Empire on the Hudson

EMPIRE ON THE HUDSON

The Columbia History of Urban Life kenneth t. jackson, general editor

The Columbia History of Urban Life Kenneth T. Jackson, General Editor Deborah Dash Moore, At Home in America: Second Generation New York Jews 1981 Edward K. Spann, The New Metropolis: New York City, 1840–1857 1981 Matthew Edel, Elliott D. Sclar, and Daniel Luria, Shaky Palaces: Homeownership and Social Mobility in Boston’s Suburbanization 1984 Steven J. Ross, Workers on the Edge: Work, Leisure, and Politics in Industrializing Cincinnati, 1788–1890 1985 Andrew Lees, Cities Perceived: Urban Society in European and American Thought, 1820–1940 1985 R. J. R. Kirkby, Urbanization in China: Town and Country in a Developing Economy, 1949–2000 a.d. 1985 Judith Ann Trolander, Professionalism and Social Change: From the Settlement House Movement to Neighborhood Centers, 1886 to the Present 1987 Marc A. Weiss, The Rise of the Community Builders: The American Real Estate Industry and Urban Land Planning 1987 Jacqueline Leavitt and Susan Saegert, From Abandonment to Hope: CommunityHouseholds in Harlem 1990 Richard Plunz, A History of Housing in New York City: Dwelling Type and Social Change in the American Metropolis 1990 David Hamer, New Towns in the New World: Images and Perceptions of the NineteenthCentury Urban Frontier 1990 Andrew Heinze, Adapting to Abundance: Jewish Immigrants, Mass Consumption, and the Search for American Identity 1990 Chris McNickle, To Be Mayor of New York: Ethnic Politics in the City 1993 Clay McShane, Down the Asphalt Path: The Automobile and the American City 1994 Clarence Taylor, The Black Churches of Brooklyn 1994 Frederick Binder and David Reimers, “All the Nations Under Heaven”: A Racial and Ethnic History of New York City 1995 Clarence Taylor, Knocking at Our Own Door: Milton A. Galamison and the Struggle to Integrate New York City Schools 1997 Andrew S. Dolkart, Morningside Heights: A History of Its Architecture and Development 1998 Craig Steven Wilder, A Covenant with Color: Race and Social Power in Brooklyn 2000 A Scott Henderson, Housing and the Democratic Ideal 2000

EMPIRE

ON THE HUDSON Entrepreneurial Vision and Political Power at the

PORT OF NEW YORK AUTHORITY

Jameson W. Doig

Columbia University Press, New York

Columbia University Press Publishers Since 1893 New York Chichester, West Sussex Copyright © 2001 Columbia University Press All rights reserved Library of Congress Cataloging-in-Publication Data Doig, Jameson W. Empire on the Hudson : entrepreneurial vision and political power at the Port of New York Authority / Jameson W. Doig p. cm.—The Columbia history of urban life Includes bibliographical references and index. ISBN 0-231-07676-2 (cloth : acid-free paper) 0-231-07677-0 (pbk. : acid-free paper) 1. Port Authority of New York and New Jersey—History. 2. Harbors—New York (State)—New York—History—20th century. 3. Harbors—New Jersey—History—20th century. 4. Harbors—Economic aspects—New York (State)—New York History—20th century. 5. Harbors—Economic aspects—New Jersey—History—20th century. HE554.N5 D65 2000 386.1/09747/1 21 00-031609 Casebound editions of Columbia University Press books are printed on permanent and durable acid-free paper. Printed in the United States of America c 10 9 8 7 6 5 4 3 2 1 p 10 9 8 7 6 5 4 3 2 1 credits All the maps have been prepared by J. Wayman Williams for use in this book and are owned by the author. The background for maps 2-1, 3-1, 4-1, 4-3, 4-4, 5-1, 5-3, 6-1, and 11-1 is taken from the MapArt City Series (www.map-art.com), courtesy of Cartesia Software, Lambertville, NJ 08530. Maps 2-2, 4-2, 5-2, and 14-1 are based on drawings owned by the Port Authority of New York and New Jersey, and are used with the permission of the Port Authority. Figure 11-2 is used with the permission of the New York Post (NYP Holdings, Inc). In the photo insert, photo 1 is reproduced courtesy of the South Street Seaport Museum, New York City. Photos 10 and 20 are used with permission of the New Jersey State Archives. Photo 13 is courtesy of Scientific American (June 4, 1921 issue). For photos 18, 19, 22, and 31, I am indebted to Margot Ammann Durrer. Stacy Tobin Carmichael and Farley Tobin have granted permission to use photos 40–45 and 52, as well as 86–89. Photos 58, 59, and 60 are used courtesy of the Special Archive, Triborough Bridge and Tunnel Authority. Photo 69 is used courtesy of AMR Corporation; photo 70 courtesy of the Auburn University Archives; and photo 71 with the permission of Pan American World Airways Records, Archives and Special Collections, University of Miami. All other photographs and illustrations are reproduced with the permission of the Port Authority of New York and New Jersey.

To Joan, with love, and with thanks for 48 years of companionship

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Contents

list of illustrations in the text ix elected and appointed officials: years in office xi foreword xv preface: Hopes and Judgments xix chapter 1. A Wilsonian Hybrid The Powers of Government and the Spirit of Capitalism 1

PART ONE. CREATING A NEW INSTITUTION chapter 2. The Tensions and Opportunities of Federalism Commercial Conflict in the New York Region 27 chapter 3. Designing a New Organization An Uneasy Marriage of Planning and Politics 47

PART TWO. FAILURE AND A NEW BEGINNING chapter 4. Modernizing the Rail System Contending Strategies for an Expanding Metropolis 77 chapter 5. Negotiating with the Railroads Regional Planning Confronts the Wary Capitalist 97 chapter 6. Politics and Engineering Passion Expanding the Port Authority’s Dreams 120 chapter 7. A Web of Bridges, Tunnels, and Political Intrigue 143

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PART THREE. DRIFT AND THE SOURCES OF RENEWAL chapter 8. Near Bankruptcy and the Loss of Vision 181 chapter 9. Federalism as a Lawyers’ Playground 192 chapter 10. The Threat to Municipal Bonds as Danger and Opportunity 214

PART FOUR. EXPANDING EMPIRE chapter 11. To Claim the Skies and the Seas 247 chapter 12. Breaking an Airline Monopoly 288 chapter 13. More Than “A Humdrum Job of Engineering” Creating a Giant Bus Station in Manhattan 315

PART FIVE. CONCLUSIONS chapter 14. A Regional Empire in American Politics Local History and Its Impact, Leadership Strategies, and Ethical Dilemmas 359 epilogue: Triumphs and Travails of an Aging Empire 373

appendix: the port compact of 1921 403 notes 411 acknowledgments 555 index 561 photo insert appears after page 200.

List of Illustrations in the Text

2-1.

Main waterways, inner counties, and important cities in the New York–New Jersey region 29

2-2.

Rail lines in the New York region, 1920 36

3-1.

The Port of New York District 70

4-1.

The Narrows Tunnel plan (1920s) 82

4-2.

Lindenthal’s 57th Street Bridge (1920 ff.) 83

4-3.

New Jersey’s maritime cities, existing and potential 87

4-4.

The Port of New York Authority’s rail-freight plan (1920s) 91

5-1.

The Port Authority rail-freight plan 105

5-2.

Belt 13, with associated piers and railroad links 107

5-3.

The three New Jersey–Staten Island bridges and the Holland Tunnel 113

6-1.

Proposed bridges and tunnels across the Hudson River 135

10-1. Cartoon: Julius Henry Cohen and Austin Tobin 223 11-1.

Airports and marine terminals in the New York region (1940s) 253

11-2.

Cartoon: a creative solution to the air traffic problem 275

11-3.

Cartoon: Austin Tobin and Meyer Ellenstein 283

13-1.

Eight bus stations vs. Union bus terminal 318

13-2. Proposed ramps and overpasses, Lincoln Tunnel to the bus terminal 319 14-1.

The Port Authority in 1950: bridges, tunnels, airports, bus and truck terminals 360

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Elected and Appointed Officials, with Years in Office

New Jersey—Governors Woodrow Wilson, 1911–13 James F. Fielder, 1914–17 Walter E. Edge, 1917–19 Edward I. Edwards, 1920–23 George S. Silzer, 1923–26 A. Harry Moore, 1926–29 Morgan F. Larson, 1929–32 A. Harry Moore, 1932–35 Harold G. Hoffman, 1935–38 A. Harry Moore, 1938–41

Charles Edison, 1941–44 Walter E. Edge, 1944–47 Alfred E. Driscoll, 1947–54 Robert B. Meyner, 1954–62 Richard J. Hughes, 1962–70 William T. Cahill, 1970–74 Brendan T. Byrne, 1974–82 Thomas H. Kean, 1982–90 James J. Florio, 1990–94 Christine Todd Whitman, 1994–

New York State—Governors John A. Dix, 1911–12 William Sulzer, 1913 Martin Glynn, acting, 1913–14 Charles S. Whitman, 1915–18 Alfred E. Smith, 1919–20 Nathan L. Miller, 1921–22 Alfred E. Smith, 1923–28 Franklin D. Roosevelt, 1929–32

Herbert H. Lehman, 1933–42 Thomas E. Dewey, 1943–54 Averell Harriman, 1955–58 Nelson A. Rockefeller, 1959–73 Malcolm Wilson, 1973–74 Hugh J. Carey, 1975–82 Mario M. Cuomo, 1983–94 George E. Pataki, 1995–

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officials

New York City—Mayors William Jay Gaynor, 1910–13 John Purroy Mitchel, 1914–17 John F. Hylan, 1918–25 James J. Walker, 1926–32 John P. O’Brien, 1933 Fiorello H. LaGuardia, 1934–45 William O’Dwyer, 1946–50

Vincent R. Impelliteri, 1950–53 Robert F. Wagner, Jr., 1954–65 John V. Lindsay, 1966–73 Abraham D. Beame, 1974–77 Edward I. Koch, 1978–89 David N. Dinkins, 1990–93 Rudolph W. Giuliani, 1994–

Port Authority Commissioners (selected) Eugenius H. Outerbridge, NY 1921–24 (chairman, 1921–24) Alfred E. Smith, NY 1921–23 John F. Galvin, NY 1923–33 (chairman, 1928–33) Julian Gregory, NJ 1923–26 (chairman, 1924–26) Frank C. Ferguson, NJ 1924–45 (chairman, 1934–45) George S. Silzer, NJ 1926–28 (chairman, 1926–28) Howard S. Cullman, NY 1927–69 (chairman, 1945–55) Alexander J. Shamberg, NY 1930–41 Joseph M. Byrne, Jr., NJ 1934–53 (vice chairman, 1945–53) Charles S. Whitman, NY 1935–42 John Borg, NJ 1938–45, 1948–53 Bayard F. Pope, NY 1944–55, 1959–67 Donald V. Lowe, NJ 1945–69 (chairman, 1955–59) S. Sloan Colt, NY 1946–68 (chairman, 1959–68) James C. Kellogg, III, NJ 1955–80 (chairman, 1968–74) William J. Ronan, NY 1967–90 (chairman, 1974–77) Alan Sagner, NJ 1974–86 (chairman, 1977–85) Robert F. Wagner, Jr., NY 1976–91 Philip Kaltenbacher, NJ 1982–93 (chairman, 1985–90) Richard C. Leone, NJ 1988–94 (chairman, 1990–94) Kathleen A. Donovan, NJ 1994– (chairperson, 1994–95) Lewis M. Eisenberg, NJ, 1994– (chairman, 1995–)

officials

Port Authority Staff Members (selected) Julian Henry Cohen, General Counsel, 1921–42 John E. Ramsey, 1921–42; CEO, 1926–30; General Manager, 1930–42 B. F. Cresson, Jr., Chief Engineer, 1921–23 W. W. Drinker, 1921–27; Chief Engineer, 1923–26 Walter P. Hedden, 1922–52; Director of Port Development, 1942–52 Othmar H. Ammann, 1925–39; Chief Engineer, 1928–39 Austin J. Tobin, 1927–72; Executive Director, 1942–72 Lee K. Jaffe, Director of Public Relations, 1944–65 Peter C. Goldmark, Jr., Executive Director, 1977–85 Stephen Berger, Executive Director, 1986–90 Stanley Brezenoff, Executive Director, 1990–95 George J. Marlin, Executive Director, 1995–97 Robert E. Boyle, Executive Director, 1997–

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Foreword

Kenneth T. Jackson

N

ew York City owes its location, its growth, its prosperity, and even its very existence, to its port. It is a natural site for a transportation break, for an entrepot of incredible variety, and for a great city. Indeed, the southern tip of present-day Manhattan was already a centuries-old trading post in 1524, when Giovanni da Verrazano, an Italian in the employ of France, became the first known European to sail into the magnificent bay. Located at the point where the Hudson and Passaic Rivers mingle with the waters of the Atlantic Ocean and Long Island Sound, the harbor is the finest in the western hemisphere and is usually ice-free in all seasons. In 1609, Henry Hudson sailed into the Upper Bay and soon reported to his Dutch employers that the natives were friendly, that the river was broad, and that the climate was moderate. Thus encouraged, the Dutch established a fort there in 1624 and made it the center of their trading operations in North America. In 1664, the English took the city away from the Dutch and renamed it New York. In the centuries ahead, the cornerstone of Gotham’s growth was commerce, and the backbone of its economy long remained at the water’s edge, from which the settlement expanded and waxed rich. Soon after the winning of American independence in 1783, New York began to surpass its major rivals. By 1789, it was the leading city in the coasting trade, and ten years later it had surpassed all its competitors in tonnage and in the value of both exports and imports. Its protected waterways were ideal for ocean-going vessels, and for smaller boats, whose number swelled after the Erie Canal opened in 1825. Between the Civil War and 1960, when Rotterdam overtook it, the Port of New York usually ranked as the world’s busiest, and it typically handled more goods and passengers than Boston, Philadelphia, and Baltimore combined. Even experienced seamen were awed by the vast traffic of tramp steamers, sailing vessels, barges, ferries, and warships which jockeyed for position in its crowded waters. Meanwhile, behind the docks stretched acres of warehouses, storage tanks, coal dumps, sugar mills, breweries, and dry docks. In the late nineteenth and early twentieth centuries, xv

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the vast harbor was responsible for hundreds of thousands of jobs and billions of dollars in commerce. By 1920, the port was, however, in decline. Its problems became evident during World War I, when freight trains destined for New York backed up as far as Pennsylvania because of congestion and overcrowding in the harbor. One problem was that the ramshackle docks and piers were simply unable to handle the modern vessels that lined up along the Hudson and East Rivers. Another difficulty was the very geography that had made Gotham prosperous. In 1920, for example, 90 percent of the docking facilities were located in New York City, but most railroads terminated in New Jersey. The irony bordered on the incredible: The world’s busiest harbor was not designed for direct rail–water shipment. Boxcars had to be loaded on and off barges, which shuffled back and forth across the Hudson River and New York Bay. This added to the cost of doing business in the metropolitan region. Meanwhile, competing ports were constructing modern terminal facilities and garnering an increasing share of the nation’s maritime trade. In 1921, in response to these and related problems, the states of New York and New Jersey undertook a cooperative effort to create an institution unlike anything ever before seen in the United States. To be known as the Port of New York Authority, it would improve terminals and associated transportation facilities in the great harbor and be empowered to issue bonds and to charge fees for its services. During the next several decades, it became a huge enterprise and constructed bridges, tunnels, airports, bus terminals, and office operations of almost unparalleled size. Along the way, it became the model for hundreds of similar quasi-governmental institutions across the land, such as the Tennessee Valley Authority (TVA), which together changed the face of a giant nation. Empire on the Hudson, then, is a big book about a big topic and represents a major contribution to our understanding of several broad themes that have been crucial in American history and politics. First, it is about the political, economic, and physical transformation of the first metropolitan region in the world to reach a population of fifteen million. Second, Empire on the Hudson examines the tensions between the demands that government be efficient and effective and that it be responsive to the wishes of the electorate. Third, Empire on the Hudson is unusual in its focus on individuals—Austin Tobin, the lawyer who rose from a marginal position in the Port Authority to become its executive director and the real “power broker” in the bi-state region; and also Julius Henry Cohen, the attorney who more than anyone else made the Authority a paragon of Progressivism, and Othmar H. Ammann, the brilliant

foreword

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Swiss engineer who was responsible for the George Washington Bridge, the Bayonne Bridge, and the Verrazano-Narrows Bridge. Finally, Empire on the Hudson offers persuasive evidence that a writer can examine and analyze even the most complex urban institutions without adopting a prose style that is full of jargon and unreadable sentences. Jameson Doig writes in a fashion that both entertains readers and respects their intelligence. One important contribution of this volume is to recall us to a time when Americans had confidence that government could confront great problems with imagination and decisiveness and that bureaucracies could be at once honest, effective, and competent. Indeed, the Port Authority, in Doig’s view, was founded as the very embodiment of the Progressive approach to politics— that is, to rely on experts, to insulate them from the narrow interests and patronage needs of elected office-holders, and to give them the power to get things done. As Robert Fishman has remarked, “Now that governments seem paralyzed in confronting problems far less complex than reorganizing the Port of New York, it is well to be reminded of a faith in government and in the future that once moved mountains, or at least built bridges and tunnels.” No one other than Jameson Doig could have written this book. A respected scholar and a prodigious researcher who is familiar with the best social science literature and who has devoted most of a long and distinguished career to examining the challenges and crises of the modern metropolis, he has written a tour-de-force that will remain for generations the definitive study of this major institution. It is an important contribution as well to our general understanding of the role of government in modern society—and of the conditions under which governments can act to meet important social problems, and with what benefits and costs.

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Preface

Hopes and Judgments

The States recognize that a wise co-operation is . . . imperative in the common interest . . . but they lack the means, the instrumentalities that would serve them in their new community of action. —Woodrow Wilson, Governor of New Jersey, “An Address to the Conference of Governors,” Nov. 29, 1910; in Arthur S. Link et al., The Papers of Woodrow Wilson, volume 22, pp. 104-105. The Port of New York Authority is authorized and directed to proceed with the development of the Port of New York . . . and is vested with all necessary and appropriate powers . . . except the power to levy taxes. —Julius Henry Cohen, counsel to the Port of New York Authority, “Developing the Port of New York,” address before the National Rivers and Harbors Congress, Dec. 22, 1922, p. 9. The Port Authority . . . is in fact one of the most interesting and potentially one of the most formidable political agencies America has yet produced. — Archibald Macleish, “Port of New York Authority,” Fortune, Sept., 1933, p.119. We are proud of the work that we have accomplished through this bi-state agency. . . . What I would like to stress more than the physical accomplishments . . . is what has been accomplished in the way of the restoration of faith in our representative system of government, our working Federalism. —Alfred E. Driscoll, governor of New Jersey, as quoted in the Port of New York Authority, Annual Report for 1951, p. 6. Some special-district governments have so much power that they dominate the social and economic life of an entire region. The Port Authority of New York and New Jersey exemplifies this domination. . . . Once appointed, its members are almost beyond removal and are thoroughly insulated from popular control. —Lawrence J. R. Herson and John M. Boland, The Urban Web (Chicago: Nelson-Hall, 1990, p. 254).

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T

he creation of this “most interesting” agency, its evolution during its first several decades, and the significance of that history for our understanding of politics in the United States are explored in the fourteen chapters below. An Epilogue provides a critical review of the agency’s evolution since its heyday in mid-century. Jameson W. Doig May 2000

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EMPIRE ON THE HUDSON

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1 A Wilsonian Hybrid The Powers of Government and the Spirit of Capitalism

F

rom lakes and streams high in the Adirondack Mountains, the river named for Henry Hudson flows south for 300 miles, past Schuylerville, and Troy, and Albany, and then, on its east bank, past Dutchess County and Putnam and Westchester—all cities and counties of New York State. And now, less than twenty miles from the Atlantic Ocean, New Jersey bustles forward, and occupies the west bank, and demands to be recognized as joint owner of the Lower Hudson and of all the commercial opportunity of the great New York Bay. To this smaller state, its demand for recognition is a matter of economic necessity, of political sovereignty. Above all, perhaps, it is a matter of pride. Like other great waterways in the United States and abroad—the Nile, the Tennessee, and San Francisco Bay, for example—the Hudson River and her associated streams and inlets have long been a prime source of commercial activity and economic growth for shore and hinterland, and the arena also of political conflict among the states and cities in its environs. In these regions too we find creative efforts to fashion new instruments of government to meet economic and social needs: a Tennessee Valley Authority; semi-independent port authorities in San Francisco and Oakland; development agencies along the Nile; and the Port of New York Authority—as it was known until 1972, when the bi-state agency was retitled the Port Authority of New York and New Jersey, in deference to that smaller state’s political power and sensitivities. Now close to its eightieth birthday, the Port Authority is one of the oldest and largest of the world’s specialized regional governments. Created in 1921 at the urging of business and political leaders on both sides of the Hudson, the Port of New York Authority would, its founders hoped, replace conflict with cooperative effort in the region’s search for economic growth on and near its 800 miles of waterfront. Because of opposition from politicians in both states, however, the Authority was given very little formal power, and for several years it floundered in the muddy waters of New York Bay and local politics. Yet 1

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within a decade of its creation the Port Authority had evolved from an agency of vague and toothless charter into a vigorous engine of economic vitality—a public organization both marvelous and disturbing to behold. Marvelous, because it had accomplished great feats of engineering and carried them forward under a banner of interstate cooperation, with unexpected speed and without direct burden to the taxpayer. Yet disquieting, when measured by important American values, because the new agency avoided close democratic controls and symbolized—indeed endorsed, showed the benefits of—efficiency as a goal, a goal that might best be achieved if democracy in its usual forms were put “on hold.” To those who compared its striking achievements with the faltering efforts of other governmental bodies, the Port Authority’s success seemed to flow from its independence of local politics, its stated ideology of “businesslike efficiency,” and the competence and public spirit of the men and women who were attracted to an agency with these distinctive characteristics. Franklin Roosevelt emphasized these themes in 1931, when he saluted the Port Authority for completing the George Washington Bridge ahead of schedule and “at a cost well below the original estimate.” “To my mind,” FDR concluded, “this type of disinterested and capable service is a model for government agencies throughout the land. Their methods are charting the course toward the more able and honorable administration of affairs of government—a course they have proved can be safely steered through political waters with intelligence and integrity at the helm.”1 With Roosevelt’s backing, the Port Authority became a partial model for the Tennessee Valley Authority, created in 1933, and the model for the hundreds of semi-independent public authorities constructed by American state and local governments in the 1930s. Its design and experience were crucial influences on Robert Moses, as he developed an array of public authorities in the 1930s and 1940s. Its strategy for financial independence—issuing revenue bonds rather than relying on legislative funding or voter-approved bonds—was adopted by major public-works agencies in the West, turning them into independent authorities in fact if not in name. The continued successes of the Port Authority also made it an important prototype for the several thousand public authorities created in the United States and other nations since the end of World War II.2 This is the story of how Democracy was put “on hold” in the New York metropolis—of how the passion for greater efficiency in transportation and for rapid economic growth, combined with some antipathy toward local political leaders, led state officials and civic leaders to drop their democratic

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guard and yield responsibility for an important part of their destiny to an agency insulated from direct popular control. It was a yielding that occurred incrementally: First there was a study commission, followed by a modest agency with a duty to survey and recommend; then there were small bridges that might be built, followed by a larger span, and plans for a freight building tucked away in lower Manhattan. Soon the Port Authority expanded its domain by wresting control of the Holland Tunnel from the competing agency that had constructed it; and then a second tunnel was needed, and soon approved. Later there were municipal airports that had to be modernized, and decaying piers that might be rescued from long neglect at the hands of city officials, and large terminals that should be constructed for trucks and interstate buses, so the Port Authority argued, in order to permit the region’s transportation system to operate more efficiently. And it is a story of how this bi-state agency was able to exploit widespread desires for economic growth, together with concerns about the abuses and inefficiencies often found in local politics, to turn wary state officials into loyal allies, and to overcome opposition from local citizen groups and elected leaders, gaining their support or sending them down to defeat. In the chapters below, I concentrate on the early conflicts that led to the creation of the Port Authority in 1921 and the three decades that followed. These were crucial years, filled with strife and with decisions that set the Port Authority firmly on its long-term course. In this period, the agency steadily broadened its mission—expanding from rail-freight planning to gather in a wider and wider range of tasks, becoming the nation’s first multipurpose regional authority. By 1950, most of the activities which would absorb the Port Authority’s energies through the rest of the twentieth century were underway. Led by the George Washington Bridge, and the Holland and Lincoln tunnels, its bridges and tunnels were generating large toll revenues for the Authority; the Port agency had a dominant role in air transportation, with its airports at Newark, LaGuardia, Teterboro, and Idlewild (Kennedy); its inland rail-freight terminal was operating and two truck terminals had been completed; Newark’s marine terminal, which would be the cornerstone for its continuing activities in maritime transport, was a thriving Port Authority enterprise; and at the end of the year its gigantic bus terminal opened its doors in mid-Manhattan. In proposing, constructing and expanding these enterprises, the Port Authority frequently had to grapple with opposition—from elected officials in New York City and Newark, and from their legislative representatives at the state capitals; from railroad and bus company executives; from Robert Moses

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and his allies in the region and at Albany; from residents and business groups opposed to the disruption or competition the agency’s programs would bring. While confronting the hurdles placed in its path by these opponents, the Port Authority developed and honed a variety of “entrepreneurial skills” and overcame many (though not all) of its opponents. Even Robert Caro’s famous anti-hero, Robert Moses, was driven into defeat when he sought to block two major Port Authority programs. By 1950 the Authority had fulfilled Archibald Macleish’s prediction: it had indeed become “one of the most formidable political agencies America has yet produced.”3 Most of the agency’s energies were employed within the bi-state region. But on two occasions it reached out to lead campaigns which directly shaped national policies: when it fought successfully, in the 1930s and 1940s, against the plans of Franklin Roosevelt and the Internal Revenue Service to tax municipal bonds; and when its leaders led a campaign, in the late 1940s, to organize the nation’s airport operators and challenge the monopoly strategies of the major U.S. airlines. These regional and national events and themes are examined in this volume. Certainly the Port Authority’s evolution since 1950 is not devoid of interest or importance. In the 1950s, the agency constructed a third tube at the Lincoln Tunnel, and worked on a plan which led to an expanded regional highway system, including a lower deck on the George Washington Bridge. In the 1950s and 1960s, it expanded the Newark marine terminal and turned the enterprise into a large containerport; and it also took control of piers in Hoboken and Brooklyn. Its executives fought to gain approval for a new jetport in New Jersey; and they fought to avoid taking on rail transit projects but finally agreed to buy and operate an important interstate line (now known as PATH). In the 1960s and 1970s, the Port agency built the World Trade Center, a second bus station near the George Washington Bridge, and a bus/rail terminal in Jersey City. More recently, it has constructed modest industrial parks in the South Bronx, Yonkers, and Elizabeth, N.J., built a satellite communications center (the Teleport) on Staten Island, and constructed the Newark Legal Center and a waste disposal facility in Essex County. Except for the failed effort to build a fourth jetport and the agency’s rail transit forays, none of projects of the past forty years has involved complex political conflicts on a scale with the battles analyzed in the chapters below. Also, with the exception of the Newark expansion into a large containerport, none of the more recent projects has shaped the region’s development as significantly as those whose political story was essentially settled by mid-century.

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By these measures, then, 1950 is a reasonable point at which to close the main analysis in this volume. An Epilogue offers a compressed history of the past five decades, and some judgments on the lessons of that history and prospects for the future. The evolution of the Port Authority during the first half of this century illustrates basic themes and tensions in American politics, and the next section of chapter 1 reviews the Port Authority story in relation to this wider context. The chapter then outlines the general perspective on leadership and political accountability which is central to organizing the materials in the chapters below.

Government Without Politics: The Heroic Search Four general themes of American political development are exemplified by the Port Authority story: the recurring effort to construct “nonpolitical” agencies of government, whose activities would be shaped mainly by expert analysis and a passion for efficiency; a public willingness to encourage and applaud vigorous executive action by government officials, when such action appears necessary to overcome the extensive fragmentation of the American political system and to meet important social problems; a partially contradictory tendency to rely on the incentive systems of capitalism and individual self-interest for economic development, with government programs designed mainly as handmaidens to these market forces; and a widely felt optimism that however complex and daunting the problem, the American people and the American political and social system could marshal the energies and inventiveness needed to find an elegant solution. Well, perhaps not always elegant; but all important societal problems could and in time would be solved! As to whether those four themes can be joined to form a clear and parsimonious explanation of American political development—this may be doubted. Their sometimes divergent paths suggest S. E. Morison’s interpretation of “the American character,” which he found “so complex . . . that the excess of one quality was balanced by the excess of its reverse.”4 At the Port Authority, these four horses were maintained in harmonious tension through most of the decades of our story. Only occasionally did an undue emphasis on one quality or another send the Port Authority tumbling, as it scrambled over the rocks which economic interests and political opponents scattered in its path.

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The Demand for Efficiency and Energy In designing and then operating the new agency, its creators and executives could draw on political ideas that were prominent in the first years of the twentieth century. For the Port Authority was an offspring of the Progressive Movement, as that movement evolved during the years before the United States entered the First World War. Its origins and history illustrate two major themes particularly well. The first was the campaign of the early reformers— which had begun in the decades just after the Civil War and extended into the Progressive years of 1900–1916—to eliminate political corruption and obtain honest, efficient, “businesslike” government. One of their goals was the creation of career civil-service systems in national, state, and local governments; and some reformers also favored multiheaded regulatory commissions, whose members would be appointed for fixed, overlapping terms on a nonpartisan basis, and would be able, it was hoped, “to make decisions on the basis of expert knowledge and impartial judgment.” Their campaigns often met with success; by 1916, civil-service laws and new independent regulatory bodies dotted the American landscape. With these changes, the reformers imagined, government programs would be effectively insulated from narrow political pressures and political expediency.5 For some Progressives, honest and efficient government was not enough. They also sought an expansion of governmental activity, in order to achieve a better society. This theme was embodied in the political campaigns and programs of Theodore Roosevelt and Woodrow Wilson, and urged by some of the movement’s leading writers. Herbert Croly’s influential book, The Promise of American Life, developed these views at length and called attention to the future role of state governments, which, Croly argued, should engage in a “continual process of experimentation.”6 Wilson was also a proponent of vigorous activity by the states, and as governor of New Jersey in 1911–13, he undertook a wide-ranging program of innovation. Moreover, Wilson’s public statements in this period emphasized several Progressive themes that would be crucial in the bi-state reform efforts a decade later: He argued that each state must “try its own vital experiments” without waiting upon the “slow and cumbrous movement” of the national government; he noted the great advantage of cooperative action among states and in interstate regions, and the need to create “instrumentalities that would serve [the states] in their new community of action”; and he advocated clear, centralized responsibility for programs carried forward by local and state governments. It was time, Wilson argued, for the reformers to extend

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their vision beyond the “mere elimination” of patronage and the spoils system, and to urge that the principles of “business administration” be applied to government, rendering its efforts more effective.7 During his two years as New Jersey’s governor, Wilson also drew attention to issues of transportation and economic development that would be important in the creation of the Port Authority a decade later. He predicted vast expansion in national and world commerce, and he argued that “every harbor of consequence must be repaired and united with each other.” Wilson pointed to the need for great improvements in the Port of New York, and he urged that New Jersey take the lead in meeting this challenge.8 These concerns of the reformer—that government programs should be efficient and nonpolitical, that governmental action should be vigorous and experimental—would shape the world of rhetoric, and ofttimes of reality, at the future Port Authority.

To Aid Capitalism and Individualism Equally important in the birth pangs of the new agency, and in its activities in subsequent decades, is a cluster of quite different themes long prominent in American culture—the importance of capitalism, of individualism, and of intense competition as crucial to personal achievement and a healthy society.9 The primary support for creating a semi-autonomous regional authority in the New York region came from leaders in the business world, who hoped that the new agency would be able to overcome political and geographic obstacles which, in their view, depressed the opportunities for commercial expansion and profits.10 These concerns also generated active business support for the Port Authority’s early plans, which would aid commercial vitality and individual mobility by building rail and marine terminals and constructing new bridges and tunnels. The same economic-development goals—together with a desire to reduce “government inefficiency”—motivated business leaders in the 1940s and beyond, as they applauded Port Authority proposals to take control of the region’s airports and its marine terminals, displacing city operations in Newark, Hoboken, and New York City. For similar reasons, the publishers and editors of New York’s influential daily newspapers usually endorsed the Port agency’s plans and programs. Throughout these decades, the competitive challenge that faced the New York metropolis—from Philadelphia, Boston, and other regions which tried to divert shipping and industry to their shores—was a powerful motivator for action, both within the Port Authority staff and among its strong supporters in the business world.11

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The debate over whether a regional enterprise of this sort should be created, and the subsequent conflicts surrounding its efforts to take control of marine terminals and airports from local politicos, brought to the fore a major theme of modern capitalism: a desire to reduce the influence of small-scale neighborhood and community concerns in shaping government’s activities in the economy, and to operate government programs according to “rationallegal values”—that is, with a primary focus on efficiency, and an intolerance toward patronage and other traditional uses of government power and funds. Inevitably, pressures to create and make use of a regional agency, insulated from local political controls, would raise the question of whether adequate safeguards—to ensure “democratic accountability”—could be maintained. This concern has always been part of the Port Authority’s history.12 The Port Authority’s activities are also closely associated with the American belief in individualism, especially as that trait is illustrated in the restless urge for geographic mobility—for individual choice in travel patterns and in place of residence.13 One of the Authority’s first projects, the George Washington Bridge, opened northeastern New Jersey to a wave of suburbanization by New York office workers in the late 1920s; and the Lincoln and Holland Tunnels also contributed to the westward search for homes in the years before and after World War II. The Manhattan Bus Terminal, built in 1950, increased the attractiveness of suburban living for those willing to travel by bus to their jobs in New York City; and the airports emphasized individual mobility and commercial efficiency as twin goals to be celebrated, and from which profits—for the region’s businesses, and for the Port Authority—could be extracted.

The Faith in Rational Planning Finally, to its creators and its champions in the business world and beyond, the Port Authority idea was stamped with the Progressives’ coin of optimism. As Arthur Link and Richard McCormick point out, the wide range of reforms in the Progressive arsenal “reflected their faith in progress—in mankind’s ability, through purposeful action, to improve the environment and the conditions of life.” The Port Compact evolved out of this general attitude toward the human condition, which was, perhaps, embraced with special enthusiasm by professionals in the New York region.14 Within the Port Authority, the same faith that progress could be achieved through rational planning—to which systematic political strategies could then be harnessed—grew large and endured through most of its first three

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decades. This positive view was reinforced by evidence in these years that faith could be borne out in works: Overcoming large engineering and political obstacles, the wide Hudson River was at last conquered by the world’s longest spanning bridge; in Newark, a decaying seaport was extracted from the clutches of patronage and marvelously revived; jealous cities yielded up their favored offspring—the airports of Newark and New York City—against the promise of efficient planning and modernization; and after long political battles, an immense airfield was created from grassland in outer Queens. Moreover, the Port Authority’s commissioners, though often from a background of active politics, were generally persuaded to avoid making narrow patronage demands; in fact, the commissioners often entered the fray to defend the Port Authority’s independence from patronage and political opportunism. And despite the lure of larger corporate salaries, the agency found it could attract and retain planners, program directors and legal strategists of high quality—men and women who were ready to employ their skills in grappling with complex problems that reached across engineering, urban planning, finance and politics in this large and challenging interstate region. For a time, during the Depression years of the 1930s, the commissioners and some executives did seem to lose their way; but “incubators” out in the field—in the Port Authority’s planning bureau and in the law department— then produced men and women and new ideas that would soon revitalize the agency and propel it into the expansion years of the 1940s. The energetic optimism of the Port Authority’s creators and many of its officials was nourished by their perception that their bi-state agency filled a crucial niche in this large metropolis, and that its plans would ultimately win wide support. Pendleton Herring captures important elements of this perspective as it was held by the agency’s executives: “A democracy inclines toward chaos rather than toward order,” Herring wrote; “the representative principle, if logically followed, leads to infinite diversity rather than ultimate unity.” Therefore “the impulse for positive political action must be deliberately imposed at some strategic point, if democracy is to succeed as a form of government.”15 To the leaders of the Port Authority—as they faced the chaotic political structure of two states and the region’s hundreds of cities and towns—their agency embodied that essential “impulse for positive political action.” Moreover, the projects that they sought to carry out often required longrange planning, and actions that would yield positive results only after many years. Even those elected officials who wished to achieve these same goals often could not afford to give them high priority; they would need to show

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accomplishments before the next political campaign. So the Port Authority, with its insulated decisionmaking and funding sources, again filled a crucial niche when long-term capital investment and planning was needed. At times, certainly, other interests with “narrower” views—or simply with different views—formed coalitions that could defeat the Port agency’s rational schemes. But those defeats might be only temporary; careful analysis, continuing efforts to educate the region’s publics and their leaders, and the building of complex alliances would often bring victory—perhaps in months, perhaps in years, and on occasion a decade or more after the planners had proposed ways to meet a challenging problem. Sometimes, as we will see, the Port Authority’s optimism was misplaced; but often, beyond the expectations of its friends who gave up hope, its efforts were rewarded with success.

The Course of the Story The events analyzed in the chapters below can be briefly summarized. Chapter 2 reviews the history of conflicts between New York’s economic and political leaders and their counterparts in New Jersey, regarding the use and misuse of the waterways that both divide and join them. These concerns largely centered on the question of whether benefits and burdens were being unfairly distributed, as shipping and associated economic activities expanded in New York Bay and along adjacent rivers and harbors. In 1916 New Jersey filed a legal challenge, aimed at increasing commercial development west of the Hudson, at some possible cost to New York’s own economic well-being. The two states then created a joint commission to explore ways out of the escalating political and legal conflict; and the commission turned to its counsel, Julius Henry Cohen, in the hope he could devise a cooperative solution. In 1918 Cohen put his proposal on the table: he favored creating a powerful bi-state agency, which would both regulate and encourage development guided by a “comprehensive” plan, throughout a Port District extending across all the waterways and dozens of cities in the New York-New Jersey metropolis. In Chapter 3, we follow that proposal as it confronted the American political system, with its suspicious local officials and wary state legislators. Cohen’s design was largely dismantled during the years 1918–21, and a powerful engine of rational economic development was transformed into a nearly empty shell, called “The Port of New York Authority,” which saw the light of day in April 1921.

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The new agency was given a very general mission—to enhance cooperative planning in the bi-state region, and a specific mandate—to develop and implement a plan to improve the region’s rail-freight system; but it was provided with little power or funds to carry out that plan. Chapters 4 and 5 describe the Port Authority’s efforts to devise the railroad plan and to obtain agreement from the rail corporations. For ten years the agency struggled to win over the rail officials to its preferred program; but by 1931, no real progress had been made toward that goal, and the “comprehensive” railroad scheme was essentially abandoned. The rail executives’ vision of competitive capitalism, which gave little weight to cooperative planning, had won out. The failure of its railroad program might have spelled the end of the Port Authority, had the agency been designed narrowly as an instrument to rationalize the rail system. But its creators had constructed it quite differently—as a sort of empty vessel, into which various ideas for interstate cooperation on transportation issues might be tossed, and allowed to incubate. And so it became a target of opportunity, and an object of affection, for individuals and groups in the surrounding communities—and inside the agency—who saw the Port Authority as an instrument to use in achieving their own goals.16 The open character of the Port Authority’s mandate also meant that its activities could be reshaped to fit modest and even radical changes in technology: As automobiles and trucks challenged railroad dominance in freight and passenger transport, as interstate buses began to congregate on Manhattan’s narrow streets, and as airplanes attracted travelers and freight, the Port Authority might reach out and take a leading role in improving each new facet of the region’s transport system. But only if the Port Authority’s leaders had the vision and the Machiavellian skill to seize the opportunity, and to construct alliances with regional and national groups which might benefit from new Authority projects. The scheme to rationalize the railroad system was still trudging slowly toward its unhappy ending when the new drama—of the Port agency as flexible vehicle of regional expansion—had its first stirrings; these developments are set out in chapters 6 and 7. The story began with an assault on the Port Authority’s limited role as instrument of the railroad era, a challenge led by an independent engineer, Othmar Ammann. Ammann organized a public campaign to expand the Authority’s horizons, and by 1925 the agency had agreed to construct four large bridges for motor vehicles; these new ventures would soon stamp it as a leading player in the automotive age. During the

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next several years, the agency fended off political pressures that threatened to undermine the engineering integrity of its bridge-building; and its officials also moved adroitly to neutralize the threat from another bi-state group, the independent Holland Tunnel commissioners. By 1931, where chapter 7 closes, the Port Authority had completed the George Washington Bridge and three bridges to Staten Island, the money-making Holland Tunnel was under its control, and the bi-state agency was celebrated (to quote Franklin Roosevelt) as a model of “skill and scientific planning” in action.17 The Port Authority was lionized, and its success shaped the conception of the TVA and the string of local housing authorities established across the country in the 1930s; but even as its reputation rose, the agency itself faltered and went adrift. The Depression cut its toll revenue sharply; a conservative banker from Jersey City took the helm; Ammann’s famous engineering department was dismantled; retrenchment was the order of the day. By 1941, one careful study concluded, the Port Authority was on “dead center”; it seemed to be “frightened by the specter of controversy,” and its approach to the region’s problems was “receptive rather than aggressive.”18 This sad but instructive tale is told in chapter 8. Now, however, the pressure for change emerged from within the Port agency itself. The intellectual center for thinking about new Port Authority projects was in the planning bureau; but the motivation and strategic calculations needed to challenge the conservatives in the central office arose in the law department, where the leading role was taken by a young real-estate attorney, Austin Tobin. In chapters 9 and 10, Tobin’s early history and activities at the Port Authority are summarized, and we then follow the campaign in the late 1930s, led by Tobin, to challenge Franklin Roosevelt on the issue of tax exemption for municipal bonds and to create a nationwide coalition that ultimately defeated the president. Tobin emerged as the embodiment of a new “entrepreneurial spirit” for the sleepy agency; and in the spring of 1942, the Port Authority’s governing board chose him as executive director, despite the opposition of the chairman, Frank Ferguson, who held on to the agency’s executive power. The battle lines were soon drawn, and (as we will see in the first part of chapter 11) Tobin joined forces with the agency’s own planners to develop a range of possible new programs for the Port agency, while battling the antiSemitism and other tactics Ferguson employed to attack Tobin’s aides and his ideas. Tobin then constructed an alliance with the “progressive” forces on the governing board who, with a valuable assist from New Jersey’s governor, forced the chairman out of office early in 1945.

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After the internal battle had ended, the Port Authority’s governing commission and its staff achieved a state of harmony that would endure for more than a decade. Led by Tobin, the Authority team devised analytical and political strategies which would permit them to expand beyond the “bridge and tunnel outfit” which the agency had been for twenty years. They targeted the major airports of the New York region—which might be brought under the Authority’s control, if the elected officials of Newark and New York City could be persuaded to part with these symbols of municipal pride. The decaying piers of Newark, Hoboken, and New York City should, they thought, be added to the Authority’s domain and modernized to meet postwar needs. The thousands of North Jersey buses which flowed through the Lincoln Tunnel and clogged Manhattan roadways could be removed from city streets and brought directly into a gigantic new terminal. The efficiency of the region’s truck traffic could be greatly enhanced by creating union terminals in Newark and Manhattan; so the planners argued. Rail services in the bi-state region might also be improved. To accomplish these tasks, the Port Authority would require the support of newspapers, business leaders, elected officials, and the average citizen in the cities and towns on both sides of the Hudson—who would need to be educated regarding the advantages of “regionalism,” and the great drawbacks of old-time political machines and local parochialism. Chapters 11, 12, and 13 describe the strategies through which Tobin and his aides identified a preferred array of regional projects, grappled with resistance from local officials and some business executives, and devised strategies to reeducate or defeat those who did not share their vision of efficient regional development. By the close of 1950, the Port Authority had largely emerged victorious. New York’s two major airports had been extracted from city control— and from the grasp of Robert Moses. Newark’s airport had been added, to give the bi-state agency direct responsibility for all of the region’s major air terminals. A national coalition, to challenge the airlines’ monopoly over landing fees and other charges and to help modernize airport management, had been created and had scored its first victories. Newark had yielded up its harbor and piers to the Port agency; but New York City and Hoboken still resisted Tobin’s entreaties. Two regional truck terminals were in place; and, despite the opposition of Commissioner Moses, the world’s largest bus terminal was in operation, removing more than 2,000 buses a day from congested Manhattan streets. By mid-century, then, the Port Authority had become an interstate agency with crucial planning and operating responsibilities in the fields of

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air, land and marine transportation in the nation’s largest metropolis. An institution criticized by some for its independence of local control, yet praised by the governors of both states and by business leaders, and emulated at home and abroad.

Leadership and the Biographical Perspective In the early pages of this chapter, I identified several broad themes in American political history, which were exemplified in the creation of the Port of New York Authority, and which helped to shape the Port Authority’s rhetoric and its behavior in its first three decades and beyond. In this final section, I want to highlight three perspectives which have seemed to me especially important in thinking about this organization and about the behavior of political institutions generally. The first is the importance of leadership in shaping an agency’s origins and its activities; the second is the advantage of a biographical perspective in analyzing the nature of leadership in complex organizations and policy arenas; and the third is the challenge of public accountability in a democratic society.

The Role of Leadership The Port Authority was an offspring of the Progressive Era, as I noted earlier, and of the efforts in those years to insulate government agencies from patronage and other narrow political pressures, and to encourage efficiency in public programs, sometimes coupled with designing new initiatives as well. But insulation, efficiency, and new programs are not achieved simply through the enthusiasm of business leaders and other hopeful citizens. Attaining these goals requires skilled and sustained public leadership. In his writings in the late nineteenth century, Woodrow Wilson explored this issue, which he framed in a way that underscores the close linkage between the quality of leadership and the kinds of Progressive reform illustrated in the Port Authority’s history. Efficient, honest operation of government programs, Wilson argued, can be attained best—perhaps can be attained only—under three interlocking conditions: if those programs are insulated from the vagaries of party politics and patronage; if very able men and women can then be attracted to shape and direct such programs; and if these leaders are given clear-cut responsibility for action, and “large powers and unhampered discretion” in carrying out their duties. In fact, Wilson argued in his 1887 essay, only if agency lead-

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ers are given clear responsibility and wide discretion is it likely that we can attract to government service those individuals with the talents and energy needed to meet complex economic and social problems. Wilson warned against the opposite tendency—to distribute power widely in the hope of ensuring democratic accountability. If power is “dealt out in shares to many, it is obscured,” he argued, “and if it be obscured, it is made irresponsible.” As Wilson commented in concluding this line of analysis: “If to keep his office a man must achieve open and honest success, and if at the same time he feels himself entrusted with large freedom of discretion, the greater his power the less likely is he to abuse it, the more is he nerved and sobered and elevated by it.”19 Wilson’s way of framing the problem of leadership draws our attention to several issues which are important in analyzing any complex organization and crucial in this study. The history of American public institutions is littered with examples of power divided and obscured, precluding effective and responsible leadership: the Interstate Commerce Commission through most of its 100 years, for instance, as well as many other federal and state regulatory commissions; the Port of San Francisco and some other multiheaded public authorities in the 1960s and 1970s; NASA, with its stumbling efforts on the space shuttle in the 1980s; the embarrassing misadventures of the savingsand-loan regulators in the 1980s and beyond. In some of these agencies, one also finds illustrations of other Wilsonian concerns—the use of patronage in making appointments, the awarding of contracts based on political criteria, and the easy bending of policy to narrow political demands, all of which weaken the structure of responsible leadership and drive away able people who prefer to be judged by their professional competence.20 In organizations which succumb to these political pressures, the capacity of the enterprise and its executives to make significant contributions to society is likely to be undermined. Moreover, the working life of an individual caught in the web of political favoritism and expediency is not likely to be a source of personal pride; a job in that environment will often contribute little to one’s sense of self-esteem, or one’s sense of contributing to a broader purpose. The best will leave; the others will hunker down, unhappy, or embrace the political virus as it infects the agency. Maintaining clear-cut responsibility is, therefore, a crucial element of professional leadership. But there are other important dimensions too—especially when a leader, or leadership team, wishes to take the organization in novel directions, creating new programs or devising innovative administrative strategies. Such executives can be called “entrepreneurial leaders,” and

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their leadership task can be examined in relation to six important dimensions. To what extent, and how, do they: (1) identify new missions and implementation strategies for the organization; (2) develop and nourish external constituencies to support the new goals and programs, and to support the organization generally, while neutralizing existing and potential opposition; (3) create internal constituencies that support the new goals (while overcoming internal resistance), through changes in organizational structures, in recruitment systems and key appointments, and in reward and penalty systems; (4) enhance the organization’s technical expertise (through recruitment of skilled personnel and addition of new equipment) in order to improve its capacity to identify and develop interesting program options, and to implement new goals and programs; (5) motivate and provide training for members of the organization so that they will have the skills to work efficiently in old and new program areas, and the desire to extend their efforts beyond standard levels of performance; and (6) systematically scan organizational routines, and points of internal and external pressure, in order to identify areas of vulnerability (to mismanagement and corruption, and to loss of the leaders’ own power and position), followed by remedial action.21 A major task of the chapters below is to analyze the efforts of the Port Authority’s leaders, as they used these six strategies in order to lead the Port Authority into new fields of activity during the agency’s first three decades. There we will explore the dynamics of entrepreneurial leadership; and we will consider the Port of New York Authority as an example of the possibilities for innovative programs inherent in a federal system.22

The Uses of Biography In analyzing the Port Authority’s origins and its expanding range, I will explore the activities of a number of governors, mayors, and other elected officials, the tactics used by a variety of organized groups and private corporations, and the efforts of a range of Port Authority officials. (The main participants, with their years in office, are listed at the front of the book.) However, three individuals emerge as preeminent in breathing life into the bi-state enterprise and giving it several decades of vigorous activity. To understand the values that shaped their behavior and the leadership strategies they employed, as well as their influence on the agency’s development, we

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need to reach back to the years before they attained high rank, and indeed before they were involved with the Authority at all. Then we will follow their evolving goals and strategies through their Port Authority years. So this study is in part a triple biography, of three men whose importance to the Port Authority and its influence in the New York region has been without parallel: Julius Henry Cohen, the agency’s general counsel for two decades; Othmar Ammann, the agency’s first bridge engineer; and Austin Tobin, who served as the Port Authority’s executive director for many years. The three together, and perhaps one or two of them individually, rank with the legendary Robert Moses—if one’s measure is the influence of an individual on the pattern of regional development in the New York metropolis. A biographical perspective may add significantly to our understanding of how and why government policies are created and altered. As Charles Goodsell points out, it can provide a “key to unraveling causality” in the pattern of complex human events. Biographical analysis can also offer insights into the ethical choices and tradeoffs that confront those in public life and suggest strategies that can be useful in resolving ethical dilemmas. And a biographical approach may underscore a point often lost to sight in the late twentieth century: that a sense of “dedication and commitment” to a mission can animate those in public life; a desire for monetary wealth and a “thirst for power” are not the only important forces that motivate the leaders of large organizations.23 In the case of the Port of New York Authority, a much-studied organization, it turns out that biographical probing of our three main characters adds new information on crucial aspects of the agency’s development, aiding us in understanding the policies adopted and the strategies used to surmount opposition, as well as the motivations that animated the agency’s leaders. Brief summaries suggest the importance of these three men in our wider story: Julius Henry Cohen was born in 1873 in lower Manhattan, son of a garment worker who was a member of the Tammany political machine. He attended law school at night and was active in the Progressive reform movement in New York City, 1900–1917. Cohen joined with Louis Brandeis in devising a compact between management and workers that ended a general strike in the garment industry in 1910, and he took a leading role in the creation of new business-arbitration systems in New York State, in 1915 and later years. At the request of the New York Chamber of Commerce and state officials, he devised a bi-state compact, based substantially on the principles of his earlier mediation efforts, to create the Port of New York Authority in 1921. Cohen then served as general counsel at the agency from 1921 until 1942. While at the Port Authority, in collaboration with Governor Alfred Smith (an

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ally in earlier reform campaigns in New York City), he constructed the legal arguments that established the Port Authority’s independence, and he devised the political strategies that permitted the agency to take control of the money-making Holland Tunnel, thus assuring the Port Authority’s long-term financial viability. Othmar H. Ammann was born in Switzerland in 1879, trained as a civil engineer, and came to the U.S. in 1904 in the hope of work in the bridgebuilding field. He was chief assistant to Gustav Lindenthal in constructing the Hell Gate Bridge, 1912–1917, and managed a clay pottery mine in 1917– 20, where he became acquainted with one of the mine’s investors, local politician George Silzer. Ammann returned to Lindenthal in 1920 to work on plans for a railroad-vehicular bridge across the Hudson River at 57th Street, and he left Lindenthal in 1923 over conflicts on bridge plans. He then organized local support for a Hudson River bridge at 179th Street and took a leading role, in alliance with Silzer (who had been elected New Jersey’s governor), in persuading the Port Authority to take on vehicular projects. He joined the Port Authority as bridge engineer in 1925, designed the George Washington Bridge and Bayonne Bridge, and supervised their construction as well as that of two other Staten Island bridges, 1925–1931, and the Lincoln Tunnel, 1934–1937. On loan part-time to Robert Moses’s Triborough Authority, he designed the Bronx-Whitestone Bridge and supervised the construction of that span and two other bridges. Ammann left the Port Authority when the engineering department was disbanded in 1939, and entered private practice; in the 1950s he designed the second deck of the George Washington Bridge and the Throgs Neck and Verrazano-Narrows spans. Austin J. Tobin was born in Brooklyn in 1903, son of an active member of the McCooey Democratic machine. He attended Catholic schools in Brooklyn, graduated from Holy Cross College in 1925 as salutatorian, and joined the Port Authority in 1927, while taking classes at Fordham law school at night. Tobin served as real estate attorney and as an assistant general counsel at the agency, 1928–1942. From his third-tier position at the Port Authority, he organized a national campaign to block President Roosevelt’s plan to tax municipal bonds. Tobin was appointed executive director of the Authority in 1942. For the next three years, he confronted opposition from influential members of the Port Authority board. Tobin consolidated his power in 1945 and led the Port Authority until he departed at the end of 1971. In probing the motivations and behavior of these three central characters, and of their associates, the observer is struck by the powerful streak of ration-

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ality that appears to shape their efforts. As we trace the evolution of this institution, we will follow men and women at the top of the Port Authority, and indeed salted throughout her ranks, who could grasp the structure of complex political and economic forces in the New York region, scrutinize them closely for weak points and for opportunities (where the bi-state agency might construct alliances or take separate initiative), and then plan and execute artful strategies to disarm the savage beast of (other) vested interests—while the Port octopus made off with a large tunnel, airports, and city docks and piers, and while it constructed bridges and tall buildings and other projects of possible benefit to itself and to the wider region. At times, the Port agency’s leaders also championed projects that only seemed attractive when aided by the visions of regional planning and the heat of battle, but which turned out to be of little real value. So rational calculation at the Port Authority, during the thirty years and more of this study, was not coldly clinical but rather laced with human aspiration, passion, and sometimes human failings. Joseph Schumpeter, in his classic analysis of the role of the private entrepreneur in economic development, identifies several motivations that enliven and modify the behavior of entrepreneurs as they succeed and fail in the world of business. All apply as well in the world of government—and especially in the world we enter in this volume: “First of all, there is the dream and the will to found a private kingdom. . . . “Then there is the will to conquer: the impulse to fight, to prove oneself superior to others, to succeed for the sake, not of the fruits of success, but of success itself. . . . “Finally, there is the joy of creating, of getting things done, or simply of exercising one’s energy and ingenuity. . . .”24

Lest this summary suggest that our entrepreneurial leaders were too narrowly self-interested, it should be noted that all three grappled with difficult moral issues during their years at the Port agency, and that on important occasions they embraced the more ethical course of action, even if it made their general task more difficult and put their careers at risk. We will see examples of these tensions and choices in Cohen’s resistance to possible graft by one of his board members, and to patronage in the law department; in Ammann’s fight to maintain the independence and integrity of the engineering department; and especially in Tobin’s conflict with the Authority’s chairman on the issue of anti-Semitism, his battle on behalf of small airlines

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against the monopoly tactics of their larger brethren, his efforts to aid those displaced by construction in Manhattan, and his resistance to awarding contracts to the politically influential. And we will see contrasts in the ethical stance of Tobin and his colleagues, compared with that of Robert Moses, as Moses is portrayed in Robert Caro’s The Power Broker. Drawing substantially on a biographical perspective, the chapters below explore the dreams and impulses to do battle of our three entrepreneurs and their associates, and the impact of their efforts in shaping the Port Authority’s policies and the development of the bi-state New York region.

The Challenge of Democratic Accountability In focusing on the role of leadership in “getting things done,” and on the activities of specific entrepreneurial leaders, I may appear to downplay the problem of accountability. However, that issue will be continuously before us, as text or subtext, throughout the volume. A few preliminary observations may be useful. The Port Authority was created in a society generally described as “democratic,” which has traditionally placed much emphasis on decentralization of governmental power—on the ability of the separate states, and their individual cities and towns, to determine their own priorities for public action and to act separately or cooperatively, as their citizens prefer. To create a governmental institution not directly accountable to the voters, or to elected officials, is in some sense to undercut this structure of democratic responsibility. So, in its initial design as an “insulated” agency of government, and in its subsequent behavior, the Port of New York Authority can be viewed as weakening the fabric of democracy. The same charge can be levied at its many insulated cousins—the Tennessee Valley Authority, the West Coast port agencies, the Newark Housing Authority, and now hundreds more.25 This concern regarding democratic control was, as we will see, crucial in the debate at the state capitals in 1918–1921 on whether the bi-state agency should be created, in the decision by New Jersey’s governor to veto the compact legislation, and in New York City’s effort in 1921 to block the compact via court suit. Throughout the 1920s and 1930s, New Jersey’s politicians raised one version of the banner of democratic accountability—the right of each state to act independently and competitively—in their recurring attempts to break free from the Port Authority’s philosophy of regionalism. And in the 1940s, political leaders in New York City and Newark employed the rhetoric

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of local control, as they fought against the Authority’s campaign to take charge of their airports and marine terminals. In response, those who admire organizations founded on the principle of insulation from politics frame the issue in this way: “Are different methods of accountability appropriate for distinct kinds of institutions?” Is public operation of an airport (for example) much like that of a public school, where active involvement of the local citizenry in shaping the curriculum and perhaps in setting standards for teacher qualification may be desirable? Or is an airport more like a manufacturing plant, where decisions on product lines, inputs, and price are determined by staff experts in marketing, engineering, and other special fields, and whose output is judged by customers when they decide use the service (or go elsewhere), not by the voting public? Those who have sought to insulate the Port of New York Authority and its cousins from political pressures respond to these questions by arguing, in effect, that a public authority—at least in the field of transportation and terminals—is more like a factory than a school. The decision on where to place an airport, and how large it should be, certainly should depend in part on the attitudes of elected officials and the region’s voters—with highway congestion, aircraft noise and other costs being debated in the public forum against the benefits of an airport at location X or Y. However, even on issues of location and size, technical factors and customer demand would be very important; and the advocate of insulation argues that other matters—how to construct the airport, bring aircraft in and out safely, route ground traffic inside the airport, and provide adequate security—should be decided mainly by experts, not by public vote, and certainly not by public officials based on promises made in the heat of an electoral campaign. In twentieth century America, this has not been a question simply of theoretical concern. Experience in the transport field has shown that airports and marine terminals which are directly accountable to elected officials have often become staffed with patronage appointees, whose decisions are shaped by the patron’s needs and other political pressures; and contracts for jobs large and small are handed out to firms with close ties to agency officials and the political party in power. At least, this was the conclusion that one could draw from the staffing and investment patterns in the years before World War I at New York City’s shipping terminals and piers, at Port Newark, and at the Port of San Francisco. These same patterns would frequently reappear at cityowned airfields as they were developed in the 1930s and 1940s.26 For Julius Henry Cohen and others who fought to create the Port of New York Authority and then to expand its role in the region, the lesson of this

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history seemed clear: If government was to have an effective role in improving transportation and thus aiding regional economic development, a specialized kind of public agency would be needed—an agency insulated first from the influence of local political officials (for example, Tammany in New York City and the Hague machine in New Jersey), and also from the sporadic political pressures state legislators and other influential politicos might bring. Such an agency, an “independent” public authority, would meet the test of democratic accountability mainly through its deeds—rather than via its sensitivity to immediate public clamor, coupled with sidebar payments to elected officials and their political friends. It would succeed, and be accountable, primarily through the speed with which it could develop far-seeing plans for the region’s development, the quality of those plans (as judged by experts and by the public), and its ability—once public support was obtained—to carry out agreed-upon plans efficiently; and by the quality of the results: Does the airport, the marine terminal, the bridge or tunnel system work effectively? These were the standards of accountability that the Port Authority’s staff, and its supporters in the media, the business world, and beyond, applied to the agency in its early decades. They are still central guideposts against which the Port agency, and a wide array of transportation and development agencies that now populate the American landscape, have measured their success and failings in more recent years.27 That perspective on accountability has been under recurrent challenge, from the early debates on whether to create a bi-state agency to the present. The critics of the “efficient and effective” school of responsibility do not dismiss the importance of effective action; rather, they would strip away some of the political insulation, so that the public and its elected officials can have more influence over what projects a public authority undertakes, and how it carries out its tasks. They do not argue that the quality of a project should be weakened in order to obtain greater democratic responsiveness; the failure of a bridge, or dangerous flight patterns at the airport, are not acceptable tradeoffs. The critics would, however, accept some delays in deciding on new programs and in completing large projects, so that broader public sentiments and values are given greater weight. They are inclined to be suspicious of “technocratic solutions to social problems,” and to argue that community “bargaining, as well as analysis and information,” are essential to providing public services. They would find ways to limit insulation in order to curb what Erwin Hargrove calls (in his recent study of TVA) the “unilateral adventurism” of public authority executives.28

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Criticisms of the New York-New Jersey port agency have been particularly sharp. Reviewing the Port Authority’s first several decades, Annmarie Walsh concluded that as it “achieved stable management and financial prestige, it sacrificed the perspectives of urban planning and local democracy.” In 1990, Herson and Boland found the agency’s commissioners “thoroughly insulated from popular control.” In 1995–96, the mayor of New York City adhered to a long tradition by criticizing the Port Authority for policies that benefit New Jersey “unfairly,” and urged that the agency be broken up, so his city could take responsibility for Kennedy and LaGuardia airports and perhaps other programs now operated by the bi-state agency. In 1997, New York State’s governor, George Pataki, sharply attacked the agency’s operations and suggested that perhaps it should be carved into several pieces.29 As we enter the twenty-first century, the question of whether government programs can be efficient and effective, while being responsive to public needs and influence, is a matter of widespread debate. The story of the Port Authority in its first several decades can offer valuable insights in understanding this issue and in suggesting strategies that might work. Here we find evidence that rational planning, effective action, and a due sensitivity for public concerns and public involvement can coexist. But it is an unsteady brew, requiring that supervising officials, in this case the two governors, demonstrate a kind of disciplined oversight—resisting the natural tendency of elected leaders to use the agency for short-term political gain, while at the same time actively monitoring the agency’s proposals in relation to the governors’ broad policy goals. These elected officials can offer support for “entrepreneurial leadership” that may yield important benefits, even as the agency skirts close to “unilateral adventurism.” An unsteady brew, certainly, but one that in fact existed, with advantage to the nation’s largest region, during much of the first half of the century just completed. It is a combination that has been lost in the New York metropolis in recent decades, but that might, if its benefits and risks are rightly understood, again reappear.

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Part One

Creating a New Institution

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2 The Tensions and Opportunities of Federalism Commercial Conflict in the New York Region

Lay down that old hostility Fostered between you since long, long ago. Turn on the real foe your common strength, Else heaven will at length Deny you the right to any force, Seeing that pious zeal in you has run its course. —N. Machiavelli, Carnival Songs

T

he year 1917 was a critical time in the long history of intermittent conflict and wary cooperation between New Jersey and New York State, and the most important individual in shaping the cooperative prospects for that year and for many years that followed was a lawyer of modest reputation, Julius Henry Cohen. When the year began, the two states were sharply divided, locked in a bitter conflict over railroad freight problems and over the conditions that might ensure—or jeopardize—economic prosperity throughout the bi-state New York region. New York City’s rise to the first rank of world cities, and much of the economic growth of the region that extended 25 miles and more beyond her borders, were crucially linked to international and coastal trade. With its rivers and bays extending into two states, the Port of New York could count nearly 800 miles of waterfront, dwarfing Boston with its 140, Philadelphia with 37, and Baltimore with 120. By 1915, nearly half of the nation’s international commerce—counting both export and import commodities— passed through the Port of New York, and a vast system of steamship lines and railroad companies converged on the harbor. More than 75 million tons a year were processed through a complex array of rail and marine terminals in both states, generating thousands of jobs directly tied to the transport system, and thousands more in retail commerce, home and office construction, and industrial development.1 27

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The economic benefits linked to vigorous international, coastal, and intraregional trade were not evenly distributed across the cities and towns of the metropolis, however, and there was a sharp contrast between the economic strength of New Jersey and her sister state. Manhattan was the dominant center for corporate decisionmaking and office activities associated with international commerce, and most of the thriving marine terminals were located along the shores of Manhattan and Brooklyn. On the western side of the Hudson River were hundreds of miles of rail track running across Northern New Jersey to large rail terminals on or near the Hudson shore in Jersey City, Hoboken, and smaller towns; but the modest economic vitality generated by the railroads and associated activities in New Jersey was far outstripped by the activity and impact on the New York side. It was not surprising that political and business leaders in New Jersey wondered if the existing pattern might be modified, to the benefit of the Western Provinces. A strategy that could attract major shipping lines to Jersey City, Hoboken, and Newark Bay, for example, would reward the Garden State, bringing new industries, more jobs, and residential growth. However, any strategy that threatened the existing commercial dominance of New York was sure to be met—from the Eastern side of the region—with cries of perfidy, and with strong defensive measures. And so it was, in the second decade of the twentieth century, that each side sought its own advantage, and volley and counter-volley roiled the waters of the wide Hudson. The immediate concern in 1916–17 was a conflict over the rates and costs that should be assigned for delivering freight to the two sides of the River. The traditional system treated the bi-state region as a single unit. The railroads would charge a manufacturer in Ohio, for instance, the same amount to ship goods to Europe whether they were sent via docks in Manhattan or at Jersey City. However, the cost to a railroad to carry those goods over to Manhattan piers (or to Brooklyn) was considerably higher; most of the railroads terminated their rail tracks on the Jersey shores of the Hudson, and they maintained an expensive system of ferries and large barges (called lighters) to float the goods across to New York City docks, where they could then be loaded on ships bound for abroad. In addition, Manhattan was congested, so that trucks and horse-drawn vehicles could carry goods to and from the piers only with great difficulty; this added to the real cost of freight transport on the New York side. In treating the New York–New Jersey region as a single zone in setting freight rates, therefore, the railroads actually neutralized the natural low-cost advantage of the New Jersey side of the harbor.2

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2-1. Main waterways, inner counties, and important cities in the New York– New Jersey region. (New York City includes the Bronx, Manhattan, Queens, Brooklyn, and Staten Island.) The Hudson River, the Kill van Kull, and the Arthur Kill serve as the boundaries of the two states.

The strategy the New Jersey interests decided to pursue had become focused by 1916 on this issue of “rate discrimination.” Jersey City, Hoboken, Newark, and Elizabeth filed a formal complaint with the Interstate Commerce Commission in May, arguing that the ICC should compel the railroads to charge lower rates for freight services to Northern New Jersey terminals. The state government in Trenton joined in the complaint.3

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East of the Hudson, public officials prepared for legal battle. It seemed clear that a victory for New Jersey in the New York Harbor case (as it was called) might be calamitous, leading to “an exodus of a very large amount of trade and commerce” from New York.4 However, some of New York’s business leaders could see that New Jersey’s challenge might also offer an opportunity—to reach beyond the direct issue in the suit and grapple with the inefficiencies, congestion, and high cost which had long burdened the Port, and which were, in fact, accurately portrayed in the New Jersey challenge. On this issue the initiative was taken by the Chamber of Commerce of the State of New York, which had a long history of campaigning for improvements in streets, docks, and other transport facilities, and for more centralized government power to ensure that such advances could be accomplished.5 Two officials of the New York Chamber, Eugenius Outerbridge and Irving Bush, had commercial interests which stretched across both sides of the Hudson, and they took the lead in seeking ways to pursue a complex strategy—one that would use the New Jersey suit as leverage to reshape the region’s freight delivery system, thereby increasing its efficiency, lowering the cost of food and other goods, and generating economic growth for the entire bi-state area. To devise a strategy that might attain these ends, Outerbridge and Bush turned to the Chamber’s legal counsel, Julius Henry Cohen.6

Odyssey of a Reformer In the summer of 1916, Cohen knew very little about the technical and political issues involved in freight delivery. But he could look back on two decades of personal experience in politics and political reform, and on several years of work—with Louis Brandeis and others—in devising ways to substitute cooperation for conflict in resolving business and labor disputes. This background would influence Cohen’s approach to the New York Harbor case and would shape the design of the first public authority in the United States. Moreover, since Cohen later worked with Governors Alfred E. Smith and Franklin D. Roosevelt in fashioning public authorities to grapple with problems of water power and housing, and since FDR carried these ideas and experiences from New York to the White House in 1933, Cohen’s thinking was a crucial part of the heritage that led to the creation of the Tennessee Valley Authority in 1933 and housing authorities across the country in the 1930s, and to the wide use of the authority as a governmental device after World War II.7

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Strategies for Social Progress: A Personal History Cohen was born in 1873, in Brooklyn. His family soon moved to lower Manhattan, where his father worked as a tailor and as captain of his Tammany Hall district, while Julius Henry was growing up.8 After graduating from public school, Cohen attended the Metropolis night law school in Manhattan, and he worked as a stenographer and law clerk during the day. He passed the bar examination in 1897 and then practiced law, while taking part in reform politics on the West Side. In 1904, Cohen was named chairman of the Legislative Committee of the reform-oriented Citizens Union; the committee’s role was to evaluate state legislation and monitor the performance of state legislators representing the city. Through his work with this committee during the next dozen years, Cohen became familiar with important political figures in the city and state.9 Early in his law career, Cohen also served as counsel for the garment industry, and in 1910 he and Louis D. Brandeis, who represented the garment laborers, worked out a “Protocol of Peace” which ended a major strike. The Protocol created worker-management boards to resolve future differences between the two sides, and thereby brought a measure of labor peace during the years 1910–1917. Meanwhile, in 1911 Cohen became general counsel for the New York State Chamber of Commerce, where he joined with business executives in developing a new system of arbitration to resolve local business disputes. And a few years later, Cohen took a leading role in the Bar Association’s efforts, jointly with the Chamber of Commerce, to develop state and national systems of commercial arbitration.10 Through these activities, Cohen had by 1916 developed a distinctive perspective on public policies and on ways to grapple with social conflict. He believed that governmental power should be used to meet important social problems, and that public programs should be developed and carried out mainly at the local and state level. Also, based on his experience with machine politics in New York City, he preferred that government programs be insulated from the vagaries and potential corruption of party politics. More generally, Cohen was a strong believer in finding ways to resolve disagreements through cooperation, and he thought that the route to a healthy economy would often be found in collaborative planning, rather than vigorous competition.11 As Cohen reviewed the history of economic growth in the region, and of conflict and cooperation between the two states, he found other historical lessons that bore on the 1916 case; and Cohen began to extract from

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these materials a strategy that could beat off the New Jersey challenge— and perhaps also win the antagonists on both sides of the Hudson to a common cause.12

Hazards of a Federal System: A Century of Experience Historically, the New York Harbor, though divided by a state line running through its waters, developed and flourished as a single port. This was evident, for example, in the impact of the Erie Canal, a 360-mile waterway that connected the Great Lakes to the Hudson River in 1825, providing a water route between the old Northwest and New York Harbor that was far superior to the continental links to Philadelphia and Baltimore. Foreign trade through the Port of New York then expanded rapidly, and both sides of the Harbor had benefited substantially. In Cohen’s reading, later trade expansion had aided New Jersey as well as New York, and if there were further improvements the benefits would again be widely felt across the bi-state region.13 But it was also clear that the state line had provided an inspiration for hostile thrusts across the Hudson. In the first years of the nineteenth century, Robert Fulton’s steamboat was granted a monopoly by the State of New York, covering the steamboat trade on the Hudson and all its shores. By 1810, Fulton’s boats carried passengers and goods between New York City and New Jersey, and New York State law prohibited steamboats licensed by New Jersey from competing for this thriving trade. When Trenton legislators retaliated in 1811 with a law penalizing New York steamboats, the level of hostility between the two states escalated. The issue finally reached the U. S. Supreme Court, and in the celebrated 1824 case, Gibbons v. Ogden, Chief Justice John Marshall affirmed the freedom of interstate commerce from state interference and held that New York had no power to grant a monopoly on navigable waters.14 That case did not end the controversy, however, for New York State still asserted that it had controlling authority in the entire harbor, and New Jersey sharply dissented. Finally, in 1833 the governors of the two states agreed to appoint study commissions which would work together in seeking a formula to resolve the controversy; within a year the commissions’ proposals were adopted as the Compact of 1834, which brought 75 years of peace between the states, and a vast expansion of trade and commercial development on both sides of the Hudson.15 From the 1834 Compact story, Cohen drew a lesson which would influence his own approach to the controversy of 1916–17: A long-term, stable so-

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lution for a regional problem might be achieved through joint action by the major parties, involving the creation of study commissions which could analyze the issues objectively and propose constructive mutual action. Such an agreement might then be sealed in perpetuity by a compact between the states, approved by the national government.16 The positive lesson of the 1834 Compact was combined, as Cohen reviewed the historical situation, with recent evidence of a more negative cast—but containing some interesting ideas that might be helpful in resolving the current conflict. One major example, productive of much heat but also a little light, was the controversy over water pollution. As population and industry expanded during the late nineteenth century, New York and New Jersey cities dumped increasing amounts of sewage into the Bay and the rivers that emptied into the Harbor. In 1903, New York State created a commission to examine ways to control water pollution, but New Jersey refused to cooperate; then, in 1908, New York brought suit to halt construction of a major sewer line in Northern New Jersey that would carry still more sewage into the Bay. In response, New Jersey argued that the pollution problem was caused largely by untreated waste from New York City’s outflow pipes. By 1916–17, this conflict had generated mountains of testimony and large legal fees, and the end was not yet in sight.17 Within this sad tale, however, there were still some nuggets which Cohen and his allies might use. An early report by the New York Commission, in 1905, had suggested that the pollution problem should be solved through cooperative action: a permanent bi-state agency should be created and given power to regulate sewage discharge throughout a metropolitan sewage district, which would include portions of both states. The new agency would also develop a “comprehensive plan” for proper sewage disposal across the region. This approach—a permanent administrative agency, operating in all parts of a bounded district that ranged across portions of two states, and responsible for preparing a comprehensive plan for action— would be embraced by Cohen as he sought ways to meet the freight controversy a decade later.18 A second illustration of the need for cooperation between the two states was the long struggle to construct a vehicular bridge or tunnel across the Hudson River. To the east, Manhattan Island had been joined to Brooklyn, Queens, and Long Island by a series of spans—the Brooklyn Bridge in 1883 and three other bridges in 1903–1910. These large crossings were major stimuli to the economic development of the eastern boroughs of New York City and the towns of Long Island.19

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To build similar connections between New Jersey and Manhattan, however, involved more difficult challenges—in both engineering and political terms. In 1906 both states created commissions to work together in devising a plan for spanning the Hudson. Cooperating intermittently, the two commissions grappled with difficult technical problems and finally reported in 1909 that it would be desirable and feasible to construct a bridge across the Hudson—either at 57th Street, 110th Street, or 179th Street. Then sentiment among members of the two Bridge and Tunnel Commissions split; some commissioners continued to advocate a bridge, provisionally at about 57th Street, but in 1913 the New York Commission concluded that a vehicular tunnel from Jersey City under the Hudson to lower Manhattan would be more desirable—and much cheaper—than a bridge.20 By 1913–14 there was considerable public sentiment both in Northern New Jersey and in New York for some sort of crossing to Manhattan, displacing the ferries with their long waiting lines and sometimes hazardous journeys. However, the New Jersey legislature was reluctant to take on the financial burden (estimated at $11 million or more), and in 1914 the Trenton legislators passed a law permitting any three counties to join together in order to build a tunnel or a bridge—if they were willing to pay for it. Local officials were also wary of the cost and its impact on local taxes, and no action was taken during the next two years. Now, as Cohen reviewed the issue in 1916, public sentiment across the region seemed to favor pressing ahead with a tunnel, the lower-cost option; and officials in both states were once again trying to create a joint agency to carry out the project. The “bridge and tunnel” story underscored to Cohen the difficulty of moving ahead if the representatives from the two states were motivated and controlled by different perspectives and priorities. A single bi-state agency, or two parallel commissions created under similar laws and dedicated to working as a unified body, would be far preferable.21

The Bi-State Harbor: Competing Strategies for Success The third major thread in the struggle for interstate cooperation was centered on the problem of economic development in the New York region, and brought Cohen directly to the issues handed to him by the Chamber of Commerce executives in 1916. In 1911, Governors Woodrow Wilson of New Jersey and John Dix of New York created study commissions to work together on ways to improve efficiency in the harbor area. As Wilson remarked, the commissions were

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expected to examine “the whole future development of the great port of New York.”22 A number of major problems in the region’s transport system were soon identified by the two bodies; and before the end of 1911 many of the strands Cohen would later weave together to design a Port Authority had been identified. The most useful contribution was made by Calvin Tompkins, one of Dix’s appointees to the study group and also Dock Commissioner in New York City. In a series of speeches and papers, Tompkins identified competition among the region’s railroads as a crucial cause for the “inefficient” use of the waterfront in both states, and for the general pattern of transportation congestion and high cost for which the Port of New York was legendary; and he sketched out a plan to reorganize pier arrangements in Manhattan and to construct new shipping facilities in less congested areas of Brooklyn and Staten Island. Tompkins concluded that the improvements would cost $173 million and that they could be self-supporting (that is, financed out of increased revenues). He also argued that tunnels large enough to carry freight railroads from New Jersey under the Hudson River to New York City should be constructed, together with extensive freight yards on the New Jersey side. Finally, Tompkins concluded that this was a problem requiring region-wide action, and that a cooperative bi-state program was needed.23 The two state commissions worked together intermittently in 1911–1913, but by 1914 the New Jersey group had begun to see the issue in a quite different way than that envisioned by Woodrow Wilson and by New Yorkers Dix and Tompkins. To the New Jersey commissioners the primary challenge was to remedy their state’s second-rate position in reaping benefits from the nation’s largest port. As their 1914 report argued, an efficient freight system for foreign trade required that goods be transferred directly from the trans-continental railroads to waiting ships. Since most of the rail lines terminated on the Jersey side of the Hudson River, the shipping lines should also be docking there; yet only seven shipping companies used New Jersey piers, while 70 landed at docks on the New York side. The result was expensive lighterage, which added to the cost of goods traveling into and through the region, as well as generating heavy congestion in the harbor and at the New York terminals. Most important, the present system undercut the industrial development of their own state.24 The best solution to the problem, the New Jersey commissioners concluded, would be to construct the needed piers on the west side of the harbor. This had not been done because the New Jersey waterfront was fragmented

2-2. Freight from the West was deposited by most railroads at their own New Jersey piers and floated across the Hudson to Manhattan and Brooklyn docks. The main exception was the New York Central, which came from Chicago through New York State and crossed the Hudson at a narrow point far north, traveling south to New York City. (The PRR and H&M tracks under the Hudson were devoted to passenger traffic.)

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among many cities and towns. Meanwhile New York City, with its unified control over much of the Eastern harbor, had invested heavily in piers and other improvements, and had attracted most of the traffic; by 1914 it owned 230 piers, while New Jersey’s cities held only two. Now it was time for New Jersey to act—creating a “central port authority” which would reach from the Hudson waterfront west to Newark Bay. This port agency would supervise the construction of modern piers by local communities and provide regulatory control over all waterfront development. Its aim would be a “scientifically planned market and distributing system in New Jersey as well as in New York.” A state-sponsored port authority, the commissioners concluded, was most likely “the only plan by which New Jersey can reap its proper share of the benefits from commerce.”25 The 1914 document contained a few references to cooperative efforts with New York, but the main thrust of the report favored independent action to win out in the competitive struggle against its larger but vulnerable neighbor, the New York Goliath. New Jersey legislators reaffirmed their go-it-alone policy in 1915, creating a new state body, the Board of Commerce and Navigation, to lead the modernization effort. Cities and towns along the Hudson and other waterways were wary of the spectre of state power, however, and the new agency was not given the power of condemnation or funds to construct new docks or carry out other large capital improvements.26 Blocked from taking vigorous direct action on the “supply side” (by constructing modern ship terminals and rail spurs), the Board of Commerce and Navigation turned to the “demand side”—the use of the pricing system as a way to obtain more pier space in the New Jersey sector of the harbor. By the late summer of 1915, the Board had sketched out the argument—outlined earlier in this chapter—that freight rates for rail deliveries to Northern New Jersey locations should be lower than charges for freight delivered to marine terminals in Manhattan or Brooklyn. The Board’s logic appeared to be that lower rates would increase the demand for modern pier facilities on the New Jersey waterfront, and that Jersey City and other localities could then respond with capital improvement programs, confident that the new piers and rail connections would more than pay their way.27 The logic was not without its flaws, as Cohen and his associates pointed out later. But in 1915, the Board’s stratagem—criticize New York and the railroads for “unfair discrimination” in railroad rates, and threaten legal action as a route to lower rates—was an immediate political success. The Board’s plan not only permitted New Jersey’s public officials to attack two of their favorite ogres (the rail corporations and the gorged but still grasping city); it

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also meant that local and state officials could defer for another day some financially and politically difficult issues: ■

■

■

■

which harbor areas in northern New Jersey should receive major investments? what kinds of improvements would be needed in order to attract rail and shipping services from the New York side, and from Baltimore and other competing ports? what sort of coordination would be needed in order to restrain the New Jersey cities from competing destructively against each other as well as against New York? who would bear the cost if large capital investments failed to pay their way?

New York City’s recent battles over subway costs and routes, and its problems in modernizing its own docks, suggested there were no easy answers to these questions; and New York’s capacity to plan and to generate investment dollars was far beyond that of New Jersey’s small and middle-sized cities.28 With its strategy determined, the New Jersey agency convened a public meeting in September 1915 and outlined its conclusions. The Board found much support among local public officials and tradespeople for its proposed litigation; and Woodrow Wilson’s successor as governor, James F. Fielder, also endorsed that strategy. During the next several months, the state’s major waterfront cities—Newark, Jersey City, Elizabeth, and Hoboken—worked with state agencies and with the New Jersey State Chamber of Commerce in preparing a challenge to the traditional rate system. On May 27, 1916 the New Jersey interests submitted their brief to the Interstate Commerce Commission and urged that the ICC require the railroads to charge lower rates to marine terminals in New Jersey.29 Meanwhile, the tenuous alliance that held New York City and state officials at Albany in a common front—favoring bi-state cooperation—was crumbling. Business and political leaders in Brooklyn and Staten Island had long been sensitive to the local disadvantages that could result from vigorous bi-state collaboration. Under such a program, waterfront areas in New Jersey would be improved, while investment in marine terminals in Brooklyn and other parts of New York might be disregarded. Equally important, especially for city politicians, a bi-state effort posed the danger that state officials would usurp the city’s ability to control its own destiny. In this case, New York City’s ability to deter-

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mine its own future as a world maritime power might be lost—transferred to officials at Albany and to their allies in the Manhattan business community, who seemed to undervalue political accountability whenever that democratic value clashed with claims of business efficiency and business profit.30 So it was predictable, once the New Jersey commission had issued its 1914 proclamation of separatism, that some of New York City’s public officials would move away from regionalism. They could argue that more than half of the region’s entire waterfront lay within the borders of the city, and that during the past three decades its Department of Docks had been modernizing its harbors and piers. New York City’s marine facilities were the busiest in the world. If there were problems, Gotham could solve them, reap the advantages in reputation and in funds for municipal use, and maintain New York’s position as the world’s premier port. In pursuit of this view, in 1914 the city’s Board of Estimate created a committee to prepare plans for reducing congestion along Manhattan’s West Side waterfront, which was viewed as a major contributor to delays and high costs in the New York region. This committee issued one report in 1915 and another in 1916, but at that point conflict broke out among the several groups in the city on the best way to solve the West Side problem.31

From this Nettle, Pluck a Rose In 1916, the issue was in Cohen’s hands. As the general counsel for the New York State Chamber of Commerce, facing New Jersey’s suit, Cohen had a client to defend. Indeed he had two clients, for the governor of New York and his aides had also designated Cohen to represent the state’s interests. But how could his clients’ interests be best served? The answer was not immediately clear.

The Dangers of Litigation If the New Jersey challenge were fought out toe-to-toe, it was not at all certain that Cohen would win. He could argue—and he did—that the bi-state region had been treated historically as a single rate zone, and that dividing it into a New Jersey (or western) zone and a New York (or eastern) zone would disrupt railroad rates and shipping patterns which had evolved over decades. But how much influence would the weight of history have with the ICC and the courts, if “efficiency” favored the New Jersey position? In an age of scientific management and rational planning, Cohen could not be sure. In-

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deed, under the influence of Brandeis, who had acted as a close adviser to the Interstate Commerce Commission in the recent railroad rate cases, the ICC’s inclination to embrace efficiency seemed especially strong. And when the issue of freight rates was looked at from the perspective of rational planning, the New Jersey argument—that costly lighterage operations ought to be separately charged, that such charges would reduce the tendency of shippers to send goods to overcrowded dock areas in Manhattan and Brooklyn, and that the result would be lower freight costs in the New York region and nationally—might command wide support.32 But there was a flaw in the New Jersey stance. If the ICC required that the railroads charge higher fees for shippers sending their goods to the New York side of the port, that would almost certainly drive many shippers to cheaper locations. They would shift to the less expensive “New Jersey zone,” however, only if modern shipping piers and rail-pier connections existed there; and it was not clear that the state and its cities had the political will and organizing capacity to take control of the waterfront and modernize their port facilities. If the New Jersey port areas did not respond quickly, the traffic leaving the New York side might instead depart for other major ports—Baltimore, New Orleans, Philadelphia. That result would not only hurt New York; it would also damage the economy of Northern New Jersey, which benefited from the commercial activities carried out on the eastern side of the Hudson.33 The local fallout from a change in freight rates was not the major concern at the ICC. If economic analysis showed that the efficiency of the national freight system would be improved through separate charges for lighterage, and if as a result shippers favored Baltimore and New Orleans, so be it! However, even if Cohen had felt confident that his New York clients could win the case, neither he nor his Chamber of Commerce associates were inclined to rely on litigation as the primary route to a solution. The court battles might drag on for years—as the ongoing interstate conflict on the water pollution problem illustrated—and that would interfere with modernizing the Port, which required cooperative bi-state action. Moreover, by temperament and experience, Cohen was inclined to avoid protracted conflict and litigation; he preferred to bring the contending parties together to work out a solution.34

From Danger to Opportunity How, then, should he proceed? Cohen first had to file a response to the New Jersey challenge, and in October 1916 he submitted a brief which opposed

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splitting the region into two freight zones, and which emphasized the historical unity of the Port of New York and the great economic advantages which had accrued to Northern New Jersey as well as New York under the existing system.35 Meanwhile, Cohen considered how he could redirect the controversy along a more positive tack. The lessons of history suggested that a bi-state study commission might be a constructive first step; that approach had worked in the early nineteenth century, leading to the 1834 Treaty and seven decades of tranquility. More recent efforts to reach a common plan of action through joint study commissions—on the bridge-and-tunnel issue, and on harbor problems—had been disappointing; but the weaknesses seen there might be overcome if the two states appointed members who were firmly committed to a regional perspective, and who eschewed jockeying for narrower advantage. And that positive step might be taken if the two governors were publicly committed to bi-state cooperation. If the governors could be persuaded to take the lead in pressing for cooperative action, the ICC might then be willing to hold the litigation in abeyance while the two states tried to reconcile their differences. This pause in litigation would meet Cohen’s short-term goal, since New York would be left temporarily with the existing unified rate system. But an ICC decision to defer final action would also have a further impact: Hanging like a sword of Damocles over the heads of New York’s political leaders and her more parochial business executives in the outlying boroughs, the New York Harbor case would provide a needed prod toward cooperative action. Meanwhile, across the Hudson, Cohen could seek support from business and government leaders who might prefer a cooperative program of modernization to continued litigation. In the winter of 1916–17, as Julius Henry Cohen thought through his strategic plans, the fortunes of politics created an almost perfect combination for his designs. In Albany, Republican Governor Charles Whitman had known Cohen for years and shared his interest in reform. Cohen had been active in the Committee of 100 which had fought successfully, in the 1910 reform campaign, to elect Whitman as District Attorney on an anti-Tammany slate. In 1914, Whitman had been elected governor, and in 1916 he had been re-elected to a second two-year term. It seemed likely that Whitman would support a cooperative approach to meeting the harbor problem.36 In New York City, Cohen also had a friend and fellow reformer in power. In 1910, John Purroy Mitchel had been elected president of the city’s Board of Aldermen, and in 1913, he had won a four-year term. Mitchel’s main con-

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cern was “the modernization and integrity of administration,” and he was likely to favor a study which took a broad view of harbor problems and economic development strategies. But Mitchel’s political future was precarious; a Democrat elected on a reform “fusion” ticket with Republican support, he lacked the talent for political negotiation and coalition-building, and the forces of Tammany were organizing to reclaim the mayor’s office in the fall 1917 election. If Cohen and his allies could establish a firm basis for cooperation across the Hudson before that fall campaign, the impact of Tammany’s obstructionism would be much reduced.37 When Cohen had surveyed the political scene in the summer and early fall of 1916, the major hurdle to going forward quickly with a plan of cooperation had been the governor of New Jersey, James Fielder. A Democrat from Jersey City, he had embraced the ICC litigation strategy. However, in the November 1916 election, the victor was Walter E. Edge, a wealthy Republican businessman from the southern regions of New Jersey, who took a very different view. Edge had served as state senator during the years 1911–1916, taking a leading role in securing legislation to protect industrial workers, and to reorganize government agencies in order to reduce duplication and inefficiency. In his campaign for the governorship, Edge adopted the slogan, “A Business Man with a Business Plan”; and he urged that state highways be improved and that transportation facilities between New Jersey and New York be modernized. Since the state’s road system was under the control of county political officials, was a frequent source of corruption, and was in poor shape—especially under the onslaught of the growing number of horseless carriages—Edge also pressed for state action to “remove the highways from political control and place them under non-partisan, technical control.” As Cohen weighed his plans for the new year, these were themes that could not but warm his heart: New Jersey was led by a man whose central values were those of the New York Chamber of Commerce, the Citizens Union, and Julius Henry Cohen himself!38 Oral arguments in the ICC case were scheduled for early in 1917, and on January 10, Cohen confronted the opposing lawyers in the first day of the hearing, held in New York City. During the next several weeks, the two sides laid out their very different views. New Jersey’s testimony emphasized that if the true cost of lighterage across the harbor were added to New York’s shipping charges, “steamships would move their docks to the Jersey shore” to avoid paying the extra costs; and they thought it likely that a migration of manufacturing plants would follow. However, ICC hearing examiner Wilbur La Roe extracted a damaging admission from one of New Jersey’s major wit-

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nesses, chief engineer B. F. Cresson of the State Board of Commerce and Navigation, in the following colloquy: La Roe: “Is it your understanding as an engineer that the failure of the west side of the port to develop is due in great part to the lethargy of the people . . . and that if the proper spirit were manifested, necessary funds provided, and a co-ordination of authority and central control substituted for the present division, a very material advancement could be made on the west shore without a change in freight rates? Cresson: “I think that is so.”

The New York Times ran its report on this exchange under the headline, “Engineer Admits at Federal Hearing that Lethargy of People Has Arrested Development.”39 When New York’s physical separation from the continent (and its railroads) was combined with New Jersey’s indolence, might the economic future of the region—dependent as it was on foreign trade—be in jeopardy? Cohen’s fears, that opening up the rate issue might lead to unwelcome challenges, was soon confirmed: a spokesman for Baltimore appeared at the hearing to say that once the New York Harbor case was concluded, his city would ask the ICC to take the next step—lowering rail freight rates to that major seaport.40 While the public controversy went forward, Cohen and his associates at the Chamber of Commerce—Outerbridge and Bush—were moving in other directions. Informal contacts were made with Governors Whitman and Edge; both favored a cooperative approach, and both agreed to attend a public meeting and to press for joint action. That session was held in the Great Hall of the New York Chamber of Commerce on March l, with business groups and local public officials from both states on hand. Governor Edge told the assembled regional leaders that he wanted to see “industrial New York and industrial New Jersey co-operating” and “a joint commission appointed representing the two states,” which would devise a unified strategy to improve commerce in the port area.” As Cohen observed later, Governor Edge had “in substance repudiated the isolationist policy of his predecessor.”41 Meeting later that day with Cohen, the two governors agreed to create a study commission and to appoint members who were committed to working in harmony. Cohen then drafted legislation to establish a joint body to study conditions in “the entire Port of New York” and to recommend policies the two states might adopt in order to reorganize and modernize the bi-state port. Both governors endorsed the bill, and within a few weeks, legislation author-

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izing the joint agency—the New York, New Jersey Port and Harbor Development Commission—had been passed in both states.42

The Study Commission and the ICC Now Julius Henry could use these March maneuvers to serve both his narrower and his broader purposes in the ICC case. On April 14, 1917, he submitted his final brief on behalf of New York State and the Chamber. Opposing the division of the Port into two rate zones, Cohen acknowledged that service in the New York region must be improved. “But how is it to come about?,” he asked rhetorically. Recent events encouraged Cohen to tender a wide-ranging response: Governors Whitman and Edge have given the answer. Let all hands turn to and cooperate in the solution of this great problem. Its final engineering solution will require the constructive mind of a great engineer . . . and hundreds of millions of dollars. . . . [And] there must be provided better political organization of the municipalities of New Jersey and legal power on all sides of the harbor.

To proceed in this way, Cohen continued, will require “a liberal spirit on all sides” in order to “break down political barriers [and] put aside petty rivalries.” Cohen then noted that the ICC hearings had helped to encourage cooperation by state leaders, making the ICC suit “a blessing in disguise.” But, he warned, if the ICC were now to accept the argument of the New Jersey interests and create a New Jersey zone, that action “would destroy the newborn spirit, would paralyze the initiative and palsy the hands of those who would put endeavor into this great work.”43 During the next several months, while the ICC deliberated, it was important to demonstrate to that august group that the new spirit of cooperation was more than a passing zephyr, that real accomplishment might be attained despite the recent unhappy experiences in interstate friction and inaction. Governor Whitman ensured that the Chamber of Commerce’s desire for bistate cooperation would be embedded in the bi-state commission by naming Outerbridge as one of his three appointees; and the governors chose five other appointees who were thought likely to support a regional approach. On August 1, the six members held their first meeting and agreed to organize as a unified body, with William Willcox of New York as chairman and J. Spencer Smith of New Jersey as vice chairman. They signaled their interest

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in nonpolitical expertise by naming George Goethals, of Panama Canal fame, as consulting engineer to the Commission. To head the engineering staff, they chose New Jersey’s B.F. Cresson. And to maintain a balance between the states, the bi-state Port and Harbor Development Commission selected, as its general counsel, Julius Henry Cohen.44 Once the bi-state Commission was organized, its members saw that the wartime traffic situation offered a ready-made opportunity to demonstrate not only the weaknesses in the existing transport system, but also the strengths of a system of stronger control. Intermittently since the war began in 1914, the slow and inefficient lighterage system had been unable to cope with the flow of goods bound for Europe, and loaded rail cars had backed up across New Jersey and into Pennsylvania. After the United States entered the war, in April 1917, conditions worsened, with waiting railroad cars extending for hundreds of miles. The Commission leaders made contact with the White House, and on October 3, Outerbridge, Willcox, and Cohen met with President Wilson and recommended that he create a War Board, composed of top officials of all departments engaged in shipping goods through the Port of New York. The bi-state Commission’s staff would serve as the staff for the Board in coordinating shipping and ending the backlog. Wilson accepted the idea, Irving Bush was designated as chief executive officer in devising and carrying out a plan, and Cohen was named secretary to the Board. A program was developed to coordinate rail-maritime traffic passing through the terminals at Hoboken, Manhattan, and Brooklyn, and by early 1918 the backlog was largely eliminated. Two years later, the Commission reflected on this experience: “This War Board for the Port of New York represented the first successful co-ordination in a single body of all possessing authority in the Port, and is believed to have been a working agency of great value in the prosecution of the war.” The Commission members had a taste of a possible future, and it worked!45 On December 17, 1917, the Interstate Commerce Commission handed down its decision in the New York Harbor case, and Cohen found his strategy vindicated. The ICC agreed with the argument in the New York brief that “historically, geographically, and commercially” New York City and industrial North Jersey “constitute a single community” and that New Jersey had prospered from its close association with New York. The Commission also agreed with the contention that the existing freight distribution system in the region needed to be drastically altered; but it declined—for the present—to accept New Jersey’s argument that giving New Jersey a lower rail rate would bring about a more efficient system. Instead, the ICC argued, the railroads

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now terminating on the New Jersey shore should be extended, through tunnels under the Hudson River, to Manhattan, so that freight could be transferred there to trucks bound for New York’s vast system of piers, thus eliminating the delays and cost of lighterage. And the Commission noted that the two states were now cooperating in order to modernize the rail and pier system across the Port.46 The ICC went further, however, creating Cohen’s Sword of Damocles over the heads of those New Yorkers who might be content with the existing system, which had brought wealth to the Greater City. For the ICC noted that half of the nation’s total export and import traffic was carried through the Port of New York, and that more than 85 percent of this total had to be conveyed on lighters to or from piers in Manhattan and Brooklyn. It then suggested that this method might involve “a huge economic loss which is in a sense an unjustifiable burden upon the people of the whole country” and concluded that the New Jersey position was “in a measure justified from an economic viewpoint.” If the burdens of lighterage and other inefficiencies could not be solved through positive action by the two states jointly, the Commission warned, the ICC might reopen the case: “There may come a time when the burden of handling the enormous tonnage in and out of the port will be so onerous that Manhattan itself may need such relief as lower rates to and from the New Jersey shore would in part afford.”47 Gently phrased, the ICC’s soft glove contained within it a mailed fist; and Cohen could hope that this authoritative opinion would contain just the right mix to encourage the narrower interests in New York to reach out in a cooperative spirit toward New Jersey, while ending the tendency in that combative state to rely on litigation as the main route to a modernized pier system and further economic growth. So a year of contention and renewed cooperation came to an end, and Julius Henry Cohen could look forward to building upon this constructive spirit in the new year of 1918. Only one small cloud could be seen on the horizon at December’s close. But the name of that cloud was Tammany; and its wrath would soon break over the head of the bi-state commission and her chief legal strategist.

3 Designing a New Organization An Uneasy Marriage of Planning and Politics

History has many cunning passages, contrived corridors And issues, deceives with whispering ambitions, Guides us by vanities. . . . Gives too soon Into weak hands. . . . —T.S. Eliot, Gerontion

I

t may well be, as Elting Morison has observed, that men and women who grew to maturity in the years between 1870 and the First World War came to understand the possibilities for social progress, and the obligations of personal responsibility, in quite distinctive ways. To the members of those generations, each individual seemed to be in “full control” of his or her own behavior, with some obligation to be “up and doing in the cause of righteousness.” Moreover, one thought not of “how little time there was,” but rather that there was time enough—time for the survey of causes and the measurements of effects . . . time for things to work themselves out, time for the cumulative results of selected small changes to take hold, time in which one slow, increasing purpose could work onward, and probably upward and possibly forever.1

Julius Henry Cohen grew up in that time of optimism, and so did others who took important roles in the efforts to encourage regional cooperation during the years before and after the Great War. Indeed three of the leading men in this story were born in the same year, 1873, and so reached 40 before the war began—Cohen himself, New Jersey’s Walter Edge, and a New Yorker who would soon enter the Port Authority saga and in time be revered as one of the nation’s great governors, Alfred E. Smith. For some from that generation, the Great War was a devastating event, shaking their sense of competence and their hopes for progress. “The war 47

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that began in August 1914,” Morison writes, “destroyed all the carefully controlled arrangements that held a serene and innocent time together. . . . It broke up the process by which men had been accustomed to learn essential things about their environment. Intruding suddenly, like the act of some angry or indifferent god, upon the affairs of competent and responsible men, it befuddled . . . the senses of competence and responsibility. . . . Those who had prepared themselves to live in 1910 had little to bring down with them that could be made to fit the life of the twenties.”2 In contrast, Cohen and Edge and Smith maintained their optimism and their willingness to do battle, with the hope that their efforts would, in time, bring success. For Cohen, faith and a strong pair of rose-colored glasses were essential if he were to persevere during the next few years, as the prospects for a vigorous new system of regional control and port modernization seeped away. Without the nourishment of those earlier decades, Cohen and his colleagues might have lost hope and left the fray, as their enterprise trudged slowly from the modest success of 1917 through the gray and uncertain years of 1918, 1919, and 1920, to the pallid achievements of 1921 and 1922, and then to the complete failure of the “comprehensive” solution they had envisioned—until Cohen’s bi-state agency could finally emerge a decade later, transformed from stolid railroad buffalo of the 1920s to lean and opportunistic gazelle of the motor age.

A Planner’s Vision Before Cohen was compelled to feel the sharp teeth of Tammany, and the emasculating scalpels of jealous legislators, he enjoyed a few months of peaceful contemplation and creative legal writing. In January 1918, the bistate Commission issued its preliminary report, which asked the two states to finance an extensive survey of the region’s complex transport problems; both governors strongly endorsed the request, and within a few weeks the states had provided money for a two-year study.3 Most of the funds were allocated to a team of engineers and statisticians who analyzed the patterns of rail, truck, and waterway traffic and examined a range of possible solutions. But a small chunk went to Cohen, so that he could devote the summer and fall of 1918 to analyzing the legal issues and devising some mechanism through which New York State and New Jersey could work jointly and in harmony—in carrying out the engineering projects and other tasks needed to convert the Port of New York from one of the most

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backward to one of the most modern of the world’s large ports. Cohen drew upon several ideas that were embedded in earlier reports on the New York region, he studied the legal and operating designs of port agencies in London and Liverpool, and he added a few distinctive contributions of his own. By early December 1918, he had a tentative draft to lay before the bi-state Commissioners, the two governors, and the general public. Cohen’s 1918 proposal was a planner’s dream. A bi-state “Port of New York Authority” would be created, with the responsibility to shape development across an area embracing more than 50 cities and towns in two states (encompassed in a “Port of New York District”). After initial approvals by the state legislatures, and a two-thirds vote by the region’s citizens (through their local governments), the new agency would have extraordinary powers: the power not only to issue regulations governing construction, commercial transactions, and other activities in the Port District (rules that would be binding on private corporations and local governments); but also the power to block state actions inconsistent with a plan for “comprehensive development” of the Port area. Ultimately, Cohen anticipated, the agency might also be given the power to grapple effectively with the pollution problem; then it could regulate the waters of New York Bay, and development along the hundreds of miles of waterfront, so that the region’s growth potential—and the water and air pollution generated by that growth—could be controlled and shaped harmoniously. This was a bi-state agency designed for independent action—its commissioners appointed for six-year overlapping terms, so that neither state could alter the Authority’s policies abruptly by replacing these top officials; its revenues drawn from its own self-supporting projects, so that the states could not use the traditional power of the purse to control its programs; its actions safeguarded from executive controls, as the governors were given no review or veto power over the Authority’s decisions.4 With these safeguards for its independence, coupled with its substantial regulatory and operating powers, the Port of New York Authority would be an exemplar of the reformer’s vision: insulated from intraregional jealousies and the many vagaries of politics, the Authority’s skilled staff of engineers and planners would analyze, monitor, and shape the modernization of the Port and the economic growth of the surrounding region, guided only by principles of efficiency and the public interest.5 Once Cohen’s initial plan was exposed to the light and heat of local and state political forces, many of its crucial provisions could not survive. State officials and their local counterparts raised the banner of “democracy” and the necessity for “public accountability” against the offending document;

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and the Port Authority idea was hammered through three more drafts before it emerged, a much altered animal, and received final approval more than two years later. However, it is useful to examine his initial draft in somewhat more detail, as an illustration of a significant Progressive impulse—toward both insulating and concentrating political power.6 Then we can turn to the evolution of that draft during 1919, 1920 and 1921, and to the associated debates on how a new agency with regional aspirations might be aided and shackled—debates which exemplify the mix of worthy and unlovely motives that march under the banner of “democracy.” To understand Julius Henry Cohen’s initial plan, we can begin with an essay he wrote in 1920 for the Cornell Law Quarterly. There he explained that his goal had been to design a bi-state agency “vested with broad legal powers to build, maintain and operate port facilities” and to “improve commerce and navigation”; the agency would be given “adequate power” to shape Port activities whether under “public or private ownership.”7 Cohen’s December 1918 draft attempted to achieve this result through a series of steps, many of them built upon earlier decisions and proposals: 1. The two states would create a “Port of New York Authority,” an agency of the two states which would operate within a Port District that embraced New York Bay and the nearby waterfront and land areas of both states.8 2. The new Port Authority would be established via the Compact Clause of the U. S. Constitution, by amending an existing treaty, the 1834 Compact between New Jersey and New York State. Here Cohen made a distinctive contribution; his proposal to root the new agency in the Compact Clause was carried over into the final draft and has provided a crucial base for the continued stability of the agency over the years. Until Cohen’s 1918 suggestion, the Compact Clause had been used to settle boundary disputes and other jurisdictional issues among the states, but not as a basis for a permanent interstate body. When continuing, cooperative action between states was needed, they had instead created separate state commissions which would work in collaboration—or sometimes in disharmony. The traditional tendency not to use the Compact Clause is understandable, since it is phrased as restriction on the states, not as a route to collaborative state power; and it was Cohen’s creative insight to see the positive potential for continuing cooperation in that negative language.9 Cohen located a distinct advantage in creating an agency via the Compact Clause, rather than using joint commissions. An interstate compact must be approved by Congress; and once that step has been taken, it is very difficult for any party to withdraw its participation. In an era when New Jer-

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sey and New York might at any point be led by elected officials who, in a fit of hostility, could simply abrogate cooperation by their half of a joint commission, the firmer bonds provided by the Compact Clause were no small benefit—at least to those, like Cohen, Outerbridge, Edge, and Whitman, who favored vigorous and sustained cooperative action.10 3. The Port Authority would be governed by a board of six commissioners, three appointed by each state; these board members would serve for six-year overlapping terms. This provision was consistent with an American tradition; multi-headed commissions, with overlapping terms, were used frequently when board members were expected to use independent judgment and nonpartisan expertise in carrying out public policies. For Cohen and his colleagues, a major concern was continuity of leadership; six-year overlapping terms would serve that goal, which had been undercut by the tradition of bringing in new people and new policies every time a new mayor took office.11 4. Under Cohen’s plan, the commissioners would receive no salaries or other payments. From his experience in New York politics and discussions with officials of the Liverpool and London port authorities, Cohen had concluded that a salaried commission post would be attractive as a reward for party service, and the governors would be under continuous pressure to allot these positions to the party faithful. If the posts were unsalaried, the two governors could more easily appoint individuals who were able and knowledgeable about port and economic conditions, regardless of party service.12 5. In Cohen’s draft, the duties and salaries of the Port Authority’s staff would be determined solely by its commissioners. Thus the new agency would not become enmeshed in the narrow constraints that were part of local and state civil-service systems, and the ability of the two states to exercise close control through review of positions and salaries would also be excluded. This provision entailed some risk, of course; if the states appointed commissioners who were politically motivated, the Port Authority could become riddled with patronage appointments. Cohen was willing to take that risk, for he expected that he and his associates could persuade the two governors to appoint distinguished members of the business and legal communities—men and women who would have the fortitude to defend the agency’s integrity against pressures from state officials. 6. The new agency would have “full power and authority” to purchase, construct, and operate “any terminal or transportation facility” within the Port District, and to charge rents and tolls to pay for the use and modernization of its piers, warehouses, and other structures. Also, the Port Authority could float bonds secured by the income from its operations. These powers,

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combined with the structure of independence outlined above, might permit the Port Authority to overcome a serious weakness found in many port-development agencies. In New York as in many cities, much of the revenue from public docks and harbor activities was siphoned off and applied to unrelated city and state purposes. Critics argued that these revenues should instead be plowed back into modernization, which would repay the investment by attracting more commerce and more jobs, and serve as an engine of economic progress for the wider region. By giving the Port Authority the ability to issue bonds backed by its own revenues, Cohen’s proposal would make it more difficult for cities and states to divert the agency’s surpluses.13 7. Cohen did not attempt to give taxing power to the new agency. State officials seemed unlikely to grant that power; and it was doubtful a taxing district would have the political independence which Cohen believed the Port Authority required.14 This was Cohen’s preferred model. But he was not content to rest the financial health of his offspring, and its future prospects for benefiting the region, on its ability to develop an array of harbor projects so clearly self-sustaining that conservative bankers would buy its bonds, secured only by its own revenues. There was a fall-back position tucked away in the inner reaches of his 1918 draft treaty. If the banking community would not endorse bonds based only on these revenues, the Port Authority’s leaders could ask the states to guarantee its bonds. Albany and Trenton might then agree to do so, since ultimately the whole package of projects and activities carried out by the Port Authority could in time be self-supporting; that prospect was suggested by experience at London, Liverpool, and some American ports. This was not Cohen’s preferred option, of course, since state credit would carry with it some risk that the states would use that step as a route to control the Port Authority’s activities. But it was available if needed.15 These provisions would give the new agency some independence; but would it be able to take a leading role in meeting the Port’s problems of congestion and its need for modernization? Its financial powers, and therefore its capacity to act on its own, were limited. Moreover, the Port’s problems, as Cohen and others understood them, were largely caused by the behavior and misbehavior of others: the large cities and small towns which went their own way in building piers or letting them fall into disrepair; the states (especially New Jersey), which sold waterfront land rather than developing it as part of a region-wide plan; and the railroads, steamship lines, and other private corporations, which needed to be led from competitive inefficiency in transportation and waterfront use into the path of righteousness.

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To meet these crucial problems, Cohen’s draft treaty provided his Port Authority with a second, and rather sharper, set of teeth: A. Once the state legislatures approved “any plan or plans for the comprehensive development of the Port of New York, or for “any part of the District,” “no change in such plans shall thereafter be made except by and with the approval of the Port Authority.” (Article IX; emphasis added) The Commission’s engineering and planning staff was hard at work preparing detailed physical plans for new marine terminals, railroad tunnels under the Hudson, and other improvements; Cohen’s provision would give continuing control over development in the region to the Port Authority, once the two states had given initial approval to these plans. B. Substantial parcels of land in the port area were owned by the states themselves; under the treaty both states would henceforth be barred from making any grants of land within the Port District “without the approval of the Port Authority” (Article VIII). C. In addition to constraining the states, Cohen sought to exercise some control over the dozens of local governments in the Port District. Under Article XVII the Port Authority could propose “orders, rules and regulations” in order to improve “navigation and commerce” in the District; and unless the governing bodies of municipalities with a population of at least one-third of the District’s total population formally objected in 90 days, the Port Authority regulations would be “binding within the District upon all persons and corporations” (emphasis added). Cohen’s proposal was innovative in providing for a voting role for cities and towns in relation to policies of a semi-independent public corporation. But the reality was that only New York City, with more than half the population of the Port area, would be able to block the Authority’s policies on its own; no other city, alone or with a dozen of the largest cities other than New York City, could stay the Port Authority’s hand. Nor would New York City, or an alliance of many cities that reached the one-third figure, necessarily be protected. For if opposition reached the magic one-third mark, the Port Authority could then apply to the courts, which would be asked to inquire into “the facts and circumstances” and determine whether the regulation “is reasonable and of public necessity.” The finding of the court would be binding on all cities, villages, and other local bodies—even if half, or two-thirds, or all of them were opposed. D. But suppose an individual, corporation, or city were to violate an approved regulation issued by the Port Authority? Under Article XVIII, the offender would be liable for a fine of up to $5000, or imprisonment—“for not more than one year.”

