Guest commentary by David McAllister

Philadelphia faces a fiscal crisis today, one that Mayor Nutter has said can be solved only with significant spending cuts.  This is, of course, not the first time the city has had a budget deficit.  Less than twenty years ago, money simply ran out leaving city departments unable to make payroll, buy supplies or provide many community services.  Things were so bad that the mail room at the Municipal Services Building ran out of stamps, and the Police Department had a mobile police station repossessed.  By early 1993, with a new mayoral administration and many sacrifices, equilibrium returned to the budget.

But that crisis was solved in the midst of growing national economy.  How will the current administration find solvency when many economists are predicting even more housing foreclosures, job cuts, and bankruptcies?  On the cusp of an economic collapse the worst since the Great Depression, it seems wise to look back to the 1930s to see how the city dealt with the crisis.  If history is our guide, the administration should be judicious and extremely cautious in cutting essential social services.

The budgetary catastrophe the city faced after 1929 was caused by decreased tax revenue that stemmed from the bankruptcy of many employers and the foreclosure of many homes.  At the worst point just before Franklin Roosevelt took office in 1933, when the city’s unemployment rate stood at 46 percent and the Sheriff had foreclosed over 23,000 homes the previous year, the National Municipal League described the city’s finances as “chaotic” and necessitating massive “budgetary curtailments and emergency measures.” Nearly all social services were cut at a time when residents needed them most.  The city, for example, could no longer afford to give refuge to the homeless and instead pushed them into an unused warehouse at the Baldwin Locomotives Works that the company had lent to the city for free, while thousands of others encamped at Franklin Square.  The city refused to aid the hungry or contribute to soup kitchens, leading a commentator in the Nation to conclude that in Philadelphia only “the poor are taking care of the poor.”

It took federal intervention to address the social calamity that the city could no longer handle.  Newly created agencies bought foreclosed mortgages, built homeless shelters, provided welfare assistance, and created jobs.  And even with this assistance, the city was still desperately short of funds - contemplating in late 1938 the sale of Independence Hall to the federal government for $25 million.

In comparison to the cuts during the Depression, the closure of some library branches, fire stations and swimming pools (among other cuts) is a moderate, responsible tact to fix the budget.  But if the economy worsens and the finances of the city deteriorate even further, what services then will be on the chopping block?  In the Depression, the city ignored the needs of its residents with horrifying consequences.  Today, with many residents smarting from the economic downturn already, is it wise to take away resources?  And is it good precedent?  These services exist, in part, to help residents through bad times.  If they are gone when they are needed, where will people turn?  Let’s hope history is not our guide.

David McAllister teaches history at Ursinus College.  He also updates the It’s Our City Community Calendar

Image credit: B Tal via Flickr