolizes a broader struggle over competing visions for society. Although the outcomes will resonate nationally, the fight will play out against the unique backdrop of New York City, setting the stage for a transformative moment in American political history.
