NEW YORK’S 1970S ‘SAVIOUR’ CAREY DIES
By ALAN RAPPEPORT
Hugh Carey, the governor of New York who steered the state through the hard winters of severe financial turmoil in the 1970s, died on Sunday. He was 92.
Carey, a two-term Democrat who had also worked in Congress, is widely revered as New York’s saviour, making difficult spending cuts at a time when New York City was mired in a mix of crime and crumbling public services and faced default. Known for tough love, he told New Yorkers in his inauguration speech that their days of wine and roses were done.
“The city’s finances were spiralling out of control and the expanding crisis threatened the fiscal stability of the state and the nation,” said Andrew Cuomo, New York’s current governor. “Governor Carey faced this challenge with tenacity and a conviction that gave New Yorkers hope that government could lead our state through the crisis.”
Carey was born in New York’s Brooklyn neighbourhood during the Great Depression, fought in the second world war and was elected to the US House of Representatives in 1960. He served seven terms before becoming governor.
At that time, New York City was facing a $5bn deficit and banks had cut its credit. As budget problems worsened, the city was eventually within hours of having to declare bankruptcy. With the US economy stumbling and the country deeply engaged in the Vietnam war, political leaders feared that such a default could destabilise the world economy.
Carey took aggressive action to regain control of New York’s finances, created an agency headed by Felix Rohatyn, an investment banker at Lazard Freres, to sell bonds, and orchestrated a government rescue to avert default. With the weight of the situation bearing down, he convinced banks to refinance the city’s debts, persuaded stubborn unions to make concessions and pushed President Gerald Ford to have a change of heart and offer New York City the loan guarantees it desperately needed.
“The Man Who Saved New York,” Carey’s biography, describes him as one of the state’s most effective yet least appreciated governors. Beyond his fiscal heroics, Carey was among the first to reform the state court system, brought environmental issues into national focus and rehabilitated New York City’s subway system.
However, the steps he took to revive the ailing US financial centre remain his crowning achievement. On leaving office in 1982, Carey told The New York Times: “The objectives I set forth I have achieved in terms of a state that is respected fiscally, a city that is now well on its way back to concrete foundations.”
Michael Bloomberg, mayor of New York City, said that Carey set the stage for the city’s rebirth.
“His strong and determined leadership, and his ability to bring people together to fix the most difficult problems, saved New York City during one of the toughest times in our history,” Mr Bloomberg said.
Financial Times (London, U.K.) (8/8/11)
August 12, 2011
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