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E. Finally, the Port Authority would be given the right to apply to the Interstate Commerce Commission, and to state regulatory bodies, in order to obtain their support—and enforcement powers—in compelling changes in the way freight was handled by the railroads and others, and in altering freight rates, whenever such changes would “in the opinion of the Port Authority” be likely to “improve or better the handling of commerce” in the Port District (Article XII). In the years between 1900 and 1920, reformers from across the United States often found that “a patchwork government” could no longer meet the problems of a complex society with the “expertise and economy” that seemed essential. The reformers then “reached out for the power to reorder the government themselves.”16 Some of their schemes insulated the agents of government power—city managers, regional park boards, state utility commissions—from local politics, with the hope that these officials could eschew political expediency and rely mainly on their own broad vision and specialized knowledge in carrying out their mandates. Cohen’s Port Authority plan stood at the outer reaches of this movement: power would be taken from the neighborhood and the ward, and from the city and the state; it would be given to a group of six independent citizens who could think widely, use the skills of an able technical staff to plan wisely, and then act benevolently to improve the economic conditions for 8 million people and dozens of cities and towns; and if the citizens of these cities and towns could not directly affect the steady march of progress as the Port Authority carried out its plans, they would receive just compensation, in Cohen’s view, in the increased economic vitality of a vast bi-state region, and lower prices paid for food and the other necessities of life. Though it contained elements of the Progressive movement, Cohen’s offspring harkened back also to an earlier reform era, when Woodrow Wilson had argued—three decades before—that government agencies should be insulated from “the hurry and strife of politics” in order to apply businesslike principles to their work, and that their top officials should be given “large powers and unhampered discretion” in carrying out their duties. These were the powers that the Port Commissioners might attain, Cohen hoped, for the benefit of the region and the nation.17

Embraced by Reformers Julius Henry Cohen’s draft was made public in mid-December, and it was greeted with expressions of support by business and civic groups, by major

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newspapers in New York City and across the Hudson, and by Governors Whitman and Edge. Whitman saw the Port Treaty as an essential first step, to be followed by a plan requiring “the expenditure of many millions of dollars” in order to “make this port efficient.” The Brooklyn Daily Eagle agreed, and in its editorial the Eagle laid bare the underlying philosophy of Cohen’s initial draft: The powers of this body over terminal and transportation facilities seem . . . to be well nigh absolute. . . . If any far-reaching plan of harbor development is to be carried out quickly enough to maintain the commercial supremacy of this harbor, . . . the work must be in the control of an autocratic head vested with power. This ‘Port of New York Authority’ . . . would have such powers. . . . Its work could not be upset, as city improvement plans are continually upset, by changes of local administration.18

The New York Chamber of Commerce, however, thought Cohen had not gone far enough in insulating the new agency from local sentiment. Objecting to his proposal that the agency’s regulations would be subject to local referenda, the Chamber argued that municipal review “can only produce delay.” The “reasonable desire for local home rule,” the Chamber concluded, should give way to the “more important” need of improving port facilities. “Full power [should be] vested in the Port Authority itself.”19 Had Cohen’s draft treaty been available a year earlier, it might have survived in its original form. The mayor of the city most affected by the new agency—New York City—probably would have endorsed it; and Governors Whitman and Edge, Republicans with much influence in their GOP-dominated state legislatures, might have converted their personal enthusiasm into legislative victory. But in 1918, the tides of politics had turned against Cohen and his vision of regional leadership and cooperative action. In January, reformer John Purroy Mitchel had been succeeded as mayor of New York City by John F. Hylan, a Brooklyn politician who had campaigned against government reform and “efficiency experts” and had trounced Mitchel with strong support from Tammany. Hylan was soon at odds with the Citizens Union and other reform groups, and he expressed little interest in cooperation with New Jersey.20 This shift in local leadership might not have been a serious blow to Cohen’s plans if Charles Whitman had remained in the governor’s chair. A Republican in the reform tradition, he and his party majority at Albany were unlikely to defer to Hylan, even on a matter crucially affecting the city. But

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in November 1918, Whitman had been upset by Alfred E. Smith, a longtime member of Tammany Hall. While Smith was likely to take a broader view than Hylan, he could be expected to be sensitive to the rights of the city’s people, as expressed through the local officials they had chosen. Meanwhile, New Jersey’s Governor Edge had decided to run for national office, and in the fall of 1918 he had won election to the United States Senate. Although Edge would not resign from the governorship and take his place in the Senate until May of 1919, his ability to lead a cooperative effort was now weakened, and would soon end. Cohen did what he could to mend his unraveling coalition. Although Al Smith was supported by Tammany, Cohen knew that Smith was not a “Tammany man” at heart: His interests and his goals ranged far beyond a narrow calculation of how to gain votes through patronage and public posturing. During a dozen years in the state Assembly, Smith had supported reform legislation concerned with workers’ compensation, reorganization of state agencies to improve efficiency and executive control, and other matters. After criticizing Smith’s early performance in Albany, the Citizens Union in time came to support him; in this evolution Cohen played a leading role, and in time he became friends with Al.21 Smith then moved rapidly up the political ladder. In 1915 he was elected Sheriff in Manhattan with the support of both Tammany and the Citizens Union; in 1917 he was elected President of the city-wide Board of Aldermen; and in the fall of 1918 Smith was the first Democrat associated with Tammany Hall ever to win the governorship. Meanwhile, he had developed a deep concern about the problems of freight congestion in the New York region. So Cohen decided to take the initiative and see his friend: While he was putting together the first draft of the treaty in the fall of 1918, Cohen went to Smith’s home and discussed his plans, and he found Al ready to work for cooperative measures to meet the Hudson River problem.22 A few weeks later, with his draft treaty under public discussion, Cohen crossed the River and met with Walter Edge. He knew that Edge was strongly interested in prompt action on two crucial parts of his own highway improvement program—a bridge across the Delaware River to Philadelphia, and a tunnel from Jersey City to lower Manhattan—so that they would be underway before he left the State House in May. To achieve these goals, he needed the support of the new Democratic governor in Albany, and Cohen suggested that Edge propose a meeting in Albany to reach agreement on the underwater vehicular crossing, and on the Port Authority treaty. Edge agreed to take the initiative, and in late January 1919, he traveled to Albany to meet

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with Governor Smith, joined by Cohen and Outerbridge from the bi-state Commission, and by legislative leaders from both states.23 The Hudson River crossing was the first topic of discussion. A New Jersey study commission had sketched out plans for a tunnel from Jersey City to Canal Street in Manhattan, and Edge and some of the legislators favored prompt action. Smith appeared less certain. Cost was one consideration. The previous year both states had attempted to obtain a federal grant of $6 million, which would have covered half the estimated total of $12 million, but the U. S. Senate had blocked that option.24 Now the two states would have to foot the entire bill. In view of the cost, Smith was interested in discussing local sentiment and political risks and benefits before taking a firm position. Most of the evening was devoted to the tunnel project, while the Port treaty lay unattended. To Cohen, this seemed a strange way to proceed: The Hudson tunnel was only a small matter, a single project. Far more significant was the creation of a new bi-state Port Compact, with all the improvements in the region’s economy that would follow. Yet this important step was left to the hind end of the meeting.25 Finally discussion turned to the draft treaty. Some of the state legislators were interested in exploring what would happen after the Port Authority was created—what projects would it undertake, and what recourse state officials would have if they disagreed with its plans. Cohen knew that an attempt to go into these issues would simply raise the size of the Port Authority target, providing more reasons to stifle his creation before it emerged into the world. With the able collaboration of Al Smith, Cohen attempted to deflect questions that went beyond the “simple matter” of creating a bi-state agency. Ultimately, however, the legislators’ concerns were not surmounted; before the evening was over, a bi-state legislative commission had been appointed to review the treaty, and Cohen’s text was submitted to its tender mercies.26

Hobbled by a Bi-State Commission After a series of public hearings and private meetings held by the review commission, Cohen’s proposal emerged a pale shadow of its former self.27 All of the regulatory and enforcement powers (listed above as A through D) were stripped from the proposed Port Authority, and some were converted from powers to shackles. In Cohen’s draft, for example, no change in any Port development plan, once approved by the two states, could be made except “by and with the approval of the Port Authority”; in the revised version, no

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changes were permitted except “by and with the approval of the Legislatures” of the two states (new Article IX).28 The revised Article VIII no longer gave the Port Authority power to block the states from making land grants; instead, Article VIII provided that all terminal or railroad activities of the Authority would be under the control of the utility commissions of both states, which would treat this government agency as if it were simply a “private corporation.” Also, the new agency could no longer propose regulations which would be binding through local inaction or court approval; both state legislatures would need to approve any such regulations, and the two states would decide on penalties for violations (Articles XVII and XVIII). Finally, the bi-state commission modified two sections of Cohen’s draft which focused on the Port Authority’s ability to acquire and operate transport projects. Under revised article VI, the new agency was barred from exercising any of these powers until the two state legislatures approved a “comprehensive plan” for port development; so Cohen’s wall—separating approval of the Port Compact from discussion of specific Port Authority projects—had been breached. And Article VII, which provided that the new agency would have such additional powers and duties “as shall hereafter be delegated to it” was modified to read “as shall hereafter be delegated to or imposed upon it” (emphasis added). While of little import legally, the new phrase conveys a sense of punitive intent by a legislative body bent on ensuring that Cohen and the bi-state study commission got the message: the new Port Authority would be commanded by the two legislatures and the states; it would not give the commands. Other elements of Cohen’s original draft—creating the new agency under the Compact Clause, for example, and permitting it to petition state and federal regulatory commissions—remained; but these seemed to offer little threat to the existing pattern of state powers and prerogatives.29

Attacked by Tammany The revised draft was completed in late February, and during the next several weeks there was a flurry of activity which included elements both promising and foreboding. The most positive happening was the steady progress of the bi-state effort to construct a vehicular tunnel—or a “wagon tunnel” as the New York Times persisted in calling it—under the Hudson. By the end of March the legislatures of both states had approved bills authorizing an underwater crossing between Canal Street in Manhattan and Jersey City; it would be built under the supervision of two state commissions, working together. Al Smith still hesitated, however; and in early April he convened a

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public hearing in order to gauge sentiment for the tunnel and its twelve-million-dollar cost. The project was widely supported by city and state interests, although the fervid opposition from Queens served as a reminder that New York City was a house divided, when cooperation was proposed with that alien land across the Hudson. On April 8 Walter Edge signed the bill providing funds for the tunnel, and Al Smith concurred three days later. By early June, the two commissions, meeting jointly, began their preliminary work, and in July they organized as a single body and appointed Clifford M. Holland as Chief Engineer. The cause of bi-state cooperation had received a significant boost.30 Far less encouraging were the fits and starts on the Port Development plan itself. When the revised draft was completed in late February 1919, Mayor Hylan’s representatives on the bi-state review commission tried to delay publication of the new draft so that New York City officials could undertake a “further investigation.” But other commission members rejected that ploy, and the legislative commission released the modified draft, which had the support of most commission members, on March 1. However, the bi-state treaty faced a complex political situation. In the business communities of both states, and among Republican leaders in the state legislatures, traffic congestion and the declining portion of national freight attracted to the New York region were major concerns. The modified Port Authority proposal seemed an important step toward meeting these problems, and it won their support.31 But New York City’s elected officials were still unwilling to endorse the treaty, and while their opposition could be overridden in the state legislatures, that was not an attractive step politically. For 40 years, Gotham had engaged in active planning along its waterfront; it had built and financed major improvements; and it owned more than half of the waterfront area in the entire Port District. A state bill that appeared to strip away important development powers from New York City might provide an excellent campaign issue for the opposition; for there was some doubt that local voters in New York City and beyond were ready to embrace the political philosophy of the Brooklyn Daily Eagle and the New York State Chamber of Commerce—that vigorous action to modernize the port was more important that home rule. Moreover, the Republican legislators now faced a Democratic governor, whose strong political ties to New York City made him reluctant to override the city’s elected leaders. So the joint review commission decided to refer the March 1 draft to Mayor Hylan and his city colleagues. The commission’s letter of transmittal was in some ways an extraordinary document. Sent by a bi-state group that

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wanted to take prompt action to create a Port Authority, it went to a group of local officials who were known to be adamantly opposed to any ceding of municipal powers—and yet the letter was so phrased that it could easily be viewed as giving those local officials a veto power over creation of the bi-state agency: “The members of the Legislature of this State are unwilling to proceed . . . until the City of New York, through its elected officials, has made its position . . . definitely known. The responsibility of the acceptance or rejection of the proposed comprehensive scheme must now rest with the City of New York.” It was not surprising that Hylan and his aides thought they were in control and could throttle the dangerous babe aborning.32 In late March, the Board of Estimate—the city’s governing board—held a hearing on the revised draft. Julius Henry Cohen urged the Board to endorse the treaty. If the bi-state compact were not approved, he argued, New Jersey would proceed on its own with a plan of port development, in time draining commercial traffic away from the eastern side of the Hudson; in addition, the ICC might decide to reopen the New York Harbor case and grant New Jersey a lower freight rate, which could be calamitous for New York’s economic vitality. But Mayor Hylan and his Tammany associates were not in a cooperative frame of mind. They argued that the city Board of Estimate should have a controlling voice over all actions of the Port Authority, perhaps by giving them two or three of the six seats on the Authority’s governing board. Moreover, Hylan noted that the New Jersey portion of the proposed Port District included only 2 million people, while the New York portion had 7 million; therefore it seemed unreasonable to him that New Jersey should have equal representation with its bigger brother. The Board promised to provide a fuller statement of its views soon after the hearing.33 In early April, Hylan and his associates responded in detail to the bi-state Commission’s plans, in effect kicking sand in the eyes of those who were seeking cooperative relations across the Hudson. They pointed out that New York City had made “great progress,” acting on its own, in developing its waterfront; meanwhile, the cities of New Jersey and the state government had been inactive, neglecting their harbor resources. The Hylan team urged that attempts to cooperate with New Jersey be expanded to include ways to end “the poisonous fumes generated in the factories or plants situated on the New Jersey shore.” Finally, city officials opposed any action to create the Port Authority—and to grant it “such vast powers for all time”—until the detailed plans for physical improvements in the region could be studied with care.34 As these unproductive negotiations trudged forward, Walter Edge resigned as governor and departed for Washington to take up his seat in the

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United States Senate; and so Cohen and his colleagues on the Port Commission lost the final member of that triumvirate which had strongly encouraged their efforts in the happier days of 1917.35 Meanwhile, the two state legislatures had concluded their sessions for the year, and the fate of the treaty and bi-state cooperation was deferred once more—until the lawmakers convened again in Albany and Trenton, early in 1920.

Tied to the Masts of Local Politics As Cohen and his bi-state study commission looked to the new year, the fate of the Port Compact—and all the improvements in the region’s economy that would follow—appeared to rest largely in the hands of Al Smith. Smith was a friend of Cohen’s and a friend of regional cooperation and the “Port Authority idea”; but he was also partial to home rule, especially for New York City. He believed the city had the right to decide how its own resources would be developed, particularly on the issue of harbor development— where the long record of city involvement was active and constructive, a matter of much civic pride. The issue, then, was whether Al Smith could, in collaboration with Cohen and state legislative leaders, persuade city officials to accept some version of the Port treaty. In 1919, Smith had appointed Hylan’s Dock Commissioner, Murray Hulbert, as a member of the bi-state Commission, in the hope that this step would help to bring a rapprochement between the city and the bi-state agency. Then, in the waning months of 1919 and early 1920, Smith and Cohen and the legislators worked out changes in the 1919 draft which would meet the objections raised by Hylan and his colleagues. Two crucial modifications were made in the treaty, in order to protect the city’s interests: 1. Article IV was altered to give City officials substantial influence in selecting New York State’s members on the Port Authority governing board. In making the three initial appointments, the governor would be required to select two from a list of five names provided by the City’s Board of Estimate; and thereafter, two of the three would always be chosen from “resident voters of the city of New York and recommended by the municipality of the city of New York.” 2. Article X was altered in order to permit New York City and all other cities in the District to control Port Authority activities within their borders. “No city . . . shall be bound by the comprehensive plan,” said the

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new draft, “unless and until” it had approved of the plan; and no change in the Port Authority’s plans could be made unless it had obtained the approval of the municipalities “directly affected by such modifications.”36

In March 1920 the bi-state Port commission forwarded this revised version to the governors and legislatures at Albany and Trenton; they asked that the Port Compact be approved in this form. The commission argued that the proposed treaty “now safeguards the interests of all the municipalities and recognizes the principles of local self-government that are applicable,” and they urged that “local jealousies, fears and policies” should “give way to the good of the whole.” However, Hulbert, Hylan’s ally, refused to sign the report.37 Now Governor Smith broke with his city compatriots and asked the legislature to approve the revised treaty. The latest changes, he believed, provided reasonable safeguards to New York City and the region’s other towns; and unless a bi-state compact was approved promptly, the economy of the state and the region would suffer great harm. “Action,” he concluded, “is imperative.”38 But to Mayor Hylan and some of his colleagues, a plea for cooperation was like waving a red flag before a bull. Hylan attacked the new bill as “simply another method of grabbing the Port of New York” from its citizens; he was sure that “foreign interests” which wanted to buy up the waterfront were behind the plan; and his colleagues from Queens and Brooklyn urged the city to resist, lest a bi-state treaty be the death blow to great port improvements in their own Jamaica Bay.39 Meeting on April 16, the Board of Estimate voted unanimously to reject the proposed treaty, which would create a “wholly independent commission or corporation” with “unlimited powers”—an agency freed from “all responsibility . . . to those over whose property, money, rights, and conduct they are given jurisdiction.” The Board denounced the two concessions made in the latest draft: the opportunity for city officials to nominate two of the three New York State commissioners was “of little value,” the Board argued; and local approval of Port Authority plans would mean “nothing whatever” on the crucial issue—the question of “when the parts vitally affecting the City of New York would be carried into effect.”40 In general, Hylan and his allies objected to the creation of agencies which are partially insulated from control by elected officials as “contrary to the very fundamentals of our government”; on this issue, the city position was sharply different from that of Julius Henry Cohen.41 The Hylan Administration also took this opportunity to underscore its attitude toward that smaller state to the west. “The principle of co-operation is

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flouted” by the proposed treaty, the Board of Estimate argued, because harbor and river pollution are not included. So New Jersey would retain “the right to continue to pollute the waters of the harbors and rivers around New York with undiluted and unlimited sewage, and for its acid factories and oil refineries to pour forth without restraint the fumes and gases that are so highly objectionable and injurious to the citizens of New York.” Moreover, the Port Authority might sell its bonds, “secured by mortgage upon property in the City of New York,” and use the proceeds to make improvements in railroads and to carry out other major projects only in New Jersey. Thus the Port agency might do great and continuing injury to New York City in its competitive battle to remain the nation’s premier port. Finally, advancing an argument that would frequently be heard 30 and 40 years later, the Hylan Administration pointed out that the treaty provided no means by which “the surplus profits” amassed by the Port Authority in its regional projects could be distributed to the city and the two states. Instead, the Port Authority might continue to gather profits “without limit” and use them in any way its officials saw fit.42 By this time, Al Smith and the Republican legislative leaders were losing patience. They had made important changes in the bill in order to meet New York City’s earlier criticisms; they had delayed acting on the issue for more than a year; and now Hylan and his associates had responded to their efforts with scorn. Meanwhile, the New Jersey legislature had carried out its part of the bargain; the revised treaty was approved by the Senate on April 12, 1920, and the Assembly concurred on April 15. In Albany, the Senate Judiciary Committee held a hearing on April 20, where they heard vociferous attacks on the Port Compact from Mayor Hylan, together with the Borough Presidents from Queens, Staten Island, and Brooklyn, and other city officials; and strong endorsements by the New York Chamber of Commerce, the Citizens Unions and other civic groups. State officials now appeared ready to approve the legislation.43

Blocked by New Jersey’s Democrats Before Albany officials could vote, however, a swift blow from Trenton brought proceedings to a halt once again. Walter Edge’s successor as governor, Edward I. Edwards of Jersey City, sharply criticized the Port Compact—and then he vetoed the bill. To some New Yorkers, it must have seemed as though a measure of John Hylan’s gall and brimstone had wafted across the Hudson. But in fact the

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causes of the new attack, which was centered in Jersey City, were deep-seated. With 300,000 souls and a location on the River directly opposite Manhattan, the state’s second city (behind Newark) had traditionally been a hotbed of resentment toward New York City’s economic dominance, her cultural imperialism, and her view that the harbor was New York property. In 1916, one of its native sons—James Fielder—had been in the governor’s chair, and Jersey City and Fielder had led the attack in the New York Harbor case. During the next three years, however, that urban center and its Democratic majority had little voice in shaping state policy, as Republican governor Walter Edge and his party’s legislative leaders carried forward a policy of cooperation with New York’s mercantile class. Meanwhile, Frank Hague had gathered the reins of power in Jersey City, and in 1919 he supported Edwards for the governorship. Edwards’ win in November helped to give Hague a dominant role in Democratic state politics, a position he would hold for 30 years.44 Edwards, Hague, and a large segment of the vocal Jersey City community objected to the Port treaty. Narrow political concerns played some part in their opposition, for the opportunities for Jersey City political leaders to obtain jobs and contracts would be constrained if major public works were controlled by a bi-state authority. However, what was true in New York City was also true in this smaller but proud municipality as well: a fair portion of Jersey City’s leaders preferred independent action, and saw the city’s economic potential and political vitality threatened by a bi-state agency whose leaders were chosen in Albany and Trenton. As Frank Ferguson, a leading figure in the local Chamber of Commerce, later commented, he was convinced at the time that it would be far better for Jersey City and her sister communities to develop their own waterfront areas; following that route, New Jersey “would come into . . . her destiny.”45 The Republican-dominated legislature had listened more closely to the business and civic groups from the suburbs and cities, and there they had found widespread support for the Compact and the economic benefits it might bring; so they had endorsed the bill now vetoed by Edwards. In his veto message of April 21, Edwards argued that the treaty and the Comprehensive Plan should be considered together; if there were objections to specific parts of that plan, they should be worked out before the Port Authority was created. Edwards was urging exactly the approach that Cohen was anxious to avoid; to consider the detailed physical plans jointly with the Port Compact would be likely to stimulate more criticism of the entire enterprise, reducing the prospects that the Port Authority would ever be created.46

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“Faint heart ne’er won fair lady,” but the New York Times quickly succumbed to Edwards’ opposition. “The battle of the port is ended,” the Times concluded after Edwards’ veto. “It will be in vain to start anew next year with the New York bill; New Jersey must be wooed anew, and with remoter prospects of winning.” The “harm that they have done will live after their official lives are ended,” concluded this modern Marc Antony; “New York will have a rival where it needs a partner, and the nation will lose a port which should be the world’s greatest.”47

Revived by a National Election The Times’ pessimism did not infect Cohen, or Al Smith, or their friends on the bi-state commission. They could see that pressure for action would continue to build, as traffic congestion in the New York area generated complaints of high cost and also diverted foreign trade to other ports. In fact those problems did continue to occupy the attention of business associations and the press; and during the fall of 1920, Cohen took to the hustings, urging action. Invading the sometimes hostile territory of Queens, he pointed out to the local Chamber of Commerce that New Jersey was preparing to develop its own piers; “unless New York City and Queens Borough in particular take immediate steps” to provide modern docks and transfer systems, Cohen concluded, “the business will go to New Jersey.” The best solution was support for the Port Compact, he argued, which would keep the Port of New York united and prevent traffic from going not only to New Jersey but to “Montreal, Galveston, New Orleans and other ports.”48 Then national politics, and perhaps national malaise, lent a hand to Cohen and his bi-state band. In the November 1920 presidential election, Warren Harding and Calvin Coolidge were swept into office by large margins, carrying with them Republican candidates of various hues for national and state offices. In New York, Al Smith was running for his second two-year term as governor, and with widespread support across the political spectrum he ran 1,090,000 votes ahead of the national ticket. But that was not quite enough; in the Harding landslide, Smith lost to a moderate Republican, Nathan L. Miller, and both houses of the legislature in Albany returned solid Republican majorities. Across the River, Democrat Edwards would remain in office until early 1923; but as a result of the 1920 election, he would now confront an overwhelmingly Republican legislature.49 Looking ahead to the 1921 legislative term, the bi-state commission could now see more promising prospects. Al Smith might be hesitant to take power

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away from New York City’s elected officials, but the new governor was from upstate New York and had no ties to Hylan and his Tammany cohort. Miller would have to be convinced of the value of a bi-state treaty, and then the Albany legislature could be expected to follow his lead. In New Jersey, Edwards was still an obstacle, but suburban and downstate Republicans had enough votes to override his veto. During the past two years, Nathan Miller apparently had not followed the debate on the problems of the Port and the proposed bi-state treaty. Soon after the election, however, he did attend the annual dinner of the New York Chamber of Commerce. In view of the Chamber’s abiding interest in the problem of bi-state cooperation, it may have been natural—and it was surely opportune—that during the banquet the Chamber’s president asked its general counsel, still Julius Henry Cohen, to “take half an hour to outline the plan of the Port Compact and the Port Authority.” As Cohen recalled the situation, Miller then asked him to “come to Albany and go over this thing with me.” Cohen did so, soon after Miller took office in January, and the new governor expressed his strong support for the Port Authority idea.50

What Survived: A Toothless Giant In January, 1921, the bi-state Port and Harbor Development Commission released its final report.51 The Commission noted that a bi-state Port District had been proposed years earlier, in 1905, to solve the problem of harbor pollution, but that idea had led to “no practical results”—only to endless litigation. It expressed the fear that its own studies might be no more productive, unless a permanent Port Authority were soon created, and the two states were committed in a “firm, resolute and definite understanding” to meet the complex challenge of modernization in the Port region. The Commission pointed out that its initial proposal, two years before, had been to construct a Port Authority with “adequate powers to carry out a comprehensive plan” once the two states had approved the plan. But that proposal had met with “considerable opposition,” especially from New York City officials, and so the current proposal would create a more modest agency, which would “leave the local authorities with large freedom.” The study commission suggested that the legislatures might wish to “restore some of the powers originally proposed and remove some of the limitations” added in 1920; then a “more efficient Port Authority” would emerge—one which could provide “unified and rationally directed effort” to improve the nation’s premier port.52

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While the Republican leaders in both states reviewed the Commission’s final report and the draft legislation, Cohen and his fellow advocates for a bi-state treaty were now joined by Al Smith. Having been relieved of his duties as governor, committed still to finding ways to overcome the problems of congestion and cost that burdened the New York region, Smith spoke before business groups in the city and urged them to support the Port Authority idea.53 In mid-February, following discussions among Governor Miller and legislators in both states, the Port Compact once again made its appearance. To the disappointment of Cohen and his Commission colleagues, none of the regulatory powers in Cohen’s December 1918 draft were restored, and all of the constraints the Legislative Commission had imposed on the Port Authority’s work in the spring 1919 version were retained. On the other hand, those who redrafted the Compact were even less sympathetic to Mayor Hylan and his cause. Having resisted compromise, having attacked those who were reluctant to cede the city full control over the port, having scorned the efforts of Al Smith to give them some power over the selection of the Port Authority’s leaders, Hylan and his allies now faced hostile legislators and an impatient Republican governor. The new legislation stripped away the concessions that had been made to New York City and other cities in the 1920 bill. The 1921 version was essentially the same as the draft agreed to by the bistate review commission in the spring of 1919.54 On February 16, Governor Miller sent a special message to the state legislature, urging that “no narrow or provincial view . . . be permitted to delay action,” and that the Port Compact be quickly approved, despite the city’s opposition. Miller and his aides also criticized the Hylan Administration’s operation of the city’s rail transit lines, and they urged the creation of a State Transit Commission which would take over responsibility for planning and regulating the transit system. These twin assaults against home rule provided Hylan and his colleagues with much to rail against. The City Controller complained that the governor and his legislative allies “seek to supplant the regularly elected officials of the city” by state commissions which would “exercise unlimited powers without regard to the rights of the city.” One of Hylan’s allies in the state senate compared Miller’s approach to self-government to that of Lenin and Trotsky. And Hylan threatened to sue the state in order to block the loss of the city’s rights.55 Meeting with a delegation of business and civic groups from New York City, all of them asking for prompt action to approve the treaty, Miller defended state intervention in municipal affairs. “I believe in the greatest mea-

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sure possible of local self-government . . . compatible with good government,” Miller explained. But the citizens of New York City were now burdened, he argued, with a local government which suffered from “inefficiency and incompetence.” Governor Miller concluded: The municipalities have been created by the States. They are the mere creatures of the States, and when it becomes necessary for the State to step in to rescue those people in their own interests, the State not only has the power, but, in my judgment, it is the moral duty of the State to do it.56

By mid-March the Republican leaders in Albany had lined up their colleagues behind this moral duty, and the New York bill was passed by the Assembly on March 16; a week later, the Senate followed suit. The Democrats in the legislature voted in a bloc against the bill, and all the Republicans in both houses supported the Compact, with two exceptions: finding their local constituencies in opposition, the Republican state senators from Brooklyn and Queens voted to reject the bi-state treaty. Meanwhile, across the Hudson Governor Edwards once again opposed the Compact, but the Senate and Assembly passed the bill almost unanimously; and when he vetoed the measure in early April, they promptly overrode his veto. To prevent Edwards from undermining the new agency by naming commissioners who opposed bi-state cooperation, the New Jersey legislation listed the three men who would hold office in the first years; they were the three New Jersey members of the bi-state study commission.57 By early April both states had completed action on the Port treaty, and as they prepared to join together in signing the Compact, Governor Miller still had a decision to make: whom should he appoint to the Port Authority board? One choice was easily made—Eugenius H. Outerbridge, leader of the Chamber of Commerce campaign for a bi-state effort, and the most active commissioner on the study commission during the past four years. For the second place he chose a Brooklyn businessman, Lewis H. Pounds; the local Chamber of Commerce had opposed the treaty, and Pounds might persuade that Borough’s wary business leaders to accept a bi-state approach to port improvement. The third New York position on the six-member Board should, Miller thought, go to a Democrat from New York City; but should he ask the study commission’s only Democrat, Hylan associate Murray Hulbert, to take that appointment? The governor conferred with Cohen, who advised against it, since Hulbert and the New Jersey commissioners had often been at loggerheads, and since Hulbert had thus far refused to endorse the

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Port Compact in its final form. Cohen suggested that Miller ask a “bigger Democrat”—Al Smith. Miller asked Smith if he would accept appointment, and Smith said he would.58 On April 30, 1921, public officials and business leaders from both states again converged on the Great Hall of the New York Chamber of Commerce in downtown Manhattan—as they had in March 1917, when Governors Edge and Whitman had urged the creation of the bi-state study commission, and as they had in December 1918, when Edge and Whitman had urged prompt action on Cohen’s proposed treaty, with its sharp regulatory and planning teeth. Now the occasion was the signing of the Port Compact, and Walter Edge returned from Washington to take part in the ceremonies. His successor, Edward Edwards, declined to attend, and the state’s Attorney General signed for New Jersey. From New York, Governors Miller, Smith, and Whitman were all present. But New York City’s major officials—the Mayor, the Borough Presidents, the other members of the Board of Estimate—refused to take part.59 The Port Compact was signed that day, and the Port of New York Authority takes its birth date as April 30, 1921. The treaty then went to Washington with Senator Edge, where it received the consent of Congress under Article I, and President Harding signed the joint resolution of consent on August 23. Now the two states and the nation had agreed to a policy of cooperation in a Port District reaching far into New York and New Jersey, and a new agency stood poised to carry that policy into execution.60 But what kind of an agency had been created? Something far less powerful than Julius Henry Cohen had intended. Perhaps it was no more than a toothless giant. A giant it surely was, at least in geographic scope. The Port Authority would operate in a Port District extending roughly 25 miles in all directions from the Statue of Liberty—across 1500 square miles of land and water in two states. The District included the nation’s largest city, plus two others with populations exceeding 300,000—Newark and Jersey City—and more than 300 smaller cities and towns in 17 counties (the five counties of New York City, plus portions of 12 others). The Port District included the most populous parts of both states, with a 1920 census exceeding 8 million. In terms of shipping, railroading, and commercial activity generally, this was the nation’s premier area, and its international trade made up more than 40 percent of the nation’s total. What powers did it have as it watched and patrolled this terrain, and made plans to modernize the piers and lighterage system, improve efficien-

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3-1. The Port of New York District, created in April 1921. The district includes the region's main waterways, the five counties of New York City, and portions of nine counties in New Jersey and of three counties in suburban New York State.

cy, and so reduce congestion and the cost of food and other goods and stimulate economic growth? Under the Port Compact, the Port Authority had the power to build, buy, and lease terminal and transport facilities throughout the Port District, the power to operate these facilities, and the right to levy charges for the use of any piers, rail lines, ferries or other facilities it controlled. It was prohibited from levying taxes, however, so it was not clear how it would obtain the resources to build and buy.

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The most promising route was to issue bonds—another power granted to the Authority—and use the proceeds to acquire or construct the needed freight tunnels, modernized docks, and other projects. But Port Authority bonds could be sold only if investors believed the agency would be able to operate the new enterprises on a break-even basis with a slight surplus; and that could be expected only if the railroads and other private interests agreed to use these new and modernized facilities, and if the cities of the region agreed not to build competing piers and rail lines. In Cohen’s 1918 draft, the Port Authority was provided with the regulatory powers which might have encouraged and even forced the railroads and the cities to yield their narrow, competitive perspectives—so that their energies would be guided by a rational plan for port and regional development. But those sharp teeth had been pulled out, in the dental operation executed by the review commission in 1919. Under the 1921 Compact, the Port Authority had lost the power to block new piers and other developments by local interests that might compete with its own plans; and if they wanted that power returned, they would have to appeal once more to the state capitals. Moreover—regarding the crucial issue of cooperation by the railroads—the Port Authority could make progress only if it could persuade them to abandon the philosophy of individually owned, competing terminals and rail lines by which they had traditionally lived, or if the Authority could persuade the ICC to step in and force the railroads to set aside their individual profit-seeking strategies in order to achieve the common good. And all this must now be done in a new era, the Harding era of laissez faire. The Port Authority’s teeth were hard to find, and it was not clear that a stronger set would be provided, at least in the years just ahead. But the new agency did have, at least, some advantages in vision—some ability to see further than the next election, some capacity to consider policies which might serve a wider interest than that of Jersey City alone, or Brooklyn alone, or New York City, or the counties of Northern New Jersey viewed in isolation. Perhaps, however, the system for selecting Port Authority commissioners was more unhinged from local sentiment than was desirable. An argument might be made that New York City’s elected officials deserved a direct or indirect role in selecting New York’s Board members—so that they could feel confident the Port Authority would pay due regard to the city’s long record of achievement, and so that the city’s own constituents would not greet Port Authority plans with suspicion. At other times, with other leaders, New York City might have obtained what its officials sought, what Al Smith and at one time even Republican leg-

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islators seemed ready to give it—an authoritative voice on the Board. But John Hylan and his Tammany-bound colleagues sacrificed that goal, with its prospects for combining effective action with responsible governance, to their immediate concerns. By championing the particular fears of the city’s outlying boroughs, they had gained some advantage in their short-term quest to stay in office. And in the short run perhaps they felt vindicated. A few months after the Compact was signed, in November 1921, Hylan and his team were reelected; and before and after that election they were able to use the Port Authority and its plans as a sort of bogeyman, whose dangers to the Greater City permitted City Hall to show its own redeeming courage.61 Only later, when Al Smith blocked Hylan’s plans for a third term as mayor, and his hopes for higher office were scuttled too, could one say that Hylan may have misread History’s lessons for his own career and power.62 Meanwhile, by their rhetoric and behavior Hylan and his colleagues had conveyed the message to business and civic leaders in the city, and to Republican leaders in Albany and beyond, that they could not rely on the city’s politicians or the majority sentiment of her voters if they hoped to achieve effective and responsible political leadership. Reformers like John Purroy Mitchel would be turned out of office, the record showed, and men like Hylan would take their place, and then—by posturing, by denigrating their opponents and even those who sought compromise—be reelected. So effective action to meet complex issues—the city’s transit difficulties, the harbor problems of city and region—required that the city be denied a leadership role. This was the lesson for Governor Miller, for the Citizens Union and the New York Chamber of Commerce, for Julius Henry Cohen. And the Republican leadership at Trenton saw similar weaknesses in Jersey City’s politicians and their state representatives.63 Of course Cohen had hoped for much more than simply insulating the Port Authority from the vagaries of local politics. His mind had been commanded by a vision of vigorous police powers over local development plans and over railroad operations; he had sought a port authority with wide-ranging powers, like those at Liverpool and London. If he thought that those histories offered feasible models for the politically complex New York region, he was deceived. But he was not, really, deeply disappointed. Child of an age of optimism, Cohen could see that some useful step had been taken, and that a new agency would now bestride the Hudson and seek harmony across states and cities, among private corporations and public agencies, and so in time help to modernize the Port and its hinterland. And if important powers

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had been cut off in the four-year struggle to bring this new creature into being, perhaps they could be reclaimed. It is not surprising, then, that hopefulness—perhaps aided by some rosetinted glasses—is what the Port Authority’s parent of law conveyed when he rose to speak at the Bar Association meeting, four months after the Compact was signed. Acknowledging that the Port Authority had been given no power to create regulations within the Port District, no power to veto any local plans, no power to tax and no power of eminent domain, Cohen saw the power to “borrow money upon its own bonds” as the agency’s great advantage. He envisioned a Port Authority that would encourage and finance, and perhaps itself build, great new piers and other projects, to be paid for by leases “that will insure a revenue adequate to pay off operating expenses . . . and amortize the principal in from thirty to fifty years.” Moreover, the Port Authority would be “the cooperating agency of all of the railroads” and with their agreement “build and operate a joint terminal system.” Indeed, that important step seemed very likely to Cohen; for he reported that the railway executives “of the twelve great trunk lines . . . already indicate that they appreciate the great opportunity afforded through . . . the Port of New York Authority for a scientific handling of the problem . . . .” And, looking west, Cohen could see that the principles of interstate cooperation set forth in the Port Compact would encourage similar steps in other regions; already seven states were moving to establish a Compact on the Colorado River.64 So Cohen’s restless imagination, and his search for signs that constructive cooperation might in time rule large portions of the world, won out over partial defeat. And he could look forward to the coming decade hopeful that the modest victory gained so far would be followed by still greater victories in the battle of New York harbor. And so it would. But not quite in the way that Cohen imagined. The 1920s would see complete failure of all of the Port Authority’s plans for coordinating rail freight, and for modernizing the piers and constructing rail tunnels that could join Manhattan and Brooklyn to the mainland. And while Cohen and Outerbridge and their planners were occupied in that frustrating arena, the 1920s would see another pair reaching out to claim Cohen’s bistate agency as engine and beneficiary of a new automotive age.

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Part Two

Failure and a New Beginning

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4 Modernizing the Rail System Contending Strategies for an Expanding Metropolis

[There were] two competing political systems in modern America. On the one hand, the spirit of science and technology, of rational system and organization, shifted the location of decision-making continually upward so as to narrow the range of influences impinging upon it and to guide that decision-making with large, cosmopolitan considerations [and] technical expertness. . . . On the other, however, were a host of political impulses, often separate and conflicting. . . . Their political activities sustained a more open political system, in which the range of alternatives remained wide and always available for adoption, in which complex and esoteric facts possessed by only a few were not permitted to dominate the process of decision-making, and the satisfaction of grass-roots impulses remained a constantly viable element of the political order. —Samuel P. Hays1

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his was the tension—between the ideals of rational planning and the jumbled play of local political forces—which shaped much of the Port Authority’s experience throughout the 1920s. The new agency itself embodied the ideal of technical rationality, of relying on experts who focused on complex technologies and on large regional and national needs, and who gave little weight to the parochial interests of individual towns and cities. With its commissioners chosen only by the two governors, and with its funding not dependent on local appropriations, the agency had a significant degree of formal insulation from local officials. And the Port Authority’s Comprehensive Plan, handed down in late 1921, would underscore “the spirit of science and technology, of rational system and organization” even more dramatically; for that plan was a blueprint for vast new rail and freight-terminal investments across the bi-state region, affecting the economic growth and social patterns of hundreds of local communities and thousands of people—a blueprint to be shaped mainly by general principles of coordination and efficiency. 77

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On the other side stood an array of political officials and other citizens in Brooklyn and Staten Island, in Jersey City and Hoboken and the other towns of Hudson County, in Newark and Elizabeth and beyond. These community leaders and their allies at the state capitals viewed the Port Authority as a threat to local democratic control, and a danger also to local economic vitality. Deeply suspicious when they saw Cohen’s artful designs, they had reached out to curb his expectations, and their jealous grasp had nearly throttled the menacing babe at birth. They fought sporadically against the agency and its plans in the 1920s, as they would battle the Authority’s forays into airports and waterfront development through the 1940s and into later decades. It would be inaccurate, however, to view the tension as a simple conflict between those who favored centralization and expertise (here represented by the Port Authority) and those who embraced localism.2 To the champions of Brooklyn and Jersey City—and to those who fastened on the special development opportunities of Jamaica Bay and Newark’s waterfront—the Port Authority was a centralizer, using plans devised by specialists to strip from local citizens the power to decide their own economic and political fate. But throughout the 1920s, the bi-state agency also fought to wrest control of rail policy from the national centralizers—the Interstate Commerce Commission in Washington, with its stable of experts and its allies in the railroad industry—so that the New York metropolis could take responsibility for its own regional transportation system, and thereby strengthen its own economy. From this perspective, the Port Authority was an advocate of decentralization. Moreover, the spirit of “rational system and organization” which animated the Port agency’s staff was directed most vigorously and critically against the national and regional railroads, whose resistance to more efficient ways of operating seemed (to the Port Authority, and to some outside observers) to weaken the New York-New Jersey economy, and to provide an unparalleled example of self-interested, parochial behavior. Furthermore, in constructing the Comprehensive Plan the Port Authority had consulted with a variety of local officials and civic bodies, and the plan proposed by the bi-state agency appeared to be sensitive to their concerns. Many of its later plans—in the 1920s and beyond—would also win support from some local officials and citizens. At times, this applause simply showed a readiness to embrace economic-development gains, even if they were coupled with a loss of democratic participation in shaping the projects that would fundamentally alter the local community. But on other occasions, local enthusiasm was grounded in an expectation that better rail facilities, new bridges, and modernized marine terminals would also mean a growing

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population and a stronger financial base, which together would stimulate constructive community planning—on ways to improve local highways, parks, schools, and hospitals. And so local citizens might have more scope for their own thinking, and more opportunities to shape their expanding towns and cities. Many of these complexities in the relationships between community initiative and wider regional planning, between popular preferences and analysis by experts, were not yet evident as the Port Authority began its life in the spring of 1921. Nor could the new agency’s officials pause to reflect on these issues, for they were at once confronted with a specific task, and a deadline only a few months away. In approving the bi-state legislation, the state legislatures had agreed that the Port Authority’s most general mission was to enhance cooperative planning and economic development in the bi-state region; but they had commanded the agency as its first priority to prepare a detailed set of proposals to improve the railroad freight system, and thereby to help reverse New York’s deteriorating position in international trade. And they had put the Port Authority on a very short tether: It was required to produce an explicit plan in less than nine months—by January 1, 1922.3

Alternative Blueprints for an Expanding Metropolis Even before the agency’s first meeting, in April 1921, there was wide agreement among the staff and commissioners as to the major weaknesses in the region’s freight transport system. These had been examined with care in the work of the bi-state study commission, and set forth at great length in the commission’s “Red Book,” published in 1920; and most of those who had worked on that study continued on, as leaders and staff of the agency they had urged be created. Also, there was a substantial consensus—within the Port Authority and among other observers of New York’s chaotic transport system—regarding the two general principles that should be applied in order to solve the region’s problems: 1. The massive array of railroad lines, rail terminals, and marine terminals in the region should be reorganized into a single, unified system, so that freight could move efficiently from Chicago and other western points to and from any of the communities in the Port District along the fastest and most economical route—avoiding the delays and high costs that now occurred, as each railroad tried to maximize the distance

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that freight traveled on its own line (and thus maximize its individual corporate profit).4 2. Because much of the freight traveling from across the continent into the New York region was bound for final destinations in Manhattan and Brooklyn, or for ship terminals along those shores, any plan for improvement would need to include ways to overcome the wide rivers and bays that interfered with efficient freight movement from the Jersey shore to New York’s shops, industries, and piers. This would almost certainly require large capital investments—probably to construct tunnels or bridges across the Hudson River and New York Bay, so that railroads could go directly from northern New Jersey to destinations in Manhattan, Brooklyn, and Long Island.5 If these were the general principles for improving transportation and economic vitality in the New York region, there were only a few plans which might achieve those goals, and four deserve at least brief attention here. As it would turn out, not one of these plans has ever been taken beyond the drawing board: they have become casualties of the jealousies that rippled across the cities and states of the region, of the unwillingness of the railroads to cooperate for the region’s benefit (and possibly their own), and finally of the insweep of a new technology, which quickened and consorted with the American passion for mobility. Victims of these recurring themes of American history, the four plans deserve mention because they illustrate quite different images of what the New York-New Jersey region was, and conflicting priorities for her future. One plan was championed by those who saw New York City as a beleaguered contender for regional and national preeminence, and who sought a strategy that would strengthen the economic vitality of her undernourished boroughs of Brooklyn and Staten Island, while keeping competitors from northern New Jersey at bay. A second proposal would have concentrated further development in Manhattan, disregarding the demands of the other boroughs and of New Jersey for larger shares of the regional pie. A third offered the chance to shift future economic growth substantially to the cities and towns of New Jersey. And the fourth, which the Port Authority eagerly embraced, appeared to be the most comprehensive and balanced— though a Newarker might reasonably see it as a New York wolf in rational sheep’s clothing. Four plans headed for the dust bin. But one of them would also serve as a crucial stimulus for a very different project, which would be constructed in

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the next ten years—propelling the Port Authority reluctantly into a unexpected role, as handmaiden to the automotive age, and as powerful engine of that new wave in reshaping New York and its environs. And two others, with their focus on rail-freight tunnels, would rise again at the close of the twentieth century, and capture some corner of the public imagination.

The Narrows Tunnel Plan One of the four schemes would join Gotham’s isolated eastern communities to the rest of the metropolis via a railroad artery under New York Bay at the Narrows. First suggested by William Wilgus, an eminent engineer, and championed by New York’s mayor John Hylan and his political and business associates in Brooklyn and Staten Island, the plan was to construct a 10-mile tunnel under New York Bay, joining the rail lines of Brooklyn and Long Island to the Baltimore & Ohio rail tracks on Staten Island. From the B&O line, which crossed over the narrow Arthur Kill waterway to New Jersey, freight could be transferred to other railroads. Perhaps the plan’s greatest advantage was that it would provide direct rail connections from the rest of the nation to the industries and growing communities of Brooklyn and Nassau County. Moreover, the Narrows rail line would also handle passenger travel, and so it might stimulate considerable residential growth on Staten Island as well. And the rail system could also bring freight directly to Jamaica Bay, where Brooklynites had long urged that extensive marine terminals be constructed—to ensure New York’s continuing preeminence in coastal and overseas trade, and to strengthen Brooklyn’s role in that good effort. But the Narrows plan had some disadvantages too. Its most vociferous advocate, Mayor Hylan, was one of them; in his speeches and in public hearings, he managed to convey a sense that his efforts were motivated less by the benefits of the project than by a passionate desire to block the activities of the Port Authority (whose creation he had opposed), and by antagonism to the “foreigners” of New Jersey (as he called them). Since the Narrows project could not be linked to the nation’s railroads without cooperation from New Jersey, Hylan’s rhetoric undermined prospects for its success. Moreover, the railroads said they would not be willing to use the tunnel— at least not at the level of charges needed to amortize very large capital costs. Despite these difficulties, the city began construction of tunnel entrances in the early 1920s. But Al Smith wearied of Hylan’s attacks on the Port Authority and his bumbling efforts on the tunnel and in other areas; and in 1925,

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4-1. The Narrows Tunnel plan (1920s)

Smith forced him from office. By then, two large and expensive shafts had been dug in the dirt of Staten Island and Brooklyn, using city funds. The tunnel scheme received no further attention in that era, except perhaps as a reminder to the city’s business leaders of the dangers of relying on elected officials for leadership in carrying out complex projects.6 The Narrows tunnel would rise again, however, in the 1980s and 1990s. Then it would be viewed not only as a route to economic vitality in Brooklyn and Staten Island, but also as an important step in alleviating traffic congestion and air pollution, by reducing truck traffic between Brooklyn and points west.7

A Great Bridge at 57th Street A railroad-vehicular bridge across the Hudson River was the centerpiece of the second plan, which had the longest and most distinguished heritage of all the proposals. In 1888, a young engineer, Gustav Lindenthal, had proposed

4-2. The proposed 57th Street Bridge, showing its connections with railroads in New Jersey, and with rail lines to Manhattan piers.

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that a large bridge be constructed to carry the railroad trains that converged on the Jersey shore across the Hudson; the bridge would touch down in Manhattan at 23rd Street. During the next 30 years, Lindenthal had been given a central role in constructing New York’s East River bridges and he had designed the great Hell Gate railroad span. Now one of the world’s distinguished bridge builders, Lindenthal proposed in 1920 that his gigantic Hudson River crossing be moved up to 57th Street, and that it be designed to carry twelve railroad tracks and 16 lanes for motor vehicles. The automotive lanes would enter Manhattan’s streets around 57th Street and 7th Avenue, but most of the railroad tracks would turn south after reaching the Manhattan shore, where they would run near the Hudson River marine piers, and be connected to a series of two-story terminals for off-loading freight to the streets and ships.8 Based on his unhappy immersion in New York politics during his work on the East River bridges, Lindenthal doubted that government agencies were reliable, efficient instruments to carry out large projects. So he had organized a private corporation to implement his plan, and he had obtained a federal charter authorizing him to go forward. The direct connections the Bridge plan would provide between railroads and Manhattan’s distribution systems was a strength of Lindenthal’s scheme. Moreover, there was no vehicular route across the Hudson in 1920 (the Holland Tunnel having been started only in 1919); so the 16 lanes for cars and trucks would offer a real advantage over the slow, overburdened ferries that plied the wide river. With these attractions came some difficulties. A bridge of the size and strength needed to carry railroads across the Hudson would be very expensive, and the cost could be justified only if all the railroads agreed to end their tug-and-lighterage system for bringing freight into Manhattan; but the railroads were wary of making that commitment, in view of the huge cost of the new span. Also, the bridge’s real benefits to the freight distribution system would depend on new freight terminals on the Manhattan side; and the cost of land and construction for those edifices would add millions more to the burden the railroads would have to bear.9 Lindenthal’s proposal might be characterized as a Manhattan-oriented plan, since in operation it would enhance the access to Manhattan businesses and marine terminals from the rest of the nation, allowing the continental railroads to bypass New Jersey terminals, while contributing very little to meeting the interests of Brooklyn and points east. But the offering was too rich even for Manhattan’s blood. Lindenthal’s railroad trains and their associated terminals would have to go somewhere, and it was already a crowd-

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ed island. Also, those 16 lanes of cars and trucks would add measurably to traffic congestion that—even in the early 1920s—was a matter of concern to businesses and civic leaders in the central commercial district. The major business organizations in Manhattan, and the new breed of traffic planners who now worked for the city and for private groups, studied the Lindenthal plan, and they all said it was a bad idea. And when Lindenthal appealed in 1921 to the new Port Authority to endorse his plans, the agency noted that “such a project makes an alluring appeal to the imagination because of its imposing character,” but concluded that its cost, disruption of existing buildings, resulting congestion, and other factors were too great. “We could not adopt it as part of the comprehensive plan in the solution of the freight problem,” the Port Authority’s chairman explained toward the end of the year, as his agency prepared to announce its own preferred program.10

To Give New Jersey Her “Natural Rights” The third alternative, which might be called the North Jersey Development Plan, is but a shadowy figure—a sort of brooding presence offstage, which the Port Authority referred to occasionally, but only as a threat, not an opportunity. The underlying ideas had been sketched out during the work of New Jersey’s own harbor study commissions in 1914–1917, and in New Jersey’s unsuccessful effort to win the New York Harbor case. From those materials and debates, we can give some substance to this ghost which might endanger New York’s dominance in the region’s economy.11 From New Jersey’s perspective, the crucial problem was how to connect the nation’s railroads most effectively to the region’s marine terminals, where freight brought in by the rail network was loaded onto the great fleet of steamships—8,000 of them in 1920—that handled the vast coastal and overseas freight trade. The “New Jersey plan” involved constructing modern rail and ship terminals at Newark and Elizabeth, and along the Hudson River at Hoboken, Jersey City and Bayonne. To carry out this important planning and construction effort, New Jersey might create its own port authority, which would stimulate and guide development along the state’s extensive waterfront; as a result, that underdeveloped land could construct “ample dockage for ships” and “direct all-rail connection with the railroads of the country.” Then the nation’s freight traffic could be handled using direct railto-ship facilities in northern New Jersey—without the expense of building trans-Hudson crossings to send railroad freight across the waters to New York City’s piers.12

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If the New Jersey plan were adopted, some freight deliveries to and from New York’s industries, shops, and piers would still have to be floated across the Hudson and New York Bay. However, that problem would become less important in time, since the major marine terminals for the nation’s goods would be on the New Jersey side of the River, and the new transport system should attract to that state much of the industry that had struggled for so long in the isolated island enclaves of Brooklyn and Queens. Besides, New York’s shops and industries already had some direct rail service, via the Pennsylvania, the Long Island Rail Road, the New York Central, and the New Haven; that might be enough to handle New York’s needs, if the growth of industry and the construction of modern piers, in the 1920s and beyond, emphasized the low-cost, potentially more efficient New Jersey side. The theoretical advantages of this plan to New Jersey, and possibly to the nation, seem evident. Moreover, it might have been beneficial to New York as well; at least the ICC suggested this was so. In its report on the New York Harbor case in 1917, the ICC expressed concern regarding the nearly intolerable congestion and inefficiency surrounding delivery of freight to New York’s docks; if the region’s citizens did not soon find a solution to the problem, the ICC warned, the Commission itself might be compelled to take steps to reduce congestion in New York and the burden to the national economy which flowed from such congestion. What steps? The ICC might agree with New Jersey’s argument in the New York Harbor case and require the railroads to set lower transport rates for goods shipped to and from New Jersey terminals than for goods shipped to New York’s piers and shops. This differential would generate an economic incentive for industries to locate in the low-cost western zone, and for New Jersey’s cities and railroads to construct large, modern terminals at Newark Bay and along the Hudson coast. New York would benefit from less cluttered streets and piers, while “underdeveloped” communities in northern New Jersey would prosper.13 Those who have walked the dilapidated piers of Brooklyn and Manhattan in recent decades, and who followed the modernization and expansion of Newark and Elizabeth’s thriving marine terminals in the 1950s and beyond, might conclude that important elements of New Jersey’s arguments were correct. Moreover, since these New Jersey terminals are Port Authority enterprises, Brooklynites might credit Mayor Hylan with uncommon foresight in warning that the bi-state agency would transfer Brooklyn’s wealth to the “foreign” lands of New Jersey. Several factors have shaped the Port Authority’s investment strategy and the rise and fall of these several marine terminals; a crucial element has been the relative ease with which freight from Newark

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4-3. In northern New Jersey, the main candidates for developing marine terminals were Newark and Elizabeth on Newark Bay, together with Bayonne, Jersey City, Hoboken, Weehawken, and West New York, all communities in Hudson County which had already constructed some piers along the Hudson River.

and Elizabeth can reach the railroads and highways which fan out to the rest of the nation.14 In the early 1920s, however, the obstacles that confronted the New Jersey plan were immense. The railroads would not voluntarily shift their freight arrangements away from New York until they saw modern ship terminals rising in Newark Bay and along the Hudson shores; and it seemed unlikely that

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the ICC would force the rail lines to set reduced rates for delivering goods to marine terminals on the west side of the harbor, until there were large and modern piers on the Jersey shore to receive such goods. The crucial element that was needed, then, was a massive program of capital investment in docks, cargo-handing equipment, and associated rail spurs, carried out by the cities of northern New Jersey, perhaps with financial aid and planning assistance from state officials. This program would have to be premised on the hope that the railroads and steamships would make heavy use of the new piers, and that the ICC would ensure the railroads would do so, by compelling the rail lines to set lower rates to New Jersey points than to New York. The prospects for success would also depend on New Yorkers, who—it would be hoped—might sit quietly, watching New Jersey prepare to take away its commerce, rather than undertaking a vigorous competitive effort to modernize its own piers and lighterage system. Since New Jersey’s cities were not large (the two largest, Newark and Jersey City, had a combined population about one-seventh of New York City’s), state aid seemed likely to be a major factor in local terminal development. But could the state find enough money to help all the cities that appealed for help? Alternatively, did it have the political courage to focus only on one or two, and disregard cries of anguish from the rest? Taken together, these difficulties were too large to permit one to say that the “New Jersey plan” was a real possibility in the early 1920s, requiring only modest guidance from Trenton to assure success. In fact, more than two decades would pass, before the state could find some way to overcome these obstacles; then, as we will see in chapter 11, it would turn to the Port Authority, with its insulation from the competing demands of local interests and its independent funding, and ask that agency to take responsibility for modernizing its decaying ports.

A Vast Network of Rails and Terminals In 1921, however, the Port Authority rejected all three of these plans, and several others of more limited scope, and in late December announced its own decision. What the New York region needed, its officials proclaimed, was a Comprehensive Plan for the Development of the Port District—a program of action to extend rail freight service into every part of the large bi-state region, and ultimately to replace all the tug-and-lighterage operations with direct rail service from the Jersey shore across to Brooklyn, with an electric rail spur from New Jersey twisting and looping through Manhattan.15

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While the Comprehensive Plan would ultimately join the other plans for railroad development in history’s trash bin, we should allot some space to describing its main elements. For this was the scheme that would absorb much of the Port Authority’s intellectual and emotional energy throughout the 1920s; indeed, to some staff members deeply involved in thinking about freight problems and about the great inefficiencies of the railroad system, the Comprehensive Plan would continue as a live possibility—and the only way to obtain a modern, efficient transport system for the nation’s largest port— throughout the 1930s and into the 1940s.16 Moreover, the philosophy underlying the Comprehensive Plan shaped the Port Authority’s views in its first decade on all major issues of regional transportation. The need to solve the region’s freight transport problem had been the primary motivation for creating a Port Authority, and it was widely understood that this was primarily a railroad problem, requiring a railroad solution. In solving this problem, there was a place for motorized trucks, but it was a secondary role: they would mainly serve as feeder vehicles, carrying goods from railroad stations and terminals to nearby stores and residences.17 The Port Authority also acknowledged that passenger automobiles ought to be able to cross the Hudson River without waiting in long lines for ferries. However, that was a different task, as the Port Authority’s chairman pointed out, and it had been assigned elsewhere—to the tunnel commissions which, since 1919, had been laboring to construct a tube from Jersey City under the river to Canal Street. He also noted that public policy did not favor tolls on bridges and tunnels for motor vehicles—which seemed to preclude action by his agency. The tunnel commissions were supported by legislative appropriations, so they would not need to rely on tolls; but the Port Authority had no continuing access to tax revenues, and therefore its projects would have to be self-supporting, via tolls and rents.18 A review of the several parts of the Port Authority’s 1921 plan will underscore how fully the agency’s efforts to imagine future possibilities (“as far ahead as the process of reasoning could foresee”) were anchored in the technology of the past, how modest a role was given to motorized trucks despite their growing numbers on the roads, and how the Port agency attempted to modify “scientific knowledge” with some sense of political realism. The Port Authority’s Comprehensive Plan included five major elements: 1. A rail line—called Belt No. 1—would intersect all twelve of the railroads that came into the New York–New Jersey area; see figure 4-4. More than 60 miles long, it would be the keystone of the region’s entire freight system; goods would be collected from the twelve railroads and then sorted in “break-up

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yards,” so that all freight bound for the same destination would be grouped together (regardless of which railroad had brought it into the region). It would then be shipped in rail cars, along Belt No. 1 and connecting spurs, to freight terminals across the sprawling metropolis. Horse-drawn wagons and motor trucks would distribute the goods from these terminals to shops and stores. Belt No. 1 would start inland in New Jersey at Secaucus (five miles west of Manhattan’s Central Park), and sweep south to Jersey City and then down to Elizabeth, with a spur going east from Elizabeth across Staten Island. However, the primary element of Belt No. 1 would turn east in Jersey City, and then plunge under New York Bay and run a distance of four miles through the mud, emerging at Bay Ridge in Brooklyn. Then it would swing north through Queens, cross the Hell Gate Bridge into the Bronx, intersect the New Haven and all the New York Central lines, and terminate at the Hudson River. 2. A crucial inner rail line—called Belt No. 13—would begin at Fort Lee in Bergen County (roughly opposite 175th Street in Manhattan) and run south, close to the Jersey shore, through Hoboken and Jersey City to Bayonne. All parts of Belt No. 13 were already in existence, as were many parts of Belt No. 1; but various pieces of the two belt lines were controlled by different railroads, which would now need to agree on an efficient, unified arrangement. However, the tunnel under New York Bay would have to be constructed, and this would be a major capital expense.19 3. Thirteen other rail lines would be constructed or upgraded, ranging from a two-mile spur in Queens to a vast “outer beltline,” 71 miles in length, that would extend across northern New Jersey.20 4. Freight would be brought into Manhattan via a new rail loop, with two tunnels under the Hudson. This line would not carry regular railroad cars, since switching cars would take up too much space in this congested center. Instead, freight bound for Manhattan would be transferred—at railroad yards in northern New Jersey—to a set of electrified rail cars that would run under the Hudson and under the streets of downtown and midtown Manhattan, and then loop back into New Jersey to the railroad yards, and then back into Manhattan again, bringing freight efficiently to all commercial centers of the Island. 5. A series of twelve gigantic inland freight terminals would be constructed in Manhattan; the underground electric railroad trains would deposit freight at these stations, and motor trucks would then distribute goods to stores, residences and factories.21 An array of projects of this kind, the Port Authority argued, would meet the goal of “a well devised and comprehensive plan,” which would ensure that

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4-4. The Port of New York Authority’s rail-freight plan (1920s)

the region’s “natural advantages be properly developed and coordinated.” However, many parts of the plan involved extensive construction, and the Port Authority recognized the need for short-term changes that would provide some measure of “prompt relief.” These would include unified operation of Belt No. 13, which had existing connections to several lighter terminals on the Jersey shore; and unified lighterage from all piers, which would reduce congestion and the cost of floating freight across to Manhattan.22 The Comprehensive Plan announced in December 1921 was very similar to the plan sketched out by the Port Authority’s predecessor study commission,

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in its report of December 1920. Since the new agency’s personnel were mainly drawn from the study commission, and since the Authority was required to send a plan to the legislatures within a few months, that result should not be surprising. In fact, the earlier commission had already given close study to the Lindenthal bridge, the Narrows tunnel, and other possibilities, so the Port Authority’s position could reasonably be viewed as the result of three years of continuous study (1918–1921) of a wide range of options.23

The Impact of Local Sentiment and Railroad Vigilance Three years of continuous study, and the application of “scientific knowledge”—these were important ingredients in the plan the Port Authority announced in December 1921. However, its Comprehensive Plan also reflected other calculations, less clearly scientific, but more crucial, perhaps, to short-run political success. Most prominent among these was a willingness to include in the Plan practically every spur or other rail improvement that seemed likely to appeal to one local community or another. In a variant on the classic strategy of legislative logrolling, rail lines were drawn with modest abandon across the bi-state region, and to most of them was appended the comment, praiseworthy in early twentieth century America: “It will open up territory for commercial and industrial development.”24 For businesses and citizens in New York City’s outer boroughs, for example, who were fearful that the Port Authority’s plans would concentrate economic growth in Manhattan and northern New Jersey, such “development” rail lines were sketched out for The Bronx (an eight-mile set of spurs) and Queens (12 miles). Brooklyn would benefit from a 12-mile line connecting the major railroads—and the rest of the nation—to Jamaica Bay (where avid Brooklynites envisioned modern piers and commercial activity competing with Manhattan’s shipping terminals). Antagonism to the Port Authority on Staten Island, where sentiment was strong for the Narrows Tunnel alternative, would be quieted by 27 miles of new and improved rail lines, opening up most of the rural island for “commercial and industrial development.” Over in New Jersey, where critics of Manhattan’s dominance had sought lower railroad rates as a way to encourage development along the western bays and streams, the Port Authority held out the prospect that its own plans could provide the needed stimulus to economic growth. An improved Belt No. 13 might have an immediate effect on waterfront development in Hoboken and Jersey City; another line running along Raritan Bay and then to New Brunswick would “open up new territory” in that area; and Newark Bay, which some

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viewed as the proper center for future marine terminals and commercial vitality for the entire region, would be served by Belts No. 1 and 12, providing fast rail connections from piers in Elizabeth, Newark, and Bayonne to the rest of the metropolis, and to the rest of the nation. Taken all together, the vast construction projects offered by the bi-state agency promised more than 160 miles of new rail lines across the region—plus an extensive electric-train system and a dozen gigantic new freight stations for delivering goods throughout lower and midtown Manhattan. It was a program to warm the heart of every citizen who believed in economic growth and in stirring plans to achieve such growth— particularly since none of these great projects would be underwritten by the taxpayer. The railroads and commercial users—who would find the economic efficiency of their operations greatly enhanced—would foot the entire bill.25 One possible source of criticism, as the Port Authority prepared to ask the two state legislatures to endorse the Comprehensive Plan in early 1922, was the matter of priorities. Surely all these improvements could not be carried out at once; and if rail improvements near Newark’s waterfront or at Jamaica Bay should be slated for an early start, the rival across the region might cry out against an unfair advantage. To avoid the danger that its plans could become embroiled in such conflicts before receiving legislative blessing, the Port Authority decided that it would make “no recommendations as to the sequence of work to be undertaken. This must be developed step by step, by subsequent study and negotiation.”26 Although the bi-state agency may be criticized for creating a Comprehensive Plan that seemed to be an undisciplined “wish list,” without clear priorities or a timetable for action, the context in which it operated during this first year perhaps made this strategy inevitable. The two states had required that the agency submit a Comprehensive Plan by the end of 1921, and the bi-state Compact prevented the Port Authority from exercising any operating powers until both states had approved such a plan.27 The sad experience of the past three years—when its powers to shape development in the region had been stripped away because of local and legislative criticism— suggested the advantage of a program full of benefits and short on pain, lest one of the states fail to endorse the Plan and so stop the Port Authority from all useful activity. In addition, the two states had required the Port agency to consult widely in constructing its Plan—to meet with all the local governments in the region, and with business groups and civic associations. Its many meetings with these organizations increased the tendency of the Authority to think about additions to its possible projects, rather than about tightening and focusing the Plan.28

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The Port Authority’s strategy did have the crucial advantage of permitting it to undercut the political strength of the three major alternative schemes. The Comprehensive Plan seemed to meet the major aims of Lindenthal’s 57th Street Bridge, without the Manhattan traffic congestion threatened by that project. The proposed rail lines might well provide an important step toward stimulating economic growth across the counties of New Jersey. And in Brooklyn and Staten Island, where the Narrows Tunnel had great attractions, the cross-Bay tunnel and the array of belt lines in the Port Authority’s plan also seemed likely to set the stage for economic expansion in both of those large boroughs. In meeting its own short-term political needs, then, the Port Authority also muted, at least for a time, the suspicions and jealousies that had prevented Brooklyn, Manhattan, Staten Island and New Jersey from thinking together about regional developments that might promise joint benefits.29 The text of the announced plan also reflected a second political calculation. Port Authority officials recognized that they would need cooperation from the railroads in order to carry out the Comprehensive Plan. In the immediate future, railroad endorsement would help assure prompt legislative approval of the Plan; more important, opposition from rail executives might doom the Plan, especially in the New Jersey legislature, where the railroads had traditionally been an influential force. Within a few weeks after the signing of the 1921 Compact, the Port Authority’s counsel, Julius Henry Cohen, and other agency officials began a series of meetings with railroad executives. They soon found resistance, particularly to the Port agency’s underlying philosophy—that jointly operated and coordinated rail lines and terminals were desirable. Meetings with railroad representatives continued during the fall, and finally, in late December 1921, the Port Authority agreed to state in its report that the various projects would be carried out only “so far as practicable.” The railroad executives then endorsed the Comprehensive Plan.30 The advantage of this apparently slight concession was that the railroad interests would not attempt, in the coming months, to block legislative approval of the Port Authority’s activities. However, the cost exacted by this concession would be etched into Cohen’s brain, and those of his equally optimistic colleagues, in a slow and painful process which continued during the next ten years.

Victory at Trenton and Albany In the short run, the Port Authority’s strategy was successful. In New Jersey, the railroads interposed no objection, and public sentiment across Bergen and Hudson counties and in other western communities was favorable. Gov-

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ernor Edwards, who had vetoed the Port Compact a year earlier, surveyed local opinion and the wide-ranging projects now sketched out for northern New Jersey’s benefit and urged favorable action in the legislature. By midFebruary, both houses had voted to endorse the Comprehensive Plan, and Edwards signed the bill on February 23.31 Across the Hudson, the display of new rail lines and terminals, with their promise of economic development, generated enthusiastic support from the business community and mollified those whose first choice was a different plan.32 But New York City’s mayor was not pleased. To John Hylan and his associates, the Narrows Tunnel was far preferable to the Port Authority’s scheme, which threatened to stimulate growth in New Jersey at the cost of New York’s economic strength. And behind that flawed plan lay a more deeply flawed institution—an agency of government which would shape development policy within New York City, but whose leaders were not responsible to the voters of the city, or even perhaps to the voters of New York State. This was a denial of home rule, the mayor and his allies exclaimed, a denial of the principles of democracy.33 Gotham’s officials were fighting a losing battle, however. For three years, they had campaigned against any legislation creating a bi-state Port agency; by the third year, their virulent attacks had generated widespread antipathy to their cause, and the provision which would have given the city government the right to name two of New York State’s three Authority commissioners was stripped out of the bill. To many of Hylan’s opponents, the benefits of home rule were outweighed by his irresponsible attacks, and by a suspicion that city officials wanted control over port development as a route to Democratic patronage, not economic revitalization.34 Now, as he sought to gain support from the Republican-controlled legislature at Albany, Hylan also faced the persuasive oratory of his fellow Democrat and former ally, Alfred E. Smith. As governor of New York State in 1919–21, Smith had supported Julius Henry Cohen and the New York Chamber of Commerce in their efforts to create a bi-state Port agency. After losing the governorship in the Republican landslide of 1920, he was appointed by his successor, Republican Nathan Miller, as a commissioner of the new agency in April 1921. During the summer and fall, he had been actively involved in developing the detailed plans and in meeting with local groups to urge their support. Finally, in the legislative hearing at Albany in January 1922, Smith underscored his break with New York City’s Democrats, laying out the argument for the Port Authority’s bi-state program of rail lines and terminals in detail, and with a persuasive power that few could match.35

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On February 21, both houses of the New York legislature approved the Comprehensive Plan, and Governor Miller signed the bill on February 24. The vote highlighted the division between New York City’s demand that it control its own future, and the position of the business community in the metropolis, supported by the state Republican leadership, that a regional strategy would be more productive—especially if it could be insulated from Hylanism. The Democrats, following the lead of their large contingent from New York City, overwhelming opposed the Port Authority’s plan, with but one favorable vote in the Senate and four in the Assembly. But all the Republicans in both houses supported the Comprehensive Plan, except for the senator from Staten Island—where the business community was divided on the issue of which rail plan to champion to bring their isolated island into the region. So the Port Authority’s distinctive brand of Progressivism—a “spirit of science and technology, of rational system and organization”—had won out over “grass-roots impulses,” at least as those impulses were understood by New York City officials and some of her citizens. And perhaps this was also a victory for those who were anxious to preserve Manhattan’s dominance, against those on the eastern side of the region and in the western suburbs, who hoped to capture some part of her concentrated commercial energies. If Belt No. 1 and the 70-mile outer rail belt were finally constructed, their impact could tend to decentralize the region’s commerce. However, the centralizing force of the giant freight terminals and the underground freighttrain system in Manhattan might be much stronger. And the Port Authority’s short-term projects—to consolidate freight along Belt No. 13 and bring it across to Manhattan in well ordered groups of lighters—could be expected to increase the efficiency of the traditional Manhattan-dominant system. If the Comprehensive Plan was not a New York wolf dressed up in rational clothing, perhaps it was at least the work of a wily fox, who shared the sentiments of his former employer, the Chamber of Commerce of the State of New York. For Julius Henry Cohen, like the Chamber, saw the region’s economic strength, and its ability to fight off outside challenges—from Boston and Philadelphia, Baltimore and New Orleans—as crucially dependent on improving the system through which goods were conveyed into and out of its vital commercial center, which was the glory of Manhattan.36

5 Negotiating with the Railroads Regional Planning Confronts the Wary Capitalist

The transportation systems of this country . . . have been built up upon the theory of individualistic control, development and advantage. The executives and managers have reached their positions after years of service, in which they have become imbued with that theory. —Port of New York Authority, 1924 Annual Report1

It should be the effort of all civilized societies to substitute cooperative for competitive methods, whenever cooperation can prove its efficiency. . . . The essential condition of efficiency is always concentration of responsibility. —Herbert Croly, The Promise of American Life2

T

he Port Authority’s plans for coordinating rail and water transport, constructing new rail lines, and digging a four-mile tunnel under New York Bay were applauded across the bi-state region. To accomplish these great tasks, however, public approbation was only the first step, and it was not the most important step. The Port Authority’s goal was to improve freight movement, and in the United States this was a province of private enterprise. So the private railroad corporations would need to cooperate in carrying out the immense program. Otherwise, the Comprehensive Plan could not be carried forward, and the primary motivation for the Port Authority’s existence would seemingly be lost. The pages below describe the Port agency’s negotiations with the railroads, the Interstate Commerce Commission, the War Department and other interested parties. This effort began in May 1921, a few weeks after the Compact was signed, and continued on several fronts for the next seven years, with recurring expectations at the Port Authority’s offices that victory was “just around the corner.” A clear-eyed observer might have concluded quite early that victory was never likely around any corner; but there were 97

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reasons to be hopeful, and to admit defeat might exact a heavy toll on the Port Authority’s reputation, and on individual egos. And not the smallest of those egos was that of Julius Henry Cohen, who led the long campaign to convince the rail lines, the ICC, and the national government that a cooperative approach, under the guiding hand of the Port Authority, would result in improved efficiency and enhanced economic growth. In 1928, the ICC handed the bi-state agency a setback which traumatized and largely ended the main negotiation effort. Even so, its leaders continued to champion their ideas for improving rail freight service; and as the Depression weakened the rail corporations, the Authority hoped those recalcitrant advocates of self-interest would in time embrace the main elements of the Comprehensive Plan. Often the Port Authority’s motivation and behavior in the 1920s have been described in this highly critical way: Finding its rail plans blocked, and searching for some strategy to survive, the Port agency turned its back on its fundamental raison d’être and on the rail system, and found salvation in catering to motor vehicles.3 The reality was more complex: Cohen and his associates were involved for many years in a variety of efforts to collaborate with or to outmaneuver the railroads. The early legislation which sent the Authority into building bridges for motor vehicles came in 1924–25, when its rail-improvement activities were in their most energetic phase. In those years and beyond, the senior staff focused on the rail problem, and those efforts expanded from freight to embrace rail passengers as well. The highway-bridge engineers were set off in their own division, where they could carry out several distinct and bounded projects that, as Cohen had suggested some years earlier, constituted a narrow part of the region’s transportation problem.4 Even in the late 1920s, as two vehicular bridges to Staten Island were completed, the Port Authority’s deeper hopes remained with that fading relic, the Comprehensive Plan. The annual reports for 1928, 1929, and 1930 opened with discussions of belt-lines, railroad-freight terminals, and possible railroad cooperation in making the region’s transport system more efficient. Progress on the great bridge across the Hudson, which would soon mark the Port Authority as a leader in the use of expertise and scientific planning to solve the region’s problems, was relegated to later sections of these reports. As we will see, the initiatives that took the Port agency into the automotive age came more from outside demands than from the Authority’s own inclinations; and those pressures were politically persuasive while the Authority still had reason to expect that its major task—the Comprehensive Plan—would be carried forward.

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There is a final argument that can be directed against the criticism that the Port agency abandoned its proper focus, on railroad improvements, to embrace the siren song of the motor vehicle. As chapters 2 and 3 make clear, the 1921 Compact that established the Port Authority was not limited to rail problems. While the Comprehensive Plan approved in 1922 was focused on a range of specific proposals for rail and water freight movement (with a modest role for trucks as local feeders), the Compact emphasized wider themes— the need for “faithful co-operation” between the two states “in the future planning and development” of the Port District, and the central role of the Port Authority in providing “better coordination of the terminal, transportation and other facilities of commerce” in the region. This broad purpose could be used to justify Port Authority action that extended to motor vehicles and airplanes. Indeed, Cohen and his colleagues had designed the bi-state agency so it could take on a wide range of problems involving interstate cooperation, including water pollution.5 Notably, however, the wide scope suggested by the phrasing in the Compact was not uppermost in Cohen’s thinking, once the Comprehensive Plan had been endorsed by the legislatures, early in 1922. Cohen and his associates then cited the rail-oriented Plan (rather than the Compact) as the structure under which all its activities should be justified. We see this focus, in a remarkable way, in the legislation in 1924–25 authorizing the Port Authority to construct the George Washington Bridge and two Staten Island crossings (the Goethals and the Outerbridge). All three statutes empowered the Authority to build these spans “in partial effectuation of the comprehensive plan for the development of the port of New York, and of section four thereof.” Section four of the Plan referred only to projects that would carry meat, milk, and other goods from New Jersey to Manhattan, preferably by underground rail. It was an unusual way to justify a vehicular span, and a most unusual way to justify building bridges from New Jersey to Staten Island.6 In 1927, Cohen indicated that his focus was still on the Comprehensive Plan, not on the broad purposes that shaped his earlier crafting of the Port Compact: Those who have watched the progress of the Port Authority have seen what, on first examination, looked like a change in its program, and anxious friends have worried lest it be diverted from its original task. . . . It was originally created to coordinate the rail and water freight transportation facilities of the district. This work it is doing, not, in the case of rail

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terminals, with the same rapidity as in the building of bridges, but it is doing this work.7

So it was that Cohen and his colleagues carried the banner of railway freight improvements against the bastions of the railroads throughout the 1920s, pausing now and then to take on new duties—here a bridge, there a role in solving rail passenger problems—until they emerged in the 1930s, somewhat to their surprise, almost cleansed of their railroad passion, and applauded for their skill in carrying out tasks that once they had considered useful, but quite secondary.

What Is Efficiency? Two Conflicting Views Underlying the conflicts between the Port Authority and the railroads in the 1920s was an important difference in perspective. Drawing upon values of the Progressive Era, Cohen and his associates viewed government as having an important mission as social planner, whose wider vision could moderate the inefficiencies of untrammeled competition. In contrast, the rail executives embraced the view that vigorous competition was the best route to efficiency and social progress, although their competitive ardor was admittedly constrained by the regulatory edicts of the Interstate Commerce Commission.

The Value of Rational Planning To the Port Authority’s leaders, the purpose of any transportation system was to serve the user, with maximum efficiency. An efficient transport system was one which met high standards of speed and reliability, at minimum cost. In a concentrated commercial center like the New York area, particular emphasis might be given to the needs of manufacturers, retailers, and other heavy users. Believing in “competitive capitalism,” the agency’s top officials thought competition was an important route to high levels of achievement. If the ports at Baltimore and Philadelphia and New York competed vigorously, that would stimulate each metropolis to search for ways to improve speed and reliability in moving goods; the cumulative effort would be to lower the cost of goods to the producer and the consumer, and to encourage economic growth across the nation. But competition was not always a reasonable route to greater efficiency. Under some conditions, competitive impulses could generate inefficien-

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cies—wasteful duplication of freight terminals, for example, and circuitous routing of goods so that each individual rail line could extract the maximum payment from the shippers and consumers. At the nation’s largest freight centers—inland cities like Chicago, and the large coastal ports—a pattern of duplication and unnecessary costs was a common complaint.8 The New York region was a striking illustration of these concerns. Its piers and steamships handled by far the largest share of the nation’s freight, including 40 percent of all foreign trade in the years before World War I; and this massive commercial activity had attracted twelve railroads to the bi-state metropolis. By 1920, rail lines laced throughout the region, large portions of the shoreline had been bought up by individual railroads to use for their own lighterage piers, and the waters of the Hudson and New York Bay were crowded with tugs and barges carrying freight around the region. Each railroad jealously guarded its own facilities—piers, segments of rail lines, bridges across the East River and other waterways—which it viewed as crucial to reliable service. And if costs for the 12 lines were compared, each railroad could note that its charges were no higher than its competitors’; which was true, but all of them were higher than freight-service costs in any competing city and—according to objective studies—much higher than they needed to be. This meant that slowly the New York-New Jersey area was losing foreign and coastal trade to its competitors; and the high costs of transport might lead some manufacturers to relocate their activities out of the region.9 The Port Authority’s officials could see how individualism and competitive ardor had brought the New York metropolis to its current unhappy state.10 But now the rail system, and the freight transport system in general, must be reorganized, duplication ended, speed of movement increased, and the entire arrangement governed by high standards of coordination and general efficiency. The Port agency essentially embraced a public utility conception of the private freight transport system, as it operated within the bistate region; like the systems of water supply and sewers in any large city, competition in freight transport was inefficient, and a single system should be instituted, under the supervision of a public agency concerned with safeguarding the public interest.11 As they entered into discussions with rail executives in 1921 and 1922, the Port Authority’s senior officials hoped that they could persuade the railroads to accept the Port agency’s views on the proper remedies. But they recognized that at some point, if the railroads were intransigent, coercion might be required—either through the regulatory powers available to the ICC, or preferably through a grant of power made directly to the bi-state agency. And

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so, toward the end of their first report to the states, they sounded a clarion call to arm the region’s own Port Authority: With natural advantages unparalleled, not heretofore developed as science and invention would have dictated because of diverse interests; with continuity of policy essential if any great comprehensive plan is to be achieved for the future; . . . it must be apparent that only through a coordinating agency, clothed with adequate powers . . . can there be brought to fruition the great benefits that can be foreseen.12

The Benefits of Competitive Capitalism and “Self-Interest” The railroads had a somewhat different view. Each sought to maximize its own freight traffic and profits, as its stockholders would expect, year by year. History had shown that competition in rates led to cut-throat price-cutting, which destabilized markets and threatened profits even for the strongest roads. Under the regulatory umbrella of the ICC, the railroads had during the first two decades of the twentieth century determined to co-exist in a reasonably stable environment by avoiding sharp rate competition, and by assigning freight territories which each line (or set of partly competing lines) would serve. The railroads competed mainly through reliability of services, and through advertising their individual advantages—direct rail service to Manhattan, for example, or fast lighterage service from the Jersey shore to Brooklyn steamship piers.13 To force the individual railroads to open up their lines and piers to their competitors would erase much of the distinctive advantage of each railway; and to replace individual freight services across the water with joint lighterage operations would indeed convert that crucial part of the region’s freight system into a publicly regulated utility. A publicly owned railroad tunnel or bridge joining New Jersey and New York City might have much the same result. Future profits on each railroad could not be predicted if these changes were made; and if the Port Authority’s campaign to reduce freight costs by limiting the present circuitous routing of freight around the region were successful, lower profits seemed likely. Given this perspective, the rail executives found it easy to reject out of hand the suggestion that they should enter into a joint agreement to pay for and use Mayor Hylan’s proposed rail tunnel under the Narrows—or a massive railroad bridge at 57th Street. They had been rejecting such notions for decades.14

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The Port Authority’s plans could not be dismissed so easily. Unlike Hylan’s tunnel and the Lindenthal bridge, the Port Authority offered a credible threat. Because the bi-state Compact had been approved by both states and by the federal government, the new agency might in time use governmental authority, including subpoena and condemnation powers, to open the railroads’ books to public scrutiny and perhaps force the rail lines to operate their own facilities for each other’s benefit. Also, the origins of the Port Authority were closely tied to the ICC’s scrutiny of railroad rate patterns in 1916–17; and in the New York Harbor case, decided late in 1917, the ICC had suggested that it might intervene more actively to shape railroad rates and rail competition if the inefficient New York rail system was not soon improved. Moreover, in 1920 the federal government had approved a new Transportation Act, which seemed to give the ICC the power to force each railroad to permit competing rail lines to use each other’s tracks, terminals, and lighters, if that step would improve service to the general public.15 An alliance between the Port Authority and the ICC might, therefore, prove dangerous to the competitive philosophy under which the railroads had long operated. The challenge facing the railroads in the early 1920s was to assume a cooperative guise toward this bi-state enterprise, while affirming the principle of corporate independence. Meanwhile, they would need to work with state legislators to ensure that the Port Authority did not receive any new enforcement powers; and they would monitor developments in Washington, in the hope that the activist ICC seen in the New York Harbor opinion might evolve into a less vigorous agency, which accepted the right of business people to run their own affairs. How the Port Authority attempted to implement its “public utility” philosophy, and how the railroads whittled away at its initiatives and its hopes, are the main themes of the events analyzed below. It was a sort of “cat and mouse” game: The railroad cat would permit the Port Authority mouse to run a little this way, and then a little that way, but each time a large railroad paw would block the way to the promised land. In the end, though, it was a friend of the cat in a Washington top hat that brought the mouse’s hope to its final, sad end.16

Ten Years of Travail Once the Comprehensive Plan had been approved by both states, in late February, 1922, the Port Authority’s leaders turned their attention to the ini-

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tial steps needed to carry out the program. In New Jersey, the first target was to unify Belt Line 13, which included several pieces of existing rail line that ran from Fort Lee south through Jersey City to Bayonne. The railroads that owned these pieces would, the bi-state agency concluded, have to place them under unified control, so that freight could be moved along the congested shore without delays and duplication of routing. Also, one section of that rail line (called the Hoboken Shore Line Railroad) had been acquired by the U.S. Government during the World War, and that segment would need to be recaptured from Washington. On the New York side of the Hudson, the first goal was to unify the operation of the existing segments of Belt No. 1, which ran from Brooklyn north through Queens into the Bronx. And in between, where an underwater rail tube would in time join the two sides of the region, the first priority was to bring all the railroads together to agree upon a unified interim plan for handling the cross-Bay floating of freight, rather than relying on 12 separate and overlapping patterns of barge movement.

The First Two Years: A Large Mouse with Powerful Friends? Presumably the proposed changes could save millions of dollars a year in shipping costs, including a substantial benefit to the railroads in their lighterage expenses. Rather than applauding the advantages of the Authority’s plans, however, during 1922 the railroads unanimously rejected all its proposals as unnecessary, and as violating appropriate standards of managerial discretion and business efficiency.17 The assurances of cooperation, which the Port Authority’s leaders thought they had received in 1921 from the railroads, had now, less than a year later, “turned out to be a mirage.” Cohen and his colleagues then responded aggressively, employing a three-pronged strategy. First, they asserted that the Comprehensive Plan, having been approved by both states and by a resolution in Congress, was “now the law of the State of New York, of the State of New Jersey and of the Congress of the United States,” with the Port Authority being fully empowered to execute the law. Second, the Port Authority turned to the ICC, asking that it hold a hearing on steps that the railroads should be required to take in order to carry out the Comprehensive Plan. And third, Port Authority commissioners took to the hustings in order to convince the public of the railroads’ intransigence and the need for action.18 In April 1923, the ICC opened hearings on the issue of unifying rail service along Belt Line 13. The ICC commissioners invited the Port Authority’s

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5-1. The Port Authority’s rail-freight plan

board to sit with them at the hearings, and the Authority’s staff then presented the agency’s case, describing the “inefficiencies” in current railroad practice and the advantages of the proposed beltlines. The railroads were sharply antagonistic. One speaker argued that unification of rail terminals violated the American way, which entailed individual, privately owned railroads competing for traffic. “That is the basis of it all,” he concluded; “it is either government ownership or that.” The counsel for the New York Central argued that “as long as we are engaged in a private business . . . , there is only one factor which gives the public a return, and that is self-interest.”

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Joint operation of terminals and other port facilities was not consistent with that self-interest.19 The ICC adjourned its hearings and asked both sides to return in September to provide their views on the ICC’s powers, especially as they had been expanded by the 1920 Transportation Act. Cohen soon directed his attention to the ICC’s recent Hastings decision. In that case, business interests in Hastings, Minnesota, had asked the ICC to compel the Milwaukee Railroad to open its terminal rail tracks to a competitor, because of the advantages that would accrue to the city’s shippers. The Commission had concluded, in its 1922 decision, that the 1920 act “gives us a direct and explicit power” to require such joint use when that would serve the “broader interest” of the general public. Cohen prepared a brief which linked the Hastings case directly to the situation in the New York region.20 Apparent progress. These hints that the ICC and the Port Authority might develop an alliance did not elude the railroads’ strategists. When the ICC hearings resumed in September, the railroads declined to challenge the Port Authority’s evidence on circuitous routing and excessive costs; instead, they asserted they were bowing to an “overwhelming public opinion that traffic conditions in this Port must be radically improved as soon as possible.” Representatives of all twelve rail lines announced that they would provide unified service along Belt 13, appoint a neutral director for the line, and create a new system of rates that would eliminate the inflated charges identified in the Port Authority’s study. They also agreed to join with the Port agency in a study of the New Jersey section of Belt Line 1, an important part of the overall Plan.21 Meanwhile, with the Hoboken Shore Line—a key element of Belt 13— still under federal control, Cohen saw an opportunity for the Port Authority to reach beyond its advisory and planning role. He urged that the agency purchase the Hoboken line and then operate it directly, as part of the modernized rail-to-ship program. At their meeting in October 1923, the Commissioners endorsed the plan and offered one million dollars in 30-year bonds for title to that rail line.22 Cohen and his associates also took action on other elements of the Comprehensive Plan. They began a study of the complex lighterage system, in collaboration with the rail executives, in the hope of recommending ways to consolidate the thousands of freight trips across the bays and rivers that occurred each day. Another staff analysis focused on freight movements by horse-drawn wagon and motor truck in Manhattan, with the aim of identify-

5-2. Belt 13, with associated piers and railroad links

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ing the best sites for the inland freight terminals which had been proposed as part of the Comprehensive Plan. Port Authority officials also joined with the transit commissions from several parts of the region, in order to begin studies of ways to improve commuter rail service from northern New Jersey, Westchester, and Long Island into the central business district.23 Pressure to aid motor vehicles. Interstate tunnels and bridges for motor vehicles seemed to be partly in the Port Authority’s field of interest, and partly outside it. If a bridge, for example, were to carry rail freight cars as well as motor vehicles between New Jersey and New York, it clearly fell within the agency’s domain, as the debate over the Lindenthal Bridge illustrated. A bridge or tunnel for vehicular traffic alone, however, did not initially seem to be a part of its regional planning mandate. The bi-state agency had been asked to focus its attention on freight traffic, and freight across the Hudson moved almost entirely by rail and lighter; moreover, the states had agreed earlier to create a separate set of agencies to build vehicular crossings.24 By early 1923, however, vehicular traffic in the bi-state region was expanding, and automobiles and trucks typically waited in long lines for the ferries connecting New Jersey to Manhattan. The Holland Tunnel would not open until at least 1926, seven years after construction had begun, and there was growing pressure to build additional tunnels. During the spring of 1923, the legislatures in both states had approved bills to permit private corporations to begin tunnels at 125th Street and other locations, and the Holland Tunnel commissioners were developing their own plans to construct three or four tunnels under the Hudson.25 The Port Authority then modified its earlier position. Writing to the two governors in March, Outerbridge referred to the spate of bills “providing for various tunnels . . . some vehicular, some railroad,” and he argued that trucks using interstate tunnels would have an important impact on freight movement in the region. Therefore, he concluded, any new tunnels should be approved only if they would be constructed under the supervision of a “single coordinating agency,” presumably the Port Authority.26 In Albany, Outerbridge’s letter landed on the desk of the state’s newly reelected governor, Alfred E. Smith. New Jersey also had a new governor, George Silzer, a Democrat who favored an activist government and rational planning of public projects, and whose interest in a vehicular bridge across the Hudson had been whetted by an engineer-adviser, Othmar Ammann. Both governors vetoed the private-tunnel bills, with Smith adopting the Outerbridge-Cohen perspective and extending it. Not only should the

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Port Authority have supervisory authority over the location and operation of any new tunnels, Smith argued; it should build them as well. Smith and Silzer then issued a joint statement in August urging “the construction at the earliest possible moment of additional vehicular tunnels or bridges between New York and New Jersey to be determined upon, constructed and financed by the Port Authority.”27 If the joint announcement did not catch Cohen and his colleagues unaware, it did find them unable to respond promptly. Preparations for the September ICC hearing, discussions on whether to float bonds to buy the Hoboken railroad, and other matters closely tied to the Comprehensive Plan occupied Cohen and his associates during the next three months. Finally, in late November, the Port Authority agreed to hold a public hearing on the issue of building “additional vehicular tunnels.”28 The hearing was held on December 5. While others favored a Hudson River bridge far north of mid-Manhattan, for automobiles and trucks, the Port Authority focused on tunnels for trucks to the main business district. The Authority concluded that the growth of traffic would justify as many as four additional tunnels during the next 20 years. Moreover, trucks traveling in these tunnels could carry goods to the large inland freight terminals, to be constructed as part of the Comprehensive Plan. Later, as freight traffic into Manhattan expanded, the Plan’s underground electric rail system would be constructed and would probably replace this trans-Hudson trucking.29

The Mid-1920s: Optimism on Several Fronts The Port Authority’s plate was full at the start of 1924, with passenger rail transit and vehicular crossings added to its range of tasks. However, Cohen and his key associates kept their main attention directed to the railroad freight problem. In their 1924 report, they pointed out that the railway executives were now less inclined to treat all issues in terms of narrow rivalry and individual advantage, and were actively cooperating with the Authority.30 During the next two years, that collaborative approach continued in three important areas. First, freight exchanges along the several pieces of Belt Line 13 were integrated, and by the end of 1925, that belt was operated as a coordinated system, resulting in substantial savings to shippers. While the railroads had not yet agreed upon a neutral director of operations, the Authority was now able to announce that “the first part of the Comprehensive Plan” had been “put into effect.” Second, the joint study of ways to combine lighterage in the harbor continued, with the rail operators absorbing half the

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cost. The Port Authority anticipated that this study would be finished in 1926, and barge services could then be consolidated, with large savings to the rail lines and to shippers.31 Finally, with cooperation from the rail executives, the bi-state agency completed its study of consolidated freight terminals in August 1925. The Authority announced the need for at least nine large freight buildings in Manhattan; goods brought from all the region’s rail lines would be sorted by neighborhood and block, and the organized freight would then be delivered by truck. The agency estimated that the new system would save the railroads $2 million and shippers $12 million a year, while reducing the number of trucks on congested Manhattan streets.32 Expanding its legal powers and buying a rail line. Meanwhile, Cohen tried to use his legal skills to strengthen the Port Authority’s capacity to shape the region’s future. In 1924 he crafted a bill which would give the agency the power to subpoena witnesses and to gain access to records needed for its studies, ostensibly to ensure that the Authority could obtain information on costs and traffic patterns. However, the bill went much further. Tucked into the final sections of the “Investigation and Subpoena Act” were provisions that would authorize the Port Authority to determine what steps involved in carrying out the Comprehensive Plan were “economically practicable,” and then to issue “an appropriate order,” which could be enforced in a court of law. The result would be to shift such crucial matters as what freight movements should be consolidated, and which railroad terminals would be opened up to competitors, from an arena for negotiation between the Port Authority and the railroads to a matter on which the Authority’s decision— subject to due process constraints—would be decisive. Thus the new law would restore some of the powers which had been included in Cohen’s 1919 draft, and which the legislative committees had stripped away before the Compact became law in 1921. Cohen’s bill brought the railroad lobby to life in both states, but despite its vigorous efforts in Albany, the measure was passed by the New York State Senate and Assembly, and Al Smith signed it in May. It did not win approval in Trenton during the 1924 session, but Cohen planned to bring up again the next year.33 As soon as the New York bill was signed, Cohen found an opportunity to use it in pursuit of the Plan’s principles. In April 1924, the Queens Chamber of Commerce, pointing out that the railroads had agreed to cooperative use of rail track on the west side of the Hudson (Belt 13), asked that the same

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principles be applied to rail freight entering Long Island. The business leaders hoped to open up the Hell Gate Bridge, which had been built by the Pennsylvania Railroad, so that the New York Central could use the railroad bridge as well, and so give its Long Island customers faster service. The Hell Gate was also a crucial piece of the eastern side of Belt Line 1, and success in this effort would advance the principles of the Comprehensive Plan.34 Cohen and his colleagues contacted the railroads, in the hope that agreement could be obtained informally. Finding resistance, the Port Authority then issued its first order under the Investigation and Subpoena Act and held a set of hearings in the fall of 1924. Cohen urged his commissioners to follow the principle that all rail lines in the New York region should be available to all carriers, so the region’s public could have the most efficient service possible. The commissioners agreed, and in February 1925 they announced that the Hell Gate should be opened to the New York Central’s trains. The Pennsylvania objected to permitting its ardent competitor to use the Hell Gate crossing, and Cohen then appealed to the ICC and the New York State Public Service Commission.35 While crafting the legal strategy for Hell Gate, Cohen was also occupied with a crucial set of negotiations in Washington. In the fall of 1923, the Port Authority had offered the War Department $1 million in bonds for the Hoboken Shore Line, backed by its prospective earnings on Belt 13 and any other facilities it might acquire. The Department had appeared to indicate that it would transfer ownership of the railroad on this basis, but once the offer was made, it was rejected; the War Department preferred cash and said it would accept Port Authority bonds only if sanctioned by Congressional action. The Authority appealed to friendly members of Congress, and early in 1924 the necessary bills were introduced. During the next year and a half, Congressional committees debated and then endorsed the legislation, while the War Department tried to sell the property to private interests before Congress could take final action. Finally, in February 1925, Congress authorized the Department to accept Port Authority bonds and Cohen went to Washington to work out the final contract for sale. Negotiations were nearly completed by the end of 1925.36 Political pressures and new duties. During 1924–25, the Port Authority also found itself swept into the automotive age. After its December 1923 hearing on bridges and tunnels, the Authority had suggested that several additional tunnels might be built north of the Holland. What happened next, however, moved the Authority in unexpected directions—committing it to build not tunnels but bridges, and not to Manhattan but to Staten Island.

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In the decades before 1920, there had been recurring demands from Staten Island’s citizens for bridges across the Arthur Kill, a narrow waterway that separates the island from New Jersey’s mainland. Public sentiment in nearby Elizabeth (in Union County) and Perth Amboy (in Middlesex County) also supported the idea. In 1919, the states created the two bridge and tunnel commissions, which planned the Holland Tunnel. However, their mandate was not limited to that crossing, and Staten Island political leaders soon pressed for state funding which would allow the two commissions to plan bridges across the Arthur Kill. By early 1923, local groups on Staten Island lobbying for a bridge study were joined by their New Jersey colleagues from Union and Middlesex. Both states then appropriated funds, the joint commissions carried out a preliminary study, and in the fall of 1923 they reported that a bridge at Perth Amboy was “desirable and practicable.” Traffic conditions for those crossing by ferry had become “intolerable,” they concluded, as population increases on both sides of the Arthur Kill had led to long delays at ferry terminals, and the commissioners recommended “immediate remedial action.”37 Meanwhile, Governors Smith and Silzer had announced in August 1923 that they preferred to have the Port Authority take responsibility for any further interstate tunnels or bridges. In their annual messages five months later, both governors reaffirmed this position, and they coupled it with a vigorous attack on the Holland Tunnel agency, which they criticized for delays and cost overruns.38 At this point, State Senator Arthur Pierson of Union County brought together those active in the local campaigns to work out a joint strategy. They soon agreed to ask that the Port Authority build and operate two Staten Island crossings. The governors supported this move, and by April 1924 legislation authorizing action by the Port agency had been approved at Albany and Trenton. The Port Authority did not oppose this sudden addition to its duties, but it did not take an active role in urging passage of the legislation, for its staff was largely occupied with the complex rail freight issues described above.39 The Port Authority’s first step into the automotive age was followed by a more significant commitment, a year later, to study and build a gigantic span across the Hudson River. That complex story, which also found the Port Authority in a relatively passive role until the project was near to approval, is told in the next chapter. In 1924–25, Cohen also had to devote a portion of his energies to blocking another foray from an old foe, John Hylan. As mayor of New York City since 1918, Hylan had long opposed the Port Authority and its plan to construct a railroad freight tunnel under New York Bay, extending from Jersey

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5-3. The three bridges built by the Port Authority between Staten Island and New Jersey in the 1920s: the Outerbridge span at the southern end of Staten Island (to Perth Amboy, in Middlesex County); the Goethals (to Elizabeth in Union County); and the Bayonne (to the city of Bayonne in Hudson County). The Holland Tunnel, nine miles north of the Bayonne span, is also shown.

City to Brooklyn. Rail freight from the west should be brought instead, he argued, from New Jersey across Staten Island and then through a railroad tunnel under the Narrows to Brooklyn.40 By the spring of 1924, Hylan had gained the support of civic and business associations in Brooklyn and Staten Island, and he decided to use city rev-

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enues to build his tunnel. The Port Authority, the Citizens Union, and other Manhattan-oriented groups attacked that competitor to the Comprehensive Plan; and Governor Smith and his allies in the state legislature then introduced legislation that would limit any Narrows tunnel to a small-bore passenger transit line. During the controversy, which extended into the spring of 1925, Cohen was surprised to find that the Committee on the Regional Plan, which he had counted as friendly to the Port Authority’s plans, supported the Hylan plan. But the Port Authority soon won the battle at Albany; in late April, Al Smith signed the bill ending Hylan’s freight-tunnel hopes. The Port Authority was left with a clear field: its own tunneling efforts could begin as soon as the railroad executives were ready to cooperate.41 Finally, at the end of 1925, Cohen and his colleagues could anticipate a new spirit of cooperation with New York City officials. For eight years Mayor Hylan had preached relentless hostility to cooperation with New Jersey and to the plans of the Port Authority. In time, he wore out his welcome with Al Smith and with the voters. Smith, still the most influential political leader in New York City, withdrew his support as Hylan opened his bid for a third term as Mayor in 1925; and Hylan was defeated. The Port Authority now looked forward to working with Mayor James J. Walker, who took office in January 1926, and who promised that he would cooperate with the bi-state agency.42 As 1926 opened, the Port Authority could marvel at the continued growth of commerce in the New York metropolis, despite the great weaknesses in its transportation system. And it could see that those weaknesses would soon be overcome—the Hoboken Shore Line controlled by the Authority and integrated into Belt 13; joint lighterage established, cutting down the heavy costs of transferring freight across the Hudson and New York Bay; the first inland terminal constructed, beginning a new era in consolidated freight delivery in Manhattan; and the Hell Gate Bridge opened to all traffic, thus cutting freight costs for Long Island businesses and residents. As these and other steps in the Comprehensive Plan were carried out, the region’s extraordinary vitality would be advanced still further. Of course “some sacrifice of individual advantage may be required,” the Authority noted, but great benefits would also accrue, and these benefits “will be shared by the railroads as well as their patrons.”43

Decline and Fall of a Railroad Vision During the next several years, most of the Port Authority’s rail-freight hopes and regional designs crashed to earth, victims of the reluctance of the private rail corporations to change their habitual ways, reinforced by doubts in the

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era of Warren Harding and Calvin Coolidge that governmental power should be permitted to tamper with the benefits of laissez faire. The first to tumble to the ground was the agency’s hope of purchasing the Hoboken line, a crucial link in the Authority’s plan to fashion modernized rail-to-ship facilities along the New Jersey shore. After several years of negotiations and delays, the War Department raised its demands early in 1926, essentially ending the Port agency’s ability to buy the line. The Port Authority regretfully broke off discussions, and in 1927 the War Department sold this important piece of the rail system to the Lackawanna Railroad.44 Next came the goal of unified operation of the entire Belt Line 13 under a “neutral” director, who would ensure that freight movement along the Hudson shore would be guided by general principles of efficiency—not by short-term profit goals of each railroad. After agreeing in the fall of 1923 to “provide a unified service over the line,” the railroads assigned members of their staffs to work on the problem, offered hints of real progress soon to come, and led the Port Authority to believe, for a time, that a truly integrated system, serving all the region’s railroads, would shortly be created. By early 1927 a neutral director of operations had still not been appointed, and the Port Authority then insisted that the railroads live up to their 1923 agreement. And so they did in March 1927, appointing an operating official of a railroad affiliated with the New York Central to the post—while he retained all his duties with the Central. His possible bias was not of concern to the railroads, however, for he was given no control over the routing of freight. That remained as it had always been, under the control of four competing railroads.45 A sharper blow landed a few weeks later, when the railroads abandoned their cooperative efforts on the lighterage problem. In 1923, all the rail corporations had assigned staff members to work with the Port Authority and the steamship companies, in order to analyze the thousands of trips each month of tugs, barges, and lighters. By the end of 1926, a major part of the study had been completed, and the Port Authority concluded that the present system— with each railroad sending its own tugs and barges across the waters with small loads of freight—was far too inefficient. In the short term, until the railroad tunnels between New Jersey and New York could be constructed, the railroads should pool their equipment and run an integrated service, saving themselves and the shipping public many millions of dollars.46 The railroad executives scrutinized this sharp attack on their traditional efforts, and in April 1927 flatly rejected the Port Authority’s plans—and its underlying perspective, that joint operation should replace the efforts of each

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rail line to outdo the others in speed of delivery and quality of service. To “eliminate the competition which now exists” in freight deliveries across the harbor, the executives argued, would undermine the pressures for efficient delivery which were an important part of the industry’s vitality.47 By now it seemed clear that the rail lines would carry out their own plans, without entangling alliances or the guiding hand of an “expert” planner. This position was underscored by the railroads’ new projects in 1927: While the Port agency was extolling the benefits of union freight terminals, the Pennsylvania opened two new freight stations to serve its own needs in Manhattan, and the Lehigh Valley opened a third, restricted to its own freight bound for New York factories and stores. However, the Port Authority thought it had a powerful card, if it could but play it in time. If the rail executives did not appreciate the value of planning and acting cooperatively in a complex urban region, they might still be forced to act more broadly, through the intervention of the ICC. An alliance with the ICC seemed plausible to Cohen in the early and mid-1920s, when that regulatory body was led by men like Joseph B. Eastman—commissioners appointed by Progressive-Era presidents and willing to employ the powers of government to carry out great tasks. The potential for activism seemed to be reinforced by the federal Transportation Act of 1920, which encouraged the Commission to take a leading role in improving efficiency, and by the ICC’s first decision in the Hastings case, discussed earlier; in that 1922 opinion, the ICC concluded that the 1920 Act gave it “direct and explicit power” to compel joint use of terminal facilities. But the Port Authority did not grasp and use that alliance in its early years; instead, seeking cooperation with the railroads, Cohen and his colleagues had endeavored to persuade them of the mutual benefits of joint terminals and other changes. And the rail executives, realizing that the Port Authority might proceed in that softer way—as long as success seemed in time likely— had assigned some of their staff members to the Port agency’s projects and made encouraging comments as the studies proceeded. By 1925–26, however, it was evident that the troubling ICC zeal suggested by the 1917 New York Harbor and 1922 Hastings decisions was not likely to shape future ICC actions. A hint of what this might mean for the Port Authority’s plans was provided in 1926, when the Commission reversed its 1922 decision in the Hastings case.48 Then, early in 1927, an ICC examiner rejected the Port Authority’s argument that the Commission should force the Pennsylvania Railroad to open its Hell Gate Bridge to competing railroads. Cohen appealed to the full Commission in outraged terms:

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If the Hell Gate Bridge is . . . to be regarded as a private facility to be given only such restricted use as the selfish requirements of the Pennsylvania and the New Haven may dictate, then these complaints should be dismissed. If, on the contrary, shippers . . . are entitled to adequate transportation service . . . and if consideration is to be given to the declared policies of the two States and of Congress, then the relief sought . . . must be granted.49

But the appeal fell on deafened ears, and in the summer of 1928 the ICC rejected the Port Authority’s position. Expressing concern that opening the Hell Gate route to all comers would undermine the property rights of its owner, the ICC voted unanimously to leave the bridge under the control of the Pennsylvania. What the ICC had offered in 1917 in the New York Harbor case—a readiness to use its influence to end the “unrestrained competition” among the rail lines and to unify terminal operations in the Port of New York—was a prospect no longer.50 To the railroads, in the 1920s as in earlier decades, competition to retain and gain freight traffic on their own lines, under the mild monitoring hand of the ICC, seemed to offer the best route to profits and to abiding success. It was “the American way.” To be sure, competition entailed some duplication of tracks, terminals, and barge trips, and perhaps therefore some increase in freight costs—compared with an ideal design for “efficient” freight movement. But there was little sympathy in railroad quarters with the view that a Great Coordinator would actually be able to create and operate a better system than the railroads and their allies had hammered out through long experience.51 In addition, the inefficiencies which encumbered the rail freight system were of little consequence to the railroads themselves. There might be higher charges to the shippers and to customers, who had to absorb in freight bills the costs of operating these many, overlapping facilities. But what options did the shippers and their customers have? The railroads had won out against the canal systems some 80 years before. For short hauls, horse-drawn wagons and motor trucks could supplement the rail lines, but the overwhelming bulk of freight moving into and through the New York area must move mainly by rail cars. If costs were a little higher than they would be in an “ideal system,” and if delays were occasionally encountered in getting freight to factories, stores, and homes, there was really no alternative for shippers and customers. They would wait for deliveries, and they would pay a little more, because they had to. And the railroads could prosper, as long

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as the ICC did not attempt to force the rail corporations to change their competitive ways.52 By 1928, the railroad executives could see that they were now free from the possible incursions of a hyperactive ICC. They then agreed to cooperate with the Port Authority in its plans to construct a large freight building in Manhattan. And this led the Port agency to wax enthusiastic: “We have,” the agency announced, “entered upon a new era in our relations with the railroads,” an era of “mutual confidence and good will.” In reality, however, the optimism of Cohen and his colleagues was nearly all that remained of the wide-ranging Comprehensive Plan. In return for railroad support for the freight terminal, the Port agency agreed to set aside all its other plans and projects for the foreseeable future, and to take no further steps that would challenge existing railroad policies, either in court or in the bar of public opinion. Its days of stirring plans and public jousting with the rail executives were at an end; and its stable of engineers with railroad expertise was soon dispersed.53 Moreover, once the Inland Freight Terminal—a huge building at 15th Street and Eighth Avenue—was completed and opened, in 1932, it soon became clear that the railroads’ competitive strategies were essentially unchanged. Their information and pricing policies gave little incentive for shippers to route freight through the new facility, which therefore made only a modest contribution to reducing congestion or improving efficiency of freight transfer in Manhattan. What had once been heralded as the first of nine great freight terminals in Manhattan was reduced to a projected three, and then to only this one, which limped along in the 1930s, victim of the railroads’ attitudes and of the Great Depression.54 After ten years of energetic effort, little had been accomplished toward meeting the long-term goals of the Port Authority and her allies in the two states. In 1931–32, the complex system of carrying raw materials, manufactured goods, and foodstuffs into and out of the New York region was just as time-consuming and inefficient as it had been a decade before. The proportion of the nation’s foreign trade passing through the Port of New York was slipping, relative to New Orleans, Baltimore, and other competitors, as it had been in the years prior to the Great War. Meanwhile, dissenters in the sometime breakaway province of New Jersey had recognized that the promise of the Comprehensive Plan for their side of the region was not likely to be achieved. So it was not surprising that in 1929 the arguments of the New York Harbor case were revived, as the State of New Jersey brought suit against the railroads, demanding that they reduce their charges to deliver goods to the

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New Jersey side of the harbor, compared with tariffs for Manhattan and points to the east. The destructive conflicts between the two states, which Julius Henry Cohen and his colleagues had thought they had laid to rest in 1921, were once again in center stage.55 What the dissenters in the Garden State had missed, however, and the railroads too, was the declining relevance of all these battles. The proportion of freight traffic handled by motorized trucks, a trickle in the early 1920s, was growing steadily, and within a few years trucking had become a significant alternative for shippers who wished to send goods cheaply and quickly into and out of the New York region. The rail executives had resisted the pleas and pressures that they improve efficiency and reduce costs; and while they dragged their feet and turned their backs, the trucks took their traffic away. And so the railroads provided a serviceable example of Freeman Dyson’s historical observation: A technology during its phase of rapid growth and spectacular success is usually small, quick and agile. As it grows mature it becomes settled and conservative, prevented by the inertia of size from reacting quickly to sudden shocks. When a technology has grown so big and sluggish that it can no longer bend with the winds of change, it is ripe for extinction.56

By the early 1930s the Port agency’s main interests were no longer with that aged technology. Her leaders had at last embraced the benefits of the motorized truck and the automobile, whose efficiency of travel was now greatly aided by an array of new bridges and tunnels operated by the Port Authority; and this bi-state enterprise had become, as Archibald Macleish observed in 1933, “one of the most interesting and potentially one of the most formidable political agencies America has yet produced.”57 The steps by which the Port agency achieved that distinctive position have been touched on in this chapter, but the turns and twists of its early automotive ventures deserve a larger place in this analysis of the Port Authority’s complex history.

6 Politics and Engineering Passion Expanding the Port Authority’s Dreams

The giant project for which I have been sacrificing time and money for the past three years, today lies in ruins. In vain, I as well as others have been fighting against the unlimited ambition of a genius who is obsessed with illusions of grandeur. . . . However, I have gained a rich experience and have decided to build anew on the ruins with fresh hope and courage—and, at that, on my own initiative and with my own plans. . . . —O. H. Ammann, letter to R. L. Ammann, Dec. 14, 1923

W

here rational planning yoked to an old technology could not succeed for the Port of New York Authority, the march of technological change—salted with individual ambition and great entrepreneurial skills— might give new life to that struggling babe. And so they did, in a pattern of causal linkages that was as complex as the slow winding down of the railroad waltz examined in the last chapter. In a pattern whose main lines of influence were not clearly visible, so that they were soon lost from historical sight. Then, as I noted in chapter 5, the story of the 1920s would be reduced to a simpler tale, whose main elements are captured and endorsed in Carl Condit’s authoritative work on the Port of New York. The Port Authority commissioners, he writes, “quickly lost interest in the railroads and turned to the construction of trans-harbor arteries for automotive vehicles, which offered an immediate, abundant, and ever increasing revenue from tunnel and bridge tolls.”1 That story omits much that was important in the Port Authority’s history. In the last chapter, we saw how reluctant the Port Authority was to abandon its Comprehensive Plan and the range of economic-development benefits it saw as linked to improvements in rail transport in the New York region. We also caught glimpses of the Port agency’s interest in other areas—commuter rail projects, automotive spans to Staten Island, and a bridge over the Hudson at 179th Street. In this chapter we explore in more depth the process 120

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through which the Port Authority came to embrace the automotive age during the 1920s. Here a major role must be given to an outsider—Othmar Ammann—whose vision of the New York region and its transportation needs was crucially linked to individual aspirations, distinctive engineering talents, and political skills of unexpected dimension. Without Ammann, the Port Authority might in time have built and operated a series of bridges and tunnels across the Hudson River. However, it might instead have drifted into a secondary role. Its Staten Island bridges would turn out to be money-losers, providing no financial base for wider entrepreneurial reach, while the bi-state commissions, which were constructing the Holland Tunnel and would achieve great financial success once it opened in 1927, might have seemed the more successful enterprise. They might then have taken charge when the next tunnel, to midtown Manhattan, was considered a few years later. So the Port Authority would have been left to expand its developing career as a research and advisory body on regional transport needs, and as defender of the region’s interests at ICC rate hearings. Had those events occurred, it is not clear whether any government agency with the independence, financial strength, and political savvy to take control of the region’s airports and major seaport terminals would ever have emerged. Instead, the New York region might have gone the way of the San Francisco Bay Area, where separate authorities operate competing airports and marine terminals, and where internecine warfare and inefficiency in port and air terminal programs have been in ready supply.2 Using Ammann’s political, engineering, and administrative talents, the Port Authority was able to outperform the Holland Tunnel commissioners, and to make a plausible case that its distinctive political design, as an independent authority in control of its own revenue, was crucial to its success. By 1931 the bi-state agency had taken charge of the Holland crossing and its growing toll revenues, and it was then asked to plan the Lincoln Tunnel. Now the Port agency was regarded as a premier example of the advantages promised by the Progressive doctrine of independence, expertise, and entrepreneurial energy.3 With its reputation thus made, the Port Authority could expect that its regional vision and its planning skills would become steadily more influential in shaping transport improvements and economic development plans across the bi-state metropolis. Moreover, the Port agency would control all future profits from the Holland, the George Washington Bridge, and the Lincoln; and in time its officials would realize that those funds might be invested in airports and other new enterprises—so that the Port Authority

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could serve as a wide-ranging and flexible engine of economic growth throughout the New York region. Although Ammann was a pivotal contributor to this array of happenings, he did not, of course, act alone. An alliance with New Jersey governor George Silzer was crucial in persuading the Port Authority to take on vehicular projects. The attitude of Governor Alfred E. Smith was also important, especially on the question of whether private corporations would be able to build competing tunnels under the Hudson. At the Port Authority, Julius Henry Cohen and the chief engineer, W. W. Drinker, contributed modestly in the early stages; and toward the end of the decade Cohen again displayed his considerable tactical skills to bring the lucrative Holland Tunnel under the Port Authority’s wing. Civic boosters and developers in northern New Jersey also pressed for action at critical points, and their efforts helped to tip the balance toward the Port agency. And Gustav Lindenthal, once Ammann’s mentor and later his antagonist, played a part as well. But the central figure in the revolution at the Port Authority was Ammann; and we need to begin with him, many years before there was a Port Authority.4

Origins of an Entrepreneur Othmar Ammann was born in 1879 in Switzerland. In 1902 he graduated from the Polytechnic Institute in Zurich, where he studied with Wilhelm Ritter, a distinguished engineering teacher. Ammann worked as a structural draftsman in Europe for two years and then, at the urging of one of his former professors, left for America.5 Arriving in New York in the spring of 1904, Ammann found employment with a local engineering company. During the next several years he worked as an engineer in Manhattan, Chicago, and Pennsylvania, and he worked on several major bridges, including the Queensboro in New York City. The possibility of a bridge across the Hudson also attracted his early attention.6 In 1912 Ammann joined the firm of Gustav Lindenthal, the well known railroad-bridge engineer, and Lindenthal soon appointed him as his chief aide in work on the Hell Gate Bridge. Much of Ammann’s time during the years 1912–1917 was devoted to the Hell Gate, where he was in charge of all office and field operations, supervising a large team of engineers.7 After the Hell Gate Bridge was completed in early 1917, Lindenthal had very little engineering work to occupy his staff. He suggested that Ammann

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take a temporary position managing a pottery mine in which Lindenthal had invested, the Such Clay Pottery Company in Middlesex County, New Jersey. With his managerial skills, Ammann was able to turn a shaky financial enterprise into a healthy firm, earning a modest profit for Lindenthal and other investors. Then, in 1920, Lindenthal called him back to assist in developing plans for his proposed Hudson River span, which would carry railroad trains across the River and land them in Manhattan at 57th Street.

Lindenthal’s Great Bridge This railroad plan had its origins in the 1880s, when Lindenthal, recently arrived in New York, proposed that a massive bridge be constructed over the Hudson from Hoboken to 23rd Street.8 The span would carry ten railroad tracks, enough to allow all the New Jersey lines to cross the Hudson at that point; once in Manhattan, their passengers and cargo could be distributed throughout the central business area and beyond, into Brooklyn and points to the east and north. The Pennsylvania Railroad was strongly interested; that rail line carried thousands of rail passengers bound for Manhattan each day, and at New Jersey’s Hudson shore, they had to transfer to ferries to complete the trip to New York. In 1890 Lindenthal’s company obtained the approval of the federal government to construct a span over the Hudson. The Pennsylvania then tried to work out arrangements with the other railroads, with a view to sharing the costs of the new crossing. Finding them unwilling to cooperate, the Pennsylvania then embarked on a less expensive project that would fit its own passenger needs, and in 1910 it completed a tunnel which brought its New Jersey trains under the Hudson to a new passenger terminal at 33rd Street. Lindenthal never lost his interest in spanning the Hudson, however, and with the Hell Gate completed and World War I at an end, he began to develop new plans for the great crossing. Now, in 1920, he moved it uptown, to cross the Hudson at 57th Street. He then brought in Ammann as his principal assistant, and, noting the increasing importance of automobiles and trucks, he redesigned the bridge to carry rubber-tired vehicles as well as rail traffic. By the early spring of 1921, Lindenthal was able to display his new scheme: A Hudson River bridge at 57th Street which would be 6,600 feet in total length, with a central span across the Hudson of 3,240 feet—more than twice the length of any bridge span yet constructed. One bridge deck would carry ten railroad tracks, and a second deck, above it, would have four rapidtransit tracks and 16 lanes for automotive traffic. The bridge would cost 100

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million dollars, and the entire project might total $210 million. As the Scientific American noted with admiration, this “vast bridge . . . could easily take care of the whole of the traffic which surges to and fro between Manhattan and the mainland.”9 Not only would the new bridge take care of all the traffic, it would do so at a profit, Lindenthal argued, on the basis of an estimated traffic and a toll structure that would generate revenues of $45 million or more each year. Consequently, the entire project could be accomplished without burdening the taxpayer; his North River Bridge Company, a private corporation which had held a federal charter for a Hudson bridge since the 1880s, would raise the needed moneys from the capital market. It was this environment—of a marvelous engineering project, to be carried out under one of the world’s premier bridge designers, in an atmosphere of optimism—that enveloped Ammann in his early months of work. As he wrote to his mother in Switzerland early in 1921, just after the Scientific American article appeared, “The new project brings me great satisfaction, it is a great noble structure, and . . . the concept and modeling of the project demand intense attention and work . . . . The towers will be as high as the tallest skyscraper in New York.”10 The Lindenthal plan soon faced important hurdles, however. One of the earliest was the attitude of the Port Authority. As Lindenthal, Ammann, and their staff were completing the general plans for the 57th Street bridge, the bi-state Study Commission issued its final report, in January 1921, recommending the creation of the Port Authority. In the same report, the Commission outlined a preliminary physical plan to solve the region’s freight transport problem—an approach that emphasized the need for rail tunnels from New Jersey under the Hudson to Manhattan and under New York Bay to Brooklyn. In its essentials, the Commission’s scheme would soon be adopted as the Port Authority’s Comprehensive Plan. Lindenthal quickly recognized that his 57th Street Bridge and the railtunnel plan were in direct competition, for both were concerned with the crucial problem of transporting freight more efficiently between New York City and the rest of the continent. Soon after the Study Commission released its final report, Lindenthal attacked its proposals, arguing that it was unwise to rely on tunnels to handle freight, since tunnel size would limit the ability of rail cars to transport coal and bulky machinery to the New York side of the region. He also pointed out that the Commission’s plan was aimed only at the freight side of the issue—disregarding the pressing need for better passenger service.11

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Once the Port Authority had been created, in April, it reviewed the Lindenthal arguments but, as noted in chapter 4, the bi-state agency was not persuaded. With the potential advantages of the Lindenthal plan came great disadvantages. A bridge with many lanes that exited at 57th Street would add thousands of cars a day to Manhattan traffic congestion; also, a number of buildings would have to be torn down to make way for the passenger railroad terminal, which Lindenthal’s plan required, and for the freight line from 57th Street south to the Battery. Because of these problems, business leaders in New York City strongly opposed the scheme. In December 1921, the Port Authority rejected Lindenthal’s bridge and embraced the Comprehensive Plan, with its reliance on rail tunnels and belt lines. Lindenthal fought on in 1922, urging that business leaders adopt his approach, and asking the rail corporations to agree to use his new bridge— commitments that were crucial if it were to have any prospect of financial success. He also met with potential investors in an attempt to raise the funds needed to get the bridge started. Meanwhile, Ammann and his small staff continued to work on design issues associated with the project.

