Remembering Hugh Carey, the Man Who Saved New York’s Transit System

Governor Hugh Carey speaking at a 1975 press conference. To his left are Ed Koch and Richard Ravitch, who would later rebuild the transit system as head of the MTA. Photo: New York State Archives ##http://www.wagner.edu/wagnermagazine/?p=606##via Wagner College.##

Hugh Carey, governor of New York from 1975 to 1982, died yesterday at the age of 92. Even in an office held by the likes of Al Smith, Franklin Roosevelt, Nelson Rockefeller and Mario Cuomo, Carey was a giant; Mayor Ed Koch, who served at the same time as Carey, called him the greatest governor of the modern era.

The 56th and current governor of New York, Andrew Cuomo, holds Carey in particularly high regard. Seeing Carey’s stewardship of the state through the fiscal crisis of the 1970s as a model, Cuomo sent copies of the recently-published biography of Carey, The Man Who Saved New York, to labor leaders across the state last December.

As New York honors the former governor today, the state would do well to look back on a piece of Carey’s legacy that he considered one of his proudest: his successful partnership with Richard Ravitch, whom he appointed to run the MTA, to save New York City’s transit system.

In January of 1982, just after announcing that he would not seek reelection, Carey told the New York Times that the voters would have judged his accomplishments worthy of a third term had he wanted one. As evidence, Carey pointed to his transit policies.

“Who would believe,” Carey said, “that a state that couldn’t get to market, a city that couldn’t get to market, where we couldn’t even get $750 million to keep the city afloat and alive in 1975, in one night’s work, in one program alone, could launch the program for the capital improvement of the subways of $8 billion in 1981. You don’t get there by accident.”

Indeed, the city’s safe, clean and widely-used transit system was the result of a purposeful, hard-fought effort by Carey and his administration to re-invest in the subways, buses and trains after decades of neglect.

In 1979, after the worst of New York City’s fiscal crisis had passed but while the city and state still endured a period of harsh austerity, Carey proposed a state bond issue that provided nearly $800 million for transit. “Investments in public transportation were never better advised,” said Carey at the time. Unlike the bonds being proposed for the MTA today, these were not backed by transit riders’ fares but by state tax revenue.

In March of 1981, Carey put forward another plan to fund mass transit. In addition to fare-backed bonds, he called for a minimum annual appropriation from the state and exemptions from various state regulations for the transit authority. A panel he put together and supported called for increasing the sales tax in the MTA service area and using a statewide tax on oil companies to further fund transit. When the state legislature, acting without the governor, passed a variant on his panel’s plan that Carey deemed would not sufficiently fund the MTA, he vetoed it. The legislature “failed to resolve the critical financial problems of mass transit,” Carey wrote at the time.

Carey voiced support for transit not only in the halls of Albany but in the press as well. “We all agree that our metropolitan transit system is in crisis,” Carey wrote to the New York Times in June, 1981. “The problems are visible in service deterioration, increasing costs, rising fear of crime by the ridership and intolerable delays. Even with these difficult problems, the M.T.A. is both a necessary and a valuable system that perhaps has been taken for granted too long.”

By 1982, the MTA was in trouble again. The package of state taxes that had been put together the previous year was coming up short while the Reagan administration slashed federal support for transit.

Carey put forward a plan to rework the tax package to bridge the gap. The legislature rejected it. But by the end of the year, a Carey-supported bill that installed a new tax on corporate profits downstate was passed.

Over a two-year period Carey and the legislature had put together a set of dedicated funding streams that by 2006 were providing nearly $1.7 billion a year for downstate transit. These are the same funds from which Albany has stolen $260 million over the last two years.

Seymour Lachman and Robert Polner, the authors of The Man Who Saved New York, also deemed Carey’s support for transit one of the great successes of his administration. “It became a huge economic development program,” they wrote, “since the subways are crucial to the city’s economic vitality.”

Carey’s support for transit, however, wasn’t continued by his successors in office. When Carey left office, the state contributed $1.5 billion to the MTA’s five-year capital plan. Mario Cuomo cut that all the way to zero by 1992. George Pataki used the dedicated taxes set up by Carey, meant to be new revenues, to pay for a prior state commitment to match local contributions to the MTA. Because of Pataki’s fiscal sleight of hand, between $161 and $186 million that Carey’s legislation had set aside for transit disappeared each year.

Hugh Carey proved that even during an age of budget cuts, New York State cannot afford to stop investing in its transit system. Thirty years later, the man who sits at his desk and mails out copies of his biography has yet to show he’ll apply the lessons that Carey imparted.

  • Thank you Noah. This is a wonderful article that needed to be written. I was furious when I read the quotes coming from Cuomo’s office following the death of former Governor Carey. He cherry picked a convenient few accomplishments (mostly budget cuts) and ignored his dedication to transit and his strong leadership used to raise taxes during a recession.

  • Carolyn Konheim

    Hugh Carey was no “transit giant” as governor.  The rescue of NYC’s horrendously deteriorated transit system was accomplished more in spite of him than due to any leadership on his part. If anything, he was the beneficiary of the stewardship through the city’s fiscal crisis in the 1970s of Felix Rohatyn, an investment lawyer and advocate of transit financing through bridge tolls and gas taxes.  In 1976, a week-long series in the NY Times excoriated the Governor for failing to carry out a federally adopted Clean Air Act Transportation Control Plan for NYC, approved by the prior governor and mayor, which mandated adequate funding for transit, by bridge tolls if necessary. In 1977, Carey joined his fellow Brooklynites in Congress, in support of amending the Clean Air Plan to guarantee transit funds in exchange for barring tolls on East River bridges. 
    Soon after, Richard Ravich, an outspoken business leader, took up the campaign for restoring transit with a well defined 5-year program funded by bonding and by management reforms.  In 1979, he was appointed by Carey to chair the MTA and he brought in David Gunn, the unsung hero who really overhauled the bus and subway system. During this time, Carey allowed but did not join Ravich to win over the Legislature and media to his plan.  Ultimately, one of the biggest infusions of federal funds came from the trade-in of Westway in 1984. 
    The irony of crediting Carey for this crucial infusion of transit funding is that Carey campaigned against Westway when he ran for Governor, thus winning the endorsement of Political Action for Clean Air, founded in 1974 in reaction to the refusal of the NYC Mayor Beame to carry out the City’s Clean Air Plan.  However, once in office, he was persuaded to adopt the State transportation commissioner’s secret strategy publicly supporting Westway in order to convince federal officials to maximize funding for Westway and then, once approved, to trade in Westway funds for transit financing and a low cost highway.
     I know these things because I was privy to all these strategies. One of them was as Regional Director of the Department of Environmental Conservation which had issued an evaluation of alternatives to Westway and advised Governor Carey not to be too harsh on the lowest cost roadway (essentially what we have today) because one day he might  need it.  For that message I was summarily discharged by the Governor, perhaps to reinforce the request for a more costly highway to a skeptical USDOT.  As a parting shot, I managed to arrange an evidentiary hearing on the new State and City application for a revised Westway project. The result of the hearing            was to reject a second time a federal permit for construction.  After further environmental litigation that exposed dishonest reporting, the State was eventually forced to trade-in Westway or lose more than $2 billion in federal funding.
     

  • Marty Goodman

    Mr. Kazis,

    Was it Mario Cuomo or George Pataki who cut all capital funding to the MTA? I always heard that it was Pataki.

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