Ammann’s Divergent Views, and Conflict By the fall of 1922, Lindenthal had made little progress, his financial situation was very rocky, and his company could afford to pay Ammann only part of his monthly wages. Now the close alliance between Lindenthal and his chief aide began to sunder; and it soon became clear that their underlying values and their world-views were quite different. The two men shared the enthusiasm for the great project that Lindenthal had created in his mind and on paper. For both were civil engineers on a grand scale—bridge-builders who came from Europe to the United States because the young nation had the vast expanse, the wide rivers and deep ravines, that could provide challenges to skilled engineers for years to come. Moreover, America had the commercial vitality and urge for mobility that would require large bridges to be cast across the East River, the Hudson, the Mississippi and other waterways; and she had the wealth to ensure that vast resources—great amounts of manpower and materiel—could be gathered and orchestrated and used according to the designs of imaginative engineers. More generally, the nation which in the nineteenth century had built the Erie Canal and the transcontinental railway seemed imbued with a philosophy about planning and building that fit the hopes and aspirations of these two engineers and thousands of their compatriots. The planner Daniel Burn-

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ham expressed the basic American value that attracted Lindenthal and Ammann from their home countries: Make no little plans; they have no magic to stir men’s blood. . . . Make big plans; aim high in hope and work, remembering that a noble logical diagram once recorded will never die. . . . Remember that our sons and grandsons are going to do things that would stagger us. Let your watchword be order and your beacon beauty.12

To Lindenthal, there was no alternative to the massive and expensive project he had proposed. Neither tunnels under the Hudson, nor bridges farther up-river, nor a bridge limited to motor vehicles (and therefore much cheaper than a bridge with huge girders to carry railroad trains) could possibly meet the need for improved transportation between Manhattan and the western regions. Moreover, Lindenthal had been New York City’s bridge commissioner in the first years of the twentieth century, and there he had had a taste of engineering work in a government agency; he was strongly averse to relying on that political and conflict-filled route. The rational working environment, the corporate sponsorship, the freedom to design, and the international acclaim accompanying his Hell Gate project—these had demonstrated the right way to do it. In Lindenthal’s mind, insulation and professional integrity were crucial; and the engineer could be relied upon to work out the best way to meet the collateral goals all great engineering projects must achieve—principles of economy in construction, the aesthetic quality of the project itself, and an understanding of how the project would fit into the broader patterns of economic and social relationships within the metropolis.13 Ammann’s perspective was different. Lindenthal’s great bridge, in its original dimensions, would be wonderful. To Ammann, however, the substantive arguments and the political strength of those opposed to a project deserved the same steely-eyed analysis that a good engineer devoted to understanding the stresses on bridge cables and the stability of the ground under proposed bridge towers. If influential opponents thought the bridge too large, or badly located, Ammann could draw on his engineering experience and perhaps find ways to modify the plan, rather than let it go down to defeat. And as to the financing problem, private funding would be welcomed, since that would reduce the chances of the project becoming mired in the uncertainties of politics. But if private investors could not be

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attracted, then a great bridge sponsored and financed by government was better than no bridge at all. Nor did it make sense, in Ammann’s view, to wait patiently until the public demand for a bridge across the Hudson was overwhelming, for that time might never come. Instead of a magnificent bridge over the Hudson, the next decade might see a series of vehicular tunnels burrowed into the River mud. That danger was real, Ammann could see, for by 1922 the Holland Tunnel commissioners were beginning to suggest that they might construct additional tunnels—possibly one at 40th Street in Manhattan, another at 125th Street, and several in between. On the issues of location, type of bridge, sponsorship, and financing, Ammann was a pragmatist. His main goal was to bridge the Hudson. Of course he had the psychological advantage, in thinking about alternative ways to achieve this goal, that the original design was not his plan; Lindenthal had been working on a railroad bridge which would cross the Hudson to the Manhattan business district since 1888—for more than 30 years. And Ammann was a mere 42, nearly 30 years younger than his boss; possibly youth also encouraged greater flexibility. Perhaps most important, however, Ammann—in contrast to Lindenthal— could encompass political obstacles, and strategies to overcome them, within the analytic framework of his engineering mind. Any good engineer knew, for example, that you had to design your bridge in relation to the character of the terrain where the towers would sit. Therefore, if preliminary studies suggested the tower footing would be solid rock, while closer exploration revealed softer ground, adjustments and even major redesigns would then be necessary; and sometimes long weeks and months of arduous work would be needed to solve the problem and ensure that the towers and the bridge would hold. Moreover, bridge engineering was not an armchair activity; you had to go into the field continuously, marshal and motivate your workers, and modify your preliminary designs as the land and the weather and the impact of human mischance required. So too, close exploration of the political terrain associated with any large project was essential; and this might require meeting with local politicians and business people and interested citizens, in towns and county courthouses across the region, in order to work through the proper combination of engineering, aesthetic, and political designs. When Ammann pondered the problems that confronted Lindenthal and the 57th Street bridge in the fall of 1922, he concluded that the size and cost

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of the proposed bridge should be sharply reduced. If the bridge were limited to motor vehicles and light rail transit, the heavy, expensive structure needed for freight trains could be replaced by a lighter span, at much lower cost— and private investors might well be attracted to invest in a moderate-cost toll bridge for vehicles. Also, if influential citizens opposed a bridge at 57th Street, why not build it farther north, away from the congested midtown area? Once that crossing proved successful, a bridge at 57th Street might also receive wide support. During the fall and winter of 1922, Ammann urged Lindenthal to reduce the size of the 57th Street project, and to consider shifting his short-term goal to a bridge limited to autos, trucks, and light rail transit, which would cross the Hudson several miles north of the midtown area. But Lindenthal thought a crossing that far from the main business district would not attract sufficient vehicular traffic; moreover, rail freight also needed better access to New York, and only a combined railroad/motor vehicle bridge could bring freight and passengers to mid-Manhattan with marvelous efficiency. To Lindenthal, the 57th Street project was the only satisfactory way to solve the intertwined problems of freight and passengers—at one stroke joining New York City’s vast economic strength with the economies of New Jersey and the rest of the continent. As 1922 drew to a close, it seemed evident to Ammann that he would have to take some initiative on his own. His diaries and other writings during these months do not provide clear evidence that he was deeply distressed, and his letters to his relatives are guarded. But a year later, Ammann expressed his feelings on Lindenthal, the 57th Street Bridge, and the possibilities for a brighter future, in a frank letter to his mother: In order for you to understand my situation for many months, in fact for a whole year, I will no longer conceal from you that the giant project for which I have been sacrificing time and money for the past three years, today lies in ruins. In vain, I as well as others have been fighting against the unlimited ambition of a genius who is obsessed with illusions of grandeur. He has the power in his hands and refuses to bring moderation into his gigantic plans. Instead, his illusions lead him to enlarge his plans more and more, until he has reached the unheard of sum of half a billion dollars—an impossibility even in America. However, I have gained a rich experience and have decided to build anew on the ruins with fresh hope and courage—and, at that, on my own initiative and with my own plans, on a more moderate scale. It is a hard battle. . . .14

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But if Ammann felt compelled to strike out on a different course at the end of 1922, perhaps breaking free of Lindenthal, he would need to forge a new alliance which could help him achieve his goal. And this brought him to George S. Silzer.

The Alliance In November 1922, George Silzer, Democrat from Middlesex County, was elected Governor of New Jersey. He would serve as the state’s chief executive from January 1923 until January 1926, with the state legislature controlled by the Republicans throughout those years. Silzer was an activist in his philosophy of government, a Wilsonian Democrat. Indeed Silzer had been a state senator and one of Woodrow Wilson’s chief supporters in the legislature when Wilson was governor in 1911–13. One of Silzer’s strongest interests before and during his years in the state house was the improvement of highway transportation; he viewed this goal as crucial to the state’s economic growth. Thus he supported extensive road-building programs, as well as bridges connecting his own Middlesex County to nearby Staten Island.15 Consistent with his reputation as a Wilson Democrat, Silzer denounced the patronage traditions and inefficiencies of the existing county highway agencies, he created a new state highway body to devise an efficient road system, and he urged “scientific planning” in all areas of state government. Silzer could see the economic advantages that would flow to northern New Jersey if transportation to New York City were improved, and he could see the advantage to his own political prospects that might follow if a bridge across the Hudson, with its stimulus to development, were commenced during his term in office. So Silzer might be in a receptive mood if a feasible plan to dissolve the Hudson barrier were laid before him. Silzer’s victory in the 1922 election provided Ammann with just the opportunity he needed, as he tried to extricate himself from Lindenthal’s fixation. Ammann was already acquainted with the new governor, because Silzer had been an investor in the Such Clay Pottery Company, where Ammann had served as manager in 1917–20. Moreover, it seems clear that Silzer’s attention had been drawn to the challenge of bridging the Hudson through discussions with Lindenthal, another Such Clay investor, regarding the 57th Street span.16 At some point in the weeks before Silzer took office in mid-January, Ammann talked with him about the need for a Hudson River crossing, the eco-

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nomic and political problems that surrounded the Lindenthal bridge, and the advantages of a bridge farther north, joining vast and rural Bergen County to the urbanized New York shore. A northern crossing could be limited to motor vehicles and light trolleys, which meant that its cost would be far less than the Lindenthal colossus. Ammann had studied various sites, and he preferred a bridge that swept from the Palisades cliffs, in the town of Fort Lee, across the River to 179th Street in Manhattan.17 We have no direct account of the views Silzer expressed at this meeting, but as we will see below, later evidence clearly indicates that he was enthusiastic about Ammann’s proposed bridge, and that he hoped it might be financed by private capital. Moreover, Silzer was wary of the alternative “low cost” way to overcome the Hudson barrier—a series of tunnels under the Hudson.18 If a Fort Lee bridge was a promising idea, what role should Silzer take in advancing the cause? Silzer was a Democrat, and the area of his state that would be most directly affected by a new bridge at Ammann’s preferred location was Bergen County, a major Republican stronghold. Silzer and his party were not much loved in that northern suburban area, nor in the state legislature, which was also controlled by the party of Lincoln. If he hitched his political future in a public and sustained way to a campaign to build a great Hudson bridge, neither would be likely to benefit. It would be better for Silzer to leave the visible organizing efforts to community interests in northern New Jersey and New York; local business and political leaders would probably mount a vigorous campaign once Ammann had demonstrated the engineering and economic feasibility of the great design.19 However, Silzer could offer guidance on how Ammann and others interested in the Fort Lee bridge might gain local support. Also, he could contact leaders in the financial community confidentially, in the hope that private capital might be attracted to the scheme; and he could approach the recently created Port of New York Authority to ask if it would endorse such a bridge as consistent with its general goals.20 The major burden, then, fell to Ammann, and as the new year opened he faced a difficult task. He would need to develop local interest in his Fort Lee bridge—within the communities of Bergen County and nearby Passaic County, and across the River, in northern Manhattan and The Bronx, and perhaps further north in Westchester and southwestern Connecticut. Indeed, he would need to persuade local business leaders and elected officials not only that his bridge was an interesting idea, but that it was the best solution for the near future—better for the communities and for the economic

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growth of the region than the alternatives, which were already being actively discussed. Two of these alternatives—underwater tunnels at 110th Street and at 125th Street—also promised economic benefits for Bergen and Passaic, and for New York City; moreover, a private association had already been created to press for the 125th Street tunnel, and editors at Bergen’s major daily newspaper, The Bergen Record, were supporting that plan.21 Then there was the 57th Street Bridge. Ammann had not yet broken with Lindenthal. He still hoped the great man might be persuaded to join forces with Silzer and Ammann, and perhaps take a leading role in attracting the private capital and political support needed for the Fort Lee plan. But if Lindenthal stood firm, the prominent civic leaders and investors who had joined his board of directors would probably stand with him; and while that combined force might never produce a real bridge at 57th Street, its opposition might doom Ammann’s uptown scheme. How best to proceed? For Ammann, the answer came in three parts: He would need to sketch out a bridge design that was so dramatic, so arresting, that it would claim the attention and approval of the attentive publics of northern New Jersey and New York. And he would need to work out the probable cost for the bridge, so that it would strike a chord as financially feasible—in contrast to Lindenthal’s expensive scheme. Then he would need to take this design, and his ideas on how the bridge would benefit the region, directly to public officials and local groups on both sides of the Hudson. The first two steps were, for Ammann, comparatively easy. Trained in the great Swiss tradition, and apprenticed with Lindenthal, Ammann’s developed engineering skills were matched with considerable aesthetic instincts. And he had many years’ experience, with Lindenthal and earlier, in working out the detailed costs associated with bridges large and small.22 Ammann’s study of the problem led him to conclude that it would be possible to construct a bridge over the Hudson at 179th Street with a center span as wide as the entire River, even though such a span would nearly double the length of any bridge span yet constructed. That feat would permit Ammann to overcome a major obstacle to bridges across the lower Hudson—the concern that bridge piers would have to be placed in the River itself, providing a hazard to navigation and thus prompting a veto by the national government.23 Moreover, Ammann’s years of training and analysis led him to conclude that bridges with very long spans might carry sufficient deadweight to make extensive trusses unnecessary. Ammann’s own careful analysis supported this intuition, and he was then able to design a bridge which was strikingly light

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in appearance, and which carried a cost estimate proportionately lower than other long-span bridges.24 In addition, the expanding use of automobiles and trucks across the New York region—exemplified by long lines of vehicles waiting to use trans-Hudson ferries between Bergen and northern Manhattan—suggested to Ammann that traffic across a bridge at that location might, if a toll charge were levied, make the project financially self-supporting. The third step—knocking on doors, trying to convince skeptical and preoccupied local officials, newspaper reporters, and shopkeepers to embrace his scheme—that was a different story. Ammann had confidence in his professional abilities, and in the value of a great bridge at Fort Lee. But he was a modest man, and one who did not talk easily of his interests and his passions, especially when those interests would be linked to advancing his own career.25 However, in order to make any headway in developing public support for a bridge between Fort Lee and 179th Street, Ammann would have to break through his natural reticence and champion his own plan—until a civic organization could be formed to take the leading role in this public relations effort. This third step would also mean that Ammann would have to break formally with Lindenthal—unless he could convince Lindenthal to join him— so that Ammann could campaign openly for the uptown bridge. In the short run, this break would almost certainly mean that Ammann would have to join the ranks of the unemployed: to carry out the engineering studies for the Fort Lee crossing, and to campaign for approval, would absorb almost all his waking hours. There would be no time available to work on other projects with another engineering firm. In addition to these three dimensions of the campaign, he and Governor Silzer would have to find an operating organization which could take Ammann’s designs, raise the funds needed, and actually build the bridge. If Lindenthal were to change his views, his North River Bridge Company could do the job. Otherwise, Ammann and Silzer would need to explore ways of creating a separate private corporation, or alternatively of identifying a governmental agency that might undertake the complex project.

Into the Political Arena In the first months of 1923, the two men began their joint campaign. It was an effort that would extend through the next two years, with the engineer taking the lead. Ammann frequently spent his days in the political trenches, his

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nights bent over engineering drawings and calculations.26 Silzer was absorbed largely in other policy issues, accompanied by recurring political battles with an unfriendly state legislature; but he provided constant encouragement to Ammann and occasional guidance on political strategies. At several important points he also intervened directly to promote Ammann’s interests, which he made essentially his own. On January 9, Ammann reported to Silzer that he had met with the governing board of Bergen County, and that their initial reaction was to support “the bridge at Fort Lee.” They also agreed with Silzer’s view that no new vehicular tunnels under the Hudson should be constructed until the Holland Tunnel was in operation.27 A week later, Silzer was sworn in as Governor, and in his inaugural address, he referred to the great advantages of northern New Jersey: “It is especially attractive to those who find the congestion of New York City unbearable, and who seek to live in a section at once high, healthy and accessible.” But this high and healthy land was not really accessible, Silzer pointed out, especially to motor vehicles, which had to wait for hours to cross the Hudson by ferry. It was now time, Silzer argued, to give close consideration to building a bridge across the Hudson, a bridge “of ample size to care for vehicular and passenger travel, and for railroad terminal service.”28 During the next few months, Ammann met with several local groups in New Jersey, described his idea for a great span at Fort Lee, and received some encouragement; but no one offered to take on the major task of organizing support across the counties that would benefit from the crossing. Meanwhile, Silzer contacted Dwight Morrow, a Wall Street expert, for his view on whether Lindenthal’s bridge could be built with private capital; Morrow’s response, sent to Silzer on March 2, was decidedly pessimistic. And Ammann, noting that there was still much concern in Manhattan regarding traffic congestion that would be generated by a midtown bridge, and that the cost of the 57th Street Bridge was a major obstacle, urged Lindenthal to cut down the size of the bridge and move it northward. But Lindenthal was adamant, and by the end of March, Ammann had left his firm.29 Through the spring and summer of 1923, Ammann made little progress in gaining support for his own bridge. The possibility of a vehicular tunnel at 110th Street or at 125th Street, financed by investors, appeared to be of greater interest in the Bergen area, and that enterprise would almost certainly kill any prospects for a Fort Lee bridge. Other investors began to look at 40th Street as a possible site for private undertakings. However, during these months the tunnel investors, and their supporters in the New Jersey legisla-

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ture, found that they faced triple-barreled opposition—from the Port Authority, and from the chief executives of both states. The Port agency wrote to the governors, pointing out that its Comprehensive Plan included a set of tunnel projects, and it argued that no interstate crossings should be undertaken unless they were consistent with its program, which had the approval of the state legislatures. Both governors were sympathetic to the Port Authority’s position and vetoed the private-tunnel bills. At the time, Silzer was willing to consider private financing, but not of a tunnel which would undermine prospects for a bridge at Fort Lee.30 Smith, however, was adamantly opposed to having private corporations build and control any major highway arteries across the Hudson. He was also skeptical of relying on the existing interstate commissions, for they would need an infusion of state funds to construct additional tunnels. Smith’s clear preference was to place the development of all interstate crossings for motor vehicles as well as railroads entirely in the hands of the Port of New York Authority, which was authorized to use toll revenues to pay for its own projects—potentially sparing Al Smith and other state officials from the political burden of raising tax revenues for these expensive bridge and tunnel projects. By August, he had persuaded Governor Silzer to join him in issuing a statement which endorsed “the construction . . . of additional vehicular tunnels or bridges between the [two states] to be determined upon, constructed and financed by the Port Authority.”31 Smith’s views were important, but they could not be determinative. The Port Authority could assume these wider duties only if New York and New Jersey agreed jointly on new legislation; but there was strong sentiment in the Republican-dominated legislatures in both states to rely on the tunnel commissions or on private ventures, while Silzer continued to explore the privatefunding option. Through 1923 and perhaps well into 1924 the Port Authority’s own staff did not appear much interested in adding vehicular bridges to its duties. During most of this period, it was reasonable to foresee that the Holland Tunnel would be followed by a series of other tunnels under the Hudson built by the joint commissions, possibly with one or two others financed by private investors.32

The Port Authority Redefines Its Goals Concerned about the possibility that private tunnels uncoordinated with its own plans might be approved, and aware also of the governors’ August state-

6-1. Crossing the Hudson by motor vehicle: bridges and tunnels proposed during the early 1920s—tunnels at 40th, 110th and 125th Streets, bridges at 57th and 179th. The Holland Tunnel between Jersey City and Canal Street, underway since 1919, is also shown.

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ment, the Port Authority’s commissioners decided in November 1923 to hold a public hearing on “the proposed additional vehicular tunnels.” Now Governor Silzer and his bridge-building adviser saw an opportunity to enlist the Port Authority in their own campaign. The Port commissioners and staff had viewed their concern mainly in terms of tunnels for rail freight. But bridges as well as tunnels were plausibly within their domain; and though they thought mainly about railroads, they also had some interest in freight movement by truck—and trucks, of course, could travel on bridges as well as in tunnels . . . . On November 20, George Silzer met with Julian Gregory, an influential member of the Port Authority board of commissioners, and argued that it would be unwise for the Authority’s hearing to be limited to tunnels. That restriction, Silzer argued, “might be construed as limiting him [the governor], and the Port Authority, exclusively to tunnels,” whereas he was “open-minded to any bridge proposition that might come forward.” Indeed, the governor told Gregory, “he understood there was a strong sentiment on the part of some in favor of a bridge across the Hudson River.” At the Board meeting the next day, Gregory summarized Silzer’s views and suggested that the December hearing be expanded to include the question of bridges across the Hudson as well as tunnels—and the Port Authority board agreed.33 The Port Authority’s hearing was scheduled for December 5, and during the intervening weeks Ammann worked furiously to strengthen the analytical case for a bridge at Fort Lee. His calculations indicated that a single-span bridge at that location would cost no more than $30 million—in contrast to several hundred million for the Lindenthal project. Moreover, the immediate cost could be reduced to $25 million, if the electric railway tracks he had included in the design were deferred until later. On the basis of existing ferry traffic and studies by the recently formed Committee on the Regional Plan, Ammann then estimated that three million vehicles would use the Fort Lee bridge in the first year—enough to meet all annual charges, if a reasonable toll were levied. Assuming continued increases (“in a few years the traffic should treble,” he told Silzer), capital costs could also be paid off, and the bridge would surely become self-supporting.34 He then suggested to Silzer that they talk with “some of the prominent bankers” to see if private investors might be willing to underwrite such a bridge, and Silzer sent Ammann to confer with Dwight Morrow of the J. P. Morgan firm. Meeting in early December, Morrow and Ammann agreed that the bridge might well be self-supporting, but Morrow doubted that adequate private capital could be attracted; both wrote to Silzer to recommend

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that public funds be used—either state moneys, or bonds floated by the Port of New York Authority. The Port Authority’s public hearing strengthened Ammann’s position. Most speakers agreed that more vehicular crossings of the Hudson were needed; and while there was support for new tunnels below 57th Street, the prestigious Committee on the Regional Plan and other speakers argued for a bridge farther north. The crucial question was, who would take responsibility for such a bridge, and here Ammann’s own views were clear. “The most practicable way” to proceed, he wrote to Silzer the day after the hearing, would be to have the Port Authority take on the challenge—which would also allow that agency (so far with no construction or operating projects at all)—to “test its working ability.” Therefore, he urged Silzer to place Ammann’s Fort Lee plan “at the earliest possible moment before the Port Authority.” A few days later, the two men talked by telephone, and Ammann suggested that the Port agency should be asked to make definitive studies not only of the Fort Lee plan but also of other interstate crossings that had been proposed—bridges from Perth Amboy and Bayonne to Staten Island, for example, and a scaled-down version of the 57th Street span. If the Port Authority were to conduct such studies, Ammann noted, it would need an expert bridge engineer, and “I shall be frank in stating that I should be glad to occupy such a position.”35 Ammann and Silzer had agreed that Ammann would put together an extensive report on the Fort Lee project—covering technical engineering issues, traffic projections, financing questions, and probable impact of the bridge on regional development—and on December 17, Ammann’s 22-page analysis reached Silzer’s desk. That afternoon the governor forwarded the report to the Port Authority, with a letter from Ammann which concluded that the Fort Lee bridge could be paid for in 20 years. Silzer also released a public statement on his actions, noting that the Ammann plan was consistent with his own 1923 inaugural statement on the need for more Hudson crossings, and suggesting that the Port Authority could finance the Fort Lee bridge by issuing taxexempt bonds—with “ample security” provided by tolls on the bridge. The governor’s efforts for the day had not yet ended. He also wrote a private letter to Commissioner Julian Gregory at the Port Authority, suggesting that, in carrying out its studies of the various bridge plans, the Authority might want to secure the services of “such a man as Mr. Ammann, who is thoroughly skilled in this kind of work.”36 Gregory responded quickly, expressing his personal preference for bridging the Hudson at some point north of 125th Street. He also noted that Port

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Authority officials were now considering whether they should devote some attention to the role of trucks in moving freight in the region, and therefore to the need for vehicular tunnels and bridges. The Authority’s staff then reviewed Ammann’s report and on December 21, 1923, the Commissioners reported to the two governors that they would carry out a detailed study of the Fort Lee plan. Perhaps the Port Authority would now join Ammann in embracing the new automotive age!37 Ammann’s efforts were beginning to bear fruit. But the events thus far brought a measure of pain as well as pleasure. Most hurtful was the behavior of Lindenthal. Silzer had sent him a personal copy of Ammann’s detailed report on the Fort Lee plan, and on December 20 he responded with a letter to the governor, alleging that Ammann had stolen Lindenthal’s own ideas, and condemning his former associate for unethical behavior.38 Meanwhile, since the Port Authority had now agreed to make a close study of Ammann’s proposal, he waited for a call to join the Authority’s staff—and take part in that study—but in vain. Christmas came, and went, and Ammann was still an unemployed engineer.

On the Campaign Trail Unemployed, but with much to do. The Port Authority would study his Fort Lee plan and, he hoped, find that his engineering design and his analysis of costs, traffic flows, and financing were sound. But Ammann knew that the bistate agency—created to solve railroad problems, and staffed by railway engineers and statisticians—would be far more likely to take the next step and agree to build the great bridge if it found a groundswell of popular support for Ammann’s 3500-foot span. Moreover, legislative approval and initial state funding would be needed to get the project underway; here again, Trenton and Albany would be more willing to commit their funds and the Port Authority’s efforts to this project, if local groups in the nearby counties demanded action, for a bridge that “the public” felt was sorely needed. However, by the fall of 1923, the local terrain had become more complex, for a group of Bergen citizens had formed an association to lobby for Lindenthal’s 57th Street bridge.39 So Ammann once again threw his energies into the effort to organize popular support for the Fort Lee enterprise. Between late December and April 1924, he held dozens of meetings with chambers of commerce and other groups in Bergen and nearby Passaic and Morris counties in New Jersey; he wrote to and visited similar associations in The Bronx, Harlem, Washington

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Heights, Westchester, and Yonkers in New York State; and he traveled into Connecticut and explained his arguments for the Fort Lee Bridge before the Civil Engineering Society of that state. By December, Ammann had developed working sketches of the proposed bridge—with its thin, graceful roadway, and its great towers, which would be vast metal structures, sheathed in monumental stone. And now, when he spoke, Ammann could show his audiences some visual hint of his own deep motivations, which lay beyond engineering technique, beyond matters of practicality. It was true that the bridge would be a major engineering achievement; moreover, it would have a great impact on the efficiency of travel across a wide region, and so it would provide real benefits for residential choice, and recreation, and economic growth. But a vast structure like this could also be—should also be—a work of art, and here was a large part of Ammann’s incentive as he worked, without pay, to design and encourage the building of the Fort Lee Bridge. Years before, reflecting on the Hell Gate crossing, a monument to Lindenthal’s own aesthetic imagination and engineering skill, Ammann had argued that a great bridge in a great city, although primarily utilitarian in its purpose, should nevertheless be a work of art to which Science lends its aid. An elaborate stress sheet, worked out on a purely economic and scientific basis, does not make a great bridge. It is only with a broad sense for beauty and harmony, coupled with wide experience in the scientific field, that a monumental bridge can be created.40

Now he might have the opportunity to create such a bridge, if the public and the state legislatures would approve it—and if some other engineer, of “greater reputation,” were not chosen! By the first months of 1924, Ammann’s campaign had sparked enough interest in Bergen County that its influential state senator, William Mackay, was impressed. In March, meeting with Ammann, Mackay said he would champion legislation authorizing the Port Authority to construct a bridge at Fort Lee, as well as smaller spans between Staten Island and New Jersey. During the spring of 1924, the New Jersey legislature took the first bite, endorsing Port Authority surveys and construction of two Staten Island bridges, and New York State approved similar legislation. Soon after, Governor Silzer sent a brief note to the Port Authority’s general counsel, Julius Henry Cohen: “It has just occurred to me, in connection with the two bridges over

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Staten Island and your other bridge work, that the Port Authority ought to avail itself of the services of Mr. O. H. Ammann. . . . I understand that just at the moment he is available. . . .”41 Just at the moment, and for more than a year now. But still the Port Authority did not call. Although Ammann was willing to continue his organizing efforts, he had hoped that the various local groups might form a citizens’ association to press for the bridge project. In April, the Englewood Board of Trade and other business groups in the Fort Lee area seemed ready to create such an organization to coordinate efforts throughout northern New Jersey. Ammann then took his case across the River and was gratified when, early in May, the Harlem Board of Commerce—which had been a strong supporter of a tunnel at 125th Street—shifted its position and unanimously endorsed the Ammann Bridge. Back in New Jersey, Ammann met with a committee of northern New Jersey mayors formed to press for action on the Bridge, and he drafted a strategic plan which the committee could use in gathering further support.42 Unfortunately, neither the business associations nor the mayors mounted the needed campaign. And Silzer told Ammann that he still did not think it desirable for him—a Democratic governor—to become actively involved in trying to organize support in Republican territory. So Ammann once again found himself taking the lead, holding a series of meetings with local groups and state legislators.43 During the fall of 1924, the Port Authority sought bids for design work on the two Staten Island crossings, and Ammann responded. As he wrote to Governor Silzer on November 21, “I have submitted to the Port Authority a bid for the preparation of plans for the Arthur Kill Bridges and am now anxiously awaiting their decision.” And while he waited, his political efforts produced significant results. In November, State Senator Mackay urged prompt action on a bridge over the Hudson, and he endorsed Ammann’s plan as the most feasible. In the same week, the influential Bergen Record, which had favored a tunnel, endorsed action by the Port Authority to construct a bridge to upper Manhattan. By mid-December, the “Mackay Hudson River Bridge Association” had been formed, with the Record’s publisher and other county leaders as members. Finally, in late January 1925, the New Jersey Senate passed a bill authorizing the Port Authority to construct a bridge across the Hudson at Fort Lee, and the State Assembly soon followed suit. Ammann then journeyed to New York, where companion legislation had been introduced, and met with local and state officials, urging favorable action; in late March, New York State approved the bill.44

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From Political Entrepreneur to Bridge-Builder The Port Authority would now move forward to construct a bridge from Fort Lee to 179th Street, and to build the two spans between New Jersey and Staten Island. But would Ammann have any role in their design and construction? In a letter on March 27, Ammann conveyed his concern to the governor. He expressed his hope that he would be asked to “take charge of the working out of the preliminary plans” for the Fort Lee Bridge, but he thought there would be opposition, and that an engineer “with long practice and wide reputation” might be selected instead. Reviewing his many activities on behalf of the bridge project, Ammann concluded that he would appreciate “anything you may be able to do to help” achieve a favorable outcome. Two weeks later, with the Port Authority bills now signed in Trenton, Governor Silzer once again wrote to Julian Gregory, who was now Port Authority chairman. Noting that the Authority would soon be proceeding with the Fort Lee Bridge, Silzer suggested that “you take into consideration for the doing of this work the name of O. H. Ammann.” Silzer continued, “Mr. Ammann was one of the pioneers in this project, has spent two years of his time in advising the public of its advantages, has drawn freely upon his own ability as engineer, and in every way has probably done more than any other one man to bring this bridge into being.”45 Silzer also sent a copy of this letter to Chief Engineer William Drinker at the Port Authority; and he sent a copy to Ammann, with a note: “I have it in the back of my mind somewhere that Mr. Drinker had an impression that you were an able assistant, but that you had not had the experience to independently undertake work of this kind.” The governor suggested Ammann talk with Drinker about this impression. A few days later, Ammann met with Drinker. He thought it was an “encouraging interview,” though it contained disappointing news: Drinker told him that the Port Authority had concluded that their first projects—the two Staten Island Bridges—should be awarded to “an engineer of long established reputation.”46 The job went to Waddell & Hardesty, a firm led by the prominent engineer J.A.L. Waddell. However, in its short life the Port Authority had already begun to develop a few traditions—and one of these was a preference for hiring its own engineers and other experts as regular members of the staff, rather than relying heavily on outside contractors. By late April, the chief engineer (himself a railroad man) concluded that the Authority ought to hire a staff engineer with

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bridge-building experience; and Drinker recommended Othmar Ammann for the post. The Commissioners soon concurred with Drinker’s recommendation, and on July 3, 1925 Ammann sent a letter to Silzer noting that he had assumed his duties as “bridge engineer on the Port Authority staff” two days earlier, and thanking the governor for his “goodwill and efforts on my behalf.” The long and active campaign ended on a restrained note, with the governor’s final letter to an engineer who had at last landed a job and who would now have to show that he had the capacity not only to fight for—but also to build—a great bridge. July 15, 1925. My dear Mr. Ammann: I have your letter of July 3d, and am, as you know, pleased at your appointment, because I am sure that you will be of much service to the two states. Yours very truly, s/George S. Silzer Governor Mr. O. H. Ammann Boonton, N.J.

7 A Web of Bridges, Tunnels, and Political Intrigue

A democracy inclines toward chaos rather than toward order. . . . Since the “voice of the people” is a pleasant fancy and not a present fact, the impulse for positive political action must be deliberately imposed at some strategic point, if democracy is to succeed as a form of government. —Pendleton Herring, Public Administration and the Public Interest1

This bridge is evidence of what can be accomplished when true efficiency is applied to civic projects. . . . [It] presents a gratifying contrast to the story of delays, procrastination and endless disappointment which have been often the fate of great public enterprises in the past. —Franklin D. Roosevelt, essay in the New York Times (1931)2

W

hat Othmar Ammann had accomplished through his years of campaigning for a bridge across the Hudson was a striking achievement: the two states and their Port Authority had at last endorsed his plan for a span twice the length of any yet constructed, they had agreed to place some portion of their money and their reputations in the service of Ammann’s plan, and they had hired him to carry out the job. Yet in a longer view, what had been achieved by the summer of 1925 was but a first and modest step. For Ammann would now need to carry out a range of complex engineering calculations and grapple with design and construction issues that were likely to be far more difficult than his confidential early assurances had suggested.3 As he carried forward these analyses, he would have to thread his way between the two rocks that might bring disaster: On the one hand, he could design conservatively, relying on heavy trusses and other means of assuring safety; but that option would generate large costs that might require state subsidies and so expose Ammann and the Port Authority to the kind of criticism—of undue cost and inefficiency—that the Holland Tunnel and other 143

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public projects had often faced. Or he might design a bridge of spare materials and low cost, which—especially given the uncertain behavior of a span far beyond human experience—could collapse, a recurring fate of much shorter bridges through the years.4 Ammann would also need to gather and organize a large staff of engineers and mechanics who would carry out the many activities required to construct the Hudson River bridge, a task extending for five or six years. At the same time, he would need to supervise teams of engineers and others who would build the several crossings between Staten Island and the mainland.5 Moreover, Ammann could not look forward to carrying out these complex engineering and administrative efforts in an environment largely free from political and technical conflict—in the sort of benevolent atmosphere that he and Lindenthal had enjoyed while constructing the private Hell Gate Bridge a decade earlier. Public agencies attempting to carry out large engineering projects face an array of dangers, which flourish in the hothouse politics of New York and its environs. These hazards were amply displayed in the ongoing saga of the Holland Tunnel: an idea widely applauded when it was approved by both states in 1919, the Canal Street tunnel had been expected to cost less than $29 million and be completed by 1924. In the first three years, however, members of the tunnel commissions from the two states fell into dispute regarding patronage appointments to the staff, the engineering plan, and the question of who would pay for widening the Jersey City streets leading to the water crossing. In addition, construction funds from New Jersey were delayed for more than a year because of the need for a state-wide referendum. In 1924, five years after the enterprise was begun, most of the authorized moneys had been spent, the tunnel was only partly finished, and the commissioners asked for another $14 million. Meanwhile, patronage issues continued to affect their work, Governor Silzer denounced their “quarrels and bickering,” and New York’s Governor Smith urged that the commissions be abolished and their project be turned over to the Port Authority.6 If Ammann had consulted a reliable crystal ball as he began work in the summer of 1925, he would have discovered that the next six years in the Port Authority’s life would be filled with clouds almost equally dark: Ammann’s analysis of design issues regarding the great bridge would be sharply criticized by engineers in New York and by a politically influential manufacturer in Trenton; labor leaders with political clout in New Jersey would challenge a major construction contract for the Staten Island spans; and Silzer’s successor as governor of New Jersey would denounce the Port agency as a “super-state” and would join forces with Republican legislators in an attempt

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to influence Ammann’s design decisions, and to gain control over the Port Authority’s contracts. Ammann and his agency would also face criticism from those who opposed locating the tower and anchorage for the giant bridge in a Manhattan park; and a New York member of the Authority’s board would be embroiled in land speculation near the Hudson River bridge site and forced to resign. Then the Port Authority’s chief engineer would depart abruptly, and Ammann would be faced with the question of whether he could count on the loyalty of the engineering staff. And the Port Authority’s wider hopes for its multifaceted Comprehensive Plan—still bright in the minds of the commissioners and staff in 1925—would all be dashed by decade’s end. So it would be a future filled with obstacles and doubts, which might have retarded the completion of the Hudson River span and its three smaller cousins, generating spiraling costs and damaging the reputation of the untested Port Authority and its little-known bridge engineer. That conclusion would have demonstrated once again a recurring theme of political analysis—that “great expectations” at the start of a government project are likely to be overwhelmed by greater obstacles, leading to results that fall far short of our initial hopes, and often, as with the Comprehensive Plan, to outcomes that should be recorded as failures.7 But none of these difficulties, ultimately, undermined the regional and “nonpolitical” focus which seemed to motivate Ammann and the wider Port Authority team, or their capacity to move their projects forward. Unlike the tunnel commissioners, who often behaved as suspicious guardians of provincial rights, the Port Authority commissioners acted with some broader sense of the metropolitan region and grasped the banner that Julius Henry Cohen held out—which urged cooperation as the route to economic growth. Moreover, as part of Cohen’s original design, the Port commissioners had the power to finance construction by floating bonds; so they did not confront the political uncertainties of statewide referenda or yearly legislative appropriations. In these ways the Port Authority attained some political insulation denied the tunnel commissions. As we will see, the Port Authority leaders were not so unwise as to turn their backs entirely on the political forces linked to immediate public concerns, or the narrower traditions of political favoritism. Throughout the late 1920s, despite the opposition of Al Smith, they took a leading role in championing better passenger rail transit in northern New Jersey, an issue of great interest to commuters and local politicians in that province. And here and there, the Port Authority found room to build connections to wary political

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leaders by considering and sometimes accepting patronage appointments to its staff. However, the most important factor in providing integrity to the Port Authority’s efforts, and in keeping them on schedule through these six years was, undoubtedly, the agency’s bridge engineer. Ammann utilized his technical abilities and his administrative skills to press ahead with all four bridges at a surprising pace. And as each new bridge foundation was dug, each tower raised, each span completed, the press drew attention to the accomplishment, adding to the reputation of the bi-state agency and her Swiss-American engineer. So the contrast between the two bi-state agencies was immense: The tunnel commissions’ project stumbled forward finally to completion, after eight years of travail, in the autumn of 1927—more than three years behind schedule and $20 million over budget, its chief engineer dead from exhaustion. Ammann finished his four bridges ahead of schedule and under budget, the first two Staten Island bridges in 1928 and the Hudson River and Bayonne spans in 1931. As we will see toward the end of this chapter, that comparative success then prepared the way for the final victory of the Port Authority’s first decade, as Al Smith’s successor as governor, Franklin D. Roosevelt, joined forces with Cohen and the bi-state agency to oppose the expansionary interests of the tunnel commissioners. By 1930, they had wrested control of the Holland Tunnel from those worthy adversaries. The next year, the Authority swallowed the commissions as well, and it was then granted a monopoly over all bridges and tunnels that might in the future be constructed between the two states. So technical expertise was married to political strategy, to the greater glory of the bi-state agency—and perhaps to the benefit as well of economic development across the metropolitan region.

Engineering Judgment and Democratic Accountability The technical deliberations which triggered the early political battles in Trenton began innocently enough. In his early months as bridge engineer, Ammann hired a staff and began to grapple with the range of design issues that would have to be resolved before the Hudson River span could be started. How strong would the bridge need to be, to carry the maximum expected load of trucks, cars, and buses? Should it have one or two decks, and how many lanes should be included? Where, in view of rock and soil conditions, should the towers be placed, and (therefore) how long would the main span

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be—3900 feet, 3500, or somewhat less? Should the towers be bare steel, or covered with stone? How should the bridge deck be suspended from the towers—with wire cables or solid eyebar chains? The answers to these questions would have important implications for safety, aesthetics, and cost. On most of these issues, Ammann and his aides reached preliminary conclusions during the final months of 1925. But the decision on what suspension system should be used—eyebars versus wire cables—was more complex technically, and he decided that it deserved further study.8 Meanwhile, Ammann began preparations for constructing the first two Staten Island bridges, while he consulted with his supervisor, Chief Engineer W. W. Drinker, on design issues regarding the Hudson River span. By the end of the year, he saw substantial problems in the way that responsibility for carrying out these projects was distributed. Before Ammann joined the staff in the summer of 1925, the private firm of Waddell & Hardesty had been hired to provide designs for the Staten Island spans; and during the fall they continued to carry some responsibility for working out the details of the two projects. Meanwhile, Drinker began to second-guess the work of his bridge engineer, in ways that made it difficult to press ahead with plans for the Hudson River project. Moreover, the administrative structure of the Port Authority did not provide clear lines of central authority, so that differences could be hammered out and decisions made quickly: the chief engineer, the chief of the statistics bureau, and the general counsel all reported to the Chairman, who was a part-time unpaid official. This arrangement may have been satisfactory while the agency was devising broad regional plans and negotiating with the railroads; it did not seem to be working well as the agency attempted to get its own large construction program underway.9 Early in 1926, these problems were swept away in a major reorganization. John Ramsey, who had headed the statistics bureau, was named by the Board to be chief executive officer; and Ammann would now report directly to him, serving as bridge engineer, in charge of a new Bridge Division. Drinker was shifted out of the line of responsibility, as “chief consulting engineer”; and Waddell and his associates were limited to an advisory role.10 Ammann was now fully responsible for carrying out the bridge projects, and by March 1926 he completed a report to Ramsey and the Board on detailed plans for the Hudson crossing. Within a few weeks, his plans for the gigantic span had drawn favorable attention to the project and to the Port Authority.11 A few weeks later, Ammann’s position was further strengthened: George Silzer had completed his term as governor in January, and in May he was appointed to the Port Authority Board. Silzer’s fellow commissioners at

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once named him chairman, so that this crucial position in shaping the agency’s future was now held by Ammann’s main political adviser and supporter. During the summer, Ammann pressed ahead with plans for the two Staten Island spans, and in September, the Port agency again was a center of laudatory media attention as ground-breaking ceremonies were held for the two bridges. These signs of a beneficent providence were soon followed by less happy events, reminding us that even a “successful” government agency could not long be insulated from the discipline of “democratic accountability” and from its cousin, patronage politics. The political conflicts affecting Ammann’s work became the subject of public attention early in 1927, but their origins go back to the transfer of gubernatorial power in Trenton a year earlier. To Governor Silzer, who held office in 1923–26, the Port Authority was a benevolent “supergovernment,” created by the two states to meet important social needs, and endowed with the independence required to accomplish those tasks. Limited to one three-year term by the State Constitution, Silzer stepped down in January 1926. He was succeeded by A. Harry Moore, a fellow Democrat and a close ally of Frank Hague, who was mayor of Jersey City and head of the Democratic political machine of Hudson County. To Moore (and to Hague), the Port Authority’s independence appeared to violate appropriate standards of democratic control, and in his early months in office, Moore encouraged Republican efforts in the state legislature to craft a bill that would give him veto power over the agency’s decisions. By the summer of 1926, Moore was expressing doubts about the concept underlying this “super-State.”12 When the state legislature returned to work in the early weeks of 1927, the Moore-Hague Democratic forces and those Republican legislators who were hostile to the Port Authority’s independence found their concerns quickened by a debate from the world of engineering: Would wire cables or eyebar chains be used to suspend the roadway from the massive towers of the Hudson River bridge? (Eyebars are metal bars with eyelets at both ends; they are joined via bolts through overlapping eyes. Wire cables are composed of thousands of individual steel wires spun across from tower to tower and then bound together.) If the answer turned out to be wire cables, Trenton was the home of a leading manufacturer, and new jobs and economic vitality might be added in New Jersey’s capital; but it was rumored that the Port Authority’s bridge engineer was inclined the wrong way—toward eyebar chains. The contest on this question, which soon became intertwined with the general issue of political control over the Port agency, provided the strongest challenge to engi-

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neering integrity and general autonomy that the agency had faced in its first decade, and that it would confront during the next twenty years. In his early months as bridge engineer, Ammann had indicated to his engineering associates that he thought eyebar chains might be the better choice for suspending the roadway from the great towers, and in December 1925 he met with the contractor which had recently constructed a long eyebar suspension bridge in Brazil. As Ammann explained at some length in one staff memorandum, eyebars seemed to have some advantage in terms of cost, reliability, and aesthetic considerations; but he planned to carry out detailed studies of wire cables as well.13 Throughout 1926, Ammann continued to weigh the relative advantages of eyebars and cables, and no decision had yet been made by early 1927. Then, on March 16, New Jersey’s leading manufacturer of wire cable decided to enlist political pressure in support of its campaign for the Hudson bridge contract. Writing to Governor Moore, the Roebling Company’s vice president urged that eyebars not be considered further, since wire was clearly superior in terms of reliability and aesthetics. He also noted that, unlike the Roebling Company, neither of the eyebar manufacturing plants “is located in the State of New Jersey.”14 Now Moore and his Republican allies had a specific issue to accompany their general unease. The antagonism of Moore and his Hudson County associates was heightened further in mid-March, when chairman Silzer appointed Larry Keefe, a journalist who had written critically of the Hague machine, to be the Port Authority’s director of public information.15 By late March, Democratic legislators from Hudson County had joined forces with a group of Republican lawmakers to pass a bill requiring that the “State House Commission” review and approve all Port Authority bridge contracts; the State House Commission had traditionally been used to monitor patronage distribution in the state. Moreover, the explanatory statement accompanying the bill showed a “protectionist” philosophy at work.16 The Port Authority and its champions in New York State were suitably alarmed. In Albany, Al Smith issued a statement threatening to sue New Jersey for violating the Port Compact. To safeguard his state’s interests, he also sent an emergency message to the legislature, asking that the governor of New York be given the power to veto decisions of the Port Authority. At the Port agency, chairman Silzer issued a public warning to Moore, urging him not to sign the bill. If the State House Commission were given the right to review and block Port Authority contracts, Silzer asserted, the Authority would “face litigation over every contract from now on”; moreover, all four

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bridges would be delayed a year, costs of construction would rise, and the “era of good feeling” between the two states might be destroyed.17 But Governor Moore saw greater dangers if he did not act. Releasing the Roebling letter to the newspapers, he argued that the Port Authority favored eye-bars over wire cable, and therefore that New Jersey firms would be “excluded from bidding,” thus “depriving hundreds of our people of the work which this gigantic undertaking would supply.” There was also a broader issue. “In the Port Authority we have created a superstate,” the governor complained, “which may act without regard to the governing body of either State.” To Moore, the State House Commission bill was an essential step in safeguarding both New Jersey’s economy and democratic accountability. On March 30, he signed the bill into law.18 If the Port Authority had been the creature of a single state, the Hudson County Democrats and their Republican allies would have won this battle. However, the wider war—to control the Port Authority as though it were a regular state agency—might still have been in doubt, since the bond houses may have shied away from securities whose value could be undermined by political intervention.19 But now the advantage of the Port Authority’s structure could be seen: Because the agency was accountable to two masters—the two states—it was less accountable to either. What one state wished to do, its partner could resist; and so the bi-state agency might retain much of its independence against the slings and arrows of outraged politicians and advocates of localized democracy.20 Once Moore had signed the State House Commission bill, New York’s Governor Smith picked up New Jersey’s gauntlet. He threatened to take the issue to the U. S. Supreme Court, where he would ask that the new statute be set aside and that the Court “restrain New Jersey from interfering with the Port Authority”; and he instructed New York’s Port commissioners to refuse to send any bridge contracts to Trenton for review. Meanwhile, Ramsey, Cohen, and their aides suspended all activities associated with the four interstate crossings.21 Smith’s challenge, coupled with the Port Authority’s abrupt halt in its work, had the desired effect. Business leaders in New Jersey protested, arguing that the conflict threatened economic growth in the northern part of the state, and urging that the Port Authority resume work on the four bridges. Bergen County’s Senator Mackay, a leading Republican who had fought unsuccessfully against the State House measure, now introduced a bill to repeal the law. Governor Moore distanced himself from the measure he had signed, arguing that “it was not my idea” and that he would prefer to vest the veto

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power in the governor. And Ammann undercut the argument—which had been used to rally support for the State House bill—that his plans would block the Roebling Company and New Jersey workers from a major contract; wire cable as well as eyebar chains were still being considered, he said, and the Roebling Company was still in the running.22 Within 48 hours, the State House Commission law had been repealed at Trenton, and in its place the state legislature approved a bill giving veto power over Port Authority actions solely to the governor. Al Smith had always opposed any veto power, preferring to leave the Port agency as an “independent” body, but he now signed a bill in Albany giving him similar control over the Authority’s actions.

Ammann’s Plans: “Unduly Experimental and Out of Harmony” By the spring of 1927, the Port Authority and its bridge engineer had won a crucial battle to maintain professional control over engineering decisions. No “state house commission” would have the power to bend the Port Authority’s contracts to achieve narrow political goals; and for the next several years, no governor would risk another uproar by using the veto power to interfere with the bridge-building program. But Ammann and his staff faced a series of other challenges. Some of these came from his professional colleagues, who questioned his view that the Hudson River bridge “presents no unusual engineering or construction problems.” At a gathering of civil engineers to discuss the project, R. S. Buck said that he found Ammann’s design “unduly experimental and out of harmony with . . . the preponderance of engineering opinion.” Buck argued that several alternative designs should be considered, particularly since Ammann’s plan seemed to be based on “novel and inadequately tested concepts.” He criticized Ammann’s proposal to place the Manhattan anchorage in Fort Washington Park, where it would provide a “high barrier of masonry,” detracting from the park. He offered an extensive critique of eyebar chains, which he argued were not a sensible way to suspend the bridge. And he attacked Ammann’s plan to cloth the steel towers in masonry as poor engineering, unnecessarily costly, and “an architectural crime.”23 Buck’s colleague, C. W. Hudson, agreed with these criticisms and argued that the Port Authority’s plans seemed to be unwisely tilted in favor of eyebar chains. Even sharper were the comments sent to the Port Authority by Fred-

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erick Stuart Greene, a prominent New York engineer who had been asked to serve on an advisory committee on bridge design and location. In March, Greene wrote privately to John Ramsey, now the Authority’s chief executive officer, to comment that: Among engineers generally the conviction prevails that the present design is uneconomical; that it is at variance with the best modern practice in suspension bridges; . . . that the design for the towers is wholly wrong; that the omission of a stiffening truss is too radical a departure; and that the use of eye-bar chains in place of wire cables would be not only more costly to erect and maintain, but that they cannot produce as good a bridge.

From his attack on Ammann’s design, Greene turned to Ammann himself. “It is a bad policy for the design of a bridge that goes so far beyond anything yet undertaken to be left to one man,” Greene argued, “especially to one who has not had the advantage of actually building an important suspension bridge.” Greene urged the Port Authority to turn over responsibility for designing the Hudson bridge to a Board of Engineers, composed of “not less than three men of known experience and ability.”24 Ammann paused in his engineering efforts long enough to inform the Port Authority commissioners that both wire cables and eyebars were still under consideration, and that their own “eminent consulting engineers” agreed with him that existing plans for the Hudson crossing were the best available. He also responded to the criticisms by Buck and other defenders of Fort Washington Park with a vigorous counterattack, arguing that shifting the bridge tower out of that park might result in a “monstrous monument to the lack of aesthetic sense.”25 With construction already underway at the two Staten Island bridge sites, and with ground-breaking expected at the Fort Lee site early in the fall of 1927, Ammann also took steps to reorganize the Bridge Department, dividing the staff into separate divisions for traffic studies, design, contracts, construction, and planning of approaches. Plans were circulated among all sections, and Ammann and his assistants encouraged continuous communication among office staffs and the field. His management strategy was innovative, offering lessons that would be rediscovered by administrative theorists decades later. And despite the complexities of putting this new plan into effect, and the external attacks on Ammann’s designs, the engineering staff seems to have responded favorably to his leadership.26

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Soon, however, the chorus of outside critics was joined by a more formidable opponent—Ammann’s former mentor, Gustav Lindenthal. In August, 1927, Lindenthal attacked the proposed design of the towers for the Fort Lee span, which he argued would generate unbalanced stresses and produce a bridge of questionable safety. Ammann responded forcefully, asserting that the critique by his former boss was couched in “vague, generalized and unqualified terms,” and that Lindenthal had failed to examine Ammann’s design closely.27 So Ammann asserted his independence, a stance that was underscored that same month in a press release issued by Chairman Silzer, who endorsed Ammann’s position that “both eyebar and wire cables” were still under consideration, and that the choice would depend on which contractor offered the best proposal. (Silzer’s press statement had an odd twist worth noting; while he endorsed engineering independence and efficiency as guiding lights at the Port Authority, Silzer also included in this Port Authority press release a statement of his hopes that Al Smith would soon become president and that a Democrat would win the New Jersey gubernatorial election in 1928. No wonder the Republican legislators had the impression the Port Authority was a “Democratic agency”!28) Ammann was forced to grapple with one more foray from that creative political strategist, Governor Harry Moore, before the year was out. During the spring campaign on the veto-power question, the Port Authority and its friends had argued that it would be unwise for a governor to attempt to second-guess the agency’s decisions, because they were based on technical studies, outside the ready ken of elected officials. Now that he had the veto power, Moore thought he would take advantage of that implied advice and designate his own engineering consultant to monitor the Port agency’s work; in July he asked the agency to add Joseph Strauss to the engineering staff, so that Moore could have independent technical advice in evaluating Ammann’s activities. The board acquiesced, and Strauss, an engineer from Chicago, was formally appointed to the board of advisory engineers in early August.29 Within a few days, Strauss urged that the steel contracts for the Hudson span be delayed “until I could complete my investigations”; but Ammann and his consulting team disagreed and went forward with the contracts. During the next several weeks, Strauss seems to have been largely excluded from meetings of Ammann and his staff, and from Ammann’s discussions with the other consultants, which now included bridge designer Leon Moisseiff, General Goethals of Panama Canal fame, and William Burr of Columbia University. However, Strauss carried out an independent review of Ammann’s

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plans, which he found deficient in several ways, and he delivered a critical analysis to Ammann in late September. Expecting to be called in to discuss his report with the other consultants, Strauss waited in New York until a meeting time was set. And he waited. And while he waited, Ammann and his consultants met, reviewed Strauss’s ideas, and rejected every one. In mid-October, the Port Authority awarded the major contracts for the towers, floor, and cables for the Hudson River span, based on the specifications defined without Strauss’s help. In frustration, the governor’s man sent a lengthy confidential report to Moore, laying out his various ideas, which if accepted might still save “many millions” of dollars. Strauss also hinted that Governor Moore could in time be “subject . . . to embarrassment,” if the public later learned that Ammann had failed to take action on these cost-saving ideas, and that “those in superior authority” had allowed his inefficient plans to go forward.30 But Moore was now beyond Strauss’s help, and probably glad to be so. The issue that had focused his political energies was swept away with the Port Authority’s announcement in mid-October that wire cable, not eyebars, would be used on the Hudson bridge—and that the Roebling Company of Trenton was the low bidder and had therefore won the contract. To the Port Authority, the drawn-out process had been justified, for the competition between wire and eyebar manufacturers appeared to have produced cost savings of several million dollars.31 And to Moore, whose labor supporters would be pleased with the prospects of new jobs in the Trenton area, the outcome was a political blessing. Moreover, it was part of a rain of pro-Port Authority sentiments that swept the state and the New York region during the fall of 1927 and continued into the next year. Moore found it easier to associate himself with a winner than to battle a “superstate” whose friends might harm his future political career. So it was not surprising that even before the wire-cable decision, Governor Moore agreed to take part in the formal ground-breaking ceremonies for the Hudson River bridge. At that event, Ammann received a medal which was inscribed “His Genius Made It Possible”; Moore heard his fellow Democrat in Albany praise the Port Authority’s efficiency and call it “the modern agency for progress in public works”; and the mayor of New York City said that his city no longer viewed the Port agency as “some superpower actuated by selfish purposes” but instead as the “best” instrument to solve regional problems. Then Moore himself rose to acclaim this giant bridge as “another link in the strong bond which binds us in friendly and business relations with the great Empire State.”32

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Moore had already seen the Port Authority and her bridge engineer praised for their efficient efforts in completing the first two Staten Island bridges, which would soon be opened, months ahead of schedule; and its reputation had reached the nation’s capital, where the Port agency was described as offering a model for financing a new bridge across the Potomac. The day after the ground-breaking salute, the Newark Evening News saw in the Hudson River span and its builders the promise of a “new day of concord which leads men of differing aims to seek and find agreement by the way of common sense and common brotherhood, instead of remaining apart and nurturing misunderstandings, jealousies and rivalries boding no good to either.”33 Indeed the days of interstate acrimony—the lifeblood of John Hylan and his suspicious counterparts in Hudson County—seemed to be at an end in the gentle autumn of 1927; the cooperative philosophy of Julius Henry Cohen held sway, at least for now. So Harry Moore sent Joseph Strauss and his disruptive ideas packing. And when the Port agency’s unflagging critics announced new charges, alleging unfair contract procedures at the Staten Island bridges, Moore acted quickly to lay those allegations to rest.34

Engineering Victories The “new day of concord” which the Newark News envisioned in the fall of 1927 did not bathe all the Port Authority’s proceedings with its gentle light; during the next four years there were battles to be fought, and won and lost, across most of its endeavors. But Ammann and his activities were now freed from political incursions; and from the winter of 1927 until the George Washington Bridge was completed in 1931, the Port Authority’s engineering division served as an exemplar of the Progressive theme—demonstrating what government could do, if individuals of talent were brought together, given a clear mission, and insulated from the uncertainties of politics while they carried out their assigned tasks. We may call this Progressivism, but its American heritage extends back to the civil-service reform movement of the late nineteenth century and before.35 The highlights of these four years can be set down in a few paragraphs. In the fall of 1927, an article in the Scientific American nicely captured the linkage between the new bridge and the expansive public thinking of the 1920s; in this “age of superlatives,” the essay began, the Hudson River crossing “will be incomparably, on completion, the greatest suspension bridge, or bridge of any kind, for that matter, in the world.” In addition, Ammann’s creative en-

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gineering and management strategies in constructing the Staten Island spans were examined by the Engineering News Record and praised for their flexibility and effectiveness.36 Early in 1928 Ammann was promoted from bridge engineer to chief engineer at the Port Authority. With construction proceeding rapidly on the two Staten Island spans and the Hudson bridge, he began to design a fourth span, approved earlier by the two states, which would join Staten Island and Bayonne, New Jersey. In April, the Port Authority announced that the first two bridges—to be called the Goethals and the Outerbridge Crossing—would be completed by the end of June, six months ahead of the original schedule; and during the spring newspaper articles emphasized the great economic stimulus for Staten Island that would result from these projects joining the Island to the mainland. Ammann’s crucial role in the Hudson River enterprise was featured in a long magazine article in June.37 During the summer, with construction on that bridge ahead of schedule, and with the two Staten Island spans opened to traffic, Ammann completed his design for the Bayonne crossing, which would become the longest arch bridge in the world. Ground-breaking ceremonies on September 18 were led by that convert to the Authority’s ways, Governor Harry Moore. For a while, the Port agency, and those who reported on its efforts, attempted to treat these automotive bridges as though they were integral pieces in the Authority’s 1921 Comprehensive Plan, with the rest of that great program then to follow. A closer look, however, in time convinced even the optimists at the New York Times that all the elements of that plan were in disarray—at best in “the blueprint stage,” where they had languished since 1921. In contrast with “this gray background,” as the Times explained to its readers in 1929, the four bridges “stand out in shining colors,” and the agency’s strategy of financing those projects by selling its own bonds offered “the most constructive approach yet afforded” to the problem of funding large public projects “without overburdening the taxpayer or straining municipal credit.”38 With its bonds finding eager buyers in the halcyon days of the late 1920s, and its chief engineer orchestrating the work of his staff and contractors with striking efficiency, the Port Authority was able to press steadily toward completion of those two landmark structures—the longest suspension span and the longest arch bridge ever built. By June 1929, the two towers of the Hudson River crossing were finished, and the Port agency then began to spin the Roebling wire cables over the chasm. At the end of the year, 10,000 wires had been strung from tower to tower, leaving 95,000 to go. Meanwhile, Ammann constructed a large testing laboratory building in Jersey City, housed his in-

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spection force there, and set them to work testing all the materials that were being used in the Bayonne and Hudson crossings.39 During the first months of 1930, the Port Authority reported that construction on the two spans was on schedule, and that both would open early in 1932. However, cable spinning above the Hudson proceeded at an unusually rapid rate, and the operation was completed in August 1930, establishing a new record for speed in stringing wire cables on large suspension bridges. By the end of the year, all the steel floor panels were in place, and the Port agency announced that the Hudson River crossing would be opened for traffic in the fall of 1931. At Bayonne, 18 miles to the south, the two sides of the great arch were joined in October 1930, and this bridge too seemed likely to be finished well ahead of schedule. In these final months, the only real controversy arose over the naming of the Hudson crossing: should it be called the Palisades Bridge, the George Washington, or simply the Hudson River Bridge? After active public debate, the Port Authority commissioners finally made their choice, by a divided vote, in April 1931.40 These two vast enterprises then moved steadily to completion. On October 25, 1931, the George Washington Bridge was dedicated, and it was opened to traffic at 5 a.m. the next day. The Bayonne crossing followed on November 15. Both were celebrated for speed and efficiency of completion, for low construction costs (both were well below estimates), and for their world-setting length and elegance of design. The comments of the Engineering News-Record on the Hudson River project capture the impact Ammann’s efforts in those years had on his fellow professionals: The Fort Lee Bridge . . . marks an epoch in the annals of civil engineering. In virtually every element, from its towers and anchorages to its cables, its unstiffened deck, its ingenious floor construction, its provision for double-decking, and not least its unprecedented traffic-distributing approaches, which will make the operating efficiency of the bridge a match for its efficiency and economy of construction, it establishes a new datum from which future bridge engineering will take its measure.41

Yet Politics High and Low If Ammann’s efforts in these four years demonstrated the benefits of Progressive insulation, the rest of the Port Authority’s endeavors were nicely laced

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with politics, suggesting how large a gap remained between the hopes of the agency’s creators and the realities of political culture in America. Once the railroads and the ICC had finally rejected the major tenets of the Comprehensive Plan, in 1928, those who had favored a “go it alone” policy for New Jersey revived the old lighterage issue, which then generated recurring political tension between the two states into the 1930s. Meanwhile, the Port Authority’s efforts to apply its expertise to other fields of transport—rail transit and air—came to naught, with its passenger transit forays leading to conflict with Al Smith. In addition, patronage and favoritism nibbled at the doors in the late 1920s, and Republican opponents labeled the Port agency as a “socialistic” enterprise and sought to bring it to its knees. Under the leadership of its general counsel, however, combined with the efforts of two New York governors, the bi-state agency managed to turn some of the challenges into victories, using its dramatic successes in bridge-building together with a modicum of tactical ingenuity to emerge in 1931 as a potentially powerful engine of future regional growth.

The Lighterage Issue Once Again Least successful were the efforts of Cohen and his colleagues to reorganize the railroad patterns in the bi-state region, and to maintain unified support from both sides of the Hudson as they pressed for improved efficiency in the region’s freight rail system. As we have seen in chapter 5, the Port Authority’s Comprehensive Plan had been blocked by the railroads, and its efforts to use the ICC’s powers to break that resistance had failed—most dramatically in the Hell Gate Bridge case in the summer of 1928. A few months later, the Port agency did win support of the rail executives for a single project which might improve efficiency in distributing goods in the region—an inland freight-transfer building in Manhattan. At this point, however, the fragile alliance which supported its “regional” efforts began to fray. Defenders of New Jersey’s interests had already expressed concern that the state’s economic growth would be harmed by creating a large freight transfer station on the New York side of the River.42 Once the Hell Gate case was lost, there was much doubt that the bi-state agency could accomplish any important part of its vaunted development plans for the New Jersey side of the Harbor. Advocates of vigorous economic-development strategies in that smaller state now urged that its officials pursue its own interests, and in March 1929, New Jersey reopened the long-dormant lighterage case.

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The 1929 campaign—to force the railroads to charge less for freight delivered to New Jersey terminals—appears to have been more broadly based than the effort a decade earlier. In addition to elected officials and business executives from Jersey City and nearby towns, the new initiative had wide support among Republicans in the legislature, which appropriated $50,000 to finance the lighterage battle. It had support from officials of several regional industries, and from the Newark News, perhaps the state’s most important newspaper. And it had the vigorous endorsement of the new governor, Morgan F. Larson—the first Republican chief executive since Walter Edge had left the statehouse in 1919.43 Larson set the tone of the campaign in a major address in October 1929, when he described New York and New Jersey as “two great giants with limitless possibilities.” “All I ask,” Larson continued, “is that the giant New York which has prostrated New Jersey give this giant of ours a chance to rise.” He viewed the lighterage suit as the way to remove that oppressive weight. By the first weeks of 1930, a group of municipal officials and chambers of commerce in northern counties had organized support for the state’s position before the Interstate Commerce Commission, and the ICC was once again preparing for hearings on this contentious issue.44 The Port Authority was placed in an awkward position. In its first several years, the Authority’s commissioners had used the mission of the agency—as enunciated in the Compact, in briefs before the ICC, and in speeches by its leaders—as a touchstone for its opposition to any efforts to break the Port into two parts. In 1927, however, the governors had obtained the power to veto the commissioners’ actions, and now, with Larson as governor, they faced an announced opponent of the idea of cooperative, regional development. Moreover, in his early months in office, Larson demonstrated that he might block the Authority if it attempted to act against his wishes. Meanwhile, the Port agency was locked in a struggle, described below, to wrest the Holland Tunnel away from its owners, and in that battle it needed Larson’s support, not his enmity.45 Therefore, the Port’s leaders decided not to confront the latest New Jersey challenge head-on. Instead they spoke generally of the great advantage of a unified Port of New York (and New Jersey): “objective cooperation is today the keynote of commercial success.” They conferred with manufacturers in New Jersey who benefited from “free” lighterage, and those businesses then took the lead in opposing the effort to alter the traditional system of freight charges. And they emphasized the need for modern, efficient marine termi-

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nals throughout the region, and described their plans for constructing steamship piers at Jersey City and at Hoboken.46 Meanwhile, the ICC began the laborious process of reviewing freight rates in the New York region. More than three weeks of hearings were held in the summer and fall of 1930, and the ICC then moved with its usual speed toward a conclusion. The year 1931 went by, without word from the Commission; and then 1932 followed in graceful silence. It was not until 1934 that the ICC handed down its opinion—which essentially denied New Jersey’s request and retained the Port of New York in its unified, if somewhat decrepit, state.47 So the Port Authority escaped the worst possibilities that had been threatened by the revival of the lighterage case: the New Jersey suit had failed, and the region would not face the economic warfare that might have followed, had the Port been split in two; moreover, the Port agency had managed to avoid taking a central role in opposing the New Jersey suit, so it could still wave a credible banner as representative of both sides of the harbor. Beyond these largely negative achievements, however, the Port Authority had little to show for its first ten years of work on rail and marine-terminal modernization. The varied parts of the Comprehensive Plan were in tatters, with a single freight building in Manhattan—to be completed in 1932—as the only clear step toward “greater efficiency” in the region’s rail freight system. The proposals for marine terminals at Hoboken, Jersey City, and Jamaica Bay remained paper plans, victims of the economic downturn.48

Passenger Rail and Air Transport: Halting First Steps In its role as expert analyst and long-range planner for the region, the Port agency also devoted some attention in its first decade to passenger rail transit and airport development. In the short run, the most important outcome of these efforts was to demonstrate once again that the Port Authority was not a Trojan Horse of Manhattan business—that it was able to champion New Jersey’s interests as well. In addition, the two forays were preludes to a range of vigorous political battles that would absorb the Authority’s energies after World War II, when it would fight with Robert Moses for control of the region’s airports and resist pleas that it take responsibility for the region’s decaying rail transit system. In 1926, staff members at the Port agency began a study of possible sites for commercial landing fields in the New York region, and the next year this group joined a wider committee appointed by U. S. Secretary of Commerce

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Herbert Hoover to “investigate and report on a New York Metropolitan Airport.” Its report at the end of 1927 identified two sites in northern New Jersey and six in New York City, and urged the cities and states to develop several of these. There seemed to be little prospect that airports would be self-supporting operations in the near future, however, and the Port Authority did not view itself as having an important role in airport development.49 The efforts of the Port agency to advance the cause of rail transit were more sustained, although they produced only planning documents and political conflict, not visible change. During the 1920s, the number of New Jersey residents crossing the Hudson River to work and shop in New York expanded rapidly, and most of these travelers had to rely on ferry service to reach their destinations. Planners and political leaders in the northern part of New Jersey urged that the 28 miles of streetcar lines which ran through their communities be expanded and linked across the Hudson barrier to New York City’s vast passenger rail system. The Port Authority’s duties already embraced rail lines used for freight; and Ammann’s early designs for the George Washington Bridge included streetcar rail trackage. Therefore, the Port agency was a natural place to look for plans to improve passenger rail travel; regional planners on both sides of the Hudson viewed it as an important player in their efforts to overcome the limitations of relying on ferry service across the Hudson and, more generally, to strengthen transit systems joining northern New Jersey, Westchester, Long Island, and the region’s center.50 In 1925 a legislative committee suggested that the Port agency might take on a central role in grappling with the rail passenger problem. Publicly, the Port Authority’s general counsel responded cautiously, suggesting that his agency could be asked to study the situation and recommend plans, and that it could later “be directed to effectuate the plans”; but he emphasized that he was taking no position on whether rail transit should be added to the Port Authority’s duties. Privately, however, Cohen took an expansive view and attempted to persuade Al Smith to endorse broadening the Port Authority’s mandate.51 Early in 1927, the state legislature in Trenton directed the Port Authority to study the interstate transit issue, recommend solutions, and consider whether it might then take the central role in carrying out the transit plans. Officials from New York’s suburban counties asked that the study be expanded, and staff members of the Port agency soon joined with representatives from all parts of the region to create the Suburban Transit Engineering Board. During the next year, this team studied rail passenger travel,

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new rail lines under the Hudson and in other parts of the region, and financing issues.52 Although these efforts were widely supported in the suburbs, New York City leaders objected, arguing that the Authority’s efforts seemed to infringe on their own control over transit planning; and Al Smith thought these passenger transit efforts were a distraction from its work on the freight issue. Early in 1928, Albany legislators passed a transit-study bill matching New Jersey’s, but Smith then vetoed it. Now the Port Authority resisted Smith’s judgment; having devoted a year to working on the passenger problem, and seeing possibilities for real improvements here that had been denied in the field of freight transport, the agency was unwilling to abandon the project. Instead, the Authority’s commissioners spoke out in words that would warm the hearts of idealistic planners everywhere, and they set forth a perspective that the Port Authority’s own planners would later abandon: “No adequate or effective interstate transportation development can take place, without taking full account of passengers as well as of freight throughout the Port District.”53 During the next three years, the Port agency continued to devote staff resources to possible improvements in passenger transit. Finally, in the fall of 1931, as the Depression deepened and passenger traffic dwindled, the Port Authority and its regional colleagues suspended their activities. So the bistate commission was again frustrated in its hope for a grand regional solution. It had clearly demonstrated, however, that it was no pawn of New York interests—that the Port Authority was ready to champion regional programs which New Jersey held in high priority despite resistance across the River.54

Favoritism, Patronage, and the Veto Power The Port Authority’s forays into rail freight and passenger transit generated some political heat, but no real accomplishments. Meanwhile, the agency became the object of thoughtful attention by those who viewed public construction projects as a convenient way to line their own pockets and as a source of patronage jobs for their friends and the party faithful. This perception of government was honored with long tradition in New York City and nearby cities—extending back to the days of Boss Tweed and beyond. It was a tradition that Julius Henry Cohen had long opposed—in his early work with reform groups in New York, and in his design for the Port Authority, which he hoped would be effectively insulated from patronage and other forms of special dealing.55

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The capacity of Cohen’s agency to withstand the pressures of favoritism depended, however, on the willingness of governors to appoint “men of integrity” as commissioners of the Port agency. (There were no women on the Port Authority board until the 1970s.) And it depended on how the governors used the veto power; if the veto became a route to forcing patronage and special construction deals upon the Port Authority, that agency would soon find its public reputation, and the quality of its staff, sadly eroded—a fate which would befall many public authorities in later decades. Moreover, the governors and the board of commissioners would have to resist incursions from the legislative branch; in Trenton and Albany were legislators who cared little about the urban-development goals of the Port Authority and its supporters, and who cared a great deal about contracts and jobs that would help their friends and themselves.56 We have already had a glimpse—in the battles in early 1927 regarding the State House Commission—of the political pressures that might be activated by government contracts, and of the strategies the Port Authority might use to rebuff those efforts. As that conflict suggests, during the Port Authority’s early years the governors of both states selected commissioners who valued regional development and “business-like efficiency,” and whose political interests were not determined by Tammany Hall or Frank Hague. Businessmen all, with two exceptions, and with reputations for personal integrity to protect, they were inclined to adopt the sort of independent stance—even toward the governors who appointed them—that had been one of Cohen’s aims in designing the new institution.57 Those early appointments were not entirely free from problems, and the behavior of one of Al Smith’s appointees, Otto Shulhof, generated a near scandal. Shulhof was appointed by Governor Smith in 1924 to succeed Eugenius Outerbridge, who retired because of the demands of his other work.58 Smith apparently acted without consulting Cohen, or Belle Moskowitz, his chief adviser on Port Authority issues. Cohen had become familiar with Shulhof during Cohen’s work with the garment industry and held him in low regard; “he was known throughout the industry,” Cohen later commented, “for his consistent and steadfast devotion to his own interest.” Cohen conferred with the governor, expressing his sense that the appointment hurt the Port Authority’s reputation. Smith responded by filling the next vacancy with a prominent banker who had no political connections; this “almost instantly erased the stain” of the Shulhof choice, in Cohen’s view. From the sidelines, Outerbridge wrote to Smith, urging him to select men of only the “highest standard” for appointment to the Port Authority. Then, early in 1927, it

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seemed clear that speculators were buying land near the Manhattan terminus of the Hudson River Bridge based on confidential Authority documents; evidence indicated that Shulhof was involved, and Smith quietly forced him to resign.59 Meanwhile, the Port Authority issued its first bonds, to help finance construction of its Staten Island and Hudson River bridges; and the bonds were quickly sold. This success, coupled with the Shulhof episode, offered Cohen a valuable opportunity to issue a reminder—to the governors and the wider public—of the need to keep the Port Authority free from favoritism and other forms of narrow politics. “To borrow money” in order to carry out the Port Authority’s projects, Cohen argued, requires “public confidence in the integrity and efficiency of the men in the institution.” To maintain this confidence, the governors must choose as commissioners those who “primarily consider port and transportation problems from the point of view of their economic soundness,” and they in turn must select a staff based on their “expert qualifications” in engineering, administration, and other fields. Those were just the standards that had been used and should continue to be used at the Port Authority, Cohen emphasized, in order to show “whether or not government can do things efficiently. It can do so if it will trust governmental powers to men who will apply the same standards of efficiency to the public’s work that they would apply in private business.”60 The message was not lost on Al Smith, or on Harry Moore; their other appointments to the board appeared to meet Cohen’s high standard. It would be going too far, however, to conclude that Moore, steeped in the Hague tradition of patronage and favoritism, was able to view the Port Authority as entirely outside his political reach. Among lower staff, Moore occasionally sought places for friends and political associates; and the Port agency was willing to cooperate at this level, while they stressed “expert qualifications” as the crucial factor in appointments to senior positions.61 Once the State House Commission fracas of 1927 was concluded, Governor Moore refrained from using his new veto power to shape Authority policies or appointments to the staff. His successor, however, seemed ready to employ that lever to bend the bi-state agency to his will. Soon after Morgan Larson took office in January 1929, he temporarily blocked construction of the Manhattan freight terminal. Given his expressed support for the revived lighterage case, it seemed likely that Larson would in time use the veto to block the Port agency’s joint regional ventures. Anticipating that prospect, Cohen began to lay the groundwork for defending the Port Authority’s independence. In a confidential memorandum to

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the senior staff and commissioners, Cohen raised the question, Does the governor’s veto power extend—as the language of the 1927 statutes seems to say— to “any action” taken by commissioners from his state, or is it a highly restricted power? Cohen concluded that the veto power was sharply limited in scope: “the Governor may veto the action of a particular Commissioner . . . because of malfeasance or misfeasance, but . . . he may not for any other reason veto the action of any . . . Commissioner taken in pursuance to . . . the powers granted to the Port Authority under the Compact.” So the governor would have the right to intervene only when the board member has committed fraud or “when he has in some other manner violated his duty.” To interpret the veto power more broadly, Cohen argued, would be to permit one governor to block action to carry out that “carefully defined plan” approved by both states—the Comprehensive Plan. Here Cohen staked out an advanced position, asserting that his agency could disregard any gubernatorial effort to use the veto in order to alter the Port Authority’s policy decisions or its ongoing programs; the Comprehensive Plan and other jointly approved legislation would provide a stalwart shield to protect the agency’s autonomy against such interference. When Cohen first expressed these views, in 1929, he was educating the commissioners regarding the challenge they might face from Larson or a later state executive. It was a position that would not be tested for another decade, when the Port Authority would face its first gubernatorial veto—and then back away from Cohen’s aggressive stance for independence.62

“They May Think the Time Has Come for Vengeance” At the beginning of 1929, the Port Authority lost its greatest champion, as Al Smith left the governor’s chair; and that departure set the stage for the decade’s final and perhaps most crucial battle. Since 1918, when he had first considered Cohen’s plan for a cooperative bi-state agency, Smith had been a fervent advocate of the general idea and then of the young institution. In the past ten years, Smith had been governor of New York State for all but two, and during those two years he had been a commissioner of the Port Authority. At Albany and in the Port District he had negotiated with Republican legislators, battled Mayor Hylan, and worked with four governors from New Jersey to build and strengthen this “thoroughly modern method” of financing public improvements and coordinating regional development. Having chosen to run for president in the fall of 1928, Smith had bowed out of the gu-

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bernatorial race, and now he would have to leave the executive mansion. His place would be taken by another Democrat who shared Smith’s positive view of the role of government, but who was viewed by some associates as “an essentially frivolous character, . . . too deficient in willpower and serious purpose actually to govern a great state,” and who had barely defeated his Republican opponent.63 When Al Smith turned over the executive reins to Franklin Roosevelt, he also bequeathed to the new governor the need to resolve the long-standing, if often muted, controversy between the Port Authority and the tunnel commissions. Ten years before, Smith had signed the bill that established the New York State tunnel commission, and he had watched it begin its work, jointly with the New Jersey body, to build a vehicular tunnel under the Hudson. Later, he had become a firm champion of the Port agency, with its wide-ranging mandate, as the best instrument for grappling with interstate transport problems. The political bickering that delayed the tunnel commissions, and the fact that his tunnel agency had to tap state tax revenues in order to build the Holland Tunnel, reinforced Smith’s preference for the Port Authority.64 In the summer of 1923, Smith joined forces with his fellow Democrat, Governor Silzer of New Jersey, to argue that all future bridges and tunnels between the two states should be built by the Port Authority, not the tunnel commissions. A few months later, Smith urged that the Holland Tunnel, then partly completed, be transferred to the Port Authority; and in 1924 and 1925, Smith worked with Cohen on a scheme that would allow the Port Authority to divert most of the Holland Tunnel’s anticipated revenues in order to underwrite the Port agency’s bridge-building bonds. Meanwhile, in discussions with the Authority’s commissioners, Cohen pointed to the danger to the agency’s credit rating if the tunnel commissions, or any other body, could construct Hudson River crossings that might siphon off toll revenue from the 179th Street bridge.65 These early efforts to give the Port Authority a dominant position ran into opposition from Republican legislators in both states. The GOP majorities at Albany and Trenton tended to prefer the tunnel commissioners, most of whom were Republicans; and they also favored allowing private corporations to float their own bonds and build vehicular tunnels under the Hudson. For the next several years, that political division held firm, as one joint agency completed the Canal Street tunnel, while the other worked on the 179th Street bridge. Once the Holland Tunnel opened, in November 1927, its builders turned their attention to the possibility of constructing a series of five more tunnels

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under the Hudson River. With traffic during the first year running far above predictions, it was likely that the Holland would reach its capacity by the early 1930s, so the tunnel commissions thought it essential to begin planning promptly for new crossings, in order to avoid heavy congestion around the Holland a few years hence. Moreover, it appeared certain that “profits” from this first crossing could pay for the additional tunnels, which would be built during the next quarter century. At the end of 1928, the tunnel commissioners recommended that the two states empower them to commence the new building program at once. The Port Authority countered by urging instead that it be authorized to construct a series of interstate vehicular tunnels, and Cohen carried a draft statute to Albany.66 The Authority’s counter-proposal provided a stimulus to its critics, who hoped to cut off the expansive reach of that struggling child before it could do more damage. The attack was led by upstate Republicans, who brought a variety of motives to the fray. Some found the Port agency, with its Democratic party stamp, far less appealing than the tunnel commissions; and Roosevelt’s announcement, early in 1929, that he would appoint an inexperienced political aide to the Port Authority board fanned their antagonism. Others thought that profit-making bridges and tunnels should be the province of private operators. And many viewed the Port agency as a “socialistic” enterprise—and as the opening wedge in a campaign to create government bodies that would sponsor water-power projects across New York State, and build public housing, and do other things inconsistent with American capitalism. A Port Authority with its ambitions sharply curtailed might put an end to that sort of thinking; abolition of the bi-state anomaly would be an even more certain antidote.67 In January 1929, the Republican majority in Albany introduced a bill which would authorize the tunnel commissions to go forward with their program. The GOP leadership also contacted their Republican brethren at Trenton, in the hope of developing a joint strategy to abolish the Port Authority and turn over some of its duties to the tunnel commissioners. New York City’s Democratic representatives in the state legislature joined the attack, criticizing the Port agency’s insulation from close accountability, and arguing that its projects were retarding development in Queens and other outlying parts of the city.68 The counterattack on behalf of the Port Authority was led by New York City business leaders who had pressed for its creation ten years earlier and had defended its efforts since, against critics on both sides of the River. The State Chamber of Commerce warned that abolishing the Port agency would

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be harmful to economic development in the region. The Chamber and a dozen other business associations praised the Port Authority for its great bridge projects, which were the result of “the most efficient staff of engineers and experts dealing with transportation and terminal problems ever organized in one body”—and of its ability to resist “political interference in the acquisition of real estate [and] in the letting of contracts.” To these business executives, the use of revenue bonds to finance a large government program, planned and carried out by an independent agency, was now referred to as “the Port Authority method,” not as creeping socialism. It was an approach which gave great weight to the judgment of bond investors in assessing a government agency’s expertise and independence from politics, and which for large projects “should prevail.”69 The New York Times picked up the Port Authority cause, arguing that the Republican plan to abolish the agency was nearly incomprehensible, in view of its great successes in bridge building. The attack from Albany could only be understood, the Times argued, as a belated effort by “the Old Guard” to undermine the record of Al Smith as governor. “They may think,” the Times concluded, that “the time has come for vengeance, if not on him, then on some of the institutions which he cherished.”70 Republican legislators from Manhattan soon broke away from the upstate contingent and introduced a draft statute that Julius Henry Cohen had prepared, giving the Port Authority the power to “construct, operate or lease tunnels for vehicular traffic” under the Hudson. And Governor Roosevelt, resisting the criticism from New York City Democrats, said that he thought the Port Authority “has done a darn good job”—although he said he had yet not made up his own mind on the competing bills. Sounding two themes often associated with Republican philosophy, he suggested that bond financing of the new tunnel via the Port Authority might be preferable (since it would keep the project from being a burden on the taxpayer), and that no action should be taken which might harm the bonds already issued to finance the Port agency’s first four bridges.71 Meanwhile, the anti-Port Authority moves at Albany failed to provoke similar action among Republican legislators at Trenton. Despite Governor Larson’s sometime skepticism, and occasional grumbling from Hudson County, the Port agency’s four bridge projects had generated extensive political support for its work; and its continued efforts to champion rail transit and marine terminals enhanced its reputation in the Garden State. Faced with these obstacles to their anti-Port Authority plans, the Republican leaders in Albany backed away from their efforts to abolish the agency and to put the expanded

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interstate program in the hands of the Holland Tunnel commissioners. However, they were unwilling to support the bill that would have authorized the Port Authority to begin that task. When the state legislature adjourned in the spring of 1929, both bills still languished in committee.72

The Holland Tunnel Captured No further action was taken during the rest of the year, but it became clear that the stand-off between the two agencies could not be allowed to continue. Traffic through the Holland continued to expand rapidly throughout 1929, and it seemed essential to begin another crossing. In the first days of 1930, the tunnel commissioners reported that their staff had carried out extensive engineering and traffic studies, and that they were ready to proceed with a new crossing from New Jersey to 38th Street in Manhattan. This time the Port Authority did not respond with its own proposal. Instead, after consultations with Cohen and the Port Authority board, Governor Roosevelt announced a new approach: Rather than choosing one or the other of these fine agencies, FDR suggested, why not have “a wedding between the two bodies,” permitting a united body to go forward at once with the midtown tunnel?73 A close look at his proposal made it clear that the new agency would be the Port Authority, with its name, its bond-issuing powers, and its wide-ranging mandate intact. Some tunnel commissioners would be added to the Port agency’s board, however, and their staff would be appended to the team headed by Cohen, Ramsey, and Ammann. The merger plan was readily accepted by the Port Authority commissioners; and Governor Larson soon endorsed it and persuaded his GOP legislative majority to accept the scheme. Seeing no viable alternative, the Republican leadership in Albany also endorsed the plan. The New York Times added its voice in support; but it also suggested that the Port Authority be prevented from siphoning off the profits from its vehicular projects to advance its other interests: There has been some apprehension lest the Port Authority, if left to its own devices, use the proceeds . . . to bolster its other port enterprises. Such fears could easily be allayed by setting up a separate bridge and tunnel fund. If at any point in the future it should show a surplus not required for new crossings, it could be devoted to the reduction of tolls on those already in operation.74

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It was just that strategy—the use of bridge-and-tunnel profits to extend the Port Authority into other domains—that Cohen’s successors would propose a decade later, and that the New York Times would then fervently endorse. But in these early years, the imaginative reach of the “Port Authority method” was only a vague goal, not fully understood, except perhaps by Julius Henry Cohen. In the face of the growing enthusiasm for a merger, only the beleaguered tunnel commissioners held out. In early March, they issued a staff report which outlined a tunnel plan that would cost $61 million, well below the Port Authority’s estimate. And they again urged that the two states permit them to go forward alone, using the same financing methods they had employed on the Holland Tunnel. But that would have required New York State to finance its share from tax revenues, which was unattractive to Republicans and Democrats alike in the Depression year of 1930; and New Jersey, which had funded the Holland with a state-wide bond issue, would again need a state-wide referendum, a sure cause of delay. The Port Authority’s ability to float its own bonds and its strong record in completing its bridges under estimated cost—plus Governor Roosevelt’s reluctance to support the tunnelcommission alternative—had already won over wary Republicans in both states, and the new plea gained little support.75 Meanwhile, Cohen and his colleagues added another nail to the tunnel commission’s coffin, warning against any compromise that would leave that body in charge of the Holland, while the Port Authority built a new tunnel nearby. With divided control, they argued, the two organizations might then compete for traffic by lowering tolls; and if that occurred, the ability of both agencies to repay their debts would be endangered.76 These several arguments were persuasive, and by the middle of April, 1930, both states had enacted legislation which turned over operation of the Holland Tunnel to the Port Authority, and which directed the Port agency to study the feasibility of a second tunnel. Several months later, the Port Authority reported that a midtown tube could be constructed without recourse to tax funds; the entire $96 million would be paid for out of the receipts from the Holland. At that point the two states found it easy to take the final step: The bi-state agency was authorized to build the midtown tunnel, and to control the revenues from all the interstate crossings; this approach was justified, said the statute, “in partial effectuation” of that distinguished relic, “the comprehensive plan.” Moreover, the states agreed that they would not authorize any new interstate crossings in the Port District, unless they were also placed under the control of the Port Authority. There was, however, one exception—

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the bridge approved by Congress in 1890, which might at some point be built by Gustav Lindenthal’s North River Bridge Company. And so Lindenthal’s great enterprise was not yet quite dead.77 But the joint commissions that had built the world’s longest underwater tunnel, and grown wealthy on its proceeds, were. In the legislative package which transferred the operation of the Holland Tunnel to the Port Authority, the number of Port commissioners was increased from six to twelve, permitting several tunnel commissioners to be added to the Port Authority, and the New York and New Jersey tunnel agencies were thereupon abolished. So the “wedding” of the two bodies which FDR had proposed turned out to be the funeral of the senior bi-state agency, which was then just over a decade old.78

Triumph Before the Fall As the two states were moving toward embracing the “Port Authority solution” to the problem of bridge and tunnel crossings, the agency also took a significant step in the rail field. In 1930, it reached a firm agreement with the railroads to go forward with the freight terminal at 15th Street in Manhattan, and construction began in the spring of 1931. The gigantic building would not only make freight distribution more efficient, said the Port Authority, it would actually be a break-even proposition: the bottom two floors would handle rail freight packages, and the Port agency would add 14 more floors on top, in order to generate rental income.79 Early in 1931, the Port Authority added to its political credit by announcing that it could now repay a large portion of the advances given by the two states for the interstate crossings, and in March it delivered checks for $25 million to Albany and Trenton. Governor Roosevelt warmly thanked the Port Authority for its timely “gift,” which he said averted a tax increase.80 Three months later, the Port Authority’s chairman announced that the George Washington Bridge would be ready sooner than expected—probably within a few months.81 And so October 1931 was a time of great celebration at the Port Authority and across the metropolis, as the two halves of the region were joined by the elegant structure created in Othmar Ammann’s mind, and then on paper, and now over a great expanse of water. Writing shortly before the span opened, New Jersey’s Governor Larson emphasized a contribution of Ammann’s span that, while no doubt true, might seem to some a reminder of interstate competition rather than a cooperative spirit—the Hudson span as a route to escape: “The verdant hills and valleys of North Jersey will prove a

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veritable paradise to hundreds of families who have heretofore been compelled to live in cramped quarters.” His New York counterpart stressed a theme that was more Progressive than competitive. The bridge was “evidence of what can be accomplished when true efficiency is applied to civic projects . . . a gratifying contrast to the story of delays, procrastinations and endless disappointments which have often been the fate of great public enterprises in the past.” Referring to Ammann as the individual most responsible for the design and rapid completion of this “monument . . . to this motor age,” Governor Roosevelt concluded that “his work marks a new high standard in public service.”82 On October 24, 30,000 citizens of the two states gathered at Fort Lee and Washington Heights for the formal dedication ceremonies. Governors Larson and Roosevelt again extolled the staff and commissioners of the Port Authority, and FDR stressed a theme that he would later attempt to apply on the national scene: “Their methods are charting the course toward the more able and honorable administration of our nation’s affairs—a course they have proved can be safely steered through political waters with intelligence and integrity at the helm.” At this festive occasion, there were many rounds of applause, the New York Times reported; but “probably the greatest” was that “accorded to Mr. Ammann and Gustav Lindenthal . . . dean of American bridge builders, who came to the grandstand in the same automobile.” So, in an act of generosity, Ammann was reconciled with his mentor, from whom he had departed in despair more than eight years earlier.83 The sunny weather which enveloped the Port of New York Authority did not end in October of 1931. Three weeks later, its Bayonne Bridge was opened to vehicular traffic, again to widespread acclaim; and at the close of the year, the bi-state agency reported that it was in “a stronger position financially than it has ever enjoyed.” But the storm clouds were gathering: Traffic across the Goethals and Outerbridge crossings declined in 1931, as a result of the Depression, and revenues were barely sufficient to meet the annual expenses of the two bridges. Meanwhile, the two states approved the midtown tunnel in the spring of 1931, but the bond market had weakened, so the Port Authority decided not to issue bonds or begin construction until economic conditions improved, hopefully in 1932. Fortunately the revenues from the Holland Tunnel continued to expand, more than meeting the costs of the agency’s other projects.84 Within a few months, however, the Great Depression would unleash a chilling rain on the Port Authority and all its expansive hopes—for a thriving

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system of inland freight terminals, for modern piers at Jersey City, Hoboken, and Jamaica Bay, and for more vehicular tunnels under the Hudson, as well as improved rail transit and those fabled railroad belt lines. It was a rain that would last for ten long years.

The Construction and Dangers of Myth A myth is . . . a set of missions and aspirations that guide a bureaucracy and give it legitimacy. . . . Myths bind the members of the organization together, give them direction, and foster external support. —Erwin C. Hargrove85

In any society which maintains contested elections and other ingredients of democracy, its government agencies will face recurring demands that they be “accountable to the people” and “responsive to individual citizen needs.” The citizenry will make other demands as well—that public agencies take vigorous action to solve social problems, for example, and that government programs be conducted “efficiently.” As Herbert Kaufman has shown, these various goals will often be in conflict, and one set may dominate in one era, to be supplanted some years later by another.86 The Port Authority was born in an era when political insulation, coupled with the use of experts, was a lively—if contested—strategy in designing public programs. Progressive impulses permitted Cohen and his allies to create a regional enterprise, outside the ready control of traditional municipal and state electorates, and to provide it with a mandate to improve efficiency in transport; yet the new agency was given very modest tools with which to carry out its mission. It could gather a coterie of planning experts and engineers, and they could sketch out paper plans to modernize the region’s transportation system and so strengthen the economy of the metropolis. And so they did; and the Port Authority was soon viewed as objective planner, whose ideas held a crucial key to the region’s economic future. But could it do more? Could it take effective action to reorganize the complex and inefficient freight system of the region? Perhaps—if it had been provided with some coercive power. At its creation, however, state officials stripped away the elements of coercion Cohen had sewn into the fabric of the draft charter; and though the bi-state agency pleaded for several years thereafter for subpoena power and other useful teeth to apply to railroad flanks, none were supplied. Nor did the ICC provide the missing

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goad through the collaborative efforts that Cohen sought; in the Harding/ Coolidge era, that national agency was reluctant to tie its future to a vigorous campaign, led by Cohen’s reformers, which seemed antagonistic to the “rights of private enterprise.” As we have seen in chapters 4 and 5, the promise of the Port agency’s rhetoric could not, under these conditions, be converted into effective action. Yet the Port Authority still flew the banner of Progressive efficiency and might draw some comfort from its waving. For the banner had two distinct sides, each of complex design. The first was “regional efficiency,” with its emphasis on outcomes—on better transportation and terminal systems. Initially the agency concentrated on the Comprehensive Plan, with its concern for improving railroad and marine-terminal efficiency via a scheme of rail belt lines and tunnels, capped by freight terminals to improve local efficiency in distributing goods. However, when Ammann and Silzer challenged the bistate agency to expand its domain, and include major vehicular projects, the basic source of legitimate action—though little acknowledged by the Authority—was the original Compact, which captured a wider vision of ways to improve regional efficiency and was far more open-ended than the Plan. The Compact provided the perspective that would later be given wide employment as the agency expanded into airports, bus stations and truck terminals. The second part of this Progressive banner was focused on the “efficiency of means”—on the design of institutions whose officials would have the incentives and capacity to think creatively about ways to achieve regional or outcome efficiency. This side of efficiency, as seen in the Port Authority, had two facets. First, there was the formal design of the institution: its commissioners were appointed for fixed and overlapping terms, in order to mute the impact of electoral politics and partisan conflict on the agency’s leadership and to encourage its members to think in long-range terms. Of course the governor’s veto power might pierce this shield, so it was not surprising that Cohen, the Port commissioners, and even Al Smith resisted that measure in the late 1920s. The Port agency was also insulated from the complexities of politics through its distinctive method of raising funds. In contrast to most government agencies, the Port Authority could not depend upon tax revenues to undergird its programs; it would have to rely almost entirely on floating bonds to be repaid from its projected earnings. Therefore the agency would face the scrutiny of potential bondholders, and this scrutiny would generate a continuing pressure toward “integrity and efficiency” in the agency’s programs; that was the hope of Cohen and his colleagues, and to some extent, as the battles of the late 1920s suggest, it was a hope realized.87

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Moreover, if bonds could be sold based on predicted future performance, a stable flow of funds might be expected, and this stability would aid careful planning and efficient action in carrying out complex projects. Thus the Port Authority’s capacity to float its own bonds gave Ammann a great advantage in the 1920s, in striking contrast to the financial uncertainties that plagued the Holland Tunnel builders. Because the Port agency was identified from its early years with efficiency—efficiency of outcomes and of means—it attracted skilled engineers and planners and lawyers, who thought this was a place they could ply their trades without “extraneous” (political) interference. The same banner of efficiency then led the agency’s commissioners, despite their political roots and connections, to keep “hands off”—to allow the experts they had hired to follow their own professional strategies for action; and at times, as we have seen in chapters 6 and 7, this led to interesting elements of administrative and engineering creativity. So there was much reality in the view that the Port Authority was an exemplar of a major Progressive theme—that governmental action should be based on careful analysis by experts, and directed toward the efficient achievement of programs which would have long-term social benefits. In an important sense, however, this theme was also myth. Not in the sense that it was fanciful or false. Rather, it was mythical as the term is used by Selznick and Hargrove; it provided “a set of missions and aspirations” that could shape the common understanding of the organization’s members and inspire them to greater achievement; and that could also encourage citizens, interest groups, and public officials to offer aid and comfort to this Progressive champion as it sought the region’s greater glory.88 And with these apparent strengths came some important dangers. On the positive side, the Comprehensive Plan provided a sense of coherent purpose, which shaped the efforts of the Port Authority’s early engineers and planners and educated the commissioners to think in long-range terms throughout the 1920s. As noted in chapter 4, the Plan did have some elements of a pork barrel—rail spurs here and there to gain local support, without a sense of ordered priorities. Yet it offered a distinctive vision, based on analysis by experts, of how the region’s economy might be made more efficient and more vigorous. On the negative side, the Plan and its implicit imperative—that the railroads must be persuaded or forced to cooperate—seem to have become an ideological stance to Cohen and his associates, rather than a provisional strategy for economic growth. As the discussion in chapters 4 and 5 suggests, the

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Port Authority’s leaders were so committed to the assumptions underlying the 1921 Plan that they failed to understand the depth of the railroads’ commitment to their own familiar world—a world oriented toward attracting and holding freight shippers in competition with other rail corporations, in the hope your own railroad would thereby maximize traffic and profits. So it was that the Port agency badly underestimated the difficulty of imposing Cohen’s “public utility” concept on rail executives who had grown up in that quasicompetitive world.89 Once the Port Authority had been persuaded to add motor-vehicle projects to its slate, its commitment to the myth (and mission) of regional and procedural efficiency proved to be of real benefit. It seemed evident that the new bridges would make travel across the region more efficient. To achieve that goal, the commissioners and senior staff were willing to give the engineers much room to maneuver; and we have seen that the commissioners were also willing to fend off politicians and professional kibitzers whose demands would have caused delay—and might have yielded the Port Authority only a weak reputation as mere replica of the slow-moving tunnel agency. Shielded by this high-level team of in-house Progressives, Ammann and his aides were able to organize their tasks with some confidence that Moore, Strauss, and others who battered at the gates would not interfere with staff judgments; and the engineering staff could then experiment with new technical methods and with innovative ways of organizing their tasks, and so achieve stunning levels of efficiency—as measured by speed, cost and quality of results—in completing the four bridge projects. It would not be accurate, however, to describe Ammann’s leadership during the six-year effort to build these bridges as a simple application of principles of efficiency. His activities involved a more complex dynamic: In their public statements, the Port Authority’s commissioners and top executives emphasized that their construction efforts must adhere to the banner of efficiency; and this rhetoric served as a shield, partially emancipating Ammann and his top aides from the need to divert their efforts in order to grapple with sporadic political pressures. As a result, they were able to devote their energies to leading their technical staff and contractors, and to encouraging them to meet the challenges of construction in innovative ways. That creative effort broadened the texture of the Progressive myth, converting it from a simple focus on efficient ways of utilizing men and materials to a set of aspirations that could capture and hold staff loyalty over a period of years. A similar broadening would occur in the 1940s and 1950s under Austin Tobin and his senior staff.

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These experiences raise some doubt that Philip Selznick is accurate in denying the stamp of creative leadership to those who work in organizations with “narrow, practical aims.” The “Ammann Bridge” was a narrow and practical goal; yet the administrative methods used by its builder probably rank with the best examples of creative leadership as this theme has been articulated by Selznick, Peter Drucker, and others.90 Following Pendleton Herring, one may say that the Port Authority’s partial insulation allowed the agency to take the “positive political action” needed to overcome the “chaos” of varied and conflicting schemes that had been put forward to solve the problem of regional traffic congestion. Its insulation—a partial reality reinforced by myth—did carry with it the danger that the agency would be viewed as too isolated, as arrogant, as a “superstate” outside the legitimate traditions of a democratic society. On occasion during the 1920s, as we have seen, this was the complaint of New Jersey’s governors, state legislators at Albany and Trenton, and some local leaders. More objective observers have also seen a touch of arrogance in Port Authority behavior during that era; for example, the agency’s sharp criticism of the Committee on the Regional Plan, when the leaders of that distinguished group endorsed the Narrows Tunnel, might justify the charge. That criticism would seem more persuasive three decades later, however, when the Port agency, despite widespread criticism, constructed the World Trade Center and fought for years to spread a gigantic airport across northern New Jersey.91 Finally, the Port Authority’s emphasis on expert analysis and efficient action carried with it the danger that it would give too great emphasis to the views and needs of bondholders, who (as Cohen pointed out) provided an external test that the agency’s work was achieving high standards of “integrity and efficiency.” The bondholders and their bankers held a narrow perspective, focused on protecting the security of their investments. To use that view as the standard for achievement, as Cohen at times appeared to, would limit and probably cripple the Port agency’s contribution to regional development. In fact, within a year or two that “banker’s mentality” would dominate the bistate agency, and in the dark period of the Depression, the Progressive myth seemed almost to disappear, though it continued to be nourished in the byways and corridors of the agency. From these byways, in the 1940s, some broader possibilities for regional action would then emerge.

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Part Three

Drift and the Sources of Renewal

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8 Near Bankruptcy and the Loss of Vision

One has the feeling of going it blindly . . . because we’re in a tremendous stream, and none of us knows where we’re going to land. —Eleanor Roosevelt, March 19331

Construction work remaining uncompleted but which is not absolutely necessary has been deferred. . . . During the year a total of 235 positions have been abolished. . . . Conditions beyond the control of the Port Authority necessitated the derangement of an organization which had taken so many years in its formation. —Commissioners of the Port of New York Authority, March 1, 19332

T

he enviable reputation the Port Authority had achieved by the fall of 1931 was not lost in a day, or in a year. Indeed, one might argue that it was not lost at all during the Depression years, as close observers regularly praised the agency for its wide-ranging activities and successful projects. Archibald Macleish wrote admiringly of the Port Authority’s efforts to overcome the region’s railroad and shipping problems; he thought it “one of the most interesting and potentially one of the most formidable political agencies America has yet produced.” The New York Times commended the Authority for its “immense program of bridge building and tunnel digging” and its “fiscal prowess.” In the late 1930s, the governors of both states applauded the agency for its accomplishments—which matched “our highest standard of industrial efficiency”—and for its efforts to champion cooperative action to end “petty rivalries and narrow sectionalism.” At the end of the decade, Mayor Fiorello LaGuardia, once a vigorous critic of the agency’s efforts, surveyed its work through the 1930s and extolled the Port Authority for its “splendid record of achievement.”3 The reality, however, was quite different. Whether measured by new projects undertaken and completed, by its financial strength, or by the vision 181

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of its leaders, the Port Authority’s performance in the decade following completion of the George Washington Bridge fell far short of the hopes expressed at its dedication in 1931. Perhaps the applause visited on the agency during the next ten years was deserved—but mainly as acknowledgement that the projects finished in its first decade were continuing to yield valued fruit. In its second decade, the Port Authority skirted close to bankruptcy, Ammann’s famous engineering department was nearly abolished and its leader departed, and the agency devoted much of its political effort to fending off attacks from hostile elements in New Jersey and in the Roosevelt Administration. Despite the praise from the New York Times and others, by 1941–42 its closest sympathetic observer could conclude with good reason that the agency’s activities had become “totally receptive rather than aggressive,” and its energies were devoted mainly to monitoring traffic and “collecting tolls to pay off its debt.”4 A major factor in this malaise was the Great Depression; as Eleanor Roosevelt’s comment suggests, it was difficult to explore new ideas and programs when the economy was in chaos. However, energetic and imaginative public officials could still find interesting and useful strategies for action, as Fiorello LaGuardia and Robert Moses demonstrated during these same years. So the Port agency’s weaker record in the 1930s was the result of a mixture of external forces and its own leadership, constraints, and policy choices. The first task of Part Three is to analyze the problems the Port Authority encountered and the responses of its top officials during the years from 1931 to 1942, and chapter 8 is devoted to that set of concerns. The larger task, which occupies the next two chapters, is to locate and examine the sources of the Port Authority’s later revitalization. After 1942 the bistate agency would emerge as a major political and economic force, in the New York region and nationally, with an agenda far broader than the bridgeand-tunnel focus of its first two decades. An important reason for that metamorphosis is found in the organization’s quasi-bureaucratic character, for it had begun life as a loose aggregation of specialists, and the attempts to centralize control had succeeded only partially. In the counsel’s office in particular, a sense of intellectual play was permitted by the division’s leadership throughout the 1930s, and the assaults which private corporations and the Roosevelt Administration directed at the Port Authority challenged staff members to stretch their minds, so that they could devise complex legal and political strategies in response. By 1942 the battleground was strewn with old legal doctrines and new cases; and a national coalition, led by an entrepreneurial team of Port Authority lawyers, had defeated FDR’s attempt to strip

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tax exemption from state and local bonds. Meanwhile, a few planners tucked away in the agency’s catacombs had begun to think expansively about the agency’s future role, and in 1940–41 they sketched out ideas for new projects that could augment the agency’s modest reach. In chapters 9 and 10, we explore the mixture of bureaucratic traditions, strategic opportunities, and individual skill and passion which made the 1930s a period of renewal as well as decay at the Port Authority. And which set the stage, by the summer of 1942, for the Port Authority to enter new domains, and for the battles we will examine in later chapters.

The Decline and Fall of Many Plans When Ammann’s great bridges were completed in the fall of 1931, the Port Authority looked forward to new opportunities, in the field of motor vehicles and beyond. Early in 1932, the Port Authority reported that it would shortly begin work on a new two-tube vehicular tunnel to midtown Manhattan, and that both tubes would be completed by 1937; it also expressed confidence that traffic demand would continue to increase and identified the locations for three more tunnels and two additional bridges across the Hudson. However, its leaders’ optimistic hopes soon confronted the deadening impact of the Great Depression. Traffic on most of its facilities declined in 1932 and 1933, and the bond market collapsed, compelling the Port agency to apply for a loan from the federal government to begin work on the new tunnel. The loan would permit the Port Authority to construct only a single tube, but that was better than stopping the project altogether, and the agency began digging in the spring of 1934. Ultimately a federal grant of $4.8 million subsidized completion of this first tube of the Lincoln Tunnel, which opened in December 1937.5 Meanwhile, traffic increased in 1936–37 and the Port agency gave the green light to a second tube. Then the 1938 recession struck. It was soon clear that the first tube was piling up a large deficit; and as the Port Authority’s general economic condition weakened, work was indefinitely suspended on the second project. Three years passed before construction was again resumed, early in 1941, and the second tube would not open to traffic until 1945.6

The End of Railroad “Cooperation” Plans for a series of Manhattan freight terminals also entered the 1930s in a spirit of optimism, which was soon eroded, as the railroads retreated to their

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traditional pattern of antipathy. The Port Authority’s original scheme called for nine stations, where freight from all the rail lines would be sorted; it would then be delivered in efficient batches to local stores and factories, thus eliminating thousands of pickups and deliveries by the individual rail carriers. When the railroads resisted in the late 1920s, the plan had been whittled down to three Manhattan terminals, and in 1930 the rail executives had endorsed the Port Authority’s plan to construct the first inland freight terminal at 15th Street. The Authority staff designed a huge 16-story structure, extending from Eighth to Ninth Avenue, with the lower two floors devoted to receiving and sorting railroad freight and the rest of the building available for commercial and industrial rentals. Construction was started in the spring of 1931, and by October 1932 the lower floors were completed and the freight sorting operation was underway. Port Authority officials asserted that the terminal would make the New York region a leader in the efficient handling of freight, and Herbert Lehman, New York’s acting governor while FDR was campaigning for the presidency, viewed the structure as impressive evidence that “unplanned and wasteful competition” was at an end. There is “no finer example of sound and able cooperation between government and private agencies than Inland Terminal No. 1,” he declared. With eight railroads committed to using the new system, the bi-state agency looked forward to taking an important stride in meeting the “efficiency goals” of the Comprehensive Plan. It also expected to generate a brisk rental business on the upper floors, which would help to pay for the freight operations below.7 The new era of cooperation lasted only a few months. By early 1933 it was clear to the Port Authority that the railroads were still relying mainly on their individual delivery stations and trucks; despite their weakened financial condition, the rail lines seemed reluctant to embrace a cooperative system as a way to save money and improve service. The bi-state agency responded by ending the truce they had accepted in the late 1920s. With President Roosevelt and his aides searching for ways to improve the railroad situation, the Port Authority attacked “waste and inefficiency” in the rail industry and joined the growing band of critics who urged that a federal coordinator be named, and given the power to compel the railways to consolidate their terminal operations.8 During the spring, Congress responded by creating the position of Federal Coordinator of Transportation. Roosevelt then appointed a reform-minded member of the ICC, Joseph B. Eastman, to take the post. However, when Eastman urged the railroads to consolidate their terminals in several cities,

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they resisted; and when he tried to order consolidation of competitive terminals, railroad management and labor joined forces in opposition, and in 1936 they persuaded Congress to eliminate Eastman’s position. Even in the Depression, with some of the carriers in bankruptcy, competitive capitalism was alive, if not well, in the American railroad industry.9 Throughout the 1930s, the railroads continued to use the Port Authority terminal for only a small portion of their traffic, and even with the upper floors nearly fully rented, in most years the terminal building barely broke even. In 1939 and 1940, the Port Authority again called attention to “wasteful” railroad practices and urged the rail lines to take steps to unify their terminal operations; otherwise, the agency warned, federal legislation would soon compel them to act. But Washington was always occupied with other matters. The Port Authority’s hopes for an extensive system of rail freight terminals limped into the 1940s on one shaky terminal leg, and the second and third terminals never would be built.10

Financial Decay and the New Bonds The traffic and revenue problems at the inland terminal and the Lincoln Tunnel were part of a pattern of financial deterioration which infected all the Port Authority’s projects except the Holland crossing, and which tended to move its leadership away from a broad concern with regional challenges and toward a narrow focus on its own money problems. Early in 1932 staff salaries were reduced 5–10 percent, and as revenues declined during the year, the agency deferred scheduled construction work, laid off dozens of employees, and announced that all staff members would be ordered to take two weeks extra vacation without pay. Bridge and tunnel traffic dropped still further in 1933, and despite a modest upturn in 1934, the Port Authority faced a clear danger that its reserves would be too depleted to pay off the bonds that were due to mature in 1937 and 1938.11 To overcome this problem, the agency decided to issue new bonds with 35-to-40 year maturities and low interest rates (due to the depressed bond market), and to use these issues to refund the outstanding securities; in 1934 these totaled $152 million. The new “General and Refunding Bonds” would also gather all the Port agency’s debt into a unified reserve, which could then be used to underwrite any authorized project. The refunding program was begun in March 1935, and the agency overcame the immediate crisis. In the long term, however, the Port Authority’s viability would depend on a sharp upturn in vehicular traffic, on new projects which might generate extra rev-

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enue to offset the drain of the Staten Island spans, and perhaps on further grants from federal and state governments.12 The uncertain condition of the Port agency’s finances, combined with the region’s general economic malaise, halted further studies of several projects that had once appeared highly promising. Plans for a modern marine terminal in Jersey City were completed by the end of 1931, with the prospect that construction might soon begin; the following year, the effort was suspended indefinitely. The Port Authority’s proposal to buy and modernize Hoboken’s piers was derailed by a purchase price that exceeded its means. The question of a regional food terminal for the Newark area, carefully studied in 1930–31, was dropped from further consideration as the Depression proceeded. Extensive studies of regional rail-transit needs, begun in 1927 as a joint project of the Port Authority and other public agencies, were suspended late in 1931, and the regional study group never reconvened.13

Patronage and Political Conflict Meanwhile, because the Port Authority was no longer actively engaged in major new projects of visible benefit to the region, the agency became more vulnerable to patronage incursions and political attacks. Like a ship adrift in the harbor, the bi-state vessel became an attractive home for barnacles of various sorts and for salvos launched from unfriendly shores. Throughout the 1930s, the usual trickle of patronage demands continued from both shores of the Hudson. More troubling was the decision of the Port Commissioners to appoint Morgan Larson as “consulting engineer” to the Port Authority, with a substantial salary, shortly after he completed his term as New Jersey’s governor in 1932. Although Larson was a certified engineer, his appointment suggested to some that the agency wanted to curry favor with Larson’s Republican colleagues in the New Jersey legislature, and this impression undercut the Port Authority’s reputation as a nonpolitical enterprise.14 Democrat A. Harry Moore returned as New Jersey’s governor in 1932, and he soon named John Milton to the Authority board; Milton was a close associate of Jersey City mayor Frank Hague, and the appointment suggested that Jersey City’s political machine would now have a direct route to Port Authority jobs. Then, late in 1933, John Galvin, a long-time Port Authority board member and active Tammany Democrat, resigned from the board at the age of 71 and was immediately appointed to the staff at $12,000 a year, one

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of the agency’s highest salaries. Galvin’s title was “Director of Port Development” and he held that post until 1936. The title and salary suggested a position of importance, but port development issues were handled by staff members who did not report to Galvin, and his role was described as “advisory” with unspecified duties.15 The Port Authority also attracted renewed and unwanted attention from those who doubted that its regional projects would help to raise all local “boats.” In 1932, the Queens Borough president attacked the agency’s efforts as mainly beneficial to New Jersey and urged the state legislature to force the Authority to “end, once and for all, the development of another State at the expense of the New York section” of the metropolis. The Brooklyn Chamber of Commerce criticized the Port agency for devoting its energies to vehicular projects that would benefit New Jersey and Manhattan, while neglecting its long-promised tunnel, which would bring the nation’s railroads directly into Brooklyn. And a few months later, the Brooklyn group joined forces with the Queens Chamber of Commerce in opposing construction of the Lincoln Tunnel.16 On the New Jersey side of the Hudson, the bi-state agency came under fire during the 1930s on issues old and new. The most prominent old issue involved the “lighterage problem.” In 1929, as noted in chapter 7, New Jersey officials had revived their dormant campaign against New York City, urging the ICC to force the railroads to charge more to shippers who floated their goods across the Hudson than to those whose goods were destined for factories and ship terminals on the New Jersey side. In 1933, the ICC examiner agreed with the New Jersey position, rejecting the arguments of the Port Authority that freight rates throughout the port should remain unified and dealing the bi-state agency and its New York compatriots a stunning defeat. “Free lighterage has retarded the development of shipping facilities and business on the New Jersey shore,” he concluded, and rail lines that floated goods across the harbor must levy an additional charge for this service. Abandoning their reluctant silence of the Larson years, Port Authority officials joined with New York business leaders in condemning the report. The extra charge, they argued, would cause shippers to divert traffic to Baltimore and other rival ports, not to the undeveloped shorelines of Newark, Jersey City, and Bayonne.17 At this point, the conflict of two decades earlier was sharply revived, as Newark business leaders and state politicians endorsed the examiner’s recommendation. Governor Moore praised the decision, which he thought would “stimulate enormously industrial and commercial development on

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the New Jersey side.” If the full ICC accepted the examiner’s verdict, said the Newark Chamber of Commerce, “hundreds of manufacturing enterprises” would shift their operations from New York to the Garden State. New Jersey leaders also attacked the Port agency for showing favoritism toward New York; it had demonstrated “vicious partisanship” in supporting free lighterage to New York destinations, said the state’s attorney general. The Port Authority then bowed to political pressure and formally withdrew from the case, when it was heard on appeal by the ICC.18 In July 1934, the full Commission reversed the examiner, endorsing free lighterage services as part of an integrated New York port. But this did not quell the competitive fires in New Jersey, and a few years later, Jersey City, Newark, and state officials again urged the ICC to compel the railroads to charge more for deliveries made across the Hudson. During this round, in 1939–40, the Port Authority board decided not to take part, and it was then attacked by Brooklyn officials for failing in its duty to protect the unified port. Once again, the full ICC endorsed free lighterage, and after a quarter century the issue was finally laid to rest.19 A continuing headache throughout the 1930s was the matter of tolls on Port Authority’s bridges and tunnels. The basic rate, when the first transHudson crossings were opened in the late 1920s, was 50 cents for each automobile. In the next few years, there were recurring complaints about the toll level, and by 1937–38 the Port Authority was criticized widely for its “excessive toll barrier” for cars and trucks. These criticisms attracted a strong public following in the northern counties of New Jersey, whose residents traveled frequently to Manhattan to work and shop. “Toll reduction” associations were formed, and motorists were urged to “boycott all Port Authority bridges and tunnels.” The agency’s leaders fought back, vigorously if not always wisely. Chairman Frank Ferguson attacked the groups which demanded toll reductions, accusing them of “malicious propaganda” and arguing that they were publicity-seekers, mainly interested in attracting more members in order to increase their associations’ income. The Port agency would not reduce existing tolls, Ferguson asserted, “regardless of petitions, publicity, personal appearances, or pumped-up pressure.” Another member of the Authority board was equally sensitive to public sentiment, urging New Jersey residents to use “good sense and business judgment” and “cease their irritating agitation for a reduction” in tolls.20 The Ferguson brand of public relations was not likely to soften the antitoll fervor, and in response to growing complaints, the state legislature created a special committee in 1940 to investigate trans-Hudson tolls. The Port Au-

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thority then adopted a more effective strategy. It prepared a 97-page report which opened with praise for state officials who took an active interest in the Port agency’s work. The report then described the agency’s great difficulties in maintaining a sound credit balance during the Depression and argued that any toll reduction in the near future would undermine its ability to pay off its bonds. If toll rates were “subject to political expediency,” the Port Authority concluded, “the credit of the agency would cease to exist.” Moreover, if tolls were reduced very far, the existing debt could only be paid off by “shifting the burden to the taxpayers.”21 Having raised these fears, the Port agency adroitly placed the problem back in the legislature’s court: If the state of New Jersey would allocate funds to provide “adequate arterial highways” to the Lincoln Tunnel, so that more automobiles and trucks could reach that undernourished facility, permitting the second tube to be constructed on a break-even basis, then it might be “prudent” for the Port Authority to consider reducing the toll rate—at some point in the future. The agency’s educational effort won over the special committee, which issued its own report at the end of 1940. The legislators endorsed the Port Authority’s position against immediate reductions in the toll level, and they also urged the state highway department to construct the feeder highways needed to serve the Port Authority’s crossings.22

Agency Adrift Buffeted by all these troubles—weak traffic revenues, railroad noncooperation, and political incursions—the Port Authority found it hard to retain the expansive and optimistic outlook which had stamped its activities in its first decade. Moreover, those who led the agency during the 1930s were disinclined to positive action, and their attitudes dampened whatever fires of change still burned in scattered portions of the staff. The bi-state agency had been fortunate in its first years, attracting venturesome leaders from business and political life—Outerbridge, Gregory, and Silzer—to chair the board. However, these men were succeeded by those with narrower concerns. John Galvin, a Tammany Democrat and a Queens businessman, served as chairman for five years, ending in 1933. The next year, the commissioners elected Frank Ferguson to chair the board, and he remained in that post until 1945. A fiscally conservative banker from Hudson County, Ferguson was actively involved in devising the Port agency’s refunding strategy in 1934–35, and throughout the financial ups and downs of

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the next seven years he held the executive reins and tilted the agency toward a focus on reducing expenditures and paying off the debt. The vice chairman, Howard Cullman, was energetic and a risk-taker; but he did not get along well with Ferguson and was given no executive responsibilities. His most visible activity in the 1930s was his advocacy for the construction and wider use of the inland freight terminal.23 The conservative stance offered by Ferguson was not much moderated by John Ramsey, who was appointed to the top administrative post in the late 1920s and continued as General Manager throughout the 1930s. Ramsey worked closely with Ferguson on the refunding issue and followed the banner of fiscal constraint under the chairman’s leadership. Meanwhile, the staff members who had led the agency’s efforts in the 1920s to think imaginatively about complex port-planning issues, and about modernized piers, regional food terminals, rail transit, and other new projects, were brought under the firm hand of Billings Wilson in the 1930s, as a part of his Development and Operation Department. Wilson, who viewed the efficient operation of the bridges and tunnels as his primary task, ran all his units as elements of a wellorganized quasi-military enterprise, and he was also an enthusiastic member of the cost-cutting team of Ferguson and Ramsey. By the late 1930s, the planning staff, headed by Walter Hedden and labeled the “Bureau of Commerce,” had dwindled to a few men and women. Wilson often marshaled the Bureau’s troops and sent them out to make traffic counts at the bridges and tunnels.24 Much effort was devoted to thinking up ways to generate more traffic; for example, baseball schedules were distributed at the crossings in the hope that they would prompt wary New Jerseyites to venture more often to Yankee Stadium or even as far as the Dodgers’ Ebbetts Field. It was a time to encourage desperate chances. However, the wider planning interests and talents of its staff were not encouraged, and the planners had little influence in agency thinking.25 In the 1920s Othmar Ammann had brought large amounts of entrepreneurial energy to the Port Authority’s tasks, but his impact was diminished in the early 1930s, as the agency’s financial uncertainties weakened prospects for new construction projects; and then Robert Moses captured Ammann’s attention and energies as Moses’ own projects won approval.26 For a time in the early 1930s, Julius Henry Cohen brought a wider perspective and thoughts of new initiatives into central policy councils, but after a heart attack in the mid-1930s, he rested for several hours each workday and largely confined his energies to legal issues confronting the Authority. Cohen had managed to attract into his legal enclave several assistants with imaginative

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energy and a willingness to think in nontraditional ways; but as we will see below, their energies were focused on a range of legal and political challenges which for many years seemed peripheral to the Port agency’s main mission. Not until the 1940s would Port Authority officials, led by Commissioner Howard Cullman and General Manager Ramsey, make the connection between a peripheral “game,” which occupied some of Cohen’s best aides, and the ability of the beleaguered agency to recast its mission and shake loose from the burdens of ten years of drift. With Ferguson taking the leading role in shaping Port Authority policies from 1934 onward, it is not surprising that the staff moved warily in exploring new lines of activity for the bi-state agency. In 1936, the New Jersey legislature asked the Authority to study once again the prospects for improved rail transit between New Jersey and New York City. The agency did so and submitted a report, but it concluded that the Port agency itself could take no responsibility for improving the transit situation because any improvements would generate deficits. Urged to study the prospects for international commercial aviation in the New York region, the Port Authority completed a detailed analysis in 1937 which found that “overseas air transport” would soon become “a commercial reality,” but that airports operating “on a self-supporting basis will be extremely unlikely.” Therefore, the Authority concluded, “such projects are not suitable as Port Authority financial undertakings.”27 Studies of marine terminals in Jersey City, Hoboken, and Brooklyn, once viewed as important to economic development in the region, were not pursued after 1932. Surveys of possible new projects—for a series of union truck terminals and for some solution to the problem of bus congestion—were begun in the late 1930s at the urging of New York City officials and others, but they did not in those years generate much staff enthusiasm.28 So the Port Authority seemed to wander through the decade, buffeted by the winds of economics and politics, its own wary leaders steering only fitfully. And even when traffic and net revenues turned sharply upward, as they did in 1939, 1940, and 1941, the bi-state agency held to the vision captured by a prominent heading in its Annual Report for 1940: The Debt Must Be Repaid.

9 Federalism as a Lawyers’ Playground

You moonshine revellers, and shades of night, You orphan heirs of fixed destiny, Attend your office and your quality. —Shakespeare, Merry Wives of Windsor, V,vi

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o part of the Port Authority was entirely immune to the malaise of the 1930s. By virtue of its special tasks, however, combined with the incurable optimism of its chief, the Law Department was less prone to infection than most branches of this weakened body. The peculiar place this bistate agency occupied in the American federal system generated continuous legal challenges; and these challenges, together with Julius Henry Cohen’s reputation as a creative thinker, attracted and held able young lawyers who had a taste for battle and a readiness to play the legal game under his shrewd tutelage.1 Cohen and his team hoped to use the legerdemain of the law to ensure that the works of this governmental enterprise were placed on a sound legal footing, despite the opposition of those—a melange of private real estate interests, local government officials, and the U. S. Treasury’s thirsty tax agents—who sought to shackle the agency. But these legal efforts could also serve further purposes, not fully intended or perhaps even fully understood by Cohen and the agency’s executives—encouraging staff members to think imaginatively about ways of using the powers of government; and providing them also with opportunities to act on their imaginings, as they learned how to build political coalitions across the region and across the nation, as a route to achieving their preferred legal and policy goals.

The Protection of Precarious Values A crucial problem facing any organization is the safeguarding and nourishment of its “distinctive values, competence, and role”—and particularly of 192

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those core values that may be lost when the organization’s financial strength deteriorates, or because of jealousies among competing divisions inside the organization and beyond. At the Port Authority, imaginative thinking in matters of engineering and the law had been central to its early life, and the capacity of its champions to think regionally and to build political alliances had been equally important to its creation and during its first decade. Cohen and Ammann had shown exceptional abilities across these realms. As we have seen, the experience of lively challenge and creative, successful response was lost in much of the agency’s offices during the 1930s. In resisting the general malaise, the Law Department was able to safeguard the distinctive values that had made the Port Authority a leader in the field of public enterprise; thus it could serve as an incubator for the kind of entrepreneurial leadership that the Authority would need once the dreary days of the Depression were at an end.2 Yet “incubator” does not provide quite the right image. In the 1930s the legal terrain became a sort of playing field, which permitted those with a taste for combat and an eye on creative possibilities to develop and test their political skills and their leadership capacities. On this testing ground, the Port Authority’s real-estate attorney, Austin Tobin, emerged from the lower ranks of the agency to fight wider legal battles and then marshal a national coalition to oppose the taxing plans of Franklin Roosevelt. By 1942, the majority of the Port Authority’s board was convinced that the veteran of these wars should lead the Port agency into the postwar world; and that conviction set the long-term course for the agency, which would remain under Tobin’s direction for the next thirty years. To understand how Tobin used the legal challenges of the 1930s to vault into a position of major influence, and what values and skills he then brought to the top post at the beginning of the 1940s, we need to proceed through several stages. First, we will examine Tobin’s early history, before he joined the Port Authority in 1927; for his family life and college experiences, in Brooklyn and at Holy Cross, would shape his interests and reveal the passion for inventive play and the organizing talents that he would later use at the Port Authority. Then we will follow the steps by which Tobin moved himself from the periphery of the Port Authority’s concerns to a central position. His strategies during these years (1927–1938) again show a creative mind at work, coupled with a strong dose of playful contrariness. Finally, in chapter 10, we will explore the strategies used by Tobin and his associates to challenge FDR and his Congressional allies on the issue of taxing municipal bonds. This was a campaign that began in 1938 and was still continuing in 1942, when a sharply divided board chose Tobin to be executive director of the agency.

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A Son of Brooklyn and the Church In these artificial days, there are only a few compelling people who become so sincerely bound up in every task to which they are assigned, that they positively fill the atmosphere with their determination. Austin is of that rare and valued type. . . . —Holy Cross College yearbook, 1925

Politics and the docks of New York harbor were part of the heritage of the Tobin family, which in the late nineteenth century made its home near Prospect Park in Brooklyn. Austin’s grandfather, who had emigrated from Ireland, worked at the Brooklyn docks while the great bridge was under construction. Killed in a dock accident at the age of 30, he left a son, Clarence, and a daughter. To help support the family, young Clarence became a messenger boy, but he soon caught the eye of a member of the Brooklyn Democratic organization, who urged him to “go to school; become a stenographer.” And so he did; and through his political connections Clarence gained appointment, beginning in 1901, as stenographer to local public officials. In 1907 he was named to the staff of the state trial court in Brooklyn, where he served as court stenographer for 42 years, until his retirement in 1949.3 In 1902 Clarence married Katharine Moran, whose family was in the funeral business in Brooklyn, and they had four sons. Austin Joseph was the first. Born on May 25, 1903, Austin received an education that was in a formal sense thoroughly Catholic but, when mixed with Tobin’s personal chemistry, was also thoroughly emancipating. Austin attended the parochial school of St. Francis of Assisi Roman Catholic Church, and he then entered St. John’s Catholic preparatory school, graduating in 1921. His next four years were spent at Holy Cross College in Worcester, Massachusetts, from which he graduated near the top of his class in 1925. Later that year he began the study of law at Fordham. Holy Cross was, a college classmate of Tobin’s recalls, a “very rigid Catholic school.” Austin liked parties and he was not averse to a little drinking and gambling; so he sometimes broke college rules, and he accumulated a large number of demerits in his four years at school. At times, he seemed to relish the challenge of breaking the rules, as he worked out complex strategies to defeat the college’s efforts to monitor student behavior.4 But his challenge to authority was more intellectual than social. Tobin loved reading, and he was a highly rational being (“as his Jesuit teachers had taught him to be,” one friend commented). And he was stubborn; once Austin had thoroughly explored a question and reached a clear position, he

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was unyielding. When he discovered that some of his class assignments were excerpts and that he was forbidden by the Catholic Index to read other parts of great works, he argued with his teachers, and the arguments were sometimes heated.5 And when he pursued the assumptions of his religion with teachers and fellow students, as well as introspectively, he found that he could no longer make the needed leap of faith. Austin broke with the Church during his college years, and he was steadfast in refusing to take part in Catholic services during the next four decades. Although he left the Church, Tobin’s intellectual development showed clear marks of his Jesuit training. Not only was he highly rational, he also loved classical literature and the rhythm of language, and these loves were encouraged by his teachers and his fellow students. At St. John’s Prep, he won awards for oratory, and sixty years later, high school companions could still recall the subjects on which he spoke.6 At college he walked with friends on the campus hills, reciting Virgil and Horace, and debating with them the great and small issues of the day. And he could write; this talent too was encouraged by Holy Cross, where Austin penned essays and poems for the literary magazine. Like the poet Hart Crane, Tobin was touched by the romance of the harbor and the sometimes destructive intensity of the growing cities.7 Tobin’s most distinctive qualities during these years were great personal energy, organizing talent, and commitment to a cause, combined with a playful, risk-taking approach to life. The first three of these attributes are illustrated by his fervent support of the football team and other athletic endeavors, and by his leading efforts in organizing college dances in the New York area.8 These dimensions are also captured in his yearbook entry, whose opening lines are quoted in the headnote to this section. The yearbook comment continues: “No half-way measures for him; do it well, or don’t do it at all—with a vengeance. In fact, we would be inclined to smile at his earnestness, if he had not a wealth of genuine talent to justify his actions.” These sentences capture not only the Tobin of four years at Holy Cross but important elements of his next four decades as well. The playful and risk-taking aspects of Tobin’s character were also on display in much of his college life. Both elements are seen in the stratagems he devised to outwit the watchful Jesuit monitors, and in his enthusiastic response to gambling opportunities.9 However, the playful side of his personality was most clearly displayed in his half-time activities during football games and in related capers. For one football game during his senior year, he organized and produced a half-time show which parodied British royalty.

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(Austin assigned himself the role of “Lady Mountbatten or Lady Somebody.”) For the Fordham game, he organized a burlesque Spanish dance, and for the St. John’s game, he and other upperclassman planned a half-time entertainment in which “fifty innocent freshmen” were introduced onto the field and asked to capture two well greased pigs. During November of his senior year, Tobin wrote “insane snatches of verse” for the New Jersey Club dance; and he and a compatriot put on a skit for the Freshman Reception.10 After graduation in 1925, Austin returned to Brooklyn and married Geraldine T. Farley, who had graduated from Adelphi College the same year. That fall he enrolled at Fordham Law School, attending classes in the evening while working as a clerk at Miller & Otis, a New York law firm, and casting about for what he should do next. His father was active in Brooklyn politics, but Austin had no interest in that field. He visited the local Democratic club with his father once or twice, but he felt uncomfortable in the society of party members who kept their hats on indoors and chewed cigars, while they exchanged news about local political issues and devised strategies for the next campaign.11 Although Tobin was reluctant to throw his energies into local politics, his view of government was highly positive. Like his father, Austin held Woodrow Wilson in high regard, and this favorable view had been reinforced by a brief meeting with the president at the White House.12 In the tradition of Wilson, Theodore Roosevelt, and young Robert Moses, Austin viewed government as an appropriate instrument in meeting broad social goals, he favored a strong civil service along British lines, and he was optimistic that American society, effectively led, could meet the challenges ahead.13 One of the newest experiments in active government was the Port of New York Authority. Tobin had heard about the “port authority idea” in 1919–20, when Governor Alfred E. Smith campaigned across the region for the creation of the bi-state agency. As Tobin later recalled: “My father . . . took me to hear Al Smith make the closing speech of one of his campaigns in the [Brooklyn] Academy of Music, and it was there that I first heard about the idea and concept of the Port Authority.”14 In 1925–26 the Authority was still negotiating with the railroads, but it had just received approval to construct three bridges between New Jersey and Staten Island, as well as the vast span across the Hudson River. Ground-breaking ceremonies for the first of these projects took place in September 1926 with much publicity, and the future of this fledgling bi-state enterprise looked promising. Moreover its General Counsel, Julius Henry Cohen, had a national reputation for his innovative approach to important legal and substantive problems.

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Here was a natural place for an aspiring lawyer interested in the New York region and in complex legal issues. In 1926, a friend of Tobin at Miller & Otis, John Stuart Dudley, was hired by the Port Authority as a real estate attorney, and he soon urged his compatriot to join him. Austin applied for a position, and Cohen liked what he saw. A demand that the position be used to meet patronage needs postponed a decision temporarily, but Cohen resisted that foray. On February 14, 1927, Tobin joined the Port Authority’s small staff as a law clerk. A year later he had his Fordham law degree and was promoted to Assistant Attorney in Cohen’s office.15

The Rise of a Real Estate Lawyer If it wasn’t nailed down, he would grab it. —A colleague, reflecting on Tobin’s activities in the Law Department

Although there is some risk of oversimplification, it would not be far wrong to say that in the 1930s the Port Authority and Austin Tobin were on divergent trajectories—the Authority slipping slowly downward, Tobin spreading his wings, moving up. For the Port Authority, as we have seen, the decade opened with great achievement and much promise. In 1930–32, the agency completed the Bayonne and George Washington bridges, took control of the Holland Tunnel with its lucrative toll revenues, built the “first of nine” inland freight buildings in Manhattan, and began plans to construct the Lincoln Tunnel and to modernize the region’s shipping terminals. As the Depression took its toll on revenues, the Lincoln project was cut in half, and an array of other plans was shelved. By the end of the decade, the main goal of the agency was simply to retire its debt as quickly as possible. Its policy had become essentially passive; the sense of vision and imaginative action seen in the 1920s had departed from the planning division, the engineering force, and the commissioners’ offices.16 In the Port Authority’s law department, however, the atmosphere was not one of prudent investment and caution, but of lively challenge and legal inventiveness, which seemed to grow as the decade progressed. Cohen was the intellectual leader and chief strategist in the early 1930s, although a heart attack in the mid-1930s reduced his energy and his ability to direct the work of the legal staff. Austin Tobin was one of Cohen’s small band of assistants; and in Tobin’s efforts in these years we see many of the characteristic traits that shaped his later career and the Port Authority’s direction for decades to follow.

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The challenges that confronted the law department arose from the distinctive position of the Port Authority as the first semi-autonomous, self-financed public authority in the United States, and as the “first instrumentality with continuing administrative functions to be created by an interstate compact.”17 Consequently its staff was continually faced with complex problems of legal drafting, and many of its actions generated court suits by those who argued that the agency was exceeding its appropriate—but not yet clearly defined—powers. The activities of Cohen and his staff described below should also be examined with some sense of the broader issues of governmental power embedded in their work. These can be summarized in terms of three sets of questions: 1. In a complex federal system, what steps are needed to protect a government agency from assaults on its discretion by rival centers of power? Specifically, should the national government be barred from taxing the property and revenues of state agencies, in order to ensure that the taxing power is not used to undercut the capacity of the states to function? Similarly, should state governments be prohibited from taxing the activities of the national government? Building on the early warning by Chief Justice John Marshall that “the power to tax involves the power to destroy,” a long line of cases had insulated both state and national agencies from the burden of taxes levied by each other. In the 1930s, the issues were to be argued again, with the Port Authority in the forefront both as target of taxation and as organizer of the antitax forces.18 2. If a government operates a “business,” generating significant revenues from customers or other users, is that activity exempt from the tax burdens that would have to be paid by a comparable private business? In grappling with this question, the U. S. Supreme Court had divided government activities into two categories—“governmental” (those which are “essential” to the functioning of the government), and “proprietary” (i.e., “businesses” and other activities not essential to a functioning government). State courts, for example, were placed in the first category, and the federal government was barred from levying taxes on state judicial salaries. If a state operated a liquor store, however, that enterprise could be taxed by the national government.19 3. Can state and local governments experiment with new kinds of public agencies and new types of governmental programs, without those creative efforts being blocked or hamstrung because of antagonism from private enterprise and jealousy from other levels of government? This general concern was a broader implication of questions 1 and 2 above. Much of the Port Author-

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ity’s legal energies in the 1930s and into the 1940s would be directed toward ensuring that its own evolving history would support a positive response to this question.

The Threat of State and Local Taxes During the 1920s, Julius Henry Cohen had begun to think about these issues, and particularly about the impact local, state and federal tax burdens might have on the Port Authority’s ability to function. Except for some “start-up” grants from state government, it seemed probable that the Port agency would have to meet the capital and operating costs of all its activities out of project revenues. Moreover, some—perhaps most—of its projects would be financially marginal; and any substantial tax obligations might therefore block the agency’s ability to undertake and finance these improvements. Yet it was likely to be a primary target for legal attack from the world of private enterprise, whose representatives could argue that the Authority was a business—whose “proprietary” activities should be subjected to the same tax burdens as those faced by its private competitors. Although the 1921 Compact creating the Port Authority said nothing about tax exemption, within its first year Cohen had begun to build defenses against the tax threat. In the spring of 1922, both states passed legislation, drafted by Cohen, which endorsed the agency’s detailed Comprehensive Plan, and embedded in those laws is a sentence which exempts any bonds issued by the Port Authority from state taxes.20 The issue of local taxation of Port Authority operations was a matter of greater concern to Cohen and his colleagues, since city officials might try to levy heavy imposts on the agency, in order to reduce the taxes to be paid by local voters. Moreover, a hostile administration, such as that of New York City’s Mayor Hylan, might use the taxing power as an intentional strategy to drain the agency’s coffers, undermining its ability to purchase city piers and terminal buildings. In 1924, when the bi-state agency explored the possibility of buying the Hoboken Railroad from the federal government, the issue of tax exemption was visible and contentious. Once privately owned, the Hoboken line had been taken over during the First World War by the national government, which paid local taxes on the railroad to the City of Hoboken. City officials demanded that the Port agency do the same, if it took control of the rail line; and Hoboken was then joined by Jersey City, Bayonne, and Newark in arguing that the Port Authority should be required to pay local taxes on its various

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projects. Their basic argument was that rail lines, piers, and other terminals were business operations (in the court’s terms, “proprietary,” not essential government functions), and that they should be taxed like any private business. The Port Authority said that it would be willing to pay some amount “in lieu of taxes,” but it resisted any agreement that would undermine its position that all its activities were essential public functions, and therefore immune from taxation by local governments. The tax issue was left unresolved at the time, since the Coolidge Administration and the Port Authority could not agree on arrangements for purchase of the rail line.21 To Cohen and the commissioners, the Hoboken conflict underscored the need to insulate the Authority from local taxes by engraving its tax exemption permanently in state law. In 1925, when the agency obtained state approval to issue bonds to finance the Staten Island bridges, the legislation stated that in constructing these spans the agency was performing a “governmental function,” and it barred local and state taxes on those facilities. The same phrasing was included in the George Washington Bridge legislation in 1926 and in the 1931 laws which brought the Holland Tunnel under the Port Authority’s control.22 Vehicular roadways, including bridges and tunnels, were commonly constructed and maintained by government, and therefore this activity might reasonably be labeled an “essential” function. However, public operation of rail spurs, freight terminals, and other facilities typically operated by private businesses was not so readily exempted from tax burdens under the standards suggested by the 1905 South Carolina case (note 19, above). In the fall of 1929, the Port agency and the railroads finally agreed that the Port Authority should construct a massive freight terminal in lower Manhattan, and the tax issue then emerged as a major legal and political problem. The basement and first floor of the building would be devoted to receiving, sorting, and sending out railway freight; but the rest of the building—14 floors, each a city block in size—would be rented to tenants engaged in warehousing, manufacture, and other activities. In 1929–30, the Manhattan rental market was already showing signs of distress, and private interests protested, arguing that the Port agency should not be allowed to add 14 floors for general tenants, especially if the terminal building were given the advantage of exemption from real-estate taxes.23 However, a two-story building could not be made self-supporting in itself, given the uncertainties of freight traffic and other factors. Therefore, it was clear to Cohen, and defensible to more objective observers, that the Port Authority must have the power to build and rent commercial space above the

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inland terminal. As Cohen argued, the Port Authority could develop a unified freight station—a crucial element in the Comprehensive Plan—only if it could offset the terminal deficit by renting space (at a “profit”) above the freight station.24 The issue of whether the entire building should be tax exempt was more challenging. As the Hoboken case had demonstrated, local officials would protest if property were simply removed from the tax rolls when the Port Authority purchased it, especially if the project had some earmarks of a “business,” as this building surely did. The protests might block the agency from obtaining state legislation which placed the terminal on the same (tax exempt) footing as the bridges and tunnels. On the other hand, Cohen and his associates could not accept the position that some Port Authority property should be fully taxable—treated as no more important a governmental duty than, say, a state liquor store. All of the Port agency’s activities were essential to its role as a regional development agency, in their view; and tax burdens which might increase year by year could block the Port Authority’s efforts to experiment with financially marginal projects to aid the region’s economy. What was needed was an imaginative compromise, and in the early months of 1931 Cohen and the states’ lawmakers found one. Rather than asking the states to endorse the position that the Port Authority would not pay local taxes, the new legislation would permit the agency to provide payments to local governments. So the Port Authority was now “authorized and empowered” to enter into a “voluntary agreement” whereby it would provide an annual payment to any county, city, or town, in connection with “any marine or inland terminal property” owned by the bi-state agency. The payment could not, however, exceed the sum “last paid as taxes upon such property” prior to purchase by the Port Authority. In this way the agency won state endorsement on the crucial issue, that the improvements made by the agency—modern buildings, new piers, marine equipment—would be protected from the burden of rising taxes. The Authority at once showed wary local officials the benefit of the new law, by announcing that it would begin paying to New York City “in lieu of taxes” $60,064.10 each year, the exact sum that the city had previously received on the inland-terminal property.25 The statute proved to be an important step in reducing local objections to the Port Authority’s activities; if the bi-state agency took over and modernized a pier or constructed a freight terminal, the town would not suffer tax losses—and it would probably be better off financially compared with state and federal programs, which generally provided no taxes or in-lieu payments. In addition, the law provided some financial predictability for Authority plan-

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ners, who, in considering whether to go forward with a project, could now calculate the continuing “tax burden” with some certainty. The new statute had another effect, difficult to see on first glance, but readily grasped by the creative and artful brain of Julius Henry Cohen. Authority officials could now point to the new law and argue that the two states had, by passing it, endorsed the position that the Port Authority was exempt from taxation on all its activities. Indeed, Cohen argued, that is why the states passed the new law—since otherwise the bi-state agency would be barred from paying local taxes. What could not readily be obtained by direct statute, tax exemption on all its works, was now a “necessary implication” of the 1931 act! At least that was Cohen’s interpretation, and among public officials it went unchallenged in the coming years.26 While Cohen wove these enticing chains around his state and local colleagues, his very junior assistant, Austin Tobin, was occupied with other aspects of the inland terminal project. Once the top staff had determined the location for the terminal, in 1928–29, they decided to create “dummy corporations” which could buy up parcels of land before the terminal’s site was publicly identified, thus obtaining the land at lower cost. Tobin took part in this effort. By 1930, it was clear that complex negotiations and perhaps legal condemnation procedures would be required to obtain some portions of the site; now two years out of law school, Tobin was named to the new post of Real Estate Attorney and given responsibility for pursuing these actions. Joined by another young lawyer, William Pallmé, and a legal assistant, Paul Reilly, Tobin carried out more than 80 negotiated purchases and condemnations in 1930–31, displaying the same drive and commitment to success that his classmates had seen at Holy Cross. For many months the legal team worked from 9 in the morning until 11 p.m. weekdays, plus half-day on Saturday; they were assisted by two stenographers, one on the regular day shift, the second arriving each day at 5 p.m. Tobin’s personal style combined intense concentration on the task with thoughtful treatment of his staff, and they accomplished much, enjoying the effort as well.27 Tobin and his aides learned that the standard cost of land to be used for large buildings (whether by purchase or condemnation) was one-tenth of the total cost of the project. He decided to aim well below that ratio, with the goal of saving 20 percent of the usual cost of land acquisition. In the condemnation cases, Tobin acted as trial attorney in almost all instances, and in the courtroom, the counsel for the property owners were “astounded by what they had to face”; instead of the usual “dreary proceedings” of modestly pre-

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pared lawyers struggling through complex documents, they found Tobin thoroughly prepared and ready to do battle. The condemnation team completed its task in 1931, with some realized cost savings, and excavation at the Eighth Avenue site commenced during the spring. By the fall of 1932, the lower two floors were completed and rail freight began to flow into the building, while construction continued on the upper floors.28

The Bush Terminal Sues to Block Tax Exemption At this point, some of New York’s business interests were stirred into action. They attacked the plans to add 14 stories above the two railway-freight floors, for that would bring the Port Authority “in direct competition” with tax-paying businesses that provided warehouse and manufacturing space. They also found the Port agency’s proposed $60,000 annual payment “wholly inadequate,” and they urged the city to levy taxes based on the full valuation of the completed building. Early in 1933, several private firms prepared to file a suit in Brooklyn to block the Port Authority’s claim of tax exemption. These plans came to the attention of that veteran employee of the Brooklyn court, Clarence Tobin, who at once alerted his son.29 Now Austin saw his chance to break free from the narrow box within which he had been operating. Generally cases outside traditional real-estate concerns would be assigned by Cohen to Leander Shelley, a very able lawyer who was ten years Tobin’s senior and who headed the Law Division. But as soon as he learned about the planned suit, Tobin said to Pallmé, “Let’s take it!” He asked Pallmé to gather information on all issues likely to be involved in the case, and the two of them then prepared a detailed memorandum which laid out the Port Authority’s position on the various points. On the same day in March that the Bush Company filed its complaint in Brooklyn, Tobin presented their analysis of the case to Cohen, with the comment, “since this case is related to our real estate concerns, I assume you want me to handle it.” Cohen agreed, and Tobin took the lead in preparing the brief. In devising a strategy to circumvent the usual assignment of cases, as in grappling aggressively with the condemnation challenge, Tobin illustrated his tendency to be a nonconformist.30 The court challenge was led by two of the largest freight transfer and warehousing firms in the region, the Bush Company and the New York Dock Company, which argued that tax exemption would permit the Port Authority to compete unfairly, since its costs would be less than those of private firms, whose heavier tax burdens would compel them to charge higher rents.

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A wide array of business associations also joined the suit. These included traditional opponents of the Authority’s regional approach—the Brooklyn Chamber of Commerce, the Queens Chamber, and the Long Island Real Estate Board—as well as the Lower Manhattan Industrial Association and Manhattan’s West Side Association of Commerce, groups generally friendly to the Port Authority. This extensive opposition illustrated the concern in the Depression that the agency’s “proprietary” activities might further undermine the shaky edifice of private enterprise.31 In countering their argument, Tobin and Pallmé prepared the kind of extensive analysis, replete with rhetorical flourishes and historical allusions, that had marked Cohen’s legal writings. Cohen then added further arguments and citations, and in October 1933, the Port Authority filed a document of 181 printed pages with the New York trial court. The brief argued that interstate treaties are “sacred obligations,” to be controlled “by the principles of international law”; here the authors paused to explain the relevance of the U.S.-British Treaty of 1783, which protected the liberty of Americans “to take fish of every kind” out of Newfoundland waters, and they asked the judge to contemplate Aix la Chapelle-Maastricht R. Co. v. Thewis, in which the Supreme Court of Cologne upheld the sovereign rights of the Royal Dutch Government “over certain mines within Prussian territory.” They found relevance as well in the United States Constitution; if either state should “become recalcitrant” in carrying out its obligations under any interstate treaty, those duties would be enforced by a “higher power,” the Federal Government.32 What the Bush suit was attempting to accomplish, argued the CohenTobin team, was to force New York City to levy a tax on the Port Authority; but such a tax would be unconstitutional, since the Authority was an agency not only of New York State but of New Jersey as well. Therefore, if Bush won the suit, and New York City levied a property tax, the federal courts would be compelled to nullify the tax, under the principles followed by American courts since McCulloch v. Maryland.33 Moreover, the system of federalism provided a second line of protection, separate from McCulloch. The Port Authority Compact should be viewed, Tobin argued, as a contract between the two states; and any effort to tax the agency’s activities would violate the “obligation of contracts” clause of the U. S. Constitution. Again, the federal courts would have to step in and protect the bi-state agency.34 Next the legal team turned to the question of “legislative intent.” Here the 1931 state legislation approving “in lieu” payments to cities with Port Author-

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ity projects offered just the ammunition needed. Those laws “constitute express legislative recognition” that the inland terminal was tax exempt, Cohen and Tobin argued; “could any language more clearly express the intention of the legislature?” A skeptic might answer that such clearer language could be found, simply by looking at other Port Authority legislation. One could also see in this Port Authority argument some echoes of Tobin’s earlier life in disguise: “What could be clearer than that I am Lady Mountbatten?”35 Finally, the Port Authority’s extensive brief challenged the argument that its new building should be described as “proprietary”—a business, such as a liquor store, which under court standards was subject to taxation. The upper floors might appear to have a profit-seeking goal, but that aim was only an element in the overall purpose of the building—to aid in achieving the Comprehensive Plan, which was an “essential function” of government (Port Authority brief, pp. 125 ff., 140 ff.). The trial took place in December 1933, with Cohen taking the lead in oral argument. Lawyers for the private terminals argued that the state legislatures knew what language to use if they wished to exempt an agency’s works from local taxes—as the 1925 bridge laws demonstrated—and that the involuted language of the so-called “in lieu” acts offered no such clear message. And they urged the judge to protect them from unfair competition generated by this tax-free real-estate entrepreneur. But the trial judge marched to a different drummer. As the Port Authority’s legal staff pointed out, after the decision was handed down, the court’s opinion “is really a digest of the Port Authority’s brief. It follows the sequence of the Port Authority’s argument, adopts our reasoning and cites the cases in support of the law that are cited in our brief.” The agency’s exemption from local taxation was fully upheld.36 While the Port Authority was fighting demands that it pay local taxes, and threatening to call upon a “higher power” to shield it from local incursions, the agents of that higher power were preparing their own assault on the Authority’s tax immunity. The first shot in the campaign from Washington arrived in the fall of 1933, as Cohen, Tobin, and their colleagues were finishing their Bush Terminal brief. Writing to the Port agency in early October, the Bureau of Internal Revenue said it had “tentatively reached the conclusion” that previous legal decisions, which exempted the salaries of Port Authority employees from the federal income tax, were incorrect. “If you care to be heard upon this question,” the letter concluded, the Bureau would meet with Authority officials before it started collecting taxes from the agency’s staff.37

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Here was an opportunity for Tobin to expand his domain. He went to see Cohen and suggested that since he was already involved in (real estate) tax litigation, and this was “another tax case,” he would be glad to take it too. Cohen assented, and Tobin now moved into a legal and political arena that would absorb most of his waking hours for the next eight years.

Prelude to the Washington Attack: Conflict in the Federal System Although the 1933 letter was the first shot in a new campaign, it grew out of a long history of efforts by the national government to collect taxes from state and local officials and agencies. In preparing their response to the Internal Revenue letter, Tobin and his aides reviewed court opinions and other materials relating to these earlier efforts, and that history deserves brief summary here. Traditionally, a major concern for state and local agencies has been the possibility that the national taxing power, vigorously wielded, could undermine their capacity to act as independent members in a federal system. As noted earlier, a line of cases from McCulloch (1819) through Collector (1871) to Pollock and beyond had, taken together, obviated that threat, blocking Washington from taxing state and local agencies and their employees, as well as providing reciprocal immunity for national officials. Pollock (1895) had a very wide reach. In this case, a group of taxpayers had challenged the income-tax provisions of the Revenue Act of 1894, and the Supreme Court responded in part by barring the federal government from collecting taxes on personal income received from state and local bonds (generally called “municipal bonds”); the Court also concluded that all the income-tax provisions in the 1894 Act violated the U.S. Constitution.38 To overcome this obstacle to raising revenue, Congress passed legislation amending the Constitution, and it was signed by the president and ratified by the states, becoming effective in 1913. The wording of the 16th Amendment, which would become crucial to the debate in the 1930s, follows: The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

Although the national government now had the clear power to levy an income tax, it was not certain whether Congress could include state and local salaries and bonds in its new revenue plans. Did the 16th Amendment only

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displace Pollock’s conclusion prohibiting a federal income tax, or did it also strip away state and local tax immunities? Despite the straightforward wording of the Amendment, Congressional and state debates surrounding ratification were ambiguous on the immunity issue. Some thought the 16th Amendment left reciprocal immunity intact, while others concluded that Congress, if it wished, was now free to tax all government salaries, and all municipal bonds as well.39 Once the 16th Amendment had been ratified by three-quarters of the states, an income levy was enacted by Congress and signed by President Woodrow Wilson. However, this 1913 law did not mention municipal bonds.40 Meanwhile, in the early years of the new century, cities and states had been borrowing extensively, issuing bonds in order to build highways and transit lines, to construct water and sewer systems, and to make a range of other capital improvements. As a consequence, by 1917–18 outstanding “municipals” exceeded $4.5 billion. The new income tax was progressive, setting higher rates on the wealthy; and as the top rate increased under the pressure of war financing to 10 percent and then in 1917 to 25 percent, these bonds, which continued to be exempt from federal taxes, became an attractive investment for those with large incomes. It seemed clear to many observers that municipal securities were permitting wealthy persons to escape their “fair share” of the nation’s tax burden, and Treasury Secretary William G. McAdoo led a campaign to tax municipal bonds. “Tax exemption is wrong in principle,” he argued. However, the provision was defeated in Congress in 1918, because of opposition from state and local officials and doubts as to whether it could survive scrutiny by the Supreme Court.41 In the early 1920s, opposition to tax-free securities gathered force from another quarter, as the U.S. Chamber of Commerce and the Investment Bankers Association attacked the “unfair competitive advantage” of municipal bonds. Private utilities were especially anxious to stop the issuance of exempt securities, which were being used by government bodies to construct electric power systems and other utilities. Because these bonds were tax free, government agencies were able to offer them with lower interest rates, saving large sums in interest costs. Were it not for these lower costs, those large capital projects might be undertaken by private enterprise, which, the utilities argued, was the preferred American way. Andrew Mellon, Secretary of the Treasury under Presidents Warren G. Harding and Calvin Coolidge, led the new effort to end tax exemption of bonds, and in 1924, the House approved a Constitutional amendment which would permit reciprocal taxation of government securities; but the Senate took no action.42

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The recurring campaigns against tax exemption made investors wary, and it seemed likely that Port Authority bonds would be highly vulnerable—challenged by opponents as bonds issued by a “proprietary” agency, taxable like state liquor-store sales. In 1925, when the Port Authority prepared to sell its first securities (to finance the Goethals and Outerbridge spans to Staten Island), Cohen asked Charles Evans Hughes, a former member of the U.S. Supreme Court, to review the Authority’s legal status. Hughes’ detailed analysis concluded that the agency was not a proprietary agency but was engaged in crucial public functions, and that its bonds were exempt from federal taxes. This finding aided the Authority in selling its bonds at a moderate interest cost throughout the 1920s.43 Treasury officials then opened a second front, focused on salaries, hoping to enmesh the Port Authority and other similar agencies. Treasury’s general concern was that the salaries of state and local public officials were exempt from federal taxes. Perhaps moneys paid to officials in traditional government agencies were immune under Collector v. Day, but the expanding array of autonomous agencies might not be equally protected; possibly the courts could be persuaded that these were “proprietary” enterprises, whose employees should be required to pay federal income taxes. Moreover, it seemed likely that the “salaries” allotted to some of their engineers were really fees paid to independent contractors, and thus taxable under settled court opinion. To explore the limits of salary immunity, the Bureau of Internal Revenue targeted engineers employed by the Port Authority and other semi-independent agencies, to compel them to pay back taxes. The leading case, against Leon Moisseiff, was in a sense brilliantly conceived. During the early 1920s he had worked part-time as Engineer of Design at the joint commission which was constructing a major span over the Delaware River (later named the Benjamin Franklin Bridge), and in the late 1920s he moved to the Port Authority, where he had served as Advisory Engineer of Design. Moisseiff had a distinguished national reputation. In the tradition of engineering, these facts suggested that he would have the flexibility in hours and the discretion in using his own judgment typical of an independent contractor, and Treasury had previously won the battle to collect taxes from engineers under contract. Moreover, in selecting Moisseiff as a prime test case or “guinea pig,” Internal Revenue was also targeting the Port Authority, perhaps the leading example of the new breed of semi-independent agencies. A victory here might provide publicity and momentum to the Treasury campaign.44

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This first assault from Washington failed. The case came before the U.S. Board of Tax Appeals in 1930, and Julius Henry Cohen defended Moisseiff. Cohen persuaded the Tax Board that the Port Authority and the Franklin Bridge commission were “engaged in essential governmental functions” (not “proprietary” activities), and that Moisseiff was indeed a salaried employee. Internal Revenue continued to press a related case, to collect taxes from a “part-time” chief engineer of the Ben Franklin Bridge commission; but the Tax Appeals board rejected that plea as well, in a decision handed down in August 1933.45 However, Treasury was prepared to challenge the Tax Appeals findings, and with Franklin Roosevelt now in the White House, those who advocated ending tax exemption—and thus striking a blow for “tax fairness”—might anticipate enthusiastic support from the new Administration. And so, early in the fall of 1933, the Port Authority received the letter that brought Austin Tobin into the federal tax battle.

The Roosevelt Administration Takes Aim at the Port Authority [This is] a gigantic enterprise earning millions of dollars of annual revenues. —U.S. Department of Justice, Commissioner of Internal Revenue v. Gerhardt, 1938 brief

Cohen and his associates responded to the October 1933 letter by asking for a meeting to explore Treasury’s intentions. At that conference, it became clear that the new attack would be the first step in an effort to eliminate all tax exemptions for government salaries.46 Tobin took the lead in preparing an analysis which might convince Treasury to abandon its plans and, if that were unsuccessful, which would lay the groundwork for the bi-state agency’s defense in the coming court battles. The Port Authority’s argument began by challenging the view—long influential in Supreme Court decisions—that the proper test for immunity from federal taxes was whether a state agency was engaged in “essential” governmental functions (if so, it was exempt), or in “proprietary” activities such as selling liquor (then its employees and all its operations were subject to federal taxes). The continued use of the essential/proprietary distinction would place many of the Authority’s operations at risk, since its efforts to build and operate inland terminals, to modernize piers, and to carry out other projects would depend on generating substantial revenues from these operations.

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Under current judicial thinking, this “businesslike” search for profits would expose the Port agency to recurring demands that it pay federal taxes. The proper criterion for tax exemption, argued Tobin and his colleagues, is whether the tax would cause a burden on the governmental agency, retarding its ability to carry out its duties. Using this perspective, Internal Revenue—and the courts—should be able to see that “any attempt by the Federal Government” to tax the Port Authority’s work would “damage, if not frustrate wholly, the efforts . . . to provide self-liquidating public improvements” in the Port District.47 A substantial federal tax on the Port Authority’s bridge and tunnel revenues, or on its struggling inland terminal project might well undermine the agency’s ability to survive. But would the modest step urged by Treasury— that Port Authority employees should pay the regular federal income tax, then at a maximum rate of 10 percent—have any such effects? That modest first step would lead to ruinous consequences, Tobin and his associates argued. “We cannot think of any theory of law by which it can be claimed that the property of the Port Authority and its bonds are immune from taxation,” their brief asserted, once the salaries of its employees were subject to the federal income levy. To tax salaries would inevitably lead to taxing the bonds and activities of the agency, and so “prevent the carrying out of the comprehensive plan as a self-liquidating public enterprise”; the work of the Port Authority would “substantially come to a halt.” Tossing all the tax immunities into the same legal basket in this way had the advantage of providing support for their claim that the power to tax any aspect of the Port Authority’s efforts risked disaster. However, it was a hazardous tactical step, which Cohen and Tobin might later come to regret and would certainly abandon if they lost the salary case.48 The bi-state agency submitted its brief early in 1934, and a few months later, the trial court decided the Bush Terminal case. As noted earlier, the court endorsed the Port Authority’s view that the inland terminal was exempt from taxation; it also concluded that the Authority was carrying out a “most important governmental function” and that its tax immunity was equal to that of the two states. These judicial views will be “of immense help,” Tobin and his colleagues noted in an internal staff memorandum, “in the tax cases which lay before us.”49 When the Bush Terminal coalition decided to appeal, Tobin took responsibility for the appeal brief. By the summer of 1934, Tobin was occupied with the federal tax issue, the Bush appeal, and a variety of real estate matters. He worked days, nights, and weekends. Tobin and his main assistant, William Pallmé, needed help and

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they realized there was a community of high-quality legal talent from which they could draw—the pool of young Jewish lawyers who were blocked from major Manhattan law firms. Pallmé proposed Sidney Goldstein, who had been a clerk in Pallmé’s old firm, and he was soon hired, mainly to work on real estate matters. It was not long, however, before he was spending time on the federal tax issue as well.50 Tobin and Goldstein soon became close friends. “Often Sidney would come home with him,” a family member recalls, “and they would talk through dinner and after dinner, for hours.” One of Tobin’s children remembers: “When I was young I thought my father was in the luggage business. He and Sidney were always talking about ‘briefs’ and ‘cases.’ ” The long hours that Tobin devoted to his Port Authority activities were no burden. “I’m the luckiest guy in the world,” he would tell his friends, “I love my work!” To some who knew of his sharp break with the Church, a connection seemed apparent; as one commented: “Austin adopted the Port Authority as a religion; it was his whole life.” However, particularly in the 1930s, the Port Authority was not quite his whole life, though it was a substantial chunk; he enjoyed parties, he would take long walks with Geraldine and his children—often across Brooklyn Bridge and into Manhattan from their Brooklyn home—and he and Gerry went on several trips, including a long cross-country sojourn, which was planned with the same energy and completeness that marked his other efforts. In all these activities, Austin demonstrated not so much the impact of a break with the Church as the impact of lessons learned at home and in school, on the value of hard work. And he demonstrated too the perspicacity of the anonymous writer who had drafted his biographical sketch for the Holy Cross yearbook.51 As expected, the Port Authority argument defending tax exemption of employee salaries did not persuade the Roosevelt Administration, and its lawyers soon singled out three Port Authority employees who had not paid federal income taxes on their salaries. Tobin took charge of preparing the staff members’ defense, as they faced a hearing in 1935 at the Board of Tax Appeals.52 By 1935, Tobin had responsibility for all tax litigation involving the Port Authority, and he was anxious to shed the “back-water” image of a “real estate lawyer.”53 Cohen accepted the argument that a change of title was appropriate, and Tobin was promoted to Assistant General Counsel. With the salary cases absorbing much of his time, Tobin then sought another aide, and Daniel Goldberg joined his staff that year. Because the issue of tax exemption for salaries affected many municipal and state agencies, Tobin, Goldberg and Cohen contacted attorneys general in several states as well as other

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public authorities across the country, and obtained supporting briefs; indeed Tobin and Goldberg had central roles in drafting the briefs submitted by New York State and by the American Association of Port Authorities.54 In October 1936, the U.S. Board of Tax Appeals handed the Port Authority and their allies a victory in the employee tax case. As expected, the Administration appealed, but once more the Port Authority won, as the U.S. Court of Appeals upheld tax exemption for state employees and for governmental operations generally. Now the federal government appealed to the Supreme Court, arguing that the Port Authority should be stripped of tax immunity because its activities were “proprietary,” not governmental. At this point Tobin and his colleagues faced a turn in the wheel of fortune that would bring defeat in the salary cases—and in so doing, set the stage for revitalizing the Port Authority.55 Although the Supreme Court had affirmed tax immunity of salaries in several cases decided in 1937, its decisions in the previous ten years provided no clear criteria for determining when salaries of public officials should be taxable by other governments and when they should be immune. The Court’s 1938 decision in Gerhardt might have been no more than another contribution to this hodge-podge. Through happenstance, however, responsibility for drafting the opinion landed in the lap of Justice Harlan Fiske Stone, who used the opportunity to take an important step in cutting down the tradition of tax immunity.56 Stone had long been concerned about the erosion of the tax base, as state, local and national governments reached into new fields of activity.57 However, he was doubtful the government’s position in Gerhardt—that the Authority’s operations were “proprietary”—was a clear basis for ending tax immunity. He argued instead that only activities “essential to the preservation of state governments” should be protected from federal taxes; and even when “essential” activities are involved, immunity from taxes should be allowed only if those taxes would be an “actual and substantial” burden in carrying out state programs. Combining these “guiding principles,” Stone managed to gather the endorsement of three of his colleagues for a draft opinion which endorsed the Treasury position and stripped tax immunity from Port Authority employees. Applying the federal income tax to those officials, Stone wrote, “neither precludes nor threatens unreasonably to obstruct any function essential to the continued existence of the state government.” The Gerhardt decision was announced on May 23, 1938, and soon after, in Graves v. O'Keefe, the Supreme Court endorsed the Administration’s general argument—that personal in-

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come taxes do not in any significant way burden the activities of the employee’s government. At last the Court agreed that no government salaries should be immune from taxation, ending the protection offered by that ancient bane of thirsty tax officials, Collector v. Day.58 From the perspective of Cohen, Tobin and their colleagues, the Gerhardt decision was a disappointment, and perhaps a surprise too, in view of the Supreme Court opinions in Rogers and Brush, only a year earlier, which had endorsed salary immunity.59 Moreover, the strategy which Cohen and Tobin had adopted—to argue that tax immunities for salaries and bonds and operations formed a seamless web (to end immunity for one would imply that all should be taxed)—now seemed a poor choice; if Treasury next pressed the argument that federal taxes should be paid on municipal bonds as well as salaries, much intellectual effort would have to be devoted to disentangling the threads of that web. Meanwhile, there was a small portion of energy available for play, and when newspaper columnist Westbrook Pegler applauded the Gerhardt decision, combining it with one of his recurring attacks on government employees as “parasitical functionaries,” Tobin and his associates had their cue. At the annual Port Authority summer garden party, “we celebrated our defeat,” Cohen later recalled. The lawyers appeared wearing sandwich boards, which proclaimed in large letters, “I am a Parasitical Functionary,” and other staff members sang a fitting Gilbert and Sullivan melody. The scene seemed to echo Tobin’s frolics at Holy Cross.60

10 The Threat to Municipal Bonds as Danger and Opportunity

For more than twenty years Secretaries of the Treasury have reported to the Congress the growing evils of these tax exemptions. . . . A fair and effective progressive income tax and a huge perpetual reserve of tax-exempt bonds cannot exist side by side. —Franklin D. Roosevelt, April 25, 1938

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lthough the most visible Treasury effort in the early and mid-1930s was directed toward stripping tax exemption from government salaries, municipal bonds were not forgotten. The 1932 election added to the number of House and Senate members sensitive to the charge that wealthy individuals put their money into tax-exempt securities in order to escape their “fair share” of federal taxes. In 1933 and again in 1934, efforts were made in both houses of Congress to enact legislation that would tax municipal bonds, but these initiatives failed. A major hurdle was the widely held sense that such legislation would be thrown out by the courts—declared unconstitutional under the standards of tax immunity the Supreme Court had hammered out across several decades, extending from Pollock to Indian Motocycle. In 1934, Treasury officials in the new Administration suggested that this difficulty be overcome via a Constitutional Amendment, and the next year, conveying his own antagonism to wealthy individuals who avoided paying taxes, Franklin Roosevelt endorsed that strategy.1 Response to that approach was lukewarm in Congress, and in 1937 FDR and his Treasury aides explored the alternative of simply ending tax exemption by Congressional legislation. This shift was encouraged by the sharp change in direction at the Supreme Court, as Court majorities began to overrule long-standing precedents and endorse New Deal initiatives. If Congress were to extend the income tax to municipal bonds, the Court might now acquiesce, using an expansive interpretation of the 16th Amendment.2 214

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While the Supreme Court was still considering the salary question presented in Gerhardt, Roosevelt announced his new strategy for municipal bonds. In a message to Congress on April 25, 1938, he argued that tax-exempt securities undermined a “fair or effective” tax system, “giving greater advantage to those with large incomes.” FDR urged that “a short and simple statute” be approved, subjecting “all future state and local bonds to existing federal taxes” and giving reciprocal taxing rights to the states.3 In late May the Supreme Court announced its Gerhardt decision. FDR and Treasury could now proceed with some confidence that a legislative strategy to strip tax immunity from municipal bonds would win endorsement from the Court.

An Adroit Mixing of Politics and Expertise “We had fought hard” to protect salaries, Daniel Goldberg recalled, because “we knew that Treasury would jump to municipals” once the salary battle was resolved. Now Cohen and his aides devised a two-part response to FDR’s attack on municipal bonds. Cohen and Tobin developed a legal argument defending tax-exempt bonds; and Tobin and his assistants began to construct a political strategy to block FDR’s plan. The legal argument required a bit of intellectual revisionism, since the Port Authority’s initial position had been that there was “not the slightest basis in the law” for distinguishing between salaries and bonds; either both were tax-exempt, or both were taxable.4 There was, however, a silver lining in Justice Stone’s Gerhardt opinion, since he appeared to endorse one argument developed in the Port agency’s 1934 brief—that taxation should be barred by the Court if it would “burden” government functions. Within a few days Cohen handed the commissioners and the press a legal opinion which offered some modest comfort for Port Authority bondholders. The salaries paid to Philip Gerhardt and other Port Authority employees were not exempt, as Cohen interpreted the Court opinion, because the “burden on the State” if they were required to pay a personal income tax was “speculative and uncertain.” If, however, the Court were faced with a law that stripped exemption from Port Authority bonds, Cohen was certain that the “burden” criterion would lead the Justices to a very different conclusion: “A tax upon Port Authority bonds or revenues would directly burden and impair (and perhaps entirely nullify)” the ability of the States to build interstate bridges and carry out other important functions.5

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Cohen wrote with his usual confident flourishes, but the evidence that a tax on bonds would actually interfere with the ability of the states to carry out their duties was nowhere in Cohen’s opinion. Indeed, a close student of municipal bonds might have found his assertion quite speculative, and therefore vulnerable to the lens of skepticism Stone had used to put an end to tax-exempt salaries.

Tobin Constructs a National Coalition However, Tobin was not inclined to rely solely upon arguments made in the judicial arena. Motivated by personal ambition and energy not yet fully occupied, and by the shrewd insight that this was primarily a political rather than a legal issue, Tobin took the first steps to meet Roosevelt on his own ground. Working with Goldberg, he sketched out a plan to create a national organization which could lead the fight to keep municipal bonds taxexempt, and he readily obtained Cohen’s support to carry out this strategy. (Cohen had “great confidence in Tobin and his judgment,” Goldberg recalls.) Then Tobin went to John Ramsey, the general manager, and argued that since the Roosevelt plan was a major threat to the Port Authority’s ability to sell bonds and carry forward its program, the Authority should “bankroll the idea” he had developed. Ramsey agreed, and so did the Port Authority board. Tobin then urged Cohen to enlist Henry Epstein, a distinguished lawyer and Solicitor General of New York State, in the cause. Recognizing the danger FDR’s threat posed to New York’s extensive bondissuing program, Epstein readily signed on, and Connecticut’s Attorney General agreed to join too. With their concurrence, Tobin then sent telegrams to attorneys general and officials of public authorities across the country, asking that they attend a meeting in Washington, D.C. at the end of May.6 In attempting to gather support for a national campaign to oppose Roosevelt’s plans, Tobin could draw upon two concerns growing out of the Gerhardt decision. The first was that the federal taxing power might, as FDR hoped, be extended to municipal bonds—an action that could weaken the ability of states and cities to finance new capital programs. However, that negative impact was conjectural, and it was not clear that this conjecture would provide sustained motivation for busy officials around the country to devote their energies to a national campaign. The second issue was far more salient. Stone’s Gerhardt opinion declared, in effect, that salaries paid to Port

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Authority officials (and those working in similar agencies) had always been taxable; as a result, thousands of state and local employees suddenly owed ten years or more in back taxes, plus interest, and Congressional action would be needed to cancel those extensive liabilities. So it was this issue— the need for prompt action “to protect state employees from retroactive taxation”—that Tobin stressed in his call for the meeting.7 In response, more than two dozen attorneys general and executives from several public authorities met in Washington on May 31, 1937 to consider the problem, and the next day their representatives conferred with Treasury officials in the hope the Administration would agree to support Congressional action to waive back taxes. At this point, Morgenthau and his aides made what turned out to be an important tactical error: They refused to endorse a bill which would waive tax liabilities, and in early June Treasury pressed its advantage by sending tax agents to demand back taxes from officials of public agencies in New York, Pennsylvania, and California. Then, when sympathetic members of Congress introduced bills that would waive payment of back taxes, Administration officials persuaded their own allies on Capitol Hill to block action, leaving the threat of large tax payments hanging over the heads of state and local government employees.8 Treasury’s intransigence provided just the motivation that Tobin and his associates needed. By late June, a formal “Conference on State Defense” had been organized, with a steering committee that included a dozen top state officials drawn from all parts of the country, and with Tobin in the key administrative role. Funds as well as staffing were provided mainly by the Port Authority. Then Tobin persuaded Mortimer Edelstein, who worked in another division of the law department, to join his campaign; Edelstein was delighted. During the fall, Tobin, Goldberg, and Edelstein made contact with state officials and local employees across the country. They constructed a mailing list and sent out frequent reports, summarizing developments in the campaign and emphasizing the need to fight against “the crushing burden” of back taxes, which would be “ruinous to almost every state, county and municipal officer and employee.” As one member of the team later recalled, the series of reports was “a great tool—to keep all the people around the country informed and to unify their efforts.”9 The proposal to tax government bonds was also included in the grassroots campaign, as a second “real danger” that could undermine the financial strength of state and local governments. However, local sentiment was divided on this issue, and Tobin’s mailings in 1938 sought to keep even those who favored taxing municipal bonds as active members of his coalition.10

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Meanwhile, Tobin and other Conference leaders spoke before finance experts and other specialized groups, where they argued that taxing municipal bonds would increase the costs of state and local governments. Moreover, they interpreted the Treasury attack on salaries and bonds as part of a wider trend toward centralized government, which would squeeze out the valuable role of state experimentation.11 By the end of the year, the Conference on State Defense included 39 of the 48 attorneys general, and its campaign had won support from the United States Conference of Mayors, the American Municipal Association, the Council of State Governments, national organizations of police, firefighters, and teachers, and a wide range of other governmental bodies and related interest groups.12

The Impact of Research and a Grass-Roots Strategy As Tobin took the lead in organizing the campaign against FDR and his Treasury associates, several motivations shaped his perceptions and his actions. First, he was ambitious; and here was an opportunity to demonstrate his range of abilities, which might lead to interesting new opportunities at the Port Authority or beyond. Second, he was a “natural organizer,” who enjoyed gathering people together, endowing their efforts with a common purpose, and orchestrating their activities as they marched toward ends he had chosen. We saw these talents in campus activities at Holy Cross; now he employed them on a larger canvas. And third, he enjoyed combat, especially if he could do battle against well-armed opponents. The Jesuit fathers had been worthy adversaries, and their successors were now Franklin Roosevelt, Henry Morgenthau, and the hungry folks at Internal Revenue. Then there was the substantive issue—defending tax exemption, especially for municipal bonds. Tobin’s attitude toward this issue was more complex than it might appear. At first glance, he seemed to be motivated mainly by a concern that ending tax exemption would sharply increase the costs to the Port Authority and other public agencies for financing capital improvements. But was this really a significant problem? As we will see, the evidence on the financial impact of taxing municipal bonds was mixed, and there is some doubt that Tobin and his aides were as concerned as their rhetoric suggests.13 For Tobin there was, however, a deeper issue embedded in the Roosevelt attack on municipal bonds. As a Wilsonian Democrat—an advocate of an “activist” government, whose efforts should be directed toward improving the economy and reducing social inequalities—Tobin had been a

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supporter of FDR and his early New Deal plans. These same values led him to view sympathetically the basic goals Roosevelt articulated when he attacked exempt bonds—to make the tax system more equitable, and to provide the moneys needed to carry out major New Deal programs. But FDR’s 1937 “court-packing” plan had shocked Tobin, as it had many others. Now he was more sensitive to the dangers that might follow, if an activist government meant centralized power in the White House. If the Constitution no longer protected tax exemption, for example, the national government could decide to discourage investment in some fields by taxing those bonds, while leaving others exempt. In this way, state and local development strategies might be manipulated from Washington; the benefits of permitting diverse approaches to complex problems could be lost. And there were larger dangers to individual liberty that might come with centralized power, if it were unprincipled; this concern was underscored by Treasury’s punitive approach to collecting back taxes, in the weeks after the Gerhardt decision was announced.14 The November 1938 election moderated the political climate somewhat. FDR lost the overwhelming Democratic majorities in Congress the 1936 landslide had given him, but there was still much support for the effort to change the tax system.15 The Senate had created a Special Committee on Taxation of Governmental Securities and Salaries, and that Committee was planning to hold hearings early in 1939, as a first step toward Congressional legislation to tax municipals. It seemed clear that Treasury would open the assault by labeling municipal bonds as beneficial primarily to the rich, permitting them to evade taxes. What Tobin and his allies needed was solid evidence to counter Treasury’s assertions—evidence that tax-exempt bonds were more beneficial to states and cities than they were harmful in undercutting a progressive tax system. Toward the end of 1938, Tobin found the opening wedge he needed, a 1926 study that identified savings which the states had obtained in their interest payments, because their bonds were exempt from federal taxes. “This is assigned reading for everyone!” he said to his staff. “Let’s update it. We need a professor.” Most public finance experts, including prominent faculty members at Columbia and Yale, were opposed to tax-exempt bonds, but Tobin approached a well-known Princeton economist, Harley Lutz, who agreed to develop the case for exemption, building on the 1926 analysis. Cohen and Ramsey endorsed Tobin’s plan, and in December the Port Authority board agreed to pay Lutz $2500 for a detailed study, while adding another $5000 to support the national campaign.16

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Lutz had once been a sharp critic of tax exemption, and to some his conversion to the cause illustrated the persuasive power of Austin Tobin combined with a handsome fee. What is clear in retrospect is that Tobin had made an excellent choice; Lutz’s 200-page report, which was packed with arguments and evidence supporting Tobin’s position, would be a major force in countering Treasury’s contentions at the Senate hearings and beyond.17 In the first weeks of 1939, President Roosevelt opened the campaign with a cleverly worded message to Congress. He extended his sympathy to public employees who would be compelled to pay back taxes on their income under the Gerhardt standard, unless Congress acted. To meet their plight, FDR urged “immediate legislation,” which would protect salaried employees, and investors in exempt securities as well. The new law would ensure that courts could not impose tax liability “on these innocent employees and investors for salaries heretofore earned, or on income derived from securities heretofore issued.” However, while ending all past tax liabilities, the statute would “at the same time . . . make private income from all government salaries hereafter earned and from all government securities hereafter issued subject to the general income tax laws of the Nation” and of the states.18 Tobin and his allies ground their collective teeth and growled at FDR’s attempt to intertwine past tax liabilities with his campaign to end bond exemptions—holding the first hostage to the second—but they turned their primary attention to the Special Senate Committee, which would begin its hearings on taxing salaries and municipal bonds in mid-January. As they surveyed the political terrain, it was clear that the ominous cloud of back taxes had served Tobin’s purposes well. During the fall and winter of 1938, that danger, combined with the more complex issue of municipal-bond interest, had allowed the Conference staff to gather support from an array of national and regional groups willing to testify in opposition to the Roosevelt plan. Tobin orchestrated the opposition testimony, and during the hearings, which extended into February, the members of the Senate committee met the full force of his strategy. On the opening day, the Committee heard from six senior Administration officials, who offered detailed arguments—based on Constitutional law, democratic theory, and economic analysis—in support of the FDR plan. One speaker pointed out that every U.S. President since Warren Harding and almost every Treasury official since the 16th Amendment was enacted in 1913 had opposed tax exemption of government bonds. Exempt securities helped wealthy taxpayers far more than middle-class citizens, the Administration

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team argued; and investors whose capital should be used to modernize American industry instead diverted their funds to these low-risk bonds. Moreover, taxing these bonds was almost certainly Constitutional under the Income Tax Amendment; Gerhardt and other recent Supreme Court decisions were consistent with this view, they argued, and if there was any doubt “a simple statute” could be passed and then tested in the courts.19 The next five days, however, were occupied with reports, testimony, and resolutions in opposition, in a continued procession devised by Tobin.20 The first speaker in the opposition phalanx was Professor Lutz, armed with his voluminous report, which cast doubt on the argument that tax-exempt bonds were mainly held by the wealthy, and which argued that making municipal bonds fully taxable by the federal government would increase interest costs by 20–30 percent. Tobin had suggested to Lutz that the political impact of his analysis would be enhanced if he cited specific cities across the country, and Lutz had calculated the increases in the local tax rate, and in total local taxes, if Roosevelt’s plan were enacted. Detroit would have to raise an additional $2.5 million in local taxes; Boston and San Francisco would need to raise more than $1 million each; in Miami, Indianapolis, and Dallas the burden would be more than $230,000 a piece in new taxes; and the increases in smaller cities such as South Bend and Tacoma and Trenton were also displayed in Lutz’s tables.21 Next came Fiorello LaGuardia, New York City’s mayor and the president of the U.S. Conference of Mayors. LaGuardia brought resolutions opposing FDR’s plan from 70 cities across the country, and he presented his own arguments against the proposal.22 Then the Senators heard from a representative of North Carolina’s league of cities and towns, with 171 active members, followed by his counterparts from California, representing 258 cities, and Kentucky (186 cities), and Alabama (104); all opposed the president’s plan. Tobin spoke briefly and brought resolutions in opposition by leagues of cities in 23 other states and by several dozen other local and state groups. He quoted from a letter sent by Robert Moses, who in the late 1930s was head of six bridge and roadway authorities in New York; Moses concluded, on the basis of his experience in selling millions of dollars in bonds, that without tax exemption “the bonds probably could not have been sold at all” and the vast highway network then under construction would only have been possible by “resorting to taxation and large Government subsidies.” These speakers were followed by an official of the American Municipal Association, representing 7,300 cities and towns across the nation, and speaking also for separate leagues of cities in more than 20 states, all in opposition.23

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During the several days of testimony marshaled by Tobin and his aides, the directors of pension funds, city legal officers, the national association of municipal finance officers, and dozens of others also lent their voices to the demand that local and state bonds remain tax exempt. All viewed with alarm the extra interest cost which cities and towns would have to pay if their securities were taxable; and some thought it likely that the bonds of weaker municipalities could not be sold at all if that burden were added. Although the Lutz study had not been completed until shortly before the hearings began, several of the resolutions and testimony drew on his analysis to provide the kind of detail that made the criticisms and arguments more pointed.24 Tobin also brought in Frank Ferguson to testify, but when the Port Authority chairman departed from his prepared text, he stumbled, providing ammunition for the opponents of tax-exempt securities. Julius Henry Cohen more than made up the slippage, however, as he spoke at length—beginning on Friday afternoon and continuing on Saturday morning—casting doubt on the constitutionality of taxing municipal bonds, and arguing that if tax exemption were eliminated, bonds to provide low-cost housing, public power, and highway facilities such as the Port Authority’s own Staten Island and George Washington bridges might often not find a buyer.25 Although a majority of Senators on the Special Committee favored the Roosevelt plan, the first six days had been dominated by the opponents. Three more days of testimony were scheduled, and the Administration fought back, bringing in economists from New York University, City College of New York, and Wesleyan, as well as Treasury experts, to challenge the arguments of Tobin’s coalition. Their efforts were aimed mainly at dismantling the extensive analysis in the Lutz report in favor of tax exemption, and in this task they made some headway. When pressed, however, they had to admit that, if municipal bonds were subjected to the federal income tax, cities and states across the country would find their borrowing costs raised by 10–20 percent, an increase that translated into higher local property taxes and excise taxes. If tax exemption were ended, the nation as a whole might be better off in terms of economic justice and tax efficiency; but for members of the Senate who were concerned about the economic problems of their individual states, and their own prospects for re-election, the debate raised disturbing prospects. And when the Administration team “assumed away” these economic and political realities, they did little to help their cause.26 As the ninth and final day of testimony drew toward a close, with Treasury officials hammering away at the testimony of Lutz, Cohen, and their allies,

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10-1. Tobin and Cohen at the 1939 Senate hearing (a sketch made in 1952)

Cohen suddenly emerged again almost as though he were a member of the Senate committee. While one Treasury lawyer was testifying, Cohen spoke up from the audience, cross-examining the witness and forcing him to explain why his Department was altering its argument on an important issue; Chairman Prentiss Brown (who supported FDR’s plan) sat silent. Later, Senator Brown interrupted Administration testimony to obtain the views of Cohen and Tobin on a historical issue, and in response Cohen then offered a lecture on legal issues which undermined the chairman’s attempt to add weight to the Administration position.27 Meanwhile, as the Special Committee pondered the issue of municipal bonds, legislation to end the threat of back taxes on employee salaries had moved ahead—despite FDR’s and Treasury’s hope that such legislation might be deferred until it could be coupled with taxes on future bond sales and future salaries. Speaking for the Conference on State Defense and for public employees generally, Tobin urged that relief from back taxes be treated separately from those other issues and enacted promptly, and his position was widely shared on Capitol Hill.28 By late February 1939, favorable committee action

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had been taken in both houses. In late March, as noted earlier, the Supreme Court announced its decision in Graves v. O’Keefe, reversing Collector v. Day and permitting taxation of all government salaries. A few days later, both houses passed legislation barring liability for back taxes and, though reluctant to lose the advantage of linking that action to a tax on bonds, Roosevelt signed the bill on April 12. With the salary issue laid to rest, the two sides would now turn their full attention to the problem of municipal securities.

Roosevelt Defeated In his book on political influence, The Power Game, Hedrick Smith contrasts the traditional methods of Washington pressure groups with what he calls “new-breed lobbying.” The older approach emphasizes one-on-one discussions with members of Congress, and with other government officials, by lobbyists who can use their specialized knowledge—as well as a pool of funds for the next electoral campaign and other individualized benefits—to help sway Congressional votes and other decisions. In new-breed lobbying, those who want to shape action in Congress go to the grass roots, swaying votes by demonstrating “that the home folks are with them.”29 In Smith’s interpretation, the “new-breed” strategy began with citizen protest directed at the Vietnam War and other issues of the 1960s. However, a quarter of a century earlier, the lobbying effort aimed at the 1939 Senate Committee demonstrated very similar characteristics. And when Tobin turned to the House of Representatives, he then added a dimension which even more clearly suggests that the Conference on State Defense should be viewed as an early exemplar of “new-breed lobbying.” The battle in the House began in late March, while the Senate Committee was still pondering the Administration’s plan. Shortly after the O’Keefe salary decision was handed down, FDR announced that he would ask Henry Morgenthau, the Treasury Secretary, to include in his new revenue bill a provision that would make the income from all state, municipal, and federal bonds fully taxable. The tax proposal would go first to the House Ways and Means Committee, so Tobin extracted an additional $3000 from the Port Authority budget and began to work out a strategy to counter Administration pressure on that body.30 The first step was to scrutinize Ways and Means in order to determine which members were likely to favor Roosevelt’s plan, and of these which might change their views if protests were heard from their home districts. As Tobin, Edelstein, and Goldberg reviewed the cast of characters, they con-

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cluded that the 10 Republicans on the committee were not likely to support the president; the criticisms voiced at the Senate hearings in February would, it seemed clear, reinforce their general antipathy to Rooseveltian schemes. There were, however, 15 Democrats on Ways and Means, and most of them would probably support FDR if the home front remained silent. Tobin decided to concentrate on the cities and towns of those 15 Congressional Districts, and especially on the localities that could quickly be reached by train and automobile—those in the East, Midwest, and Upper South. It was now early May, and they had perhaps six weeks before hearings would begin.31 They divided the districts into two groups. Goldberg was assigned Robert Doughton, chairman of Ways and Means, whose district was in the western part of North Carolina, and A. Willis Robertson, who was from the Shenandoah region of Virginia. “I took my new car and Moody’s publications, with their listings of tax rate and outstanding bonds,” Goldberg recalled, “and drove to a motel in Front Royal, Virginia.” There he took the information in Moody’s, computed the increase in the local tax rate if the outstanding bonds were taxable, and brought this information to City Hall. Finding a town official who seemed interested, Goldberg explained the danger of the Roosevelt plan, and he urged that the city council adopt a resolution against the FDR scheme and send it to Willis Robertson. He stopped at other towns in the Virginia District, and then drove south and met with finance officers and other city officials in Doughton’s region. Later he motored to Pennsylvania and Indiana. Edelstein’s assignment took him to Richard Duncan’s district in Missouri, and then to Oklahoma, where Congressman Wesley Disney held a seat. He traveled to Paul Maloney’s district in Louisiana, and then north to the districts of Raymond McKeough (D-Illinois) and John Dingell (D-Michigan). “We went to tiny towns, like Enid, Oklahoma, and large cities,” Edelstein recalled. “We talked with state officials and city councils—or the city manager, or whoever would talk with us.” Tobin joined Edelstein in Chicago as he carried the campaign north, and back home Tobin contacted city officials in California, Massachusetts, and New York State, which were also represented on Ways and Means.32 Many of the local people did not know anything about the issue, or the likely impact of the Roosevelt plan on their tax problems, and they had to be persuaded to listen and then to send letters or telegrams to their Congressmen. “Tobin had tremendous energy,” Goldberg recalled, and his enthusiasm infected his staff in Manhattan and their allies across the country. They entered the fray with the impression that FDR was strongly in favor of the bill,

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and that the odds were against them; but they kept working through May and into June. “We put in hundred-hour weeks,” one of his aides recalled. “Tobin worked as hard as anyone, and he gave us opportunities to try out our own ideas, and he gave credit when one of us made a useful contribution,” another remarked. “Austin inspired great loyalty. We loved to work for him.”33 And their efforts paid off. Letters and telegrams and resolutions greeted Missouri’s Congressman Duncan and his colleagues from Virginia, North Carolina, Oklahoma, Illinois, and California, and other states represented on the Committee. When the hearings were held in late June and early July 1939, local and state officials were on hand too. During six days of testimony, three speakers defended the plan, and all of them were officials of the Administration. Another 46 spoke in opposition. A close reader of the hearings record could find hints that Roosevelt’s idea had some appeal in the country at large, but these were but tidbits in a feast of discontent. For example, FDR and his advisers could be heartened by the news from Earl Warren, California’s attorney general, that the governor of his state favored ending tax-exempt bonds; but Warren’s telegram went on to say: “However, all the port authorities, the League of California Municipalities, and the individual communities that have been in contact with me, seem to be unanimous in opposition.” Warren closed by stating that he too was opposed to the FDR plan.34 On July 13, two days after the hearings ended, Ways and Means voted to delay action on the president’s proposal. No further steps were taken in either the House or Senate during the summer and fall of 1939. However, looking to the possibility of action early in 1940, Roosevelt and his advisers could point to favorable omens. Although the Senate and House hearings conveyed a sense that there was widespread public opposition to ending tax-exempt bonds, a Gallup poll in 1939 carried a dramatically different message: 75 percent of those who responded endorsed the general approach in FDR’s plan, while only 25 percent were opposed. Newspaper editorials also favored ending exempt bonds: of 705 newspapers which took a position on the issue in 1939, 77 percent urged removing tax exemption at once by Congressional action; 14 percent favored such action via Constitutional Amendment; only 9 percent supported tax exemption as a continuing policy. Sensitive to the widespread opposition to government bonds which might permit the rich to evade their “fair share” of taxes, the Republican Program Committee also took up the cudgels in February 1940, arguing that “prompt consideration” should be

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given to eliminating “all tax exemption of future issues of federal, state, and municipal securities.”35 The campaign of the Conference on State Defense had, however, taken a considerable toll. Facing hundreds of well-placed local and state officials in opposition, led by the attorneys general from 45 states, neither the Senate nor House champions of the president’s scheme were anxious to bring the issue to a vote. With sentiment on his Special Committee split 4–2 in favor of ending exemption, Senator Prentiss Brown finally introduced a bill in September 1940, to eliminate tax exemption on future municipal bonds. In urging favorable action, Brown said that he hoped his fellow Senators would “not be overpowered by the very effective campaign which has been carried on by the attorneys general. . . .” His colleague Robert La Follette (R-Wisconsin), a strong proponent of ending tax exemption, observed that “this bill has been under more pressure than any important piece of legislation in all my legislative experience.”36 As the FDR bill headed for a vote in the Senate, the impact of the states’ campaign, and of Professor’s Lutz’s focus on local tax burdens, could be seen in the concerns of Senators who had not been involved in the Committee deliberations; and the bill’s champions found themselves underscoring those fears even as they argued that the overall tax impact would be beneficial— that a larger local tax bite would be accompanied by a smaller federal tax bill, so the average taxpayer would see a reduction overall. Thus when Senator Bailey of North Carolina expressed concern about Prentiss Brown’s tax bill, this colloquy emerged: Mr. Bailey. If we . . . impose interest upon its bonds, then we shall drive the people of North Carolina and the legislature thereof to impose higher taxes on my real estate, on my farm down there, on the mules of the farmer, and the crop on his land. Yet it is said this would be a good thing . . . that this scheme of things is relieving the poor man and vindicating him against the favors given to the rich. Mr. Brown. Certainly the State and Federal taxpayer, as one individual, pays his Federal and State taxes out of the same pocketbook. To his mind the total of those taxes is the important thing, whether it be a tax on real estate, an income tax, or a tax upon personal property. Mr. Bailey. This policy of taxing the credit of my city of Raleigh and my State of North Carolina would drive the city of Raleigh and the State of North Carolina into further real-estate taxes.

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To which Senator Brown, perhaps responding too hastily, answered: “Exactly.”37 On September 19, 1940, the Brown amendment to the pending Revenue Act was called for a vote—and the State Defense forces had cause to cheer. Only 30 senators endorsed his proposal, and 44 senators registered disapproval. For the present, at least, state and local bonds were free from the reach of federal tax agents. Describing the victory at a Port Authority board meeting a few days later, Julius Henry Cohen warned that the Administration and its allies might renew the assault when Congress reconvened early in 1941.38

FDR Appeals to the Courts for Help As Cohen predicted, the Administration did revive its legislative effort early in the new year. It began with an adroit move, introducing legislation that made all future bonds issued by the federal government fully taxable. With the strong backing of Treasury officials, that bill was quickly passed by the House and the Senate. Roosevelt’s allies urged that similar legislation be approved for municipal bonds, under the principle of equity: why should purchasers of federal securities be treated less favorably in tax terms than those who invested in state and local bonds? However, they quickly learned that the state and local coalition was still alert and influential. Congressional action remained an uncertain prospect.39 But Roosevelt and his advisers had another string to their taxing bow. Why not bypass Congress on this contentious issue and rely instead on a judiciary which had in recent years turned a friendly face to the Administration and its creative designs? Since 1937, the Supreme Court had reconsidered its traditional positions in several fields, and it might now be expected to read the 16th Amendment in the straightforward way that had long appealed to the president. A judicial strategy had been successful in stripping tax exemption from salaries paid to Port Authority employees in Gerhardt, paving the way to a complete victory in O’Keefe, which abolished forever the protected category of tax-exempt salaries. Now a similar strategy could be used for taxevading bonds.40 On March 14, 1941, Internal Revenue sent notices to Port Authority commissioner Alexander Shamberg, vice-chairman Howard Cullman, and five others who held Port Authority securities, demanding payment of back taxes. Treasury announced that it would use this test case in order to clarify the right of the national government to tax state and local bonds under the 16th

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Amendment. With Port Authority officials once again singled out as a target of Treasury attacks, some of those involved concluded that there was a personal element in the decision to go after Shamberg and Cullman. But there were other and better reasons for that action. First, the Administration’s legal experts still held the view that the Port Authority and other “public corporations” were more vulnerable than traditional government agencies, under the rule set forth in the 1905 South Carolina liquor store case. Second, the Port Authority was a worthy adversary; in view of Cohen’s reputation and the briefs which he and his staff had submitted on tax issues in the 1930s, the Administration could expect that the issue would be clearly framed and fully explored as the suit proceeded to the Supreme Court. If Treasury won, therefore, it could anticipate that the opinion would set a firm legal foundation; and building on that decision, if it favored Treasury, the Administration might then take on the wider concern, soon eliminating the entire category of tax-exempt.41 One of the Administration’s targets, Alexander Shamberg, was angered by this attempt to reverse what he viewed as settled law. As Cohen later recalled, “he was ready to fight.” While the other bondholders paid the back taxes under protest, Shamberg agreed to resist, and the case, then titled Commissioner of Internal Revenue v. Shamberg, was underway.42 Now Tobin and his staff developed a three-pronged strategy. First, they looked closely at Treasury’s experience in floating its new issues, which after late February 1941 carried no tax exemption, and they found that Treasury was now paying much higher rates of interest. Examining the new federal issues in late March, Tobin calculated that the net cost had already reached more than $1.6 million. That information was promptly sent out in a newsletter to more than a thousand state and local officials and members of Congress. This “federal experiment with taxable securities,” he argued, showed how burdensome it would be to local cities (and “the home owner and rent payer”) if municipal bonds were subjected to the same tax exposure. So the Administration’s attempt to take the initiative in reducing tax inequity was converted into evidence that dire consequences must follow from taxing any government bonds.43 Second, they continued to stir up opposition by meeting with influential groups. In March, Tobin conferred with leaders of the American Bar Association during their midwinter meeting in Chicago, and the ABA then passed a resolution which condemned the effort to tax municipal bonds without a constitutional amendment. A few weeks later, he spoke at the na-

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tional conference of county officials in Louisville, focusing on the increases in local tax rates that would be visited on their citizens if the Administration’s efforts were successful. The coalition’s chairman, Henry Epstein, was at hand when the National Tax Association met in St. Paul, where he argued that the Administration’s scheme would add “a further and unsupportable burden” on local taxpayers. And at the annual meeting of the Investment Bankers Association of America in early December 1941, Tobin was on the podium to warn the members that a federal tax on municipal bonds would give Washington control over local financing, and ultimately over local government.44 Tobin’s December address provided extensive reflections on the relationship between federalism and democracy, a concern which was central to his view of Roosevelt’s scheme. He began with a critique of “the classroom texts in economics” which “for many years” had attacked the immunity of municipal bonds. Those texts focused on the issue as though it were “simply a problem in abstract economics,” involving the “principles of progressive taxation.” Academic economists have examined the matter, Tobin argued, “as if their Universities had Departments of Economics but no Departments of History, or Philosophy or Government.” The real issues in the case, in his view, were the “pressing problems of federalism, local self-government, and the nature of the democratic process,” for if Congress imposed a tax on municipal bonds, “it has, inevitably, the power to control state and municipal financing.” And “without the independent control of its own financing, no government can continue as a free and independent state.”45 Drawing upon his training at Holy Cross, he reviewed the close relationship between local self-government and democracy as they had been explored in the writings of Plato and Aristotle, and experienced in Greek and Roman cities; and he noted that democracy in Rome was strangled when the emperors tightened supervision over localities, which “finally broke down the autonomy of local government.” Taking aim at the church he had left in discouragement, Tobin then drew upon his knowledge of the eleventh and twelfth centuries to argue that “the primitive democracy of the early Italian cities and the early church” had been “smothered in its turn by the successive centralizations” of power. In modern times, Tobin pointed out, Weimar had begun to nourish democracy by giving “large measures of self-government” to German cities; “the first swing of the Nazi axe” was aimed at that local vitality, with every city soon controlled from Berlin. Tobin also turned to the writings of Hamilton and Madison in The Federalist, and to the views expressed by Franklin Roosevelt and Charles Evans

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Hughes—when they were serving as state governors—to support the argument that centralization of governmental power would undermine political vitality and individual liberty. Then he cited a recent speech by an Administration official who argued that the tax system must be used not only to raise revenue but also to attain “social and economic objectives.” This was the danger, Tobin concluded; a federal tax on municipal bonds could be manipulated in order to exempt activities favored by the administration then in power, and to lay a heavy burden on those it did not endorse. In that event, the viability of a federal system, with its wide variety of programs and experiments, would be “wiped out,” and the country would be left with “an omnipotent national state.”46 To strengthen the case against Congressional action, Tobin sought the views of investment bankers who regularly entered the municipal bond market. He anticipated that their concerns would underscore the Conference arguments—that a federal tax would sharply raise the cost of borrowing, and that weaker governments might be blocked altogether from raising capital funds to improve their local schools, roads, and hospitals. Some of the investment bankers did underscore these fears, with special concern for smaller cities whose bonds might not find any buyers if they lost the tax-exempt feature. But other letters would have warmed the hearts of Treasury’s tax advocates, and it was evident that this effort did not generate the vigorous antitax response that Tobin and his aides had uncovered (and in part created) in their earlier campaign. This initiative was quietly dropped.47 The final prong of the Conference effort was its legal response to the Shamberg suit. During the spring of 1941, Tobin and Goldberg conferred with Cohen and developed a strategy to counter the Treasury attack. The defense would be based primarily on a distinction which Stone had used in marshaling majorities for his opinions in Gerhardt and O’Keefe—that a federal tax on income from municipal bonds would be a significant burden on the operations of state and local governments. However, the Port Authority’s brief would also need to respond to the Administration’s argument that public corporations were prime meat for federal taxing, since they were engaged in activities akin to private business. In challenging this view, the Authority again argued that all its works were “essential” governmental programs in pursuit of the goal of regional economic development. Finally, Tobin explored the essays and court opinions written by Justice Stone, whose role in these immunity cases had become crucial to the Supreme Court’s decisions, and he identified a line of defense which he thought “might be particularly appealing to Stone.” In this context as in his Congressional activities, Tobin

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demonstrated his ability to devise strategies that were focused on the values and incentives of his targeted audience.48 While Roosevelt’s aides hoped that Shamberg would provide a victory over tax-free bonds, they could not expect final approval in the courts until 1943 or 1944, and therefore they decided to try the Congressional route one more time. In the weeks before Congress reconvened in January, 1942, Treasury Secretary Morgenthau and the chairman of the House Ways and Means Committee agreed to insert a provision ending tax-exemption into the new revenue act. FDR and Morgenthau then spoke out publicly, with Morgenthau urging action to “close loopholes” which allowed wealthy individuals to avoid federal taxes; “it is high time,” he asserted, “to tax the income of state and municipal securities.”49 The new effort produced the predictable counter-fire, with Tobin, Epstein, and Mayor LaGuardia taking the lead, joined by representatives of state and municipal associations. In May 1942, the House Ways and Means Committee once again rejected the Administration proposal, and after a longer fight the Senate also defeated the plan. During 1942, it became clear that Tobin and his colleagues had won a solid political victory over Roosevelt and his aides. And FDR would soon find the judicial route, via Shamberg, closed off as well. Then the issue of tax-exempt securities would fade as a Roosevelt priority, and more than forty years would elapse before the Congress and the Supreme Court would finally take significant action to curb the tax insulation of state and local bonds.50 Meanwhile, in the Port Authority’s lair, the battle over tax exemption was largely supplanted in the early months of 1942 by another conflict—this one for the future of the agency itself.

From Drift to Divided Leadership These were exciting years in the Law Department, and especially in Austin Tobin’s domain. Julius Henry Cohen had been suffering from health problems for several years, and by the fall of 1941, when he turned 68, he was no longer very active. He gave plenty of leeway to his younger colleagues, however, and the group that worked with Tobin was filled with enthusiasm and committed to their boss. Most of their energies were devoted to battling the Roosevelt Administration and their allies in Congress, and a measure of effort was allotted to grappling with the Bush Terminal appeal, which, as noted earlier, was finally and successfully concluded in 1940.

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As we have seen, the main problem facing Tobin and his associates was that they were joined to a large organization that seemed to be going nowhere. Soon after the first tube of the Lincoln Tunnel had been completed, in December 1939, Ammann retired to enter private practice, and his famed engineering staff was largely disbanded. Meanwhile, the regional planners and other visionaries of the agency’s first years had been pushed off to one side, a small band with little influence in Billings Wilson’s operations department; and the agency’s commissioners were dominated by conservative banker Frank Ferguson. His preference, and the Port Authority’s ruling policy, was to “retire debt in all haste.” As historian Erwin Bard concluded, writing at the end of 1941, the bi-state agency sat passively “on dead center.”51 One candidate who inquired about a job at the Port Authority early in 1942 received much the same impression. It seemed to be doing “nothing more than collect tolls on various bridges and tunnels,” and the staff was headed by general manager John Ramsey, “a relaxed, elderly, avuncular man, sitting in semi-retirement.” At one point, she was interviewed by Austin Tobin; “bright guy,” she thought, “but he has no future in this place.”52 Yet there were some stirrings within the Port Authority’s ranks during the first two years of the new decade, and there were occasional challenges from outside as well, pressing the agency to do more. Truck traffic, for example, became a subject of increasing interest to the agency’s planners. Despite the Depression, freight carried by motorized vans had steadily expanded in the late 1930s, and by 1940 dozens of small truck terminals were operating in the region; the loading and unloading process, together with thousands of trips by small trucks to shops and factories, cluttered the highways and side streets, especially in Manhattan. In July 1940, Walter Hedden’s Bureau of Commerce completed a report on the congestion problem and suggested that “a union terminal or system of union terminals” might be constructed, perhaps by the Port Authority, in order to improve the efficiency of truck deliveries and reduce street congestion. The benefits which Hedden and his fellow planners had once hoped would flow from a series of inland terminals for rail traffic were now directed toward the burgeoning field of truck transport.53 Meanwhile, bus travel into Manhattan by commuters and shoppers had also increased sharply, with hundreds of buses arriving each day from New Jersey via the Port Authority’s Lincoln and Holland tunnels. Interstate buses lined the curbs near Greyhound’s 34th Street bus station and around smaller bus terminals scattered in midtown, and Mayor LaGuardia urged the Port agency to think about ways to remove the New Jersey buses from cluttered Manhattan streets. By the summer of 1940, Hedden’s planners were examin-

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ing the feasibility of building a union bus terminal on the west side of Manhattan, near the Lincoln Tunnel.54 The nudge to consider new projects which LaGuardia supplied in the summer of 1940 was followed by a much more aggressive statement out of Trenton a few months later. In response to complaints that Port Authority tolls were too high, a state legislative committee had begun an investigation early in 1940, and the committee completed its work in December. After listening to citizen groups which urged that bridge and tunnel tolls be reduced, and to Port Authority arguments that its bonded debt should first be paid off and then tolls reduced, the legislative leaders in effect rejected both approaches. The crucial question, the committee concluded, was whether the Port Authority should have a “static role”; if so, “the principal function of the Authority would simply be the retirement of debt incurred in connection with the present facilities.” The committee then rejected that view and argued instead that the Authority must be “a dynamic agency,” ready to initiate new projects “as the need for such facilities is indicated from time to time.”55 By the end of the year, General Manager Ramsey was ready to take at least a modest step to recast the Port Authority’s image. After enduring two decades of annual reports whose covers and contents were decidedly grey in tone, Ramsey turned to an imaginative member of Tobin’s legal team, Mortimer Edelstein, and asked him to take on the task of creating a distinctive annual report to mark the Port Authority’s 20th anniversary.56 Ramsey also asked Marion Sanders, a member of Hedden’s bureau who had public-relations talents, to join Edelstein, and the two developed an impressive publication. Published in the early spring of 1941, The Port of New York ran 95 pages and was filled with striking photographs, interesting maps and useful tables. In a concession to the Ferguson theme, one section emphasized the important of repaying the bond debt (the banker’s somber visage graced that page); and in another section, the railroad tunnel under New York Bay was endorsed, a measure of Walter Hedden’s abiding faith in the faltering rail system. But there were hints of newer projects as well—a bus terminal for Manhattan, and possibly an interstate rail transit system which would make several stops on both sides of the River.57 A few months later, Hedden and his planning staff prepared an internal document for circulation to the staff and commissioners, and this paper went much further—suggesting that the Port Authority should reclaim its 1920s role as active agent of reform. The Authority had been created as a “central unifying agency with broad powers to function aggressively in improving the port,” the planners argued. It should engage in regional planning, and in ad-

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dition “finance, construct and operate . . . needed improvements,” borrowing funds to carry out this “major duty.” The Port Authority might own and operate steamship and rail terminals, and “any other type of port facility, including passenger service.” It might finance and construct a “union market terminal or a suburban transit line”; and perhaps the region would be better served if the Port Authority operated those facilities as well.58 In this confidential document, the authors warned their fellow staff members that the Authority “dare not fail to grapple with the problems it was created to solve,” and that an effort to “shift its responsibility to others” risked losing control to “agencies with greater initiative.” In a striking contrast to Ferguson’s caution, the report asserted: There is no room for misgivings because a venture appears new, unconventional or involves some degree of risk. There is a point where caution has the appearance of inertia; where conservatism can be mistaken for ineptitude; and where inaction can be interpreted as evasion of . . . public duty. Clearly the Port Authority has ample power and direction to proceed. (p. 15) The planners then argued that the agency presently had the financial capacity to construct two new union freight terminals in New York City, and marine terminals in Jersey City and Hoboken, and that it could add other projects, which might run deficits, by asking for “a substantial contribution” from those local governments which had “the power to tax.” (pp. 15–16) Through the end of 1941 and into the early months of 1942, these aspirations for expanded duties were but a minority view, nourished in the Bureau of Commerce, resonating with Edelstein and a few others outside the planning unit, and probably receiving encouragement from a few commissioners. The agency’s dominant profile remained, however, the abiding concern with paying off the debt, while operating the bridges and tunnels with brisk efficiency. Reinforcing that image, the commissioners re-elected Ferguson as chairman in January, 1942; it would be his ninth consecutive year in that executive office. The commissioners also announced that John Ramsey would continue to serve as General Manager, the top-ranking staff post; he had held that position since 1926.59 Then, a few weeks after the board meeting, John Ramsey announced that he wanted to retire. The Port Authority had been operating under tight financial constraints for more than ten years, and with World War Two now underway, gasoline rationing would soon be in force. Traffic would probably

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decline again, and more Authority staff members might have to be laid off. As one associate recalls, “Ramsey really didn’t want to tackle a whole new round of problems.” He looked forward to going back to Kentucky, where he had a farm, as soon as a successor could be chosen by the Board.60 But who should replace him? The Board appears to have been sharply divided. One group of commissioners, led by Frank Ferguson,wanted a top staff officer who would exert strong managerial control—reducing expenses while ensuring that the bridges and tunnels were maintained in good repair. Overall policy would continue to be set by Ferguson and his colleagues, with excess revenues used to pay off the bonds. Their candidate to replace Ramsey was Billings Wilson, Assistant General Manager for Operations. After graduating from Yale and spending three years as a U.S. Army officer, Wilson had joined the Port Authority’s staff in 1922 and risen quickly; he had now been one of Ramsey’s top aides for fifteen years. Wilson ran the Operations Department in an energetic, military style; looking ahead to years of reduced wartime travel, when toll revenues might be expected to decline, his reputation for efficiency generated confidence that he could be relied upon to squeeze out unnecessary costs. From the staff perspective, Wilson was seen as the most likely choice, but not an attractive one, because of his autocratic demeanor. He was, as one of his subordinates later recalled, “more feared than loved.”61 To another group of commissioners, Ramsey’s departure offered an opportunity to break free from the cautious approach of the previous decade. What was needed, from this perspective, was an executive team which would look ahead to the economic challenges and opportunities facing the New York metropolis once the war was over. The new staff director and his aides should identify projects that the Port Authority might undertake to aid the region’s economic growth, and then they would develop strategies to gain wide public acceptance for the Authority’s plans. This faction was led by Howard Cullman and Joseph Byrne. Cullman was a member of a wealthy family who had decided on public service rather than a business career, and he had been an active fund-raiser for the Democratic Party in New York since the early 1920s. Cullman had worked with Al Smith when Smith was governor, and he had welcomed appointment to the Port Authority board in 1927 as a way to help to maintain New York’s role as a vital commercial center. In the early 1930s, he had taken a leading role in pressing for construction of the first inland terminal, and he looked forward to other projects that might advance the cause of civic betterment. But the 1930s was a slow period at the Port agency, and Cullman found the cautious approach of Ferguson and his allies uncongenial. Byrne, a New Jersey Com-

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missioner since 1934, was an elected member of Newark’s governing body and, in the early 1940s, director of the city’s Department of Public Works. Byrne was alert to the possible benefits that a reinvigorated Port Authority might bring to his own city’s commercial vitality.62 From this perspective, Walter Hedden was an attractive candidate to succeed Ramsey. After attending Williams College and obtaining graduate training in economics, Hedden had joined the Port Authority staff in 1923, and within a few years he had risen to the top planning position; since the early 1930s, his title had been Chief of the Bureau of Commerce. Hedden had an incisive and wide-ranging mind, he worked long hours, and he was known to be frustrated by the banker’s caution that pervaded much of the agency. In Hedden’s opinion, the New York region needed to “gear up” to meet the transportation challenges that the war would bring, and that would continue after the war ended, and he thought the Port Authority ought to take a leading role in this regional effort. The July 1941 staff document displayed Hedden’s views and suggested his impatience. Then, in the summer of 1941, the Port Authority took the lead in creating the Metropolitan Defense Transport Committee, which would respond to the growing threat of war by organizing defense preparations for the tri-state region. Hedden was appointed to chair the regional subcommittee on food supplies. As a result, he emerged from the obscure position that his boss, Billings Wilson, assigned to the Bureau of Commerce, and he began to appear at Board meetings to discuss regional issues and strategies. Hedden soon emerged as a contender for the top staff post, in competition with Wilson.63 When staff members—in planning, in law, and in operations—learned that John Ramsey was planning to retire, they identified Wilson as his likely successor, and Hedden as an alternative, if the board wanted new ideas more than it wanted spit-and-polish efficiency. And they learned also that the commissioners were becoming impatient with Julius Henry Cohen—the intellectual creator of the agency; once the master strategist, but now a man in poor health who sometimes rambled at board meetings, and whose egotism seemed a match for his grasp of issues legal and political. So the mill of conjecture turned to candidates for General Counsel as well, and here Leander Shelley was the probable winner. His important work on the bond refunding problem in the 1930s, his position as solid adviser to Cohen on legal distinctions, and his predictable behavior on all matters seemed to fit the agency’s dominant style. To Goldberg and others who had worked on the tax fight, Tobin also seemed a possible candidate for General Counsel, but he was ten years Shelley’s junior and lacked his sustained experience as legal craftsman.64

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When Tobin considered his own future, in the spring of 1942, he doubted that he would stay with the Port Authority if Shelley were chosen to succeed Cohen. Based on discussions with Edelstein and from his own encounters with that meticulous intelligence, he knew that working under Shelley would be a cramped experience. Meanwhile, with the United States now at war, Tobin began to think seriously about military service, and early in 1942 he applied to the U.S. Navy for a commission.65 Within the board, Tobin was seen by Cullman and Byrne as an attractive alternative to Wilson and Hedden. They liked the young man’s style, his enthusiasm and his capacity to develop a dedicated and able staff, and his ability to devise and carry out complex strategies in the political arena. It seems likely that Ramsey also urged the board to consider Tobin, whom he thought had done a fine job in the anti-Treasury campaign. Through his work on tax-exempt bonds, Tobin was known and well regarded among government officials in both states and in the investment community, and this was an added benefit.66 He lacked the intensive immersion in administrative duties which was central to Wilson’s life, but that would not be a significant problem if Wilson could be persuaded to stay on as head of operations. Tobin also lacked the wide experience in regional and project planning which Hedden offered, but he far outdistanced Hedden in his experience in devising political and legal strategies to overcome obstacles and implement new ideas. Here again, if Hedden stayed and was brought closer to the executive office, the mix of strengths—Tobin plus Hedden— might work well. By early April, Wilson and Tobin had emerged as the main contenders, and the lines of battle were sharply drawn. Then Tobin gained support of a majority of the board; and Ferguson, who had been championing Wilson, suddenly threw his own hat into the ring, offering to resign his bank presidency and take on the full-time executive post at the Port Authority. But Ferguson was rebuffed, and the majority held firm for Tobin. Ferguson retreated to his Jersey City bank, nursing his wounds and waiting for the time—soon to come—when he could use the power of the Chairman’s post to shackle this upstart, or force him out.67 When Tobin was called in by the board and informed that the commissioners had agreed to name him as John Ramsey’s successor, it was, by all accounts, a surprise to Tobin and astonishing to his family and close associates. “It was a shock to me,” Goldberg recalled. In consultation with Tobin, the board then had to construct the rest of the team that would work under him, and by the end of May that complex task was completed.68

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On June 4, 1942, the Port Authority announced that Austin Tobin had been chosen as Ramsey’s successor—the title now being Executive Director of the agency. The announcement was far from a ringing endorsement of the Cullman-Byrne philosophy, however, for it emphasized the need for “retrenchment” and “managerial caution” in the face of “potential declining revenues.” So the entrepreneurs conceded the initial public-relations victory to the conservative cause. In return, Ferguson and his allies agreed to announce that Tobin was the “unanimous choice” of the Board. Cohen’s retirement was also announced, and Leander Shelley would succeed him as General Counsel.69 In addition, the commissioners approved one other important change: the Bureau of Commerce was set free from Billings Wilson’s tight managerial control and retitled as an independent Department of Port Development, which reported to Tobin; and Hedden was named to direct the new department. When he heard the news, Wilson swallowed his disappointment, went to Tobin’s office to offer congratulations, and agreed to stay on as Director of the Operations Department, ensuring that the bridges and tunnels would “run on time” while Tobin and Hedden explored new opportunities and new projects.70 The significance of these changes seemed lost on a sleepy metropolitan press, which wrote not a word of the conflict in philosophies or the battle that preceded the change in regime. Its meaning was clear, however, to perceptive members of the Authority staff. As David McKay, a senior official at the agency, commented to a colleague on hearing the news: “Now we’re going to see things zing!”

Democracy, Federalism, and the Freedom to Experiment It would be some years before the real impact of the board’s decision in favor of Austin Tobin could be seen. Until early 1945, the primary executive power would stay with Frank Ferguson; during those years, a mixture of fiscal conservatism and old-fashioned anti-Semitism would block Tobin’s initiatives and force one of his key aides from office. And not until 1947 would the Port Authority begin to take on major new duties—airports, marine terminals, and other projects—at last meeting the standards for aggressive action suggested by New Jersey legislators and the Hedden reports in 1940–41. Those developments are discussed in the next chapter. In the paragraphs below, we explore the main themes illustrated by the extensive conflicts and modest victories that marked the years between 1931 and 1942.

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First, it is important to underscore the signal contribution of the Law Department in encouraging a sense of playful experimentation and in maintaining the Port Authority’s distinctive values, through a decade in which those patterns of thought and action found little encouragement elsewhere in the agency. During the 1930s, the imaginative thinking and political coalition-building which had marked the Authority’s first ten years seemed to depart from the executive offices and most of the agency’s divisions—casualties of external forces and of leaders who preferred stability in goals and efficiency in execution to forays into uncertain waters. But the legal branch retained much of the older entrepreneurial spirit, encouraged by Cohen even as he became personally less active in the division’s work. One might argue, perhaps, that the Port Authority’s efforts to grapple with legal issues involved in tax immunity, and to organize political alliances in defense of immunity, were simply the result of external challenge—a necessary response to the gauntlet thrown down again and again by FDR and his allies in Treasury. But that undervalues, I think, the tone of legal and political innovation which marked the Authority’s responses through these years. In his heyday, from about 1910 through the early 1930s, Cohen had demonstrated unusual talents in matters both legal and political, and men of similar inclination had been attracted to his team. With his distinctive personal history, Tobin could readily respond to Cohen’s career as a model, salting in his own style in challenging authority and his considerable abilities in organizing men as well as legal principles. A “moonshine reveller” in his years at Holy Cross, a spittoon thrower at the Port agency, Tobin demonstrated that he could convert even humdrum cases of real-estate condemnation into lively challenges to the intellect. Making good use of the freedom Cohen encouraged, Tobin employed a playful approach in his relations with his colleagues and in thinking about how to beat Roosevelt at his own political game.71 Of course Tobin and his aides faced an opponent whose own inclinations were also distinctly playful and intellectually complex, as illustrated in Roosevelt’s expression of “sympathy” for those who would be required to pay back taxes after Gerhardt was decided in his favor. Possibly both sides were strengthened by this nine-year battle: FDR’s financial and legal teams were kept on their toes as they sought new revenue, while the contest nourished a vital spark—otherwise failing—at the Port Authority. Certainly the bi-state agency benefited from the challenge Roosevelt and his aides laid down from 1933 into the 1940s, though this was probably a benefit unintended by the

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president. Or was it entirely unintended? In 1931, Roosevelt had argued that the Port Authority’s leaders and its policies were “charting the course toward the more able and honorable administration of affairs of government,” and in 1933 he had used that agency as a partial model in creating TVA. Why should he not, in some deeper crevices of his mind, see the advantage of intellectual and political combat in keeping his once-favored government body alert and able to entertain new ideas?72 So, during these years, the Law Department protected some of the Port Authority’s distinctive values. Meanwhile, Hedden and his assistants kept alive in the peripheral offices of the Bureau of Commerce the weakened spirit of regional planning and action, until they could find allies in the new decade in Mayor LaGuardia and the New Jersey legislative committee. And until they could join forces with Tobin and his associates from the legal division in the summer of ’42. Another theme illustrated in this story comes in two parts: First, the dangers to a vigorous federal system of government, to social experimentation, and perhaps to individual liberty which are presented by the forces which press—especially in modern society—for centralized control in the name of national efficiency, or social equity. And second, the important role which the Port Authority undertook in the 1930s in leading resistance to that centralizing tendency out of Washington. As Tobin pointed out in his speeches and in Conference newsletters, the pressures to centralize governmental power have challenged cities and other semi-independent public bodies since the Greco-Roman era, throughout the Medieval period, and conspicuously, in the 1930s, in Hitler’s actions which stripped local governments of any independent power. In the United States, the Port Authority stood as a visible example of the benefits that could flow if states and urban regions were permitted to try differing approaches to organizing and using the powers of government, insulated from the controlling hand of Washington. Certainly this had been FDR’s view, when he sat as governor of New York State and applauded the important projects of this bistate agency and the effective execution of its plans. In the United States, the danger of centralized authority emanated not only from the executive and the Congress, but also from a Supreme Court which could block state and local forays in new directions. The importance of releasing state energies from oppressive central control had been expressed forcefully by Brandeis in 1932, when the Court majority rejected a new initiative by the state of Oklahoma. In dissent, Brandeis wrote:

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It is one of the happy incidents of the federal system that a single courageous state may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country. This Court has the power to prevent an experiment. . . . But . . . we must be ever on our guard, lest we erect our prejudices into legal principles.

Cohen had responded to the Oklahoma case, endorsing Brandeis’s argument and urging Congress to pass new laws to protect the right of states to experiment.73 However, when Roosevelt and his Treasury associates took aim at municipal bonds, Tobin and his associates then turned to the courts as an important line of defense for state and local initiatives. Ending tax exemption might raise financing costs by 25 percent or more, they argued, and that would prevent cities and towns from floating bonds for many projects that were financially marginal. Of course the federal government might still permit tax exemption for selective types of bond issues; in that way, Tobin pointed out, the tax power could be used as a weapon “to impose the social and economic objectives of those in control of the national government upon every state and city in the country.”74 Treasury’s judicial strategy—using the Shamberg case to break the back of tax-exempt bonds—was in its early stages when Tobin was named executive director, but he and the Port Authority team continued to work on the case, and two years later they were rewarded with an important if partial victory. In August 1944, the Court of Appeals agreed with the bi-state agency that its securities were protected from federal taxes by Congressional Revenue Acts. The victory was only partial in that the court rooted its decision in federal laws, not in the basic protections of the U.S. Constitution. However, in January 1945, when the Supreme Court announced that it had denied Treasury’s appeal in the case, Tobin and his associates in the national coalition could leave the field of battle, assured that FDR’s initiatives had been defeated. The right of state and local governments to issue bonds for whatever purposes they thought desirable—unburdened by the federal taxing power—was still protected.75 The third point underscored in chapters 9 and 10 is the crucial importance of grass-roots political activity, in safeguarding the ability of state and local governments to finance new initiatives and other programs by issuing bonds. The grass-roots theme was illustrated forcefully by the efforts of Tobin and his aides in 1938 and 1939, and this campaign then provided the intellectual and political nourishment for continuing efforts to defend municipal

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bonds during the next forty years. That subsequent history can be summarized briefly. Although defeated in the courts, in the postwar years Treasury and its allies continued to press for Congressional action to strip away tax exemption; and the Conference on State Defense stayed on the alert, with Daniel Goldberg holding a key position, through the 1940s and into the 1950s. In 1949, for example, opponents of tax exemption attempted to eliminate exempt bonds by attaching an amendment to pending housing legislation, and Goldberg teamed up with the Conference of Mayors to block that effort. The next year, a spokesman from the business community took the lead in attacking tax-exempt bonds, and Tobin and his allies quickly responded with a series of counter-attacks. By the 1960s, the task of defending municipal bonds had passed to the Government Finance Officers Association (GFOA), and Goldberg and other Port Authority staff members continued to hold central roles in that effort. Their work was made more difficult when local governments stretched the opportunity to experiment too far, issuing large amounts of “industrial development bonds” to attract or keep private corporations in their cities, and passing on to those private firms the benefit of tax-exempt low interest rates. When Congress passed legislation to restrict that practice, Treasury saw an opportunity to sweep away all tax-exempt bonds; and a coalition of national groups, reminiscent of the 1938–39 coalition, emerged again in political strength, frustrating Treasury’s hopes.76 During the 1970s, city and state use of tax-exempt bonds expanded further, and Treasury argued that these bonds were being used to avoid estate and gift taxes. Congress responded with a new law in 1982 which limited tax-exemption to bonds whose ownership could be monitored, through registration. State and local interests saw this as another effort to undermine the municipal bond market and sued, and Goldberg emerged from retirement to work on one of the briefs.77 But the result was, from a legal perspective, a stunning defeat for the states. In a decision handed down in 1988, the Supreme Court not only upheld the registration requirement but reached further, concluding that the U.S. Constitution provides no protection to municipal bonds; if Congress and the president wish to eliminate tax-exempt bonds, they are free to do so. The lone dissent, by Justice O’Connor, echoed the fears expressed by state and local interests through half a century of successful defense: The Court shirks its responsibility because it fails to inquire into the substantial adverse effects on state and local governments that would follow from federal taxation of the interest on state and local bonds. . . . If Con-

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gress may tax the interest paid on state and local bonds, it may strike at the very heart of state and local government activities.78

A stunning defeat in legal terms, but from another perspective just the stimulus needed to remind the states and cities that their best defense lies not in judicial analysis but in the political process. The Court opinion points in that direction. And that decision “galvanized state and local government” to become more active politically, led to the creation of a special national commission which endorsed tax exemption, and resulted in the creation of a new version of the Conference on State Defense, now called the Public Finance Network, to “coordinate the efforts, on a grass-roots basis, of all of the public interest groups” working to keep broad Congressional support for tax-exempt bonds. The political lessons that can be drawn from the campaign which defeated Roosevelt in the 1930s still apply, and perhaps with even more relevance now that the Constitutional argument of Pollock has gone to its grave.79

Part Four

Expanding Empire

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11 To Claim the Skies and the Seas

The Golden Age lies ahead of us not behind us. Everywhere new possibilities beckon and arouse courage and effort. . . . Man is capable, if he will but exercise the required courage, intelligence and effort, of shaping his own fate. —John Dewey1

There is nothing more difficult to execute, nor more dubious of success . . . than to introduce a new system of things: for he who introduces it has all those who profit from the old system as his enemies, and he has only lukewarm allies in all those who might profit from the new. —Niccolò Machiavelli2

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ow it is July 1942. John Ramsey has departed for his farm in Kentucky. Julius Henry Cohen is on the sidelines, serving occasionally as a consultant. Austin Tobin, the surprise choice of the Board of Commissioners, has just been installed as executive director. There he would stay for the next 30 years—through the administrations of six Presidents, four governors in New York State, and five chief executives in New Jersey—until the battles with Governors Cahill and Rockefeller led at last to his abrupt decision to retire in December 1971. The task of part four is to describe and analyze the first eight years of this extraordinary reign. These were crucial years—when the Port Authority expanded from a bridge-and-tunnel agency to embrace a wide range of new goals and projects, including three major airports, a massive bus terminal in Manhattan, and its first important marine facility, at Port Newark. During this period, as he searched for new tasks and marshaled the staff to take on new burdens, Tobin also transformed the agency from a loosely connected organization, somewhat adrift, into a coherent institution with 247

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a clear sense of mission and a staff dedicated to that mission and loyal to the new leader.3 To bring about these changes, Tobin needed the optimism of John Dewey wedded to the strategic skills of a Machiavellian. Within the bi-state agency, he was opposed in the early years by a powerful executive, the Authority’s chairman, whose hostility, laced with anti-Semitism, he was forced to abide and circumvent, until Fortune combined with adroit maneuver to cast that enemy out. Beyond the agency, Tobin’s expansive plans also faced resistance—from elected officials in New York City and Newark, from influential state legislators in Albany and Trenton, and from Robert Moses and his allies. To overcome these opponents, he had to construct a regional coalition which included planning and economic experts, important business and government officials, and influential newspaper editors and reporters. Moreover, in order to ensure the viability of his newly acquired airports, he was prompted to take the lead in creating a national coalition to break the monopoly power of the airlines. And, facing the need to displace those who lived near the bus-terminal site, Tobin and his aides met the challenge by creating relocation policies that weighed the rights of the dispossessed against “development efficiency.” In chapters 11, 12 and 13, we examine an array of questions regarding the challenges, obstacles, and strategies seen in these crucial years of Tobin’s leadership. How did Tobin and his associates identify new directions for the agency? What strategies did they use to gather support for their preferred choices, and how did they anticipate and neutralize possible criticism? When opposition had to be met openly, what tactics were used and with what effect? What steps did Tobin and his aides take to enhance the agency’s technical expertise, to motivate his expanding staff, and to overcome the tendency toward fragmentation and conflicting goals within the agency? What factors were most important in determining success and failure of the Port Authority’s new initiatives?4 In the course of exploring Austin Tobin’s leadership strategies and style during these years of transformation, we will inevitably touch on portions of his “inner life”—his personal values, motivations, hopes, and biases. In particular, we will want to consider how well Tobin fits Schumpeter’s suggested personality profile for the entrepreneur—whose actions are shaped by “the impulse to fight . . . the will to conquer,” by the “joy of creating, of getting things done” and, perhaps, by “the dream and the will to found a private kingdom.” In exploring these various issues, we can also cast some wider light on the nature of “entrepreneurial leadership” in public life.5

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Reviving the Entrepreneurial Spirit Let us resolve to sin no more. —Austin Tobin, urging the staff to read Erwin Bard’s book, fall 1942.

When Erwin Bard was completing his major study of the Port Authority in 1941, he saw little sense of creative energy at the top of the agency. Working in an office next to that celebrated legal visionary, Julius Henry Cohen, Bard found him inclined to talk mainly about challenges and achievements of the past. Cohen had suffered a heart attack several years earlier, and his modest work schedule was combined with a long nap each afternoon. Ramsey appeared no more inclined to seek new challenges. “The Port Authority seems to have become frightened by the specter of controversy,” Bard concluded. Its policy had become “totally receptive rather than aggressive” in confronting the region’s transportation and port commerce problems.6 The Port Authority’s announcement in June 1942 that Austin Tobin would succeed John Ramsey as the top staff official was surrounded with warnings of declining tolls at the agency’s bridges and tunnels, and of the need for “retrenchment” and “managerial caution” at the beleaguered agency. By early July, however, Tobin had found his own voice, as he reminded the staff that the Port Authority had in its first twenty years “bested one crisis after another.” With “your trust and confidence,” he commented, “we will take the war in stride and set our sights for the great part which the Port Authority will play in the post-war development of the Port of New York.”7 Until he was chosen to be executive director, Tobin had been absorbed in matters of law and politics. He had devoted little attention to the transportation or economic-development problems facing the New York region, or to the possible initiatives which the Port agency might take in meeting those challenges. During the summer and fall of 1942, Tobin spent long hours reading about these issues, and he gathered about him staff members who could help devise strategies to respond to regional needs. From the Law Department he brought a key associate, Mortimer Edelstein, to the front office. Edelstein had been a leading member of the team which battled FDR in the tax-exempt bond fight, and he had also co-authored the Port Authority’s 1940 annual report, which described in dramatic form the region’s challenges and identified several projects the Port Authority might undertake. A central role was given to Walter Hedden, who had been freed from Billings Wilson’s yoke and named director of the new Department of Port Develop-

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ment. In the months to follow, Hedden worked closely with Tobin in developing plans for the postwar era.8 During the fall, Tobin read Bard’s newly published volume on the Port agency’s achievements and failings, and he then sent copies to the senior staff with a cover note: This book is a must! It is no sugary review of our progress, rather it will prick you with the barb of criticism. However, it is a healthy thing to see ourselves as an unprejudiced scholar found us and to have him opening long-forgotten doors in search of the family skeleton. After all, it profits us very little to be told how well the job was done. Rather, let us resolve to sin no more.9

By mid-November, Hedden was able to circulate to his colleagues a confidential memorandum which sketched out a postwar program the Port Authority might aim to achieve, through its own actions and in cooperation with other agencies and groups; expanded rail transit, air cargo terminals, more regional highways, and the mainstays of the Comprehensive Plan— union rail terminals and the cross-bay tunnel—were all included.10 A few weeks later Edelstein spoke out publicly, challenging the conservative perspective which had shaped his agency’s culture under Ferguson and Ramsey. Addressing a meeting at the Cornell Law School, Edelstein warned that the Port of New York Authority and other public authorities faced the danger of “hardening of the administrative and financial arteries.” If his own agency adopted as its sole function “the collection and disbursement of revenues,” it would “fail . . . to justify its existence.” Moreover, Edelstein argued, neither the Port of New York Authority nor other public authorities which can stand on their “own financial feet” should limit their activities to projects which individually will be certain to pay their own way. Instead, “a broader concept of economic self-sufficiency can be substituted,” placing “all of the Port Authority credit and resources” behind a project that might not pay its own way but is needed “in the public interest.” Unless this perspective is embraced, Edelstein concluded, and the public authority is willing to add functions “to meet the changing needs of all of our people,” the authority “has no justification.”11 Edelstein’s comments provide some sense of the aggressive approach, threaded with a readiness to take risks, which Tobin encouraged within the staff in his first few months in office. By early spring of 1943, Tobin had also convinced the Port Authority Board to take a forward-looking position. In

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their annual report to the governors and legislatures of New Jersey and New York, the Commissioners first pointed out that the Authority was “in a period of severely declining revenues and curtailed expenditures.” Even so, they urged that “prompt and constructive measures” be taken to meet the competitive challenge from other regions. The Port “must plan now,” their letter of transmittal stated, for the development of airports and efficient marine terminal facilities in the postwar world. “It is not too early,” they concluded, “to shape joint plans and a common approach” to the region’s trade and transport problems.12

New Goals for an Aging Enterprise Early in the summer of 1943, Tobin and Hedden completed a confidential 40-page report which outlined their own philosophy for regional action. One of the Port Authority’s primary responsibilities in the postwar world, they argued, would be to “channel and harness” the new forces of technology and transport organization so that the Port area would maintain its position as “the gateway for world commerce.” The report then listed a number of projects which were “proposed for possible financing, construction and operation by the Port Authority.” These included a large union bus terminal in Manhattan (a project initially studied by the agency in 1939–40), truck terminals in both states (also the subject of earlier studies), and bulk commodity and produce terminals.13 In addition, the Tobin/Hedden report described initiatives the Port Authority itself might take in the fields of air and marine transport. “An extensive system of air terminals will be needed,” they argued; the combination of Newark and LaGuardia airports, plus the new [Idlewild] airport planned by New York City, would still “not be adequate” to meet the postwar air cargo and passenger demands. So the Port Authority “must be prepared to assist municipalities” in planning and developing airfields; such assistance might include “financing, construction and operation by the Port Authority” of an array of airports in New Jersey.14 The 1943 paper also suggested that the Port Authority take an active part in maintaining shipping as a vital commercial enterprise in the New York region. The agency could, for example, analyze property costs “at several sites on the New Jersey waterfront” which might become “available for lease or purchase by the Port Authority after the war.”15 The June 1943 report was only slightly more cautious than Edelstein’s speech regarding the issue of economic practicality. Perhaps each of the pro-

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posed projects could become financially self-supporting, and this question should be carefully explored, the authors argued. However, where a deficit operation seemed likely, the Port Authority would examine what financial assistance would be required—from the federal government or other sources— to permit a needed project to go forward.16 Once the planning report was completed, Tobin and his aides turned to the tasks of evaluating each program area in greater depth, and of winning regional acceptance for any projects the Port Authority itself decided to undertake. Tobin knew that he would probably face difficult political challenges from New York City’s mayor and other officials, and he soon found that he faced a wrenching battle within his own agency as well.17 The first step was to gain approval by the Board of Commissioners for the general approach taken in the June report, and for the hiring of economists, engineers, and other specialists to carry out the detailed evaluations needed in each project area. In addition, an active public relations program would be required. The agency would need to develop close rapport with reporters, and with editorial writers and other opinion leaders throughout the region, in order to gain their support for the Port Authority’s plans. “We’re getting terrible publicity,” Tobin commented to an associate at the time, “especially in New Jersey. It gets worse and worse.” Press relations were in the hands of Larry Keefe, a former newspaper reporter who had joined the Port Authority in the 1920s, and by the late 1930s he showed little imagination or energy; senior officials had been trying to get rid of him for years.18 The approach that Tobin and his aides would take in two areas—motor truck terminals and a proposed interstate bus terminal in Manhattan— seemed straightforward. Both had been identified publicly as appropriate fields for Port Authority action, and no competing government initiatives existed. Locational and economic studies were required, and New York City would have to agree to new regulations regarding bus movements in Manhattan, but in 1943 these steps seemed to raise no real hurdles. Later, Robert Moses would attempt to block the bus project, but at this point he was counted as a friend of Tobin’s plans for expansion.19 Airport and seaport operations raised more difficult issues. The region’s two largest cities each owned a major air terminal (LaGuardia in northern Queens, and Newark Airport situated near Newark’s marshes and harbor); moreover, New York City had identified an area in southern Queens where it planned to create a vast new airport (Idlewild, now Kennedy Airport). Newark also had a substantial city-owned marine terminal, and New York City

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11-1. Engines of economic growth? On the New York side of the region, Tobin and his aides studied LaGuardia and Idlewild airports, and the shipping piers along the Manhattan and Brooklyn shores. West of the Hudson, Newark’s airport and seaport, and Hoboken’s piers, attracted their close attention.

was a major owner and developer of pier facilities along the Manhattan and Brooklyn waterfront. To the mayors and other civic leaders in the two cities, these sea and air terminals were symbols of municipal independence and civic pride, as well as potential engines of postwar economic growth. In addition, the marine terminals on both sides of the Hudson provided hundreds

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of patronage jobs for loyal party workers, and local officials looked forward to construction contracts and job expansion at these transport terminals as a route to strengthening party fortunes. From the perspective of the Port Authority’s leaders, however, these municipal facilities were a source more of consternation than of pride. Neither city had allocated enough funds in the past two decades to maintain their harbor facilities in good repair, and the patronage system had not attracted a band of energetic and efficient workers and supervisors. Moreover, the postwar world would surely require large investments in technological improvements in marine facilities, and great expansion of the region’s airport system. Yet Newark and New York City faced growing pressures for major capital investments in schools, hospitals and other projects, and with those needs added to existing indebtedness, it seemed unlikely to Tobin and Hedden that either city would be able to dedicate the funds required for modern, efficient air and harbor facilities. And even if adequate funds were made available, could these municipal governments be expected to replace patronage with merit in hiring workers, and could they attract and hold the kind of managerial talent needed to make these air and marine terminals vigorous competitors in the world market? To Tobin and his colleagues, and to other close observers and officials, those changes seemed both revolutionary and unlikely.20 Finally, even if these two cities had possessed the funds and managerial talent to meet the postwar challenge aggressively, history suggested that they would employ their energies in trying to divert traffic from each other, rather than developing cooperative plans which would strengthen the overall quality and efficiency of the bi-state Port region. The same narrow perspective appeared likely to animate smaller cities, such as Hoboken, which owned portions of the region’s waterfront. Certainly the previous decades had seen competitive antagonism among the region’s cities; that tradition seemed destined to continue as long as municipal control held sway.21 However, if detailed economic studies showed that modernized airports and marine terminals in the region could be developed and operated on a self-supporting basis, one possible solution to this problem and to the region’s needs seemed reasonably clear: the Port Authority itself could take on the task. Indeed, there was no other public agency which extended across the bistate metropolis and which had the potential funds to develop air and marine facilities on an integrated basis. Perhaps these terminals would not be fully self-supporting during the next decade or two; even then, a federal grant might allow the Port Authority to operate the terminals on a nearly breakeven basis, and the Authority’s own growing reserves could be used to meet

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a modest deficiency in operating and capital funds. Thus the “Edelstein principle” might be employed to help strengthen the region’s transport system and its economy. In addressing the issue of airport and seaport improvements, Tobin and his associates realized that a carefully crafted political and public-relations strategy would be crucial. Even if widely accepted planning standards, bolstered by careful economic analysis, offered convincing evidence of the advantages of Port Authority operation, the bi-state agency could not simply ask New York City and Newark to hand over their terminals. Such a request would expose the agency to vigorous attack from city elected officials, political party leaders, and others who benefited—or who thought their individual cities benefited—from city ownership and policy control. The attitude of New York’s Mayor LaGuardia was likely to be especially antagonistic to a Port Authority takeover.22 Instead, the request would have to come the other way—from local leaders persuaded that the most sensible solution, from the viewpoint of their own city and the wider region, was to rely on the Port Authority to modernize and operate their major airports and seaports. To nudge wary officials of Newark and New York City to make such a request would require an extensive campaign of education. The effort might begin with informal discussions which would bring newspaper editors, local business leaders and civic organizations to see the merit of the Authority’s perspective on the problem; and their energies could then be enlisted to persuade city commissioners and mayors to set aside their parochial inclinations and embrace a regional solution. Meanwhile, Tobin and his aides could also develop and publicize the agency’s expertise in general air-traffic planning, and argue publicly that modern air and sea terminals would be needed to aid economic growth. But they would avoid any direct actions that might suggest the Port Authority was anxious to swallow those piers and airfields which generated such municipal pride and patronage. To carry forward these efforts, particularly the crucial work of establishing close contacts with newspaper editors and reporters, the work of a skilled practitioner in public relations seemed essential.

The Chairman Dissents, and Departs With the June 1943 report in hand, Tobin and Hedden applied to the Board for approval of the next two steps—creation of a Port Planning Program,

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which would involve detailed locational and economic-feasibility studies of the several projects; and the appointment of a new director of public relations, to replace the long-time press aide, who had finally retired. For the latter position, Tobin recommended Marion K. Sanders, a member of Hedden’s staff who had held important posts in public relations before joining the Port Authority in 1937, and who had worked with Mortimer Edelstein in creating the distinctive 1940 annual report and in preparing his Cornell address on challenges and risk-taking at public authorities. The Board’s Vice Chairman, Howard Cullman, was enthusiastic about the Planning Program and the Sanders appointment, and most members of the Board favored going forward with Tobin’s recommendations.23 The Board Chairman, Frank Ferguson, felt differently. He had earlier criticized Tobin’s decision to appoint Edelstein as his top assistant, in terms that suggested he was motivated by ethnic prejudice. Now Ferguson vigorously opposed Sanders for the public relations post. The fact that she was Jewish seemed to be one reason for his animus; that she had personal ties to Howard Cullman, who loomed as a successor if Ferguson’s support weakened, may also have been a factor. Moreover, in view of his fiscal conservatism Ferguson could not easily endorse studies of projects (such as airports) that might run large deficits; nor could he feel enthusiastic about adding staff to carry out extensive surveys, in an era of reduced revenues and belt-tightening. Within a few weeks, reluctantly, Ferguson agreed to let the port studies proceed. However, he remained adamant on the public-relations appointment. In deference to his position as Chairman, the Board majority and Tobin held back.24 During the fall and winter of 1943–44, the division became sharper. Some commissioners supported Ferguson, out of respect for his long service with the Port Authority; having first been appointed in 1924, Ferguson was the senior commissioner in point of service, and he had been elected Chairman in 1934 and reelected annually to the top position every year since. Other commissioners, recalling that Ferguson had opposed Tobin’s appointment as executive director in 1942, viewed the chairman’s actions as an attempt to block Tobin from exerting leadership—and perhaps as tactical maneuvers which would lead him to resign. Ferguson also seemed motivated by a concern that an alliance to oust him from the chairmanship was in the making; he appeared to view Cullman as the leader of this group, with several of the New York commissioners and Tobin in the same camp.25 Tobin decided, for the present, to avoid a direct confrontation. It was clear, however, that his hopes for revitalizing the agency could not be re-

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alized unless the dominant sentiment on the Board was shifted from minimizing expenditures to a lively interest in finding new challenges for the Port agency. So Tobin set about to change their thinking. In his meetings with the commissioners and in his Weekly Reports, Tobin reminded them—perhaps “educated them” is the better phrase—as to the importance of thinking optimistically and aggressively about the future role of the Port and its Port Authority. Once the detailed planning studies were underway, he reported progress to the Board, week by week, again underscoring the range of projects the bi-state agency might undertake. And while the public relations job was left unfilled, Tobin and his aides made speeches and prepared press releases and articles which emphasized their broad regional concerns.26 The activities of Tobin and his staff, and the favorable press reports they generated, began to draw support away from Ferguson. Meanwhile, the Authority’s chairman set out to wound Tobin by attacking his long-time friend and top aide, Mortimer Edelstein. In the first weeks of 1944, Ferguson called Edelstein to his Jersey City bank office and accused him of having an affair with another Authority employee. Edelstein indignantly denied the accusation, but he soon concluded that he could not function effectively in the front office, in the face of the chairman’s hostility. Reluctantly, and despite his enjoyment in working with Tobin on the bond fight and now on plans to expand the agency’s scope, Edelstein decided to resign. By early spring he was gone.27 With Ferguson still blocking Marion Sanders, Tobin then advertised widely and interviewed a set of candidates from outside the agency. His first choice was Lee K. Jaffe, who had extensive experience in journalism and public relations. In April he sent her name forward, and most Board members were ready to approve the appointment. Again Ferguson objected, complaining openly that “she’s Howard Cullman’s cousin” (i.e., that she was Jewish). Now it was clear that the Chairman’s opposition was motivated by a streak of anti-Semitic prejudice, which Ferguson directed at Vice Chairman Cullman, at Sanders, and now at Jaffe. But the rest of the Board was reluctant to overrule their long-time leader. “There’s a problem in the Commission,” Tobin reported, in distress, to a close associate.28 Lee Jaffe’s friends in Washington were not willing to leave her fate to a weak-kneed Board. Informal contacts were made with Senator Robert Wagner (D-N.Y.), who reportedly called Authority commissioner Arthur Walsh. Both threatened to take the issue to the press. Ferguson relented partially, and in June Mrs. Jaffe was appointed Assistant Director. Within a few

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months, the stream of favorable stories that seemed to emanate from the Jaffe touch won him over, and in October she was named Director of Public Relations.29 As 1944 drew to a close, Ferguson had lost the support of most New York members of the Board, and his ability to retain the chairmanship depended on his allies among the six New Jersey commissioners—Frank Dorsey, John Borg, and Raymond Greer. Then Fortune and politics turned against Ferguson. In December Dorsey died; and by early January the other two New Jersey commissioners—Joseph Byrne and Arthur Walsh—had joined the New York members in supporting Cullman to replace Ferguson. But Ferguson could still block the appointment of a new chairman, as long as his faction held on to three of the six New Jersey seats. The vulnerable man was Borg, whose term had expired; and in January the blow fell, as Borg’s hopes for reappointment were dashed by Walter Edge, governor once again and now champion of a new state constitution, which Borg had opposed. It is likely that Edge was also intent on ending the conflict within the Board, which threatened to harm the effectiveness of an agency Edge had helped to create and of which he was proud.30 Early in February 1945, the commissioners reassembled, with Donald Lowe of Bergen County in place of John Borg, and Frank Abell as Dorsey’s successor. Abell and Lowe joined Byrne and Walsh in endorsing Howard Cullman as Chairman; Byrne, from Newark, was elected Vice Chairman. Both Cullman and Byrne were enthusiastic advocates of vigorous Port Authority efforts to reach out in new directions, and both were strong supporters of Austin Tobin. At last the Board was unified behind Tobin’s leadership and ready to support an aggressive Port Authority role in grappling with the region’s problems. It was a state of harmony that would last for more than two decades. Once he had lost in the February vote, Ferguson stopped attending Port Authority meetings, and in July 1945 he resigned from the Board and withdrew to the comfort of his Jersey City bank.31

Layers of Strategic Action It is true that people win politically because they have induced other people to join them in alliances and coalitions. But . . . typically they win [also] because they have set up the situation in such a way that other people will want to join

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them—or will feel forced by circumstances to join them. . . . [This is] structuring the world so you can win. —William H. Riker32

When the dust had settled in 1947 and the Port Authority had taken control of New York City’s air terminals and Newark’s airport and seaport, the Authority could argue—and did—that it had simply acted “in response to the City’s request” in studying and then proposing that it assume control of these major facilities. And when Herbert Kaufman prepared his extensive study of these events, “Gotham in the Air Age,” he pored through public documents and held interviews with top Authority officials and others, and he came away convinced that the initiatives leading to Port Authority operation lay elsewhere: “None of the evidence indicates that the officials of the agency contemplated or even considered upsetting the customary pattern of municipal airport development by moving directly into airport construction or operation..”33 What Kaufman had confronted, however, was not the reality of the Port Authority’s role but a carefully crafted strategy which helped to protect the Authority from the charge that it was an irresponsible “super-government,” reaching out octopus-like to grab control of important programs and squeeze the life from local government. Indeed, throughout the 1940s and the 1950s the Port Authority would only take formal action to study a problem and to propose that it take on new duties—in the fields of marine terminals and airports, bus and truck terminals, an occasional world trade center—if it first received a request from the mayors or governors or other responsible officials. The bi-state agency would then gather the best experts, study the request, and report the experts’ conclusions. Whether any action should be taken thereafter—requiring, for example, that the Port agency go forward with a project—would be the responsibility of the elected officials at the two state capitals. Behind these formal steps, however, lay a complex array of political calculations made in and around Tobin’s office, combined with extensive, often behind-the-scenes, negotiations. Central to these efforts were the “wait to be asked” criterion, together with three guidelines, which the Port Authority’s early history suggested were crucial to ensuring its continued political and economic vitality: 1. The need for new projects. In a friendly editorial in 1944, one local newspaper put the point in its most altruistic light, as the passion of an agency motivated by regional needs: “The port authority’s present prayer [is] ‘Please, God, give us some great new project which will keep us busy and popular,

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and useful.’ ”34 That passion did animate the staff; but another motivation also drove the search for new programs—the need to deflect political pressure to reduce bridge and tunnel tolls. The 50-cent charge per auto trip, established more than a decade earlier, had been under vigorous attack in New Jersey in recent years. With the likely expansion of postwar traffic, the Authority’s toll revenue would increase sharply, and pressure to reduce the existing toll level might become intolerable. However, if the agency gave in to that pressure, surplus funds required to reach out in new directions, and to maintain its independence, would be siphoned off; and the Port Authority might become simply a routine collector of tolls, a painter of bridges and tunnel roadways. Therefore it was important to develop a portfolio of useful projects, and to ensure that influential business and civic groups were ready and willing to press for action to carry out these plans. Then any campaign for toll reduction could be challenged, and perhaps defeated, because of the trade-offs involved: If the tolls were reduced, less money would be available to carry out programs which these civic interests thought were “urgently needed” to enhance the economic vitality of the region.35 2. A regional “balancing act”. The creation of the Port Authority in 1921 had been possible because business and political leaders had tentatively agreed to replace conflict with cooperation in seeking economic growth for the bi-state metropolis; but suspicion between the two states was not abolished by waving the Port Authority wand. Tobin and his associates realized that proposals to aid commercial vitality in New York must be balanced with projects to assist the cities of the Garden State, whose elected leaders would find a ready local audience if they denounced the agency for charging Newark and Hudson County citizens 50 cents a car to journey to Manhattan and points east.36 3. The “self-supporting” criterion. Under the “Edelstein principle,” a public authority should not be limited to projects which individually would pay their own way; a wider perspective, which weighed the importance of the project, and the agency’s ability to absorb any deficits from its more “profitable” programs, would be controlling.37 By 1945–46, a close look at political and economic realities convinced Tobin and his aides that they should retreat from Edelstein’s advanced position. They would still be in the “entrepreneurial business,” taking risks as they studied and embraced new projects: surely no one could be confident in 1944–45 and beyond that large bus terminals, union truck terminals, and airports would make money, even in the long run (and as it would turn out, some of them never would). But a rhetorical stance which

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favored taking on deficit projects “needed” by the region, to be underwritten by such money-makers as the Holland Tunnel, would provide no shield to protect the Port Authority from being forced to embrace pet projects of doubtful value all across the metropolis. The controlling hand would then shift to the bondholders, who might stop weak projects—and probably stronger but risky ones too—by threatening to sue. No responsible entrepreneur, in for the long pull at the Port agency, could look upon that unstable future with pleasure. Instead, the stated position of the Port Authority was that it would be willing to undertake construction projects, rehabilitation programs, and other activities in the field of transportation and terminals only if the new facilities could be expected, in the long run, to generate sufficient revenue to meet their total costs. Having no direct access to tax revenues—and very limited access to federal and state grants—the Authority’s leaders said they were unwilling to commit their funds and energies to any new project which seemed likely to become a permanent drain on the agency’s resources. This focus on self-support meant that the Port Authority would examine consumer demand for any project, other market factors, and construction methods and costs, with great care. Also, it would explore the possibility of federal aid or other outside funding which could reduce the financial burden to be met by revenues from the project itself.38 These guidelines, which were a complex mix of real constraints and public-relations stratagems, were ingrained in the thinking of all Authority staff members who had lived through the interstate conflicts of the 1930s and the Bush Terminal, Gerhardt, and Shamberg court battles. Now, in the postwar world, they would have to be applied in new terrain—where technological uncertainty was greater, and where a tradition of municipal control meant that initiatives by the Port agency would be more hazardous politically. Using the confidential 1943 report as a basic inventory of possible Port Authority targets, Tobin marshaled and deployed the agency’s resources for action. A flow of analytical studies, extensive negotiations, and public battles then followed, as the bi-state agency moved to construct two massive truck terminals and the world’s largest bus terminal; to lease and operate Newark’s marine terminal; to take control of New York City’s piers (an effort that was blocked by the city fathers); and to wrest the most glamorous transportation projects of the postwar era—the airports—from Newark’s political legions, from New York City’s elected officials, and from Robert Moses’ competing agency. In the remainder of this chapter we will focus on Tobin’s initiatives that involved the most complex strategies—those which brought the Newark and New York City airports, and Newark’s seaport, into the Port Authority’s

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lair. They nicely illustrate William Riker’s theme—structuring the world so you can win.

Airports and Marine Terminals: Strategies of Capture Although the Port Authority’s interest in constructing and operating airports and marine terminals had been set out in the confidential report prepared by Tobin and Hedden in June 1943, important questions remained to be answered: Could those facilities be made self-supporting? And if so, how could the cities of Newark and New York be persuaded to part with these sources of jobs and municipal pride? To answer these questions, the Port Authority carried out a threepronged strategy. First, Tobin and Hedden would need a careful economic analysis. Economist James Buckley was recruited along with a small staff to work with Hedden in analyzing the prospects for air traffic in the postwar years, together with the costs of developing major air terminals and the estimated income from airline leases, terminal shops, and other sources. By early 1945, it seemed clear to Hedden and Buckley that several large airports could be operated in the New York region on a break-even basis, assuming that initial development grants were provided by the federal government. The Port Authority followed the airport-aid legislation being considered in Congress in 1945 and testified in favor of such aid in March and June of that year. In addition, the Buckley team analyzed the prospects for ocean shipping and marine terminals in the postwar years and concluded that the Port Authority might operate one or more major seaport projects on a selfsupporting basis.39 The second element of Tobin’s strategy was to ensure that its studies and other activities—especially those concerned with improved air and marine terminals—were reported widely. As a result, his agency would be viewed as having expertise in air transport as well as maritime commerce, and it might then find it easier to take a leading role in shaping regional strategies in both fields. Here Tobin turned to the considerable skills of Lee K. Jaffe, his chief public-relations aide since the summer of 1944. When Tobin interviewed her in the spring of 1944, they “hit it off immediately.” Hired over Ferguson’s objections, she was soon included in policy meetings with Tobin, Hedden, Buckley, and Chief Engineer John Evans. Building on a decade of experience as a reporter and government press officer in Washington and New York, Jaffe established close working relationships with editorial writers and

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reporters on all the region’s daily newspapers, kept them constantly informed of new studies and human-interest stories in the Port Authority’s domain, and suggested ways of making a story newsworthy. And whenever a reporter or member of the editorial staff called with a question, she provided detailed information on issues and developments. “She was ingenious; she knew a good story and how to develop it,” recalled one of the region’s best veteran reporters. “And if you needed more [facts], she would get them and call you right back. . . . She was head and shoulders above anyone else in the publicrelations field.”40 The combination of new studies being conducted at the Port Authority with newspaper interest in “glamour issues” like air transport (and dull but economically vital ones like New York’s maritime commerce) provided a fertile field for Jaffe’s talents. Stories and editorials on the agency’s work on air and marine transport appeared with increasing frequency in late 1944 and 1945. This successful effort laid the groundwork for the wide press coverage and favorable editorial comments that soon would be needed, as the battle for control of the region’s airports was carried forward against vigorous criticism by the Port Authority’s opponents in 1946 and 1947.41 In addition to a careful economic analysis and a skilled public-relations program, the Port Authority strategy involved a crucial third element—developing close working relationships with experts who were engaged in related studies in the New York area. A natural candidate for cooperation was the Regional Plan Association, a civic organization with a regional perspective and a long tradition of collaboration with the Port Authority. In 1944–45, Hedden and his associates worked with the RPA and with the federal Department of Commerce to develop a plan for airports in the New York area. During the same years Buckley established close working relationships with staff members of the Civil Aeronautics Board and several of the major airlines, and these contacts helped the Authority in gaining CAB approval for additional airline routes for the New York region, and in obtaining information on the economic performance, past and prospective, of airline terminals.42

The Bartholomew Connection: Planners and Politics As the Port Authority’s leaders considered how the potential hostility of local leaders might be overcome—so they would ask the bi-state agency to take over their air and sea terminals—the most important connections were those with Harland Bartholomew & Associates, a national group of planners called

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in by the City of Newark in 1943. Bartholomew and his aides were the most significant because of the quality and influence of their analysis, and because their team was the first to recommend that the Port Authority be asked to take over and operate the region’s air and sea terminals. The steps through which this recommendation was developed deserve more detailed attention—because of its intrinsic importance to our story, and because that evolution illustrates some of the strategies available to the public entrepreneur, when the political ground is complex and potentially treacherous. In the fall of 1943, Newark’s Central Planning Board engaged Bartholomew to carry out a thorough survey of the city’s planning and development problems. He was no stranger; a planner and planning director in Newark in 1912–1919, Bartholomew then went to St. Louis, where he established his own firm. By 1943 he was one of the nation’s premier urban planners, working on studies across the country, but he readily threw his energies into the problems of his old city. That fall he met with members of the Newark Planning Board and worked out arrangements for an extensive study; and during the next four years the firm completed more than a dozen surveys covering Newark’s major physical development and fiscal needs.43 One of the Planning Board’s members was Joseph M. Byrne, Jr., who served also as an elected member of the city’s governing body, the City Commission. Byrne’s specific responsibilities included oversight of the city-owned piers and its airports. Fortuitously, he was also a Commissioner of the Port Authority and an active member of the Tobin-Cullman faction which favored expanding the Authority’s responsibilities. In November 1943, Byrne brought Tobin and Hedden together with Bartholomew and members of the Newark planning board, and they discussed areas of cooperation between the Port Authority’s planning staff and the Newark study group. By early 1944, two of Bartholomew’s associates, Harry Alexander and William Anderson, were living in Newark and devoting full time to analyzing population trends, housing conditions, and other facets of the city. When information on traffic potential and development costs for maritime and air transport in the region was needed, they found the Port Authority’s staff ready to help and its files a valuable resource.44 Newark’s seaport had been opened in 1917; its airport began operation in 1928. Neither had been a sparkling success in economic terms, and the harbor area was badly run down. Because of the city’s other needs, it seemed doubtful that Newark could allocate the large sums needed to modernize and expand the sea and air terminals so that they might, in time, become selfsupporting. Moreover, the planners found, there were “hundreds of patron-

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age jobs” at the two facilities; and some employees listed on the port rolls “had never even seen the port.” Efficient operation and energetic management seemed very unlikely if the facilities continued as regular departments of city government. Visiting Newark in the summer of 1944, Bartholomew thought about possible sources of revenue to rehabilitate the seaport. “It was a very dreary prospect,” he later recalled, but he wondered if the Port Authority “might have an interest.” He called Tobin. “I got to see him right away,” he later recalled. Bartholomew inquired whether the Port Authority would consider taking over Port Newark, and they talked about that; Tobin asked some questions about the airport too. Tobin said he would talk with the Board and asked, ‘Could you come back in two weeks?’ And I said, ‘Yes, I could.’ “It was a terrific proposal that he gave me right away in the second interview. . . . He outlined the whole thing. . . . He was more interested in the Newark airport than he was in the seaport. That took me by surprise. I remember he was very specific that they would be willing to take over the port and the airport and make an agreement for a 40-year lease. . . . They would enlarge the airport. He then was talking about what they would do at the airport. The thing was so comprehensive—his proposal—that I remember going back to Newark on the train, I was just on cloud nine; the idea of a proposal like this was fabulous, fabulous.”45 Bartholomew understood that Tobin’s strong interest in the two Newark projects would have to be treated as confidential for the present, and the formal initiative would remain with the city’s planners. If Bartholomew and his colleagues analyzed the situation and concluded that operation by the Port Authority would be the best solution for Newark, they would recommend to the planning board that the Authority be asked to submit a detailed proposal. One of his staff members, William Anderson, then looked more closely into the costs of rehabilitation and development and into the ability of the Port Authority to undertake the large expenses that seemed necessary. In addition, in consultation with the Port Authority staff and the Regional Plan Association, they considered the advantages of regional coordination in developing marine and airport facilities, compared with the tradition of competitive conflict that had shaped relationships between Newark and New York City.46 On October 8, 1945, Bartholomew sent to his colleagues a draft set of conclusions, and within a few weeks, the firm’s entire 106-page report was circulated privately to the Central Planning Board. Copies were also sent to the Port Authority’s staff.

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The Bartholomew report was crucial in framing the public debate on what role the Port Authority should have in the development of the region’s air and marine terminals. The report described the investments needed to rehabilitate Newark’s facilities; it set forth the financial results of past decades, which had cumulatively cost local taxpayers $9.6 million for Port Newark and $7 million at the Airport; and it noted that the city faced heavy demands in the postwar years to rehabilitate its schools, hospitals, and other facilities. Moreover, the report pointed out, other regions had moved away from municipal operation of seaports and air terminals, turning instead to specialized public authorities for marine terminals, and to regional agencies for airports. After examining the alternatives, which included continued city operation, private operation, or creation of a new public agency, Bartholomew was emphatic in his conclusions: The Port of New York Authority . . . is peculiarly well constituted to handle facilities of this type and has a large staff with long experience in all forms of transportation. . . . [It] is in a position to finance further construction. . . . Continuity of policy and other good business practices would be applied as they have been with other Port Authority enterprises.

His report also reached beyond Newark to frame the issue in a perspective consistent with the Port Authority’s own views and long-range hopes: Since the location and the traffic of both the seaport and the airport are so completely integrated with the remainder of the New York metropolitan area, it is unwise for Newark to attempt to further develop these facilities by itself. Their greatest usefulness and the maximum volume of traffic to be expected will be attained only through their coordination with other facilities in the New York metropolitan area.47

By early December 1945, the Newark Central Planning Board had reviewed the Bartholomew report, and on the 14th the Board endorsed the report and released it to the public. The planning body, whose leaders included prominent business and civic officials in the city, urged the Port Authority to take the initiative in exploring with Newark’s elected officials the possible takeover of the airport and seaport. Tobin and his allies had taken a major step in “structuring the world” so they could win.48 But this was only the first step, and nearly two more years would be required for the Port agency to emerge with victories on both sides of the Hudson.

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“Our Statutory Duty”: The Reluctant Dragon Stretches Her Wings The marine and air terminals and the revenues therefrom to be the property of the Port Authority . . . and the Port Authority’s decisions to be controlling as to all matters. —Port of New York Authority, Development of Newark Airport and Seaport: a proposal to the City of Newark, July 1946

Tobin and his colleagues were not inclined to rush forward in response to the planners’ invitation. Eight months earlier, Vice Chairman Joseph Byrne had publicly stated his personal view—that Newark ought to place its airport and seaport under Port Authority control. City commissioner John A. Brady had reacted to this trial balloon with a vigorous attack, calling it “municipal suicide.” Such a move would cause Newark’s destiny as a great seaport and aviation center to “vanish into the stratosphere,” he argued. Brady criticized the Authority for “its notorious leanings toward New York, as against Newark and New Jersey,” and for its “powerful, arrogant administrative staff which has always treated Newark as a service station for Manhattan.” Most of Newark’s other elected officials were known to share Brady’s aversion to losing the terminals.49 Therefore Tobin moved cautiously. Before the Port Authority could propose taking responsibility for the airport and seaport, “a thorough study” would be needed, Tobin said, requiring “the expenditure of substantial public funds.” Such an effort should be taken only if the city really wanted it done; if an “official request” from the entire City Commission were made, the Port Authority would be “willing to undertake such a study.”50 This placed Newark’s elected officials in a position that ill suited their preferences. Several of them were vigorously opposed to ceding Port Newark and the airport to any outside agency; such a step would be a blow to the city’s pride, and it would also undermine their own influence in awarding contracts and finding jobs for loyal friends and party workers. However, with the city’s business leaders on the Planning Board urging that the Bartholomew proposal be explored actively, the commissioners could hardly boot this unwelcome guest out the door. On December 27, 1945, they voted to ask the Port Authority to study the possible takeover; and the Authority responded at once that it would be glad to do so. Within a few weeks, Tobin had hired additional staff members and consultants, and a detailed survey of Newark’s airport and marine facilities was

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underway, with Walter Hedden in charge. Now the Port Authority could turn to larger game: New York City’s two airports and those who guarded their gates, the city’s mayor and its longtime chancellor, Robert Moses. Mayor LaGuardia had spent much of 1945, his final year in office, trying to advance his own plans—to improve LaGuardia Airport and complete a vast new airfield at Idlewild. His aides had negotiated long-term leases with the major American airlines that would, the mayor hoped, lead them to view New York— rather than Newark—as their main base of operations in the region. And the outgoing mayor urged the City Council to appropriate $45 million for expanded construction at Idlewild.51 However, other local officials did not share LaGuardia’s commitment to developing the airports with local tax moneys. The City Council deleted the $45 million appropriation in late December, and in January 1946 the new mayor, William O’Dwyer, endorsed an alternative suggested by Robert Moses—turning the airports over to an independent New York City Airport Authority, so that the city’s own capital funds could be used for schools, streets, and other urgent needs. Legislation to create an Airport Authority was prepared with Moses’ guidance and introduced in Albany in early January.52 In order to block the Moses-O’Dwyer plan, the issue would have to be redefined for the region’s business and political leaders, and for the general public. This would require close contact with journalists and editorial writers, and discussions with citizens groups and other opinion leaders, so the issue of airport development (and, if possible, marine development too) could be understood in its “proper light”: as a long-term development and investment program, requiring large amounts of funding over a period of years before the terminals could be self-supporting; as an immensely complex package of engineering and administrative issues, which should be undertaken by an organization with a high-quality staff and a proven track record; and, in particular, as a regional problem, best resolved through coordinated planning and action, not through narrow competitive actions of individual cities. The central challenge, then, was to bring these perspectives, and the facts that underlay them, to the attention of the media and the public. The opening salvos in the campaign for “regionalization” of the airport issue were launched by the press, with assistance from the Port Authority, soon after Newark’s city officials asked the Authority to carry out a study. On December 30, the Herald Tribune published a long essay which concluded that the Newark survey suggested to “aviation experts” that the region’s entire airport system “might be best coordinated and operated by the Port Authority.” An article on Newark’s airport in the Christian Science Monitor on Janu-

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ary 3, 1946 referred to “many experts” who “feel the time is coming soon . . . when air facilities must be planned regionally.” The same theme was echoed in the Newark News and the Star-Ledger during the following week.53 Discussions with staff members at the Port Authority, the Regional Plan Association, and the airlines helped to shape these stories and those that appeared in the next several months. The tracks of Tobin, Jaffe, and their aides could be seen clearly, for example, in reporter Cecile Hamilton’s feature article in the Herald Tribune, which suggested that the best answer might be to place airports in the hands of an region-wide authority which would finance its activities on a “self-supporting . . . and revenue-producing basis.” Only the Port Authority staff advocated the self-supporting concept for airport development.54 The advantages of placing all of the region’s airports in the hands of this particular authority might be demonstrated, Tobin and his aides thought, by evidence of their striking visions for the Newark airfield. In mid-March, they provided reporters with a detailed briefing on their Newark plans, and a few days later the agency released a “progress report” which indicated that it would be recommending vast improvements in marine cargo sheds, airline hangar space, and runways. Early in April, Lee Jaffe arranged a meeting which brought together Tobin, Hedden, and Vice Chairman Byrne with the editors of the Newark News and the Star-Ledger to discuss the Port Authority’s plans for the airport and seaport. Soon thereafter, in an editorial praising the Port Authority on its 25th anniversary, the Star-Ledger referred to the studies in Newark and argued that the “best interests of the metropolitan area call for an integration of all airports in the area into a single system.”55 By early May, Tobin and Jaffe decided the Port Authority could send its own Commissioners forth to preach the gospel. Asked by the Herald Tribune’s editors to comment on the airport problem, Chairman Howard Cullman urged that the “barriers of provincialism” be cast down and that airport development go forward on a regional basis. Addressing his fellow New Jersey citizens, Vice Chairman Joseph Byrne pointed to the advantages which the Port Authority would bring—in financial resources and staff expertise— if it were given responsibility for airports throughout the New York area.56 It was one thing to advocate regional coordination in airport development and to generate media applause for the Port Authority as the way to achieve such coordination. It was quite another, requiring a more variegated strategy, to meet the challenge posed by Robert Moses’ City Airport Authority. Taking office in January 1946, Mayor O’Dwyer endorsed the Airport Authority as the best way to develop LaGuardia and Idlewild, and he sent legislation to Al-

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bany for state approval. O’Dwyer and Moses won an early endorsement from the New York Times, which thought “a new Authority charged solely with building and managing” the city’s airports “to be a wise delegation of responsibility.” And when a citizens group proposed Port Authority operation as a better solution, O’Dwyer attacked that view. The mayor said he was “astonished” by the proposal, for it would involve “an abject surrender of the city’s planning powers” to an agency subject to control only by the two governors, thus giving New Jersey’s governor the ability to “determine whether Newark instead of Idlewild” would be the region’s international air center. The fine hand of adviser Moses could be seen in the phrasing of O’Dwyer’s rejection and in his sharp attack on the Port Authority, which he said should use its financial strength to reduce its “exorbitant” bridge and tunnel tolls, rather than reaching out for the city’s airfields.57 By early April, Moses had guided the bill through both houses of the state legislature and Governor Dewey had signed it; and on April 6, three commissioners selected by O’Dwyer and Moses were installed. The Airport Authority now stood poised to take responsibility for the New York fields and for guiding their development.58 To reverse the “go it alone” New York policy advocated by Moses and O’Dwyer, the Port Authority would need to find allies beyond the editorial writers and newspaper reporters. Three groups were potentially of great importance: the airlines (would they view the City Airport Authority as a satisfactory way to meet their airport needs, or oppose it and favor the Port Authority?); the investment banks (would they accept airport-development bonds issued by the new Authority?); and New Jersey business and political leaders (if they endorsed the Port Authority’s Newark plans, the threat that Newark Airport might modernize and drain traffic away from the New York airfields would be far more salient). During the spring and summer of 1946, Tobin and his aides began to knit together a coalition that included all of these potential allies. It was not difficult to persuade the airlines to cast doubt on Robert Moses’ new creation. Even before the Airport Authority legislation was signed, Moses had announced that the agency would tear up the LaGuardia leases with the airlines, and that far steeper lease rates would be put into effect in order to finance the development of Idlewild and LaGuardia airports. The airlines opposed any changes in the favorable terms they had received from LaGuardia’s negotiators and they stood ready to defend the leases in a court suit; at the same time, they recognized that without massive contributions from the city treasury or some other source, the Airport Authority would be unable to de-

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velop the facilities desperately needed to accommodate rapidly expanding air traffic in the region. In February, the airlines expressed “considerable anxiety” as to whether the Airport Authority was a viable strategy. The Port Authority then invited the airline executives to view the agency’s evolving plans for Newark Airport, and they expressed “great surprise and gratification” at the improvements planned by the bi-state agency.59 As their report moved toward completion, Tobin and Hedden held informal meetings with business leaders in Newark, and articles appeared in the local press suggesting that the city could expect thousands of additional jobs at the airport and seaport. Joined by Vice Chairman Byrne, Tobin then spent an hour with Governor Edge and emerged with his public support.60 Meanwhile, the New York City Airport Authority had run into trouble. Soon after the Authority’s three commissioners had been appointed, the Mayor’s airport adviser, Robert Moses, began to intervene in their affairs. At his behest, city appropriations to be used by the Authority in developing Idlewild were reduced by $15 million, and O’Dwyer rejected an Authority request that LaGuardia Airport be turned over to that agency. Then Moses urged the Airport Authority to issue $60 million in bonds to finance work at Idlewild, and to join him in denouncing the existing airline leases. But financial experts friendly both to the Port Authority and to city officials told O’Dwyer that any bonds issued by the Airport Authority probably could not be sold because of the uncertain revenue picture. Moreover, the Authority chairman, Harry F. Guggenheim, objected to Moses’ tactics, and on July 18 he resigned, advising Mayor O’Dwyer to “get the airports out of politics” and turn them over to the Port Authority.61 Now Tobin stepped across the Hudson, and in late July he convened a public meeting with Newark’s mayor and commissioners. The bi-state agency was ready, he announced, to take responsibility for modernizing and operating both the air and sea terminals. It would invest $11 million in Port Newark, and an additional $55 million in Newark Airport, in order to create “one of the greatest airports in the world.” The Port Authority would also pay $1 million annually to Newark for five years and $100,000 a year thereafter in lieu of taxes, and develop revenue sources that would ultimately make the airport and seaport self-supporting.62 With the New York City Airport Authority floundering, with pressures mounting to spend his city’s construction funds for other purposes than air terminals, and with the threat of a revitalized Newark Airport now emerging clearly, it seemed almost inevitable that O’Dwyer would ask the Port Authority to make an offer for the New York City airfields. But Moses was still

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a major influence at City Hall, and Moses was vehemently opposed to letting the bi-state agency expand its domain.63 An additional nudge seemed desirable, in order to ensure that O’Dwyer knew that the Port Authority stood ready to extend a “helping hand” to New York City as it had to Newark—if O’Dwyer would only ask. That nudge was provided by Eugene Black, a Vice President of Chase Manhattan Bank, who had worked closely with Tobin in the late 1930s on the battle to preserve tax-exempt bonds. Black telephoned O’Dwyer, whom he also knew, and after a series of calls involving Tobin, Cullman, O’Dwyer, and Black, the mayor agreed on August 2 to send a formal request to the Port Authority, asking that it “immediately” undertake studies to determine whether the Authority might be able to take responsibility for New York’s airports, and thereby “relieve the city of a tremendous burden of future airport financing.” The first step toward “abject surrender,” as the mayor had called it six months before, had been taken.64

The Port Authority Afloat and Aloft The fourteen months between O’Dwyer’s announcement on August 2, 1946 and the final steps in the regional airport negotiations were filled with announcements and denouncements, backing and filling by New York’s mayor, attacks by the Port Authority’s opponents in Newark’s City Hall, and resistance by Tobin and his colleagues, followed by compromise. At the end, the Port Authority and its expansion-minded executive director had won. In April 1947, the City of New York agreed to lease LaGuardia and Idlewild to the Authority; and in October, Newark and the bi-state agency reached agreement, with the Authority assuming control of the city’s airport and seaport several months later. The complex interplay of public rhetoric and less visible negotiations during this period illustrates the divergent perceptions and interests which make regional cooperation so difficult; and the Port Authority’s adroit maneuvers, described below, provide further illustrations of Riker’s thesis and suggest an array of strategies that can be used by agencies and leaders who aspire to be entrepreneurial. The Port Authority’s announcement in late July, setting forth the conditions under which it could assume control of Newark’s airport and seaport, was met with enthusiastic support by the region’s newspapers and Newark’s business leaders. However, the agency and its plans were the target of vigorous attack by Newark’s elected officials, and by September all four City Commissioners stood opposed to the Authority’s offer. Only the mayor, Vincent J. Murphy, ap-

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peared open-minded. He held meetings with Walter Hedden and with city business executives, and he carefully examined the severe fiscal demands facing the city.65 The editorial writers then attacked the city’s elected leaders, adopting a position that underscored the advantage of Tobin’s strategy of caution. Noting that Commissioner John A. Brady had criticized the Port Authority for proposing to take over the city’s terminals, the Newark News commented: “For Mr. Brady’s information, [the] Port Authority didn’t just barge in. It came in at the specific invitation . . . of the City Commission.” The Port Authority’s offer, observed the Star-Ledger, was now being treated “as though it were an unwarranted and impudent intrusion upon the city’s sovereignty,” although it “grew out of the initiative of the Newark City Commission.”66 However, the majority of the Newark Commissioners held their ground, and by October, Tobin was pessimistic as to the possibility of prompt action. “It would appear that some time must elapse,” he wrote to his own Board, “before the Newark proposal arises again for further consideration; time in which [the city] must face the expenditure of millions for the repair of the Newark Airport and Seaport and in which the services and revenues of the present obsolescent facilities will steadily decline; time in which the City Commissioners of Newark will be forced to public defense of the consequences to the City of their rejection of the Port Authority’s proposal.” By now, none of his commissioners, except for Chairman Cullman, had served as long as Tobin, and few had served even half as long. This seemed an appropriate opportunity to remind them that perseverance, not quick victory, was the hallmark of Port Authority tradition: “The history of every Port Authority project,” Tobin wrote, “is one of protracted effort, of temporary setbacks, of opposition that at the time seemed immovable. Years elapsed . . . between the preparation of the first reports . . . and the actual construction of the various bridges and tunnels.” The proposed takeover of Newark Airport and Seaport had been initiated less than a year ago, he concluded; “we have finished the first chapter but we have not closed the book.”67 But there were two strings to the Port Authority’s airport bow, and while Newark’s commissioners fumed, Tobin and his aides turned their attention to New York City and completed the proposal Mayor O’Dwyer had requested. By the middle of December 1946, a draft had been finished and reviewed with the Mayor, and on December 18 the Port Authority announced a $191 million proposal for rehabilitation and development of New York’s airports. A few days later, the city’s own Department of Marine and Aviation submitted a competing plan, under which it would develop Idlewild, using

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city funds; the program would cost but $70 million. And on January 13, 1947, the City’s Airport Authority—still alive though headless—threw its proposal into the ring: it would develop and operate the New York airfields for only $80 million.68 The editorial writers and financial analysts had no difficulty in choosing among the three plans. The Port Authority had outlined a far more ambitious program, which seemed more likely to meet the needs, or at least the hopes, of the business community and the city; moreover, the Authority had far greater financial resources and staff expertise, and a stronger general reputation, than the patronage-riddled city agency or the new Airport Authority. For those who thought in broader terms, the Port Authority also had the advantage of its bi-state range; airports, as these commentators concluded, are “a regional business.”69 To O’Dwyer and his fellow city officials, the advantages of ceding control over a major source of jobs, contracts, and municipal prestige were less clear. Moreover, some of the specific provisions in the Port Authority proposal— which included a profit-sharing scheme and a long lease period (99 years)— seemed unduly tilted toward the agency’s interests.70 During January and February, O’Dwyer appointed committees to consider the alternatives, public hearings were held, and those favoring various possible solutions marshaled what evidence and political support they could find. In these weeks, the Port Authority put its intellectual and strategic strengths to good use. Allies in the investment community and among Manhattan’s civic associations were called upon for support, and an important alliance with the nation’s major airlines was formed—and paid for in coin that would, less than a year later, leave a bitter taste. For American Airlines, United, and the other large U.S. carriers, two goals were paramount. First, they wanted rapid development of LaGuardia, Idlewild, and Newark airports—preferably on a coordinated basis. Second, they wanted access to these airports at the lowest possible rates—ideally, at the very favorable lease rates agreed to in 1945 by Mayor LaGuardia. With its ambitious development plans, its region-wide scope, and its expanding bridge-and-tunnel toll receipts to finance these plans, the Port Authority was in the best position to meet the airlines’ first goal. As early as August 1946, Eddie Rickenbacker and other airline executives had personally expressed to Tobin their enthusiastic support for the agency’s plans at all three airfields.71 However, the lease rates were a matter of real concern to the airline executives. Moses had denounced the LaGuardia-McGoldrick 1945 leases as too favorable to the airlines, and in view of his influence in the O’Dwyer

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11-2. As air traffic expanded in 1946–47 and the debate over how to complete Idlewild continued, a New York Post cartoonist suggested this interim solution.

Administration, it seemed possible that a city department and the Airport Authority would refuse to honor the 1945 agreements as applicable to the large new airport at Idlewild. Could the Port Authority assure the airline officials that it would abide by those rates? The airlines sought Tobin’s views, and during the fall of 1946 Tobin commissioned studies by outside experts to double-check the revenue and cost

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analyses which were being carried out by his own staff. Specifically, Tobin asked whether, under the proposed development plans, existing lease rates and other revenue sources would permit the New York City airports to be selfsupporting. Expert opinion inside and outside agreed: based on the “LaGuardia leases” and with added revenues from concessions and other sources, the Port Authority “would be able to place the airports on a self-sustaining basis within a very short period after the completion of construction.” Tobin then wrote to the airline executives in January 1947, setting forth his conclusions regarding the leases “covering activity fees and space” at Idlewild: The Port Authority is definitely of the opinion that these leases are valid. We have premised our revenue estimates on the rates set forth in those leases. Only details would require renegotiation, and these would not involve any increase in rates to the airlines for services or space at the airport.72

Spurred by Tobin’s assurance, and by their general preference for the Port Authority as airfield operator, the airlines threw their energies into the fray with enthusiasm, attacking the City Airport Authority and endorsing the Port Authority proposal in public letters and public hearings. They also “threatened to locate their maintenance bases elsewhere,” thus depriving New York of thousands of jobs, if the city government did not act quickly to ensure adequate development of New York’s airports.73 Tobin also called upon his associates in the investment banking community, who publicly stated that they would accept Port Authority bonds for airport development but that City Airport Authority bonds would never find a buyer. Spokesmen for the Regional Plan Association, the Citizens Union, and city business leaders endorsed the Port Authority as the best agency. And the Port Authority itself attacked the Airport Authority’s $80 million plan as inadequate, criticizing the idea that “Airport Authority bonds, backed by nothing more than the promise of revenues from a still uncompleted airport, would sell at a reasonable rate.”74 Moses’ Airport Authority was now dead, but Moses was not. Abandoning his stillborn offspring, Robert the Nimble met with O’Dwyer and urged him to keep the airports out of the hands of the Port Authority. The city could operate the airfields itself, he argued, using a “bare-bones” investment strategy at Idlewild. In late February O’Dwyer had expressed his personal preference—to newspaper editors, and to Tobin—for Port Authority operation. Two weeks later, an exasperated Tobin wrote to his Board that Moses “has swung Mayor O’Dwyer around again, full circle” to the posi-

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tion that the city could hold on to the airports, invest practically nothing, and “simply tell the airlines to use the facilities already installed and make the best of it.”75 Three sharp blows broke the back of the Moses stratagem. First, Tobin and Jaffe took their concerns to the press, which then attacked the MosesO’Dwyer position and endorsed the Port Authority proposal. “New York City is fumbling the ball of world airport leadership,” wrote Allan Keller in a twopart feature in the World-Telegram, by trying to use a “makeshift, patch-andragtag program.” Keller and his fellow journalists urged that New York’s airports be built instead “on a stable, long-term basis by the Port Authority.”76 Second, a close friend of Tobin’s in the investment community met with O’Dwyer and emphasized the financial difficulties the city would face if it continued to carry the burden of developing its airfields. The meeting apparently shook O’Dwyer’s confidence in the Moses plan.77 And third, Tobin agreed, albeit reluctantly, to modify the Port Authority’s December proposal. Initially, when city spokesmen had asked whether the agency could improve its offer, Tobin had resisted. The Authority had submitted the best offer it could make in view of its own financial constraints, Tobin felt; indeed, his general approach was to begin with a solid offer and oppose changes. By March, his colleagues at the Port Authority had convinced him that he would have to compromise if the deadlock was to be broken and the Moses strategy scuttled. In mid-March, Tobin and several of his aides met with O’Dwyer’s representatives; concessions were made by both sides, but “only after bitter argument, each party giving ground by inches.” Negotiations often threatened to break down, and here Juan Trippe, president of Pan American, took a crucial role. Trippe had acted as spokesman for the major airlines in their discussions with the Port Authority in 1946; he had developed respect and fondness for Tobin, and the feeling was mutual. Now, sitting in on the March negotiating sessions for the airlines, Trippe served as an informal mediator, softening Tobin’s stubbornness and the intransigence and suspicion that developed on both sides.78 As a result of these discussions, the Port Authority submitted a revised offer on March 26, 1947, and the mayor and Board of Estimate at once accepted it. The lease would run only 50 years instead of 99 years; the city’s share of any net profits at the airports was increased from 50 to 75 percent; and the Port Authority would provide its own police and fire protection, instead of relying on the city. So the revised lease, which was formally signed on April 17, gave more to the city than the December proposal. And in return, Tobin and his colleagues had taken a major step toward expanding the

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responsibilities of their bi-state agency—and a major step toward fulfilling the goals set forth in the Tobin-Hedden report of June 1943. But it was only half a step, at best, in terms of the 1943 plan and the evolving views of Tobin and his aides. A regional airport system had to include Newark’s major terminal; and a vigorous transportation system for the New York region required modernizing marine terminals as well as airports. Even before the New York agreement was signed, Tobin and Jaffe turned their attention again to Newark, where the near-rapprochement with O’Dwyer might help extract Newark’s airport, and its seaport as well, from the unhappy City Commissioners.

Closing the Noose at Newark Newark’s commissioners had opposed the Port Authority proposal in the fall of 1946, although it appeared unlikely that the city could finance development of Port Newark and the airport with its own funds. In the long run, Tobin felt certain, the city would have to turn to the Authority; but there were some steps that might be taken to increase the pressure produced by the Authority’s offer, and thus speed Newark toward the inevitable. The Planning Board’s chief consultant, Harland Bartholomew, returned to the city to urge that the air and marine terminals be transferred to the Authority in order to save Newark’s taxpayers from having to spend $47 million in needed capital improvements at the two facilities. “That money could be used to better advantage,” he argued, for streets, schools and other urgent needs. Meanwhile, Tobin and his New Jersey Board members journeyed to Trenton to confer with Republican Alfred E. Driscoll, who had been elected governor in November 1946. By January, they had his support, and in his first message to the legislature, Driscoll urged favorable action on the Authority’s proposal to take over the two Newark terminals. “The time has come,” the governor declared, “when the people of that city can no longer be expected to underwrite huge capital investment outlays of this kind.”79 The Newark News, a vigorous supporter of Port Authority operation, immediately pointed to one implication of the governor’s comments, warning Newark’s elected officials that they could hardly expect Driscoll to respond sympathetically to their pleas for greater state financial aid, if they continued to reject the Port Authority’s offer to remove the seaport/airport albatross from their necks.80 Still the Newark commissioners resisted, but the noose was tightened further when negotiations with New York’s mayor moved toward success in

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March. It was now time, the Newark News argued, for the city fathers to approach the Authority offer “in a reasonable spirit of compromise,” as O’Dwyer had done. Otherwise, Newark Airport would face far worse competition than it had in the 1930s, for it would now confront not the uncertain investments and managerial quality of New York City’s government, but instead “a rich, interstate agency” operating two “enlarged and improved” airfields. Speaking a few weeks later, Howard Cullman outlined the Port Authority’s $190 million plans for the New York airports and stressed the same point. When the Authority’s plans are completed, he declared, Idlewild and LaGuardia would far outstrip other air terminals in the nation, which would then be little more than “whistle stops on a suburban line.”81 By May, under pressure from Newark’s business leaders, local newspapers, and the governor, the city commissioners resumed negotiations with Tobin and his aides. The Authority improved its original offer to make it comparable to the terms of the April agreement with New York City. The new offer guaranteed a minimum of $6 million in rental payments during the 50-year lease; and if the Authority were able to operate the seaport and airport at a profit, as anticipated, rental payments to the City of Newark might total as much as $38 million during the 50-year period. In the hothouse of New Jersey municipal politics, “negotiations” has a different flavor than it does in the canyons and boardrooms of Manhattan; political rhetoric is somewhat less graceful, but it may stir the blood of a suspicious citizenry far more. Commissioner Brady reviewed the Port Authority’s revised offer and led the attack. The Authority’s rental figures, he exclaimed, “are the most distorted figures I’ve seen since my childhood;” the estimates were “a deliberate attempt to befuddle the people.” His colleague, Meyer Ellenstein, noted that no airport in the country had yet been able to operate at a profit; so, he concluded, Newark could expect no more than the $6 million minimum from the Port Authority. A former amateur boxer, Ellenstein continued to punch away at the bi-state agency, urging his fellow Commissioners not to be “hoodwinked” by the Authority’s numbers.82 As the Star-Ledger commented editorially, Brady and Ellenstein seemed to approach these negotiations more as a matter of generating headlines than engaging in serious bargaining. They appeared to consider it “good politics” to profess that the Port Authority is a “monster seeking to devour the city and its people.”83 However, the reality of Newark’s fiscal needs, combined with the business and editorial interests arrayed in favor of the Authority proposal, isolated Brady and Ellenstein. During the summer of 1947, the other two city

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commissioners joined the mayor in an effort to reach an accommodation with the Port Authority, and negotiations on an acceptable lease went forward. Ellenstein, Brady, and their allies then mounted a last-ditch effort, gathering signatures on a petition which would demand a referendum on the lease agreement. The Port Authority and its friends fought back. Having taken over LaGuardia Airport in July, the bi-state agency announced that in its first three months of operation, airport revenues had increased sharply. These conclusions were promptly conveyed to the Newark News editors, who summarized the Authority’s interim report and concluded that “while Newark Airport continues to be a drain on the taxpayers,” creative management strategies introduced by the Authority had made a striking difference at the New York field and showed what the agency could do once it had rehabilitated Newark’s air terminal.84 Meanwhile, after consulting with Tobin and his aides, Newark’s business leaders issued a detailed report countering the Ellenstein faction, and endorsing the Port Authority’s program. The Authority would approach the airport problem “from a regional rather than a narrow local viewpoint,” these business allies argued, thus eliminating the “competitive squabbling” which had shaped airport development in the past.85 And the airlines once again weighed in on the Port Authority’s side. In a meeting sponsored by the Regional Plan Association in early October, American Airlines president Ralph Damon congratulated New York City for its “wisdom in assigning control of its airports to the Port Authority,” an agency with the “financial strength and business acumen” required to develop needed airport facilities with “speed and dispatch.” Damon urged Newark to turn its airport over to the Authority, which would receive “complete cooperation” from the airlines in going forward in the new air age. In praise of the Authority’s potential, Damon concluded that “no other cities in the United States are so fortunate in having such an agency capable and prepared to provide . . . their immediate and long range airport requirements.” A few days later, Eddie Rickenbacker of Eastern Airlines spoke before the Newark City Commission and expressed the same position.86 Editorial acclaim for the Port Authority’s position on air and marine terminals was widespread; reinforced by favorable attitudes toward the Authority’s other activities, newspaper support for the agency’s general contribution to the region was extensive. In early October, Lee Jaffe counted up the editorials since her arrival in 1944, and Tobin reported to the Board that there had been much improvement since the mixed editorial reviews of 1942–43. The tallies were summarized for the Commissioners: In 1945 there were 29

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favorable editorials, in 1946, there were 280, and in 1947 there had been 317 to date. “The only unfavorable editorials” in the past two years, Tobin reported, “appeared in one newspaper, the Bayonne Times.”87 Still, the Newark Commission minority pressed forward with its anti-Port Authority rhetoric and gathered 20,000 signatures on a petition urging a citywide referendum on the plan. Reviving an ancient antagonism, the railroads joined the battle, arguing that Newark ought not permit the Port Authority to expand its “tax-exempt operations.” Then Cullman hinted that the Port Authority might establish a major airport elsewhere in New Jersey if Newark barred the door. And, working in consultation with Tobin and the New Jersey members of the Authority Board, Governor Driscoll stepped forcefully into the situation. Driscoll reminded the Newark commissioners that he had been supporting programs which would provide more state aid to Newark and other older cities, and that city officials must now “help themselves” by eliminate deficit-generating activities. In four days of intensive discussions with the Newark officials, Driscoll pressed them to accept the Port Authority offer without further delay.88 Finally the combined forces of local, regional and state pressures overcame the attractions of municipal independence and patronage. On October 22, 1947, Newark and the bi-state agency signed an agreement leasing the city’s airport and marine facilities to the Port Authority for 50 years. Air transport services would now be planned and developed on a “truly regional basis,” Tobin reported to his board; and in adding Port Newark, the Port agency had taken a substantial step toward “unification of pier and waterfront activities.”89

Wider Dreams and the Creation of a Dedicated Staff In the summer of 1943, Tobin and Hedden had sketched out a range of new projects the Port Authority might undertake in the postwar era. Now, four years later, important steps had been taken in two arenas. Constructing alliances with business leaders and newspaper editors in the region, and with the nation’s airline executives, Tobin and his colleagues had outmaneuvered and neutralized their opponents in New York City and across the Hudson. Their coalition-building strategies were aided by an early and sustained effort to define the airport problem as a regional issue; in this way, they structured the world, as Riker suggests, so as to give them a significant advantage over those who wished to define airports in “city” terms—as an

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important part of how a city defines itself and of the visions and strategies its officials might have for economic development. That “regional” definition was hardly inevitable; witness the early and continuing conflicts over airport development in the San Francisco-Oakland area and in the bi-state St. Louis metropolis.90 New airport projects in two states, together with marine terminals in Newark, entailed a tremendous change for an organization that had focused for a decade on collecting bridge-and-tunnel tolls, while offering only studies and advice on other transportation matters. However, once the airports and Newark’s seaport had been absorbed, Tobin and his colleagues were ready to reach out more widely. The Authority’s growing financial resources would permit them to explore other possibilities, where revenues might in time match investment; and by the close of 1947, several additional projects seemed to be within their grasp. One major target, of great interest to Tobin and his seaport planners, was New York City’s waterfront. In the postwar world, the local administration faced the problem of modernizing the city’s 200 docks and piers, while handicapped by the same financial and managerial limitations that had blocked its airport hopes. Once again, as with the City Airport Authority, a separate government entity—dubbed the World Trade Corporation—had been created by state legislation; and in the summer of 1947 it proposed a $200 million rehabilitation program at the docks, financed with its own revenue bonds. The Port Authority, while declining to study New York’s pier situation unless asked, expressed serious doubts about the World Trade Corporation. Chairman Howard Cullman thought it unwise to have a second port-development body in the New York region; that might lead, he said, to “cut-throat competition” between the two agencies.91 Although some city officials objected to offering the Port Authority a chance to carry off New York’s fabled piers along with her airports, O’Dwyer finally approached Tobin and on October 20, 1947 formally asked the Authority to study the problem of pier modernization and come forward with an offer.92 O’Dwyer’s letter arrived on Tobin’s desk as the Newark agreement was signed. Now Tobin and his aides could look in a sustained way at the immense challenge of New York’s marine terminals, and consider it also in the light of other projects underway and other tasks that might soon be added to the Port Authority’s ledger. As Tobin looked about the Port District in the fall of 1947, he could count—in addition to the airports, the Newark seaport, and the New York waterfront study—three major programs in various stages of negotiation and development.

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11-3. Austin Tobin and Meyer Ellenstein

First there was the Hoboken pier study. In December 1946, the city fathers of this small New Jersey community, directly across the Hudson from Manhattan, had asked the Port Authority to consider whether it could take on the job of revitalizing the Hoboken waterfront. Responding with enthusiasm, Tobin and his aides had put together a $17 million proposal involving rehabilitation of three piers, and construction of a large new double-deck marine terminal—which would become the “most efficient and modern pier” in the New York harbor. The plan was laid before the Hoboken Commissioners in September 1947, and since it offered lease terms similar to those agreed to in Newark, there was hope of prompt approval by the City.93 Then there was the gigantic bus terminal the Port Authority wanted to build in Manhattan, to remove interstate buses from the congested midtown area. By 1947 the number crossing the Hudson into Manhattan exceeded 2,500 each day, and there had been demands since 1940 that these large buses be kept off city streets. In 1945 Tobin had sketched out a specific proposal, but the Greyhound Corporation had opposed the Port agency’s plan, and Robert Moses had taken the lead in 1945–46 in attacking the project.

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The Port Authority responded by building another coalition to advance its cause, and by the fall of 1947 all the roadblocks to “the world’s greatest Union Bus Terminal”—which would cover 160,000 square feet of mid-Manhattan and bring buses directly in from the Lincoln Tunnel—appeared to be removed, and construction, it was expected, would soon begin.94 Finally, there were two truck terminals—immense structures, one in Manhattan and one in Newark. Before the start of the War, Hedden and his staff had explored the possibility of constructing giant truck stations, which could gather over-the-road freight brought from around the nation, for delivery in the New York region; and the Tobin-Hedden 1943 report included these and the bus terminal as important postwar projects. In 1945, the Board and both cities had approved plans for the truck terminals, and during 1947 construction began. The Manhattan terminal would occupy three city blocks near the Holland Tunnel, include 144 truck bays, and have a freight platform 800 feet in length. But the Newark truck station would exceed even those dimensions and be “the largest in the world,” with 160 truck parking spaces and a freight platform 1,000 feet long, extending across 29 acres in all. Tobin and his colleagues expected the two terminals would be self-supporting financially, and there was some hope that these would be the first in a “series of union truck freight stations” which the Port Authority might build across the region.95 Behind the airport and seaport plans, the bus and truck terminals, and other possibilities that Tobin and Hedden and their associates sketched out in their heads and on paper stood the immense and growing revenues of the Port Authority. Fueled mainly in these early years of the Tobin regime by automobile, truck, and bus traffic across the George Washington Bridge and through the Lincoln and Holland Tunnels, the Authority’s revenues responded to the growing rush of postwar travel. In 1941, the last peacetime year, 30 million vehicles had crossed Port Authority facilities, and though traffic dipped during the wartime doldrums, that total had been reached again in 1945. The 1946 figures were 41,200,000, an all-time high, and in 1947 another record was set with 44,500,000. At the end of 1947, operating revenues broke all records with a total of $28.6 million. And since operating expenses absorbed $8 million, and interest and related payments $10 million, more than $10 million remained—from 1947 revenues alone—to provide backing for existing bonds and for new bond issues in support of new Authority initiatives.96 The Port agency’s large revenues and wide-reaching plans made it vulnerable to critics—the Newark commissioners, for example, the editors of

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the Bayonne Times, and Robert Moses—who charged it with self-serving ambitions. But the Authority’s friends had a plausible response. As the Newark Star-Ledger commented in weighing criticisms of the agency’s airport and seaport plans: “The Port Authority is not a profit-making, private enterprise. It is a public agency, and has no selfish motive. . . .” The Port Authority was also vulnerable to exorbitant demands; if it was so wealthy, why should not Newark, and Hoboken, and New York City and others hold out for much higher lease rates and other benefits than those offered by the agency? Here the Port agency found it advantageous that it used bond financing, for the bondholder could provide a ghostly caution—and, if pressed, a real constraint—against emptying the agency’s “profits” into the treasuries of eager cities and towns. Again, the Star-Ledger made the point, in explaining why the agency resisted increasing its payments to Newark: “The Port Authority’s motive is to create a setup with respect to this new project that will not discourage prospective bond purchasers. If the Port Authority pays out too much money, it may find itself driving [them] away.”97 A crucial factor in any plan to extend the Authority’s responsibilities still further would be the attitude of the Board of Commissioners. During the spring of 1947, when Mayor O’Dwyer had finally succumbed to Tobin’s blandishments and yielded his airports, Tobin had taken the occasion to praise the commissioners—and to prepare them for new efforts and, when necessary, new battles. Since early 1945, he noted to the Board, the commissioners “have been unanimous” in rejecting “a static role as a toll collection agency” and in accepting “the dynamic challenge” of reaching out for new projects. “The bridges and tunnels are to be looked to not as an end in themselves,” Tobin wrote, “but rather as the credit basis of a vital and expanding program . . . throughout the greatest metropolitan area in the world.”98 Behind these projects and plans and financing stratagems—more important than any of them and more important perhaps even than the crucial support which Tobin received from Cullman, Byrne, the other Commissioners and the bondholders—was the Port Authority career staff. Numbering 1,030 when Tobin assumed the helm in 1942, the staff had grown to 1,500 in 1946, and during 1947 hundreds more were added to meet the engineering and operating tasks at three airports and the Newark seaport. More important than the numbers, now nearly 2,000, and their quality (which was judged strong by outside observers) was their energy, dedication, and morale. And those characteristics appeared to be connected closely to Tobin’s style of leadership. He worked extremely hard—night and day, it seemed—and he reached out and grappled with the complexities of engineering, finance, planning

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and operation that confronted his staff; and usually he could stay on top of the details as well as the broad issues. Tobin called upon his associates to work as hard as he did, and he was impatient of staff delays in completing assignments; but he applauded their efforts and successes, and he told the commissioners and the public, through the press, of their work. He learned the names of traffic officers, secretaries, and other staff members at positions high and low throughout the organization, and he spoke with them—not just to them—as he visited offices, bridge crossings, and construction sites.99 In 1944, Tobin and the commissioners had established Port Authority Service Emblems to be worn by employees who had been with the Authority for five years or longer, a Medal of Honor for employees who had carried out meritorious acts at personal risk, and the Distinguished Service Medal “to recognize exceptional service of employees on the job.” The commissioners awarded these medals at large staff gatherings, and Tobin often spoke too. There he would avoid the somewhat stiff set speech that was becoming his hallmark in public ceremonies. He spoke informally of the medal winners, and of the importance of the staff, and of his aspirations for the Port Authority and the New York region, and those who listened could hear the energy and enthusiasm that had made him a leading orator in high school 25 years before; and his voice and hopes were infectious.100 “Morale was very high,” recalls one of Tobin’s close associates in the late 1940s. “People at the Port Authority were not only very respectful of Austin Tobin; they loved him dearly.”101 Those outside the agency, who worked with staff members on planning or legislative or engineering tasks, also came to recognize the attitude that seemed to pervade the Authority, and their perceptions helped to clear the way for Tobin and his aides as they sought cooperation and support in the region and in Albany and Trenton. As a top aide to Governor Dewey recalls: “I did not have much direct involvement with Austin Tobin then. But I worked closely with a few staff members and I talked occasionally with others. I could see that they had tremendous esprit, and that Tobin was the spirit that moved them. He was deeply revered.” “So I became biased toward the Port Authority,” he remembered. “With that kind of leadership and dedication their great powers didn’t worry me. Their independence seemed to me better than permitting political control and political inroads.”102 In Selznick’s terms, large portions of the Port Authority staff no longer viewed their work simply as a “job.” It had become a “valued source of personal satisfaction”; an organization was evolving into an institution. For some

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who knew of Tobin’s painful break with the Catholic Church, the Port Authority seemed to be his re-creation of that community, now lost to his sight.103 With many projects now underway and on the drawing board, with the strong support of the commissioners and the dedicated efforts of his staff, it was not surprising that Tobin was in an expansive mood when he spoke to the state-wide meeting of New Jersey realtors near the end of 1947. Reviewing the several marine terminal projects before the Authority, Tobin said that they would “embrace all our dreams” regarding the “historic development of the entire area as a seaport.” And he spoke too of yet another opportunity— a rapid transit line between Bayonne and Jersey City. A close study of that project had been deferred in recent months, Tobin explained, because the engineering staff had been absorbed in airport and seaport issues, but he hoped to have a report ready quite soon. The Authority’s annual report expressed the same optimistic tone: “Perhaps never before have the fundamental purposes and usefulness of the Port Authority been so fully recognized by the people of the Port District.” And the Authority’s credit position—the “best in our history”—would “enable us to go forward with the further development of great terminal projects.”104 Even as they inventoried their strengths and weighed the opportunities before them, Tobin and his colleagues were suddenly caught from behind, dragged into a conflict they had not expected. Through all of 1948 and much of 1949, large portions of Tobin’s emotional energy and the work of the agency’s top leaders would be absorbed in an exhausting battle with Juan Trippe and his fellow airline executives. Those valued members of the alliance that had wrested the airports from Newark and New York would now be enemies; and the Port Authority would be compelled to construct another national coalition, drawing on its political experience in the 1930s, in order to defend its avowed principles of independence, efficiency and equity. That wrenching battle, which ended only when Governor Thomas Dewey forcefully intervened, is the subject of the next chapter.

12 Breaking an Airline Monopoly

The big airlines want special privileges and special rates at Idlewild in unfair competition with the small airlines. . . . Having barnstormed and blitzed every city in the country for one of the greatest free rides in transportation history, their appetites at the public trough are insatiable. —Howard Cullman, Jan. 17, 19491

Leaders, whatever their professions of harmony, do not shun conflict; they confront it, exploit it, ultimately embody it. —James MacGregor Burns2

B

y the late 1940s, it was a central principle at the Port Authority that no new project would be undertaken unless it was expected to become financially self-supporting. In pursuit of that commandment, at every stage Tobin urged the staff to find ways to reduce project costs and to increase project revenues. However, the Port Authority’s goal was “self-supporting in the long run,” and so the staff was encouraged to look beyond the current year, and even beyond the current decade in achieving that goal. In addition, since technological change seemed a crucial aspect of twentieth-century transport, thinking at the agency tended to focus on ways to use evolving technology—and even to help create new technology—in order to improve service, attract more customers, and thereby reduce unit costs. Pursued in a disciplined and unremitting way, the agency’s efforts would in time yield more revenues than expenditures, and the project would more than cover debt service, becoming truly self-sustaining. At least that was the hope which Tobin and his engineers, his management experts, and their compatriots held in the 1940s, the 1950s, and far beyond. The term efficiency was often used to capture this perspective: what the Port Authority sought was an efficient transportation system—composed of an effi288

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cient system of air terminals, an efficient highway system, and so forth; and through strategies to improve efficiency, the project or program would become economically self-supporting. Activities that could not be expected to achieve that result in the long run must be allocated to public agencies that could use tax revenues to meet continuing deficits, not to the Port Authority.3 From the Port Authority’s vantage point, one important route to a more efficient transportation system was the creation of consolidated terminals— places where goods and people could be gathered from across the vast region and beyond, and then sorted and dispatched in common groupings to their destinations. Stated in this abstract way, the concept seems especially to apply to freight; and of course the Port agency had its origin in the campaign to create union terminals, with unified sorting yards and tunnels, for rail freight. In a large and congested region, consolidated truck terminals might also be attractive as a way to reduce traffic congestion in making freight deliveries. The concept could be applied to people as well; consolidated bus terminals could be viewed as desirable projects for gathering and sorting passengers bound for different places, and desirable too in reducing street congestion caused by waiting buses and passengers. By the 1940s air terminals had become yet another centralized approach for “processing” people and goods. And in the 1950s, the world trade center proposal would be promoted as a way to improve the efficiency with which information regarding regional commerce could be gathered and exchanged, advancing the New York region’s position as a central player in world trade. However, in the 1940s (as in the 1920s) the bi-state agency demonstrated an understanding of how to achieve transport efficiency that was quite at variance with the views, and the working habits, of leading figures of American industry. As noted in chapter 5, the Port Authority’s leaders adopted what they sometimes called a “public utility” concept of their enterprise. They applied principles of rational planning, viewed regionally, in order to identify the transport networks and terminals which should be designed, constructed, and modified and then used cooperatively by shippers and manufacturers. This approach had shaped the Port Authority’s 1921 Comprehensive Plan and its related campaigns to open the Hell Gate Bridge to all comers and to substitute a unified service for the hundreds of railroad barges that criss-crossed the harbor. The public-utility perspective also motivated its efforts to construct the Manhattan rail-freight terminal at 15th Street in the 1930s, and justified its bridges and tunnels to serve trucks and other motor vehicles as part of the public highway system. In the 1940s, the two truck terminals, the Man-

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hattan bus station, and the three air terminal projects marched under the same public-utility banner. In contrast, the leaders of the nation’s airlines breathed the air of free enterprise that had sustained the railroad executives before them. Both were committed to the view that the search for individual benefit, and vigorous competition for advantage, would best serve the cause of progress and the mission of American capitalism.4 If we look more closely at the “capitalist ethos” which shaped the behavior of leaders of the large airlines and bus companies, we will discover that they sometimes advocated “competition” while fighting for privileges that would undermine that ideal. One of the key strategies for those who wish to monopolize an industry is to erect barriers to entry—enforced, if possible, by the power of government—so that new competitors are blocked out or, if they are admitted, are forced to compete at a severe disadvantage. This is one way to understand the extended battles against Tobin’s Port Authority by Pan American, United, and the other large airlines, and by the Greyhound Bus Company. These large private firms were fighting to maintain special advantages that would undercut competition; and the Port Authority emerges, in this interpretation, as the defender of competition—urging policies that would encourage new airlines to enter the field and that would allow bus companies to expand and compete on equal footing. Perhaps this theme is consistent with some of its arguments in the 1920s, when it advocated opening the Hell Gate Bridge to all competitors, and favored union rail terminals and public (not private) bridges and tunnels across the Hudson. But the Port agency’s advocacy of open competition is even clearer in the cases examined below. It is ironic that the Port Authority, an advocate of competitive vigor in the wider economy, also sought and received safeguards against competition in its own sphere within the region. Yet, in the Port Authority’s understanding, the intertwined goals of self-supporting enterprises and efficiency required that it be provided with some monopoly protection. The need for legislation to provide the Port agency with selected “monopoly powers” became evident in the 1920s, when it explored the possibility of issuing securities to pay for building the Staten Island spans and the George Washington Bridge. Prospective bondholders were concerned that competition from the Holland Tunnel and from private bridges or tunnels might lead to competitive toll reductions, undermining the agency’s ability to meet bond payments; to moderate this concern, the two states passed legislation guaranteeing that no competing private or new public spans would be permitted. The monopoly question was also

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raised when the Port agency made plans to take over the Newark and New York City airports; in this case, those who spoke for the bondholders hoped for the protection of state laws, similar to the bridge legislation, but they had to be satisfied with city guarantees in 1947 that competing airports would not be created in Newark and New York City. The Port Authority also demanded monopoly protection before it constructed the Manhattan bus terminal, a controversy examined in the next chapter.5 Drawing upon its Progressive Era heritage, the Authority argued that it could operate efficiently only if it were granted a high degree of political insulation. The importance of safeguarding the Port Authority’s activities from local politics had become evident to its friends in the long battle to create the agency against the opposition of the mayors of New York City and Jersey City. Then, during the 1920s and 1930s, patronage had made inroads at the agency. However, the new leadership of the 1940s—Cullman, Byrne, and Tobin—repaired the rents, and they fought successfully, under the dual banners of “regional cooperation” and “nonpolitical efficiency,” to capture the region’s three major airports. The destructive competitive actions of individual cities undercutting one another could be ended, they asserted, by yielding control to the nonpolitical experts of the Port Authority. So could the heavy burden of patronage and special dealing seen in the city departments that ran Newark’s (and New York’s) marine terminals. Moreover, they argued, it was essential that the Port agency be permitted to select its staff, set rental rates to recover costs, and award contracts without interference; only with this freedom could it attain the level of efficiency that was essential for achieving that long-term goal—self-supporting programs to aid the region’s development, provided “without adding to the tax burden.” Indeed the pressure to make airports and other facilities self-sufficient was driven significantly by political realities associated with these themes. If the Port agency were compelled to ask for continuing financial contributions from state or local governments, its actions would be subjected to the vagaries and political bartering of the legislative appropriations process. Then its image as a “nonpolitical” government actor would almost certainly be compromised.6 Throughout the 1940s and beyond, the Port Authority and its friends pressed these arguments for political insulation against the concerns of those who found the Port Authority, as they did Robert Moses and his enterprises, too independent to meet appropriate standards of democratic accountability. The search for efficiency, the belief in large publicly operated terminals, the demand for monopoly powers, and the resistance to political incursions—

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all these were major themes of Tobin’s first ten years in power. There were two more motifs as well: the attempt to use equity and general principles of fairness, in setting policies for modern airports, in relocating tenants, and in awarding construction contracts; and the issue of whether Tobin and his aides were too naive, too innocent, making unwise commitments and wasting essential political capital as they confronted crafty and sometimes abusive leaders from the airlines, in the labor movement, and along the corridors of political power in Albany, Trenton, and Washington. In this chapter and the next we examine these several themes, mainly by exploring two major battlegrounds of the late 1940s. The first is the sustained conflict between the Port Authority and the large airlines, focused on the airport leases that had been signed by Mayor LaGuardia in 1945. Here we will see the adroit tactics the airlines used to undermine Tobin’s moral independence; Tobin’s attempt to articulate a “public utility” view of air terminals, in conflict with the individualist views of Juan Trippe, Eddie Rickenbacker, and other airline pioneers; and Tobin’s successful effort to defend principles of equity for airport governance, reclaiming ethical leadership. During the conflict, the preemptive purchase of Teterboro Airport reveals significant weaknesses in the fabric of his staff expertise; and Governor Dewey’s active intervention reminds us of limitations on the Port Authority’s independence. We also follow the creation of a national alliance, using the political strategies hammered out in the fight with FDR in the 1930s, which in time would bring Juan Trippe and the other rugged individualists to their knees. Next we will explore the many-headed hydra that was the Manhattan bus terminal, reflect on the ethical issues raised by the bus-terminal case, and briefly summarize the unhappy results of the Port Authority’s attempts to add a series of truck terminals, and the seaports of Hoboken and New York City, to its string of successful projects.

From Allies to Enemies: Public-Utility Vision Meets Capitalist Ethos “The airline executives thought he [Tobin] didn’t know what league he was batting in. . . . He would be no match for an aggravated Rickenbacker or ex–two star [general] C. R. Smith.”7

In the Port Authority’s campaign to take control of the region’s airports, the bi-state agency had been fortunate enough to find friends who violated

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Machiavelli’s prediction.8 Eddie Rickenbacker, Juan Trippe, and their fellow executives had been no “lukewarm allies” to Tobin and his team, for those airline pioneers could see clearly how they might profit from a new system. The Port Authority would take airport development in the nation’s largest metropolis out of the hands of city agencies, with their uncertain funding streams and uneven management; instead, expansion and modernization would be the duty of a “nonpolitical” regional government, whose reputation for effective action was matched by its large and growing income. Moreover, that income was drawn mainly from the traffic across its bridges and through its tunnels; and the Port Authority had shown its willingness to use the “excess funds” from those vehicular money-makers to support other projects which might not meet their own costs—the inland freight terminal, truck stations, marine operations, and now, all the region’s major airports. As we saw in chapter 11, the airline executives also found the Port Authority far more attractive than the alternative championed by Robert Moses—a New York City Airport Authority which would have no pipeline to motor-vehicle tolls or other assured sources of revenue. Inevitably, that city authority would have had to find ways to extract more money from those who used the airports, and the airlines were an obvious source, even though they had the “LaGuardia leases,” which seemed to protect them from having to pay more. At this point, the brief comments on the “LaGuardia leases” found in chapter 11 need some elaboration, for the conflict that developed in 1948–49 between the airline executives and Austin Tobin focused on those agreements, and on misunderstandings and miscalculations that arose during the earlier harmonious alliance. The problem had begun in the 1930s, when Fiorello LaGuardia, mayor of New York City and former Army pilot, sought to attract the young airlines from Newark Airport to New York. Success would bring prestige to the mayor and his city, ensure convenient flight service for New York’s citizens (and voters), and add thousands of jobs—especially if American, United, and other airlines could be enticed to relocate their maintenance facilities from Chicago and other points. In LaGuardia’s calculus, the benefits in economic and psychological terms were worth the costs—the expense of building modern airports, and the “below cost” rental rates which he offered to entice the airlines to give priority to New York. His tactics, and the airlines’ demands for special benefits, will be familiar to those who have followed intercity and interstate competition in recent decades to attract corporate offices and plants. The “LaGuardia leases,” negotiated by the mayor and a key associate, Joseph McGoldrick, had finally been accepted by the city and the airlines in 1945;

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and as we will see, the airlines extracted admirable terms for their agreements to favor New York City airports over Newark and other airfields.9 What the airlines had achieved in low-cost leases and other benefits, by playing off Newark against New York City, they had also accomplished in an array of other cities around the nation. Operating as a unified coalition, called the Air Transport Association (ATA), the airlines had negotiated with Chicago and St. Louis, Omaha and Minneapolis, Denver and Salt Lake and other cities large and small, threatening to favor one city over another, and to bypass entirely any regions that were uncooperative. These tactics were successful in the short run, as the airline coalition employed its monopoly power to ensure that—in city after city—the municipalities would be committed to serving the airlines for fees that were below actual costs; federal grants and local taxpayers would have to make up the difference. In recent decades, the subsidy demands and successes of professional football and basketball teams, in negotiating with city governments, illustrate the same pattern.10 When Robert Moses attacked the LaGuardia leases, beginning in the first weeks of 1946, he was raising a matter of local concern, but for the airlines it was also an issue of tremendous national import. Moses argued that the existing leases should be torn up and new agreements signed, with flight fees increased by 20 percent and ground rentals at twice the existing rates; only then, he said, would his new City Airport Authority have the moneys needed to develop Idlewild. However, if the airlines were to yield to Moses, the New York precedent would cast into doubt their agreements in dozens of other cities, and the result might be a sharp increase in their costs nationally. So they rejected his demands. But they needed to ensure Idlewild was in fact turned from a pile of sand into a vast, modern airport, and the Port Authority, with its assured source of outside revenues, was an attractive alternative.11 During the summer and fall of 1946, Rickenbacker of Eastern Airlines and his fellow executives met with Tobin and offered their support for the Port Authority’s airport plans; but they also asked for assurances that the agency would not try to break the existing leases. Tobin’s chief adviser on airport planning was James Buckley, an economist, and he thought the 1945 leases were satisfactory, permitting the agency to develop Idlewild and LaGuardia on a self-sustaining basis. Tobin seemed convinced that the leases would pose no obstacle to his goals, but during the fall he hired outside experts to provide him with their independent judgments. In December he received the results of those assessments, which concluded that the agency had

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considered “all the factors necessary to make the project self-sustaining” and that the Port Authority’s plans should be “commended in that they point the way to relieving the taxpayers of a financial burden without imposing a burdensome charge on the airlines.”12 In response to the airlines’ request, therefore, Tobin had no difficulty in agreeing to send them a letter in January 1947 which affirmed his view: “The Port Authority is definitely of the opinion that these leases are valid. We have premised our revenue estimates on the rates set forth in those leases.” When pressed by Amos Culbert of Eastern Airlines to be more specific on the situation at Idlewild, he then agreed to add a sentence: “Only details would require renegotiation, and these would not involve any increase in rates to the airlines for services or space at the airport.”13 In return, as described in chapter 11, the airline executives took an active part in the campaigns on both sides of the Hudson—attacking the Moses airport authority and endorsing the Port Authority’s plans, working closely with Tobin and O’Dwyer’s aides in order to produce agreement in March 1947 on the takeover of LaGuardia and Idlewild, and then pressing Newark to embrace the Port agency’s plans when its officials hesitated in the weeks before the final agreement was signed in October 1947.14 Once the bi-state agency had captured the New York airfields, the airline executives began to worry anew about their leases. They had Tobin’s personal assurances; but if he were overridden by the Board of Commissioners, could the airlines appeal to the courts to compel the agency to adhere to the lease rates? They soon discovered, to their surprise, that the agency was immune from suit! In May, they tried to persuade Tobin and his aides that this was unfair, and that the Port agency should join with them in supporting legislation that would allow the airlines to sue, if the airport agreements were violated. But Tobin rejected that ploy.15 Meanwhile, Tobin made two crucial appointments, in order to add the skills needed to generate more revenue from stores and other nonflight activities at the airports, and to control costs of operation through efficient management. In May 1947, Robert Curtiss, an expert in concessions and real estate, joined the staff, and during the summer, Hervey Law was named director of the agency’s airports. Law was highly regarded in aviation circles for his operation of the Washington, D.C. airport, where he had added concession income and used management-control strategies to bring the airport to a break-even status. Neither Tobin nor Buckley had any direct experience in airport operations or finances; in estimating airport traffic, revenues and costs, Buckley had largely drawn on general principles of economics and on

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his wartime experience with lend-lease operations. Now Tobin had two men with extensive experience in the fields crucial to achieving the self-support goal; and soon after Labor Day the disaster embedded in the LaGuardiaMcGoldrick leases was uncovered.16

Bias in the System In late September, Tobin sent a dose of bad news to the commissioners. “We inherited a schedule of charges” at the airports, Tobin wrote, which “bears no relation to air carrier revenues, or to the weight of aircraft, or to the wear and tear on the runways, taxiways, and aprons.” Under the LaGuardia leases, which Tobin had endorsed eight months before, the rates were very low, and they were fixed for the next 40 years. In July 1947, for example, American Airlines had 4,500 domestic landings or takeoffs at LaGuardia, for which it paid the airport operator (now the Port Authority) only $4,400; Eastern had 1,800 flights and paid the agency just under $1,700. Moreover, each airline paid a fixed sum for its initial scheduled flights, and declining amounts per flight thereafter; as a result, the system “discriminates rather than encourages smaller carriers” which had only a few flights. The great differences among airlines were displayed in a table, reproduced in part below, which made clear why Eastern, American, TWA, and Pan Am had taken the lead in befriending the Port Authority and in pressing Tobin to sign the January letter. This system, which had been incorporated into the leases for Idlewild as well, violated the general principles to which the Port Authority was committed: “operation of the landing areas . . . along the lines of a public utility equally available to all at prices fair and equitable to all.”17 While the flaws in the airport leases seemed evident to Tobin and his colleagues, it was less clear what should be done to correct them. Eastern and the other large carriers resisted informal requests that they yield their advantage, and having signed the January letter Tobin was reluctant to adopt the Moses strategy and simply tear up the leases. Instead, once the Newark agreement was signed in October, he decided to apply a modest amount of public pressure. Speaking to business and civic groups, Tobin described the large capital investments the Port Authority planned to make in all three airports, and the plans to develop extensive nonflight revenues to meet 60–70 percent of airport costs; he also noted that the agency would spend $75 million for new “hangars and base facilities for air carriers”—“if and when” the airlines agreed to new leases that would cover the total costs of such improvements.18

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table 12.1 Flights Into and from LaGuardia Airport, with Costs per Flight (1947) Domestic flights Eastern American TWA

Plane movements (July)

Paymt to PA per plane mvmt

1,860 4,566 1,264

92 cents 98 cents $1.41

. . . [five airlines omitted; final two below paid highest rates] Trans-Canada Northwest

306 312

$3.92 $4.56

594 230

$4.72 5.01

Overseas Pan American American

. . . [six airlines omitted; highest rate below] British

54

$43.06

To the airline executives, however, Tobin’s concerns were only the grumbling of a government bureaucrat who had signed away his right to change the traditional ATA lease. The “rugged individualists” who ran the airlines had been driving hard bargains with inexperienced city officials for years, much to the advantage of the large carriers, and Tobin was simply the latest captive in the web. They considered Tobin’s view that his agency should treat “all our customers on the basis of equality” as “piffle . . . another big indication that he just didn’t understand what league he was batting in.” And if Tobin tried to “get tough with the airlines,” as one former airline executive recalled, he was viewed as a “non veteran” and “no match for an aggravated [Captain] Rickenbacker or ex–two star [general] C. R. Smith.” Besides, Tobin ran an agency with “ready access to untold millions from bondholders” who were “eager” to finance Port Authority projects, so he didn’t need more money from the airlines.19 But here the strategic sense of the “rugged individualists” went slightly awry. In pressing for Tobin’s commitment to the old leases, while he was unaware of the weaknesses in those agreements, they had won a tactical victory in January; but Tobin soon concluded that they had intentionally deceived him, and now they gained an enemy, in a deeply personal sense. As one of his long-term aides recalled, Tobin felt he had been “badly betrayed” by Culbert and his allies; he never fully trusted the airline executives and negotiators again.20

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If the airline executives were concerned that changes in the New York leases would set a precedent other cities might learn about and follow, perhaps it would have been wiser to work out improved leases with Tobin and his aides in the quiet of their boardrooms, rather than choosing the path of confrontation. For Tobin was unusually dangerous to the airlines. As Trippe and his colleagues knew from their own involvement in the recent battles with Newark and New York officials, Tobin relished a good fight, he was willing to speak out publicly, and he was stubborn. What they had missed, perhaps, was his deep experience in honing political tactics which could be employed against the airlines’ monopoly power. If pressed, Tobin might construct a national alliance of the kind that had defeated Franklin Roosevelt in the municipal-bond fight a decade before.

Strategies Local and National They seek to force upon us a new system, not contemplated in the leases, but borrowed from Europe. . . . It is an attempt to force on us at this critical stage an ideology never contemplated in the leases as they originally accepted them. —An attorney for U.S. airlines21

In January, 1948, Tobin wrote to executives of the twenty largest airports in the country, suggesting that they form a new organization which could serve as a “much needed medium for the exchange of information and experience” among government agencies that operated airports. This would, as it turned out, be the first step in constructing a nation-wide coalition that could challenge the airlines’ hegemony.22 Tobin still hoped that behind-the-scenes negotiations would lead the airlines to revise the old leases in a cooperative spirit—accepting the principles of self-supporting airport development and nondiscrimination in landing fees. The need to find a more equitable way to set landing charges and allot other costs among the various air carriers was, to Tobin, a simple matter of fairness; when the issue was made clear to upright men like Trippe, they would surely accept that view. Moreover, the goal of raising the general level of charges to the airlines was of crucial importance not only to the Port Authority but to the airlines as well, if they wanted to expand their business and profits. The traditional pattern, with city officials providing low-cost landing fees, hangar rights, and other facilities, meant that by the late 1940s, airlines were paying only about 10 percent of the cost of operating most air-

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ports around the nation. The deficits were met through taxes levied on the local citizenry, who had been eager to have air service; but there was increasing resistance to continuing that form of airport—and airline—subsidy. At the same time, airlines were adding more planes and larger planes in these early postwar years; to earn reasonable profits and expand their services further, the airlines needed airport operators which could invest millions of dollars in longer runways, new buildings, and other elements of a modern airport. Looked at in isolation, the airlines’ desire for modernized airports in the New York region seemed likely to be satisfied, for the Port Authority did have access to other revenues; moreover, it had attracted a corps of new staff members who were already, at LaGuardia in 1947–48, using imaginative methods to add to nonflight income. However, most airports were not operated with these advantages; if the airlines won their battle and kept the old tradition of low-cost, 40-year leases, they would find horse-and-buggy airfields in most cities, and no place to land the larger planes like the Stratocruiser that were about to be delivered to American and the other large carriers. What the airlines needed, and the airport operators too, was a system of flight charges and other fees that would—if combined with aggressive, entrepreneurial steps to expand concession revenue—render the nation’s airports self-supporting. This would allow air terminals to be expanded and modernized without relying on the hazardous annual trip to the taxpayer’s pocket. At least that was how Tobin and his aides viewed the issue, and so they entered into a sustained effort, in the first months of 1948, to persuade the airline executives and their lawyers to see principles of fairness and their own self-interest in this light.23 At a meeting in mid-February with airline executives and several of his own commissioners, Tobin laid out these views at length. He described the successful efforts by the Port Authority to increase income from stores, parking, and other sources, and he said that he hoped 60–70 percent of overall airport costs could be covered by such nonflight income. He argued that both the Port Authority’s general philosophy and political reality required that the airports in time be self-supporting. He expressed sympathy with the large airlines’ successful efforts to win special benefits in their earlier leases, but he insisted that could not continue.24 Tobin then pointed out that the “whole future of air transportation” depended on finding ways to make air terminals self-supporting financially. His assessment continued:

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there are 17 major air centers whose air traffic by 1950 should require greater airport capacity. . . . practically no construction going on to meet this demand—financial inability of the cities. . . . state and municipal enthusiasm for making up the deficits out of taxation is no longer evident. . . . we are mutually dependent—unless the airline industry prospers we will not have self supporting airports—unless the airports are self-supporting their inadequacy will stultify the great future of the airline industry.

At the conference, C. R. Smith and Rickenbacker expressed concern that Tobin’s approach to revision was so broad as to “constitute, in effect, a repudiation of the 1945 agreements.” But after the meeting and separate conversations in the next several days, Tobin seemed encouraged by the willingness of some airline officials to consider revising the old leases.25 Despite further meetings and exchanges of letters during the spring, however, the U.S. airline executives did not budge from their position that the low landing fees and other stipulations in the 1945 leases were inviolate. The firmness of the coalition was underscored when the Port Authority asked the domestic and foreign airlines what hangar space, passenger counters, and other areas they wished to lease at Idlewild, which would open in July 1948. All the U.S. carriers filed applications, but they included identical wording stating that they would sign on at Idlewild only if the Port agency would be using the principles agreed to in 1945. Several foreign-flag airlines omitted that condition, and they were then given “preferred choice of space” at the new airport, while the others were “advised what space remained available.”26

The National Coalition Takes Off Meanwhile, in response to Tobin’s January 1948 letter, the directors of the country’s largest airports had begun to organize and exchange information. The executives created an “Airport Operators Council,” which held its first full meeting in Boston in April, with 136 attending from 19 major airports. There was wide agreement that they had been at a disadvantage in negotiating individually with the airlines’ unified team (the ATA); and that lack of information about leases at other airports, and the fear of not having adequate service, had led most cities to sign agreements with the airlines that priced airport services well below cost. However, Tobin and his fellow airport directors were pleased to learn that the standard ATA lease, which had provided the basis for the LaGuardia agreements in 1945 and similar leases across the nation, was not everywhere in use; managers in San Francisco and

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Minneapolis–St. Paul had persuaded the airlines to sign leases that would be far more likely to permit those airports to become self-sustaining. A week later, both of those airport directors met with several Port Authority commissioners and staff in New York to describe the negotiating strategies that had resulted in better agreements with the ATA.27 During the AOC conference in Boston, Tobin also met with Governor Robert Bradford of Massachusetts, where the issue of how to pay for modernizing Logan Airport was being debated. Bradford said he was “meeting with the same line of intransigence from the airlines,” and the governor entertained the airport directors with a sharp attack on the airlines and their wily ways. The airport managers’ readiness to confront the ATA was also enhanced during the spring by the discovery that European airports extracted much larger payments, and that charges were adjusted regularly when inflation and other factors had an impact on an airport’s financial health.28 The evolving sense of community among AOC members was reinforced by another nation-wide effort, led by municipal legal officers. In 1947, their national association had begun an effort to protect the cities from ATA pressures by creating a “model” agreement that individual cities and other airport operators could use in negotiating with the airlines. The ATA objected to important parts of the draft, and during the early months of 1948 a revised draft, coupled with extensive commentary on the ATA model lease and ATA negotiating tactics, was prepared by a Washington lawyer, Charles S. Rhyne, in close consultation with Tobin’s legal staff. The report was sharply critical of the airlines, and the foreword included phrasing that would be quoted in Tobin’s reports to the commissioners and in newspaper reports during the next several years: The airlines have run roughshod over cities and have undoubtedly contributed in a large measure to the financial impotency of municipal airports by reason of inadequate compensation. . . . The so-called ‘Air Transportation Association’ model airport lease agreement is an infamous document that has been widely used by the airlines in their efforts to secure the terms which they desire.29

In June 1948, the Airport Operators Council created a series of committees to examine operating practices, rates and accounting, and other matters. By now, some media support for the AOC and the Port Authority’s organizing efforts was evident. The journal Airports and Air Carriers noted that “the cry has gone up” that the AOC “is the creation of the Port Authority” and that the bi-state agency was using the AOC “as a weapon to force the airlines”

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into new agreements at Idlewild; but the journal then endorsed the AOC as a needed counterweight to the ATA and suggested that ATA negotiating tactics may have compelled the airports to organize too. The New York Times offered a ringing endorsement of the Port Authority’s argument that American airports “must be self-supporting,” while commenting that the airlines “have been bountifully treated . . . by their municipal hosts,” an advantage which must now be ended. And the aviation expert at the Herald Tribune praised the Port agency’s successful effort to increase nonflight revenues, while asserting that “the ultimate test of the genius of the Port of New York Authority” would be the dual challenge of increasing flight revenues and reducing airport costs. Here the reporter took a position that echoed the Port Authority’s general philosophy, nurtured since its early efforts to reorganize railroad terminals: The airlines “have had individual services at the air terminals far too long for their own good,” he argued; it would be much more efficient to have passenger services, gasoline delivery, and other operations in the terminals under the control of the bi-state agency. With the cities no longer willing to subsidize airport operation, the terminals must become self-supporting, the reporter concluded. The alternative would be “nationalization of airports” and perhaps of the airlines themselves.30 In early July, the AOC campaign claimed a significant success, and the ATA saw an ominous portent, as Chicago’s city council adopted a schedule of flight fees and other charges for its new airport “patterned after those of the Port of New York Authority” at Idlewild. Boston and other cities soon followed.31

Counterattack The airlines did not stand by, silent and admiring, as the financial and political structure on which their success had been built began to crumble. In the spring of 1948, when the Civil Aeronautics Administration held a public hearing prior to setting air-traffic patterns for Idlewild, the ATA opposed opening the airport because of its “dangerous” proximity to LaGuardia; but the CAA rejected that plea. In May, a member of Congress from Long Island introduced a bill that would bar federal aid to any airports which charged airlines for supplying gasoline and other services; since the carriers were at the time resisting the Port Authority’s plans to impose such charges, the measure seemed ATA-inspired. The Port Authority attacked it sharply, and it died in committee.32 When the Port Authority proposed that foreign-flag airlines move their operations to Idlewild, the ATA sent out information alleging “unsafe” condi-

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tions at the new airport. Then, apparently at the urging of U.S. airlines, two European air carriers persuaded their embassies to file protests with the State Department, asking that the bi-state agency be prohibited from requiring them to shift from LaGuardia to Idlewild; but State conferred with the Port agency and rejected the protests.33 With Idlewild scheduled to open in July, the airlines had created a full boycott, in the hope that the new airport would open with no scheduled air service. However, once the State Department said it would not intervene, the Authority compelled Air France, and the other foreign-flag carriers that did not have long-term LaGuardia leases, to shift to the new and larger airport, and the boycott was undermined.34 The U.S. airlines also explored an alternative strategy which might weaken the Port Authority’s negotiating position. In his earlier discussions with airline executives, Tobin had indicated that the bi-state region needed four major airports, with the location for the fourth—in the northwest sector—not yet identified. If the carriers purchased and operated that fourth airport on their own, major freight and passenger services could be developed outside the Port Authority’s control, and the airlines could negotiate for reduced charges at the other three airports with greater leverage. Early in 1948, as one airline official recalls, “we took a long look at Teterboro,” a private airport in Bergen County; the airlines though it might be possible to “move entirely to Teterboro.” But the airport was too small; “it could never be adequate.”35 Once again, as it had in endorsing the LaGuardia leases in 1947, the Port Authority demonstrated that its staff expertise was not adequate to the challenge. In March, one of Tobin’s aides talked with Teterboro’s owner and learned that the airlines had been in for a visit. During the next three months, rumors of possible purchase by a group of major carriers surfaced, probably shaped mainly by Teterboro’s owner, who seemed to have just the right technique for encouraging the Port agency’s nervousness. In early August, the Port Authority bought Teterboro for $3,115,000. It would become “one of the four great” air terminals in the New York region, asserted James Buckley, now director of airport development.36 But in fact Teterboro would never become a major airport. Even when expanded, its runways would be difficult for large planes to use; and, more important, takeoffs and landings would conflict with airspace for planes using Newark Airport, especially when instrument landing was required. Although Teterboro would always be valuable for nonscheduled passenger service and cargo, its abrupt purchase at a large price in 1948 was the result of

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important miscalculations. Together with the erroneous revenue estimates linked to the LaGuardia leases, these could be laid substantially at the door of airport planner Buckley, and by early in 1949, he was gone. The press, however, dutifully treated the Teterboro purchase as another gem in the Port Authority crown of successes.37 Vexed by their failure to persuade Tobin to accept the ATA position, the airlines tried other ploys. As the first installment of Air Terminal bonds was issued in June, ATA aides allegedly spread rumors suggesting that those securities were not a sound investment. However, the Port agency had secured its new bonds directly to its large general-reserve fund and safeguarded them in other ways; so the first round of bond sales took place without difficulty. The airlines also appealed to Mayor O’Dwyer, asking that he endorse the LaGuardia agreements, but O’Dwyer criticized the old leases and rejected their request. Then Rickenbacker, Trippe, and their fellow executives demanded that O’Dwyer intervene to stop the Port agency from an “organized campaign of harassment” undertaken at the airports, which (they said) was forcing the airlines to shift maintenance work away from New York; but that tactic also failed.38 In the battle for media support in the summer of 1948, the Port Authority seemed to have the stronger hand. In August, the Wall Street Journal carried a long article which described the Port agency as a “trail-blazer” in the national effort to get air terminals “out of the red” and noted that its “new theories on airport management” were being applied in Chicago, Boston, and other cities. The airlines’ public appeals to O’Dwyer offered their antagonists another opportunity to attack the air carriers, and Howard Cullman, abetted by the region’s journalists, fired away, quoting the report by Charles Rhyne which labeled the ATA model lease as “an infamous document,” and asserting that the threat to move airline jobs was a standard ATA ploy being used not only in New York but also in Boston, Minneapolis, Chicago and other cities.39 The airlines’ attempts to bring the State Department into the fray on their side had an even less satisfactory outcome. When the European carriers had incited diplomatic protests in June, the ATA hoped that State would endorse the right of foreign-flag airlines to stay at LaGuardia, so that the full boycott of Idlewild might be maintained. That attempt was unsuccessful; and some weeks later the U.S. carriers realized that the actual result had been to weaken their position—for the State Department had endorsed the Port Authority’s preferred position, that all airlines must soon transfer their overseas flights from LaGuardia to the new airfield.40

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With Cullman and Tobin leading the attack, the Port Authority appeared to be a unified monolith. But was this really so? During the fall of 1948, the airlines tried another tactic, hoping to drive a wedge between Tobin and some of his commissioners. In October the airlines added A. Harry Moore to their legal team; as governor of New Jersey in the 1930s, Moore had appointed Vice Chairman Joseph Byrne to his initial term on the board, and there was some hope that he might persuade Byrne and one or two others to support the airlines’ position. The airlines’ chief negotiator, George Whiteside, apparently informed Tobin that he and Governor Moore would feel free to discuss their concerns about Authority policies in separate meetings with commissioners from both states. Whiteside then met with the commissioners in early November and urged that they endorse the general principles found in the LaGuardia leases. And when that step failed to break the agency’s unified stance, the airlines threatened to bring suit individually against each of the commissioners.41 But none of these efforts seemed to budge Tobin and his colleagues from their stubborn insistence that the old leases be replaced with new agreements, and that the new leases be based on the principle of equity for all airlines and on a schedule of fees which would make self-sustaining airports a realistic aspiration. In the fall, when the airlines asked to use Idlewild temporarily “under the terms of the existing leases,” Tobin rejected that request and emphasized the need for equity and adequate income at the airports. When they asked the Port Authority to abandon its plan to add a surcharge if airlines set up their own gasoline delivery or other services, they found that the Port Authority’s surcharge policy was now embedded in the agreement which the agency had made “with the United States of America” for federal aid at Idlewild. When they urged the commissioners to rethink their position, they received a letter from Cullman that assailed the carriers for demanding “rates and charges which would be frozen at non-compensatory levels for fifty years,” and which would give a “privileged status . . . to the larger airlines among your clients.” Cullman reminded Whiteside that the ATA model lease was viewed as an “infamous document,” and that some public officials thought the airlines’ unified negotiating strategy was “a conspiracy” which violated anti-trust laws. Progress could only be made, Cullman told Whiteside, by negotiations with “our Executive Director,” who had the board’s unanimous support. And the Port Authority then made the scathing letter public.42 Late in the fall of 1948, the airlines tried to persuade the interested public that Tobin and his agency should be condemned for unethical behavior,

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because they had reneged on Tobin’s 1947 assurance that there would not be “any increases in rates to the airlines” at Idlewild. That ploy failed to gain much attention, however, and the journalist who gave it most careful scrutiny found Tobin’s letter one of the “mysteries” of the affair, to be balanced against examples of puzzling airline behavior. With their stock of public support declining, and with few tactical strokes left, the major American airlines finally, in mid-December, filed suit against all twelve Port Authority commissioners and against Austin Tobin.43

Deadlock The suit charged the Port agency’s officials with “breach of their duties,” for failing to permit the carriers to use Idlewild under the guiding principles of the old leases. The airlines faced a specific crisis which impelled them to try legal action as the new year approached: three of the carriers were about to take delivery of a new generation of large planes, Boeing Stratocruisers, which were too heavy to land fully loaded at LaGuardia. The Idlewild field could handle the planes; but unless the Port Authority were forced to develop new terminal and service plans (arguably not covered in the old leases), the airlines’ staff and Stratocruiser passengers would find Idlewild’s facilities distinctly limited.44 As the court case opened in January, 1949, the conflict reached “new stages of bitterness.” Howard Cullman attacked the air carriers for their “insatiable . . . appetites at the public trough,” while Whiteside denounced “the dictatorship of the Port Authority” at the airports. After hearing opening statements, the judge asked the two sides to go away and resolve their differences. And Governor Thomas E. Dewey said that he was sure “ancient fetishes” would soon be abandoned and the case settled.45 But Dewey’s optimism was not well founded. Negotiations continued sporadically during the next several months, and neither side would budge on the issue of new leases.46 Meanwhile, the first Stratocruisers began to arrive. They were able to land at LaGuardia, but only if partly loaded. When Pan American asked for permission for one plane to take off with a weight 10 percent over the LaGuardia limit, the Port Authority refused and 10,000 pounds had to be removed before the plane could depart. Pan Am and the other carriers were informed that under the 1945 leases they also had the right to land the new Boeing plane (and other planes) at Idlewild, and to fly out of Idlewild; but that was about the extent of their rights. As Tobin explained to his commissioners:

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While those leases clearly permit the landing of Pan American’s planes and the use of the runways, they include no provisions whatsoever for passenger areas, counter space, or office space . . . nor for cargo handling . . . ; nor do they include any rights or privileges with respect to . . . hangars at the Airport. . . . None of these facilities will be made available to Pan American, or any of the lessee airlines, until the 1945 leases are renegotiated.”47

So Pan Am passengers wishing to take the great Stratocruiser from Idlewild could look forward to huddling together in spring rains, near a runway, waiting for the plane to arrive, ticket in hand, without access to information on any delays, and—for bathroom needs—looking for such trees and bushes as the Port Authority had, in its kindness, left standing along the roadways. In contrast, passengers willing to fly to Europe via KLM or Air France, which had signed new leases based on aircraft weight and equity principles, awaited departure in warm waiting rooms in the new temporary buildings, with coffee shops and other amenities at hand. And so the noose on the U.S. carriers was tightened, and Tobin took some measure of revenge on Trippe, Culbert, and their allies for that tactical victory of 1947. As conditions at LaGuardia grew more crowded in the late spring, and the airlines occasionally landed their Stratocruisers at Idlewild, the frustration of the carriers grew. In early June, Pan American’s president, Juan Trippe, joined with Eastern’s Rickenbacker and several other airline executives in an attempt to persuade Tobin and his colleagues to abandon their stand. Trippe said he was “quite distressed” about the Stratocruiser problem, and that he could not believe the commissioners and Tobin “realized what difficult and onerous terms were being imposed upon him” at Idlewild. Cullman said the commissioners were fully aware of those conditions and they would remain until new leases were signed. There was an extensive exchange of unpleasantries. After two sessions, the airlines broke off discussions and condemned the Port Authority. Whiteside announced to the press that the carriers had agreed to pay higher fees for landing their planes, to reduce the frequentlanding discounts, and to permit the charges to be altered every five years. But the Port Authority, Whiteside complained, “offered no concessions or compromises” during the previous five months. Instead, it has “gone barnstorming around the country setting up organizations and talking up changes in landing fee costs. If its plan is put into effect at [Idlewild], it will be a pattern for the rest of the country.” And that, of course, was what Tobin, and his colleagues, and the airport directors around the country now wanted!48

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As the large airlines struggled to operate at overcrowded LaGuardia and on unadorned Idlewild runways, the Port agency and its friends in the press turned the knife a little. In late June the Newark News reported that while the large carriers were pleading poverty, they were paying large sums to legal firms in an attempt to avoid paying their “fair share” of airport costs. In early July, the Herald Tribune noted that a large number of foreign-flag and nonscheduled airlines were now using Idlewild, and that the Authority had already spent $24 million in developing the airport and terminal buildings, which included a restaurant, a bookshop, and twenty other stores. The Port agency “is steadily building Idlewild Airport to a high peak of perfection,” exclaimed a Long Island newspaper; and “the new airport will continue to grow more and more attractive” because of its “unparalleled facilities.” But Trippe and C. R. Smith and Rickenbacker were not allowed in.49

Governor Dewey Intervenes He thought it was a public scandal for the Port Authority to follow such a policy of harassment . . . that the airlines which were being harassed were headed by outstanding businessmen and that they had valid leases which should be honored. —Port Authority memorandum50

During the early months of 1949, Governor Thomas E. Dewey had become increasingly concerned about the conflict between the airlines and the Port Authority. In January, he had said publicly that the issue would soon be resolved, and six months later no real progress had been made. Meanwhile, he had heard that air traffic to New York was declining, that conditions at Idlewild might be unsafe for the giant Stratocruisers now trying to land at that airport, and that the Port Authority had been using “harassment tactics” against the major airlines. On July 19 or 20, Dewey called Commissioner Bayard Pope, a long-time acquaintance whom he had appointed to the Board, expressed these concerns, and said he was going to “settle the airlines dispute.”51 On July 21, Dewey and his Counsel, Charles Breitel, held the first of three long meetings with the Port Authority commissioners, joined by Tobin and a few members of his staff. At this first session, Dewey “delivered a strong and critical statement” about what he called the “harassment policy” of the Port agency. He asked for a copy of the 1945 leases, and he and Breitel scrutinized them and said that they were certain the Port Authority was obliged to provide “some type of terminal facilities” at Idlewild.52

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Commissioner Pope took the lead in responding, arguing that the airlines “had acted in bad faith on the 1945 leases,” and that the Port Authority was “fighting the airlines in the only fashion it knew how,” which was to “withhold services to which the airlines were not entitled under the 1945 leases.” He pointed out that “this same fight was being carried on all over the country.” He disagreed with the Governor’s view that the Port Authority effort was a “public scandal”; rather, it was what must be done, if airports were to become self-supporting. Tobin then asserted that the 1945 leases accepted by New York City were “the most vicious kind of monopolistic documents ever signed by a public agency.”53 Dewey then appeared to modify his views. He agreed the airports should be self-financing, and he opposed “discriminatory landing fees that were noncompensatory”; but he wondered if New York should try to establish a new approach to airport charges on its own. This allowed Tobin to describe the national scope of the problem and to indicate that “all of the forward-looking airport operators” were now rethinking their landing fees and other policies. He also argued that the Port Authority was “making progress” in persuading the airlines to accept new leases, and he suggested that there was no need for Governor Dewey to intervene; and Commissioner Pope agreed. Now Dewey took a critical stance. He said “he did not believe the agency was sincere in wanting to settle the dispute”; and when Pope suggested that Dewey and the Commissioners really did not disagree on desirable policies to end the conflict, Dewey countered, “But I do disagree.” He then argued that “there was plenty of evidence” the Port agency’s position was “wrong”; the newspapers, for example, “have been against the Port Authority.” Not so, Tobin responded, describing supportive editorials. In any event, Dewey concluded, “this argument could not go on any longer,” and he was going to resolve it quickly. It seemed clear that Dewey was committed to piercing the agency’s independence in negotiating with the airlines; the question was, how far would he go in protecting the airlines and therefore, in effect, in forcing the Port Authority to use its funds to meet airport deficits—limiting its ability to take on other projects. The first meeting had lasted only two or three hours, but the second session, held eight days later, took 13 hours. Dewey placed Juan Trippe, C. R. Smith, and other airline executives in one room, and several Port Authority commissioners and Tobin and his aides in another, and Dewey moved back and forth between the hostile groups.54 When Pope and his colleagues argued that “the Commissioners must have the responsibility for deciding how much money would be spent” to operate the airport, the gov-

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ernor resisted. He thought this “did not provide adequate protection to the airlines,” which were concerned that they would be burdened by airport expenditures that “might not be prudent and efficient.” Then the airlines would have no appeal to any outside regulatory body, Dewey argued; unlike the railroads and the airlines, the Port Authority was “answerable only to God.” Tobin’s general counsel disagreed, noting that the governor had the veto power. Dewey responded that “the veto power was more apparent than real.” Shuttling back and forth, Dewey probed the issue of whether the specific fees the Port agency wanted to levy were justified. He told Tobin and his colleagues that the airline executives were “fine, outstanding businessmen”; and when they described the “methods and tactics” which the airlines had been using, Dewey said “he believed the Port Authority was biased in this matter.” Even so, he accepted the general principle that charges to the airlines should be based on actual costs of developing Idlewild over the coming years, not on flat fees that would be fixed for several decades. Finally the governor brought the two sides together to review the “real progress” that he thought had been made, and to “make sure that everyone was in agreement.” But everyone was not in agreement, and the day’s final meeting lasted four more hours. At 11 p.m., Dewey said there was now sufficient consensus that the issue could be concluded in a final session in early August.55 And so it could—in a meeting at Manhattan’s Hotel Roosevelt that began at 2:30 p.m. on August 4, continued through the night without a break, and concluded finally with a draft agreement signed 23 hours later, at 1:30 p.m. on the 5th. At most points, the agreement was a victory for the Port Authority. C. R. Smith, Trippe, and their colleagues agreed to sign new leases with flight fees determined by the actual weight of the planes, and with no discounts for the major airlines linked to their large numbers of flights. And the airlines accepted basic charges for flights, gasoline, and hangars that were far above the 1945 levels, although low enough that for some years the airports were unlikely to be fully self-supporting.56 For Tobin and others familiar with the railroads’ resistance to joint terminals and services, the airlines’ reactions offered an echo of the Port Authority’s early years. For example, when Dewey brought the two sides together, and Tobin’s aides described the plans for consolidated handling of airline baggage, porter services, and incineration, the airline executives objected—arguing that “they should not be consolidated and that the airlines should have the opportunity of providing these services for themselves.” In

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response, Tobin and his staff said that “such consolidation was both efficient and economical and provided the best type of service for the air passengers and the airlines.” Dewey agreed with the Port Authority, as long as the airlines had the right to appeal to an arbitrator if they thought the charges too high.57 In return for the airlines’ willingness to pay higher fees, the Port Authority agreed to seek legislation which would permit it to be sued. The airlines considered this an important step, since their effort to compel the bi-state agency to adhere to their interpretation of the 1945 leases had been frustrated by its immunity to suit. As Tobin understood, however, immunity would soon be eliminated in any event, since both Dewey and his counsel were strongly committed to that change.58 Dewey announced the agreement that afternoon. He noted that the airlines “will pay very much more” under the plan, which required the same fee for every flight, undercutting “the tendency to monopoly” found in the 1945 sliding scale. “I believe,” said the governor, “the rest of the country will follow the pattern of our airport agreement.” Tobin endorsed the result as “a fine, workable agreement.” Juan Trippe praised Dewey for his efforts to bring the two sides together; but the airline executives did not have warm words for the agreement, nor did they express hope that the rest of the nation would embrace the Roosevelt Hotel treaty. However, the New York Times and the Newark News agreed with Dewey that the Idlewild agreement was likely to have a major impact on airport financing and development nationally.59 As it did. Soon after the August 5 settlement, Tobin sent copies of the agreement to airport managers across the country and to federal officials; and their responses suggested that the principles of the “Dewey leases” were likely to govern future bargaining with the air carriers. By September, the airlines had abandoned their old position. O. M. Mosier, who had negotiated the 1945 leases at LaGuardia for American Airlines, acknowledged that the sliding scale was inequitable, and said that perhaps airport contracts should now be set “on a poundage charge . . . such as that used in the recent renegotiation” of the Idlewild leases.60 Reflecting on the conflict decades later, participants were still able to recall the airlines’ misjudgment of Austin Tobin as “at best a talented lawyer . . . pretending ingenuity and courage while . . . engaged in a simple operation of tunnels and bridges,” as well as Tobin’s “sometimes blind hatred for the airlines, because he felt he had been double-crossed.” Beyond these personal tensions and institutional conflicts, however, they could also see, as one airline official put it, that

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settlement of the bitter Port Authority/Airlines dispute literally revolutionized airport development throughout the United States and many countries overseas. . . . It did sever tradition by placing the airport operator as the dominant force. Second, it made possible and encouraged every major airport to become self supporting by requiring the airlines to pay for their own facilities plus a share of the airport’s cost of administration. Third, it meant that financing of large new airports or rebuilding and expanding of old ones was now readily available.

No one lost.61

Legacy of the Progressive Impulse? Somehow . . . it seemed, ruthless men had usurped the government and were now wielding it for their private benefit. . . . Scientific government, the urban reformers believed, would bring opportunity, progress, order, and community. —Robert H. Wiebe, Search for Order, pp. 6, 170

While Wiebe’s comments are addressed to the reform movement of the decades before World War I, his observations seem to apply as well to the airport dramas of three decades later. The Port Authority, created in the Progressive Era, had been designed to function “above politics” and with rational planners and experts at the helm. Unleashed in the mid-1940s from the control of conservative leaders, it had soon joined in a coalition with the airlines, using their preferences and threats to help beat down the resistance of local elected officials, and so gather up the large air terminals—which might then be separated from the patronage, starved resources, and narrow perspectives of their city owners. Now, with three airports in their pocket, Tobin and his associates were able to construct a national coalition of like-minded local officials, and combine that alliance with the Port Authority’s powerful monopoly position—as owner of all the large airfields in the nation’s major air-traffic center—to break the power of the airline monopolists. In this campaign, as in the battle to win control of the region’s airports, the Port Authority showed that its brand of Progressivism was composed of more than a dose of expertise and a portion of political insulation; its leaders seemed to gain strength from adversity, and to exploit political conflict in order to build wider alliances in support of its preferred goals. This was, in Galbraith’s phrasing, an exercise of countervailing power. In the short run it benefited the airports

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and their cities, and in the longer run, as Robert Tuttle points out, the industry as a whole.62 One of the themes of Progressivism is the replacement of untrained officials, often chosen because of their local party service, by well-trained experts; and here the campaign for change, led by Tobin, Buckley, and the emerging AOC, was closely intertwined with the battle against the airlines. Prior to 1948, the typical airport operator was appointed politically and constrained by local political forces; but within the first few months of the AOC’s formation in 1948, its members were exploring issues of cost allocation and other specialized subjects, while pressing for “businesslike” independence for their airfields and their future profession. These aspirations, nurtured by the AOC fellowship, increased the probability that the new funds made available under Idlewild-type leases would be effectively used to develop modern air terminals.63 The spirit of adventure and the “rugged individualism” of Juan Trippe, C. R. Smith, and their fellow airline pioneers have won the admiration of journalists and other writers for decades.64 By the late 1940s, perhaps those individualists had grown too comfortable with measurements of “success” that were more bureaucratic than adventurous: How small could we keep our payments to the airports, so our yearly profits would be nourished from the taxpayer’s pocket? How large would be the mail payments extracted from Uncle Sam? How sharp could we keep the sliding scale and how firm our control over favored hangar space, so competition could be limited to a cozy few? Perhaps the virus of noncompetitive dozing, which infected the American automobile producers in the 1960s, had a trial run at the airlines in the 1940s. If so, the entrepreneurial energy of the Port Authority’s aggressive staff seemed to provide just the right antidote. It is a further irony that the Port Authority’s valued political insulation had to be pierced, in order to end the contentious stalemate that ran for more than a year and a half. Possibly, as Tobin thought, Trippe and his Stratocruiser allies would soon have capitulated without Dewey’s intervention, and then the other air carriers would have fallen into line. But perhaps Tobin would have been mistaken; with a nation-wide pattern at stake, a conflict that had turned personal, and a short-sighted view of how to expand freight and passenger travel, C. R. Smith and his allies might have held out another year or more, with the air travel industry dragging far below its promise. In any event, as the excerpts from the meetings suggest, Dewey’s intervention in this case appears to have been motivated by a desire to locate and

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enforce the “best decision,” one that would allow the airports to be modernized, without depriving the airlines of moneys they needed to fulfill their part of the bargain—expensive new airships, and advertising which would bring throngs of passengers and freight to those new air terminals. The first Republican governor of New York since Nathan Miller had signed the bill creating the Port Authority in 1921, Dewey was basically an admirer of the agency, and an advocate of efficient and effective government generally. So Tobin and his colleagues had a sort of “thirteenth commissioner” in this case, and the result was one they could embrace.65 A few months later they would feel quite differently, when Dewey’s intervention appeared to be—and probably was—motivated by “low politics”; then his position had to be confronted and if possible overturned. But that is a portion of the Manhattan bus terminal story, to which we turn in chapter 13.

13 More Than “A Humdrum Job of Engineering” Creating a Giant Bus Station in Manhattan

The Port Authority Bus Terminal will promptly be taken for granted, with little thought that this piece of progress did not happen quite automatically. It took years of struggle. —New York Herald Tribune, editorial, Nov. 3, 1950

T

he campaign for a large interstate bus terminal began as a fairly straightforward problem of urban and regional planning. By the early 1930s, with the Hudson River now spanned by bridge and tunnel, bus routes offering direct service from the suburbs of New Jersey were established, and several hundred travelers entered Manhattan by bus each day. They either crossed the Hudson via the George Washington Bridge, six miles north of midtown, or they came through the Holland Tunnel, far below the midtown area; then the buses proceeded slowly for several miles along congested streets to bus stops scattered between 34th Street and 51st Street. For those who lived near suburban railroad stations the rail option was faster, and for many others, the automobile was far preferable. Once the first tube of the Lincoln Tunnel was completed in 1937, and connecting highways in New Jersey were improved, bus travel to midtown Manhattan became more attractive. By 1939, the earlier trickle of interstate buses had grown to 1,500 buses each day, most of them emerging from the Lincoln tube at 39th Street and Tenth Avenue; then they spread across the midtown area to eight separate bus stations, with street stops enroute, blocking traffic and adding to the general congestion visited upon mid-Manhattan by automobiles and trucks. Soon after the Lincoln opened, traffic planners for the city and at the Port Authority began to realize that these problems could be dramatically eased if a single bus station were constructed near the Manhattan mouth of the Tunnel, and if all the interstate bus companies terminated their trips at the unified station, abandoning their scattered bus terminals. Working initially with 315

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Mayor LaGuardia and Robert Moses, the Port Authority studied the idea of building and operating a unified bus terminal, agreed to build it, and then found itself embroiled in a series of battles over five years with those who opposed its efforts—including the Greyhound Bus Company, Robert Moses, key legislators in Albany, and New York’s Governor Dewey. In 1950, the project was finally completed. The result was, in Lewis Mumford’s view, a building that is “a humdrum job of engineering concealed behind a mask of wholly perfunctory masonry.”1 But that aesthetic judgment should not conceal the bus terminal’s strengths—providing faster trips into Manhattan for commuters and others traveling by bus, reducing traffic congestion on midtown streets, and intermixing passenger waiting areas with a variety of stores and other concessions, which would generate revenue needed to help the huge terminal become self-supporting. The evolution of this complex urban structure from concept to reality allows us to examine important facets of the mixture of rational planning and adroit political maneuvering that became the Port Authority’s hallmark in the Tobin era. And it brings into focus once again the complex ethical/ political terrain government officials must often traverse when they seek support from state legislators and others whose lives are heavily immersed in patronage politics, diverting them from the efficient achievement of some larger public purpose.

From Many Terminals to One? We believe that the [traffic] problem can and will be measurably relieved by a midtown union bus terminal. —Robert Moses, 1944

The steps leading to the Port Authority bus terminal began in 1939, when Mayor LaGuardia responded to concerns about growing bus traffic and congestion by appointing a Committee on Interstate Buses. That committee recommended that those behemoths be banned from the midtown area, and that their street routes and stations be limited to locations west of Eighth Avenue. Since offices and shopping areas were located mainly between Third and Seventh Avenues, this restriction would make interstate buses less convenient for bus travelers. However, the time lost by the typical passenger would be quite modest, and the interstate bus companies would see benefits

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in time savings and labor costs if they could drop off all passengers near the Lincoln Tunnel exit.2 After further study, New York City’s governing body passed a resolution in 1940 temporarily banning construction of new bus stations in the midtown area, and private entrepreneur Harold McGraw said his firm might construct a large bus terminal for interstate passengers, west of Eighth Avenue. Gasoline rationing and curtailed wartime traffic blocked that effort for the next three years, and early in 1944 McGraw announced that even with postwar traffic recovery, he did not believe a union bus terminal would be economically feasible for private capital.

The Port Authority’s Plans Mayor LaGuardia then turned to the Port Authority, which had taken part in the 1939 study, and asked that it carry out a full analysis of the union terminal idea. Tobin and his colleagues agreed to do so, and New York State provided funds to underwrite the planning effort. The project won the warm endorsement of the City’s top transportation official, Robert Moses: “We believe that the [traffic] problem can and will be measurably relieved by a midtown union bus terminal to be carried out by public enterprise through the joint co-operation of the City of New York and the Port Authority.”3 By June 1944, the Port Authority had sketched out plans for a large bus station between Eighth and Ninth Avenues, with a connecting set of ramps and bridges over four streets, leading from the Lincoln Tunnel; the system would permit most interstate buses to go directly to the terminal, without crossing city streets (see map). It was estimated that shifting all the interstate buses from existing routes and scattered midtown stations would reduce traffic congestion equal to adding two or three additional crosstown thoroughfares.4 To persuade all the bus companies to move from their separate stations into the new terminal, the city would have to agree that no bus terminals could in the future be built or expanded in the midtown area. Without that prohibition, the Port agency argued, the interstate bus companies would be reluctant to sign contracts to use the Eighth Avenue terminal, since their competitors might later be able to build or enlarge terminals in more centrally located areas. Moreover, this restriction was essential to ensure that the Eighth Avenue terminal would have enough passengers to generate substantial rental and concession income—in time making the giant project selfsupporting. That goal was crucial to the Port agency’s thinking about this project, as it was in airport planning.5

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13-1. Before: the eight bus terminals in mid-Manhattan in the 1940s, and the streets (shown in gray) which were heavily used by buses from the Lincoln Tunnel. After: the route that all interstate buses would use to reach the terminal proposed by the Port Authority in 1944.

Greyhound Dissents Mayor LaGuardia agreed with the Port Authority’s approach, and the only significant obstacle was the Greyhound Corporation, the nation’s largest bus company. Greyhound insisted that it retain, and later have the option to expand, its bus terminal at 34th Street between Seventh and Eighth—a location convenient to much of midtown. Though concerned about the loss of income

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13-2. Proposed ramps and overpasses, Lincoln Tunnel to the bus terminal

if Greyhound were not included, Tobin said that his agency could still build the union terminal, as long as Greyhound agreed not to compete with the Port Authority’s project by attracting other bus companies to use the Greyhound station. But Greyhound resisted that restriction on its competitive opportunities, and Robert Moses, representing Mayor LaGuardia, endorsed the Port Authority’s position and criticized Greyhound’s “go it alone” stance.6 During the winter of 1944–45, Greyhound explored the question of leasing space in the Eighth Avenue terminal but decided not to do so. Meanwhile, the Port Authority met with more than two dozen other bus companies that carried interstate passengers into mid-Manhattan, and by late April, most had agreed to take space in the new bus station. Greyhound’s continued status as a “hold out” led Mayor LaGuardia to criticize its actions and to reaffirm his position—that only one terminal, west of Eighth Avenue, should be used by interstate buses.7 At this point, in the spring of 1945, a straightforward planning and construction project began to mutate into a complex array of political endeavors, whose three main phases are described below. The first and longest was the battle to win the city action needed to make the project financially feasible, against the sustained opposition of Greyhound—which soon persuaded Robert Moses to reverse his position and become Greyhound’s ally. The sec-

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ond was the effort to relocate those who lived and worked in the large block where the bus terminal would be built, so the existing buildings could be demolished. And the third, focused on construction of the terminal, involved a campaign led by influential legislators to coerce the Port Authority to award construction contracts to those with political influence, rather than using objective performance criteria. All three phases, in different ways, pressed against the “efficiency and economy” standards to which this child of the Progressive Era attempted to adhere.

Commissioner Moses Tries to Block the Terminal And to Greyhound’s aid came Bob. As a result, the City Planning Commission, a body that is very often the object of special Moses pressure, yesterday voted down the zoning proposal and upheld the cause of private enterprise and traffic congestion. —New York Post, editorial, May 2, 1946

Until the spring of 1945, Robert Moses had been counted as a friend of the Port Authority’s bus-terminal plans. In early May, however, he used his position as a member of the City Planning Commission to begin a complex set of maneuvers that in time threatened to destroy the project. His first step, in May 1945, was to propose to his fellow Planning Commissioners that the City’s zoning regulations be amended: the power to review bus-terminal expansion proposals, then held by the Board of Standards and Appeals, would be transferred to the planners’ office. In view of the wide impact of bus routes and terminals on the City’s development, this change appeared logical; and LaGuardia, who was firmly committed to the Port Authority’s approach, described it as “the initial step” in accomplishing that project. But here LaGuardia misjudged his Machiavellian adviser; to Moses, this was the first step in a very different direction.8 After a public hearing, the Planning Commission then adopted a zoning resolution which would give it control over designating “exceptionally congested traffic areas,” in which new or enlarged bus terminals would be prohibited; and the City’s governing board (the Board of Estimate) approved that new power in an October vote. A few weeks later, the Planning Commission held a hearing to gather information on which areas should be given the new designation, and the Port Authority urged that the midtown area east of Eighth Avenue be included. The Commission then sat down to work out its bus-exclusion plan.9

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Greyhound Benefits Meanwhile, Greyhound prepared a new proposal to expand its terminal and sent a copy to the Planning Commission for its review. Now Moses emerged in a new light. Writing to the Port Authority chairman in October 1945, Moses asserted that the Greyhound project would reduce traffic congestion and therefore the bi-state agency should not oppose it. Moreover, to block Greyhound would be “grossly unfair,” he argued, since it was “merely proposing to extend a non-conforming use” already authorized by the courts. In a public meeting two days later, Moses also suggested that it would be foolish for the Planning Commission to oppose Greyhound’s expansion by using the new zoning standard, since the bus company would take the case to court and quite possibly win.10 Moses now thought he might be able to bend Tobin to his will by using his considerable persuasive skills. So he invited the Port Authority’s staff director to his office, where Tobin also found two officials of the Greyhound Corporation on hand. “This is the way we’re going to do it,” Moses reportedly explained; and he outlined a plan which would give the Port Authority all the small interstate companies, while Greyhound expanded its terminal (presumably with the option to rent space to the other long-distance carriers). Moses also proposed that, in constructing its large terminal, the Port Authority make use of his own preferred engineering firm. Tobin rejected the division with Greyhound, since it would undermine the economic feasibility of the Eighth Avenue terminal, and he turned down the second proposal as well.11 Moses’ motivations in pursuing this campaign are not entirely clear. It is possible that he was genuinely aggrieved for Greyhound; that was the interpretation he suggested in 1978, when he handed me his October 1945 letter to Cullman (quoted above). It is likely that Moses was also motivated by displeasure with the prospect that the Port Authority would be expanding further into “Moses country.” The bi-state agency wanted to build the world’s largest bus terminal in mid-Manhattan; during the fall it began construction of a huge truck terminal in lower Manhattan; and in October 1945, the Bartholomew Report suggested that the Port Authority consider taking control of Newark Airport and of New York City’s air terminals as well. A close acquaintance of Moses stated this point more strongly, in a confidential interview a few years later: “He hates the Port Authority because it does, and does well, all the things he would like to do himself—builds bridges, tunnels, bus terminals. Hence, he always tries to block it and get those functions for himself.”12

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Some of those who were directly involved in the battle saw evidence that led them to believe there was a more personal motivation still—that those friendly to the Greyhound interest had provided some benefits to Moses, in return for his support for their cause. Nor did they think this was the only lapse from principle in Moses’ recent record; senior Port Authority officials believed that Moses obtained payments from engineering firms and banks, in return for giving them contracts and other benefits generated by his many construction jobs. Those with evidence of these allegations would describe them to Port Authority officials, but “nobody will say anything publicly” because Moses is “so powerful.” Perhaps this is an area in which Robert Caro is too generous to the great man.13

Lee Jaffe and the Newspapers Counterattack Whatever mix of motives engaged Moses, the Port Authority knew by the fall of 1945 that it faced a battle. Austin Tobin called in several of his top aides— chief planner Walter Hedden, chief engineer John Evans, and the agency’s director of public relations, Lee Jaffe—and explained that “Bob Moses is against us. I’m not sure we can beat him.” The main strategy agreed upon was to marshal evidence on midtown traffic conditions and present it in face-to-face meetings with reporters and their editorial boards. Hedden’s staff compiled information on traffic congestion on various streets, as well as police reports of accidents and delays; and Lee Jaffe’s staff took photographs that dramatized street congestion and other scenes (“long lines of people waiting on sidewalks and in the street, for the buses, often in rain and snow,” as one member of the team recalls). With these materials in hand, Jaffe now turned her attention to educating the newspapers—and through them the general public—on the benefits of the bus terminal. Detailed reports of congestion, photos of snow-encrusted commuters at bus stops, and other materials of interest were sent to “the editors, the drama critics, the columnists.” Jaffe and her aides met with members of the editorial boards and reporters at the New York Times, the Herald Tribune and other newspapers, and in these sessions they reviewed in detail the advantages of the proposed bus terminal, and they also discussed Moses’ change of heart and his close ties to Greyhound.14 The results of these efforts began to appear in the early weeks of 1946, while the City Planning Commission deliberated on the bus-exclusion issue. In January, the Herald Tribune, the New York Times, and the Sun endorsed the Port Authority’s plan, and the Bergen Evening Record soon followed suit.15

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However, on December 31, 1945, LaGuardia’s term as mayor had ended, and with it his ability to shape city policies on bus-traffic congestion. The delays at the Planning Commission had strengthened Moses’ hand; with LaGuardia gone, he might find it easier to persuade his fellow Commissioners to accept Greyhound’s plans. Moreover, LaGuardia’s successor, William O’Dwyer, had already shown his willingness to rely on Moses’ advice, endorsing his plan to create a separate City Airport Authority; so his ideas on traffic congestion and bus terminals might also win O’Dwyer’s support. Early in January, 1946, the City Planning Commission appeared to be moving toward a vote favorable to the Port Authority, with Moses as a lone dissenter; and the Herald Tribune expressed confidence that Mayor O’Dwyer would “soon speak up” in support of the midtown bus prohibition. The Port Authority’s allies in Albany and Trenton then introduced legislation to permit the bi-state agency to construct the Eighth Avenue terminal. But the Planning Commission did not act during February, and it did not act in March; and Mayor O’Dwyer remained in limbo, perhaps hoping—like Dickens’ Mr. Micawber—that “something would turn up” to save him from a difficult situation. The New York Times protested his silence, arguing that “the city’s business and citizens have a right to know how the Mayor stands on this issue,” and urging that O’Dwyer take “a strong position of leadership” in order to advance this “project of tremendous benefit.”16 Meanwhile, bills authorizing the Port Authority to build a bus terminal ran into vigorous opposition in both states. In Albany, the railroads—which viewed the bus station as a competitor with unfair tax advantages—sought to block it until the Port Authority was forced to pay full taxes on this terminal and its other properties. They were joined by one business group from New York City, and it appeared that Moses and Greyhound were active in encouraging these opponents. The Port Authority marshaled support among other business associations, and with the leadership of key Republican legislators and Governor Dewey, the New York bill was finally approved in both houses in late March.17 Railroad interests also protested in Trenton, and the opposition was led by a state senator whose main source of income was his job as a salaried railroad employee. With support from Governor Edge, and assistance from the Port agency’s own commissioners, the legislative leaders fought off the railroad lobbyists, and final approval was assured when the State Senate passed the bill by a one-vote margin in early April. By mid-April, both governors had signed the new law, and the Port Authority stood poised to act, as soon as the midtown prohibition was approved.18

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The Planners Succumb The City Planning Commission met three times in April, but Commissioner Moses successfully urged that it delay a vote while he tried to find a “compromise.” Mayor O’Dwyer still remained silent; his position on the issue was viewed as “something of a mystery.” The new mayor was already showing signs of the “Hamlet-like introspection and indecision” that would mark his six years in office.19 And then, on May 1, 1946, the City Planning Commission did act—voting 5–2 not to designate any areas in Manhattan from which bus terminals would be excluded. Following that vote, the Commission scheduled a public hearing on a new proposal, which would give it the power to approve expansions of bus terminals in “congested areas.” Moreover, O’Dwyer now reclaimed his voice, offering an elusive, partial endorsement for the Moses/ Greyhound position.20 At the Planning Commission hearing, held June 12, no witnesses endorsed its proposal to enlarge its own powers, and a dozen appeared in opposition. However, Moses now commanded a majority at the Commission, and it soon adopted the proposal. The Board of Estimate then blocked the plan, and the Commission responded by hiring two consultants with longstanding ties to Moses, asking them to provide a new assessment of traffic congestion in the City. Their report, completed in November, endorsed the Greyhound expansion plan, which might (they said) actually reduce congestion in the midtown area.21 Moses and his fellow Planning Commissioners promptly forwarded that report to the Board of Estimate, with their endorsement. Meanwhile, Greyhound reaffirmed its plans to spend $10 million to modernize and expand its 34th Street terminal.22

The Mayor Shifts His Allegiance Once the City Planning Commission had embraced the Moses position, the Port Authority’s friends in the newspaper world took direct aim at both. “Moses Wins, We Lose,” the New York Post proclaimed. The New York WorldTelegram, which Moses had contacted in the hope of generating some support for his cause, argued that “public confidence in the City Planning Commission has been dealt a bad blow”; the newspaper questioned in its headline whether these were “Planners for City or Bus Companies.” The Times and the Sun agreed, and the Herald Tribune called the decision “a major blunder.”23

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A few hours after the Commission’s May 1 vote, Port Authority chairman Cullman announced that his agency was suspending its studies of the bus problem and returning the state planning funds to Albany. “Evidently O’Dwyer does not seem to want a bus terminal,” he commented.24 Soon LaGuardia joined the attack, characterizing the May decision of Moses and his fellow commissioners as a “flip-flop” and a “betrayal of the public interest.” And in mid-June, the World-Telegram pressed the issue further, wondering whether the issue of “where Greyhound gets its special power and influence” should become a matter for a special investigation.25 The drumfire of newspaper attacks on the City Planning Commission and its concern for the Greyhound Company’s interests continued in the summer and into the fall. Meanwhile, the Port Authority’s commissioners and staff made contact with the Regional Plan Association and other civic and business groups which monitored development in Manhattan, and they too joined in criticizing the Moses approach and the passive attitude of the city administration.26 Mayor O’Dwyer found it uncomfortable to disagree with Commissioner Moses; but relying on Moses to resolve the bus-terminal issue had damaged O’Dwyer’s reputation. The mayor had remained silent as the conflict built during the spring; and then, just before the crucial May 1 vote, he had flown to California for a golfing vacation. In the weeks after that Moses victory, O’Dwyer had been castigated personally by newspaper editorial boards for remaining “aloof” when leadership was needed, for lacking the courage to “stand up against the opposition” of Greyhound and Moses, and for a “ridiculous” stance in calling for “more traffic surveys” instead of action. The behavior of the Planning Commission suggested to some that O’Dwyer was not in charge; Moses appeared to be the “Super Mayor of New York City.”27 Meanwhile, O’Dwyer’s faith in the vision and adroitness of his chief policy adviser was shaken during the summer by Moses’ failure in the airport battle, and during the fall O’Dwyer began to confer with the Port Authority on modernizing the City’s air terminals.28 As those discussions went forward, the bus-terminal issue came up as well, and by early December O’Dwyer told Tobin he was ready to endorse a resolution prohibiting bus-terminal expansion in midtown. Learning of the mayor’s “defection,” Moses’ aides then tried to convince a member of the Port Authority board to break ranks with his fellow commissioners and work out a new proposal which he and Moses could take to O’Dwyer. But that ploy was unsuccessful.29 By the close of 1946, the flow of interstate buses which struggled through midtown streets had grown to 2,500 a day, and the Moses approach had gained

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little support among the city’s other elected officials. O’Dwyer decided it was time to abandon this battle, and Moses’ decision to take a vacation abroad in late January offered the mayor an opportunity to act without Moses’ heavy hand on his shoulder. Interrupting the regular agenda of the Board of Estimate meeting on January 30, 1947, O’Dwyer introduced a resolution which would override the Planning Commission, and which would block future Greyhound expansion and any other bus-terminal construction east of Eighth Avenue. The resolution was adopted without dissent.30 O’Dwyer had conferred with Cullman and Tobin before the meeting, and they were ready with a statement as soon as the vote was announced. The Port Authority would “go forward immediately” with plans to construct a $17 million terminal at Eighth Avenue, Cullman said, and he felt sure that the terminal would be operating “inside of two years.” The infectious optimism of Julius Henry Cohen still survived.31 And so did O’Dwyer’s reputation, aided by the Port Authority’s readiness to give thanks to the Mayor for ending the period of drift. The New York Times thought that the Mayor deserved “much of the credit” for the Board’s action, and the Bergen Record praised the way he “quietly took command” and “planned his coup.” His leadership was extolled by the other newspapers as well.32 But Commissioner Moses was not pleased.

Greyhound’s Faithful Friend The defeat Moses experienced in January 1947 might have seemed final to most political leaders. But Moses suffered defeat much as he suffered fools, which was not gladly. After all, the Board of Estimate action was a mere resolution, not one of those famous bond contracts which were protected by the U.S. Constitution. So Moses and his allies pressed ahead again and again, seeking ways to undermine the city’s midtown prohibition. Even as the Port Authority relocated the tenants, and demolished the structures on the site, and floated bonds to finance the enterprise, even as it constructed and completed and began operating the Eighth Avenue Bus Terminal—for those four years and two more beyond—Moses and his favorite bus company fought with all the cunning he could muster, hoping to win approval for Greyhound to expand its 34th Street bus station, perhaps doubling its capacity. The Moses-Greyhound efforts from 1947 to 1953, and the countering tactics by Tobin and his colleagues, deserve brief review. They illustrate a range of strategies that skilled infighters can use to gain their goals, and the importance of sustained “political intelligence” in neutralizing the political strength of

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one’s opponents—a factor which can yield success even against the tactical skills of a Robert Moses. The place to begin, however, is with incentives. Once the city’s top governing body, the Board of Estimate, had endorsed the midtown prohibition on bus terminals, and the Port Authority had begun work on the project, why did Greyhound and Moses continue the fight? The Greyhound Company appears to have been motivated mainly by a brand of individualistic, competitive zeal. To stand alone, operating its own major terminal in the center of the nation’s largest city, would underscore its position as the nation’s premier bus company. In contrast, to accept a position in the Port Authority’s terminal would suggest that Greyhound was merely one of 30 bus carriers, a tenant in a government building. Moreover, the Port agency would design the bus terminal to maximize efficiency in passenger and bus movement, and it would try to maximize the revenues that it—not Greyhound—could obtain from passengers, stores, and other businesses in the terminal. Most important, if Greyhound accepted the move, it would lose the crucial advantage of proximity to Macy’s and the shopping areas near Herald Square.33 Greyhound’s reluctance to accept the Port Authority’s rational-planning model—which the agency thought was essential for this massive project—is reminiscent of the attitude of railroad executives toward the Port Authority’s union-terminal scheme and unified lighterage plans in the 1920s, as well as the efforts of Pan Am and other air carriers to maintain their preferred gate locations and other advantages at LaGuardia and at airports across the country. It was the capitalistic ethos at work.34 Greyhound’s resistance was enlivened and its chances for success made promising by its alliance with Moses, whose ability to work his wiles had been demonstrated time and again in New York’s recent history. But what persuaded Moses to carry on the fight? His primary motivations have been suggested already: Possibly he felt that Greyhound, having constructed the 34th Street station and then having purchased nearby lots for expansion, was justified in its request to build the larger terminal. Also, as he argued, it was conceivable that an expanded Greyhound terminal could reduce congestion in midtown. Then there were the special benefits which Greyhound may have provided to Moses and his favored engineering firm, benefits that would increase if that firm could take charge of constructing the larger building. Perhaps, however, the antagonism that Moses felt toward the Port Authority by 1948 overwhelmed all other reasons and drove him most fiercely. That conclusion has to be based on conjecture, but it is reasonable conjecture:

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When Moses first teamed up with Greyhound, in 1945, the Port Authority was no more than a potential invader in “Moses country”; it had begun to sketch out plans to build a Manhattan bus terminal, and a consultant to the City of Newark had suggested it might be the best agency to operate the region’s airports. But during the next two years, its incursions had become more salient. While fighting to win approval for the bus terminal, its agents had undercut Moses’ influence with Mayor O’Dwyer and with Moses’ own allies among newspaper editors. In Albany, where Moses’ ability to win was widely acknowledged, the intruder had teamed up with leading Republicans to undermine his effort to kill the bus-terminal legislation; and the combined Port Authority/newspaper campaign had made one of Moses’ influential arms, the Planning Commission, a laughing-stock among serious students of city planning. Moreover, in 1947 the Port Authority took control of LaGuardia, Idlewild, and Newark airports; and Moses’ own competing creature, the City Airport Authority, had first been ridiculed and then killed. Would it not be fitting retribution if Moses could find some way for Greyhound to build its great new terminal at 34th Street near Seventh Avenue? Would it not be an even greater pleasure if Greyhound won that right after the Port agency had invested millions in the Eighth Avenue structure—only to see that project plunge toward financial disaster as Greyhound and the companies it could attract to its modernized 34th Street station stayed away from the distant Port Authority terminal, and then, faced with law suits by other bus firms which wanted the same right to build that had been accorded Greyhound, the city fathers abandoned the midtown restriction altogether? This might be motivation enough to drive a man who hated to lose—to keep him working on the task while the Port Authority terminal was constructed and then opened, at the end of 1950, and then onward into the early 1950s, until Moses finally abandoned Greyhound in 1953 and silently admitted defeat. Turning from motivations—and conjecture—to actions, the evolution of this bus-terminal conflict can be briefly summarized. In 1947, once the Board of Estimate approved the bus-exclusion zone, the Port Authority purchased all the parcels in the block between 40th and 41st Streets, running west from Eighth to Ninth Avenues, sold $16 million in bonds to finance the project, and completed detailed construction plans. That fall, apparently bowing to the inevitable, Greyhound’s president announced that his company was abandoning its plans to build a larger bus station on 34th Street.35 During 1948 and 1949, the Port agency cleared the site, poured the foundation, and began to erect the steel skeleton for the huge building. In these two years, Greyhound raised its head only once, in 1948, sending Mayor

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O’Dwyer an informal proposal which outlined a plan for improved off-street parking for the buses near its 34th Street terminal. Asked to comment, Tobin pointed out that the proposal would in effect double the bus capacity of the terminal, and the trial balloon was quietly withdrawn. Early in 1950, Moses opened a new campaign, sending to the Board of Estimate a Greyhound proposal to close its smaller bus station at 50th Street and to consolidate operations at 34th Street; that terminal would therefore need to increase its bus berths from 8 to 19. To make the proposal more appealing, Greyhound said it would add 770 parking spaces for cars on the roof, thus helping to meet the City’s severe parking shortage; Moses thought the plan deserved careful study. Tobin dispatched his chief legal aide on New York City problems, Rosaleen Skehan, to talk with city officials; Lee Jaffe made contact with the editors of the Herald Tribune and other newspapers; and the agency’s top planner, Walter Hedden, met with officials of the Regional Plan Association and other civic groups. The Moses-Greyhound plan soon faced a barrage of public criticism, and O’Dwyer and his colleagues were urged to adhere to the “promise solemnly voted” in 1947; if they allowed Greyhound to proceed, “their pledged word of honor would be suspect from that day forward.”36 Caught between his 1947 commitment to the Port Authority and Moses’ insistence that the benefits of the new Greyhound plan deserved close study, Mayor O’Dwyer struggled. He asked the City Planning Commission to look at the proposal; he thought the Traffic Commission should consider it; he met with Port Authority officials and explained that he didn’t want to break his earlier pledge but he thought the parking problem was so severe that he needed to look at every option. And while he struggled, the Traffic Commission—of which the ubiquitous Moses was a member, by appointment of Mayor O’Dwyer—held a confidential session in early March and invited Greyhound to present its plan. By then the chorus of opposition in the media and business community was too great, however, and the Traffic Commission rejected the Greyhound plan in late March. The Planning Commission did the same in the middle of April, and the Board of Estimate followed suit in late April, 1950—with O’Dwyer commenting ruefully on the impressive support which the news media had given to the Port Authority’s position. Even Moses joined the opposition, because, he said, it seemed clear that the new Greyhound plan would increase traffic in the area around 34th Street. The 1947 pledge weighed not at all with him or the majority of the Traffic Commission, so a different Greyhound expansion plan, which might reduce traffic in the area, was still a possibility.37

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Meanwhile, with public attention focused on the Greyhound plan, Moses searched for another way to defeat the Port Authority. In the early weeks of 1950 he drafted a bill to create a New York City Parking Authority, which would take control of parking-meter revenues and parking fines and use the funds to build “badly needed” parking garages. As introduced by his allies in the state legislature, the bill gave the new agency the power to build garages and “any kind of terminal,” and its projects would be exempt from existing zoning laws and from review by the Board of Estimate. Monitoring draft legislation in Albany, Tobin’s aides located the bill and realized that it could be used to achieve the Moses-Greyhound goal: Greyhound could sell its 34th Street property to the new agency at cost, and the Authority could then lease it to Greyhound, which would agree to build a parking garage for automobiles—with room for a large flow of buses as well! Created as an independent state agency, the Parking Authority could argue that it was not bound by any pledges given by the Board of Estimate.38 When he learned about the bill, Tobin called O’Dwyer’s deputy mayor, who agreed that the Parking Authority’s activities ought to be reviewable by the Board of Estimate; but the deputy later called to say that it was too late; an attempt to add an amendment now “might endanger the passage of the Parking Authority bill.” Alerted to the problem by the Port Authority, the New York Times agreed that the legislation was “very broad in its terms.” But “surely,” the Times opined, “men of good will can sit down for an hour or two . . . [and] take the bugs out of the bill.”39 Such men seemed in short supply in city government just then, so Tobin and his commissioners appealed to Governor Dewey and their own legislative allies in Albany. Before passage, the Parking Authority bill was modified, requiring that its projects conform to the January 1947 bus-restriction resolution. Thus ended Moses’ 1950 efforts on behalf of Greyhound.40 The state legislature reconvened in January 1951, and Moses then tried to insert phrasing in the Parking Authority law that would lift the bus restriction. When they learned about the stratagem, Tobin and Jaffe alerted their friends at the World-Telegram and Sun and the Herald Tribune, which publicly attacked the Moses maneuver; then Tobin and Commissioner Bayard Pope, who was influential in state Republican politics, met with the mayor, who soon disavowed the proposal and ensured that it was dropped in Albany.41 Moses attempted to insert the same kind of amendment to the Parking Authority law in 1953, but that ploy was blocked by the Port Authority’s friends in the state legislature. By now Moses and Tobin were beginning to confer on more promising ground, holding the early discussions that would

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lead to a large, cooperative highway program in 1954–55. It was time for Moses to leave the field of battle, and in 1953 he abandoned Greyhound to its own terminal efforts. Cast adrift, Greyhound tried for several years to persuade the city’s elected leaders to permit it to expand its 34th street station or build a new terminal nearby. On each occasion, newspaper editorials and major business associations in Manhattan would sound the alarm, and the bus-exclusion resolution was reaffirmed. Finally, in May 1962, Greyhound agreed to abandon both its 34th and its 50th Street bus stations, and to began life at new quarters, in the Port Authority Bus Terminal. By the summer of 1963 Greyhound’s buses were no longer struggling down city streets; they had joined the crowd, moving swiftly up the special ramps from the Lincoln Tunnel to 15 new berths in the Port Authority building.42 A decade later, when Robert Caro described Robert Moses’ long career, and analyzed in rich detail his battles, victories, and defeats, he paused at the year 1953 and reflected on the encounters thus far between the Port Authority and Moses. Caro wrote: “Since O’Dwyer had handed it Idlewild in 1946, every ensuing confrontation between the two giant ‘public benefit corporations’ had resulted in a Moses victory.”43 The defeat for Moses in the bus-terminal confrontation is not counted in this assessment; indeed, that long battle does not appear to be mentioned in Caro’s book at all. Yet this struggle was a crucial chapter in the relationships between these two regional governments in the 1940s and early 1950s. The other important conflict during those years, providing some measure of the ability of each side to get its way, is the contest over control of the region’s airports, described in chapter 11, where Moses lost again. There was not much else for Caro to tally.44

What To Do with the Families Argument, bonus offers and pleas have made no impression upon the residents of the rickety tenement houses in the district. They say they have no place else to go and they have refused to move. —Newark News, April 30, 1948

Once the Board of Estimate had approved the bus-exclusion resolution, in January 1947, the Port Authority’s real-estate and legal staffs began the task of acquiring the property in the large block where the bus terminal would rise, as well as the land needed for the ramps and roadways from the Lincoln Tun-

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nel, several long blocks to the west. Portions of the land and buildings were occupied by a utility substation and by 140 other industrial and commercial shops and plants (a meat store, for example, laundries, and a tailor shop). To gain control of these properties at reasonable cost, the acquisition team used a variety of negotiating and condemnation strategies, recalling the TobinPallmé efforts of the early 1930s. By the fall of 1947, most of the area was in the hands of the bi-state agency, and the shop-owners and other enterprises had moved to other quarters.45 Far more challenging was the problem of relocating the 640 families who lived in buildings to be demolished and replaced by the terminals and approach ramps. During the spring, the Port Authority offered $150 to those who agreed to move, plus the equivalent of two months rent. Tobin and his aides had expected these tenants would soon find alternative apartments, which would permit demolition of the old structures late in 1947 and completion of the bus terminal by the early weeks of 1949. However, months went by with few departures, and at the start of November, only six of the 640 families had found new apartments. The others, pleading lack of alternative housing at rents they could afford, were still living on the site and resisting the pleas to move.46

The Moses Strategy During the late 1940s, Robert Moses and other highway-builders developed an effective array of tactics to put an end to this kind of resistance, and they applied the strategy both in road-building and in urban renewal programs. The basic approach was to send eviction notices to tenants, giving them a few weeks to move, together with a modest sum to assist with relocation costs— and a warning that they would be forced out if they did not leave voluntarily, and soon.47 Because of his impatience to “get things done,” his wide-ranging influence with New York City’s elected officials and at Albany, and the control over construction funds available through his Triborough Bridge and Tunnel Authority, Moses became the exemplar of “slum clearance efficiency.” In these years, most of his efforts were aided and abetted by the press, and passively accepted by the region’s business organizations. For when Moses sought to clear poor people from “slum housing,” he faced no organization with the financial and intellectual resources of the Port Authority, and no adversary with the press contacts and the public-relations skills of Lee Jaffe.48 During the years 1945–52, thousands of New York City residents, mainly poor, were evicted from their homes, so that new highways, housing, and of-

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fice buildings could be constructed. Sometimes the eviction notices were sent through the mail, but not always. In the Manhattantown project, on the Upper West Side, families learned about Moses’ plans via notices tacked to their doorways which carried this message: demolition of this building will be started at once. tenants must vacate. for information, call relocation office, cor. of west 100th street.

But that office had no information regarding vacancies in existing apartments or other help in finding where else one might live. In East Tremont, in The Bronx, the 1,500 families in the path of the proposed Cross-Bronx Expressway received eviction notices which gave them ninety days to vacate, and no assistance in finding new living quarters.49 When tenants resisted leaving by the announced date, Moses applied the next stage of his strategy. As individual housing units were vacated, demolition teams were sent into the apartments, and windows and walls were smashed. If this did not persuade those living above and next door to depart, boards were hammered across doorways and windows, forcing the tenants onto the street. Where they went was “of no concern” to Moses and his aides.50

Tobin Tries a Different Way Tobin and his aides were impatient to begin construction of the bus terminal, but when monetary incentives failed to budge most of the tenants, they searched for an alternative to the traditional route of eviction notices followed by court-enforced ouster. During the fall and winter of 1947–48, Tobin’s staff made contact with realty firms which had experience in the low-income rental market and negotiated contracts with 92 agents, providing them with $100 for every tenant they successfully relocated to a new apartment. The Port Authority also agreed to redecorate the new apartments at its own expense.51 These steps had some effect, but at the end of March 1948, more than 550 tenants and their families still remained. “Many of them were very old,” Lee Jaffe recalled; “many never went out onto the street.” There were rats; the walls were dirty; but this was “all they had and they were afraid to leave it.” Also, there were ‘’38 houses of prostitution,” one staff member commented, and persuading the prostitutes to move any distance from their familiar source of clients was not easy. Moreover, there was an acute housing shortage in New York City in the late 1940s, and the real-estate agents were able to locate few apartments within the rental range that most of the tenants could afford. In

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early May, the Port Authority announced that the “difficulty in relocating tenants” had now caused a year’s delay in completing the terminal.52 Meanwhile, Tobin had asked Harvey Quigel, who directed the agency’s real estate department, to explore other strategies the agency could use. Quigel suggested that the Port Authority purchase a number of vacant apartment buildings, rehabilitate them, and offer them to the tenants. Tobin and the commissioners agreed with this plan, and by the end of May, both state legislatures had authorized the bi-state agency to make a temporary foray into the real-estate business.53 Quigel and his staff then identified 200 abandoned buildings and tried to figure out which would be satisfactory to the tenants, based on access to “schools, churches, public transportation, proximity of food stores” and other factors. However, the Engineering Department was anxious to clear the terminal area, and, under pressure, Quigel made what one of his aides later called “a terrible mistake,” including in the program some buildings that were “miles away” from the terminal site. “People didn’t want to move out of their neighborhood,” and their reluctance slowed the entire effort.54 During the summer and fall of 1948, eleven of the buildings were purchased and rehabilitated, central heating was installed, and apartments were provided with new stoves, refrigerators, and bathroom fixtures. Quigel’s assistant, Douglas Tuomey, then developed a close relationship with the tenants and worked with them to identify neighborhoods and apartments that met their needs. Slowly the remaining tenants began to move. By late November about 180 had either found their own places or moved to the Port Authority apartments. But 370 families remained, half of them on the bus-terminal block, and half in the path of the approaches from the Lincoln Tunnel. So the engineers worked around the tenants, demolishing buildings on one section while Quigel and his aides moved families to other apartments in the large block and in the ramp area.55 Meanwhile, the Port Authority began to face pressure from the bus companies which had agreed to move to the new terminal. With leases at their current sites expiring, some of the bus firms were concerned that their service would be disrupted. So, with Tobin’s agreement, the engineers began excavation on part of the site late in January 1949. The Port agency then bought three more buildings and pressed ahead with refurbishing apartments. At the end of May, the last tenant on the terminal block moved out, and during the fall, excavation was completed and the basement concrete was poured. As construction on the terminal proceeded, tenants who remained in the way of the approach ramps were then moved into the new apartment complexes.

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By the time the last tenants had left, at the end of 1949, the Port Authority had moved more than 270 families into renovated apartments in fourteen of its own buildings, and it had paid real-estate agents for locating housing for 65 families. Another 200 had found their own apartments, accepting the Port Authority’s cash-payment offer. Some of those who were forced to move were clearly unhappy, but the program offered a sharp contrast to the traditional relocation strategy. The judge with the power to order evictions on the site commended the agency for its innovative approach, and the Port Authority built on this experience when it carried out later relocation programs. By the mid-1950s, the Port agency’s relocation efforts set a standard which experts in the housing field urged New York City and state agencies to follow.56 But the relocation effort had delayed the bus terminal, which was initially scheduled for completion in early 1949, for more than a year and a half. As the Port Authority obtained bids for construction of the massive aboveground portion of the terminal in the fall of 1949, only an optimist could expect it to be completed by the end of 1950. And then disaster, in the form of vetoes from both state governors, struck.

Patronage Demands and the Progressive Legacy The Port Authority and its engineering advisers have given a very serious setback to the orderly processes of doing public work by contract. . . . Once the door is opened to awarding a public contract to other than the low bidder . . . , it is easy for favoritism or political considerations to enter. The Port Authority has opened that door. —Engineering News-Record, Jan. 19, 1950

On December 15, 1949, the Port Authority’s commissioners rejected the lowest bid for the main bus-terminal contract, voting to award the job instead to the second lowest bidder, Turner Construction Company. A few days later both Governor Dewey and Governor Driscoll vetoed the award; that negative action was almost unique in the agency’s first three decades, when hundreds of Port Authority programs and contracts had passed across the governors’ desks and only one or two had been formally disapproved. Both governors challenged the decision to bypass the lowest bidder, and so they appeared as champions of objectivity and economy in contracting, and as opponents of favoritism. The Port Authority, in contrast, was por-

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trayed as acting so as to encourage favoritism, a charge spread across the engineering profession nationally by a leading engineering journal (in its editorial, quoted above). But the reality was almost the exact opposite of these conclusions. The paragraphs below first examine the Port Authority’s rhetorical stance as “nonpolitical” and then show that even in the Tobin years a salting of patronage and other political favors accompanied the dominant effort—which was to uphold merit in awarding contracts and in appointing and promoting staff members. Turning next to the bus-terminal contract, we will follow, step by step, the political pressures brought against the Port Authority by influential state legislators, and the Port agency’s attempt to uphold Progressive principles while permitting a modest bow to patronage politics in its various contracts. When this attempt at compromise failed, the agency appealed again to the two governors and won; but this denouement gave the Port Authority a victory at some cost to its reputation for professionalism.

The Reality of “Nonpolitical Efficiency” State and local government in the New York region had endured a long tradition of political favoritism—in appointments to governmental posts, in the awarding of construction contracts and legal business, and in a variety of other ways. As we saw in earlier chapters, the Port Authority was structured so the pressure to use narrow political criteria in awarding contracts and making other decisions might be lessened. Instead, expertise and the proven capacity to “get the job done efficiently” would be controlling, as the bi-state agency hired and promoted staff members, awarded contracts for construction and for insurance on its large facilities, and carried out its expanding range of duties. At least these were the hopes of Julius Henry Cohen and his collaborators, drawing upon principles of the Progressive Era, and by and large, their hopes were realized.57 Even so, during its first two decades the Port Authority did encounter patronage’s embrace. The long-time personnel director, Joseph Carty, saw appointments as a key route to maintaining public support for the Port Authority; and at lower staff levels political contacts were an important route to jobs. As a close student of the agency concluded, “Tobin inherited a system of political appointments,” which included “a large number of police and maintenance men, as well as office workers.”58 Among Tobin’s chief goals, when he assumed control in 1942, was to strengthen the merit system for staff appointments and to ensure that contracts

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were awarded to the best qualified, not the best connected. By 1946, the Port Authority’s general policies included the stipulation that “merit . . . shall govern advancement and promotion,” and the warning that “preferential consideration will not be accorded any employee on account of political or other influence.” The next year Tobin decided to replace Carty, whose primary strength was his friendly relationships with New Jersey politicians; he then carried out a nationwide search for an executive whose professional career had been in the private sector. The new personnel director, John D. Foster, had worked for the Nestlé Corporation and other private firms, and he at once moved to strengthen the agency’s programs for training and evaluating employees. Foster later recalled that Tobin “insisted on a nonpolitical organization,” and that he supported Foster’s efforts with enthusiasm.59 In Tobin’s campaign to squeeze out patronage and other narrow criteria, public rhetoric had a crucial role. In speeches, interviews, and testimony at legislative hearings, Tobin proclaimed the importance of keeping the Port Authority free from political favoritism; in this way he reminded his own staff that they had been chosen based on merit, not because of their political connections; moreover, he stiffened the resolve of his managers, who were sometimes under pressure to find a job for a legislator’s relative or to give a contract to a worthy campaign contributor. Perhaps most important, through his emphatic public statements Tobin signalled to politicians, and to others who might like to capture portions of the Port Authority’s largesse for their own pockets, that such efforts would meet with no success, and therefore should not be attempted. Two examples from Tobin’s speeches illustrate his rhetorical strategy: I do not believe that an Authority can possibly be successful if political interference plays any part in its management or internal affairs. (1945) No private corporation could survive if its personnel were to be selected or its business conducted on the basis of political preference. That is an accepted . . . proper standard for the regular departmental units of our democratic government. But it is the death-knell of sound authority management. (1953)

And in 1956, when he was interviewed for a cover story in Business Week, Tobin stressed the “nonpolitical” theme as crucial to the agency’s success. “You can’t be ‘just a little bit political’ or ‘do a little favor,’” Tobin explained. “Once you slip, it’s the end. You’ve got to be completely nonpolitical, or become a complete creature of the politicians.”60

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Annmarie Walsh’s scholarly study of public authorities underscored Tobin’s approach. In order to “fend off patronage pressures from the outside,” she argued, Tobin “made good use” of the convention that authorities are nonpolitical. For example, “employees circulated a story about a person of note who approached Tobin” to seek promotion for a specific staff member. “Don’t tell me his name or I’ll fire him,” Tobin is alleged to have responded, emphasizing the view that outside political influence would not help employees to advance in the agency.61 But matters are not always what they seem, and during the late 1940s and beyond, Tobin did sometimes adopt a more cooperative tone with influential outsiders than his own rhetoric or Walsh’s assessment would suggest. For example, in the fall of 1948, the son of a newspaper editor in the region applied for a job at the Port Authority, with the support of one of the agency’s commissioners. Tobin wrote to the editor, explaining that there were no openings at present, but that the personnel department was “placing his name at the head of a list” for consideration when an opening in his line of work existed. Early in 1950, an aide to Mayor O’Dwyer asked Tobin to consider a friend for a laborer’s job at the New York Truck Terminal, and Tobin, in response, wrote that his personnel director would call in the friend for an interview, and that Tobin personally would then inform the mayor’s aide whether a job would be forthcoming. Later that year, a state senator in New York wrote to Tobin, supporting a specific applicant to operate a stationery store in the bus terminal, and Tobin wrote back to say that “Mr. xxx will soon receive a call from our Department of Concessions.” And when Commissioner Borg urged Tobin to hire one of Borg’s friends, Tobin pointed out that the individual could not be hired unless the Board waived the agency’s rule that new staff members should be under 50 years of age; “I assume they would do so,” he wrote to Borg, “on your recommendation.”62 In addition to these random events, the Port Authority had a long tradition of allocating some of its insurance commissions to brokers who did no actual work, an approach called insurance “patronage.” The practice, which had begun long before Tobin headed the “nonpolitical” agency, was viewed as a way to maintain political support at the state capitals and in the region; the brokers were politically connected, and indeed some were directly linked to influential state legislators. In the late 1940s the top staff finally confronted the issue, and in 1950 the commissioners discussed the problem at a confidential session. The “past practice was indefensible,” some members of the board argued, and the Comptroller then led an effort to eliminate commis-

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sions which were given to brokers who “had little or nothing to do with the work of actually placing and servicing the insurance.”63 Despite these examples of favoritism, the predominant policy at the Port Authority emphasized decisions based on merit and on effective performance, coupled with resistance to special political favors. Thus when one commissioner inquired whether a bank official, who had been helpful in persuading O’Dwyer to yield up the airports, might be rewarded by having a Port Authority deposit placed at his bank, Tobin’s notation on the letter was “file and forget.” When the mayor of a New Jersey town asked for a free pass for the Lincoln Tunnel, a request endorsed by a Port Authority commissioner (his “lifelong friend”), Tobin turned down the appeal. And when an influential New Jersey state senator challenged the agency’s decision to award a contract for Holland Tunnel iron plates to a company outside the region (rather than a local competitor), he was treated to an extensive analysis of the quality of past work and financial soundness of the firm selected, together with a list of six cities which had found its work of high quality. In conclusion, Tobin wrote, he was sure the senator “will agree with me that based on these facts our action . . . was the proper course for us to follow.” On rare occasions, Tobin himself suggested to staff members that they bow to political pressures; but by the late 1940s the staff had become committed to the patronage-free environment that Tobin enunciated publicly, and they resisted his suggestions.64 During the years 1948–1950, Congressman Emanuel Celler (D-Brooklyn) made several attempts to secure favored treatment from the Port agency, but without success. In the spring of 1948, Celler wrote to Chairman Howard Cullman, and then met with him and Tobin, to urge that the agency’s decision to award the clock concessions at the three airports to the Bulova Watch Company be overturned, with the concessions going to Celler’s own client, the Benrus Watch Company. A few months later, Celler pressed Cullman and Tobin to award a theater concession at the bus terminal or at one of the airports to one of his clients. And in 1950, Celler attempted to persuade Cullman to recommend another of his private clients for a parking concession at the Bus Terminal; he allegedly coupled this with a threat, if Cullman were not cooperative, to “investigate the Port Authority.” In all three cases, Celler and his clients were rejected.65 So the reality was not quite as pristine as Tobin’s rhetoric or Walsh’s interpretive summary would suggest. But it was, on balance, far more “nonpolitical” than the patterns of appointments and contract awards at many large governmental bodies in the New York region and beyond.

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A Challenge to Engineering Integrity In December 1949, the Port Authority’s emphasis on objective criteria in awarding construction contracts came into sharp conflict with the interests of one of Albany’s most influential politicians, Mallory Stephens. A member of the New York State Assembly from Putnam County, Stephens chaired the Ways & Means Committee. Most legislation affecting the Port Authority was handled by that committee, and Stephens had been instrumental in gaining legislative approval for Port Authority projects. In 1945, for example, the Port agency’s truck-terminal legislation was introduced by Stephens, and with his guidance it moved quickly to approval. In 1946, Stephens introduced bills which would authorize the bus-terminal project, and he then worked with the Port agency’s legal staff to strengthen the bill in order to overcome Greyhound’s effort to block it. And when the Greyhound team introduced a bill to subject the Port Authority terminal to full real-estate taxes, Stephens’ committee took control of the measure and killed it. The next year, he introduced the draft legislation needed to permit the Port agency to take over the region’s three major airports.66 These important efforts were not entirely uncompensated. Evidence brought to light a decade later showed that Stephens was also an insurance broker, and that he received modest commissions throughout the 1940s from the Port Authority, though all the work was often done by another firm. It was, as Tobin acknowledged during Congressional testimony, an example of insurance patronage.67 The Bus Terminal contract to be awarded in December 1949, was potentially much more lucrative. By mid-November excavation of the site had been completed and the steel framework was being erected; the December contract would cover all the other construction required before the terminal was ready for use—concrete work, brick and masonry, plumbing, electricity, the setting of the escalators, and the finishing needed to prepare the waiting areas and shops for occupancy. Because most bus companies had leases at their existing terminals which would expire at the end of 1950, the Port Authority decided it was essential to complete all the work (except for the shops) by November 1, 1950, with the stores ready by the end of December. The agency’s chief engineer estimated that the bids for this complex array of work should come in under $9.7 million.68 On December 8, bids on the General Building Contract were opened. The low bid, $8.94 million, was submitted by Merritt-Chapman & Scott; next came a bid of $9.19 from the Turner Construction Company; and there

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were eight others, ranging to a high of $10.7 million. Merritt-Chapman & Scott (MCS) had a strong reputation for its construction work on dams and paper mills, but it had little experience in erecting and finishing other kinds of large buildings. Turner, however, was experienced and highly regarded in constructing large office buildings; it had built the Port Authority’s inland terminal station in the early 1930s, for example, and it had carried out a major project at the United Nations complex. In addition to its position as low bidder, MCS had one other distinctive quality: it had recently added Mallory Stephens to its board of directors. The Port Authority’s general policy for contract work was to select the lowest bidder, if the agency was confident that this firm would meet high quality standards and complete the building by the specified date. In order to evaluate the low bidder against its near competitors—in terms of these performance criteria, together with cost—the Port Authority now followed its standard procedures. The first step was to ask each of the three lowest bidders to meet with the Port Authority’s chief engineer and his staff in four days, with a detailed schedule for the project, a list of proposed subcontractors, and information on the firm’s other current projects. On December 12, Chief Engineer John Kyle and several members of his staff held meetings with representatives from MCS, Turner, and the third lowest bidder. The discussion with Turner reinforced the chief engineer’s impression that it had very good experience in the field and ought to be able to meet the performance goals for the Bus Terminal. Turner planned to use its own forces for several key elements of the work; this would give the firm greater ability to control timing of the complex project. Moreover, the list of subcontractors was viewed as of high quality, and subsequent checks indicated that Turner’s current work on other projects was on or ahead of schedule. However, the December 12 meeting with MCS raised alarm bells. Senior MCS officials seemed uncertain that they could meet the November 1 completion goal; two of the three projects that MCS listed as indicating its ability to complete large, complex building structures were several months behind schedule; and MCS was planning to rely entirely on subcontractors for the actual work, with its staff effort limited to supervision. Moreover, some of the contractors were viewed by Chief Engineer Kyle and his staff as having done “inferior work” in the past and as being incapable of “finishing this complicated job within the time specified.”69 Kyle then followed his usual practice, sending his men into the field in order to examine the projects which MCS and Turner had underway. Two of the MCS projects were veterans hospitals, being constructed under contract

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with the U.S. Army Corps of Engineers; and when Kyle’s assistant called, he found that the Corps had “ ‘orders from the White House’ that no information was to be given to the Port Authority.” Off the record, however, he managed to learn that the Corps had awarded the larger hospital project to MCS only reluctantly, because it had little previous experience in such building, but that “tremendous pressures were brought to bear upon the Corps. . . . These pressures involved the White House, Senators, and Congressmen.” Kyle’s aide also learned that the Corps was very unhappy with the project; it was nine months behind schedule, MCS had organized the effort in a way that was “entirely inadequate,” some of the subcontractors were “below accepted standards,” and their work was “just sufficient to get by inspection.”70 The third job which MCS had listed was a state mental hospital at Poughkeepsie; and the state engineers had also been ordered not to discuss the project. But Kyle was able to break through the wall of silence, and he learned that construction was “substantially behind schedule,” and that MCS had organized the operation badly and was using “poor sub-contractors.”71 Under standard Port Authority procedure, information gathered in these inquiries next went to its Engineering Board, which included five independent engineers plus the bi-state agency’s former chief engineer (then in semi-retirement). Because of the pressure to get construction started so the November deadline could be met, the board convened on the 13th, only one day after Kyle’s conferences with the low bidders. Several of the board members had direct experience in working with MCS and Turner; based on that background and the information gathered by Kyle, the Engineering Board voted unanimously to recommend that the Authority’s commissioners award the contract to the Turner Construction Company, even though its bid was a quarter of a million dollars above that of Merritt-Chapman & Scott.72 When the Engineering Board reported its recommendation to Tobin, he realized that he faced a difficult political situation, especially in view of Mallory Stephens’ position at MCS. He telephoned Chairman Cullman and Commissioner Bayard Pope and explained the reasons for the decision in favor of Turner. Then he called the president of MCS, C. H. Cotter, met with him that afternoon to explain why the Engineering Board had voted for Turner over MCS, and offered to permit MCS to provide “any additional facts or information” which might lead the Board to reverse its position.73 Meanwhile, Mallory Stephens had called Tobin and arranged to meet with him on Wednesday morning, December 14. At that session, Stephens said that he had an important role in reorganizing MCS, that the firm was anxious to land the bus-terminal job as a way to “move into the New York

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City building field,” and that he was sure they could complete the terminal on time. He said he would work with Cotter in putting together the information needed to persuade the Engineering Board to endorse MCS. Later that day, Stephens met with Kyle and described his own “wide experience” in the construction field, “how much he was personally interested in seeing” that MCS broke into the New York market, and “his personal connections in various high places in local, State and Federal agencies.”74 That afternoon, Tobin received a telephone call from Walter Jones, Assemblyman from Bergen County, and sponsor of most Port Authority legislation in the New Jersey legislature during the late 1940s. Jones, who had a private law practice, said he had just been hired by MCS and that he would be at Tobin’s office on Thursday, with MSC president Cotter and several of his staff members, to meet with the Engineering Board.75 At the Thursday meeting, Cotter and Jones defended the construction plan set forth in the MCS proposal. Cotter argued that he had recently reorganized the company, so it was now a “hard-hitting, well integrated . . . organization” which could certainly complete the bus terminal, a “relatively simple job,” by November 1. The Engineering Board was not persuaded, however, and after Cotter and Jones departed, the Board unanimously reaffirmed its support of Turner. Tobin then phoned Stephens to give him the bad news. In previous discussions, Stephens had seemed to understand that MCS faced a difficult hurdle if the Engineering Board concluded that Turner was the better choice. Now, in Tobin’s perception, Stephens’ tone altered sharply. The decision of the Board was a “damned outrage,” he exclaimed. The situation “is a catastrophe,” he argued, “and it’s a catastrophe for the Port Authority too.” He said that he was going to appear personally at the meeting of the Port Authority’s commissioners and argue that MCS deserved the job; but after discussion, he agreed that Cotter, who knew the MCS staff and capabilities best, should make the case.76 Late on Thursday, December 15, the Port Authority commissioners assembled to make the final decision on the General Building Contract for the bus station. Cotter was given time to plead for their endorsement, and after he left, the commissioners called in the Engineering Board. Asked to give their individual views, the assembled engineers expressed strong support for the Turner Construction Company; and several, who had experience with MCS and its subcontractors, expressed dismay at the record of that firm.77 Now the discussion took a surprising turn. One New York commissioner, a lawyer with close ties to Governor Dewey, suddenly produced a list of construction jobs which, he said, had been carried out by Merritt-Chapman & Scott and “to the best of his knowledge . . . had been performed satisfacto-

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rily.” In fact, the commissioner reported, he had just talked with an official of one firm which had used MCS for a job in Florida, and this gentleman had been so enthusiastic that for similar work in the future he “would not consider any contractor but Merritt-Chapman & Scott.” The commissioner asked why the Port Authority had not examined those other projects. Because, Tobin responded, MCS had not listed them. Members of the Engineering Board then argued that the new list included mainly paper mills and other projects that did not require close coordination of many building trades. The bus-terminal project was, in their view, much more difficult.78 Two Port Authority commissioners then sought another way to avoid the political fall-out from rejecting MCS. Was the November 1 deadline essential, they asked. If MCS fell behind, would that really make much difference? An extended discussion followed, as planner Walter Hedden described the pressure then being exerted on some bus companies to extend their current leases for several years, and the need for some weeks of trial operation and staff training before the terminal began to receive passengers at the beginning of 1951. Once the terminal opened, he pointed out, breakdowns in the ventilation system, the fire protection plan, or the bus communication system could be disastrous.79 At this point, Tobin acknowledged that the staff recommendation to reject MCS was “a most unpleasant one,” which would “lead to most unpleasant consequences for the Port Authority” during the coming months. But he wondered if embracing MCS, with the likelihood of delays and commuter unhappiness to follow, would not lead to an outcome that could be even worse. Finally, reluctantly but unanimously, the Port Authority commissioners voted to award the contract to Turner.80 Early the next day (Friday, December 16), Tobin and two of his commissioners met with Cotter and Walter Jones and asked if their firm might want to withdraw before the award was announced, so that MCS would not be stamped publicly as the low bidder, judged unacceptable on quality grounds. Cotter declined that offer, but Jones then proposed that Turner include MCS as a sort of joint partner, sharing the work and the responsibility. The Port Authority team agreed to take that offer to Turner, and Tobin said that he would be “very happy if such a solution could be worked out.” They then left to meet with Turner’s officials, deciding enroute that they would make “an earnest and all-out plea” for a joint venture, as a solution to the Port agency’s political problem. However, they also conferred with Chief Engineer Kyle, and at his urging they agreed that there had to be “one central responsibility” for the contract, and that responsibility had to “be centered in Turner.”81 Cullman and Tobin then met with H. C. Turner, Jr., the company’s pres-

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ident. By Tobin’s account, they described the joint venture scheme, urged that he accept it, and argued that his acquiescence would be “a great service,” demonstrating “the cooperativeness and bigness of his company in remarkable fashion.” Tobin explained that to reject MCS from participation in the project would expose the Port agency to “the possibility of grave difficulties on many scores,” and so Turner, if he could agree to a joint venture, would provide a “happy solution” both for MCS and for the Port Authority.82 Turner responded favorably, indicating that he was “willing to do everything in his power to work out a joint venture,” and Tobin telephoned Cotter, who had been waiting for the call. Turner and Cotter met for two hours, with Turner offering MCS “a percentage of the contract,” but with Turner retaining overall supervisory control of the entire project. Cotter now dug in his heels, raising the banner of engineering integrity—in place of the aura of patronage politics which seemed to have enshrouded Merritt-Chapman & Scott as it had sought contracts to construct government hospitals, added Mallory Stephens to its board, and hired Walter Jones to plead its case. Cotter insisted that his firm must have supervisory control of “all the work that was apportioned to them”; anything less would be “demeaning to [his] company.” So the tactic had failed. Turner called Tobin to report on his meeting with Cotter, and Tobin, after thanking him for his efforts, then said that the Port Authority was relying entirely on Turner to complete the bus terminal and that “he should start to organize it at once on that basis.” But Mallory Stephens and his MCS team had not yet given up hope. On Saturday, when Tobin called him to report what had happened, Stephens was “bitter and vehement.” He criticized the Engineering Board as a “bunch of old fogies” who didn’t realize the important strides that MCS was making in industrial building, and he insisted that MCS be given some “voice” in managing the project. Reluctantly, Tobin said he would talk with Turner again and attempt to work out an acceptable solution.83 Tobin then called Turner and asked if he could make a joint offer to MCS which would be more palatable; perhaps Turner could agree to use some MCS subcontractors and in that way give MCS a supervisory role. Now it was Turner’s turn to dig in his heels. If his firm was to take full responsibility for the project, he argued, they could not delegate any managerial responsibility to people at MCS or to any others whose abilities they did not know well; he would rather turn down the contract than proceed as Tobin was suggesting. Turner also explained that “these joint venture contracts” typically did not involve dividing the work but only the profits and the risks, and that was the kind of offer he had made to Cotter.84

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A short time later, Walter Jones called on behalf of his “law firm client” and asked if Turner could be persuaded to increase the “percentage arrangement” with MCS. Grasping at that straw, Tobin said he thought perhaps 15–20 percent was possible, and he urged Jones to press that position directly with Turner. Before Jones could do this, however, Cotter intervened and asked that no further efforts be made to persuade Turner to accept a joint venture. It was clear, Cotter said, that Turner was not going to turn over any managerial responsibility to Cotter’s firm, and therefore “it would not be honorable” for MCS to accept a portion of the fees.85 Jones and Tobin conferred and agreed that they had “reached the end of the road” on the Turner-MCS negotiation, and Tobin then approved a news release for December 17, announcing that Turner Construction had been awarded the contract. The “unpleasant consequences” that Tobin had feared emerged five days later, when both Governor Dewey and Governor Driscoll vetoed the contract award, blocking Turner from getting started and raising doubts that the terminal could be completed by the fall 1950 deadline. The formal reason given was the Port Authority’s failure to award the contract to the low bidder; but the agency’s unwillingness to meet the demands of Mallory Stephens and Walter Jones, key Republican legislators and allies of the Republican governors in both states, seems a more persuasive explanation.86 Now Tobin and his colleagues mounted an appeal to Dewey and Driscoll, urging them to accept the award to Turner as the best choice in professional terms, and wiser in political terms as well. They could argue that— if the Port Authority were compelled to reverse its judgment and award the contract to the low bidder—the project would probably be marred by delays in completion; and then there would be possible chaos for bus commuters, and more severe street congestion in Manhattan, as the bus companies were forced to search for places to load and unload once their leases expired at the end of 1950. Several days after the vetoes, the commissioners and Tobin met personally with both governors and pressed their case. Meanwhile, Tobin took an important step to mollify that hungry seeker of commissions, Mallory Stephens. During the heated discussions on the bus contract, Tobin raised the possibility that Stephens might be given the brokerage commissions for the next five years on one Port Authority facility, the Columbia Street Pier. The next week, before the commissioners met with the governors, Tobin persuaded the Port Authority’s main broker, which held the Pier account, to continue “to service this policy in its entirety” while giving all the commissions to Stephens’ firm.87

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A few days later, the governors agreed not to block the Port Authority’s decision, and at a meeting on December 29 the board again voted to award the contract to Turner Construction.88 But now there were only ten months left for Turner to complete the major work on the huge building.

Reverberations and Forward Motion The “unpleasant consequences” which Tobin had forecast did not end with the governors’ actions. In January 1950, MCS lobbied in Albany and Trenton for an investigation of the Port Authority’s practices, and that idea found a ready audience among legislators antagonistic to the Port agency. But Mallory Stephens’ financial prospects had improved, courtesy of the Port Authority, and his wrath had abated; the bills did not emerge from his committee.89 However, the firestorm over the bus-terminal contract made the agency wary of applying its preferred standard—low cost plus a strong performance record—in awarding contracts. Therefore, when the bids for a construction project in Newark were opened in January, and doubts were raised about the quality of the low bidder, Tobin and the Board decided to accept the low bid anyway—“in the overall interest of the organization”—and to “do the best we can” in working with the contractor. The agency also faced sharp criticism from the widely respected Engineering News-Record. The thrust of its editorial argument, quoted in the opening lines of this section, was that the Port Authority had, in bypassing the low bidder, “opened the door” to favoritism and political pressure. The low bid should only be rejected, the News-Record sensibly argued, “when there was good reason to question the low-bidder’s ability to handle the work.” But ENR was on shakier ground when it concluded that rejecting MCS “on the grounds of incompetence” was “obviously impossible.” Moreover, it seemed unable to grasp the link between having Stephens on the MCS board, joined with Walter Jones pleading its case, and the danger of political favoritism. And Tobin, Kyle, and their brethren were in no position to enlighten ENR and its readers.90 But the Port agency soon received signals that it had balanced the demands of effective action and of patronage politics reasonably well. Shortly after Turner was given the green light by the governors, Senator David Van Alstyne, the key figure in the New Jersey legislature when Port Authority business was involved, called Tobin and offered his congratulations for the agency’s firm stance. And Mallory Stephens returned to his traditional role, as reliable helmsman when the Port Authority needed legislative action in Albany.91 Meanwhile, Turner and its subcontractors moved ahead briskly, using

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close managerial control and some innovative methods in the hope of finishing by the first of November. To construct the four levels of structural concrete floors, Turner used its own men, who made 212,000 square feet of forms, which they shifted rapidly as concrete with steel reinforcement was laid down in one section after another. Floor construction was completed on schedule, but when Turner’s team began to erect the walls, in the summer of 1950, they ran into a major hurdle. The bus terminal would use 1.4 million bricks, and New York City was in a building boom, taxing the limited supply of bricklayers. Now the project began to fall behind schedule, and Turner superintendents revised the order of bricklaying, so that priority was given to putting up walls which had to be in position before plumbing and other subcontractors could carry out their tasks.92 For an array of other tasks—terrazzo floors, marble wainscoting, ceiling tiles, finishing of shops and stores, installation of escalators and elevators, etc.—Turner drew upon 34 subcontractors, who employed workers in 26 different trades. Turner assigned its own officials to work closely with the subcontractors and to search for ways to expedite completion, while coping with a myriad of changes needed to meet tenant requirements.93 An especially challenging task was the problem of escalators: with 31 flights of moving stairs called for in the specifications, the bus terminal would include perhaps the largest escalator installations ever placed in one building. Normally, moving stairs were shipped from the manufacturer in small pieces and put together on site. But Turner and the subcontractor decided that time would be saved if a novel approach were used: Each of the 35 flights was completely assembled in a plant in Kansas, then shipped by truck, lifted into the bus terminal by crane, and quickly connected to the driving head and installed. Through a variety of strategies, then, Turner and its several teams made up the time that had been lost due to the bricklayer shortage, and on November 1, the scheduled deadline, the work was completed. The Port Authority’s chairman, Howard Cullman, congratulated Turner for a job well done and announced that the Port Authority Bus Terminal would be open to receive the vehicles of 32 bus companies, and the feet of 120,000 daily bus passengers, earlier than expected—by December 15.94 As Tobin and his colleagues approached that day, they could look back with satisfaction at other pieces of the complex puzzle that had been locked into place during the construction year. In July Cullman and Tobin had persuaded Mayor O’Dwyer to visit the vast structure emerging from the ground near Times Square, and O’Dwyer then shook off the Moses virus and embraced the project with enthusiasm. “The improvement in traffic circulation

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will be tremendous,” he exclaimed. The same day, O’Dwyer gave the several bus companies which had not yet signed contracts for the new terminal just the push the Port agency wanted, announcing that once the new terminal was open, all interstate bus companies would be prohibited from loading and unloading on city streets.95 A crucial part of the plan to make the bus terminal self-supporting was revenue from stores and other services, and during the year, 2,500 applications flowed into the agency’s Department of Concessions. By early December, Robert Curtiss and his staff had allotted space for 42 shops, with another 20 or more locations likely to be available in 1951. Tobin and Curtiss calculated that concession revenue could generate more than half of the total income needed to operate the terminal on a break-even basis.96 The agency also faced engineering challenges beyond those included in the contract with Turner. One of the most important, from the standpoint of safety, was the problem of bus movement up and down the ramps into the upper section of the building. During the winter, snow and ice could lead to dangerous sliding; but to use a team of snow plows during the rush hours would be sure to cause great delays for the hundreds of buses, moving close together. Instead, Engineer Kyle and his staff embedded piping in the rampways, so the road surface could be heated in icy weather.97 In time, the bus terminal might be regarded in Lewis Mumford’s terms, as a “masterpiece of mediocrity,” and as a building to be “taken for granted.”98 But in the final weeks of 1950, it was not taken for granted; the giant bus station was the center of attraction for thousands and then tens of thousands. At the dedication on December 14, Governor Dewey put aside his recent history of tense relations with the Port Authority over airline leases and the bus-terminal contract, as he commended the agency for its “brilliant engineering and planning work.” Governor Driscoll spoke of the bus terminal as a “fine accomplishment” which demonstrated that Washington could with benefit turn more responsibilities back to the states and cities; so he was an optimistic herald for the decentralization campaigns of later decades.99 The region’s major dailies also waxed enthusiastic, embracing a different muse than Lewis Mumford. Rather than a “humdrum job” of engineering or of architecture, the Herald Tribune concluded that the terminal “is a thing of beauty. While built for utility, it instantly impresses the eye. There is nothing ugly. The magnificent expanses, harmonious colorings, flush lighting, graceful arrangement are all part of the inviting whole. This is functional design, to make traveling a pleasure, travel at its very best.” The New York Times agreed, and both praised the terminal’s contribution to saving time for bus

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passengers—an average of twenty minutes per trip—and to reducing street congestion as well. It was a time for celebration.100 More than forty years later, in his sequel to Catch 22, Joseph Heller would imagine the Port Authority Bus Terminal as one of the world’s “great catering halls,” graced at one party by 1,122,000 champagne tulips and 3,500 dinner guests.101 The actual celebration on opening day in 1950 offered some premonitions of Heller’s later tale. A giant cake, eight feet wide and 16 feet long, was unveiled in the main concourse; and 5,500 hungry men and women and children descended on the confection and in three-quarters of an hour consumed it, all 800 pounds. Another 20,000 had to go hungry, but at least they had the comfort of knowing that all 20,000 could ride the new escalators at one time. Then, if they were patient, and waited until Saturday, they might see Lady Iris Mountbatten take her weekly exercise in one of the Port Authority’s thirty bowling alleys.102 And in the opening days, the planning and the drills which Walter Hedden and his associates had carried out, in preparation for the gathering throng, seemed to pay off. The Times’ reporter caught the rhythm: “The crowds at rush hours were tides moving in orderly procession through the immense concourse and the buses rolled in a bumper-to-bumper stream, loading and unloading masses of travelers.”103 Fiorello LaGuardia, that early and fierce champion of the bus-terminal idea, had died a few years earlier. Unhappy as he was to see his airports carried off by the Port agency, he would have found the new building, which now removed from city streets more than 2,000 of those buses he hated, at least partial compensation.

The Ethical Dimensions of Public Programs As many several ways meet in one town; As many fresh streams meet in one salt sea; . . . So may a thousand actions, once afoot, End in one purpose, and be all well borne Without defeat. —King Henry V, 1.2

And in the thousand actions which were needed to create this massive building with its rampway and social tributaries, we can see how complex may be the art of governing in a large urban region.

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Most of the discussion in this chapter has focused on strategies and tactics employed by major actors in this bi-state metropolis—by Robert Moses and Greyhound, by Turner and MCS and Assemblyman Stephens, by Tobin and his aides. This final section uses Stephen Bailey’s distinctive perspective to highlight the ethical issues found in this case. In the next chapter, I will examine normative and strategic issues that are threaded across the several decades of the Port Authority’s creation and early history. In his essay, “The Ethics of Public Service,” Bailey argues that an understanding of ethical principles and pressures in public affairs must begin with a recognition of the “moral ambiguity of all men and of all public policies.”104 We see this ambiguity in government activities described in this chapter—and in particular, in the use of government power to force individuals and families from their homes, in order to achieve some “larger benefit.” Whether a huge bus terminal, or a new highway, or a downtown office complex actually does provide a larger benefit depends, however, on one’s perspective. For example, it seemed very likely that the bus terminal would reduce traffic congestion in Manhattan, and make bus travel more efficient (and therefore more attractive) for commuters and shoppers who might otherwise use automobiles, with some likely further benefits in reducing air pollution in the region. Whether those gains outweighed the losses of familiar neighborhoods and living patterns, for those displaced, is less clear. And when those forced out of their homes are among our poorer citizens, whose political leverage is least, we should pause longer before declaring that these plans and their execution generate a clear net benefit. To take another illustration of “moral ambiguity,” one can argue that the system of “insurance patronage” practiced by the Port Authority in the 1940s was not ethically defensible, viewed in isolation; to provide money for no work, fearing that otherwise the claimant’s political power will be used to harm you, suggests acquiescence in extortion. Then, when Tobin specifically authorized brokerage payments to Stephens in December 1949, while the Port Authority was trying to get Stephens’ heavy foot off its back, we seem to have an indefensible mix of extortion and bribery. Yet, in view of the culture of favoritism which infested New York State politics in that era, perhaps brokerage patronage can be defended as a necessary evil—necessary to permit public officials to assemble the political energy required to carry out large tasks. As citizens and political activists, we can debate the policy issues central to the case: should a union terminal be constructed? should Greyhound be blocked from expanding its own terminals? how should the concerns of those who would be displaced be valued in

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setting policy? But at the end of the day, if we want the decisions that evolve from a thoughtful debate to lead to action, our public leaders may sometimes need to employ the instruments of patronage politics in order to bend the narrow interests of Mallory Stephens and his political bedfellows to a wider cause. Even principled professionals like Thomas Dewey came in time, if reluctantly, to agree.105 In addition to pointing to the moral ambiguity that attends important public decisions, Bailey also argues that there are three essential moral qualities needed by those who would work in government: optimism, courage, and “fairness tempered by charity.”106 All three are displayed in the bus-terminal case. Optimism, as Bailey uses the term, combines a capacity to see the obstacles in the way of achieving a desired goal, joined with a willingness to seek ways to overcome those hurdles and a readiness to act—with some expectation that action may lead to success. “True optimism” is seeing “the worth of taking risks.”107 In this sense, Tobin, Jaffe, and their colleagues were surely optimists. It was the hope, their guarded expectation, that they might emerge with victory which motivated them to press their case—month after month, and then year after year—against the intransigence of Greyhound and the maneuvering of Robert Moses, despite the feckless leadership of Mayor O’Dwyer and the eroded professionalism at the City Planning Commission, and then around the narrow opportunism of Mallory Stephens and his discredited engineering firm. And finally, against the casual irresponsibility that seemed to characterize Dewey’s and Driscoll’s vetoes. Why did they retain a sense of optimism? No doubt it helped that they received enthusiastic support from some of the major daily newspapers and a few civic associations. Perhaps more important, however, was a perspective on public problems that they shared—a sort of virus from the Progressive Era, captured in the original compact, carried forward by Julius Henry Cohen and by that most optimistic of all Port Authority commissioners, Howard Cullman—and passed onward to Tobin and his generation, where it was honed in battles against FDR and the New York region’s airport operators and the airlines.108 That Progressive virus called for systematic analysis of the transportation problem, using the “best scientific understanding,” followed by equally rational analysis of political obstacles and of Machiavellian strategies that might surmount those hurdles. With these intellectual tools, together with the favorable reputation and financial resources that by the mid-1940s at-

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tended all Port Authority proposals, Tobin and his associates could with some confidence settle (in Bailey’s apt phrase) “on the sunnier side of doubt.” And with those tools, they could build coalitions against Robert Moses and his own Machiavellian schemes, scrutinize the fine print in such Moses creations as the “Parking Authority bill,” find the records of trips paid for by Greyhound, and think through new policies that might ease the moral dilemma of forcing the poor out of old tenements. Then they could select a contractor whose own efficiency and creative efforts could dig them out of a potential scheduling disaster; and finally, they could make adroit use of a Progressive tradition—the board of independent engineers—to provide political cover, as they fought against New York’s long tradition of patronage and low-quality performance in construction projects, a tradition which extended back to the building of the Brooklyn Bridge and beyond. Even when Austin Tobin and his colleagues embraced the cause of optimism, however, and employed systematic technical analysis, and built coalitions in support their plans, they did not always win. The New York truck terminal, begun in 1947, finally opened in the fall of 1949, but in the first year of operation it became clear that the trucking companies and drivers were reluctant to rely on an integrated operation run by the Port Authority—echoing the problems seen earlier on the railroad front. Over in Newark, the companion truck terminal was completed in 1950; but the teamsters’ union refused to use it because of disagreement over the Port agency’s labor contract, and the trucking firms which had favored the new facility would not resist the union. Early in 1951, the Newark building was leased to the Air Force for use as a military depot. Within a few years, both terminals were leased to private firms which provided space for trucking companies, allowing them to consolidate local deliveries and perhaps make a modest reduction in local truck traffic. Tobin and his aides were glad to be out of the truck-terminal business and made no effort to go forward with the series of additional terminals that had once been envisioned.109 In addition, the Port agency’s vigorous efforts to expand its seaport operations beyond Newark met with failure in 1949–50 and only a very modest success in the early 1950s. Ironically, within a few years Tobin and his fellow entrepreneurs could see that Machiavelli’s Fortuna well smiled on them, in blocking their strenuous attempts to capture New York’s piers. In sum, the short-term developments were these: As noted in chapter 11, Mayor O’Dwyer asked the Port Authority in the fall of 1947 to study the possibility of taking control of and modernizing the city’s piers. Early in 1948, Tobin submitted a proposal for financing, rehabilitating and operating the vast city waterfront at

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a cost of $114 million in Authority funds. But that proposal was opposed by other city officials; and a revised plan in 1949 was rejected by the Board of Estimate. Behind this resounding defeat for the Port Authority were several factors—reluctance of New York City political leaders to lose control over an historical engine of economic growth and a great source of municipal pride; their desire to maintain control over contracts and jobs on the waterfront; opposition by the longshoremen’s union; and only lukewarm support from the mayor and his aides. The city of Hoboken held out for several years, prompted by a similar mix of motives, but in 1952 the city agreed to turn over its modest waterfront to the Port agency.110 The long-term benefit of the defeat in New York was that the Authority did not invest millions in modernizing that city’s finger piers, which a few years later would be of little use because of the “containership revolution.” In the late 1950s, when it seemed possible that Port Newark could be converted into a containership terminal, the Port Authority had both the funds and the entrepreneurial impatience needed to carry out that experimental and expensive task.111 The second moral quality, courage, comes in several dimensions. The facet best illustrated in the bus-terminal case is “the courage to decide.” There is a strong tendency in government agencies and perhaps in organizations generally to avoid hard decisions, often leading to a sense, and a reality, of organizational drift. Few men in public life illustrated that tendency better than Mayor O’Dwyer, as we have seen in the bus-terminal case. In contrast, Tobin and his colleagues had the courage to decide, to act, and so to endure the arrows of those who felt aggrieved—Greyhound, Robert Moses, Mallory Stephens, and their close cousins in corporate and public life. It was a kind of courage that Tobin shared with his sometime nemesis, the ubiquitous Moses. The willingness of these two public officials to act vigorously in the face of opposition was, quite possibly, a result of important similarities in personality. Both Tobin and Moses appeared to fit the personality profile which Schumpeter identifies as marking the entrepreneur—an “impulse to fight . . . the will to conquer.” Their actions appeared to be shaped substantially by the entrepreneur’s “joy of creating, of getting things done.”112 Bailey’s third moral quality is “fairness tempered by charity.” In the busterminal case, Tobin offers an instructive contrast with Moses and other urban-renewal champions. The willingness of Tobin and the Port Authority commissioners to purchase apartments and slowly move residents away from the terminal site, and to delay the bus project for a year to carry out that pro-

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gram, was striking. It is notable, though, that the relocation program had not only costs but some benefits for the Port Authority as well. News articles carried stories which conveyed the sense that this large public agency could treat the powerless with some respect; and, building on the Port Authority’s relocation work in this and later cases, a New Yorker article in 1954 would offer a detailed and persuasive description of an agency which attempted to exercise power with a sustained sense of compassion.113 If we look across the various pieces of the bus-terminal story, we can, finally, note an interesting contrast which illustrates Tobin’s ethical compass. Facing the challenge of moving tenants out of the way of the terminal, Tobin and his colleagues were willing to delay the project for up to a year. However, when Tobin’s own commissioners asked, during the bidding negotiations with MCS and Turner, whether some delay in finishing the project would be acceptable, so that the contract might go to MCS, Tobin dug in his heels: flexibility during the relocation phase was replaced by rigid commitment to the 1950 deadline. Why? In part, because the time clock had been ticking; the delays during tenant removal increased the impatience of city officials and the Port Authority staff to complete the project, as well as increasing the pressure on the bus companies to sign long-term leases at alternative bus stations. Also, Tobin and his engineering staff were concerned not only about MCS’s reputation for missing deadlines, but also about quality problems that attended that firm’s recent projects. However, Tobin, Jaffe and their colleagues also found an ethical difference between the two causes of delay. The tenants were “deserving” of charity. Mallory Stephens and his engineering confederates were undeserving. Given this view, the “efficiency and economy” face of Progressivism could be directed more sharply against that unworthy band, moderated only by concessions that political prudence seemed to require.

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Part Five

Conclusions

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14 A Regional Empire in American Politics Local History and Its Impact, Leadership Strategies, and Ethical Dilemmas No one who contemplated the course of American politics during the half-century after 1890 could doubt that the teachings of evolution and pragmatism had practical consequences. . . . The pragmatic attitude encouraged scientific planning. . . . Long suspect because associated with notions of regimentation and of socialism, some form of planning was nevertheless imposed on governments by the growing complexity of modern economy and by the fragmentation of administration in the United States. —Henry Steele Commager, The American Mind, 1950, pp. 336, 340

W

hen the construction dust had settled at the Port Authority bus terminal in December 1950, the residents of the nation’s largest metropolis could look with wonderment—and perhaps with some pride—at what had been accomplished in the past three decades: a new kind of public agency had been designed and put into operation, the hostility of local and state officials and influential corporate groups had been overcome, an impressive set of bridges, tunnels, and land terminals had been constructed, and major improvements in the region’s seaport and air transportation systems were underway. By 1950 the Port Authority’s facilities served millions of travelers and shippers a year and were a vital force in the region’s transport system and its general economy.1 In reaching these goals, scientific analysis and political pragmatism had been combined in interesting ways through three decades; and taken all together, the cluster of planning, engineering, and political achievements across these years comprised, perhaps, one of the most creative and successful slices of America’s urban history. But was its success purchased at too large a cost? Some thought so; some think so still. In the paragraphs that follow, I offer some reflections on three aspects of this Port Authority story. First, what contribution does the agency’s creation and evolution make to our understanding of American history in the 359

14-1. The Port of New York Authority’s aiports, marine terminals, bridges, tunnels, and other facilities in 1950. See also Note 1.

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twentieth century? Second, what can we learn from this experience about the nature and conditions of public leadership? Finally, what lessons does this story offer regarding the tension between effective action and democratic accountability?

The Port Authority and Political Reform The field of administration is a field of business. It is removed from the hurry and strife of politics. . . . This discrimination between administration and politics is now, happily, too obvious to need further discussion. —Woodrow Wilson, Political Science Quarterly, 18872

Wilson’s argument is normative, not descriptive. Administrative activities should be insulated from political pressures and deal-making, he argued; and a major challenge for those who would improve the American system of government was to find ways to achieve that difficult goal. During the first years of the twentieth century, that Wilsonian theme became an important aim for Progressive reformers in the New York region and across the country. In this volume, we have concentrated on the branch of Progressivism which sought to bring the standards of insulation and efficiency to regional issues; and whose adherents, led by Julius Henry Cohen and his associates, directed their attention toward the need for improved transportation as a crucial route toward ensuring economic growth in New York City and its hinterland. One contribution of this volume, then, is to provide a slice of political history, focused on this bi-state metropolis. Here we have followed the forces that led to the creation of a new kind of governmental agency, the modern public authority, and the strategies through which the New York progenitor was able to carry a distinctive banner of Progressivism into the 1920s and beyond. The struggle to persuade the nation’s railroads to embrace cooperative planning in the name of efficiency; the efforts to overcome localism and interstate antagonisms in order to build a series of major bridges and tunnels in the 1920s and 1930s; and the sustained campaigns in the 1940s for airport development and an interstate bus terminal—all these can be viewed as extensions of the Progressive thesis that scientific expertise and rational planning should be applied to important social issues, and that this could best be done through special public agencies which are insulated from “the hurry and strife of politics.”

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Moreover, as already noted, those activities—and indeed the wide range of initiatives by the Port Authority during its first three decades and more— were also enlivened by the sense of optimism which suffused the Progressive campaigns in the years before World War I, and which for the next several decades animated this new public agency under Cohen, Ammann, and Tobin.3 Two nation-wide campaigns in which the Port Authority had a crucial role illustrate this sense of optimism—as well as the lively possibilities, inherent in a federal system, for marshalling regional energies to challenge national power, and to respond creatively to social problems when the national government fails to act. Again, Woodrow Wilson captured this theme in his 1887 essay, as he sought principles which would be “congenial to American habit”: “Our duty is to supply the best possible life to a federal organization, to systems within systems; to make town, city, county, state, and federal governments live with a like strength . . . keeping each unquestionably its own master and yet making all interdependent and co-operative.”4 That happy result would be possible, as Louis Brandeis and other Wilsonians warned, only if each state were permitted to “remould, through experimentation, our economic practices and institutions to meet changing social and economic needs.”5 These intertwined arguments for experimentation and interdependence are exemplified by the Port Authority’s successful fight to defend tax exemption for municipal bonds, and by the campaign against the airlines’ monopoly power—a campaign carried out by a nation-wide coalition of state and local agencies, while the federal government sat on the sidelines. For those who would look to our states and cities for new ways to improve efficiency in public projects and programs, the planning and execution of the bus-terminal project also offers an encouraging example. And to advocates of compassionate policies when our most vulnerable citizens are affected, the relocation methods devised by Tobin’s aides, and later emulated by New York State and other public bodies, are instructive.6 In the current era of renewed attention to state and local initiatives and energy, the patterns described in this study should be of particular interest. As Justice Anthony Kennedy recently observed, the states can still be “laboratories for experimentation,” trying out a variety of strategies when “the best solution is far from clear.”7 The Port Authority story is important, as these comments suggest, not only to those who have a local interest, directed toward understanding the causal forces that shaped transportation developments in the New York re-

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gion during the first half of this century, and the patterns of regional job movement and residential change that were influenced by those transportation improvements. Beyond its own region, the agency’s leadership in the campaign to protect tax-exempt bonds has been a key force in protecting the capacity of cities and states across the country to finance their preferred capital needs. And the airport coalition which its leaders knit together was an important factor in speeding the modernization of air travel throughout the United States. Moreover, the Port of New York Authority was the first governmental agency in the United States to be called an “authority” and the first public agency which relied on revenue bonds and user payments (rather than general taxes) to carry out large capital projects. Therefore, once its first decade’s activities were viewed as successful, and its accomplishments were heralded as linked to its “nonpolitical” and “businesslike” demeanor, the “port authority model” was propelled into widespread use; dozens, then hundreds sprouted in the cities and regions of America and then abroad.8 In addition, as I suggested in chapter 4, the Port Authority story can contribute to our understanding of the continuing tension between localism and the forces of rationalism and national centralization. Samuel Hays points out that the political evolution of modern America can be viewed in terms of a sustained conflict between “grass-roots impulses,” on the one hand, and “the spirit of science and technology, of rational system and organization,” whose champions would shift the locus of political decisionmaking away from communities, and toward the preferences of national actors intertwined with large technological changes. The Port Authority’s battles in the fields of air transport and maritime projects illustrate the argument that “rational system” joined with technological change may try to undermine localism—and sometimes win out. And it is true that the Port agency tended to calculate benefits and costs for the region as a whole, valuing less than local leaders the negative impacts that might be felt in Jersey City, or Fort Lee, or Brooklyn.9 However, the Port agency’s cudgel was also used to battle against national interests—the organized railroads and the air transport monopolists— on behalf of regional priorities (and regional efficiency), and even, in the AOC fight, on behalf of localism joined to professionalism. Nor does the busterminal story fit the Haysian generalization; in that long campaign against Robert Moses and his friends, described in chapter 13, the Port Authority’s “spirit . . . of rational system” seemed in some harmony with the preference of city residents and other localized interests.

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Leadership in American Politics Government management tends to be driven by the constraints on the organization, not the tasks of the organization. . . . Whereas business management focuses on the “bottom line” (that is, profits), government management focuses on the “top line” (that is, constraints). —James Q. Wilson, Bureaucracy, 1989, p. 115

A crucial argument in Bureaucracy is that public agencies are burdened by heavy shackles placed on their activities by legislatures, courts, politicians, and interest groups. As a result, their leaders must devote much of their energy to meeting “the demands of these external entities.” This is the fate, Wilson concludes, of “all government agencies.”10 No reader of the stories analyzed in this volume would find Wilson’s generalizations adequate to the Port Authority’s history. In part, the explanation is that some government agencies—the Port Authority among them—have been designed so that their officials can exercise greater control over their program goals, financing, and other factors than is true of line departments in municipal and state governments.11 So perhaps Wilson is correct about government organizations generally; and one solution might be to design more public agencies as semi-autonomous authorities—so that they can focus more fully on their tasks and how to achieve their goals efficiently. In fact, building on the experience of public authorities in the early postwar decades, this has been a prominent argument in recent years. We see it, for example, in the creation of the Metropolitan Washington Airports Authority in 1987; in the recurrent campaign to place major functions of the Federal Aviation Agency in a new “Federal Aviation Corporation,” which might be given the kind of autonomy in financing and in modernization strategies associated traditionally with the strongest port authorities; and in the proposal by New York City’s mayor to create an Infrastructure Financing Authority, which would have an independent source of income and be expected to place high priority on ensuring construction integrity coupled with disciplined cost control.12 But this response would not satisfy James Q. Wilson’s standard. In fact, he uses one of the existing government corporations—the U.S. Postal Service— to illustrate his general and pessimistic argument. Wilson does refer to some positive results from creating this semi-independent agency. For example, he notes that the old department rarely closed a small local post office (because of opposition from the local member of Congress), but that once it was trans-

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formed in 1971 into the “semiautonomous” USPS, it was able to close inefficient offices at a rate which reached 200 per year in the 1980s. The new agency also determined to set postage rates high enough so that each class of mail would be self-supporting; and though some interest groups opposed that change, the agency emerged victorious. Moreover, the USPS was given the power to raise capital by issuing bonds, as Wilson notes, and therefore it has been able to move ahead rapidly to automate mail sorting. But it has not won every battle: Congressional pressure has blocked the USPS from ending Saturday mail deliveries and raised new hurdles to closing rural post offices. To Wilson, the bottom line of the Postal Service story is that it illustrates his general argument—“political supervision of the factors of production leads managers to become constraint-oriented rather than task-oriented.”13 However, his description could be interpreted quite differently—focusing on how much has been accomplished by USPS executives, who surely must have been at least partly oriented to task, in order to carry out the closings and modernization that Wilson and his sources have praised. Perhaps the difference in how one evaluates the Postal Service story—and how, more generally, one views the prospects for energetic leadership in government—can be captured by a familiar image: Is the glass half full or half empty? The government executive (or observer) who focuses on constraints will find them endlessly, and may be rendered immobile. Even the semi-independent Port Authority could (like the Postal Service) be blocked by its political supervisors—by gubernatorial vetoes, legislative action or inaction, and the refusal of local governments to yield up their airports and marine terminals. It could be, and sometimes it was—by the ICC leaders and other federal officials whose failure to act in the 1920s doomed the Port agency’s regional rail plan; by New York City, which refused throughout the 1940s and beyond to turn over the city-owned piers; and for several years, by those who stood in the way of the bus-terminal project. To the Port Authority’s leaders, however—to Cohen, Ammann, and Tobin, and to Commissioners Outerbridge, Cullman, Byrne, and a few other key members of the Board—the glass was viewed as half full, as they focused their efforts on tasks that needed to be done to satisfy their own energy and ambition, and often to serve the wider needs of the metropolis as well. Of course energy and ambition would not serve alone; the Authority’s leaders in those decades also required strategic skills of a high order: they had to be able to thread their way through the political fragmentation and hostilities of a complex region, to build alliances in support of their plans, and (to paraphrase William Riker) to “structure the world so they could win.”

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This is not a perspective and set of strategies that is unique, among government organizations, to the Port of New York Authority. “Entrepreneurial” leadership—as defined by Schumpeter and employed in this study—can be found in many government agencies. We find it at various times in the semiindependent authorities of Los Angeles, Oakland, and Washington state, in the metropolitan regions of Boston and Washington, D.C., and in the Tennessee Valley. A similar brand of leadership appears at times in state and national line agencies concerned with public health. At the national level, we can also see the main elements of entrepreneurial action in NASA under James Webb, in Hyman Rickover’s adroit leadership of the nuclear ship program, in Nancy Hanks’ skilled efforts at the National Endowment of the Arts, and in the strategies of Wilbur Cohen and Robert Ball to create and maintain the Social Security program.14 The selective nature of the pessimistic (or “half empty”) perspective is illustrated in Wilson’s treatment of some important changes in military programs. In a gloomy discussion of the aversion of government agencies to embracing “real innovations,” Wilson argues that “many important changes in the military” were “reactions to political demands: Some key air force generals were at first reluctant to develop the intercontinental missile; the navy for a long time was unsure about the desirability of a submarine-launch missile program.”15 Would it not be possible to use a similar tone in describing the Port Authority’s history between 1921 and 1950? The agency’s leaders were reluctant to expand the agency’s mission to include projects for motor vehicles, and external pressures were crucial in bringing about this major change. Moreover, the Port Authority’s decision to propose a large bus terminal in Manhattan was, certainly, a “reaction to political demands” from officials in the LaGuardia Administration.16 However, the relationship between any public agency and its surroundings is likely to be interactive and dynamic. The challenge for entrepreneurial leaders is to respond in creative ways to external demands, and on occasion to help create such “external demands” so that they can serve as tools on behalf of the leader’s own goals. Wilson’s argument sharply underplays this dynamic. Yet Wilson is too good an observer and scholar to miss entirely the optimistic possibilities for leadership that inhere in government agencies and their environments. His own analysis includes striking examples of leaders who were focused on task and who have had a major impact in changing organizational missions and behavior—in the Marine Corps in the 1930s, for example, in the FBI under Clarence Kelley in the 1970s, and at the Federal Trade Commission under Caspar Weinberger.17 To Wilson, however, em-

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ploying his lens of dubiety, the prospects for such entrepreneurial behavior in government are very rare. But when he finds those rare “gifted political executives,” Wilson embraces them with a modest passion. They are able to succeed, he observes, because they “do more than merely acquire constituency support; they project a compelling vision of the tasks, culture, and importance of their agencies.” The “greatest executives,” Wilson concludes, “infuse their organizations with value and convince others that this value is not merely useful to the bureau but essential to the polity.”18 In these moments of enthusiasm, Wilson may reach too far. His prominent examples of this high state include J. Edgar Hoover and Robert Moses, whose entrepreneurial skills are generally seen as deeply intertwined with abuse of power. In a democratic society, surely, the true measure of “greatness”—of both public agencies and their leaders—must take us beyond the rhetorical and strategic strengths Wilson emphasizes; we need to examine the ethical dimension of leadership as well.19

Accountability, Integrity and Prudence In the ethical realm, the entrepreneurial model confronts massive resistance. The principal obstacle . . . is its apparent conflict with democratic theory. —Colin Diver, “Engineers and Entrepreneurs,” Journal of Policy Analysis and Management (1982), pp. 403–404

As Colin Diver suggests, the kind of leadership needed to meet complex social problems—requiring flexibility and initiative, the capacity to marshal resources quickly, and the ability to act with vigor and sustained attention to long-term goals—will often conflict with the traditional standards used in the United States to ensure democratic accountability. This tension is especially evident in the public authority, which is consciously designed to be “insulated” from partisan politics and the direct control of elected officials. Yet the conflict is a continuing challenge for all public executives whose agencies operate in an environment with changing societal needs and whose employees must use judgment and discretion.20 In our public discourse, as in the scholarly literature, the tension between accountability and effective action is often framed as a zero-sum game: to achieve high levels of efficiency and effectiveness requires insulation from the normal play of democratic politics. The New York Times, looking back in

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1950 at the Port Authority’s record, cast the issue in this way: “It is independent, or autonomous, because it was planned that way, for only in the independence from political pressures, from selfish unilateral greeds and from the appetite for patronage or favor could the improvement of the port district go forward to the general good.”21 The newspaper reporter who followed the Port Authority’s work most closely during the 1930s and 1940s, and who often wrote critically about its activities, underscored the apparent trade-off, as he reflected on the agency at mid-century: There are two things that strike the casual observer upon stepping from a City Hall into the 15-story building which houses the authority. . . . The first is the private-business atmosphere in which the public agency conducts its operations. The second is the incredible vigor and efficiency of the authority organization, as contrasted with the slumberland of the average City Hall.22

Stressing the downside of the agency’s energy and autonomy, the Daily Mirror attacked the Port Authority as “virtually a sovereign entity within itself” and argued that the state legislatures must “define the precise limits of its powers. . . . It is perilous practice in a democracy to build up a super-state however noble its administration and monumental its accomplishments.”23 Perhaps, however, there is a more nuanced way to consider these issues of insulation and effectiveness. In their recent writings, Philip Selznick and Patrick Dobel grapple with this problem in a particularly helpful way. In The Moral Commonwealth, Selznick observes that the “conflicting demands of autonomy and responsiveness” are present in every public agency, but that they are “especially important” in public authorities which have substantial financial autonomy, coupled with “broad discretion to use their resources as they see fit.” He acknowledges the tendency for officials of these enterprises to frame their goals narrowly and then define their options as if only technical requirements need be considered. The challenge as he sees it is to find ways to enlarge accountability “without giving up the main benefit of autonomy: long-range, flexible, purposive, ‘nonpolitical’ management.”24 The solution, for Selznick, comes in two parts—external standards which elected officials and courts can use to monitor and evaluate the agency’s activities; and the development, inside the agency, of an “inner commitment to moral restraint and aspiration.” This internal ethical structure should be derived, he argues, from a careful analysis of the long-term functions which the

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agency is expected to serve in its city or wider region. An adequate moral structure requires that the organization’s leaders and other members continually engage in “moral reasoning”—asking, “Are the postulated ends worth pursuing, in the light of the means they seem to require? . . . What costs are imposed on other ends and other values?” This reflective ethical stance should properly have a deep influence on the culture and programs of the agency—especially in the independent authority, and most likely in every government body.25 Selznick’s way of framing the issue alerts us to important questions that should be asked in determining whether the policies and programs of the Port Authority—or of any government agency—adequately meet the test of “democratic accountability.” Do clear standards exist, and can they actually be used by the public and its elected officials to monitor the agency’s activities? Also, do the agency’s leaders define their mission broadly—or do they focus on technical matters, coupled with efforts to persuade their staff (and the wider public) that engineering and economic calculations are the only legitimate measures, in evaluating the agency’s work? More generally, does the government agency meet the standards of accountability and responsiveness sufficiently to justify its current level of autonomy, or should changes, small or large, be made to bring it under tighter control? In “Integrity in the Public Service” and his other works, Dobel constructs a framework for assessing the ethical behavior of public organizations which is compatible with Selznick’s perspective and which expands our understanding further, directing our attention to dimensions of the Port Authority’s ethical stance which should be crucial in our assessment. Dobel’s account identifies three models which might be used (and often are used) by executives in making policy decisions and in justifying their actions. However, each model “standing alone generates abuses inherent in its logic,” and to operate at a high ethical standard, leaders must make conscious use of all three, holding “each of them in tension as they frame judgments and actions.”26 The first of the three perspectives (the legal-institutional model) requires that laws and rules be clear, that discretion be highly limited, and that agency officials carry out their tasks under those tight constraints; thereby, “democratic accountability” would be assured. Applied to the field of public authorities, this standard would ask that legislatures provide detailed laws and compel authority executives to obtain approval from elected officials before undertaking new program initiatives or making modest changes in existing programs.27 If carried too far this strategy might, as Dobel suggests, produce a set of public officials who are “timid, reactive, and rule-bound”; the benefits of autonomy which Selznick describes would be lost.

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The second approach emphasizes personal responsibility. Officials are expected to be alert to the implications or results of existing programs and plans which would violate their personal sense of a moral society; they should then use that standard to shape their own behavior—leading (when that personal standard is violated) to dissent from existing policy, to efforts to alter programs, and to resignation when necessary. However, to embrace this as the predominant guide for individual action may lead to abuses, Dobel warns, as the strongly motivated but illegal actions of Iran-contra participants illustrate.28 Dobel’s third model directs our attention to the “effectiveness” side of the tension with accountability. But his way of exploring this perspective broadens it beyond the usual definition, which emphasizes the ability to achieve the agency’s goals—to build bridges and tunnels, for example; to take control of and modernize the region’s airports; to construct a massive bus terminal in crowded New York. Instead, Dobel frames the third perspective as prudential action, which should be guided not only by a search for program effectiveness (does the airport function well?) but more: “Public officials have added responsibilities beyond their immediate policy goals. They are charged to preserve and protect the legitimacy of [democratic] political authority. Every official act builds or tears down regime legitimacy, and these realities should be factored into political prudence.”29 For Dobel as for Selznick, then, the leaders of complex organizations should be sensitive to wider social values and potential costs; they must be concerned, for example, with the question of whether new policy initiatives and program changes will strengthen or weaken the citizen’s confidence in the institutions of governance. How well did the Port Authority—in the era of Cohen, Ammann, and Tobin—meet the criteria set down by Selznick and Dobel? We can begin by noting that all three officials embraced a Progressive standard of the use of public power to meet important social needs: If long-term planning and investment were required, the design for action should place responsibility very substantially in the hands of experts. The public should have a voice, certainly, but that voice should be muted, expressed through filters, kept at bay so it does not lead to meddling in the daily details of action—so that (as the New York Times argued in 1950) “selfish unilateral greeds” and “the appetite for patronage” would not erode the quality of decisions or the capacity to take action with skill and energy. Who, among those who have followed the travails of public agencies in the 1980s and 1990s, would deny the relevance of the Times’ warning for today? Moreover, the Port Authority’s early leaders could not embrace accountability via the legal-institutional model. As we saw in chapter 2, Cohen hoped

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to give to his new enterprise almost unrestricted control over development decisions, and the laws that were finally accepted at Albany and Trenton did give wide discretion to the agency. He resisted plans to give veto power to the governors; and he was ready to challenge the veto power in court if it had been used in ways that Cohen considered in conflict with the independence that he thought the Port Authority must have. But Cohen was a product of his own times, too deeply engaged, perhaps, in battles against New York’s Tammany Hall and the Hudson County machine of Frank Hague to appreciate the benefits of a vigorous and observant local polity—and the advantage too of disciplined oversight by the states’ governors.30 Austin Tobin held a more complex view. Political prudence, as Dobel defines it, motivated much of his action. Tobin accepted the governors’ veto power, where Cohen did not, as essential to the legitimacy of the whole Port Authority enterprise; to resist that control would not only be politically risky, it would also undermine the connection between entrepreneurial public action and the appropriate supervision by elected officials. Similarly, in the tax-exempt bond fight, Tobin campaigned in defense of the ability of local governments to carry out their own programs, against what he thought were oppressive actions by the national government. For those who judged that he acted mainly to advance his own reputation, it is useful to note that the viability and the quality of local government were also his concern a decade later in the battle against the airlines. And if skeptics respond by arguing that the municipal-bonds battle and the fight for airports were led by Tobin and his Port Authority mainly because those campaigns strengthened their own political power, might we answer: Then perhaps the Port Authority was well designed, if its “self-interested actions” led to outcomes that were socially beneficial. In the case of the national airport alliance, at least, that is almost certainly the right answer.31 As one looks more closely at the 1930s and the 1940s, the “Tobin dimension” is almost endlessly instructive. His strategy for grass-roots activity to shape Congressional action, described in chapter 10, broke new ground in political campaigning on national issues. But does that dimension advance or tear down the quality of our democracy? The issue is worth pondering, and in the 1990s it was still unresolved. What of his strategic actions to take control of the region’s airports, which undercut the power of Robert Moses and the preferences of New York’s mayor and Newark’s elected officials? Did they damage the vitality of democracy in those cities? My own sense is that they probably did; had the airports and Newark’s seaport been more directly accountable to local elected officials in the 1940s and 1950s, their citi-

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zens might have been forced to confront the pros and cons of allowing short-term patronage advantages to overwhelm the economic-development potential of their undercapitalized airports and marine terminals. But would political reform and more effective city programs have followed? Perhaps not. Note that New York City successfully resisted the Port Authority’s efforts to take control of the City’s marine terminals; and during the next two decades the City’s maritime facilities, continuously under-funded and patronage-ridden, fell into the harbor while the Port Authority’s Newark and Elizabeth seaport thrived.32 Or to take another slice of the Tobin story: When he resisted the antiSemitism of his boss, Frank Ferguson, he displayed the kind of personal integrity which Dobel identifies as a distinctive ethical stance. However, perhaps Tobin should have pressed the issue even more strongly in his first months in office, threatening to resign. His willingness to endure Ferguson’s behavior lasted from 1942 until early 1945, and led to the loss of two of his most imaginative associates. On the other hand, he kept fighting and ultimately won a victory—which might have been lost had he forced the issue earlier.33 A few years later, as described in chapter 13, Tobin faced an array of ethical issues—the Moses stratagem to undermine the Port Authority’s plans for a bus terminal, the problem of relocating the tenants in the path of the terminal, and political pressures to award the main construction contract to the firm which was most influential politically. Here, his standards of personal integrity and the criterion of prudence were mutually reinforcing, producing an array of battles and administrative actions that while fraught with risk offered great potential benefits as well. In a recent essay, Gertrude Himmelfarb reminds us that, rightly understood, politics consists of more than “the struggle for money, power, privilege, position.” Political action also embraces “the attempt to restrain those self-serving motives, to create out of them, or to impose upon them, a structure of government that will serve society as a whole.”34 The story told in this volume illustrates both the narrow and the wider view of what politics is about, and one lesson of this history is that conscious and sustained efforts in the public arena can sometimes yield a positive result. Narrowly self-interested behavior will be part of the mix, and chance will make its contribution too. But with energy, optimism and skill, entrepreneurs in government can ofttimes achieve real benefits both for the citizens they are directly charged with assisting and for the wider society.

Epilogue

Triumphs and Travails of an Aging Empire

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early half a century has passed since the Manhattan bus terminal received its first passengers and the Port Authority turned to the challenges of the 1950s and beyond. Like the first 30 years of the Port Authority’s life, these decades have been marked by sharp political conflicts, by impressive accomplishments and significant failures, and by periods of drift—when patronage and pork-barrel demands have eroded the agency’s financial and human capital. In the pages below, I review the major developments since 1950, which tend to illustrate and reinforce the main themes considered in chapter 14— the tensions between insulation and close accountability to elected officials; the optimism and readiness to try new initiatives embodied in Schumpeter’s entrepreneurs; and the challenge of maintaining a coherent mission and staff esprit in the face of daunting political pressures. This compact summary is delivered to the reader’s plate in two servings. The first extends from 1950 to 1971, when Austin Tobin left the bi-state agency; and the second stretches from 1972 to the present, as the Port Authority’s leaders and the governors have struggled with the issue of how best to use the agency’s energy, and its profits. Today, the Port Authority’s array of activities still contributes in important ways to economic growth across the bi-state metropolis, and, effectively led, it has the ability to do more. Whether that potential can be realized will depend, as it has throughout its history, on the capacity of the states’ chief executives to provide the kind of disciplined policy oversight offered by Al Smith in the 1920s and by Governors Dewey and Driscoll in the 1940s. As the final pages of the Epilogue will show, the recent history of gubernatorial inattention to the regional mission and potential of the Port Authority indicates that the necessary political will—and sense of vision—required at the state capitals is notable by its absence, as it has been for much of the past three decades. With a dose of Julius Henry Cohen’s optimism, however, we might anticipate that the new century will offer greater opportunities to this tethered empire, still one of the nation’s most interesting regional governments. 373

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1950–1971: Creative Energy, Missteps, and Austin Tobin’s Final Conflicts These were Tobin’s years; and the institution, both in its strengths and in its weaknesses, largely illustrated Emerson’s aphorism that “an institution is the lengthened shadow of one man.” During the 1950s, an array of initiatives and accomplishments at the Port Authority showed Tobin at his best—and illustrated as well the advantages of insulation and of a wide field of choices across which an entrepreneurial leader might roam. Throughout these years, and into the 1960s, Tobin and his team exemplified Schumpeter’s classic entrepreneur, as they had in the 1930s and 1940s, in their “joy of creating, of getting things done” and their readiness to do battle against those who stood in their way.1 Yet in the 1950s, we see also evidence of vulnerability—in Tobin’s impatience with democratic oversight as it was embodied in the governors’ demands; in his preference to fight when compromise might better serve the interests of the Port agency; and as to two major projects—the World Trade Center and a proposed new airport—in a thinning of the strategic skills displayed in the 1940s, together with a willingness to set aside expert analysis when it conflicted with the pursuit of monumental projects. These weaknesses extended into the 1960s and beyond, undermining the Port Authority’s reputation and Tobin’s ability to lead the agency. Finally, in December 1971, he suddenly departed, in frustration and anger, leaving an extraordinary legacy of achievements—but an agency which no longer commanded wide support at the state capitals, or among local leaders, or in the press. It was an agency already going adrift. The two most important accomplishments of these decades were the Port Authority’s role in developing containerport operations, and the joint effort with Robert Moses to expand the region’s arterial highway system. Innovations in Shipping The story of containerization, with its revolutionary impact on freight transport in the U.S. and around the world, began at Port Newark in the mid-1950s. Until 1955, the Port agency had pursued a strategy of trying to take control of traditional pier operations on both sides of the Hudson. In 1947, as recounted in chapter 11, Tobin and his aides had taken responsibility for Port Newark. In 1948 and 1949, they had also submitted proposals to capture New York City’s 200 docks and piers, but those plans had been rejected by New York City’s governing body. The agency was more

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successful at Hoboken; after five years of arduous negotiations, the city fathers signed an agreement in 1952, and the Port agency soon began building and operating new terminals along the Hoboken waterfront, across the Hudson River from Manhattan.2 By 1955, freight tonnage handled at Port Newark and Hoboken was increasing by more than 15 percent a year, and it seemed clear to Tobin and his marine terminals director, Lyle King, that more pier space was needed. Again, the well-honed approach was used: New Jersey’s governor, Robert Meyner, was prompted to ask for a study; the Port agency quickly responded; and in December 1955, Governor Meyner announced that the Port Authority would extend its Newark facility to the south, into the city of Elizabeth; the ElizabethPort Authority Piers would be built on 640 acres of tidal marshlands.3 The Authority’s plan seemed initially to be no more than an expansion of the standard marine terminal (with break-bulk loading and unloading, and the use of storage sheds on the docks), but informal discussions were already underway that would make Elizabeth a major project in revolutionizing the nation’s cargo-handling system. Those conversations began during the early months of 1954, when Malcom McLean, the president of McLean Trucking, approached Tobin and Lyle King to inquire whether the Port Authority would join forces with his firm to create a new system for transferring freight from trucks to ships. Rather than unloading truck freight into dockside storage sheds, and then hoisting it “break-bulk” onto ships, the entire truck trailers (all but the motorized cab and flat body on wheels) would be lifted by cranes and stacked on specially designed ships. Tobin, King and McLean soon reached an agreement: one of Port Newark’s docks was modified so that trucks could be brought near ship berths, and cranes then lifted the truck trailers (or “containers”) on board. On April 26, 1956 the first “container ship,” owned by McLean’s Sea-Land firm, was loaded at Newark with 58 truck trailers for its maiden voyage, to Houston. Sea-Land added service from Newark to Puerto Rico in 1958, and McLean then sought to extend service to the West Coast and to Europe. However, the McLean innovation encountered skepticism from steamship companies and some port executives, who doubted that the large capital investments needed to redesign piers and storage areas could be justified. Realizing that the Newark/Elizabeth innovation would be successful only if other ports could send and receive containers, Tobin, King, and the Port Commerce staff under Clifford O’Hara worked with port officials in Oakland, Rotterdam, and other cities to overcome their reluctance. Meanwhile,

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the initial phase of the Elizabeth project was redesigned for container service, and in 1962 Sea-Land became its first tenant. By then, Oakland’s port officials had invested in container facilities, and Sea-Land added service to that port; and in 1966 service was initiated to Rotterdam. During the next decade, with its open docks and its vast upland storage area for containers, Elizabeth became the centerpiece of the Port agency’s innovative effort, and the largest containerport in the world. What had once seemed a risky venture for the Port Authority was, by the 1970s, a widely acclaimed success.4 New Bridges and Highways The second major achievement of the 1950s and 1960s was the arterial program devised by the Port Authority, jointly with Robert Moses, which led to the construction of the Verrazano-Narrows Bridge joining Staten Island and Brooklyn, the Throgs Neck crossing (from The Bronx over the East River into Queens, east of LaGuardia Airport), and the lower deck of the George Washington Bridge—as well as a new interstate highway, Route 80, in New Jersey and an array of related highway projects. That complex effort had its origins in the early 1950s, when Moses and Tobin overcame their earlier history of conflict.5 As traffic congestion built up throughout the region in these years, new arterial roadways seemed essential. Since the Port Authority was limited to interstate crossings, while Moses’ agencies had to operate entirely within New York State, neither could meet this region-wide problem by acting alone. If they cooperated, however, they could enhance the opportunities available to both, including possible additions to the magnificent string of bridges which had brought acclaim to Moses and the Port agency in earlier decades.6 A joint program did emerge in 1954. But how? There are two distinct and plausible explanations, and both are summarized below. According to Moses’ biographer, Robert Caro, Moses conceived the entire plan, laid the program before a surprised Austin Tobin and his commissioners, and persuaded them to help Moses carry out his proposals. More specifically, Caro’s history goes this way: During 1953, Moses thought about his grand dreams—for new bridges and highways and other enterprises—and he looked at his resources, which were “nowhere near as vast as his dreams.” He thought about a great bridge over the Narrows, and he also envisioned a span across the East River at Throgs Neck, which he “must get underway as soon as possible.” Then he thought about the advantages of joining forces with “his old foe,” the Port Authority.7 The Port Authority had even more surplus funds available to invest in new projects than Moses’ Triborough Authority; but while it was “long on cash,” Caro writes, the bi-state agency was “short on dreams.” The “vision-

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aries who had created it” were “long gone from its councils.” They had been replaced by “money men like Cullman and Colt and Pope, whose eyes were brightened by the balances in the Authority’s ledgers, not by the potentialities for improving the common weal that those balances represented.” Of course the Port Authority did have some plans, but they were “unrelated plans, plans for individual projects, joined by no link” other than the prospect for more profit. Though the Port agency had more money than Moses, it had “no more than a fraction of his creative vision.” So, in Caro’s version, Moses worked out a detailed arterial program before he conferred with the bi-state agency. Then, “sometime late in 1953 or early 1954, over luncheon at Randall’s Island, he broached to the Port Authority board a plan of staggering scope.” By February 1954 the Port agency had agreed to join forces to carry out “Moses’ plan”; a joint study was then carried out, and in January 1955 the joint report was released to the press. The highways and bridges which “Robert Moses had laid out under the Joint Program” were, Caro concludes, “the creations of a single individual, public works sprung from that individual’s private creative vision, financed and approved as a result of his unique political genius.”8 A stirring story. But is the history accurate, the flattery deserved? Based on evidence available in Port Authority documents, and through interviews, an alternative history seems much closer to the mark.9 By early 1953, traffic congestion at the Lincoln and Holland tunnels and the George Washington Bridge had become severe, especially during rush hours, and business leaders and others urged the Port Authority to construct additional tunnels or bridges between New Jersey and Manhattan. A second tube at the Lincoln Tunnel had been opened in the late 1940s and a third tube would be completed in 1957. There was pressure from influential business executives to move forward quickly with plans to add a third tube to the Holland Tunnel, which entered Manhattan near Canal Street. However, when the Port agency’s staff studied traffic patterns in 1951–52, it seemed clear that any additional crossings into Manhattan would be useful only during rush hours and would not, therefore, generate enough traffic to pay for construction and operation. Moreover, when the planning staff under Roger Gilman (Walter Hedden’s successor), analyzed the traffic patterns of those who used the trans-Hudson vehicular crossings, it became clear that many of these automobile and truck drivers started their trips outside the congested center of the region and also wanted to reach destinations outside the core—out on Long Island, or in Westchester and New England to the north, or in suburban New Jersey, and points south and west.

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Gilman and his planners then conferred with Tobin, and it seemed to them far more sensible to design ways to permit these travelers to go around the clogged centers of Manhattan, Brooklyn, Newark and Hudson County, rather than forcing additional roads through those densely populated centers—as Moses wanted to do with his proposals for new expressways in the heart of Manhattan.10 A southern route around Manhattan could send travelers from New Jersey onto Staten Island (happily over Port Authority bridges, which were lightly used and not paying their own way), and then across a new bridge over the Narrows—the waterway that links the Atlantic Ocean to Upper New York Bay. That bridge would land near the southern end of Brooklyn, where trucks and automobiles could continue to destinations in the outer boroughs and Long Island suburbs. In the first weeks of 1953, Tobin conferred with George Spargo, general manager of Moses’ Triborough Authority, who said that Triborough “might be in a [financial] position to go forward with such a bridge” by the late 1950s.11 During the spring and summer of 1953, Gilman and his staff sketched out a set of highway routes that could respond to these growing “circumferential” traffic patterns and discussed them with Tobin and the Port Authority commissioners. In addition to the southern bypass over the Narrows, the planners proposed a northern bypass, which would include a new highway (Route 80) bringing traffic from New Jersey to the George Washington Bridge, a second deck on that bridge, and (on the New York side) the CrossBronx Expressway, which was already underway, and the Bronx-Whitestone Bridge (built in the 1930s), which carried traffic across the East River to Queens and Long Island. Tobin obtained the approval of his board for detailed surveys of the possible northern and southern routes, and in the fall of 1953 he visited his old enemy and outlined his proposal for a cooperative study. (“I left the door open behind me when I went in,” Tobin later recalled, “in case I had to make a fast exit.”) But Tobin was welcomed with something close to open arms, for his proposal offered the possibility that Moses could at last create the jewel of the region’s arterial system—the longest single-span bridge in the world across the Narrows. Moses had for years wanted to construct that bridge, but he had been compelled to defer it until Triborough tolls produced the needed money; now Tobin said that the Port Authority could at once advance the funds, which Triborough could later repay.12 During the next year, the two agencies carried out a detailed study of traffic flows and highway congestion. In the spring of 1954, one of the Port agency’s senior planners, Nathan Cherniack, realized that increased traffic over

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the northern bypass route would face a critical bottleneck at the BronxWhitestone span, and he suggested the study be expanded to consider a second crossing to Long Island, parallel to that bridge. With Moses’ consent, a possible span at Throgs Neck was then added to the surveys. By the end of 1954, Moses and the Port Authority had agreed on a detailed region-wide plan, and in January 1955 they announced that they were ready to join forces and construct bridges across the Narrows and at Throgs Neck, double-deck the George Washington span, and with state and federal highway funds go forward with a range of related highway projects, at a total cost of $600 million. In this version of the story, which I find more plausible, the “Moses program” was primarily shaped by the Port Authority’s planners, and Moses and his aides helped to fill in the details, as the two agencies worked together closely throughout 1954.13 During the joint study, the two agencies turned again to their favorite bridge engineer, Othmar Ammann. In the 1920s and 1930s he had had primary responsibility for constructing all the Port Authority’s bridges and the Lincoln Tunnel; and, on loan to Triborough in the 1930s, he was also the chief engineer for the Bronx-Whitestone and Triborough spans. Since leaving the Port Authority in 1939, Ammann had worked on bridge and highway projects as partner in Ammann & Whitney. He now returned to the site of his early triumphs and took charge of the design and construction of all the new bridge projects—the second deck of the George Washington Bridge, the Throgs Neck span, and the Verrazano-Narrows Bridge. All three were completed by 1964, a year before Ammann died, at the age of 86. The arterial program had a modest impact in reducing traffic congestion in the region; but its influence in promoting suburban growth was more significant—especially on Staten Island, which would for the first time have direct vehicular access to Brooklyn and Long Island. Once the two agencies announced that the Narrows Bridge would be part of the joint program, land values and population on the Island began to increase, and they soared in the 1960s and 1970s.14 Rail Transit: an Unloved Visitor Who Would Not Leave In two other important project areas—commuter transit and the World Trade Center— the Port Authority’s efforts proceeded in a series of intertwined steps that revealed important weaknesses as well as continued strengths in the agency’s strategic arsenal. This complex tale began in the late 1940s, when Tobin and his staff explored the possibility of constructing a new rail line to serve commuters and other passengers along the New Jersey shore, op-

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posite Manhattan; the line might also have been extended to Newark Airport. Preliminary studies showed that the transit line would generate continuing deficits, and the Port Authority proceeded no further, adhering to its guideline that it should undertake a project only if it would be selfsupporting in the long run.15 By the early 1950s, however, the Port agency’s coffers brimmed with auto and truck tolls, while suburban rail lines faded financially; and now commuter groups and local elected officials began to target the Port Authority as both a cause of the transit problem and as a solution—particularly if it would transfer a substantial share of its “profits” to the needy rail lines.16 In responding to the public demand for action, Tobin and his aides showed elements of the strategic skill displayed in the earlier airport and bus-terminal battles: They encouraged the creation of a bi-state commission that could study the transit problem; and then they provided most of its funds, but only after the commission agreed to give the Port Authority an important role in shaping the studies. As a result, its officials were able to ensure that the reports would not propose that the Port Authority have a major role in financing the commuter rail system. Instead, the 1957 and 1958 commission reports recommended that the citizens of the 17 counties in the study area form a transit district and tax themselves in order to subsidize and improve the commuter rail system. Unfortunately for Tobin and his colleagues, that stratagem was unsuccessful. New Jersey’s state legislature rejected the tax district, and critics of the Port agency introduced a bill that would direct the Port Authority itself to “develop, improve and coordinate” rail passenger operations in the bi-state region. Testifying at a hearing in Trenton in November 1958, Tobin argued that his agency did not have the funds to take on that large task, and in a desperate plea for absolution, he concluded, “I think the Port Authority has done everything that it can to help try to find a solution. . . . We have nothing more to contribute to this problem.”17 Traditionally, the state’s governors had accepted the Port Authority’s position that it should not throw its energies and cash into rail transit. By 1958, however, several of the commuter railroads were heading toward bankruptcy, and the states were under pressure to find a way to save commuter service. In the fall of 1958, Nelson Rockefeller was elected governor of New York, after campaigning on a pledge to take action to meet the commuter crisis; and with service on the New Jersey rail lines deteriorating, its governor, Robert Meyner, also began to look for ways to use surpluses from road-building authorities to help underwrite rail transit deficits. Since the

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governors could use the veto power to force the Port Authority to allocate resources to the rail crisis, the agency now faced a far more credible threat than it had in recent decades.18 Meanwhile, the Port Authority’s yearly reserves had been growing at an alarming rate—alarming because large surpluses would make the agency especially vulnerable to demands that its “excess” funds be siphoned off to pay for rail commuter service. In 1956, the agency’s reserves had totaled $37 million; by 1958 they had reached more than $64 million; in 1960 they would be nearly $80 million. As those totals continued to rise, the pressures to use its funds to meet rail deficits might become overwhelming; and, once the agency’s revenues were directed toward the “bottomless pit” of rail transit deficits, would there be anything left for new projects in other areas, where the Port agency could see greater benefits for itself and for the region? One might reasonably wonder. In 1958 those rail deficits probably totaled more than $140 million a year, and to saddle the Port Authority with substantial portions of that total was a gloomy prospect.19 With this rail-transit cloud overhead, what could the Port Authority do? There were at least two possible lines of response. First, Tobin and his aides could have drawn upon their experience in the 1930s, when they had constructed an alliance to meet FDR’s challenge on tax-exempt bonds, and in the 1940s, when they had built a coalition which could ensure adequate financing for airport modernization and operation. From this perspective, they might have sought to persuade state officials to join in a wide-ranging coalition to maintain the region’s rail service—offering to use some Port Authority moneys, with restrictions so the agency could still act energetically in other areas, if the governors also agreed to use substantial state and local tax funds. Prospects for success of such a joint venture were uncertain—but in its battles against FDR, and against the airlines in the 1940s, the Port Authority had also faced large odds.20 Alternatively, Tobin and his aides could seek new projects outside the rail-transit area—projects large enough that they might absorb a major portion of those surpluses, thus undercutting the argument that the states could rely on the Port agency’s funds to solve the rail problem. Embracing this option, they directed their energies to two projects that were likely to absorb the agency’s growing revenues, and that were also viewed as beneficial to the region’s economy—a world trade center in New York, and an immense new airport in New Jersey. In the paragraphs below, both developments are summarized. I begin with the trade center, which soon became intermeshed with the rail issue.

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A Trade Center in Manhattan? By 1950, Roger Gilman and his port commerce staff had become concerned about the increasing efforts in New Orleans, Miami, and other cities close to Latin America to divert trade from the New York region. In response, the Port agency had opened its first overseas trade office in 1951, in Rio de Janeiro. New Orleans had already constructed a “world trade center” with exhibition space and other services, and in 1956 Gilman sent a proposal to Tobin, suggesting that a similar center might be useful in New York. Tobin and Gilman were heavily occupied in the arterial studies and other projects, and the issue was set aside.21 In 1957–58, however, David Rockefeller and other business leaders in lower Manhattan began exploring ways to revitalize the downtown area; and in their first report, in the fall of 1958, they recommended redevelopment of the East River section below Brooklyn Bridge, to include housing for workers in the Wall Street area plus an expansion of the financial district. The business group conferred with the Port Authority in the course of completing its 1958 report, but those discussions focused on the location for a downtown heliport.22 Within a few months, however, consultations with Roger Gilman and other Port Authority staff members had led the business coalition to modify its plans. The housing component was eliminated, and the expansion of the financial district was now described in informal discussions as a “World Trade and Financial Center.” Port Authority officials thought it might be able to play some role in this development, but its General Counsel warned that under the 1921 Compact, the agency’s contribution must be “closely tailored to the concept of the trade and promotion function” and that it must “exclude from our responsibility the acquisition of property, the financing and construction of facilities such as the Office Building and the Finance Building.” By January 1960, the business leaders were fully committed to advocating a World Trade Center and, through their Downtown-Lower Manhattan Association, they publicly expressed their hope that the Port Authority would study the planning and financing of this project. The Authority promptly complied, and its report, completed in March 1961, concluded that a Trade Center would offer “greatly improved coordination” of world trade activities, and that it would achieve “an annual break-even position” five years after beginning operations; however, the Center’s surpluses would be so marginal that the project could be undertaken “only by a public agency.” The trade center would be located on the East Side below Brooklyn Bridge, and it would include several buildings, the tallest 72 stories and another of 30 stories, with

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large areas for the display of goods in international trade. The total cost would be $355 million. As to which public agency should undertake this important project, the report was silent.23 . . . And a Breakthrough on Commuter Transit Even as the Port Authority took the first steps toward committing its reserves to a world trade center (and to a giant jetport, as described below), it faced increased pressure on the commuter railroad issue. In April 1960, New Jersey’s transportation commissioner proposed that the Authority purchase 90 rail cars and lease them to the Hudson and Manhattan Railroad (the H&M), an important rail line that carried more than 140,000 commuters a day from Newark, Jersey City, and Hoboken to Manhattan. Since the proposal would have required the Port Authority to use its own reserves for rail projects, and since it contained no restriction on future use of the agency’s funds for other rail projects, Tobin and his aides were alarmed. Rather than resisting the proposal in his usual absolute terms, however, Tobin asked his most creative legislative bill drafter, Daniel Goldberg, if he could find a way to respond to the state’s need for help at the H&M, while protecting the Port Authority so that all its reserves would not be at risk. Within a few months, Goldberg had met that challenge, and Tobin and the Port commissioners had endorsed his strategy. In September 1960, Tobin announced to a surprised group of legislators in Trenton that his agency was prepared to abandon its historical opposition to applying its own funds to the rail problem—if certain conditions were met. The Authority would purchase the H&M Railroad if the two states would agree, via restrictions (or “covenants”) in bondholder agreements, that the agency would not become enmeshed in other large-scale rail programs. After further negotiations, New Jersey state officials agreed to the kind of permanent restriction the Port agency proposed.24 A Combined Solution At this point, in the spring of 1961, the differing priorities of the two states emerged sharply. New Jersey’s legislators wanted the Port Authority to take over the H&M, which was in bankruptcy and might otherwise shut down; but they were not enthusiastic about the trade center, which appeared to be an immense real estate project to add office space in Manhattan. New York’s political leaders were willing to approve the H&M project, but their stronger interest was in the Trade Center, with its possible impact in generating wider reinvestment in lower Manhattan. Not surprisingly, Rockefeller and his legislative leaders thought the Port Authority was

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the best agency for the Trade Center project; and the “world trade” theme was used to justify its central role, thus overcoming the concern of the agency’s counsel, in 1959, that such a large real-estate project might violate the principles of the 1921 Port Compact. To protect their priorities, Albany leaders combined both the H&M and the Trade Center project in a single bill, and the bill was passed and signed by Governor Rockefeller on April 6, 1961. To New Jersey legislators, however, with their traditional wariness of New York’s economic and political power, this effort to prevent them from weighing the trade center as a separate (and perhaps dubious) enterprise was as a red flag to a bull. Several months of recriminations and inaction followed. Then, in the fall of 1961, a planner in the Port agency suggested that the Trade Center be shifted from the east side of Manhattan to the west side, near the Hudson River; then it could be combined with the rehabilitation of the H&M, which already had its major downtown station and two office buildings in that area. The proposed location would provide much better access for workers and visitors, since the west side was better served by New York’s subway lines as well as the H&M. With the two projects linked together, and the trade center now close to their own shores, New Jersey’s legislators accepted the new plan; and in the spring of 1962, the two states enacted legislation permitting the Port agency to proceed both with the trade center and with the purchase and rehabilitation of the H&M. The modernized commuter line would be called the Port Authority Trans-Hudson Corporation, or PATH.25 Into the Sky Now Tobin and his trade-center planners broke free from the business-leaders’ modest expectations and sharply recast the building plans. In 1964 Tobin and the commissioners unveiled an entirely new design, which featured “twin towers of gleaming metal, soaring 110 stories,” displacing the Empire State Building as the world’s tallest skyscraper. The initial response was largely favorable, with the New York Times exclaiming, “No project has ever been more promising for New York.”26 The extraordinary structures were endorsed by the two governors, though in fact Rockefeller was taken aback when he first learned of their size.27 However, several key staff members were concerned that the expanded plans for the trade center had no clear linkage to the issue of improving the New York region’s position in international trade, and that the great size of the structure would expose the Port Authority unnecessarily to political attack.28 As planning for the giant project went forward, there was increasing public attention to its cost. By 1966, the price tag had risen from $355 million to $575 million, and the New York Times expressed concern that the trade cen-

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ter would divert the resources of the Port Authority from other important issues such as rail transit. A few months later, the Times joined the chorus of harsher critics, arguing that the project was “enormously expensive and grandiose” and that it should be cut down to “realistic and efficient size.” Otherwise, the Times warned, the trade center would only be a monument to “the city’s former glories as a port and to the Authority’s audacious ability to get its own way.” But Tobin and his aides turned a deaf ear to these complaints, and the World Trade Center went forward, its costs rising year by year until they exceeded one billion dollars.29 A Solution to the Air Traffic Problem? During 1957–58, aviation department director John Wiley and his staff concluded that burgeoning air traffic would soon exceed the capacity of the region’s three major airfields, and a task force was created to examine the problem. By the fall of 1959, the working group had identified a solution which was soon embraced by Tobin and the Port Authority board, and then made public: an great new airport— 10,000 acres in size, twice as large as Idlewild (Kennedy Airport)—would be built in the Great Swamp area of northern New Jersey. This project would also absorb a sizeable portion of the agency’s growing surplus. Governor Meyner endorsed the plan, and Tobin and his aides then turned to the problem of gaining support from the region’s business leaders and major newspapers, in order to neutralize the opposition that might be expected from local residents in the Great Swamp area of Morris County.30 During 1960–61, opposition to the jetport proposal arose, but that was not surprising. Tobin and his associates were used to battling critics of their new plans. What was surprising here was that Tobin and his aides failed to comprehend the range and depth of resistance and that—as they took steps to “neutralize the opposition”—they misplayed some of their hands. In previous decades, major Port Authority projects had been compatible with widely held public values—for example, the view that better airports and more highway facilities were essential in order to reduce congestion and improve the efficiency of commerce and individual travel; or the argument that large investments in marine terminals were desirable not only because of the jobs directly created but more broadly because of their positive impact on the regional economy. These projects would garner support from those who took a “wide” view of the region—prominent business and civic leaders, the New York Times and other major newspapers, most state legislative leaders, and, most important, the two governors. The pockets of opposition that arose could be viewed as narrowly self-interested and parochial, and they

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usually were defined in those terms by the region’s newspapers and civic groups; and then they were politically marginalized and defeated.31 The opposition to the new airport was different. Many of those who objected to a massive new jetport in the Great Swamp in Morris County were local residents, and no doubt they were as parochial as the residents in the path of the Manhattan Bus Terminal. But some of them were wealthy and highly influential politically; prominent among the opponents was Congressman Peter Frelinghuysen, whose estate would be graced with a jetport runway. And they were soon joined by others, who, as part of the new wave of environmentalism, objected to destroying the wildlife and wildflowers of the marshlands. Moreover, the Port Authority was more exposed as it began the Battle of the Great Swamp than it generally had been, for it had failed to follow its traditional rule. Rather than asking civic leaders or elected officials to take the lead, the Authority itself had cast the first stone, opening the public debate by proclaiming that a gigantic new airport was needed and that there was no place for it except in the middle of New Jersey’s Great Swamp. The Unbending Leader Frelinghuysen and his fellow New Jersey members of Congress soon opened another, broader line of attack, urging Congressman Emanuel Celler of Brooklyn, the powerful head of the House Judiciary Committee, to undertake a general investigation of the Port Authority. As noted in Chapter 13, Celler had previously sought contracts from the bi-state agency for his law-firm clients and had been rebuffed, and he responded with alacrity to the suggested inquiry. In the spring of 1960 Celler launched a probe into the Authority’s policies and integrity, and he demanded that Tobin open all the agency’s files to his investigators. When Tobin protested that the Port Authority was a state agency, whose internal files should not be subjected to close federal control, and, with the governors’ support, refused Celler’s demands, Celler asked the House to cite Tobin for contempt. Tobin was indicted in August 1960, and in June 1961 a federal judge found him guilty of criminal contempt of Congress.32 That verdict was overturned on appeal in 1962, vindicating Tobin in his refusal to permit Celler to roam through the Port Authority’s files. However, the effort to grapple with the House investigation absorbed a vast amount of Tobin’s time and energy—and the sustained attention of several of his best people—in 1960, 1961, and 1962. As a result, less attention and creative energy were available to monitor and assess the possible impact of a set of new values beginning to sweep across America—the environmental movement; the increasing resistance to large development projects with their traumatic

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impact on local communities; and the effort to nourish “community control” as a central political value in suburban towns and larger cities.33 Moreover, the Celler probe had other, more direct effects. Celler’s aides publicized several cases in which Tobin and his aides appeared to have used bank-deposit accounts and insurance contracts to curry favor with state legislators; and the investigators located one staff member who had obtained payoffs in connection with Authority contracts.34 So the Port Authority’s nonpolitical image was challenged in an effective if limited way. Moreover, the Celler hearings conveyed the impression—to some members of his committee, as they heard Tobin stubbornly refuse to open his files, and to others outside the hearing room—that the Port Authority was efficient, immensely knowledgeable on issues of law and project development, and arrogant. Arrogance always was—always is—a danger for the Port Authority. The agency could offer higher salaries to the top college graduates than could New York City government or the best state agencies, and it “got things done”; so for those interested in public service, the Port Authority had long been a premier employer. Yet in planning and carrying out complex projects, this large and able staff had seemed to some observers too insulated, too unwilling to respond to the concerns of those who questioned its programs and policies. And now Austin Tobin, unyielding and combative, had stood before the Judiciary Committee and said he had no regrets and that he still supported all the programs and policies that his agency had pursued over the years. In that battle, he won, in the courts. But Tobin’s public stubbornness, and the agency’s recurring advocacy of immense projects, reinforced the theme of arrogance. The continuing jetport saga underscored the point. Despite widespread local opposition throughout 1960, and a 20–1 vote in the New Jersey state senate that year against the Great Swamp site, Tobin and his aides continued to defend this location as the only feasible one. The agency’s next report, in May 1961, reaffirmed that position and concluded that all other possible locations—16 were studied—were unsuitable. The local coalition then sought to block the Authority permanently by appealing to Washington to protect the site, and their political efforts met with success, as federal officials declared the Great Swamp a national wildlife refuge in 1964, and a national landmark in 1966. By then, several large airlines had decided to make public their doubts that a new airport was needed, a concern shared by some of the Port Authority’s own experts.35 Yet Tobin responded by issuing another report at the end of 1966 which declared again that a gigantic jetport was needed, and that the Great Swamp

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was the best, indeed the only, place to construct it. To residents of New Jersey and other observers, the entire seven-year battle suggested that Tobin and his agency were strikingly insensitive to local concerns and to political reality. This was a jetport that would never, at least in the twentieth century, be built. By the late 1960s, Tobin and his associates had spent a decade advocating several large projects which had generated vigorous opposition, and these battles left a legacy of wariness and ill feeling among some of the agency’s supporters as well as its long-standing critics. And while the critics may at times have been unfair in their allegations, perhaps they touched on a basic problem. In a tradition now decades old, the Port Authority’s leaders responded to complex challenges by seeking large-scale, dramatic solutions, solutions that would reach beyond the immediate problem and meet the needs of the next generation. In seeking to “make no little plans,” Tobin had gathered around him planners and specialists in all fields who shared this general perspective, and together they had created the largest bus and truck terminals in the world, developed three of the busiest airports in the nation, and reached out with massive investments to expand the region’s highway system and to lead the “containership revolution.” And with few exceptions, this approach had been strikingly successful. By the 1960s, it was difficult for men and women reared on this rich diet to look with skepticism at great new plans, and to gather and understand evidence that sometimes might suggest that smaller could be better—in political, in social, and even in economic terms. As Machiavelli argued, “One who has prospered by following one kind of policy will not be persuaded to abandon it.”36 Final Conflicts of the Tobin Era For a short while, the good will generated by the PATH modernization effort seemed to balance the pockets of opposition to the Port Authority’s less happy adventures. Moreover, Tobin had managed to keep a staff of real ability and to maintain high morale during the difficult years of the Celler inquiry and the Great Swamp foray—and despite doubts among his aides as to the wisdom of the jetport plan and the Trade Center’s dimensions. During the 1960s, Tobin also led an important and successful challenge to racial discrimination in the construction trades.37 Quite possibly he and the Authority could have gone forward to new initiatives and new accomplishments in the 1970s, were it not for two developments. The first was the growing cost of rehabilitating and operating the PATH system. The Port Authority staff directed their energies toward reviving that ancient line with as much vigor as they had employed in modernizing La-

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Guardia Airport and Port Newark. The rail tracks, stations, and lighting were improved and the entire fleet was replaced with 250 air-conditioned cars; by 1969 the cost of this revitalization was more than $175 million. The changes attracted more patrons, but in paying for the capital costs and operating the railroad, the Port agency placed an increasing burden on its surpluses. In 1968 the PATH deficit had reached $11 million, largely absorbing all the funds available to meet rail needs under the bond covenants. Once again, commuter groups and suburban officials in northern New Jersey began to criticize the Authority for its limited contribution to solving the transit problem.38 The second event was the election of William Cahill as governor of New Jersey in the fall of 1969.39 Cahill had been a member of Congress from the southern part of the state, and when he decided to run for the state’s highest office, he focused his attention on the more populous northern counties, where he was less known. As he campaigned in Morris, Essex, and Bergen counties in the summer of 1969, he found that crowds responded enthusiastically when he attacked the Port Authority—for its jetport plans and its trade center towers, for its limited efforts to solve the rail problem, and for its alleged insulation and disdain toward the concerns of local communities. Cahill’s gubernatorial victory brought together several major strands of conflict that Tobin and his allies had faced during the previous ten years. Responding to public sentiment as he sampled it during his campaign, Cahill entered office firmly opposed to a major new airport anywhere in northern New Jersey; and he was equally certain that Tobin and his agency must throw their energies and their reserves more fully into the battle to save rail commutation. Moreover, Cahill was doubtful that vast sums should be used from the Authority’s treasury to construct a complex of office buildings in Manhattan, especially while the New Jersey rail crisis needed its attention and money. And finally and unluckily, William Cahill was not only a former member of Congress; he had also been a member of the House Judiciary Committee, and in 1960 he had been a member of the subcommittee through which Emanuel Celler had investigated the Port Authority. One of the votes to cite Tobin for contempt of Congress had been cast by Cahill, and neither he nor Tobin could forget that division. So when Cahill took office in January 1970, two stubborn Irishmen, with a history of conflict on matters both of policy and prerogative, squared off. In his first months in office, Cahill pressed Tobin to undertake further rail studies and to find a way to devote more Authority funds to rehabilitating and extending the region’s rail system; but Tobin resisted, arguing that with the

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large PATH deficits, the bond covenant of 1962 barred the agency from additional rail operations. Then, meeting with Cahill and his aides to review the Port Authority’s other activities, Tobin mentioned that the agency was planning to add a hotel to the Trade Center complex. The governor was outraged at Tobin’s willingness to throw more funds into what he saw as a dubious “commercial enterprise,” while resisting action on the commuter rail problem. Cahill then barred Tobin from meetings on rail issues, though he called in Tobin’s subordinates, and he pressed the New Jersey commissioners on the Authority board to gather support from their New York counterparts and reverse Tobin’s policies in the rail field.40 Meanwhile, New York’s governor, Nelson Rockefeller, had appointed his chief transit aide, William Ronan, to the Port Authority board in 1967, and beginning in 1970 Ronan joined some of the New Jersey commissioners in challenging Tobin and his policies, both during and between board meetings. By early 1971, the sense of mutual regard and unified support from the commissioners which Tobin had experienced since Frank Ferguson stalked out in 1945 had broken down. Tobin and his views still commanded a majority on the board, but there seemed to be continual, often carping, criticism. Moreover, he could no longer expect active support from the two governors for new programs and other innovations, and Cahill had begun to attack him publicly.41 By the Fall of 1971, the job was more a burden than a series of challenging opportunities. Finally, he felt he had had enough, and on December 12, Tobin telephoned his top aides and then announced he was leaving, immediately turning over the reins of office to his deputy and formally retiring in March 1972. Now 68 years of age, Tobin soon joined an executive service corps and spent the next several years advising governments in Israel and other lands on port development and management strategies. In the mid-1970s, he declined an invitation to attend the dedication ceremonies for the World Trade Center, but in 1977, ill from cancer, he went by taxi from his Manhattan apartment to the Trade Center, stepped out on the plaza, and looked up admiringly at the twin towers, now complete, rising far above and symbolizing the aggressiveness and the dominance of the New York region in worldly matters, an attitude and a position for which Tobin had fought during his 45 years at the Port Authority. On February 8, 1978, Austin Tobin died in his Manhattan apartment, of cancer. In 1982 the plaza area, a summer place for noontime crowds and playful concerts, was named the Austin J. Tobin Plaza.

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1972–2000: Drift, Political Incursions, and a Search for New Missions The Port Authority’s experience during the past quarter century and more can be captured in terms of a few themes—drift, patronage and favoritism, and the search for new goals. The agency has experienced some periods of drift, when vulnerability to patronage and other short-term political demands has been high, and then spurts of vigorous leadership, which its staff and friends have hoped would lead to greater things. Ideally, as the Regional Plan Association and other observers have suggested, the Authority might in the new century occupy the important role in economic growth for the bi-state region that it held during the Cohen and Ammann years and through much of the Tobin era. But this will require changes in attitude at Trenton and Albany, and coalition-building strengths not easily obtained in this era of negative political rhetoric and distrust of government. Some further observations on the Port Authority’s future follow, at the end of this section. First, however, a compressed review of the years since Austin Tobin departed, in anger and frustration. The 1970s Malaise With Tobin gone, the two governors hoped to divert large amounts of Port Authority funds to rail-transit needs. Within a few months they had succeeded in persuading the agency’s commissioners to allot more than $250 million of Authority moneys for two rail projects—to extend the PATH system to Newark Airport and then into Union County to the west; and to connect Kennedy Airport to Manhattan by rail. Cahill also took aim at the agency’s title, The Port of New York Authority, as suggesting that New Jersey was not an equal partner, and in 1972, the name was changed to The Port Authority of New York and New Jersey. And he demanded that the states repeal the 1962 bond covenant, so the agency’s rail activities would no longer be limited by the 10 percent rule.42 Rockefeller had worked in moderate harmony with Tobin and his aides during the previous decade, but he now found the hostile stance of his fellow Republican governor to be contagious. “We don’t want a continuation of the Tobin structure,” he asserted, “which as everyone knows was a very tight, political structure and opposed to mass transit.” Rockefeller urged that William Ronan, who served the governor as head of New York State’s Metropolitan Transportation Authority, be appointed to Tobin’s old job so that he could lead the Port Authority “from a rubber to a rails orientation.”43

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During the next year, the governors could not agree on who should replace Tobin; and then both suddenly departed—Cahill defeated in his bid for re-election in 1973, and Rockefeller to serve as Vice President in Washington, under Gerald Ford. However, their successors, Brendan Byrne at Trenton and Malcolm Wilson in Albany, pressed ahead with the campaign to draw the Port Authority more deeply into rail transit. In 1974 both states repealed the 1962 bond covenant retroactively; Port Authority bridge and tunnel tolls were then raised sharply to help pay for the expanded rail activities; and the governors looked forward to being able to rely on the bi-state agency for an increasing array of mass transit projects. Unfortunately, their hopes were tied to a dubious legality, and in 1977 the Supreme Court concluded that the repealer violated the obligations-of-contract clause of the U.S. Constitution. With the PATH deficit at $37 million in 1975 and still rising, and with the covenant in force, almost no Port Authority funds would be available for other rail activities in the foreseeable future. The rail projects announced with fanfare in the early 1970s would have to be financed in some other way.44 The long battle to increase the Authority’s role in rail transit which Governor Cahill ignited in 1969 had other results, beyond encouraging the chimera that the region’s mass-transit problems would soon be solved. For nearly thirty years, a sense of institutional purpose, effective leadership, and strong staff morale had been crucially linked to Austin Tobin’s energy and his intensive engagement with all major issues, and to staff expectations that he would make funds available to permit them to devise and carry out ambitious programs. As Tobin’s energies had become absorbed in the struggle with Cahill, the separate enterprises—airports, world trade, marine terminals— began to drift apart; and once Tobin left, some staff members worked less for the institution and more for their own units in isolation, and for themselves. The change in attitudes and behavior was uneven: in some areas, a lively interest in the future and in the agency’s wider purposes remained. But in department after department, a sense of forward motion disappeared, the focus turned inward, and staff morale fell.45 If Austin Tobin had been succeeded by an executive who had deep experience in leading a complex enterprise, this weakening of the fabric of the institution might have been less severe. However, unless the governors were willing to install a strong executive and give that leader an opportunity to identify new missions and act to achieve them, a decline in staff morale and energy would seem inevitable. But the governors and the Port Authority’s commissioners could not agree on who should lead the agency, and so the agency drifted. When Tobin departed, his deputy, Matthias Lukens, took

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over; he was designated as “acting” while the governors and the commissioners tried to reach agreement on a permanent executive. Lukens retired in the fall of 1973, and the agency’s director of finance, Gerdes Kuhbach, was recruited to take his place, also as “acting” head of the agency; and in 1974 the board agreed to install him as executive director, a post which he held, with little independent discretion, for the next three years. Had Rockefeller’s first choice to succeed Tobin—William Ronan—been accepted by Governor Cahill and the New Jersey board members in 1972, power might again have flowed into the staff director’s office. But Ronan was too deeply involved in deficit transit operations in New York to win wide support from the commissioners, many of whom shared Tobin’s fear that rail projects might drain the Port Authority’s funds, leaving it as only an efficient housekeeper of existing bridges, tunnels, and airports and docks. They had seen this result, courtesy of Rockefeller and Ronan, at Robert Moses’ once vigorous Triborough Authority; that chilling prospect for their bi-state agency could not win the hearts of commissioners or staff who had been nourished by Tobin’s entrepreneurial energy.46 In 1974, with strong pressure from Rockefeller, Ronan was elected by his fellow commissioners to chair the Port Authority board. He attempted to use that position to lead the agency, supplanting the executive director’s role, but his tendency to comment disparagingly about his fellow board members and a sometimes arrogant style undercut his efforts. By the end of the year, New Jersey’s Governor Byrne was chastising Ronan for failing to make progress on rail transit projects, while his colleagues on the board were openly in distress. “Nothing is getting done,” one commissioner admitted to a New York Times reporter, who concluded after two years of following the agency in its downward spiral that the Authority was “dead in the water.” His plaint was an echo of Erwin Bard’s judgment on the agency thirty years earlier, as Tobin was about to assume power.47 In reality, some things did get done in the early 1970s. More than a million square feet of cargo space was added at Kennedy Airport, enhancing that terminal’s position as a major employment center in Queens. In 1975, the Journal Square Transportation Center, an integrated terminal for PATH trains and buses, was opened in Jersey City. And in 1975–76 a major expansion of the Manhattan bus terminal was underway. But the absence of central leadership was a sharp contrast with the Tobin years.48 Goldmark Expands the Agency’s Mission The internal tension on the Port Authority board faded somewhat, once the Supreme Court had reaf-

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firmed the validity of the 1962 bond covenant in April 1977; and the governors soon agreed that the agency needed new leadership. In June, Ronan was replaced as chairman by Alan Sagner, a New Jersey commissioner who had been an effective head of the state’s transportation agency. At the same time the Authority board named Peter Goldmark, a top official under New York’s governor, Hugh Carey (1975–82), to be executive director. Goldmark was a highly regarded executive with government experience in New York City, in Massachusetts, and at Albany, where, as the state’s budget director, he had been a key player in grappling with the New York City fiscal crisis. His selection, in the summer of 1977, suggested that power would flow to the senior staff position, and the Goldmark-Sagner team soon returned some degree of harmony to the Port Authority board. The key issue Goldmark faced was this: What should be the primary goals of the Port Authority? This was the same question Austin Tobin had confronted in his first years as executive director, and in 1942–43 he had gathered a small staff to explore the range of possibilities and to set priorities for action. Drawing from that survey, as we saw in chapter 11, Tobin and his aides had identified the airports and the region’s marine terminals as primary targets for the agency’s expansion. In 1977–78, Goldmark used a similar strategy, creating a Committee on the Future which could examine the wide range of areas in which the agency might focus its funds and energies. To Goldmark, the main attraction of a position at the Authority was the agency’s potential to strengthen the economy of New York City and its wider region. Crucial in this effort, he thought, would be to reverse the loss of manufacturing jobs in the older cities. He also realized that the Port Authority had developed a reputation, in the later years of the Tobin era, of acting too independently, rather than cooperatively with local communities; Tobin’s jetport foray was a dramatic illustration of this theme. Goldmark expected that the Committee on the Future might find ways to meet these several concerns.49 Out of the work of that committee came a set of proposals which might give the Port agency a new sense of mission, and a basis for working collaboratively with local leaders. The most prominent was a plan to create industrial parks in several older cities, together with active efforts to attract manufacturing firms to come into the region and locate in the identified areas. As this set of proposals evolved in 1978–81, the plan included industrial parks in the Bronx (at Bathgate Avenue), in Elizabeth (near the Elizabeth marine terminal), and on Staten Island. In addition, the Port Authority would develop a plant in Essex County where waste could be incinerated and electricity

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generated, a commercial fishing complex (or fishport) in Brooklyn, and a satellite communications center (teleport) on Staten Island. To Goldmark and his supporters, this expansion of the agency’s role—to focus on strengthening manufacturing in the region and providing more efficient energy and better satellite communication—could readily be justified, since they would contribute to the economic vitality of the bi-state region and were ventures that private entrepreneurs were not likely to undertake. To some staff members and observers, however, the new projects fell outside the Port Authority’s proper domain—transportation—thus diverting its energies from core tasks, and the likelihood that industrial parks and the other new projects would contribute significantly to improving the regional economy seemed highly doubtful.50 By the time that Goldmark left the Port Authority in 1985, several of these initiatives were well advanced. Bathgate Industrial Park in the South Bronx employed more than 1,000 workers in its manufacturing plants, and several hundred worked at the Elizabeth park. Plans for the third industrial area had been shifted from Staten Island to Yonkers, in Westchester County, and by 1985 that park employed more than 500 workers in a dozen plants. The Essex waste disposal facility had not yet been started, but regulatory approval was expected soon; and the Teleport on Staten Island was in operation. Some staff members expressed a concern that Goldmark had placed so much emphasis on these new activities that not enough focus or funds had been directed to maintaining the existing facilities. There was little doubt, however, that the morale of the agency’s staff, and the agency’s reputation among political leaders and in the wider community were stronger in the mid-1980s than they had been in the early 1970s.51 Returning to “Basics”: Renovations and Belt-tightening In 1986, the Board named Stephen Berger to be executive director. Berger, an expert on financial issues, had worked in New York City government during the 1970s fiscal crisis, and he had also been an official of the Metropolitan Transportation Authority, which was responsible for mass transit on the New York side of the bi-state region. With Goldmark’s economic-development initiatives underway, Berger directed his main attention to the existing plant in a campaign he titled, “back to basics.” During the next four years, Berger directed staff energies and funds to an array of unglamorous but crucial renovations and improvements. The entire ceiling of the Holland Tunnel’s south tube was replaced; PATH’s ventilation system was upgraded and a new transit-car repair shop was constructed to replace one in use since 1910; and the Outerbridge

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Crossing roadway was refurbished. In addition, the central terminal at LaGuardia Airport was expanded; additional escalators to PATH trains were constructed at the World Trade Center; and automated bus-schedule information was put on-line for passengers at the Bus Terminal in Manhattan. Perhaps the most distinctive additions to the Port Authority’s domain during Berger’s years were a new office building, completed in 1989, and a trans-Hudson ferry route. The building, called the Newark Legal Center, was undertaken by the Port Authority staff reluctantly, as a result of sustained pressure from New Jersey’s governor Thomas Kean (1982–90), who argued that it would help stimulate economic growth in downtown Newark. Since the 18-story building would house law firms and banks with no clear linkage to transportation or world trade, it sat as an illustration that Goldmark’s argument could be readily expanded to justify, at least politically, almost any project that had a plausible relationship to economic development in older cities. More positive, at least for those who think of transportation as the Port Authority’s central mission, was the opening of a ferry route across the Hudson, running from Hoboken to Battery Park City, near the World Trade Center. The service, begun in the fall of 1989, was provided by four 20-knot ferry boats, and carried travelers who would otherwise take the overcrowded PATH trip to and from Hoboken. Within a few months, the ferry service was attracting more than 4,000 passengers a day. It was the first trans-Hudson water service since the ferries operated by the commuter railroads had closed down in 1967.52 Berger was succeeded in 1990 by Stanley Brezenoff, who had extensive management experience in New York City government. Brezenoff opened his tenure by asserting that “the principal job” of the agency was to “move people and goods into and through the vast bi-state . . . region.” Working with the agency’s new chairman, Richard C. Leone, Brezenoff focused mainly, as had Berger, on rehabilitation efforts at the agency’s aging terminals, bridges, and tunnels. As Leone argued, “It’s a less romantic time. . . . In the past, your goals were usually built around some bold, important new project. . . . Most everything projected for the next 5 to 10 years is simply to keep everything running.”53 Yet they also explored possible new projects in the transportation field. One was a $380-million monorail to connect the terminals and parking lots at Newark Airport. A second was a rail connection between that airport and the New York-Trenton-Philadelphia railroad line; that project might cost $400 million or more. A third, which was far more expensive and complex,

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was a rail line through densely developed Queens; this rail project would connect Kennedy and LaGuardia airports with the Long Island Railroad and the New York City subway system, so that airline passengers could travel to and from the airport by rail, rather than enduring a ride on congested roadways that often, for Kennedy passengers, took more than two hours from Manhattan. Its estimated cost was $1.6 billion. And a fourth, which had a history that stretched back to the Port Authority’s origins, was a new rail line which would carry both passengers and freight between New York City and the New Jersey hinterland. The 1990s version would begin in Queens, with a tunnel under the East River to stations in Manhattan; it would then continue under the Hudson River, emerging in New Jersey, where it could connect with both the commuter transit lines and the nation’s freight railroad system. Another suggestion that seemed to deserve close study was a new bridge between New Jersey and Staten Island near the Goethals span, which was heavily congested during and beyond rush hours. In addition, led by Leone and Brezenoff, the senior staff gathered experts from outside as well as inside the agency and explored other possible initiatives that might aid regional growth, such as job-creating enterprises directly linked to the three large airports.54 The monorail at Newark Airport was approved, and within five years it was in operation. However, none of the other proposals was taken beyond the stage of preliminary planning during Brezenoff’s tenure. The main hurdles facing the proposals were two. First, the PATH deficit continued to increase and, despite pleas from the agency’s executives, New Jersey’s governors were unwilling to raise the fare; as New York’s subway fare was increased to $1.25 and then to $1.50, the threat of a veto from Trenton kept the PATH fare at $1.00, where it remained through 1999. As a result, by 1994 the PATH operation was drawing off more than $190 million a year from the agency’s coffers. Second, the strong regional economy seen in the Berger years had weakened by 1990; the recession cut into the Port Authority’s revenues and so reduced funds available for new activities. In the early 1990s, the agency was under sufficient financial pressure that it began to cut staff and limit expenses in “nonessential” areas, such as economic forecasting and regional planning. Even with these actions, the agency faced the prospect of an overall deficit each year. So belt-tightening would have to continue.55 Regional Tensions, the Governors, and Patronage Games The leadership at the Port Authority in these years was generally of high quality. Confronting an economy that had been slow to recover, and gubernatorial reluctance to

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permit the agency to raise fares and other fees, Brezenoff and his staff had reduced expenses, pressed ahead with modernization efforts at PATH and the airports, and begun to explore projects that, when the region’s economic strength permitted, might improve the efficiency of passenger and freight transport in this congested metropolis. There were, at the same time, some examples of management error; a highly visible one, due to press attention, was the expensive tunnel at Kennedy Airport, which absorbed millions of dollars even as it became clear that the underground facility was not needed.56 Most notably, perhaps, the Port Authority had continued to attract and hold able and dedicated staff at senior and middle levels—individuals in engineering, finance, planning, law, and administration who were among the best in public service and in the private sector. Their ability could be seen in the efficiency with which the marine terminals, airports, and other facilities were operated, and it was demonstrated more distinctly in the aftermath of the World Trade Center bombing of 1993—when the staff worked overtime and, through an immense effort, returned the damaged structure to reasonable operating levels within a few weeks.57 Moreover, in this era, as in the previous decades, the career staff continued to operate almost free from corruption or other scandals, even though opportunities for payoffs and other personal benefits were always present in an agency that awarded millions of dollars in contracts every year. There had been a few notable cases identified in the Celler inquiry, as well as two dozen in the leadership hiatus of the mid-1970s; but the Port agency avoided the recurrent patterns of serious corruption found in New York City and other government and private organizations in recent decades.58 However, in the metropolitan domain within which the Port Authority operated, interstate jealousy and antagonisms had sharpened in the 1980s and early 1990s. During those years, New Jersey officials offered tax concessions to businesses willing to move to New Jersey, and they were able to entice some corporate offices to migrate from Manhattan and Brooklyn. Moreover, the successful efforts to extract the New York Giants and the Jets from their traditional homes to play in New Jersey’s Meadowlands was a continual reminder to New York patriots that the smaller state could not be trusted to defer to the region’s dominant power. New Jersey’s 1993 suit, which claimed sovereign authority over much of Ellis Island, put salt into these wounds, and seemed to revive the kind of legal and political conflict seen nearly 80 years before—in the contest which had led to the creation of the Port Authority.59 Of course, the activities of the Port Authority itself had long been embedded in this interstate battling, and the shift of marine cargo from New York

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piers to New Jersey in the 1960s as part of the container revolution heightened the distrust of New Yorkers who viewed economic gains west of the Hudson as a grievous loss to their local interests. When Berger and then Brezenoff proposed that $90 million be spent to lengthen Newark runways, the New York commissioners balked, bowing to the arguments of New York City’s elected officials that the Port agency was neglecting Kennedy Airport and that traffic was wrongly being shifted to Newark’s air terminals. By 1994, Mayor Rudolph Giuliani was attacking the Port Authority’s alleged bias toward New Jersey on all fronts, and he urged that the agency be broken up, so that New York could take control of its own airports and its seaport destiny. The spirit of Mayor Hylan’s antagonism toward the agency, a spectre from the 1920s, seemed to have returned to City Hall in full force.60 More important, for the long run, was the shift in the attitude and behavior of the state’s two governors. Through the 1960s, they had almost invariably been strong supporters of the Port Authority as an exemplar of the best in Progressive values—an agency that used expertise and careful factfinding to identify regional needs and carry out complex programs, whose leaders planned with a long-range view, not in terms of short-term goals to benefit one city or one state. The governors from Al Smith and George Silzer to FDR and Driscoll, Dewey, Hughes, and Rockefeller had valued the agency, whose staff had the kind of integrity and competence they wished they could find in every state department, and whose executive director had extraordinary leadership ability and management skills. From time to time, the governors might challenge the agency’s decisions, as Dewey did in the airport conflict of the 1940s, or even try to press the staff to award an occasional contract to political favorites, as New Jersey’s Governor Moore did in the early 1930s. However, they almost always appointed commissioners with a reputation for independence, and they permitted the board to decide who would lead the agency; and they expected that the commissioners and senior staff together would use expertise and “businesslike methods” in identifying new programs and carrying them forward. The conflict between Cahill and Tobin, followed by Tobin’s departure and the years of uncertain staff leadership, broke the tradition of independence from the governors’ offices; and the political problems involved in setting the PATH fare in the 1970s and 1980s gave the governors an opening for greater involvement in how the Port Authority’s moneys would be raised and spent. Moreover, when Goldmark was selected from outside the staff by Governor Carey, rather than by the commissioners, staff leadership became a political post, though for the present to be filled based on proven leadership

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skills. Then Goldmark made what might be called a fatal decision: In advocating that the bi-state agency devise economic-development plans, in close collaboration with local communities, he signaled that political negotiations would sit at the table as an influential partner with the Authority’s experts, in identifying possible projects and how they would be selected and shaped. It was a short step for Byrne’s successor as governor, Thomas Kean, to press the Port Authority not only to build the Newark Legal Center, but also to persuade the agency to create a “Bank for Regional Development,” which might receive a portion of the agency’s surpluses. The bank would be controlled by appointees of the two governors, the moneys could be used for projects unrelated to the Port Authority’s own programs, and the projects would be chosen “in consultation with” local and county officials. In this way, a substantial chunk of the Port agency’s surpluses would be allotted to meet the governors’ perceived needs, whether to stimulate economic development in a creative way or simply to finance pork-barrel operations. By the end of 1994, more than $600 million in Port Authority revenues had been diverted to the bank and other “regional programs” outside the Port agency’s control.61 The erosion of the Port Authority’s independence in these several ways laid the groundwork for the disastrous decisions of 1995. With the Port agency facing difficult financial and policy issues as the year opened, it also confronted a new governor at Albany, George Pataki. To Pataki and his advisers, replacing the executive director offered an opportunity to gain control over an agency that he thought had been too independent of Albany interests. But that defensible goal was overwhelmed by the attraction of using the job to reward a crucial political supporter with a $170,000 annual salary. No one was more deserving, in Pataki’s view, than George Marlin, a bond salesman and a leader of the state’s Conservative Party, which had helped Pataki win the governorship. New Jersey’s governor, Christine Whitman, expressed some doubts that Marlin was qualified, and most of the commissioners were unhappy with his lack of experience. After a month’s delay, however, Whitman and a majority of the commissioners succumbed, and Marlin was named executive director in February 1995. Marlin soon forced most of the agency’s top career staff to leave, and he laid off hundreds of experienced workers. (“You had a brain drain there,” one of the commissioners commented to a reporter, “that I think would cripple any organization.”) Marlin imposed a hiring and contracting freeze, and it was then lifted selectively so that firms and individuals favored by Marlin and by state officials could be employed. Morale fell sharply, and Marlin soon ran into conflict with several board members over his management style and

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limited understanding of regional issues. In the early months of 1997 he was forced out.62 Marlin’s replacement was Robert Boyle, an old friend of George Pataki, who had served as chief executive at the Jacob Javits Convention Center in Manhattan, and who had a reputation as a good manager. He did not initially grasp the reins of leadership, however, and the agency continued to drift; and now the commissioners embraced patronage over merit and objectivity. In the summer of 1998, at Boyle’s urging, the board decided to give each commissioner special influence in selecting members of the Port Authority police force. When the plan was revealed by the Newark Star-Ledger, Governor Whitman criticized the patronage policy and it was withdrawn; but neither she nor Pataki seemed to care enough about the Port Authority’s reputation or staff morale to force out those who had advocated and endorsed the erosion of public integrity at the agency.63 Despite these missteps, and recurrent interstate conflict over the Port Authority’s airport and seaport plans, the staff continued to make some progress in the late 1990s. A massive expansion of Kennedy Airport and new rail connections to Newark and JFK airports were underway, and planning for improved rail links between Manhattan and the western counties continued. As the decade ended, however, disagreements between Governors Pataki and Whitman prevented the Port Authority from carrying out a dredging operation needed to strengthen the competitive position of the region’s marine terminals, as they faced continuing challenges from Halifax, Baltimore, and other ports.64 The Marlin and patronage fiascos and the Pataki-Whitman conflicts underscored the crucial role of the state’s governors in protecting—or undermining—the quality of planning and action at the Port Authority. Whether the bistate agency can again become the important engine of regional development that it was under Cohen, Ramsey and Tobin, and was poised to become in the early 1990s, is unclear. In order to resume that role, it would need to have more control over its revenues than the states have recently permitted; and the governors would have to be guided not by their patronage aides and their own short-term political concerns, but by advisers who combine an understanding of the dynamics of economic growth with an appreciation of the potential role of the Port Authority in encouraging regional development. They would need to return to the tradition of Governors Dewey and Driscoll, whose commissioners combined political independence with self-confidence, permitting them to choose strong staff executives and to shield the agency from patronage and from short-term political demands of the governors themselves. Then the

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commissioners and staff might be able to combine imaginative thinking about new projects and programs with an ability to act. As Woodrow Wilson suggested at the dawn of the Progressive age, the staff would need the flexibility to make choices and take risks, limited by the disciplined oversight of governors who are able, like Al Smith and Tom Dewey, to take the long view.65 Perhaps, as the Regional Plan Association has recently argued, the bistate agency should be shorn of many of its current functions so it can concentrate on airports and seaport issues; but that may be too radical surgery. The alternative proposal of New York City’s mayor, that the Port Authority be destroyed and its functions parcelled out to a new City Airport Authority and other agencies, is provocative, but likely to fail on political as well as economic-development grounds. It does carry a nostalgic air, reminding us of the long history of efforts, by New York’s elected leaders, to resist cooperation with its sister state. “Look here, Al, what’s the use of our fooling with New Jersey,” exclaimed Mayor John Hylan, in response to Governor Alfred E. Smith’s plea for regional action; “let us get up a Port Authority of our own. If you don’t want to go back to Albany, I’ll appoint you commissioner with a big salary.” The offspring of John Hylan, not the Progressivism of Al Smith and Charles Whitman, are in full voice as the bi-state region enters the new century.66

Appendix

Port Compact of 1921 1

Whereas, In the year eighteen hundred and thirty-four the states of New York and New Jersey did enter into an agreement fixing and determining the rights and obligations of the two states in and about the waters between the two states, especially in and about the bay of New York and the Hudson river; and Whereas, Since that time the commerce of the port of New York has greatly developed and increased and the territory in and around the port has become commercially one center or district; and Whereas, It is confidently believed that a better coordination of the terminal, transportation and other facilities of commerce in, about and through the port of New York, will result in great economies, benefiting the nation, as well as the states of New York and New Jersey; and Whereas, The future development of such terminal, transportation and other facilities of commerce will require the expenditure of large sums of money and the cordial co-operation of the states of New York and New Jersey in the encouragement of the investment of capital, and in the formulation and execution of the necessary physical plans; and Whereas, Such result can best be accomplished through the co-operation of the two states by and through a joint or common agency. Now, therefore, The said states of New Jersey and New York do supplement and amend the existing agreement of eighteen hundred and thirty-four in the following respects:

ARTICLE I. They agree to and pledge, each to the other, faithful co-operation in the future planning and development of the port of New York, holding in high trust for the benefit of the nation the special blessings and natural advantages thereof. 403

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ARTICLE II. To that end the two states do agree that there shall be created and they do hereby create a district to be known as the “Port of New York District” (for brevity hereinafter referred to as “The District”) which shall embrace the territory bounded and described as follows . . . . [See map, page 70 above.]

ARTICLE III. There is hereby created “The Port of New York Authority” (for brevity hereinafter referred to as the “Port Authority”), which shall be a body corporate and politic, having the powers and jurisdiction hereinafter enumerated, and such other and additional powers as shall be conferred upon it by the legislature of either state concurred in by the legislature of the other, or by acts of congress, as hereinafter provided.

ARTICLE IV [as amended, 1930].2 The port authority shall consist of twelve commissioners, six resident voters from the state of New York, at least four of whom shall be resident voters of the city of New York, and six resident voters from the state of New Jersey, at least four of whom shall be resident voters within the New Jersey portion of the district, the New York members to be chosen by the state of New York and the New Jersey members by the state of New Jersey in the manner and for the terms fixed and determined from time to time by the legislature of each state respectively, except as herein provided. Each commissioner may be removed or suspended from office as provided by the law of the state from which he shall be appointed.

ARTICLE V. The commissioners shall, for the purpose of doing business, constitute a board and may adopt suitable by-laws for its management.

ARTICLE VI. The port authority shall constitute a body, both corporate and politic, with full power and authority to purchase, construct, lease and/or operate

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any terminal or transportation facility within said district; and to make charges for the use thereof; and for any of such purposes to own, hold, lease and/or operate real or personal property, to borrow money and secure the same by bonds or by mortgages upon any property held or to be held by it. No property now or hereafter vested in or held by either state, or by any county, city, borough, village, township or other municipality, shall be taken by the port authority, without the authority or consent of such state, county, city, borough, village, township or other municipality, nor shall anything herein impair or invalidate in any way any bonded indebtedness of such state, county, city, borough, village, township or other municipality, nor impair the provisions of law regulating the payment into sinking funds of revenues derived from municipal property, or dedicating the revenues derived from any municipal property to a specific purpose. The powers granted in this article shall not be exercised by the port authority until the legislatures of both states shall have approved of a comprehensive plan for the development of the port as hereinafter provided.

ARTICLE VII. The port authority shall have such additional powers and duties as may hereafter be delegated to or imposed upon it from time to time by the action of the legislature of either state concurred in by the legislature of the other. Unless and until otherwise provided, it shall make an annual report to the legislature of both states, setting forth in detail the operations and transactions conducted by it pursuant to this agreement and any legislation thereunder. The port authority shall not pledge the credit of either state except by and with the authority of the legislature thereof.

ARTICLE VIII. Unless and until otherwise provided, all laws now or hereafter vesting jurisdiction or control in the public service commission, or the public utilities commission, or like body, within each state respectively, shall apply to railroads and to any transportation, terminal or other facility owned, operated, leased or constructed by the port authority, with the same force and effect as if such railroad, or transportation, terminal or other facility were owned, leased, operated or constructed by a private corporation.

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ARTICLE IX. Nothing contained in this agreement shall impair the powers of any municipality to develop or improve port and terminal facilities.

ARTICLE X. The legislatures of the two states, prior to the signing of this agreement, or thereafter as soon as may be practicable, will adopt a plan or plans for the comprehensive development of the port of New York.

ARTICLE XI. The port authority shall from time to time make plans for the development of said district, supplementary to or amendatory of any plan theretofore adopted, and when such plans are duly approved by the legislatures of the two states, they shall be binding upon both states with the same force and effect as if incorporated in this agreement.

ARTICLE XII. The port authority may from time to time make recommendations to the legislatures of the two states or to the congress of the United States, based upon study and analysis, for the better conduct of the commerce passing in and through the port of New York, the increase and improvement of transportation and terminal facilities therein, and the more economical and expeditious handling of such commerce.

ARTICLE XIII. The port authority may petition any interstate commerce commission (or like body), public service commission, public utilities commission (or like body), or any other federal, municipal, state or local authority, administrative, judicial or legislative, having jurisdiction in the premises, after the adoption of the comprehensive plan as provided for in Article X for the adoption and execution of any physical improvement, change in method, rate of transportation, system of handling freight, warehousing, docking, lightering or transfer of freight, which, in the opinion of the port authority, may be de-

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signed to improve or better the handling of commerce in and through said district, or improve terminal and transportation facilities therein. It may intervene in any proceeding affecting the commerce of the port.

ARTICLE XIV. The port authority shall elect from its number a chairman, vice-chairman, and may appoint such officers and employees as it may require for the performance of its duties, and shall fix and determine their qualifications and duties.

ARTICLE XV. Unless and until the revenues from operations conducted by the port authority are adequate to meet all expenditures, the legislatures of the two states shall appropriate, in equal amounts, annually, for the salaries, office and other administrative expenses, such sum or sums as shall be recommended by the port authority and approved by the governors of the two states, but each state obligates itself hereunder only to the extent of one hundred thousand dollars in any one year.

ARTICLE XVI [as amended,1930].3 Unless and until otherwise determined by the action of the legislatures of the two states, no action of the port authority shall be binding unless taken at a meeting at which at least three of the members from each state are present, and unless a majority of the members from each state present at such meeting, but in any event at least three of the members from each state, shall vote in favor thereof. Each state reserves the right hereafter to provide by law for the exercise of a veto power by the governor thereof over any action of any commissioner appointed therefrom.4

ARTICLE XVII. Unless and until otherwise determined by the action of the legislatures of the two states, the port authority shall not incur any obligations for salaries, office or other administrative expenses, within the provisions of article XV, prior to the making of appropriations adequate to meet the same.

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ARTICLE XVIII. The port authority is hereby authorized to make suitable rules and regulations not inconsistent with the constitution of the United States or of either state, and subject to the exercise of the power of congress, for the improvement of the conduct of navigation and commerce, which, when concurred in or authorized by the legislatures of both states, shall be binding and effective upon all persons and corporations affected thereby.

ARTICLE XIX. The two states shall provide penalties for violations of any order, rule or regulation of the port authority, and for the manner of enforcing the same.

ARTICLE XX. The territorial or boundary lines established by the agreement of eighteen hundred and thirty-four, or the jurisdiction of the two states established thereby, shall not be changed except as herein specifically modified.

ARTICLE XXI. Either state may by its legislature withdraw from this agreement in the event that a plan for the comprehensive development of the port shall not have been adopted by both states on or prior to July first, nineteen hundred and twenty-three; and when such withdrawal shall have been communicated to the governor of the other state by the state so withdrawing, this agreement shall be thereby abrogated.

ARTICLE XXII. Definitions. The following words as herein used shall have the following meaning: “Transportation facility” shall include railroads, steam or electric, motor truck or other street or highway vehicles, tunnels, bridges, boats, ferries, car-floats, lighters, tugs, floating elevators, barges, scows or harbor craft of any kind, air craft suitable for harbor service, and every kind of transportation facility now in use or hereafter designed for use for the transportation or carriage of persons or property. “Terminal facility” shall

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include wharves, piers, slips, ferries, docks, dry docks, bulkheads, dockwalls, basins, car-floats, float-bridges, grain or other storage elevators, warehouses, cold storage, tracks, yards, sheds, switches, connections, overhead appliances, and every kind of terminal or storage facility now in use or hereafter designed for use for the handling, storage, loading or unloading of freight at steamship, railroad or freight terminals. “Railroads” shall include railways, extensions thereof, tunnels, subways, bridges, elevated structures, tracks, poles, wires, conduits, power houses, substations, lines for the transmission of power, car-barns, shops, yards, sidings, turn-outs, switches, stations and approaches thereto, cars and motive equipment. “Facility” shall include all works, buildings, structures, appliances and appurtenances necessary and convenient for the proper construction, equipment, maintenance and operation of such facility or facilities or any one or more of them. [The article continues, with definitions of “real property,” “personal property,” “to lease” and “rule or regulation” . . . .] In witness whereof we have hereunto set our hands and seals under Chapter 154 of the Laws of 1921 of the State of New York and Chapter 151 of the Laws of 1921 of the State of New Jersey, this thirtieth day of April, 1921. William R. Willcox Eugenius H. Outerbridge Charles D. Newton J. Spencer Smith DeWitt Van Buskirk Frank R. Ford Thomas F. McCran

notes 1. Authorized by C. 154, Laws of N.Y. 1921, and C. 151, Laws of N.J. 1921. Approved by Public Resolution No. 17 of the 67th Congress, First Session (August 1921). 2. As amended by C. 419, Laws of N. Y. 1930, approved April 12, 1930 and C. 244, Laws of N. J. 1930, effective April 21, 1930. In the 1921 Compact, this provision read: “The port authority shall consist of six commissioners — three resident voters from the state of New York, two of whom shall be resident voters of the city of New York, and three resident voters from the state of New Jersey, two of whom shall be resident voters within the New Jersey portion of the district, the New York members to be chosen by the state of New York and the New Jersey members by the state of New Jersey in the manner and for the terms fixed and determined from time to time by the legislature of each state respectively, except as herein provided.”

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3. Prior to April 1930, the Port Authority consisted of six commissioners, three from each state, and no action was binding unless it received the vote of two members from each state. 4. New Jersey authorized a veto power for the governor in April 1927; under C. 333, Laws of New Jersey, “the minutes of every meeting of the port authority . . . shall be forthwith transmitted . . . to the governor,” and the governor of the state then has ten days to veto the actions of any of the state’s commissioners. New York also authorized the governor’s veto power in April 1927, with the governor given five days to exercise that power (C. 700, Laws of New York).

Notes

Chapter 1 1. Franklin D. Roosevelt, governor of New York State, address delivered at the dedication of the George Washington Bridge, October 24, 1931. 2. In her major work on public authorities, Annmarie Walsh estimated that in the late 1970s there were more than 7,000 of these agencies operating in the United States. Their defining characteristics are that they have independent corporate status but are wholly owned by government; receive a significant part of their income from rents, tolls, and other user fees; raise money for their activities in the tax-exempt bond market; and do not rely on the taxing power. For discussion of these attributes and of the influence of the Port of New York Authority as a model, see Annmarie H. Walsh, The Public’s Business: The Policies and Practices of Government Corporations (Cambridge: MIT Press, 1978), chapters 1, 2 and 7; Robert Caro, The Power Broker: Robert Moses and the Fall of New York (New York: Random House, 1974), pp. 615–617; J. W. Doig, “ ‘If I See a Murderous Fellow . . . ’,” Public Administration Review (July/August 1983), pp. 292–304; Robert G. Smith, Public Authorities in Urban Areas (National Association of Counties, 1969); Jerry Mitchell, ed., Public Authorities and Public Policy (Westport, CT: Greenwood, 1992); Donald Axelrod, Shadow Government (New York: Wiley, 1992); and Jerry Mitchell, The American Experiment with Government Corporations (Armonk, NY: M. E. Sharpe, 1999). On agencies in the West, see Herman L. Boschken, Strategic Design and Organizational Change (Tuscaloosa: University of Alabama Press, 1988), and Steven P. Erie, “How the Urban West Was Won,” Urban Affairs Quarterly (June 1992), especially pp. 547–550. On TVA, see Walsh, chapter 2, and Erwin C. Hargrove and Paul Conkin, eds., TVA: Fifty Years of Grass-roots Bureaucracy (Urbana: University of Illinois Press, 1983). 3. Macleish, “Port of New York Authority,” Fortune, Sept., 1933, p. 119. 4. Samuel Eliot Morison, Oxford History of the American People, as quoted in David M. Potter, People of Plenty (Chicago: University of Chicago Press, 1954), p. 7. See also Herbert McCloskey and John Zaller, The American Ethos (Cambridge: Harvard University Press, 1984), chapters 1 and 6. 5. On this facet of Progressivism, see Herbert Kaufman, “Emerging Conflicts in the Doctrines of Public Administration,” American Political Science Review, 50 (1956), pp. 1057–1073; Martin J. Schiesl, The Politics of Efficiency: Municipal Administration and Reform in America, 1880–1920 (Berkeley: University of California Press, 1977); and Marver H. Bernstein, Regulating Business by Independent Commission (Princeton: Princeton

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University Press, 1955); the text quotation is from Bernstein, p. 36. Among the important early writings which laid the groundwork for this aspect of Progressivism were post-Civil War essays by Henry Adams on corruption in American government, and Woodrow Wilson’s article, “The Study of Administration,” Political Science Quarterly, 2 (June 1887), pp. 197–222, in which he argued that government agencies should be designed, staffed, and operated so as to achieve high levels of efficiency. 6. Herbert Croly, The Promise of American Life (New York: Macmillan, 1909), esp. chapter 11; the quotation is on pages 346–347. For a thoughtful discussion of the several elements of Progressive thought, see Arthur S. Link and Richard L. McCormick, Progressivism (Arlington Heights, IL: Harlan Davidson, 1983), chapters 1 and 2. 7. See Arthur S. Link et al., The Papers of Woodrow Wilson (Princeton: Princeton University Press, 1976, 1977), vol. 22, pp. 102–105; vol. 23, pp. 165–169; vol. 24, pp. 168–173. Wilson’s reform successes as governor in 1911–13 included a law aimed at ending vote-buying and other corrupt practices in elections; legislation which set up a state-wide accident-insurance system; antitrust legislation; and creation of a state board to regulate public-utility rates and services. 8. In emphasizing his state’s part in the region’s development, Wilson expressed the traditional sensitivity regarding New Jersey’s perceived position as second fiddle to New York; but he noted that a lively smaller state might play a positive role. His most striking expression of this view would have won him plaudits from Count Dracula: “New Jersey . . . must be a sort of laboratory in which the best blood is prepared for other communities to thrive upon” (Link, Papers vol. 22, p. 369). On Wilson’s views regarding transportation, commerce and regional economic development, see Link, Papers, vol. 22, pp. 367–374, vol. 24, pp. 183–84; the “every harbor” quotation is on 184. 9. These were values that had been nurtured in the expanding American nation throughout the 1800s. On their importance in early nineteenth-century America and beyond, see Irving Howe, The American Newness (Cambridge: Harvard University Press, 1986). Howe also captures some of the less attractive ways in which these values are likely to be combined in the United States—for example, “opportunistic aggrandizement which is often set free by the ethos of individualism” (p. 46). 10. See New York, New Jersey Port and Harbor Development Commission, Joint Report, 1920, Part III; and Erwin W. Bard, The Port of New York Authority (New York: Columbia University Press, 1942), chapters 1 and 2. 11. Similar patterns of inter-regional competition and business support have shaped the opportunities and the activities of other public authorities, and of urban-development agencies generally in the United States. See for example Walsh, The Public’s Business, 1978; Herman L. Boschken, Strategic Design and Organizational Change, 1988; Marc J. Hershman, ed., Urban Ports and Harbor Management (New York: Taylor & Francis, 1988); Paul E. Peterson, City Limits (Chicago: University of Chicago Press, 1981); Susan S. Fainstein and others, Restructuring the City (New York: Longman, 1983). 12. On the pressure toward rational-legal behavior in organizations, and conflicts with communitarian values within organizations and in society, see Charles Perrow, Complex Organizations, 3rd edition (New York: Random House, 1986), chapter 1 and pp. 166 ff.; and Samuel P. Hays, Conservation and the Gospel of Efficiency (New York: Atheneum,

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1969). For an insightful study of the ways in which rational-legal values are mixed with other interests in shaping the actions of business elites, see David C. Hammack, Power and Society: Greater New York at the Turn of the Century (New York: Russell Sage, 1982), especially chapter 4. 13. See Kenneth T. Jackson, Crabgrass Frontier: The Suburbanization of the United States (New York: Oxford University Press, 1985); Michael N. Danielson and Jameson W. Doig, New York: The Politics of Urban Regional Development (Berkeley: University of California Press, 1982), chapters 1–5. 14. For the text quotation, see Link and McCormick, Progressivism, 1983, p. 21; cf. Dwight Waldo, The Administrative State (New York: Ronald Press, 1948), pp. 18–19. Referring to the attitudes of city planners and engineers in the first years of the twentieth century, urban historian Carl Condit comments: “It was an age of confidence and buoyant expectations, an age sure that it possessed the means for solving all urban problems through a new partnership between the municipality and the supporting economy.” Condit, The Port of New York (Chicago: University of Chicago Press, 1981), p. xi; see also Condit, pages 122–125. 15. Pendleton Herring, Public Administration and the Public Interest (New York: McGraw-Hill, 1936), p. 377. 16. Suggesting the “garbage can” model of decisionmaking, as described by James March: Any structure of social behavior can be viewed as a sort of “garbage can” into which “various kinds of problems and solutions are dumped by participants as they are generated.” At times a searcher will find something in the “can” which can be useful in solving the searcher’s own problems. See James G. March, Decisions and Organizations (London: Basil Blackwell, 1988), pp. 13, 294–323; the quotation is on p. 296. Cf. John W. Kingdon, Agendas, Alternatives, and Public Policies (New York: Little, Brown, 1984), pp. 89–94 and 181 (where mass transit is described as a solution that is attached to various problems over time). 17. From Roosevelt’s address at the dedication of the George Washington Bridge, October 24, 1931. 18. Bard, 1942, pp. 320, 327. 19. Wilson, “The Study of Administration,” Political Science Quarterly, 1887, pp. 213–214. 20. “In their experience,” writes Herbert Kaufman in summarizing the views held by many career public officials, “political intrusion into their affairs is usually intended to do special, often questionable, favors for political constituents or other special interests. It is generally motivated by short-run political opportunities. . . . It is frequently arranged privately, even clandestinely. It is often based on little or no information, or even on misinformation, especially in technical and complex fields.” Herbert Kaufman, “The End of an Alliance,” in Naomi Lynn and Aaron Wildavsky, eds., Public Administration: The State of the Discipline (Chatham, NJ: Chatham House, 1990), p. 487. On regulatory commissions, see for example, Bernstein, 1955. Serious problems at many public authorities are analyzed in Diana B. Henriques, The Machinery of Greed (Lexington, MA: D. C. Heath, 1986) and in Axelrod, 1992. On NASA and the savings-and-loan agencies, see David Ermann and Richard Lundman, eds., Corporate and Governmental Deviance (New York: Oxford University Press, 1992), chapters 4, 9.

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21. This list of “entrepreneurial strategies” is taken from J. W. Doig and E. C. Hargrove, ed., Leadership and Innovation: A Biographical Perspective on Entrepreneurs in Government (Baltimore: Johns Hopkins University Press, 1987), chapter 1, and is based in part on earlier analyses by Philip Selznick (especially Leadership in Administration [Evanston, IL: Row, Peterson, 1957]) and Joseph A. Schumpeter (especially Theory of Economic Development [Cambridge: Harvard University Press, 1934], chapter 2). See also E. C. Hargrove, Prisoners of Myth: The Leadership of the Tennessee Valley Authority, 1933–1990 (Princeton: Princeton University Press, 1994). 22. In understanding the activities and impact of the Port Authority, rational calculation and a systematic search for opportunities by the agency’s leaders are important factors, as I argue here and throughout the book. However, as Herbert Kaufman emphasizes, fortuitous happenings or “chance” also plays a role; see his Time, Chance, and Organizations, 2nd ed. (Chatham, NJ: Chatham House, 1991), especially chapter 4. See also Laurence E. Lynn, Jr., Public Management as Art, Science, and Profession (Chatham, NJ: Chatham House, 1996), chapter 4. 23. Charles T. Goodsell, “Emerging Issues in Public Administration,” in Lynn and Wildavsky, eds., Public Administration, 1990, pp. 498–499. See also Doig and Hargrove, 1987, chapter 1 and passim; Lynn, 1996, pp. 69 ff.; and Richard A. Loverd, Leadership for the Public Service (Englewood Cliffs: Prentice Hall, 1997). For an insightful use of biographical analysis with a more pessimistic theme, see Eugene Lewis, Public Entrepreneurship (Bloomington: Indiana University Press, 1980). 24. Joseph A. Schumpeter, 1934, p. 93. 25. See Walsh, 1978, chapters 1,2; J. W. Doig and Jerry Mitchell, “Expertise, Democracy, and the Public Authority Model,” in J. Mitchell, ed., 1992, pp. 17–29. 26. See for example, Boschken, 1988, p. 159 and passim; and chapters 11 and 12 in this volume. 27. See for example the analysis in John J. Harrigan, Political Change in the Metropolis, 4th edition (Glenview, Ill.: Scott, Foresman, 1989), chapters 8–9. 28. Hargrove, 1994, p. 299. The earlier quotations in this paragraph are from Walsh, 1978, p. 8; and see pp. 38–39, 338–340. 29. See Walsh, 1978, p. 177; Herson and Boland, The Urban Web, 1990, p. 254; New York Times, June 1, 1996; New York Times, March 30, 1997.

Chapter 2 1. Much of the transportation activity was tied directly or indirectly to international trade. In addition, the movement of manufactured goods, food, and other products within the bi-state area also placed a large burden on the region’s terminal and transport system. [The prime source for information about trade and transportation patterns in the New York region during the early twentieth century is the study carried out by the New York, New Jersey Port and Harbor Development Commission during the years 1917–1920, and summarized in its Joint Report with Comprehensive Plan and Recommendations (1920, 495 quarto pages); the Commission report is generally cited by students of that era as the Red Book (because of its cover and massive size) and that appellation will be used

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here. On the facts summarized in the text above, see the Red Book, 1920, chapters 2–7, esp. pp. 140 ff.; also, Benjamin Chinitz, Freight in the Metropolis (Cambridge: Harvard University Press, 1960), chapters 1, 2 and 4; Roy S. MacElwee, Ports and Terminal Facilities (New York: McGraw-Hill, 1918), pp. 86–96, 105–112 and passim.] 2. As the legal counsel for the New York interests admitted, years later: “The simple fact is that there was a great deal of merit in New Jersey’s complaint about the costliness of operation of the Port of New York. This very car-floatage and lighterage was a costly operation.” J. H. Cohen, They Builded Better than They Knew (New York: Julian Messner, 1946), p. 279. 3. For further details, see the Red Book, 1920, ch. 1; Bard, The Port of New York Authority, 1942, pp. 9–10, 16–18; Cohen, 1946, pp. 274–77. 4. Cohen, 1946, 274–75. As a leading New York official commented a few years after the suit was concluded: “The differential requested by the State of New Jersey was 3 cents a hundred pounds, or 60 cents a ton. Naturally, that request was very bitterly fought by the State of New York, because [we could] understand what it means for this city . . . if the man engaged in business on the shores of New Jersey, or of Newark Bay, or in its manufacturing sections, were to have the benefit and advantage over him of 60 cents a ton on the millions and millions of tons of raw products that come into this port to be manufactured.” (Alfred E. Smith, “The Port Authority and the Development of the Port of New York,” address, March 18, 1922.) 5. In the 1880s and 1890s, the Chamber had played a major role in fighting for the consolidation of Manhattan, Brooklyn and the outlying areas into a Greater New York, and since the late 19th century its leaders had been arguing that economic development in the City and the region was handicapped by street congestion and other transport problems, requiring vigorous remedial action. See Hammack, Power and Society, 1982, pp. 188ff. 6. Outerbridge had banking interests in Manhattan and manufacturing plants in Passaic, in Northern New Jersey, and in Trenton. Bush also had regional interests, but his main occupation—the Bush Terminal Company in Brooklyn—provided him with a strong motivation to protect the existing rate system: As Cohen noted, the economic health of that marine terminal and “all the other Brooklyn terminals” depended on the existing system; a freight-rate system which added the cost of lighterage would threaten the viability of those docks and warehouses. (Cohen, 1946, pp. 272, 277.) 7. See Doig, Public Administration Review, 1983, 292–304, and sources cited there. 8. Tammany was the popular name for the Democratic political organization in Manhattan. Formed in the 1780s, Tammany was by the 1860s associated with the provision of services to the urban poor and with corruption. After the merger of Manhattan with Brooklyn and other local areas in 1898, Tammany politicians often developed alliances with Democratic leaders in the other boroughs. 9. For example, he was active in the Committee of 100 which fought Tammany Hall in the years 1910–1914 and campaigned successfully for reform candidates for mayor and district attorney in New York City. Cohen also became acquainted with Alfred E. Smith during Smith’s “Tammany period” and followed his evolution into reform politics, of which more below. (Cohen, 1946, pp. 8, 12, 21–24, 43, 112–114, 350; and Alfred E. Smith, Up To Now: An Autobiography [New York: Viking Press, 1929], chapters 8–10.)

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10. See Julius Henry Cohen, Law and Order in Industry (New York: Macmillan, 1916), pp. 17ff., 34ff., 243–257; Cohen, Commercial Arbitration and the Law (New York: Appleton, 1918), Introduction, chapters 1–3 and passim; Cohen, 1946, pp. 152–155, 192–198, 218–222; Alpheus Thomas Mason, Brandeis: A Free Man’s Life (New York: Viking, 1946), pp. 289–314; Elisabeth Israels Perry, Belle Moskowitz: Feminine Politics and the Exercise of Power in the Age of Alfred E. Smith (New York: Routledge, 1992), pp. 80–95. 11. Cohen’s perspective on the role of planning and competition in American society is developed most fully in his 1933 essay, “Ice.” There he argued that while traditional American culture uses “individualistic motivations to accomplish its ends . . . , future education must [place] more emphasis on service and satisfactions incidental to achieving the objects of a group. . . . The unrestrained play of economic competition—is as obsolete . . . as is the old-fashioned stage coach.” Cohen continued, “We shall not be converted to the Russian experiment, though we shall be influenced by it. The day of thinking in terms of enforced monopoly and enforced cooperation in the public interest and for the social good has already arrived.” Later in the essay, he emphasized the value of permitting individual states to experiment, serving as laboratories for new social and economic programs. Cohen built his analysis upon a narrower argument favoring state experimentation, set forth by Justice Brandeis in New State Ice Co. v. Liebmann, 285 U.S. 262 (1931), dissenting. [See J. H. Cohen, “Ice,” Boston University Law Review, 13 (January 1933), pp. 1–21; quotation on p. 7. The most important exploration of Cohen’s social and political philosophy is Gerald Fetner, “Public Power and Professional Responsibility: Julius Henry Cohen and the Origin of the Public Authority,” American Journal of Legal History, 21 (1977), pp. 15–39, esp. 20–28, 31–39. Among Cohen’s own writings, see especially Cohen, 1916, pp. 224–241 and Cohen, 1946, chapters 1, 5–6, 11, 14, 17–18, 28.] 12. The discussion below and in chapter 3 treats the evolution of the regional conflict between 1917 and 1922 primarily from Julius Henry Cohen’s perspective, and in terms of his own strategies, successes, and failures. Other individuals made important contributions, as the discussion will indicate; and broader political coalitions and economic forces both propelled Cohen and his allies forward, and destroyed important pieces of their vision on the rocks of political opposition. Even so, Cohen was far and away the most important figure: the legal analysis of the issue was his; earlier experience in the New York region and at other ports was screened through his eyes and interpreted through his pen; the idea of using the Compact Clause of the U.S. Constitution in designing the new agency was Cohen’s; and the complex political strategies recounted below appear to have come mainly from his Machiavellian brain. [To place Cohen at the center of the creation and early evolution of the Port Authority is not a new idea. The early scholarly study of the agency’s first two decades takes that position (see Bard, 1942, especially pp. 17–21, 27 and 62), as does Robert Caro, (Power Broker, 1974, pp. 616–17, 922). However, those accounts devote little attention to the sources of Cohen’s ideas, or to an analysis of his strategies; and consideration of these aspects strengthens the case for viewing Cohen as the most crucial participant during the six years from 1917 through 1922. On those matters, the major secondary source is Fetner’s 1977 article, which uses materials in state archives as well as Cohen’s own writings to explore his ideas and values. As to primary sources, Cohen was a prolific writer, writing several books on prob-

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lems of industry and labor during the years 1916–1919, laying out his views on historical as well as legal issues involved in the New York Harbor Case in his legal briefs in 1918–1920, and amplifying his views in a series of articles and addresses in 1920–1922 and later. Very helpful also are Cohen’s autobiographical reminiscences (Cohen, 1946, 376 pp), which are sometimes inaccurate as to dates but otherwise appear to be reliable. My understanding of Cohen’s ideas and activities has also been aided by discussions with Erwin Bard (in 1982–84) and with three lawyers who served on Cohen’s staff at the Port Authority during the 1930s—Mortimer Edelstein (interviewed in 1984–87), Daniel Goldberg (1984–85), and William Pallmé (1987).] 13. See Cohen, “The New York Harbor Problem and Its Legal Aspects,” Cornell Law Quarterly, 5 (May 1920), pp. 373–408, and Cohen, 1946, pp. 277–78. On the impact of the Erie Canal, see also Chinitz, 1960, pp. 12–14, 26–27, 45. 14. Gibbons v. Ogden, 22 U.S. 1 (1824). 15. See the Red Book, pp. 42–43; Bard, 1942, pp. 5–6. For trenchant analysis of the interstate hostilities leading to the 1934 Compact, see Michael J. Birkner, “State Wrongs and States’ Rights,” paper presented at the Seminar on New Jersey History, March 29, 1989, and Birkner, “The New York-New Jersey Boundary Controversy, John Marshall and the Nullification Crisis,” Journal of the Early Republic, 12 (Summer 1992), pp. 195–212. 16. See Cohen, 1920; cf. Felix Frankfurter and James M. Landis, “The Compact Clause of the Constitution: A Study in Interstate Adjustments,” Yale Law Journal, 34 (1925), pp. 685 ff. 17. The main elements of this controversy, as they were seen by those searching for ways to improve interstate cooperation during that period, are summarized in the Red Book, 1920, pp. 36, 51–52, 431–34, 438 ff.; see also Bard, 1942, p. 9. 18. See Red Book, 1920, p. 51. At that time, there were no permanent interstate commissions in operation; interstate compacts had been used only to settle boundary disputes and to meet temporary problems. 19. The bridges over the East River were the Williamsburg, completed in 1903, and the Manhattan (1910), to lower Manhattan, and the Queensboro (1909), which entered Manhattan at 59th Street. New York City’s subway-building activities were also viewed as important in stimulating economic growth in the late nineteenth and early twentieth centuries. (To the north, Manhattan is separated from The Bronx by the Harlem River, which is narrow at several points and had been spanned by bridges in the late eighteenth century.) 20. Most passengers crossing the Hudson during these years were bound for lower Manhattan; because of the width of the River at that point, as well as heavy traffic by large ships, placing a bridge there seemed nearly impossible. Even at 57th Street and further north, the Hudson River was much wider than the East River; and since the Hudson was a major navigable waterway, the federal government would not permit a bridge pier to be placed in the River. Thus any bridge across the Hudson to Manhattan would need to have a central span twice as long as any yet constructed. The possibility of tunneling under the Hudson had been dramatically demonstrated by the Pennsylvania and Hudson & Manhattan railroads in 1909–1910, when they completed rail tunnels from Northern New Jersey to Manhattan. By 1913 it seemed clear that

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a vehicular tunnel would cost less than a vehicular bridge, but sentiment was divided as to whether tunnel ventilation would be adequate to prevent motoring travelers from succumbing to noxious gases. (On these uncertainties and divisions, see New York Times, Jan. 29, 1911, the 1913 report of the New York State Commission, and discussion in chapter 4.) 21. See Cohen, 1946, pp. 259–260. 22. Wilson’s 1911 statement is quoted in the Report of the New Jersey Harbor Commission, February 1914, p. 41. Governor Dix urged that the two commissions adopt a plan which would provide for the “comprehensive, orderly development of the port as a whole” (New York Times, March 4, 1911). 23. For Tompkins’ views see the New York Times, July 23, July 27, Nov. 3, Dec. 10 and Dec. 22, 1911. 24. These arguments, and those summarized in the paragraphs below, are set forth in New Jersey Harbor Commission, 1914 Report, pp. 4–6, 32–38. 25. New Jersey Harbor Commission, 1914, p. 5. 26. Drawing on the state’s long tradition of local-government home rule, municipal leaders opposed giving any state agency the power to block local decisions on how its own waterfront would be used. Two other factors also undercut the prospects that the new agency could shape development on the waterfront: (1.) Valuable sites for new shipping piers were owned by the railroads and used to float their goods across the River. State modernization efforts might force them off the waterfront (and perhaps into consolidated piers and terminals, which they could not control). Railroad executives had extensive influence in the state legislature, and they were able to ensure that the state’s development agency would not be give the powers needed to take over railroad properties. (2.) Under the New Jersey Constitution the state could not float bonds for capital improvements exceeding $100,000 without a state-wide referendum, so the new state agency could not engage directly in the pier modernization program. Basically, it would be limited to urging that local governments modernize their waterfronts, a campaign with little prospect of success. 27. N. J. Board of Commerce and Navigation, Annual Report for 1915 (Trenton, 1916), pp. 13–14. The developments in 1911–1915 are summarized on pages 9–12 of Bard’s book. However, neither Bard nor other sources explain why the New Jersey strategists suddenly, in 1915, introduced the argument that the freight pricing system used by the railroads was unfair to their state. My own reading of the evidence suggests that Brandeis deserves a major share of the credit (or blame) for this argument and for the New York Harbor litigation that followed in 1916–1917. Brandeis had conducted a sustained campaign from 1910 onward to force the railroads to employ “scientific management” principles in order to analyze their costs, and then to use this information to reduce their costs and their charges to the shipper. As a result of his efforts, the ICC in 1914–15 pressed the railroads to provide separate cost information—on the long haul portion of their service, local transportation within a port or urban area, and terminal costs. When the railroads finally complied in 1915, the high costs of local and terminal services—especially in the New York region—were revealed. For example, the average cost to carry one ton of goods from the Philadelphia area to northern New Jersey was 27 cents; the same goods absorbed $3.65 in costs if they were floated across the Bay to New York ship-

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ping piers. New Jersey then “seized upon” the analysis, as the New York Times put it, “as a pretext for the division of the national port into two.” (Editorial in the Times, Dec. 24, 1918; see also the editorial on May 16, 1917. On Brandeis’s efforts, see Mason, 1946, chapters 20–21.) 28. See the Red Book, 1920, pp. 83–85 and 214ff. on the City’s port development problems. The complexities of planning and finance associated with New York City’s subway system are discussed in Hammack, 1982, chapter 8 and in Peter Derrick, “Catalyst for Development: Rapid Transit in New York,” New York Affairs, vol. 9 (Fall 1986), pp. 37–48. 29. For a summary of these events and complete citations to the briefs, see Bard, 1942, pp. 12, 17. Governor Fielder’s support was shaped by his early experience; he had grown up in Jersey City, which had a long tradition of hostility to New York, and before being elected to the governor’s office in 1913, he had represented Jersey City and other towns in the area as Hudson County’s state senator. 30. On the general tension between Albany and New York City officials, see Wallace S. Sayre and Herbert Kaufman, Governing New York City (New York: Russell Sage Foundation, 1960), esp. pp. 564–592; Warren Moscow, Politics in the Empire State (New York: Knopf, 1948), chapter 13. 31. For detailed discussions of these developments, see the Red Book, 1920, chapter 8, and Bard, 1942, pp. 12–16. 32. The New Jersey brief submitted to the ICC in 1916 conveyed these themes in vigorous terms: “The expense of conducting business on Manhattan Island has become excessive. High rents, high taxes, high insurance rates, congestion of the streets, congestion at the pier stations and shipping yards of the railroads . . . are all a burdensome tax upon business conducted at this port, which can only be completely removed by the reorganization of the Port as a whole, and utilizing the advantages of the New Jersey shore and navigable waterways near its great Port . . . . “The only way that this difficulty can be solved permanently and in the interest of the whole country is to . . . give to the New Jersey side advantages which nature has provided. Such a reorganization, on scientific lines, will . . . enable all business at this port to be conducted on the basis of the greatest possible economy.” (New Jersey brief, as quoted in the Red Book, 1920, pp. 52, 54; emphasis added.) Brandeis’s influence on the ICC is examined in Mason, 1946, chapters 20–21. During the first years of the twentieth century, reliance on experts became a major theme in public life generally, “with efficiency rather than moral purity its objective.” Urban reformers were confident that “scientific government . . . would bring opportunity, progress, order, and community.” Robert Wiebe, The Search for Order, 1877–1920 (New York: Hill and Wang, 1967), pp. 171, 170. 33. See for example the comments of Newark business leaders, quoted in the Red Book, 1920, pp. 55, 57. 34. As noted earlier, Cohen’s work on labor problems in the garment industry, and his efforts to encourage arbitration in resolving business disputes, were based on this philosophy. In his 1916 book, Cohen wrote of the importance of creating a “permanent tribunal” which could serve as “the supreme court” of an industry, so neither side would need to “resort to war, i.e., strikes and lockouts.” And he set forth the general principles that

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guided Brandeis, Cohen and their associates in creating and sustaining the garment-industry Protocol: “Assuming controversy and conflict between parties having divergent interests as inevitable, that such controversy and conflict should be put upon the plane of procedure of civilized and orderly men, that justice, however approximate, should be arrived at by the rational method, and that law and order should take the place of anarchy.” (Cohen, Law and Order in Industry, 1916; the quotations are on pages 36 and 42.) 35. See New York Harbor Case, No. 8994 (47 ICC 643, 1917.): Brief on behalf of the State of New York, the Chamber of Commerce of the State of New York, and the Merchants Association of New York City, October 1916. 36. See Cohen, 1946, pp. 273–74, 218. 37. The general assessment of Mitchel and the quotation are from Sayre and Kaufman, 1960, pp. 692–94. In 1914–15, Mitchel had also worked with Cohen on issues arising out of the 1910 Protocol; see Cohen, 1946, pp. 206–207, 227. 38. Edge stressed these themes in his fall 1916 campaign and in his January 1917 inaugural address; at the time most of the state’s roads were unpaved and deeply rutted. See his biographical reflections, Walter Evans Edge, A Jerseyman’s Journal: Fifty Years of American Business and Politics (Princeton: Princeton University Press, 1948), pp. 84–92; quotations are from pp. 84 and 89. On his earlier work as state senator, see Ibid., chapter 4; Paul A. Stellhorn and Michael J. Birkner, eds., The Governors of New Jersey, 1664–1974 (Trenton: New Jersey Historical Commission, 1982), p. 187. 39. New York Times, Jan. 12, 1917; see also Jan. 11, 1917. The New York side appeared to suffer from no such weaknesses in character; as Cohen commented a few years later, New York’s leadership in port development was mainly a product of “the initiative and farsightedness of her people,” who built terminals along the waterfront “on a gigantic scale, worthy of the natural gifts with which it is endowed.” (J. H. Cohen, “The New York Harbor Problem and Its Legal Aspects,” Cornell Law Quarterly, vol. 5 [May 1920], p. 374.) 40. New York Times, Jan. 28, 1917. 41. Edge’s speech is included in the Chamber of Commerce’s Monthly Bulletin, March 1917, pp. 43–46, and is quoted in part in Bard, 1942, p. 25. Cohen’s later comment is in Cohen, 1946, p. 281. 42. In sending the bill to the state legislature on March 12, Governor Whitman noted that “all but two of the [rail] trunk lines serving the Port of New York” terminate in New Jersey and that therefore the Port’s problem could only be ameliorated through joint action of the two states. In his message to the Trenton legislature on March 14, Edge said that he favored a “far-sighted interstate commission, which is oblivious to sectional prejudices and intent upon developing an important section of the country along broad lines.” Red Book, 1920, p. 58; also quoted in Bard, 1942, p. 25. The two bills are included in the Red Book, pp. 494–95; the drafting of the bills is discussed in Cohen, 1946, p. 281. The New Jersey bill was signed into law on March 26 and the New York bill on May 8, 1917. 43. Record in the New York Harbor Case, as quoted in the Red Book, p. 58. 44. These early steps are described in the Red Book, 1920, p. 59. Spencer Smith served as chairman of New Jersey’s State Board of Commerce and Navigation, a leading advo-

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cate of New Jersey’s ICC litigation. However, Smith’s testimony at the ICC hearing showed that he saw the value of positive joint action to improve North Jersey’s commerce, so Edge appointed not an enemy but rather of an evolving friend of bi-state cooperation. (See Cohen’s later reflections in Cohen, 1946, pp. 275, 279, 281.) General Goethals had been in New Jersey since early 1917, serving under Governor Edge as the state’s chief engineer in charge of highway modernization. (Having advocated efficient, nonpolitical improvement of New Jersey’s highway system as a major goal during his fall 1916 campaign, Edge had approached Goethals, whose success in building the Panama Canal—completed in 1914—had made him world famous, to take charge of the task. Somewhat to Edge’s surprise, as he later reported, Goethals accepted; and during the next several years, while consulting with the bi-state commission, he “did a superb job of highway and bridge-construction work, keeping both far above partisan politics.” Edge, 1948, pp. 90–91; cf. Stellhorn and Birkner, 1982, p. 188.) 45. The quotation is from the Red Book, 1920, pp. 60–61. For a more detailed discussion of the War Board, see Cohen, 1946, pp. 283–287, and articles in the New York Times, beginning with Nov. 4–8, 1917. On congestion in the early years of the war, see for example the New York Times, October 22, 26, Nov. 18, 1915. By December 1916, “the worst freight car congestion in the history of American railroads had clogged and choked the port of New York. For miles upon miles out of New York in every inland direction, cars were stacked up along the sidings and switches. Rail traffic suffered a partial paralysis.” (Benedict Crowell and R. F. Wilson, The Road to France [New Haven: Yale University Press, 1921], p. 113.) The situation in the fall of 1917, as Cohen and the bi-state Commission saw it, is reported in Cohen’s autobiography: “There was chaos in the Port of New York. Shipments came here from all over the country sent by the Navy, by the Army and by the United States Shipping Board. Each department organized and shipped separately. There was no single head. There was no coordination. . . . Cars piled up on tracks as far back as Pittsburgh. Great piles of much needed war equipment were dumped along the railroad tracks” (Cohen, 1946, p. 283). For a detailed account of the problem and actions taken in 1917–18, see Crowell and Wilson, 1918, especially chapters 9–11. I am indebted to Josef Konvitz for calling this book to my attention. 46. The ICC decision is quoted extensively in the Red Book, 1920, pp. 55–59; see also Bard, 1942, pp. 20, 23. 47. The quotations from the Commission’s opinion are on pp. 56–57 of the Red Book; and see New York Harbor Case, 47 ICC 643 ff., at 732–39.

Chapter 3 1. Elting E. Morison, Turmoil and Tradition: A Study of the Life and Times of Henry L. Stimson (New York: Houghton Mifflin, 1960), pp. 240–241. Or, as one commentator on the Progressive Era writes, “the new reformers” who took center stage in the early twentieth century appeared to be driven by “an impatience with the inertia that slowed their irresistible march to victory” (Wiebe, The Search for Order, 1877–1920, 1967, p. 165). 2. Morison, 1960, pp. 243–244.

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3. The Port and Harbor Development Commission requested and received $200,000 a year for two years. As Erwin Bard noted, the state legislatures might not have parted with this large sum so readily but for the convergence of three factors: (1.) wartime-induced traffic congestion in the Port of New York had caused much freight to be diverted to other ports, and there was concern that those ports might be able to hold that traffic and attract more in the future, if the New York transport system were not modernized; (2.) the December 1917 ICC decision in the New York Harbor case blocked New Jersey from pursuing its litigation strategy, while also providing a warning to New York interests that the alternative to cooperative bi-state modernization might be a reopening of the Harbor Case; and (3.) in January 1918 a separate commission appointed by New York’s governor released a report on the massive congestion along Manhattan’s west side which emphasized the need for modernization in order to solve that vexing problem. See Bard, The Port of New York Authority, 1942, p. 26. 4. Cohen’s December 1918 draft is reprinted in the Red Book, 1920, pp. 472–474. The Port Authority’s possible future role in pollution regulation is discussed on pp. 431 and 438–439. 5. Thus realizing some of the hopes of Woodrow Wilson and other Progressive Era activists; see chapters 1 and 2 above. 6. See J. W. Doig, Public Administration Review, 1983, pp. 292–304; Link and McCormick, Progressivism, 1983, pp. 22–25, 42–47. 7. Cohen, Cornell Law Quarterly, 1920, p. 377. 8. Here Cohen was able to draw upon the thinking of the earlier New York State Commission concerned with water pollution; as noted in chapter 2, that study group had proposed in 1905 that a metropolitan district be established, embracing portions of both states, and that a bi-state agency be created to regulate sewage disposal within the district. Cohen also drew upon international legal principles ; as he noted, the American states had been “so successful” in retaining their “complete and independent sovereignty,” except on matters expressly delegated to the national government, that “any questions arising between them are treated as though they were individual nations and are interpreted by the canons of international law.” (Red Book, 1920, p. 455.) The Port of New York Authority was apparently the first government agency in the United States which used the word “authority” in its title. Previously, a semi-independent regulatory or operating unit of government would generally be called a “board” or “commission.” His proposed title was taken from the Port of London Authority, which had been created in 1908. See Robert G. Smith, Public Authorities, Special Districts and Local Governments (National Association of Counties, 1964), chapter 1; Cohen, 1946, pp. 289–290. 9. The relevant portion of Article I, Section 10, reads: “No State shall, without the Consent of Congress, lay any Duty of Tonnage, keep Troops, or Ships of War in time of Peace, enter into any Agreement or Compact with another State, or with a foreign Power. . . ” (emphasis added). On earlier uses of the Compact Clause, and the reasons for its limited use, see Frankfurter and Landis, Yale Law Journal, 1925, pp. 685–758. While considering how to construct the new agency, Cohen had consulted with a friend who chaired the Palisades Park Commission, which had been set up in the usual

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mode—two separate state commissions working together. The legal and administrative weaknesses of that body helped convince Cohen to search for another route to interstate cooperation. (Cohen, 1946, pp. 290–291.) 10. When a compact has been approved by Congress, Cohen noted, “if one [state] becomes recalcitrant in the execution of its obligations,” then a “higher power, the nation,” can force action. (Cohen, “The Legal Aspects of the Problem,” included in Red Book, 1920, pp. 444–472; quotation at 455.) The source of national power in this case is again Article I, Section 10: “Since a state is forbidden by the Constitution to impair the obligation of contracts, it cannot unilaterally renounce an interstate compact except as agreed to by the parties” (Frederick L. Zimmerman and Mitchell Wendell, The Law and Use of Interstate Compacts [Council of State Governments, 1961], p. 40). 11. As the bi-state study commission noted, New York City’s port-development program had been hampered because “its head is subject to removal by the Mayor and usually has been removed with each change of administration.” (Red Book 1920, p. 84.) The problem of political turnover was underscored as Cohen began work on the draft compact: reform mayor Mitchel was defeated by Tammany politician John F. Hylan, who took office in early 1918 and immediately swept out of office the City’s Dock Commissioner and other senior officials. Prominent multi-headed agencies at the national level were the Interstate Commerce Commission and the U.S. Civil Service Commission, both created in the 1880s, and the Federal Reserve Board and Federal Trade Commission, created during the first years of Woodrow Wilson’s presidency. Many states and cities also used this design in an attempt to insulate the administration of public health agencies, prisons, and other programs from the direct control of elected officials, who might alter policies and personnel sharply— and perhaps for narrow partisan purpose—whenever one political party or faction beat the incumbents at the polling booth. See Herbert Kaufman, American Political Science Review, 50 (1956), pp. 1057–1073; and Bernstein, 1955. 12. An important influence in the design of the Port of New York Authority—particularly on the issue of appointment and payment of board members—was experience at London and Liverpool. At the Port of London Authority, created in 1908, and at the Liverpool port agency, formed in the nineteenth century, most of the board members were elected by commercial users of the port and they were unsalaried. When Cohen and Outerbridge consulted with officials in Britain, they were “advised strongly that we would get better Commissioners if they were not paid.” Positions without salary “would be sought after as posts of honor,” they were told, but “if the positions were put on a salary basis, they would most likely become part of the political patronage of the party in power.” (Cohen, 1946, p. 289; the quotations are Cohen’s recollections.) Cohen does not discuss the experience at Liverpool in any detail, but its long history of local and semi-independent control was directly relevant to the New York situation and had been summarized in the 1914 report of the New Jersey Harbor Commission; Cohen probably reviewed that information carefully. Harbor facilities at Liverpool had once been controlled by the Common Council of the city, and some fees were allegedly diverted from harbor improvements in order to meet general city expenses. In 1857 Parliament abolished local control and created a new agency, the Mersey Docks and Harbour Board

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(so named because Liverpool is on the River Mersey, four miles from the Ocean). Commercial interests were represented on the Mersey Board, as was the national government, but the city government was excluded. When the New Jersey Harbor Commission reviewed this experience in 1913–14, it learned that the members of the Mersey Board “receive no remuneration” and Liverpool’s “best commercial men” were glad to serve on the Board. (New Jersey Harbor Commission, 1914, pp. 95–97.) 13. In its 1914 report, the New Jersey Harbor Commission had criticized both New York City’s policy of “turning its dock revenue into the general city treasury” where it was used for “various local purposes,” and New Jersey’s policy of dedicating its waterfront revenues to the state’s school fund. “These moneys should . . . be used,” the Commission argued, to improve marine facilities, thus promoting business and the “wealth and prosperity” of the port region. (New Jersey Harbor Commission, 1914, p. 36; see also pp. 76 ff., and discussion of Liverpool port revenues in the note just above.) The bi-state study Commission took the same position; see the Red Book, 1920, pp. 84–87. 14. Under the constitutions of the two states, taxing power could be given to a government agency only if its top officials were elected by the citizens who would be subjected to the tax levy. A proposal for a special tax district might have generated substantial opposition from state and local officials. Moreover, elected officials of the district would be oriented to the immediate demands of their electorate, and therefore less willing to set policies whose benefits would be realized mainly in the long-run; also, they would be more likely to favor small changes spread around all parts of the region, even if major changes focused in a few portions of the region made better economic sense. In addition, the kind of people Cohen hoped to attract to direct the new agency—able commercial and civic leaders who would take the long view—would be less likely to accept if they had to run for office. 15. Under Article VI of the December 1918 draft, the Port Authority would be given “full power and authority” to “borrow money and secure the same by bonds or by mortgages upon any property held or to be held by it”; in an initial reading, the bonds as well as the mortgages appear to be secured by the Port Authority’s own property, but when you parse the sentence, the security for the bonds turns out to be unstated. Decades later, in commenting on this initial draft, Cohen made the point explicit: “The Authority could be authorized to borrow money upon the credit of the states to the extent that each state was willing to pledge its credit, or the states could authorize the corporate agency to borrow upon its own credit” (Cohen, 1946, p. 300). See also Article XIV, which reads: “Unless and until the revenues from operations conducted by the Port Authority are adequate to meet all expenditures, the legislatures of the two states shall appropriate, annually, for the expenses of the Port Authority, in equal amounts, such sum or sums as shall be recommended by the Port Authority and approved by the governors of the two states.” The reference to annual payments for expenses suggests that Article XIV refers to administrative expenses, but the phrasing appears also to embrace annual costs incurred for large port projects; if they were approved by the governors, the legislatures would be mandated to cover those expenditures. On the hope for profit-making port operations, see New Jersey Harbor Commission, 1914, pp. 36, 94 ff., 147, and Rush, 1920, p. 244. With the Panama Canal open (in 1914),

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and a shipping boom expected once the Great War ended, prospects for the major ports seemed especially strong. 16. Wiebe, 1967, pp. 167–168. 17. Woodrow Wilson, 1887, pp. 209, 213–214. Wilson wrote in the decade when the U.S. Civil Service Commission and the Interstate Commerce Commission were created as independent agencies which would be “nonpolitical” and apply sophisticated expertise to the business of government. 18. Brooklyn Daily Eagle, Dec. 22, 1918. Governor Whitman’s comments were made on Dec. 19, at a meeting to discuss the Port treaty. These are included, together with excerpts from other editorials and resolutions in support of the treaty, in New York State Chamber of Commerce, The Proposed New York-New Jersey Port Treaty and Central Port Authority Plan; A Resume of the Movement, 1919 (also available in the Port Authority library as DOC 19–1008). 19. The Chamber’s memorandum is quoted at length in Julius Henry Cohen, “Memorandum of Counsel . . . ,” Feb. 14, 1919, p. 8 (Port Authority library, DOC 19–1006). The New York Times, endorsing the treaty in late December, bypassed the difficult questions of democratic accountability; the treaty would simply permit “the quarreling couple” to “compose their differences and live in peace and greater prosperity than ever” (Dec. 24, 1918). For a brief summary of developments in 1919–1921, see Bard, 1942, pp. 28–34. 20. Hylan ran with backing from Tammany leader Charles Francis Murphy and Brooklyn Democratic leader John McCooey (who was credited with having “discovered” Hylan), and he won in a four-way race. Mitchel was turned out of office by the largest plurality in the City’s history; “Progressivism in the city,” Robert Caro concludes, was now “dead.” Hylan quickly laid down a set of rules which conveyed a tone he would follow resolutely during his years in office. “Officials and subordinates,” he announced, “must dispense with so-called efficiency experts” and they “must not loll in city automobiles with big cigars in their mouths.” Hylan proceeded to dismiss the experts—among them young Robert Moses—Mitchel had brought in to help make city government more efficient. In their place, he appointed friends and Tammany workers to positions high and low in the departments concerned with terminals, water supply, police, and civil service. (See Caro, Power Broker, 1974, p. 84ff., New York Times, Jan. 2 and 10, 1918 and “Plums for the Mayor’s Friends,” New York Times, April 21, 1918.) 21. Born in 1873—the same year as Cohen—Smith grew up on the Lower East Side of Manhattan, was active in neighborhood politics in the 1890s, and became an member of Tammany Hall, the Democratic organization in Manhattan. Elected to the state Assembly in 1903, Smith followed orders from the Democratic machine for several years. In 1911, however, he began to exert his independence, taking a leading role in the creation of a new state Department of Conservation and in devising new laws to protect factory workers. The Citizens Union, which had previously criticized Smith as a legislator who “voted and worked against the public interest,” by 1915 took a far more favorable view. In its report on state legislators that year, the civic group said of Al Smith: “Intelligent and forceful legislator. Strong supporter of desirable industrial and social legislation. Records of votes good.” These reports were prepared by the Citizens Union’s legislative committee,

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and Julius Henry Cohen served as chair or vice-chair of the committee during the years 1904–1921. [On Smith’s early career, see Norman Hapgood and Henry Moskowitz, Up From the City Streets: A Life of Alfred E. Smith (New York: Grosset and Dunlap, 1927), chapters 1–5; Alfred E. Smith, Up To Now (New York: Viking, 1929), chapters 3–9; and Oscar Handlin, Al Smith and His America (Boston: Little, Brown, 1958), chapters 1–4. The Citizens Union’s evaluation, and Cohen’s relationship with Smith, are discussed in Cohen, 1946, pp. 112 ff.; see also Hapgood and Moskowitz, 1927, pp. 132–136.] 22. Smith’s interest in these issues was strongly reinforced in early 1918, when winter weather caused a build-up of ice in the Hudson, and lighters carrying coal and other goods could not cross from the rail/ferry terminals in North Jersey. “Thousands of tons of coal were stored in the break-up yards in New Jersey,” Smith later recalled, “but we were unable to get it over to New York.” Smith concluded that major improvements were needed to prevent similar emergencies in future years; so he was inclined to give favorable attention to tunnels under the Hudson, as well as to broader plans to improve rail freight movement which the bi-state Commission had been discussing since 1917. (See Smith, 1929, p. 158; on Smith’s strong views in 1918 on the need for public action to improve the docks and terminal markets serving New York’s people, see Hapgood and Moskowitz, 1927, pp. 147–149.) 23. As a resident of South Jersey, Edge had long had a strong interest in a vehicular bridge across the Delaware River, connecting South Jersey and Philadelphia. But the state’s population was concentrated in the Northern counties, and their political leaders probably would not vote for state funding for a Delaware crossing unless a North Jersey crossing—over or under the Hudson—were also provided. A Hudson crossing would require cooperation from New York, and there was some doubt that New York City officials would eagerly support that project, since some of them were reluctant to devote state and local moneys to an enterprise they thought would mainly benefit New Jerseyans. So Smith’s strong support for a Hudson crossing seemed essential if Edge was to make significant progress on these major projects before leaving office. (See Edge, A Jerseyman’s Journal, 1948, pp. 91–96, and Cohen, 1946, p. 117.) 24. The Senate Commerce Committee had voted to disapprove the bill in December 1918, because its members were reluctant to set a precedent which might lead to federal funding of other tunnels and bridges across the country. See New York Times, Dec. 13, 1918. 25. As Cohen later recalled, he turned to Outerbridge during the extended discussion of the tunnel project and commented impatiently in a whisper, “It seems to me they are discussing the matter of one trouser button and buttonhole to save us from disgrace, while we are here to discuss an order for a whole suit of clothes” (Cohen, 1946, p. 261). A decade later the Holland Tunnel “buttonhole” would indeed save the Port Authority from [financial] disgrace. 26. Cohen’s later reflections capture the Cohen-Smith strategy at the meeting: “All the men in the room were practical men, especially the legislative leaders. These men . . . wanted not only to know how you got into this enterprise, but how you might get out of it. The first step was the one to be watched.. . . I wanted only to get concurrence in the simple plan of cooperation between the two states and the creation of an agency to bring it about. I knew

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the first step was the important one, and that if we got into too much detail, we should invite opposition from many quarters. . . . I argued, ‘This is like a constitution, the rest will come in the “by-laws.” You have nothing to risk now.’ All along the line, both states must agree in the legislation to follow.. . . Finally, Al said, ‘It gets down to this, boys. This is just the wedding ring, what happens afterwards we don’t have to talk about tonight.’ ” (Cohen, 1946, pp. 118–119; emphasis added.) 27. The commission included members of both houses of the legislature in Albany and in Trenton, representatives of the two governors, and officials from the two cities most directly affected, New York and Jersey City. The list of members, together with information on their activities, is in the Red Book, 1920, pp. 436–437 and 474–475. 28. During the meetings of the legislative commission, Cohen tried to find a compromise which would preserve a direct role for the Port Authority in controlling the development program. In his February 14 draft, for example, Article IX provided that no change in the Port development plan could be made “except by and with the approval of the Port Authority; or by and with the approval of the legislatures of both States.” (Port Authority library, DOC 19–1006; emphasis added.) 29. In the revised draft, the two states also reserved the right to provide at a later time for a veto power by either governor “over any action” of the Port Authority (Article XV). The draft by the legislative commission is included in the Red Book, 1920, pp. 475–477. 30. The concern of New York’s outer boroughs was illustrated by the lament of one Queens spokesman, who was fearful that a Hudson tunnel “will serve to draw industries from New York to the New Jersey meadows.” The Queens Borough president and its Chamber of Commerce strongly opposed the bi-state tunnel. (New York Times, April 6, 1919.) The many steps leading to the 1919 agreement are summarized in Bard, 1942, pp. 179–180. 31. In February, the New York State Chamber of Commerce released a report which indicated that the Port of New York’s percentage of U. S. foreign trade had dropped from 47 percent in 1913 to 44 percent in 1917 and then to 41 percent in 1918. In an editorial titled “National Port Dangers,” the New York Times expressed the widespread concern in commercial quarters about this trend and urged that the two states press ahead with cooperative action. (Feb. 15, 1919.) 32. Any further action, the letter continued, would be “dependent wholly upon the action and attitude” of City officials. (Letter dated March 11, 1919, from the president of the New York State Senate to Mayor Hylan and Robert Moran [president of the Board of Alderman]; reprinted in the Red Book, 1920, pp. 474–475.) 33. Comments made at the hearing are summarized in the New York Times, March 27, 1919 and in the Red Book, 1920, pp. 438–440. The Board of Estimate’s membership included the Mayor, the City Controller, the President of the Board of Aldermen, and the elected presidents of the five City Boroughs—Manhattan, Queens, the Bronx, Brooklyn, and Staten Island. During these years, a Democratic mayor elected with the support of Tammany Hall and its allies in Brooklyn would have a controlling voice in shaping Board policy. See Sayre and Kaufman, 1960, pp. 626 ff. 34. The Board of Estimate’s views, adopted by resolution on April 4, 1919, are included in the Red Book, 1920, pp. 477–479; see also pp. 437–438.

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35. The other two being John Purroy Mitchel as mayor of New York City and Charles Whitman as governor of New York State. Edge resigned on May 17 in order to take part in the special session of Congress called by President Wilson for May 19. Though Edge was gone, he was neither forgotten nor a permanent stranger. More than two decades later, he would regain the governorship, lead a battle to strengthen executive power and responsible government through a new State Constitution, and—as we will see in chapter 11—play an important part in releasing the yoke of banker conservatism which had descended on the Port Authority during the 1930s. 36. For the 1920 draft legislation, see the Red Book, 1920, pp. 480–483. 37. Red Book, p. 440. Cohen had drafted a paper which laid out the argument for transferring some local powers to a new regional body, but he did not send it to the Board of Estimate; instead it went to the Cornell Law Quarterly, which published the paper deep in its May 1920 issue. In Cohen’s view: 1. “The powers of a municipal corporation are subject to revision at the will of the state.” 2. “To form such a [regional] body . . . and to give it the authority . . . to make it effective, it will be necessary to withdraw from the existing municipalities some measure of the powers with which they are now endowed. . . .” 3. “The proposed Port District will include some sixty and more separate cities and towns, each existing under a charter declaring its right as an independent political body. How far will the existence of these interfere with the creation of a joint Port Authority? Not at all. A municipal corporation . . . [exists] solely as an agent of the state, organized, it is true, to make effective that principle of local self government which is the basis of our whole democracy . . . but nevertheless it is purely an agency. . . .” (Cohen, 1920, pp. 373–408, at 401.) 38. “The matter of Port development,” Smith said, “is critical. It affects housing problems; it affects the cost of living; it affects the cost of doing business . . . ; business is leaving New York because of inadequate facilities and rival ports are taking advantage of delays in the development of New York’s plans in order to strengthen their own position.” Smith pointed to Baltimore, Philadelphia and New Orleans as New York’s most dangerous competitors. (Special Message to the Legislature, March 29, 1920; reprinted in the Red Book, 1920, pp. 441–442.) 39. One of Hylan’s associates saw a worse disaster still: “If this bill goes through, there won’t be any port of New York. It will be the port of New Jersey and Newark Bay.” By the 1960s, some Brooklynites would find that description close to the truth. (New York Times, April 10 and 13, 1920.) 40. The Board favored having two or more elected officials of the city automatically named as Port Authority commissioners; these city leaders would form a majority of the New York State membership on the Port Authority Board. On the question of “local approval” for Port Authority plans, the Board of Estimate’s critique was not unsophisticated; the Board argued that the Port Authority could initially display a comprehensive plan for the region’s development that would be “so attractive and so promising” that it would readily receive the approval of state and local officials. But the Port Authority would then control the pace of action on various parts, perhaps post-

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poning some projects indefinitely. Moreover, once a city had accepted the Port Authority plan, there did not appear to be any way the city could withdraw its approval of projects within its territory, even if conditions changed. (The Board of Estimate memorandum is reprinted in full in the Red Book, 1920, pp. 490–494; emphasis added.) 41. “The greatest powers under democracy,” the Board argued, “are to be exercised only by those who are elected by and directly responsible to the people; and the worst evils” are those that arise when boards “not responsible to the electorate” act on important public issues. The Board listed several examples of its grievance, including the state’s Public Service Commission and the Bronx Parkway Commission, which had “imposed upon the City” excessive expenditures and other burdens with no way for City officials to restrain them. (Board of Estimate resolution, April 16, 1920, as reprinted in the Red Book, 1920, p. 492.) New York City’s complaint about independent commissions was an old one, and there was some merit to their concern. Municipal reformers in the 1850s, for example, noted that “the greater part of taxpayers’ money was spent by the state-appointed boards that administered municipal operations—the almshouse governors, the commissioners of asylums and police, the Croton Aqueduct Board, and the Central Park Commissioners.” (Amy Bridges, A City in the Republic: Antebellum New York and the Origins of Machine Politics [New York: Cambridge University Press, 1984], p. 35.) Upstate Republicans were viewed as having “trampled upon the sacredness of municipal independence” while their “vampires feed . . . upon our city treasury” (an 1857 account, as quoted in Bridges, 1984, p. 36). 42. In his critical review of the City’s position, Erwin Bard argues that the “fundamental, though unexpressed, objection” was that City officials would not be able to control the Port Authority, and therefore it could not use the Authority’s public-works projects and jobs “for partisan purposes” (Bard, 1942, pp. 31–32). While that motive was undoubtedly present, my own impression is the Hylan Administration’s attitude was motivated as much by several other, interrelated factors: (1.) New York’s citizens, and her elected officials, viewed the city’s harbor as a major source of economic strength and pride for the city, and any effort to cede control to an outside agency would be met with resistance. (2.) Business groups and elected officials in Queens and Staten Island were looking forward to additional projects along their waterfront areas—and to the boost in economic growth generated by those projects; a bi-state agency was less likely to give priority to their areas than a city agency. (3.) Hylan and his associates on the Board of Estimate would need voter support from those outlying boroughs when they ran for reelection in the fall of 1921; if the Hylan team were seen as the champion of economic development for the city and all its boroughs— and of local democracy—against the dangers of an alien force which could use the city’s resources to build up northern New Jersey, their reelection prospects might be enhanced. These themes are recurrent in newspaper articles in 1919, 1920 and 1921. (The Board of Estimate resolutions quoted in the text are in the Red Book, 1920, pp. 492–493.) 43. The Judiciary Committee hearing is summarized in the Red Book, 1920, p. 442; see also the New York Times, April 21, 1920. Also appearing with Hylan in opposition were City Comptroller Charles Craig and the new President of the Board of Alderman, Fiorello H. LaGuardia.

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44. The ties between Edwards and Hague were close: Edwards was a bank official in Jersey City and provided financial backing when Hague sought and won office as a Jersey City commissioner in 1913. When Edwards ran for the State Senate in 1918, Hague produced large Democratic pluralities in Jersey City, ensuring victory. Hague then devised a strategy to win the gubernatorial nomination for Edwards in 1919, and Edwards’ victory over other primary candidates established Hague as the state-wide leader of “the New Jersey Democracy.” See Dayton D. McKean, The Boss: the Hague Machine in Action (Boston: Houghton Mifflin, 1940); Richard J. Connors, A Cycle of Power (Metuchen, NJ: Scarecrow Press, 1971); Steven P. Erie, Rainbow’s End (Berkeley: University of California Press, 1988), pp. 68–73, 122–123. 45. “On behalf of this very Chamber,” Ferguson recalled, “I did all I could to prevent the creation of the Port Authority.” Ferguson, a prominent banker in Jersey City, later served for 20 years as a member of the Port Authority board and as its chairman for ten years. (See Frank C. Ferguson, “The Port Authority,” January 16, 1935 [Port Authority library, DOC 35–1007]; Cohen, 1946, p. 293; and chapters 8–11 below.) 46. Edwards also said that he objected to the requirement—which had been added after New York City’s criticisms the previous year—that no city would be bound by the Port Authority’s plans until it had expressed its approval. “Either the authority should be created with full and complete power,” Edwards argued, “and authorized to function as a vigorous and virile body, or not at all.” (An effort to give the Port Authority “full and complete power” within the Port District would increase opposition to creating the agency, so it is probable that “not at all” was Edwards’ strong preference.) His veto message is reprinted in the Red Book, 1920, p. 442. 47. New York Times, editorial, April 24, 1920. “Faint heart . . . ” is from Cervantes, Don Quixote, part III. 48. Cohen’s speech is reported in the New York Times, Oct. 22, 1920. In the previous months, the Times had carried articles describing the diversion of export freight to Philadelphia, Baltimore, and other harbors. One article, carrying the headline, “Peril of Port of New York: Freight Congestion Due to Inadequate Facilities and the Failure of Plans to Remedy the Evil,” pointed out that essentially no funds had been spent in the New York region on freight facilities in the past 25 years, while $700 million had been spent for rail passenger projects ($400 million for New York City’s subways, and $300 million for railroad terminals in Manhattan and other private rail improvements). The writer noted that by 1920 it cost more to move many goods a few miles within the New York region than to move them from Chicago to New York. In July, the latest figures for foreign trade were released, showing that New York’s percentage of export traffic had declined for yet another year. (See New York Times, May 18, 19, July 2, 1920.) 49. In New Jersey, the term for governor was three years (with elections in the fall of 1919, 1922, etc), and a sitting governor could not immediately succeed himself; in 1947, the term was changed to four years, with two consecutive terms permitted. 50. See Cohen, 1946, p. 303. 51. I. e., the Red Book, which carries a letter of transmittal to the two governors dated December 16, 1920. It was not printed and distributed until the end of January. 52. The quotations are from the Red Book, pp. 36–37.

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53. See for example the New York Times, Feb. 3, and Feb. 6—which conveys Smith’s message in the article’s headlines: “Proposes Campaign to Develop Port: Former Governor Smith Asks Concerted Drive by Business Organizations; Decries State Rivalries.” See also the extended feature article in the Times, Feb. 13, which is based on information provided by Cohen and his associates on the Commission. 54. As the New York Times commented, the Hylan Administration “is suffering so severely in prestige that its opposition to anything is almost all that is necessary to rally both the judicious and the majority” to support new proposals (February 18, 1921). Cohen later recalled that the “persistent and personal attacks” by Hylan, combined with Tammany opposition generally, helped to garner approval for an independent Port Authority from Republicans in both states and from the metropolitan press. Hylan was “one of our really great aids.” (Cohen, 1946, pp. 292, 293.) 55. New York Times, Feb. 17, March 14, 16, 18, 1921. Speaking about the Transit Commission bill but in terms that apply more broadly, one Democratic state senator argued, “There is not much difference between the Lenin and Trotsky idea of self-government and that which emanates from Albany. Both kinds believe in home rule and local self-government . . . administered by themselves and not by the people affected.” (New York Times, March 18, 1921.) 56. New York Times, March 16, 1921. Compare Cohen’s arguments in the Cornell Law Quarterly, quoted earlier in this chapter. 57. See New York Times, March 29, 1921 and Bard, 1942, pp. 32–33. The three New Jersey officials named to the Port Authority Board were J. Spencer Smith, Frank R. Ford, and DeWitt Van Buskirk. 58. See Cohen, 1946, pp. 297–298, and Smith, 1929, p. 225. After leaving the State House in January, Smith had returned to New York City, where he was an officer of the United States Trucking Company. 59. Their interest had been absorbed in a court suit brought by the Hylan Administration, alleging that the Port Compact was unconstitutional because it took away rights reserved to New York City and gave them to New Jersey. The suit was thrown out of court on April 29. See New York Times, April 30, 1921; Bard, 1946, p. 34; and Joseph Lesser, “Great Legal Cases Which Have Shaped the Port Authority,” Port Authority Review, 7 (1969), pp. 6–7. 60. The Port District boundaries are shown in Map 3-1. The Port Compact is reproduced in part in the Appendix. 61. “We became a sort of Halloween spectre to the municipal officials. . .. Like the witch in ‘Hansel and Gretel,’ we were ready to capture all the little children. . . . New York’s valuable piers and waterfronts and railroads . . . would surely be gobbled up!” Cohen, 1946, pp. 291–292. 62. Hylan’s unremitting opposition to the Port Authority concept appears to have been a significant factor in persuading Smith that Hylan lacked the vision and competence to hold important public office. See Hapgood and Moskowitz, 1926, pp. 144–147, 207–210. 63. For a sample of these criticisms, mainly directed toward Hylan and his associates, see the New York Times, Feb. 17, 18, March 16, 25, April 7, Oct. 26, Nov. 3, 7 and 9; “Hylan’s Hold on New York,” Literary Digest, Nov. 19, 1921; “Hylan: A Symbol,” New

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Republic, Nov. 23, 1921; William Bullock, “Hylan,” American Mercury, April 24, 1924, pp. 444–449. 64. Julius Henry Cohen, “Developing Port Facilities by Interstate Compact and Agencies,” American Bar Association, August 30, 1921, pp. 13–15.

Chapter 4 1. Hays, Conservation and the Gospel of Efficiency, 1969, p. vii. 2. Hays occasionally tends to characterize the difference in that way, referring for example to “the thrust of modernization and the resulting tension between centralizing and decentralizing forces.” (Hays, 1969, p. vi; emphasis added.) 3. The Port Authority’s general mission is described in the opening paragraphs of the bi-state Compact of April 1921, which also refers to the need for new physical plans and “large sums” for capital investments. (See the Compact, reproduced in part in the Appendix.) The requirement that the Port Authority produce a “comprehensive plan for the development of the port district” is set down in accompanying legislation signed in April 1921. 4. In the words of the Port Authority: “There should be consolidation of shipments at proper classification points so as to eliminate duplication of effort, inefficient loading of equipment and realize reduction in expenses;” and “there should be the most direct routing of all commodities so as to avoid centers of congestion, conflicting currents and long truck-hauls.” Report with Plan for the Comprehensive Development of the Port of New York, Dec. 21, 1921, p. 11. 5. As noted in Chapter 2, most railroads brought their freight trains to docks along the New Jersey shore, and then floated the goods—using more than 100 tugboats and more than 1000 lighters—across the River and New York Bay to Manhattan and Brooklyn piers. This was a slow process, and costly, since freight often had to be repackaged manually when transferred to and from lighters (large, flat-bottom barges); and it was hazardous too, especially when the boats encountered ice and winter storms. Independent experts generally reached similar conclusions regarding weaknesses in the region’s freight system and principles of reform. See for example MacElwee, Ports and Terminal Facilities, 1918, esp. chapter 6; William J. Wilgus, “Terminal Wastefulness at New York,” Scientific American Monthly, 2 (1920), pp. 61–65. 6. Hylan had been elected mayor of New York City in November, 1917, and he led the opposition to creation of the Port Authority during his first term. Re-elected to a second four-year term in 1921, Hylan continued his attacks on the bi-state agency, accusing it of scheming to shift New York’s marine industry to Newark Bay and Jersey City. (See chapter 2 ; Bard, Port of New York Authority 1942, pp. 50–53.) In the 1925 primary, Hylan was again a candidate for mayor, but Al Smith gave his strong support to Jimmy Walker, who defeated Hylan and then won the general election, becoming mayor in 1926. As Smith was an enthusiastic supporter of the Port Authority, he was dismayed by Hylan’s inability to grasp the advantages of that agency and its regional plan. In 1923, for example, shortly after being re-elected as governor, Smith invited Hylan and other members of the city’s Board of Estimate to dinner and outlined the arguments

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for the bi-state agency. Hylan’s response was to take Smith to a separate room where he said: “Look here, Al, what’s the use of our fooling with New Jersey in this matter? Let us get up a Port Authority of our own. If you don’t want to go back to Albany, I’ll appoint you commissioner with a big salary.” Smith reported Hylan’s offer, and his own displeasure at Hylan’s limited understanding of the issue, to Hapgood and Moskowitz, his friends and biographers; see their book, Up from the City Streets: A Life of Alfred E. Smith, 1927, pp. 146–147 (also pp. 144– 145 and 207–210). For a thoughtful discussion of the Narrows Tunnel project and its potential benefits to the region, see David A. Johnson, Planning the Great Metropolis: The 1929 Regional Plan of New York and Its Environs (London: Chapman and Hall, 1996), pp. 202–212. 7. The latter-day campaign for a rail-freight tunnel began in 1979, when Representative Jerrold Nadler, whose district includes portions of Brooklyn, urged that the 1920 proposal for a rail-freight tunnel between Brooklyn and the nation’s railroad lines in New Jersey be revived. It became more visible in the 1990s, when New York City’s mayor, Rudolph Giuliani, embraced the idea. One version of the plan would involve a tunnel between Bay Ridge in Brooklyn and the northern tip of Staten Island, where the railroad would connect to surface rail lines that continue west over the Arthur Kill waters to New Jersey; this is similar to Hylan’s Narrows Tunnel plan. Another would require a longer tunnel, from Brooklyn to Jersey City, where it would connect to the national rail network; this follows the Port Authority’s preferred 1921 plan, described below. For recent commentary, see “Giuliani Proposes Rail Tunnel to Carry Freight Past Hudson,” New York Times, Jan. 15, 1997, and “A Tunnel to the Future,” editorial, New York Times, Jan. 18, 1997, in which the Times’ editorial writers waxed enthusiastic about a rail tunnel from Brooklyn. Referring to the efforts of New York’s Mayor Giuliani and Governor George Pataki, the editorial concluded that “if this project succeeds,” the two officials “will be remembered among the city’s great politician-builders.” 8. See Map 4-2 and the sketch of the bridge in the photo insert. Enroute to the bridge, the nation’s railroads would pass through a large rail yard in the New Jersey Meadows; there freight consigned for stores within New York City could be transferred to motor trucks, which would cross over the bridge and make direct deliveries. (The 57th Street Bridge plan is described in the Scientific American, April 23, June 4 and June 25, 1921.) 9. The Pennsylvania Railroad had been a supporter of the Lindenthal bridge at 23rd Street, when it was under active discussion in the 1890s. However, the Erie, the Susquehanna, and other railroads were reluctant to agree to a joint project; the Pennsylvania then decided to act alone, dug a tunnel under the Hudson, and in 1910 opened that tunnel and Pennsylvania Station (at 33rd Street in Manhattan) to passenger traffic. Its direct rail access to Manhattan generated some interest in a joint crossing among its jealous competitors. The New York Central also had direct access to Manhattan via its line from Chicago, which crossed the Hudson at Albany and then traveled south to Manhattan. 10. The quotations in the text are from Eugenius H. Outerbridge, Chairman, Port of New York Authority, “The Hudson River Bridge and Highway Development,” Dec. 8, 1921, pp. 4, 5. The 57th Street Bridge still had some support throughout the 1920s, and its

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advocates continued sporadic campaigns into the mid-1930s. See Gustav Lindenthal, “Memorandum” [on the report of the bi-state study commission], February 25, 1921; “The Hudson River Bridge,” Scientific American, April 23, 1921, pp. 324 ff.; Port of New York Authority, Report . . . , Dec. 21, 1921, pp. 18–19; Port of New York Authority, “The Fifty-Seventh Street Bridge,” January 1936; Rebecca Read Shanor, The City That Never Was (New York: Viking, 1988), pp. 135–149; Johnson, 1996, pp. 212–224. 11. The discussion in this section is based on the issues and debates described in chapter 2. 12. The quotations in the text are from the 1914 report (p. 28) of the New Jersey Harbor Commission, which was the first state agency to sketch out the plan described in this section. When the New York Times attacked Mayor Hylan’s Narrows Tunnel project and his general antipathy to cooperation with New Jersey, it inadvertently captured an important part of the argument for a “New Jersey plan”: “Compare, for example, the pictures and maps of the Port of Newark and the New York City port. It is plain that Newark has the railways in greater completeness than New York has the ships. . . . Newark is a completer economic unit than the city, because Newark—the port, not the city—has better access to deep water than New York City has to the railways across the Hudson” (editorial, Jan. 3, 1922). 13. See New York Harbor Case, 47 ICC 643 ff., and discussion in chapter 2. The New York Chamber of Commerce also seemed to endorse the attractions of the New Jersey plan, though couched in unfriendly terms: “ . . . Without a comprehensive joint development of the Port, New Jersey is likely to secure a preference in railroad rates. It is thought by many authorities that should New Jersey proceed alone in developing her portion of the harbor New York would not be successful [in keeping New Jersey from obtaining lower rail rates]. . . . If the Port Authority plan does not succeed, there is every reason to believe that some day the New Jersey cities will be able to secure a differential . . . [placing New York] at a serious economic disadvantage. . . . ” (Chamber of Commerce of the State of New York, “The Plan of the Port Authority of New York for Future Port Development,” January 1922, p. 7; emphasis added. The mistitling of the bi-state agency is perhaps a Freudian slip.) 14. Another major advantage of Newark and Elizabeth marine terminals is the availability of extensive space near the piers, where freight can be marshaled for loading, and stored. With the advent and spread of containerization during the 1960s and 1970s, large amounts of such “upland” space became a crucial factor, and docks—such as those of Manhattan and Brooklyn—which were hemmed in by highways and buildings could no longer serve most marine traffic efficiently. 15. Showing its rational-planning colors, the agency explained that it “had to consider the interests of the whole port, as well as the relations of each part. It had to . . . project larger plans for future development as far ahead as the process of reasoning could foresee, so that each part of the port in the development of its local projects and its growth might properly coordinate them with the whole.” Port of New York Authority, Report with Plan . . . , Dec. 21, 1921, p. 14. 16. The experience of Walter Hedden is illustrative. Hedden joined the Port Authority in the early 1920s, became an expert on food distribution problems in the New York re-

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gion, and served as the agency’s chief planner in the 1930s and 1940s. When World War II broke out, he commented to his assistant, Roger Gilman: “At last, we may get the federal funds we need to proceed with the Comprehensive Plan!” (Roger H. Gilman, interview, Jan. 20, 1988.) Erwin Bard’s book includes a large fold-out map of the Comprehensive Plan, updated by the Port Authority to 1942; Bard reports that the primary rail belt lines and the cross-Bay railroad tunnel were still viewed as “practicable and necessary.” (Bard, 1942, p. 350.) 17. The bi-state study commission had examined the issue of whether a bridge or tunnel across the Hudson could be justified as a way to bring freight into Manhattan by motor truck, and decided in the negative. The commission “has analyzed the highest [possible] development of motor-truck service,” its final report concluded, and “we have seen that the existing ferries, without either bridge or vehicular tunnel, could handle the entire Manhattan tonnage” which would be carried by motor trucks (Red Book, 1920, p. 243). 18. E. H. Outerbridge, “The Hudson River Bridge and Highway Development,” Dec. 8, 1921, p. 8. 19. Funds would also be needed for Belt No. 1—to construct about 10 miles of entirely new track, and to upgrade the existing 51 miles of trackage. 20. The entire system of lines is described in the Port Authority’s Report with Plan.., Dec. 21, 1921, pp. 27–32. 21. See ibid., pp. 20–21, 33–35. The entire system would handle outward bound freight as well, of course. 22. Ibid., pp. 20–21. The bi-state agency also recommended unified trucking services, especially in Manhattan, to improve freight distribution from rail and lighter terminals. 23. As Josef W. Konvitz points out, the plans of the study commission and the Port Authority were almost certainly influenced by the earlier work of William J. Wilgus, a well known engineer. In 1908–1910, Wilgus had put forth a series of proposals—including an underground freight railroad between New Jersey and Manhattan, regional belt lines, and an interstate commission to take control of port development—which anticipated the general direction the later commissions would take. (Konvitz, “William J. Wilgus and Engineering Projects to Improve the Port of New York, 1900–1930,” Technology and Culture, 30 [1989], pp. 398–425.) One of Wilgus’s proposals is cited in the 1920 Red Book (pp. 217–218), but otherwise his influence on their thinking is not recorded. As noted earlier in this chapter, one of his proposals—which featured a railroad tunnel under the Narrows to Brooklyn—was embraced by Mayor Hylan in the early 1920s. 24. In the Port Authority’s December 1921 report on the various routes, Belts No. 2, 3, 6, 7, 8, 9, 10, 11, 12, 13, 14 and 15 are described in this hopeful way. Thus only Belts 1, 4, 5, and 16 escape. 25. Succumbing to optimism and perhaps to naivete, the New York Times commented, in endorsing the Comprehensive Plan, that one of its great merits was, “It calls for no expenditure of tax money; the plan will be carried out altogether with private funds.” (Editorial, Jan. 1, 1922.) 26. Port of New York Authority, Report with Plan . . . , Dec. 21, 1921, p. 22. 27. Under Article VI of the 1921 Compact, the Port Authority was given “full power and authority to purchase, construct, lease and/or operate any terminal or transportation

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facility” within the Port District, to levy charges for use of its properties, and to borrow money and issue bonds, secured by its properties. However, the second paragraph of this article states that “the powers granted in this article shall not be exercised by the port authority until the legislatures of both states shall have approved of a comprehensive plan for the development of the port. . . . ” A deadline of January 1, 1922 for submitting the Comprehensive Plan was set by separate legislation passed in April 1921 (Laws of N.J., chapter 152; Laws of N.Y., chapter 203). 28. The Port Authority created an advisory committee of business and civic associations, identified 114 organizations from all parts of the region which should be included on the committee, and held several meetings with the entire committee and separate meetings with groups of New Jersey associations. As Bard comments, “for the most part the suggestions that were received in these meetings concerned the extension of belt lines to reach particular localities. The New Jersey groups emphasized the development of Newark Bay and the Long Island groups urged the development of Jamaica Bay.” The Port agency listened to their demands and generally responded by “accepting their proposals.” By the end of the process of consultation, “a belt line had been drawn wherever one was demanded.” (Bard, 1942, pp. 48–49.) 29. The Authority’s proposals were endorsed by the Brooklyn Eagle (Dec. 19, 1921) and the Brooklyn Times (Dec. 30, 1921), and by the Brooklyn Chamber of Commerce and the Staten Island Chamber of Commerce (which, however, said it preferred the Narrows Tunnel for the belt-line connections from New Jersey to Brooklyn). The Brooklyn Times commented that “the problem is much larger than any rivalry between Jamaica Bay and Newark Bay” and requires “the best thought of the community,” which had now “succeeded in building up a plan. . . .” “The initiative lies with the Port Authority,” the Brooklyn paper concluded; “the immediate duty is to support the plans of that Authority” (editorial, Dec. 30, 1921). In endorsing the Port Authority’s plans, the New York Times embraced what its editors viewed as a “national” perspective: “The problem from a national point of view is to bring together the rail and steamship terminals in such a manner as to serve most economically and efficiently both the land and water carriers and the nation’s largest market. No plan designed to serve particularly any borough or any city can compare with that national service.” (Editorial, Dec. 1, 1921.) 30. These negotiations are described in Julius Henry Cohen, “Developing Port Facilities by Interstate Compact and Agencies,” August 30, 1921, pp. 12, 14–15; Cohen, “Developing the Port of New York,” Dec. 6, 1922, pp. 11–12 (both in Port Authority library); and Bard, 1942, pp. 44–45. 31. Edwards’ veto in the spring of 1921 had been overridden by the Republican-dominated legislature. (See discussion in chapter 3.) When he reviewed the Comprehensive Plan, Edwards commented: “While I opposed the creation of this body, believing that the interest of New Jersey lay in working out alone the development of its resources, it is my personal opinion, from an examination of the report and plan, that the Commissioners of the Port have dealt justly by this State and that the plan should be approved.” (New York Times, Jan. 11, 1922.)

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32. Twenty major business and civic groups in New York City endorsed the Plan, and another twenty from other parts of the state went on record in supporting the program. (See Chamber of Commerce of the State of New York, “The Plan of the Port Authority of New York for Future Port Development,” January 1922, which lists the organizations and reprints a sample of favorable editorials.) 33. In Hylan’s view, the Port Authority’s designs, like those of its predecessor study commission, “sought to develop the Hackensack Meadows and Newark Bay at the expense of the City of New York.” (Address of the Mayor, Jan. 2, 1922, reprinted in the New York Times, Jan. 3, 1922.) Moreover, “the existence of this Port Authority,” Hylan argued, “again demonstrates the danger of having Albany create boards, commissions and bodies not responsible to the people. . . . The responsible municipal officials cannot plan and execute constructive measures in the interests of the people if the policy of legislative obstruction is to be continued.” (New York Times, Jan. 3, 1922.) The issue of democracy was also pressed by other city officials, as they fought against the Port Authority and its proposals. Murray Hulbert, president of the Board of Aldermen (and once a member of the bi-state study commission) doubted that “three men over in New Jersey sitting with three men in New York” should decide the destinies of New York communities; far better “to have it done by the eight members of the Board of Estimate, who are elected by and are responsible to the people of the City of New York.” The city’s corporation counsel, John P. O’Brien, saw the Port Authority as a “great octopus” whose tentacles would be cast around “the property rights and the liberties” of local citizens; and he urged that the city government be given a veto power over the Comprehensive Plan, as well as the right to name two of New York State’s three commissioners on the Port Authority board. (Board of Estimate of New York City, Public Hearing, Jan. 26, 1922, pp. 17 and 119–120.) 34. The New York Times, for example, favored giving the city government the power to name commissioners to the Port Authority. But it argued that the city should be given that role only “when it becomes clear that the City Administration has given up its hostility to the Port Authority plan . . ., when it has shown willingness to cooperate cordially, and when it can be trusted to appoint Commissioners for their ability, integrity and competence, and not for their political value or in the mere hope of patronage.” (Editorial, Feb. 3, 1922.) See also the observations of Governor Nathan L. Miller on the city’s “destructive” approach (message to the legislature, recommending approval of the Comprehensive Plan, Jan. 16, 1922), and the comments in Bard, 1942, p. 61, and in Julius Henry Cohen, They Builded Better Than They Knew, 1946, pp. 292–293. 35. The headlines in the New York Times capture the spirit of the occasion. Smith spoke at a hearing on January 31, and the February 1 headlines read: “Ex-Gov. Smith Lauds Port Project Bill; Rejects Hylan Plan/His Break with Tammany.” On Sunday, February 12, the Times carried a special feature story under the following heading: “ ‘Al’ Smith’s Triumph: His Speech on Port Authority Analyzed by an Engineer Who Heard It—An Event in Politics.” (See also Cohen, 1946, pp. 296–97.)

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36. For a spirited analysis from this perspective, see Cohen, “The New York Harbor Problem and Its Legal Aspects,” 1920, pp. 373–408.

Chapter 5 1. Port of New York Authority, Annual Report, Jan. 19, 1924, p. 38. 2. Croly, The Promise of American Life, 1909, pp. 359, 362. 3. This has been the dominant interpretation of the reasons for the Authority’s shift from rails to rubber. For example, Erwin Bard writes that “within the Port Authority the center of gravity began shifting to vehicular traffic. . . . Hopes for railroad cooperation were fading; the attempt to use coercive pressure was gaining no ground. Negotiations for the Hoboken Shore Line collapsed early in 1926. The ‘do-something’ policy in terms of construction was rising. It was imperative that the Port Authority’s credit . . . be established. The bridge-building program offered a chance” (Bard, Port of New York Authority, 1942, p. 185). Cam Cavanaugh puts it this way: “The new Port Authority attempted persuasion first, then coercion, but to no avail. Badly stung, the agency turned its back on railroad transportation and looked for friendlier, more profitable ventures” (Cavanaugh, Saving the Great Swamp [Frenchtown, NJ: Columbia Publishing Co., 1978], p. 72). And Herbert Kaufman: “I always cite the Port Authority as a classic case (the other being the National Foundation for Infantile Paralysis) of switching proclaimed missions in the interest of organizational survival, the paramount value. It went from promoting the unification of rail service in the port to a host of activities that helped diminish use of the railroads. The change might have occurred anyway, but that’s beside the point; the Authority changed sides to protect its own existence. Most organizations would do the same.” (Kaufman, letter to the author, Oct. 5, 1990.) 4. At a meeting in Albany in 1919, Cohen had contrasted the Holland Tunnel project to the Comprehensive Plan in this way: the first was a question of providing “one trouser button and buttonhole,” while the Plan was “an order for a whole new suit of clothes” (Cohen, They Builded Better Than They Knew, 1946, p. 261). With this analogy, the George Washington Bridge would provide a second button and buttonhole, while the set of three Staten Island crossings might offer an equally modest alteration in the region’s clothing. 5. “Pollution cannot well be prevented or regulated by the independent action of forty municipalities. . . . The Commission . . . believes the Port Authority should be vested with jurisdiction over all forms of harbor pollution.” (New York, New Jersey Port and Harbor Development Commission, Joint Report . . . , 1920, p. 34; hereafter cited as the Red Book.) 6. Section 4 of the Comprehensive Plan reads as follows: “4. Manhattan service. The island of Manhattan to be connected with New Jersey by bridge or tunnel, or both, and freight destined to and from Manhattan to be carried underground, so far as practicable, by such system, automatic electric as hereinafter described or otherwise, as will furnish the most expeditious, economical and practical transportation of freight, especially meat, produce, milk and other commodities comprising the daily needs of the people.” [The section then turns to the need for “suitable

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markets” and warehouses, and for connections of “the said system” to “all the transcontinental railroads. . . . ”] The reference to Section 4 occurs in the two Staten Island bills, approved by both legislatures in 1924, and in the George Washington statute, passed early in 1925. The 1926 bill authorizing the Bayonne Bridge cites the Comprehensive Plan but is silent on the relevance of Section 4. 7. J. H. Cohen, “Accomplishments and Plans of the Port of New York Authority,” address before the American Association of Port Authorities, October 6, 1927, p. 7 (Port Authority library). 8. See for example the Red Book, 1920, pp. 46 ff.; Christine M. Rosen, The Limits of Power (New York: Cambridge University Press, 1989), pp. 127 ff.; D. Philip Locklin, Economics of Transportation (Homewood, IL: Irwin, 1966), chapter 12 and passim. 9. See the analysis in Port Authority, Annual Report, Jan. 24, 1925; and discussion in Chapter 2 above. 10. “In the past, provisions for the terminal handling of this vast commerce have been developed as the pressure of necessity and the expediency of the moment required. . . . When terminal facilities at one point became saturated . . . new and additional points for terminals had to be sought . . . at high cost, and without relation or coordination with other units. Under the individual systems of twelve trunk railroads many such facilities and locations had to be duplicated.” (Port of New York Authority, Report with Plan . . . , Dec. 21, 1921, p. 10.) 11. Ibid., pp. 11–14, 21–22. 12. Ibid., Dec. 21, 1921, p. 22; emphasis added. 13. On railway competition and the ICC in those decades, see Theodore E. Keeler, Railroads, Freight, and Public Policy (Washington, D.C.: Brookings, 1983), chapter 2, and Locklin, 1966, chapters 15 ff.; also, the reflections of Clifford O’Hara, a salesman for the Pennsylvania Railroad before and after World War II (letters to the author, July 24, 1993 and June 29, 1998). 14. See chapter 4. 15. The 1917 ICC decision pointed out that much of the nation’s international trade flowed through New York, cited the high costs and delays in freight movement in the New York region, noted that these inefficiencies might place an “unjustifiable burden upon the people of the whole country,” and warned that the ICC might in time require lower rates on the New Jersey side of the harbor if regional leaders did not find an alternative way to improve freight handling in the bi-state area. (New York Harbor Case, 47 ICC 643ff; and see chapter 2 above.) 16. For the “cat and mouse” image of these years, I am indebted to Samuel Moerman, a Washington lawyer involved in Port Authority and railroad matters from the 1930s into the 1980s (interview by the author, October 29, 1990). The image may not capture the complex power relationships in the early 1920s, however; as the text below suggests, the Port Authority for a few years thought it had the potential to control the railroad cat, but the cat adroitly evaded that threat till it was no more. For a much more detailed treatment of the Port Authority’s railroad negotiations, see Bard, 1942, pp. 63–173. Large parts of his careful analysis are organized in terms of indi-

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vidual rail projects, as each evolved through several years (Belt Line 13; the Hell Gate case; the effort to acquire the Hoboken Railroad; etc); this has the advantage of providing an extensive review of developments within each area. This benefit is purchased at some cost, however, for the reader obtains little sense of the pressures of time under which many issues and negotiations were being pursued simultaneously by Cohen and his colleagues. The discussion below is organized to convey an impression of how these multiple pressures and possibilities were experienced by the participants at each stage. As a result, we can also appreciate the weaknesses in the standard interpretation of the Port Authority’s evolution—an interpretation constructed around the argument that the agency’s leaders had a clear realization by the mid-1920s that its railroad plans were doomed to failure, and that they then abandoned them to embrace the lucrative field of automotive transportation. 17. Earlier (in December 1921), the railroads had indicated that they could accept the Port Authority’s principles for port development. At the time, they appeared to be agreeing that “terminal operations . . . should be unified,” that efforts at coordination should “adapt existing facilities as integral parts of the new system,” and that “duplication of effort” should be eliminated. However, before the rail executives formally endorsed those principles, they insisted that the Port Authority preface them all with the condition, “so far as economically practicable”; and the Port Authority had, in mid-December, agreed to do so. Then, during the 1922 negotiations, the railroads argued that the Port agency’s plans would involve large and unnecessary capital expenditures and would reduce management discretion in seeking the best profit position for each railroad—thus violating the standard of economic practicality! (Port Authority, Report with Plan . . . , Dec. 21, 1921, pp. 11–12; Bard, 1942, pp. 63–66.) 18. On November 23, 1922, for example, business leaders in Jersey City heard Commissioner De Witt Van Buskirk describe the transport inefficiencies and high costs that burdened commerce in the region. “It is hoped that the railroads may see the light of day,” he argued; “if not, steps must be taken to impress upon them more emphatically” that reforms were essential. In early December, Commissioner Alfred E. Smith spoke in Manhattan on the “absolute lack of co-operation on the part of the railroads” and argued that the force of the ICC might have to be used to carry out the Plan. (“Says Roads Block Port Unification,” New York Times, Nov. 24, 1922; “Insists City Share in Port Authority . . . Lays Delay to Railroads,” New York Times, Dec. 9, 1922.) The quotations in the text are, respectively, from Bard, 1942, p. 66, and J. H. Cohen, “Developing the Port of New York,” Dec. 6, 1922, p. 8 (Port Authority library). For the appeal to the ICC, see Port Authority, Minutes, Nov. 8, 1922. 19. The railroad quotations are from the ICC stenographers’ minutes, as quoted in Bard, 1942, pp. 71–72. In criticizing railroad practice, the Port Authority staff noted that each railroad published rates for “circuitous routings which would give each the longest practicable haul on their own lines. . . . In some cases cars traveled 187.5 miles instead of . . . 42.5 miles [via a direct route], consuming five days en route; other shipments traveled 115 miles instead of . . . eight miles, four days being consumed en route.” (The quotations are from the Port Authority’s summary of staff testimony, included in its Annual Report, Jan. 19, 1924, p. 14.)

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20. Railroads across the nation had long resisted sharing their individual terminal facilities, and until the 1920 Transportation Act, the ICC had no authority to compel cooperative use of terminals in order to improve service to shippers or promote efficiency. The 1920 Act added a new paragraph which appeared to strengthen ICC powers: “If the Commission finds it to be in the public interest and to be practicable, without substantially impairing the ability of a carrier owning . . . terminal facilities to handle its own business, it shall have the power to require the use of any such terminal facilities, including main-line track or tracks for a reasonable distance outside of such terminal, by another carrier or other carriers.” (sec. 3, para. [4]; emphasis added.) In its 1922 Hastings decision, the ICC concluded that while Congress “had formerly safeguarded the carrier in the exclusive use of its terminals, it now [in the 1920 Act] recognized that there is a broader interest than that of the individual carrier . . . , that of the public. The object of the statute was to make more flexible the use of existing terminal facilities.” (Hastings Commercial Club v. C. M. & St. P. Ry. Co, 69 ICC 489.) On the 1920 Act, the traditional problem of joint terminal use, and the Hastings case, see I. L. Sharfman, The Interstate Commerce Commission, Part 3, vol. A [New York: The Commonwealth Fund, 1935], pp. 411–430. 21. The summary and the quoted railroad statement are found in the Port Authority’s Annual Report, Jan. 19, 1924, pp. 15–16; see also pp. 6–7 and Bard, 1942, pp. 72–73. 22. The national government had acquired the Hoboken Railroad, a 1.2 mile spur near piers on the Hudson River, as part of its troop embarkation plans at Hoboken during the First World War. The proposal to buy the line produced sharp debate and a divided vote, with dissenters arguing that the Port Authority should not try to run a railroad. See Port Authority, Minutes, October 24, 1923; Port Authority, Annual Report, Jan. 19, 1924, pp. 14–16, 25–32; Bard, 1942, pp. 68–71, 140–144. 23. See Port Authority, Annual Report, January 1924, pp. 18–21, 35–36, 47. In order to reduce wagon and motor-truck congestion in Manhattan, the Port agency planned to create inland terminals, which would be huge buildings where freight from all railroads could be received, and then sorted by area of destination within Manhattan. The sorted freight could then be packed efficiently on trucks bound for specific locations, thus replacing the cross-cutting paths and half-full trucks that spread out from individual railroad piers and terminals. 24. The agency’s chairman, Eugenius H. Outerbridge, made the point clear in 1921, when he explained why the Port Authority was not including recommendations regarding vehicular traffic in its Comprehensive Plan: The Port agency had been “directed to prepare and present to the Legislatures of the two States a comprehensive Bi-State plan for freight movements. . . . ” It had “neither the time nor the means” to study “vehicular and [rail] passenger transportation and these were outside the scope of its functions as defined in the legislation.” Outerbridge then referred to state policy which placed “construction of vehicular tunnels” in the hands of the Joint Commissions then working on the Holland tube, and he conjectured that in time a vehicular bridge over the Hudson would be built, which—following the precedent of the East River spans—would become a “free passageway.” (Outerbridge, “The Hudson River Bridge and Highway Development,” Dec. 8, 1921, p. 7 [Port Authority library].)

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25. The “Holland Tunnel” commissions, which were cooperating to build the tunnel between Jersey City and Manhattan, were formally titled the New York State Bridge and Tunnel Commission and the New Jersey Interstate Bridge and Tunnel Commission. Their chief engineer for the tunnel was Clifford M. Holland; he died while it was under construction, and the tunnel was then named for him. 26. The letter, which has the stylistic markings of a J. H. Cohen legal brief, quotes at length from the Comprehensive Plan’s discussion of railroad freight bridges and tunnels, and then jumps to this conclusion: “It undoubtedly was the intention of the legislatures, as well as Congress, that the planning and developing of interstate bridges and tunnels dealing with freight movement by rail or by vehicle should be pursuant to a definite and well knit plan, under the supervision and direction of a single coordinating agency representing the two States. . . . ” (E. H. Outerbridge, letter to Governors Alfred E. Smith and George S. Silzer, March 9, 1923, pp. 2–3; emphasis added [Port Authority commissioners’ files].) 27. See Silzer’s veto message, March 22, 1923, and Smith’s, May 30, 1923 (both in N.J. Archives, Silzer files); New York Times, August 8, 1923. Smith had served as Democratic governor in 1919–1921 and, as described in chapters 2–3, he had favored creating a port authority to grapple with interstate problems. Losing to Republican Nathan Miller in the national landslide of 1920, he then defeated Miller in 1922 and would win reelection throughout the 1920s. On the important role of Silzer and Ammann in marshaling political support for Port Authority activities to aid motor vehicles, see chapter 6. 28. See Port Authority Minutes, Nov. 21, 1923. 29. See the Port Authority’s “Report on Vehicular Tunnels and Bridges,” Dec. 21, 1923, an appendix in the agency’s January 1924 Annual Report, pp. 43–49. 30. “The transportation systems of this country . . . have been built up upon the theory of individualistic control, development and advantage,” the Port Authority explained. “The executives and managers have reached their positions after years of service, in which they have become imbued with that theory. . . . It is only in recent years that it has come to be recognized that the transportation systems of the country are public highways, and that the public interest must predominate in the principles which govern their policies and operation.” (Port Authority, Annual Report, Jan. 19, 1924, p. 38.) 31. See Port Authority, Annual Report, January 15, 1926, pp. 9, 23–26. 32. Ibid., pp. 9–12. Progress in these three areas is also discussed in the Annual Report of January 1925, pp. 6–7, 11–23. 33. The key provisions are found in the Laws of New York, 1922, chapter 43 (Comprehensive Plan Act), as amended by Laws of New York, 1924, chapter 623 (Subpoena Power), sections 16 and 17. For discussion, see Port Authority, Annual Report, Jan. 1925, pp. 43–44; Bard, 1942, pp. 74–76. 34. The Hell Gate Bridge, shown in figure 5-1 above, spans the East River between the Bronx and the north shore of Queens. Because the New York Central could not use the Hell Gate crossing into Long Island, it brought its Long Island-bound freight down on its Albany-to-Manhattan tracks, and, at its 68th Street yard on the west side of Manhattan, placed the freight cars on car floats in the Hudson River; the cars were then taken around Manhattan to the East River, where they landed at Long Island City and were hauled to

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their destinations in Queens, Brooklyn, and farther east. See Port Authority, Annual Report, Jan. 1925, pp. 13–15. 35. Under the Subpoena Act, the Port Authority could instead have issued an order, forcing joint use of the Hell Gate. But it was not certain whether the courts would uphold that act until New Jersey had passed concurring legislation, which was pending throughout 1925. On the Hell Gate case in 1924–25, see Port Authority, Annual Report, Jan. 1925, pp. 13–15, and Jan. 1926, pp. 27–29; and Bard, 1942, pp. 78–84. 36. The Hoboken Railroad was only a small section of Belt Line 13, but the Port Authority was anxious to control the line because of its importance: its tracks connected directly with the Hoboken piers on the Hudson River, where consolidated lighterage could be established under the Port Authority’s plans. On the evolution of the Hoboken case, see the Port Authority, Annual Report, January 1926, p. 7; Bard, 1942, pp. 143–154. 37. Special Report of the New York State Bridge and Tunnel Commission and the New Jersey Interstate Bridge and Tunnel Commission, December 1923. 38. New York Times, August 8, 1923; George S. Silzer, Annual Message to the Legislature, Jan. 8, 1924; Alfred E. Smith, Annual Message, January 12, 1924. 39. Once the bridge legislation was passed, a few new staff members were added, but the main tasks—examining bridge design options and costs—were contracted out to the consulting firm of Waddell and Hardesty. As indicated earlier in this chapter (note 6 and associated text), the inattention of Cohen and his aides to the Staten Island bridge issue is suggested by the state legislation, which is sloppily drawn. It justifies the Port Authority as bridge-builder between New Jersey and Staten Island by citing the Comprehensive Plan’s Section 4, which is concerned only with Manhattan-New Jersey crossings. The correct citation would have been Section 3, which discusses tunnels and bridges and refers to crossings between New Jersey and Staten Island (though the implication is that these would be rail crossings). 40. See discussion of the Narrows Tunnel plan in chapter 4. 41. For details on the Narrows Tunnel episode, see David A. Johnson, Planning the Great Metropolis (London: Chapman & Hall, 1996), pp. 202–212; see also Bard, 1942, pp. 50–53. Cohen and his colleagues should not have been surprised by the Regional Plan’s position. In 1921–22, as Hylan advanced his Narrows tunnel plan and attacked the Port Authority, his main technical adviser was William Wilgus, a distinguished engineer who had long urged regional efforts to improve rail transport. Acting as consultant to Hylan, Wilgus argued publicly that a Narrows tunnel should be constructed. In 1924, Wilgus was hired as consulting engineer by the Committee on the Regional Plan, and it was he who took the lead in preparing the Committee’s position, which was a ringing endorsement of Wilgus’ own 1921 position in favor of the Narrows project. The legislation approved in Albany in 1925 did permit a small-bore tunnel (for rapid transit passenger trains) to be built under the Narrows, but no action was ever taken on that project. Johnson’s assessment (p. 209) is that the Narrows Tunnel rail-freight project was defensible on the basis of the “sound technical arguments” put forward by Wilgus and the Regional Plan group. But it could not readily be freed from its political history. The Narrows Tunnel project had been endorsed by Hylan in 1921 as a cudgel in his campaign against the Port Authority and against cooperation with New Jersey (see chapter 4). In that

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context, it could not easily symbolize a regional approach; nor was it likely that its sponsors could gain the cooperation needed to connect the Narrows Tunnel freight trains to the rail lines in New Jersey. 42. See Hapgood and Moskowitz, Up From the City Streets, 1927, p. 37. 43. Port Authority, Annual Report, Jan. 1926, pp. 5–29, 40–41. 44. The War Department’s most important new demand was that the Port Authority assume all prior and contingent liabilities of the Hoboken Railroad. Accepting this demand would make it impossible to predict that the line would break even financially. Since the Port Authority had planned to purchase the railroad from the War Department by selling bonds (it had no other source of funds in those years), and since bonds could be sold only on the assurance that the railroad’s future income would be adequate to repay the bondholders, the War Department’s position essentially blocked the purchase. Perhaps the department was never interested in selling the railroad to this public agency; during the years 1922–25 one obstacle after another had been placed in the Port Authority’s path. See the Port Authority’s annual reports for 1922–1926; also, Port of New York Authority, Special Report in Matter of Acquiring Hoboken Manufacturers’ Railroad Company from War Department, March 4, 1926 (Box 130H, files of Governor A. Harry Moore, New Jersey Archives, Trenton). 45. At the end of 1924, the Authority had appeared confident that unified, efficient service would be established throughout Belt Line 13 by “early in 1925,” and its annual report included six full-page photographs and two fold-out charts showing the changes in physical layout and in freight rates that were underway or in the offing. (See Port Authority, Annual Report, Jan. 1925, pp. 6, 9–11.) A year later, the Port Authority noted that the plan for a neutral director, who would be “in full charge” and with power to control movement of freight throughout the system, “has not yet been put in force”; however, physical improvements along the line were providing “increasingly valuable service to shippers.” (Port Authority, Annual Report, Jan. 1926, p. 8.) The appointment of the director is reported in the agency’s Annual Report, Jan. 1928, p. 23. For a summary discussion of the rise and fall of Belt Line 13, see Bard, 1942, pp. 63–74. 46. The tone and substance of the Port Authority’s position can be suggested by a few excerpts: “Each railroad in the port owns and operates its fleet without reference to the marine facilities . . . of any other carrier. There has been no coordination of effort. . . . The system naturally produces duplication of effort and interference which . . . can largely be eliminated.” Noting that the railroads were operating 1,700 barges, tugs and other watercraft, the Authority concluded that by “coordinating operations to a degree, the railroads will be able to give a better service and at the same time save several millions of dollars yearly.” (The quotations are taken from Port Authority, Annual Report, Jan. 1927, p. 15; diagrams of consolidated towing methods and tables of possible savings are appended to that report.) 47. In the words of the president of the Lehigh Valley Railroad, who issued a statement on behalf of the railroad executives: “To consolidate the harbor service of the New York railroads and to eliminate the competition which now exists among them as they strive to meet the demands of their patrons would serve . . . to eliminate in every way the human element which plays an important part in their present efficiency. . . . If anything

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is done to eliminate competition, service is likewise going to suffer.” (Statement on Pooling Railroad Marine Equipment . . . ,” April 27, 1927, as quoted in Bard, 1942, p. 108; emphasis added.) 48. In 1922, the ICC majority had concluded that the Milwaukee Railroad should be required to share its terminal facilities with a competing rail line, for a reasonable charge. The two lines had not reached agreement on the charge by 1926; the Commission then reversed its position and concluded that it did not interpret such sharing as necessary under the 1920 Act. Four of the 12 ICC members dissented, arguing that “the public interest requires the fullest utilization of existing terminal facilities.” See 107 ICC 208 (1926), discussed in Sharfman, 1935, vol. 3, pp. 416–17. 49. Brief of Julius Henry Cohen, before the ICC, May 16, 1927, as quoted in the Port Authority, Annual Report, Jan. 1928, pp. 40–41. 50. The ICC decision is 144 ICC 514 (1928). For the Port Authority’s interpretation, see its Annual Report, Feb. 1929, pp. 30–31; the arguments presented in the hearings and the ICC decision are examined in Bard, 1942, pp. 84–92. For an excellent analysis of the ICC’s reasoning in the Hell Gate case, and in other important cases in the 1920s, see Keith D. Revell, “Cooperation, Capture, and Autonomy: The Interstate Commerce Commission and the Port Authority in the 1920s,” Journal of Policy History, forthcoming. As the discussion in this chapter makes clear, the evidence indicates that Julius Henry Cohen and his colleagues at the Port Authority did not quickly and easily abandon their railroad plans; in 1926 and well into 1927, they railed against the dying of their Comprehensive Plan. My conclusion on this point contrasts sharply with the views of some other students of the period. Carl Condit, for example, wrote that the Plan had “everything to recommend it,” but that the Port Authority “quickly lost interest” in the railroads, “abandoned” the cross-Bay tunnel in 1925, and “grew indifferent to improving the rail terminal system.” (See Condit, The Port of New York, 1981, pp. 130–133; and see Note 3 above). As this chapter suggests, the Port Authority abandoned its rail schemes with great reluctance. 51. In Carl Condit’s phrasing, the railroads “shared in the national phobia about comprehensive planning.” (Condit, 1981, p. 121.) See also Herring, Public Administration and the Public Interest, 1936, chapter 13; Earl Latham, The Politics of Railroad Coordination, 1933–1936 (Cambridge: Harvard University Press, 1959), esp. pp. 246 ff. The railroads’ long-standing focus on “giving better service” as the best way to compete also made them wary of joint rail spurs and terminals. As one railroad man recalled, he and his colleagues were highly skeptical of the Port Authority’s proposals and other collaborative schemes: “In a joint operation, the individual railroad is not in complete control, and in certain competitive situations, this may damage the quality of service. . . . The quality of the rail service is often more important than its relative cost.” (Jervis Langdon, letter to the author, Dec. 2, 1991; Langdon was an official at the Lehigh Valley and New York Central railroads in the 1920s and 1930s, and he was later president of the Baltimore & Ohio Railroad.) Clifford O’Hara, who was a freight representative (or salesman) at the Pennsylvania in the 1940s, made the same point: “Our sales pitches to shippers and receivers were not based on rate competition between railroads; their rates were usually the same. We stressed the superiority of our service.” (O’Hara, letter to the author, June 29, 1998.)

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52. To railroad officials and their friends, the danger of ICC actions detrimental to the railroads had been a recurring problem in the years before World War I. See Albro Martin, Enterprise Denied: Origins of the Decline of American Railroads, 1897–1917 (New York: Columbia University Press, 1971), pp. 173 ff., 288 ff., and passim. 53. The Port Authority’s leaders had met with the railroad executives in the summer of 1928, and had reached agreement that “the wise policy of the immediate future was to concentrate on a particular project and to defer consideration of other projects involving railroad cooperation until a determination of economic practicality should have been reached . . . ” As the agency’s annual report makes clear, the railroads would be the judges of whether any of the other projects was economically justified. (Port Authority, Annual Report for 1928; the quotations are on p. 13.) 54. The planned total was reduced from nine to three terminals in 1929. The terminal at Eighth Avenue was opened in October 1932. The railroads’ attitude toward this project was assessed by Erwin Bard after ten years of operation: “The railroads agreed to promote the use of Union Inland Station. The record indicates very strongly that they have not lived up to their agreement. . . . It appears that wherever it lay within their discretion they have hindered its fullest use. With [few] exceptions the railroads have not chosen to truck freight direct from break-bulk stations in New Jersey to Union Inland, but have preferred to continue to pass Union Inland freight through their regular pier stations.” (Bard, 1942, p. 122; and see pp. 123–128.) 55. As described in chapter 2, the New York Harbor Case was brought by New Jersey interests in 1916, and the ICC declined in 1917 to approve separate rate structures for the two sides of the harbor, because historically it had been one port. The ICC had indicated that it might be willing to reconsider the issue, however, if the two states and the railroads did not find some amicable way to cooperate—perhaps by creating a regional port authority—and to improve the efficiency of rail and harbor facilities. (New York Harbor Case: Report of the Commission, 47 ICC 643 ff., June 25, 1917.) The renewed New Jersey action was filed with the ICC on October 31, 1929. 56. Freeman Dyson, Infinite in All Directions (New York: Harper and Row, 1988), p. 181. The settled pattern of railroad attitudes was reinforced by the ICC, which restricted competition in pricing and also protected railroads from invading each other’s territories. As Pendleton Herring comments: “Under the sheltering arm of the Interstate Commerce Commission, the railroads and the shippers have both found protection from the harsh impact of laissez faire” (Herring, 1936, p. 210), and while the railroads dozed under that sheltering arm, the truckers spread their wares. 57. Macleish, “Port of New York Authority,” Fortune (September 1933), p. 119.

Chapter 6 1. Condit, The Port of New York, 1981, p. 131. 2. The San Francisco airport is operated by one public authority, which has maintained a dominant position in long-distance service against the competing Oakland airport. One result is that travelers from the New York area to the populous eastern side of the region cannot fly nonstop into the nearby Oakland field; they must fly to the San Fran-

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cisco field and then “back-haul” to Berkeley, Oakland, and other cities in the East Bay. In ocean shipping, the port of San Francisco has competed—but with little vision and often with a strong focus on political patronage—against the Port of Oakland, which operates both the Oakland seaport and the airport. In competition against other West Coast ports, and in considering a wider range of economic-development projects, none of these public authorities can tap the tolls from the two heavily used bridges that operate nearby, for they are under separate control, and their revenues cannot be used for wider development projects. (See Boschken, Strategic Design and Organizational Change, 1988; J. W. Doig, “Entrepreneurial Leadership in the ‘Independent’ Government Organization,” paper presented at the annual meeting, American Political Science Association, September 1983.) 3. The Progressive values are described in chapter 1. 4. Portions of the Ammann story have been published in J. W. Doig, “Politics and the Engineering Mind,” Yearbook of German-American Studies, 25 (1990), pp. 151–199, reprinted in David C. Perry, ed., Building the Public City (London: Sage, 1995), pp. 21–70; and in J. W. Doig and D. P. Billington, “Ammann’s First Bridge,” Technology and Culture, 35 (July 1994), pp. 537–570. 5. The professor, K. E. Hilgard, had worked as a railroad-bridge engineer in the United States, and he pressed Ammann to go to the U.S.A.—where “the engineer has greater freedom in applying individual ideas” and where young men were sometimes put in charge of work “which, in Europe, only graybeards would be allowed to perform.” (Hilgard as quoted in M. K. Wisehart, “The Greatest Bridge in the World and the Man Who is Building It,” The American Magazine, June 1928, p. 183.) 6. Ammann later reported that “my first serious interest in the problem of bridging the Hudson was awakened shortly after my arrival in New York,” when he visited the top of the Palisades cliffs on the Jersey shore across from Manhattan. “For the first time I could envisage the bold undertaking, the spanning of the broad waterway with a single leap of 3000 feet from shore to shore, nearly twice the longest span in existence. . . . From that moment . . . I followed all developments with respect to the bridging of the Hudson River with keenest interest” (quoted in Urs C. Widmer, “Othmar Hermann Ammann, 1879–1965: His Way to Great Bridges,” Swiss American Historical Society Newsletter 15 [1979]: 5–6). Ammann’s first contact with the Hudson River challenge probably occurred while he was at the ETH Zurich, for the issue of how to bridge the Hudson had been debated since the early 1800s, and Ammann’s teacher, Ritter, had included a proposal for a Hudson bridge as the final design in his 1893 book (conversation with David P. Billington, January 1990). During those decades, the only way that horses and motor vehicles could travel between New Jersey and New York City was via ferry—unless they journeyed fifty miles north, where the Hudson was much narrower and smaller bridges had been constructed. Travelers could cross the Hudson as railroad passengers, once the Pennsylvania Railroad tunnel and two smaller tunnels under the Hudson (built by the Hudson and Manhattan Railroad) were completed in 1908–1910. 7. The Hell Gate crossing, sponsored by the Pennsylvania Railroad, would span the East River between Queens and The Bronx and thus fill the major gap in the Eastern rail system—allowing railroad trains to travel from New England to New York City and then

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into New Jersey and across the continental United States. It would be the longest arch bridge in the world. (See David P. Billington, The Tower and the Bridge [Princeton: Princeton University Press, 1983], pp. 125–128, and Tom Buckley, “The Eighth Bridge,” The New Yorker, Jan. 14, 1991, pp. 37–59.) The Port Authority’s effort to persuade the Pennsylvania to open the Hell Gate to competing railroads is discussed in chapter 5. 8. Born in Austria in 1850, Lindenthal studied engineering in Europe and crossed the Atlantic in 1874. He worked in Pittsburgh for several years and then moved to New York, where he drew up his first plan for a Hudson bridge in 1888. On Lindenthal’s life and works, see David P. Billington, 1983, pp. 123–132; Buckley, 1991; and Shanor, The City That Never Was, 1988), pp. 136–149. 9. “The Hudson River Bridge,” Scientific American, April 23, 1921, p. 324. See chapter 4 for a sketch of the bridge and a map showing its location. The 1921 article includes a detailed description of the project and sketches of the design. Estimated costs included the bridge ($100m), a freight classification yard in New Jersey ($25m), a Union passenger terminal in Manhattan for all the rail lines ($30m), an elevated railroad line from 57th Street down West Street to the lower tip of Manhattan, to distribute freight to inland and shipping terminals enroute ($30m), and equipment and electrification ($25m), for a total of $210,000,000 (p. 336). 10. Ammann to Rosa Labhardt Ammann, April 24, 1921; trans. Margot Ammann, 1988. 11. Lindenthal’s argument included a prophetic theme, which the Port Authority would later embrace, and still later abandon: “The problem of passenger transportation cannot be solved comprehensively and economically by detaching it from the problem of freight transportation. . . . Thoroughfares to attain their greatest efficiency and usefulness must keep both purposes in view” (p. 2). (“Memorandum by Gustav Lindenthal,” February 25, 1921, 12 pages; available at Port Authority library; DOC 21–1011.) 12. The quotation is from a 1907 paper by Burnham, a Chicago architect and planner, and is widely reprinted; it is quoted here from the frontispiece of a recent book that describes the wondrous hopes of Lindenthal and a large band of engineers and others who sought to reshape New York; see Shanor, 1988. 13. On Lindenthal’s experience and values, see Billington, 1983, pp. 123–132 and Shanor, 1988, pp. 136–149. His immersion in New York City politics had begun in 1902, when he was appointed bridge commissioner. During the next two years he completed the Williamsburg Bridge and planned the Manhattan and Queensboro bridges (all three spanning the East River from Manhattan to Brooklyn or Queens), but he had a series of conflicts with city officials on engineering and political issues, and in 1904 he resigned in frustration. See Sharon Reier, The Bridges of New York (New York: Quadrant Press, 1977), pp. 41–57. A major problem was that city engineers were under constant pressure to allocate contracts to firms associated with influential politicians. On the strategies used by Tammany Hall in obtaining Queensboro Bridge contracts in 1903, for example, see the summary of court hearings reported in “Dummies in City Contract,” New York Times, March 25, 1911. 14. Othmar Ammann to Rosa Labhardt Ammann, Dec. 14, 1923 (trans. Margot Ammann, 1988). 15. On Silzer and Wilson, see Arthur S. Link, Wilson: The Road to the White House (Princeton: Princeton University Press, 1947), pp. 245, 246. Silzer’s values and programs

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are conveyed in his inaugural address (January 1923) and his first and second annual messages to the legislature (January 1924 and 1925); see also Irving S. Kull, et al., New Jersey: A History, vol. 3 (New York, 1930), pp. 1080–83, and Paul A. Stellhorn and Michael J. Birkner, eds., The Governors of New Jersey, 1664–1974 (Trenton, N.J.: New Jersey Historical Commission, 1982), pp. 194–96. 16. Ammann’s diary entries during those years list several meetings with Silzer and other Such Clay directors; and the tone of Lindenthal’s January 30, 1923 letter to Silzer suggests that earlier discussions of engineering and financial details had taken place between the two men. (Ammann’s diaries, and some correspondence relating to his activities in the 1920s, are on file at the Winterthur Museum in Switzerland; I am indebted to Urs Widmer, the Museum’s director, for providing me with copies of these materials. Citations to correspondence and reports by Lindenthal, Ammann, and Silzer refer—unless otherwise indicated—to documents available in the New Jersey State Archives, Trenton, under the Papers of Governor George S. Silzer. In the Silzer Papers, most of these were initially deposited under the designation provided by Silzer and his staff: “Ammann Bridge”; most are now filed under “George Washington Bridge.”) 17. And so Ammann’s 1904 vision might be reclaimed, and converted into steel; see note 6 above. 18. The effort to build the first vehicular tunnel, between Jersey City and Canal Street, had encountered various delays, and in 1923 completion of the [Holland] tunnel was still years off. There was also some concern that the ventilation system in the underwater tunnel would not carry off the carbon monoxide; why build a second death trap, skeptics asked, until the first has been tried out? 19. Silzer did not set down these views systematically in one place. However, I believe this is a fair summary of his thinking in 1922–25. My main sources for his views are Silzer’s inaugural address in January 1923, his public addresses in January 1924 and 1925, and the correspondence and newspaper clippings found in the Governor Silzer files in the New Jersey Archives—particularly his letters of June 7, 1923 (to the managing editor of the New York Times), and Nov. 27, 1923 (to Dwight Morrow), Silzer’s public statement of Dec. 17 on Ammann’s plans, Ammann’s letters to Silzer on Dec. 12, 13, 17, and 24, 1923 (which summarize their several discussions), Silzer’s letter to Port of New York Authority commissioner Julian Gregory, Dec. 31, 1923; and other materials found in the New Jersey State Archives, Silzer files, 1924 and 1925. Some specific examples are given later in this chapter. 20. Although the Port Authority’s 1921 plan focused on improving railroad service, the agency also viewed trucks as relevant to its task, since they could serve as feeders between rail terminals and customers. Therefore, it might view a vehicular bridge at 179th Street as a useful route for feeder trucks carrying freight locally in the region. 21. See Michael J. Birkner, A Country Place No More: The Transformation of Bergenfield, New Jersey, 1894–1994 (Madison, NJ: Fairleigh Dickinson University Press, 1994), pp. 64–65. On the private tunnel plans, with some information as well on developments surrounding Ammann’s bridge, see Jacob W. Binder, All in a Lifetime (Hackensack, NJ, privately published, 1942), pp. 174–208. The book is not reliable on the role of Binder and on some other points; see my critique in Doig, “Politics and the Engineering Mind,” unpublished paper, 1990.

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22. The Swiss heritage included his student years in Zurich with Wilhelm Ritter, who emphasized aesthetic as well as technical principles in bridge-building. (See David P. Billington, “Wilhelm Ritter: Teacher of Maillart and Ammann,” Journal of the Structural Division, American Society of Civil Engineers, 1980, pp. 1103–16.) And, at a genetic level, Ammann may also have drawn upon his maternal grandfather, Emanuel Labhardt, a wellknown landscape artist. (Margot Ammann, “Beauty and the Bridge,” ca 1979, p. 1.) 23. The Hudson River was an important artery of interstate commerce, and the federal government would have to approve any construction that might affect use of the waterway. Ammann’s bridge at 179th Street would have a center span of 3,500 feet; the longest spans then in existence or under construction were the Manhattan Bridge (1,470 feet) and Williamsburg (1,600 feet), both across the East River to Manhattan, the Bear Mountain Bridge over the narrower Hudson farther north (1,630 feet), the Delaware River [Ben Franklin] Bridge to Philadelphia (1,750 feet), and the Ambassador Bridge over the Detroit River to Canada (1,850 feet). The engineering advances that would, in Ammann’s opinion, make possible this giant advance in span length included the creation of new alloy steels, development of more accurate methods of shop fabrication and shop assembling of bridge parts, better methods of calculating stresses and of model experimentation, and an improved conception of how to evaluate the forces that stabilize (or “stiffen”) a massive bridge. Ammann’s views on these issues are set forth in several speeches and papers during the 1920s and 1930s; for a summary discussion, see his paper, “Brobdingnagian Bridges,” Technology Review, 33 (July 1931), pp. 441ff. Whether the information available in 1922–23 was technically convincing may, however, be doubted. As David Billington notes (in conversation with the author, January 1990), Ammann surely “convinced himself” that the technology was available to permit doubling the length of a bridge span, but in view of the uncertainties regarding the impact of wind and other factors, a leap of faith—based on Ammann’s strong desire to create such a bridge—was almost certainly an element in his conviction. 24. Since early in the nineteenth century, engineers had attempted to make suspension bridges “more and more rigid, in order to eliminate the wavelike motion due to flexibility.” Rigidity was obtained by using heavy trusses, which required large amounts of expensive steel. Ammann’s studies convinced him that “for a long-span suspension bridge a rigid system was not necessary.” By eliminating large, stiff trusses, Ammann reduced the cost of the bridge by about 15 percent. (These quotations are from the form nominating the George Washington Bridge to be a National Historic Engineering Landmark, as quoted in Leon Katz, “A Poet in Steel,” Portfolio: A Quarterly Review of Trade and Transportation, Summer 1988, p. 34.) Later analysis by David Billington and his associates indicates that Ammann’s conclusions on the need for a rigid system for long-span bridges were not correct; see David P. Billington, “Wilhelm Ritter: Teacher of Maillart and Ammann,” 1979, p. 41; S. G. Buonopane and D. P. Billington, “Theory and History in Suspension Bridge Design from 1823 to 1940,” Journal of Structural Engineering, 119 (3) (March 1993), pp. 954–977; Doig and Billington, 1994, pp. 549–559. 25. As he wrote to his mother in 1921, “Toward strangers one is always covered with a veil. . . . The human soul must not expose itself to the profanities of the world.” (Febru-

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ary 12, 1921; trans. Margot Ammann, 1988; my comments on Ammann’s personality also benefited from discussions with Margot Ammann and Sylva Brunner.) 26. “Our neighbor knew how much midnight oil father was burning because she often had to attend to her sick mother during the night. ‘Whenever I looked over to the Ammann house, at one o’clock, three o’clock, there was always a light burning in Mr. Ammann’s study and I knew he was working.’ ” (Margot Ammann Durrer, “Memories of My Father,” Swiss American Historical Society Newsletter, 15 [June 1979], p. 29.) 27. O. H. Ammann, letter to Governor George S. Silzer, January 9, 1923; from the George Silzer files in the New Jersey Archives, Trenton. In general—for items found in these files—when the writer, addressee and date of a letter are given in the text, footnote citations will be omitted below. The January 9 letter is the first correspondence between Ammann and Silzer in the Silzer files. 28. Silzer, Inaugural Address, Jan. 16, 1923, p. 8. As his reference to “railroad terminal service” suggests, neither Silzer nor Ammann was yet ready to break with Lindenthal, whose 57th Street Bridge would send both motor vehicles and railroad trains into Manhattan. 29. Ammann reported one of their final exchanges in his diary entry of March 22, 1923: “Submitted memo to G. L., urging reduction of H.R.Br. program dated Mar. 21. G. L. rebuked me severely for my ‘timidity’ and ‘shortsightedness’ in not looking far enough ahead. He stated that he was looking ahead for a 1000 years” (quoted in Widmer, 1979, p. 8). “Lindenthal took the first opportunity to lay Ammann off,” Edward Cohen concludes, “and in 1923 the two men parted” (Cohen, “The Legacy of Othmar H. Ammann,” May 1, 1987 [ms., Ammann & Whitney], p. 9). 30. During this period, Silzer continued to explore the possibility of private funding for the Fort Lee span. See for example his letter of June 7, 1923 to the New York Times and his Nov. 27, 1923 letter to Dwight Morrow. The Port Authority’s position was set forth by its chairman in a letter to the governors, March 9, 1923; see chapter 5 for more details. 31. Al Smith’s position was emphatic. In his message of May 30, 1923, vetoing the private-tunnel bills, Smith asserted that new tunnels “should be constructed by and under the direction of the Port Authority, as . . . they would be state owned without the necessity for the appropriation of public money.” Smith’s experience with the Holland Tunnel strengthened his preference for the Port Authority model. New York State had decided to pay its share of the Holland out of annual appropriations, and as the tunnel effort faced delays and added expenses in the early 1920s, state officials had to draw tax revenues away from other needs to pay for construction. In contrast, the Port Authority was expected to float bonds for its construction projects, and repay them from rents and tolls at its terminals and other facilities. Smith liked this approach in general (he called it “a thoroughly modern approach” to financing public works); and as governor he was especially glad to give responsibility to an agency which would not be a drain on the state’s tax revenues. (Smith’s interest in turning over the task to the Port Authority was also shaped by his earlier involvement: see chapters 2–4 above.) Julius Henry Cohen was an adviser to Smith during the 1920s on issues relating to the Port Authority and to possible new programs in other fields, such as water power and public housing. Therefore, it is possible that Cohen took the initiative in urging Smith to expand the Port Authority’s duties to include motor-vehicle projects. But Cohen had much

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on his plate, as we have seen, and my sense is that Smith took the lead on this issue, while Cohen, in 1923, viewed it as somewhat of a distraction from his and the agency’s main concerns. It is also worth noting that Smith and Cohen did not always agree on important issues affecting the Port Authority; for example, Smith was a firm advocate of giving New York City’s elected officials a major role in selecting that state’s Authority commissioners, and Cohen opposed that plan. Later, Cohen would favor the Port Authority taking on an important role in passenger rail transit, and Smith rejected that idea. The joint statement of August 1923 represented Smith’s views far more than Silzer’s; through November 1923, Silzer was still pursuing the possibility of private funds for the bridge. (See Silzer to D. Morrow, Nov. 23, 1923. The August joint statement is included in Port Authority, Minutes, meeting of December 19, 1923, p. 3, and in Bard, 1942, p. 182.) 32. As noted in chapters 4 and 5, the Port agency was involved in a variety of negotiations focused on improving freight movement into and through the central business area. A bridge six miles north of the CBD, limited to motor vehicles, was not seen as an important step in meeting these problems. (For the views of Port Authority officials and Governor Silzer in these months, see E. Outerbridge to G. Silzer, March 9, 1923; Silzer veto message on New Jersey bill for private bridges and tunnels, October, 1923; Ammann to Silzer, Nov. 22, 1923; Silzer to D. Morrow, Nov. 27, 1923; Morrow to Silzer, Dec. 5, 1923; J. Gregory to Silzer, Dec. 18, 1923; all in N.J Archives, Silzer files.) 33. Port of New York Authority, Board of Commissioners, Minutes, meeting of Nov. 21, 1923. The quotations in the text are taken from Gregory’s summary, included in the Minutes. 34. The summary and the quotations, in this paragraph and those below, are from Ammann letters to Silzer, Nov. 22, Dec. 6, 1923; Silzer letter to Morrow, Nov. 27, 1923; Morrow letter to Silzer, Dec. 5, 1923. 35. Ammann to Silzer Dec. 12, Dec. 13, 1923. (Having left Lindenthal’s employ early in the spring of 1923, Ammann had continued to work full-time on the Fort Lee bridge project throughout 1923, without pay, using his savings to support his family.) 36. Ammann to Silzer, Dec. 17, 1923 (with attachments); Silzer to the Port Authority Commissioners, Dec. 17, 1923; Silzer to Gregory, Dec. 17, 1923. 37. Both Ammann and the Port Authority had their roots in the era of railroads and rail freight, but Ammann had found it easier to respond—in his general thinking about transportation patterns, and in developing detailed designs—to the increasing use of trucks and automobiles. In part, this reflected his greater readiness to let his mind absorb new facts and use them to modify his views about the world. In addition, to a bridge engineer, designing long spans for cars and trucks offered great advantages over railway bridges—for the structures could be lighter and less costly, and their location was not limited to the endpoints of existing rail lines. And to Ammann in particular, with his driving aesthetic interest in constructing bridges which had a “light and graceful appearance,” the automotive age offered possibilities for artistic achievement denied to those who built in the railroad era. For the exchanges mentioned in the text, see Gregory to Silzer, Dec. 19, 1923; Port Authority Commissioners, Minutes, Dec. 19, 1923; Port Authority Commissioners, letters to Governors Silzer and Smith, Dec. 21, 1923.

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38. “Mr. A. had been my trusted assistant and friend for ten years,” Lindenthal wrote, “trained up in my office and acquainted with all my papers and methods. But I know his limitations. He never was necessary or indispensable to me. . . . Now it appears that A. used his position of trust, the knowledge acquired in my service and the data and records in my office, to compete with me in plans for a bridge over the Hudson and to discredit my work. . . . He does not seem to see that his action is unethical and dishonorable. . . . ” (Lindenthal to Silzer, Dec. 20, 1923.) There is no direct evidence that Governor Silzer showed this letter to Ammann, but Silzer’s general habit was to send letters he received to other interested parties, and Ammann’s letters to Silzer in later months make it clear that he knew Lindenthal had criticized his behavior on professional and personal grounds. As earlier sections of this chapter indicate, Lindenthal’s characterization of Ammann’s actions was quite unfair. 39. See the analysis of this campaign and related developments in Michael Birkner’s excellent study of the evolution of a New Jersey community: Birkner, 1994, pp. 62–69. 40. Ammann, “The Hell Gate Arch Bridge and Approaches of the New York Connecting Railroad Over the East River,” a paper delivered at a civil engineering meeting in 1917 and published in the American Society of Civil Engineering, Transactions (1918): 863. 41. Silzer to Cohen, May 22, 1924. Local efforts in the Staten Island area which led up to approval of the two bridges are discussed in chapter 5. Ammann’s campaign to convince Governor Silzer and other New Jersey leaders that the Port Authority was the best instrument for building interstate crossings added a further push. 42. These events are described in Englewood Board of Trade, letter to Silzer, April 3, 1924, and Ammann to Silzer, May 7 and May 27, 1924. For newspaper reports of Ammann’s efforts during these months, see “Fort Lee Bridge is Advocated by Engineer Ammann,” Bergen Evening Record, March 5, 1924; “Bridge at Fort Lee Sure, Says Ammann,” Palisadian, April 25, 1924; and “Bridge the Hudson Meeting Monday: Engineer Ammann Will Tell of Proposed Structure,” Bergen Evening Record, May 3, 1924. 43. Ammann to Silzer, July 23, Nov. 23, Nov. 29, 1924; Silzer to Ammann, Nov. 24, 1924; Palisadian, Nov. 14, 1924; Boonton Times, Nov. 28, 1924. 44. See Birkner, 1994, pp. 68–69; also Bergen Record, Dec. 10, 13, 1924 and Jan. 13, 1925; Ammann’s letters to Silzer, Jan. 29, Feb. 25, and March 27, 1925; and J. W. Binder’s letter to Silzer, March 4, 1925. 45. Silzer to Gregory, April 14, 1925. 46. Ammann to Silzer, April 17, 1925.

Chapter 7 1. New York: McGraw-Hill, 1936, p. 377. 2. “New York Speaks,” Oct. 18, 1931, part of a special section of the New York Times on the opening of the Hudson River span. 3. In late 1923, for example, Ammann had assured Governor Silzer: “In spite of the great central span of 3400 feet, which is more than twice the span of any of the East River bridges, no serious technical difficulties in the manufacture or erection are involved. The practicability of such a large span has been recognized by eminent engineers 30 years ago. . . . ” (Am-

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mann, “Proposed Hudson River Bridge between Washington Heights and Fort Lee,” December 18, 1923, p. 4.) 4. A famous failure was that of the great Quebec bridge in 1907, which Ammann saw first hand as part of the investigating team which examined the collapse of that span. 5. In the spring of 1924, as noted in chapter 6, both states had authorized the Port Authority to construct two bridges to New Jersey (later named the Outerbridge and Goethals spans), and the bi-state agency commissioned the consulting firm of Waddell and Hardesty to design the two structures. To execute those designs, however, the Port agency would rely on its own staff, operating under its new bridge engineer. In March, 1925, New Jersey approved a third bridge, crossing from the northern end of Staten Island to Bayonne; and New York State gave its assent a year later. 6. See Newark Evening News, Jan. 29 and 30, 1924, and Bard, Port of New York Authority, 1942, pp. 182–184. 7. For an extended discussion of this theme, see Jeffrey L. Pressman and Aaron Wildavsky, Implementation (Berkeley: University of California Press, 1973), which carries the subtitle “How Great Expectations in Washington are Dashed in Oakland; or, why it’s amazing that federal programs work at all.” That state and local programs often fail too is a theme of a wide literature; see for example, John E. Chubb and Terry M. Moe, Politics, Markets & America’s Schools (Washington, D.C.: Brookings Institution, 1990); Alberta M. Sbragia, Debt Wish: Entrepreneurial Cities, U.S. Federalism, and Economic Development (Pittsburgh: University of Pittsburgh Press, 1996). 8. His engineering analysis is captured in a series of memoranda; see especially Ammann, “Hudson River Bridge at Fort Lee: Comparison of specified loads and unit stresses . . . ” (August 11, 1925); and his memoranda on design studies (August 15, Sept. 8, Sept. 28, Oct. 28, Oct. 29, Nov. 27, Dec. 1 and Dec. 9, 1925). Ammann’s diary entries, July 1925 through February 1926, provide information on his work schedule. (The 1926 report is on file at the Port Authority library; the other materials are on file in the Ammann archives, Winterthur, Switzerland.) 9. The Port Authority’s documents relating to these events appear to have been destroyed many years ago, but Ammann’s contemporary letters and diary entries provide us with some details on developments described in these paragraphs. The issue of how wide the bridge should be was under active discussion in the fall of 1925, for example, and Ammann’s diary includes the following entries: Nov. 6—“Mr. Drinker is in favor of a 6 lane roadway.” Nov. 11—“Discussed with Mr. Drinker capacity of HRB. He agreed that for purpose of prelim. estimate we should figure on a 8 lane roadway.” Dec. 5—“Discussion with Mr. Drinker of rdwy capacity. He arrived by theoretical deductions at a veh. traffic of 1800 veh. p. hr & insists that on that basis a 4 lane bridge is sufficient.” These varying signals from his own boss were not helpful to Ammann, particularly since Cohen and the board had asked him in his early weeks on the job to complete a preliminary report by early in 1926 (see Ammann’s diary entry for August 26, 1925). In December, Ammann went to see John Ramsey, who was in charge of evaluating traffic demand on the bridge, and Ramsey “agreed that capacity should be at least 8 lanes of veh. traffic” (Ammann’s diary, Dec. 10, 1925). 10. Ammann’s diary provides a summary of these events: Feb. 6, 1926—“Mr. Ramsey called me to his office & informed me of changes in organization. He has been appoint-

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ed Chief Executive Officer. He appointed me Bridge Engineer in full charge of bridges.” Feb. 8—“I suggested retaining [Dr. Waddell] on % basis for plan, specif & contract & advising during construction, but all executive work to be done by our own organization.” Ammann’s suggestion was apparently approved (see his diary, Feb. 10ff.). Family letters offer a clearer view of the main changes. On February 12, Ammann’s wife wrote to his mother in Switzerland: “Othmar recently said to me: ‘Something is going on in the committee meetings of the Port Authority,’ but he didn’t know what. Now, a few days ago, he was told that he would be appointed Chief Engineer of the entire Bridge Department. . . . The former Chief, somewhat astonished by this, was given a less important post as Consulting Engineer.” (Lilly Ammann to R. L. Ammann, Feb. 12, 1926.) The same day, Ammann wrote to his mother, “The reorganisation of the Port Authority is, so to say, accomplished. Five divisions were melted into two. It cost ‘the head’ of the chief engineer and several division chiefs and in their place I was chosen to be Chief of the Bridge Division.” (O. H. Ammann to R. L. Ammann, Feb. 12, 1926; trans. by Margot Ammann, 1988.) The reorganization is briefly described in the Port Authority’s Annual Report for 1926 (Jan. 20, 1927), pp. 41–42. See also letter from Leopold Just (a member of Ammann’s engineering staff in the 1930s) to Margot Ammann, Sept. 12, 1988. 11. For example, American City Magazine showed a sketch of the Hudson River span on the cover of its April issue and carried an article on the “great structure” with its “graceful and beautiful” lines and “enormous scale” (April 1926, p. 365). 12. The first effort to curb the agency occurred in January 1926, when a bill was introduced in the state senate, requiring the New Jersey commissioners to transmit records of all board actions to the governor, who would have ten days to veto their decisions. The Port Authority vigorously opposed the bill, and its chairman, New Jersey’s Julian Gregory, wrote to Governor Moore to urge that he not support the veto plan, since it would “make for a great deal of difficulty for the Port Authority as well as for yourself.” Gregory argued that a ten-day period would require the Port agency to delay in “many situations where prompt action is imperative,” perhaps causing “irreparable injury” in carrying out the bridge projects and the Comprehensive Plan. “At no time,” he said, “has there been any necessity for such a safeguard as this,” and the commissioners “resent the implication” that their past behavior suggests that a veto threat is needed to “safeguard the interests of both states.” (Julian A. Gregory, letter to Governor A. Harry Moore, March 27, 1926; New Jersey State Archives, file PA 130a.) Moore was unmoved, and his recurring criticisms are illustrated by his letter a few months later to one Port Authority critic. The agency had been created “seemingly with the power of a super-State . . . long before I became Governor,” Moore argued, and he favored giving veto power over Authority activities to the state’s chief executive. “Personally,” he concluded, he was “opposed to the ‘super-State’ idea.” (A. Harry Moore, letter to J. D. Holmes, June 28, 1926; State Archives, PA 130a.) Silzer and his aides held a very different view. See, for example, the comments by Silzer’s Attorney General in 1925, endorsing the Port agency’s bridge-construction program: “The Port Authority is a super-government, created by the treaty of the States. It is an instrumentality of each State, and yet more, being an instrumentality of both States. . . . ” (Edward L. Katzenbach, letter to the governor, March 5, 1925.) Silzer had requested

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Katzenbach’s assessment of the Port Authority’s powers, and he released the statement with his implied concurrence. (DOC 25–1005 in the Port Authority library.) The role of Hague and the Democratic machine of Hudson County in selecting Silzer’s successor are described in McKean’s classic study: With Silzer required to leave office at the end of 1926, “Hague turned to his old friend, [Jersey City] Commissioner A. Harry Moore, who began that year a notable career in state politics. The Mayor told the people of Jersey City to show the rest of the state ‘what a fine vote-getter he is.’ ” In the general election, Moore trailed the Republican candidate by 65,000 votes when the votes from 20 of the 21 counties were tallied. But in the 21st county, Hudson, where Jersey City is the largest town, Moore piled up a lead of 103,000 votes—giving him the governor’s chair by a margin of 38,000 state-wide. (McKean, The Boss, 1940, pp. 50–51.) 13. Ammann’s views are set forth in his memoranda on Design Studies, Sept. 28 and Dec. 1, 1925. His meeting with the American Bridge Company, which had constructed Brazil’s Florianopolis Bridge, is recorded in his diary for Dec. 2, 1925. 14. W. A. Anderson, John A. Roebling’s Sons Company, letter to A. Harry Moore, March 16, 1927 (N.J. State Archives, PA 130p). 15. Hague was unhappy at this reward for an enemy of his regime; in addition, Hague and Moore were reported to believe that Silzer should have asked them to select “a man for the place,” rather than making the decision on his own (New York Times, March 25, 1927). See also the report of Hague’s “anger . . . due to Keefe appointment” in the Jersey Observer, May 15, 1927. 16. The State House Commission consisted of the governor, the state controller, and the state treasurer; in 1927 the first was a Democrat, the other two were Republicans. The bill was introduced by Senator Alexander Simpson, Democrat of Hudson County, who echoed Governor Moore’s criticism of the Port agency as a “super-State,” and the measure attracted wide Republican support. (New York Times, March 25, 1927.) Illustrating the protectionist theme, the bill cited the need to “give the State of New Jersey some power to prevent the making of contracts by the Port Authority which may be inimicable to the manufacturing interests of the State. . . . Before approving any contract [state officials] will investigate to ascertain whether the manufacturing industries of this State or the workers of this State will be injured by any contract. . . . ” In such instances, the State House Commission would “have the power to prevent the making of such contract. . . . ” The Port Authority had already experienced political pressure during its work on the Staten Island bridges. In August, 1926, the agency had awarded contracts to firms which employed nonunion labor, and Theodore Brandle, a union leader with ties to Frank Hague, had urged the governor to block that decision. Moore expressed sympathy but pointed out that he did not yet have the power to stop the Authority’s actions. (See A. Harry Moore, letter to R. V. Lewis of the Building Trades Council, Nov. 22, 1926, and related materials in the State Archives, PA 130i.) 17. See New York Times, March 26, 1927. The Port Compact did provide (in Article 16) that each state could enact a law giving veto power to its governor over the actions of the Port Authority commissioners from that state. Smith had always opposed such a state law, preferring to leave the Port agency free to make its decisions independently,

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based on the broad perspective of its commissioners. The New Jersey bill, giving power over the bi-state agency’s work to a set of Trenton officials, risked a further fragmentation of control. 18. For Moore’s comments as quoted in the text, see New York Times, March 27, 1927. 19. The Port Authority expected to finance a large portion of the cost of building the Hudson River bridge by selling bonds, secured by the anticipated revenues from tolls on the span. The efficiency with which Ammann was proceeding, together with the high level of expected traffic, were attractive elements for a potential purchaser. However, review by the State House Commission might lead to delays in letting contracts, stretching out the time before toll revenue would be available to pay interest on the bonds. Moreover, contractors chosen because of political alliances might fail to meet performance standards, requiring costly repairs and placing bondholders at greater risk. These dangers would lead bond houses and their clients to hesitate. 20. The strategy of obtaining independence by positioning one’s agency between contending authorities is not limited to interstate bodies. For example, Admiral Rickover used the same strategy to achieve a high degree of autonomy for his nuclear ship program. See Eugene Lewis, “Admiral Hyman Rickover,” in Doig and Hargrove, eds., Leadership and Innovation, pp. 109–120. 21. In his public letter to New Jersey’s governor, Smith argued that the State House Commission law conflicted with the statutes approving the four interstate bridges; under those statutes “final authority over the type, manner and method of construction and location of bridges was definitely committed by law in both states to the Port Authority.” (A. E. Smith, letter to A. H. Moore, March 29, 1927, published in the New York Times, March 30, 1927.) The dismay which some members of Port Authority board felt regarding the political pressures swirling around them was conveyed in a personal letter sent to Smith by a New Jersey commissioner who was also a prominent banker; the commissioner praised Smith’s “gratifying” stand against those who would undermine the Port Authority’s independence in order to “enable selfish commercial or political interests to satisfy their greed for gain.” He cited “railroad antagonisms, . . . the labor union graft, and the jealousies over the control of . . . so large a sum that is in the hands of the Port Authority” as factors which had led to the State House Commission bill. (DeWitt Van Buskirk, letter to A. E. Smith, April 1, 1927; New York State Archives, Smith files 200–57.) 22. See New York Times, March 31, 1927. As to business protests, the Times reported, for example, that in Englewood, a large suburb near the Hudson River bridge site, the Real Estate Board had met and expressed concern that “thousands of investors in Bergen County real estate and in Port Authority bonds to be repaid from bridge tolls would be injured by delay,” and that “the threat of litigation, possibly prolonged, foreshadowed disaster to an enormous real estate boom which the New Jersey real estate owners are expecting, and in some cases experiencing, as a result of bridge plans” (March 31, 1927). 23. Ammann’s aesthetic judgment favored towers of monumental stone, contrasting with graceful, thin metal cables and decks; the dramatic Brooklyn Bridge was his standard. Buck’s view was that engineering structures should reveal, not hide “the elements of construction which are doing the work.” Since the steel in the towers would have to

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carry the entire load, to cover those towers with a masonry imitation seemed to Buck “an anachronism and an architectural crime.” Buck was a well known engineer who had been involved in the design and construction of the Manhattan Bridge and other spans in New York City. (His critique is found in the Stenographic Report of the remarks of Major R. S. Buck, at a meeting of the American Society of Civil Engineers, Feb. 16, 1927 [New Jersey State Archives, A. Harry Moore files, PA 130o; see pp. 1–2, 4–9, 12–13].) 24. Frederick Stuart Greene, letter to J. E. Ramsey, March 1, 1927; on file in the Ammann Archives, Winterthur, Switzerland. Also, C. W. Hudson, undated comments, probably Feb. 1927 (N.J. State Archives, PA 130j); the Buck and Hudson commentaries may have helped to prompt the letter of complaint, cited earlier, which the Roebling company sent to Governor Moore in mid-March. 25. Ammann had heard from several critics who objected to having the tower in the park and who urged that it be placed closer to the Hudson River. He had responded aggressively, arguing that shifting the tower out of the park would require extending the New York side span by 600 feet, making that span much longer than its counterpart at the New Jersey shore. As to the “resulting dissymetry,” Ammann said: “Let us consider it carefully before we lay before the world what might prove a structural and aesthetic abnormity. Once there it could not be corrected and might stand forever as a monstrous monument to the lack of aesthetic sense of those responsible for it.” (Port of New York Authority, press release, Feb. 24, 1927.) For his responses to Buck, Hudson and Greene, see Ammann’s memorandum of April 18, 1927, and J. E. Ramsey letter to A. H. Moore, April 22, 1927, both in New Jersey State Archives, PA 130a; and G. S. Silzer, letter to governors of New Jersey and New York, April 7, 1927, New York State Archives, 200–57. The “eminent” consultants mentioned by Ammann were George W. Goethals and Professor William H. Burr of Columbia University. 26. Ammann’s strategy emphasized close monitoring of quality issues; unusual flexibility in scheduling tasks, to respond to technical and political uncertainties; and specialization of task combined with rotation of jobs, to enhance morale and encourage more effective problem-solving. As one of Ammann’s aides later wrote: “Although the effort was made to keep each man engaged in the particular work for which he was best qualified, this specialization was not considered all-important, and through the transference from one group to another, each man was given as wide a variety of work as possible. This policy served to keep up a high morale among the men; it also gave each man a wider and more intimate knowledge of each structure as a whole, and thus led to more accurate and intelligent solution of the problems in hand.” (Edward W. Stearns, “George Washington Bridge: Organization, Construction Procedure, and Contract Provisions,” Transactions of the American Society of Civil Engineers, 97 [1933], pp. 71–72; and see pp. 72–82 for a careful analysis of Ammann’s management style. See also Bard, 1942, pp. 193–198.) As to the impact which the attacks by Buck and other well known engineers had on staff attitudes, and on the morale problems entailed in expanding and reorganizing the engineering corps, the surprise dinner given for Ammann in May or early June gives some hint of these strains: “One [of his assistants] invited him on this day for dinner and brought him by car to a first class hotel, where, to his surprise he found his whole ‘staff.’

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They gave the dinner in his honor, and let him know in words that they would all stand 100% behind him in his great enterprise. This vote of confidence was a great joy for him.” (Lilly Ammann to Rosa L. Ammann, June 8, 1927; trans. Margot Ammann, 1988.) 27. In countering Lindenthal, Ammann drew not only upon studies by his staff but also on a separate analysis carried out by one of his advisory engineers, Leon Moisseiff, who had designed the suspension bridge—the Ben Franklin—then being built across the Delaware River. (Lindenthal’s letter does not appear to have survived; but Ammann’s response refers to his letter of August 18, 1927 and describes Lindenthal’s criticisms; see O. H. Ammann, memorandum to J. E. Ramsey, August 24, 1927 [in Ammann Archives, Winterthur, Switzerland].) 28. In the press release, Silzer first announced that contracts for the Hudson River bridge would be awarded in October; he then turned to a “discussion of political and Port Authority matters” and noted that he believed Al Smith would be nominated and elected president. Silzer thought “unbounded enthusiasm should prevail in the prospects of New Jersey going Democratic in 1928,” and that the strong slate of candidates from the party in New Jersey “will perpetuate confidence in the Democratic organization.” The press release then summarized the schedule for awarding contracts based on objective criteria, and noted that the first two Staten Island bridges should be opened to traffic by the summer of 1928. (Port of New York Authority, press release, August 17, 1927.) 29. “The examination and approval of the various matters dealt with by your organization,” Moore wrote, “involves many questions of a technical engineering nature; hence, I feel it necessary to have qualified assistance and advice.” His choice, Joseph B. Strauss, was a well known bridge engineer; in 1927 he was actively campaigning for a span across the Golden Gate, the entrance to San Francisco Bay. (See A. Harry Moore, letter to John Galvin, vice chairman of the Port of New York Authority, July 28, 1927, and John E. Ramsey, letter to A. Harry Moore, August 8, 1927; N.J. State Archives, PA 130a.) 30. This summary is drawn from Strauss’s October report to the governor. His criticisms included doubts about traffic capacity, provision of rail transit on the lower deck, the kind of deck flooring to be used, and the plans to encase the steel towers in stone. Strauss complained that Ammann’s “present plan” was to proceed without changing his original scheme, “ignoring the possibility of the substantial savings which I pointed out.” (Joseph B. Strauss, letter to A. H. Moore, October 31, 1927; N.J. State Archives, PA 130q.) 31. The Port Authority had estimated that the cost of the towers, cable, and floor would total $25–26 million. When the bids were opened, the lowest total using eyebar chains was about $24.5 million, and the lowest overall bid was $22.5 million, by the team of Roebling for the cable and a separate firm for the towers and floor. The “considerable savings” under the estimate was due, Ramsey said, “to the wide competition.” (Port of New York Authority, press release, Oct. 13, 1927.) 32. The ground-breaking ceremonies were held on Sept. 21, 1927. Speeches at the ceremonies were carried in local newspapers, and excerpts are found in Julius Henry Cohen, “Accomplishments and Plans of the Port of New York Authority,” Oct. 6, 1927, pp. 5–6, 11. The ceremonies were also described by Ammann’s wife in a letter to his mother; she wrote that Othmar rode with the two governors to the ceremonies, that naval warships fired a salute and three airplanes performed, and that fireworks “spelled out the words in sparks:

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Hudson River Bridge!” (Lilly Ammann to Rosa L. Ammann, Oct. 3, 1927; trans Margot Ammann, 1988.) 33. The quotations are from the Staten Islander, Sept. 17, 1927, and Newark Evening News, Sept. 22, 1927; the suggestion that the Port Authority approach be used to finance the Chain Bridge over the Potomac is in a Washington News editorial, Sept. 16, 1927; see excerpts in Cohen, 1927, p. 6. 34. The criticisms, levied in early November, were that the engineering specifications for laying the concrete roadways over the bridges were designed to favor a special type of paving, as well as certain contractors, increasing the total cost. Moore at once appointed a team of independent engineers to investigate the charges, and that team reported a week later, rejecting the criticisms and approving the approach which Ammann and his staff had taken. Moore promptly endorsed their findings and urged the Port Authority to press ahead with completion of the two spans. (For detailed materials on the paving issue, see State Archives, PA 130a, 130f, 130g, 1301.) 35. As illustrated, for example, by Woodrow Wilson’s argument, in 1887: “Administration lies outside the proper sphere of politics. . . . Although politics sets the tasks for administration, it should not be suffered to manipulate its offices.” (Wilson, “The Study of Administration,” Political Science Quarterly, 1887, p. 210; emphasis in the original). See Chapter 1 above for further discussion. 36. See “A Monumental Bridge,” Scientific American, Nov. 1927, pp. 418–420; “Good Building,” Engineering New Record, Nov. 10, 1927. For those interested in the nature of Ammann’s creative efforts at the Staten Island crossing, here is an excerpt from the ENR article: “The substructure work . . . proved an excellent test of the versatility of the engineers and contractors. . . . [For example] in all the scores of piers constructed, only small groups . . . were alike in foundation conditions. There was therefore continual need for change of design by the engineers and change of construction procedure by the contractors. Somewhat remarkably at the same time the work, consisting of many similar structures, encouraged ambition to standardize on equipment and processes. . . . The pier building, like the foundation excavation and construction, was noted for the freedom exercised in changing and adapting plant and procedure. . . . “An example of this liberty in making changes is furnished by the substitution by one contractor, with the engineers’ consent, of structural frame reinforcement for the planned loose rod reinforcement. . . . . It offered advantages of economic construction to the contractor. By putting a little more money into the skeleton of reinforcing steel he provided a frame to carry the forms and a staging by which to swing them into place. All through the work, like co-ordination and continuity of purpose in design and construction come into evidence.” 37. As the New York Times commented, the Staten Island bridges “will open up a new industrial field” near the spans, demand for apartments was growing, and realtors “are looking forward to the busiest and most prosperous season in many years” (April 1, 1928). The Elizabeth-Staten Island bridge was named for General Goethals after his death early in 1928; the Perth Amboy crossing was named for Eugenius Outerbridge, the first chairman of the Port Authority. M. K. Wisehart praised the Hudson River crossing in “The

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Greatest Bridge in the World and the Man Who is Building It” (American Magazine, June 1928, pp. 182–189). Though his phrasing is slightly hyperbolic, the author captured the themes which were regularly seen in stories about Ammann’s works in 1928–31: “What a bridge! Outranking in magnitude all the seven wonders of the ancient world, it will stand as one of the great engineering achievements of mankind! Now, in this great industrial triumph, this conquest of space, altitude, wind, water, heat and cold, scores of engineers, and thousands of other men, skilled and unskilled, will share; yet, in a sense, the whole project, a masterpiece of daring and simplicity in design, an epic of engineering construction, is the product of the genius of one man” (p. 183). 38. In 1928, the New York Times had seen the two Staten Island bridges as “one project in the comprehensive plan” of the Port Authority, and as “part of the development of the vast harbor area by the Port Authority.” A readiness to embrace dreams unhindered by reality touched other facets of the Times analysis, notably when its writer reported that all tolls “will automatically be suspended when the bonds are amortized” (New York Times, June 10, 1928). Early in 1929, the Times saw the agency’s new annual report and reacted more pessimistically. As to the prospects for rapid progress on the Comprehensive Plan, that report offered “discouraging reading” to the Times editorial staff. None of the belt lines appeared likely to be fully in operation in the near future, the effort to coordinate the railroads’ expensive lighterage system had produced “no concrete results,” the inland terminal project had not advanced beyond the discussion phase, and the ICC had rejected the Port Authority’s plan to open the Hell Gate Bridge to all competing rail lines. (“The Port Authority’s Year,” editorial, New York Times, Feb. 25, 1929.) The Port agency itself put a better face on these modest results, concluding that “considerable progress has been made toward the solution of the many problems involved in the multiphased task presented by the Statutory Plan”—the new title that now emerged in place of that hallowed ghost, the Comprehensive Plan. (Port Authority, annual report, Feb. 15, 1929, p. 7.) 39. These developments are described in the Port Authority’s annual report for 1929 (March 20, 1930), pp. 39–41. The Roebling Company also erected a laboratory in Trenton and conducted rigorous testing as it manufactured the thousands of miles of wire rope needed for the Hudson bridge. (See Clifford W. Zink and Dorothy White Hartman, Spanning the Industrial Age [Trenton: Trenton Roebling Community Development Corporation, 1992], chapter 5.) 40. Commissioner Howard Cullman of New York voted for “Hudson River Bridge”; during the public debate, which extended from January until late April, he was attacked as a member of the “little band of internationalists” who were reluctant to honor the Father of the Country. (See New York Times, April 24 and 25, 1931.) 41. “The Hudson is Bridged,” editorial, Engineering News-Record, Oct. 22, 1931. To the ENR, this was “the greatest engineering structure of this generation.” The New York Times commented on its “symmetry and grace, and even a lightness of texture, that speaks worlds for the aesthetic sense of engineer and advisers” (editorial, Sept. 9, 1931). The Bayonne crossing, opened on November 14, was acclaimed as the longest arch bridge in the world. At 1,675 feet, it exceeded the great Hell Gate Bridge by nearly 700 feet, but with

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the Sydney Harbor crossing in Australia nearing completion, it would turn out to hold the world record for arch bridges by a slim four inches! 42. See for example the letter from the Corporation Counsel of Jersey City, to Governor Moore, Jan. 24, 1928 (New Jersey State Archives, PA 130q). 43. A. Harry Moore, constitutionally barred from serving a second consecutive threeyear term, had stepped down in January 1929. In the 1928 campaign, Herbert Hoover had defeated Alfred E. Smith for the presidency, and the Republican party had swept both houses of the state legislature and the governorship. 44. For the Larson quotations, see New York Times, Oct. 16, 1929. The sentiment in New Jersey for reopening the lighterage case is illustrated by materials in the files of Governor Larson (N.J. State Archives, PA 145g). See for example the letter from an official of the Ingersoll-Rand company to Larson, arguing that the existing rate structure “discriminates in favor of New York,” criticizing the Port Authority for its bias toward New York interests, and urging that New Jersey industries and citizens should be prepared to carry “the real fight” to the ICC (W. L. Saunders to Morgan F. Larson, Mar. 19, 1929); the editorial in the Newark Evening News which urged action so that “unjust and burdensome rates” would not “cripple this great industrial area” (Aug. 30, 1929); the report of Sept. 10, 1929 from New Jersey’s attorney general endorsing the lighterage challenge; and Larson’s letter to his Attorney General, ordering him to beginning legal proceedings to end “unlawful and unjust discrimination” in freight rates for New Jersey destinations (Sept. 17, 1929). For summaries of these developments, see the Port Authority’s annual reports for 1929 (March 20, 1930), pp. 33–37, and 1930 (Feb. 10, 1931), pp. 31–32; also Bard, 1942, pp. 170–172. The original case, filed with the ICC in May 1916 and decided by the Commission in December 1917, is discussed in chapter 2. 45. In 1929, Governor Larson wrote to the Port Authority to indicate that “approval is withheld” on commissioners’ actions relating to construction of the inland freight terminal in Manhattan. His dissatisfaction appears to have been prompted by concerns, expressed by New Jersey interests, that his state would be disadvantaged by that terminal (see for example New York Times, Oct. 3, 1929). Writing confidentially to the commissioners, Cohen argued that Larson’s statements need not be treated as a formal veto. Larson withdrew his opposition to the freight terminal in a letter to the agency in May 1930. (See Julius Henry Cohen, General Counsel’s memorandum GC 14, Sept. 30, 1929, pp. 1–3, available in the Law Department, Port Authority; and M. F. Larson, letter to John E. Ramsey, May 27, 1930, in N.J. State Archives, PA 145g.) 46. Sensitive to their critics on the Brooklyn side of the harbor, they also urged that Jamaica Bay be developed as a significant port. These several plans are described in the Port Authority’s annual report for 1930, pp. 15, 20, and in the Port Authority’s annual report for 1931, pp. 17–22. (“Objective cooperation” in the text is from Julius Henry Cohen, “A Port of 185 Competitors Working in Unity,” speech before the Newark Traffic Club, Feb. 7, 1929, p. 1.) The divisions among New Jersey firms on the lighterage issue can be captured in this way: The railroads’ traditional practice was to include the cost of floating goods across the Hudson (to New York City piers) as part of the charge quoted to any New York or New Jer-

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sey destination in the region. If this cost—the lighterage charge—were broken out, and charged only for destinations where lighterage was actually used, many New Jersey sites would become low-cost transportation sites, compared with the New York side of the harbor. However, “free” lighterage was also used by the United States Rubber Company in transporting goods from New Jersey railheads to its four New Jersey plants, by National Sugar for its large refining plant at Edgewater, and by a number of other New Jersey businesses, and they saw the additional charge as harmful to their interests. Their opposition was expressed in a series of letters to Governor Larson in the summer of 1929, and published by the Port Authority (Port of New York Authority, “Communications to the Governors of New York and New Jersey in Reference to the Lighterage and Trucking Issue,” July 1929). 47. Decrepit, in that the modernization which had been planned by the Port Authority and the region’s port cities had largely been suspended because of the Depression. Enroute to the final 1934 ICC decision endorsing unity of rates in the New York harbor, the Port Authority had been confronted with a report from the Commission’s examiner, recommending the opposite conclusion—that lighterage charges be separated from other transport charges. Because that 1933 report focused mainly on Boston’s attempt to obtain lower rates than New York, the Port agency was able to file a statement in opposition; but it was careful to point out that it was taking no position on New Jersey’s case against unified charges. (For summaries of the ICC actions, see the Port Authority’s annual reports for 1931, p. 30; 1932, p. 27; 1933, p. 32; and 1933, pp. 25–26.) 48. For summaries of the marine projects, see the Port Authority’s annual reports for 1930–1933, and Bard, 1942, pp. 155–159. 49. The studies are summarized in the Port Authority’s annual report for 1927 (Jan. 20, 1928), pp. 13, 26–27. The agency’s chairman, George Silzer, was more optimistic about airport prospects on the New Jersey side of the Hudson. The staff study had shown that an airport in the Hackensack meadows would cost $2.6 million and would generate a loss of more than $200,000 in the first year; but “time, of course, and improvement,” Silzer conjectured, “would make it profitable.” (Port of New York, a monthly journal, July 1927, p. 26.) 50. In the late 1920s, thousands of commuters crossed the Hudson by ferry, using half a dozen ferry terminals along the New Jersey shore. Thousands more traveled from New Jersey into Manhattan by rail (via the Pennsylvania, and the Hudson and Manhattan Railroad), and once the Holland Tunnel was open, others drove into the central city. 51. “The port treaty covers passenger travel as well as freight,” he argued in a personal letter to the governor, “just as soon as the states agree on a Comprehensive Plan for passenger facilities as they have for freight. This is not generally known, but you can take my word for it. . . . ” Are “another treaty and another agency to be created?” Cohen asked rhetorically. “What for? They’ll step on each other’s toes, sure.” (J. H. Cohen, personal letter to A. E. Smith, Jan. 27, 1926; New York State Archives, 200–57.) In his more circumspect public memorandum, Cohen noted that the agency already had much to do, so its leaders would not actively seek “any further duties.” (General Counsel memorandum GC-1A, July 20, 1925, addressed to Chairman Julian A. Gregory, and intended also to be distributed to the members of the Legislative Committee on Suburban Transit for New York; the quotations are on p. 5.)

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52. The 1927 New Jersey law asked that the Port Authority submit “a legal plan” to finance transit improvements which would be carried out “through the Port of New York Authority or otherwise” (Laws of New Jersey, Chapter 277, approved March 29, 1927). The suburban transit board included the Port Authority’s deputy manager (Billings Wilson), three railroad executives, representatives from the North Jersey Transit Commission, the chief engineer of the New York City transportation system, and officials from Westchester, Nassau and Suffolk counties. (For discussion of STEB membership and activities, see the Port Authority’s annual reports for 1927 [pp. 53–59] and 1928 [pp. 62–68]; and Bard, 1942, pp. 128–134.) 53. The commissioners endorsed this position in a formal resolution, reprinted in the Port Authority’s annual report for 1928, pp. 64–66. 54. New Jersey’s interest in improved rail transit is suggested by the large numbers of the state’s residents who traveled each weekday into New York City, mainly to work locations: the New Jersey weekday total in 1927 was 302,700 each day; the Long Island sector generated 154,100 daily and Westchester 76,500. A regional plan shaped by the Port Authority seemed a reasonable strategy in New Jersey, where governments were many and fragmented and could not readily coordinate their interests. In contrast, New York City’s government, and the county governments in Westchester, Nassau, and Suffolk could plan across larger, subregional portions of the metropolis. (On the Port Authority’s activities in these years, see its annual reports for 1929 [March 20, 1930], pp. 53–62; 1930 [Feb. 10, 1931], pp. 27–28; 1931 [Feb. 15, 1932], pp. 22–24; also Bard, 1942, pp. 128–132, and the transit board and Regional Plan reports listed there.) 55. See chapters 2 and 3 above. On New York’s patronage tradition, see Seymour J. Mandelbaum, Boss Tweed’s New York (New York: John Wiley, 1965), pp. 72ff. 56. On favoritism and corruption in public authorities in the decades after World War II, see Henriques, The Machinery of Greed, 1986; also, the discussion of patronage and weakened performance at the Port of San Francisco and the Niagara Frontier Transportation Authority in the 1970s, in Doig, “The Public Authority and its Country Cousins,” 1983. Similar problems infect the semi-independent public enterprises of other countries, as illustrated in Roger Cohen, “A Sagging Italy Looks to Sale of State Enterprises,” New York Times, June 25, 1992. 57. The early New York commissioners included Eugenius Outerbridge (1921–24), Lewis Pounds (1921–25), Alfred E. Smith (1921–24), John Galvin (1923–32), Otto Shulhof (1924–27), and Herbert Twitchell (1924–28). Their New Jersey counterparts were Frank Ford (1921–24), J. Spencer Smith (1921–23), DeWitt Van Buskirk (1921–24), Julian Gregory (1923–26), Frank Ferguson (1924–45), Schuyler Rice (1924–32), and George Silzer (1926–28). The two whose occupation were not in business were Al Smith and Gregory, a lawyer who also served as mayor of East Orange, New Jersey. Silzer, Galvin, and others were also active politically. (For a detailed analysis of the values and behavior of the commissioners during the years 1921–1963, see Marvin Maurer, The Role of the Board of Commissioners of the Port of New York Authority in Policy Formation, doctoral dissertation, Columbia University, 1966. Brief biographies of the commissioners are found on pp. 374 ff. of his study.) 58. As chairman of the Port Authority in its first three years, Outerbridge was deeply absorbed in negotiations with rail executives and others, and in providing direction to the

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staff. He was also head of three business firms, and by 1924 the strain of these several tasks had exhausted him. See Cohen, They Builded Better than They Knew, 1946, p. 287. 59. The summary of this case is drawn from Cohen, 1946, pp. 249–250; quotations on p. 249. Responding in part to the Shulhof appointment, Outerbridge warned Smith that “there is only one thing” that would undercut the great potential of the Authority, a failure to keep the agency’s personnel “to the highest standard of business executives and intelligence . . . ; and that is a matter which will be entirely in the hands of the Governors of the two states.” (E. H. Outerbridge, letter to A. E. Smith, March 5, 1926; N. Y. State Archives, 200–257.) 60. J. H. Cohen, “Accomplishments and Plans of the Port of New York Authority,” address before the American Association of Port Authorities, Oct. 6, 1927, pp. 9–10. 61. To take two examples from state records in 1928: On April 17, O. H. Ammann asked the chief executive officer, John Ramsey, to authorize a new position, a stenographer, for the bridge testing laboratory in Jersey City. Information about that opening was then passed on to Governor Moore, who wrote to Ramsey, identifying a woman with “considerable experience” who should be chosen. Also, in the spring of 1928, a Port Authority commissioner was asked for advice on how to obtain a job at the Port Authority. The commissioner suggested that the interested person ask a mutual friend, Governor Moore, to send a letter of endorsement; a letter from Moore soon arrived, and the commissioner then used the letter as he sought a place for the candidate on the Authority staff. (State Archives, PA 130g, 1301.) A similar pattern characterized the administration of Governor Larson. In 1930, for example, an engineer seeking a post with the Port Authority talked with the governor and subsequently wrote to express his appreciation for Larson’s intervention on his behalf. Later that year, a lawyer seeking a position met with a senior member of the Authority legal staff, who asked him to obtain an endorsement from the governor. (State Archives, PA 1451.) 62. The 1927 statutes empowered the governor of each state to veto “any action of any commissioner” appointed from that state. Formal actions by the board of commissioners required that a majority from each state act favorably; and the letting of specific contracts, decisions on property condemnations, and most other significant actions came before the board for approval. Therefore, the veto power could, on its face, be used to halt programs that had already been endorsed and begun, as well as new proposals. On Cohen’s restrictive views, see General Counsel’s memorandum GC 14, Sept. 30, 1929; the quotations in the text are taken from this document. Cohen also cited the message of Governor Smith, when he reluctantly signed the 1927 veto act, as consistent with Cohen’s own analysis. Smith had written: “The reserve veto power in the Compact was to safeguard the states against any abuse of power by a Port Authority Commissioner. It was not intended to give the Governor of each state the power to revise their judgments. This is not compatible with either the spirit or the letter of the treaty or of subsequent legislation.” (GC 14, p. 6.) Several years later, Cohen was asked to rethink his argument, with its politically hazardous implications (if the commissioners were faced with a veto and decided to disregard it). In response, he produced a lengthy memorandum that began with discussion of the veto power as it was used in “about 494 B.C.,” considered the precedents of the Treaty of

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Hartford (1786) and international law, endorsed his earlier conclusions, and suggested implicitly that a governor who attempted to misuse the veto power would face the Port Authority (and its general counsel) in court! (General Counsel’s memorandum GC-40a, May 21, 1936.) 63. See Kenneth S. Davis, FDR: The New York Years, 1928–1933 (New York: Random House, 1985), p. 60. Roosevelt’s margin of victory over Albert Ottinger was 25,000 out of more than 4.2 million votes cast, a margin of 0.6 percent. Smith’s support for the Port agency as a promising institution, and as a precedent for the creation of public authorities to grapple with water power and other policy issues, are described in Hapgood and Moskowitz, Up From the City Streets: A Life of Alfred E. Smith, 1927, pp. 145–147, 267–276, and in Perry, Belle Moskowitz, 1992, pp. 142–143, 167–169. The quotation in the text is from Alfred E. Smith, Annual Message, Jan. 2, 1924, p. 8. 64. The New York State Bridge and Tunnel Commission drew its funds from the state treasury as part of the annual appropriations process. The New Jersey Interstate Bridge and Tunnel Commission was funded by a bond issue, which required a state-wide referendum; the bonds would be repaid ultimately from tolls on tunnel traffic. 65. Smith’s preference for the Port Authority was emphatic. The vehicular tunnel, he argued, should be “immediately turned over to the Port Authority,” which would issue bonds to complete the project; “no further appropriation for this construction should be made out of current revenues in New York State.” (Alfred E. Smith, annual message, Jan. 2, 1924, p. 10.) Smith suggested it would be a good idea to “eliminate the bridge and tunnel commission; . . . to retain it is like a second tail on a bull pup.” (Newark Evening News, Jan.29, 1924.) On Cohen’s analysis and strategies, see J. H. Cohen, confidential letter to A. E. Smith, Jan. 14, 1925 (N. Y. State Archives, 200–57); General Counsel memorandum GC-1A, July 20, 1925. See also Bard, 1942, pp. 180–184, 188–193. 66. The tunnel commissioners’ expansionary plans were encouraged by the first-year results at the Holland, which took in $4.8 million in tolls, while operating expenses were only $1.5 million. Their program included tunnels which would enter Manhattan at its lower tip; at 14th Street; between 34th and 42nd Streets; about 59th Street; and at 125th Street. See New York State Bridge & Tunnel Commission and New Jersey Interstate Bridge & Tunnel Commission, letters to F. D. Roosevelt and M. F. Larson, Dec. 28, 1928 (N.J. State Archives, Governor Larson files, PA 27f); New York Times, Dec. 29, 1928. For the Port Authority’s response, see New York Times, Jan. 10, 1929. 67. The FDR appointee was John F. Murray, a 29-year-old engineer (and protégé of Brooklyn’s Democratic leader, John McCooey), who would take the Port Authority seat opened by the death of Herbert Twitchell, a Republican. The other two New York commissioners were John Galvin, identified as a Tammany Democrat, and Howard Cullman, who had been active in fund-raising for Smith and FDR in the 1928 campaign. Republican legislators complained that FDR’s choice was a striking contrast to Smith’s effort to keep the Port board bipartisan; Smith had appointed Twitchell to the Authority in 1924. Of the three New Jersey members of the Port Authority board, two were Democrats. (See New York Times, Feb. 24, March 20, April 5, 1929.) As to the Port Authority as opening wedge, Smith had long argued that the Port Au-

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thority “model” should be used in other areas. New York State, he suggested, could use “a similar way to develop the great water power resources . . . of this State”; a “State Power Authority” would be created, given the ability to issue bonds, and urged to develop the state’s hydro-electric resources. Smith attacked the alternative, development by private companies, which might lead to a “monopoly . . . more powerful and more sinister than any which this country has known.” (A. E. Smith, annual message, Jan. 24, 1924, pp. 11–13; he made the same arguments in later addresses.) For the Republican criticisms in 1929, see New York Times, Jan. 10, 11, 1929. 68. One legislator criticized the agency for failing to provide complete financial reports to the legislature; “it should report in detail,” he said, “and not act as a sovereign in itself and responsible to no one for its vast expenditures.” Another, representing Queens, expressed concern that easier trans-Hudson commuting due to the bridge and tunnel projects would encourage those working in New York to “become taxpayers in another State”; he feared that “such migratory impulses might seriously harm the development” of New York’s own suburban boroughs. (New York Times, Jan. 10, 11, 26, 1929.) 69. The quotations in the text are taken from the statement of the executive committee of the Chamber of Commerce of the State of New York, as reported in the New York Times, Jan. 12, 1929. Letters and resolutions, urging that the two states rely on the Port Authority for all future interstate crossings, were also sent to Albany and Trenton in January and February 1929, by many groups, including the Merchants Association of New York and business associations centered around 14th Street, 34th Street, 42nd Street, and Washington Square in Manhattan, as well as by New York’s Citizens Union and business and civic leaders in Bergen County. (For collections of these materials, see New Jersey State Archives, Larson files: Bridge & Tunnel Commission.) 70. New York Times, editorial, Jan. 11, 1929. The editors admitted that the Port Authority’s other endeavors had not been as successful: “It is true that progress in bringing order out of the confusion of the port has been slow.” A few weeks later, the Times expressed its disappointment at the “meager” progress in carrying out the Comprehensive Plan; in contrast, the bridge projects “stand out in shining colors” (editorial, Feb. 25, 1929). 71. See New York Times, Jan. 10, 11, 18 and 20, 1929. On the Manhattan Republican breakaway, see A. Int. 62 (1929), known as the “Moffat Bill”; Abbot Low Moffat, “Interstate Bridges and Tunnels,” Feb. 6, 1929 (Port Authority Library, DOC 29–1012); and the author’s interview with A. L. Moffat, Sept. 8, 1987. 72. On the agency’s political support in New Jersey, see New York Times, Feb. 22, 24, 1929. 73. “I do not mean that the Bridge and Tunnel Commission should be thrown into the discard,” FDR explained in announcing his preferred solution, “and all its functions transferred to the Port Authority.” The plan was simply “a wedding between the two bodies,” which would bring about “a removal of confusion or unnecessary friction and of unseemly rivalry . . . ” (New York Times, Jan. 17, 1930). See also Cohen, 1946, pp. 262–264. The merger idea was probably Cohen’s. The tunnel commissions had pressed their case in both states; for example, the chairman of the New Jersey commission wrote to his governor, noting that the tunnel bodies were “working splendidly,” and were “well able to direct the tunnel operations and to safe-

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guard New Jersey’s interests” (T. Boettger, letter to M. F. Larson, Dec. 2, 1929; State Archives, Larson, 27b). On their final hope for independent action, see New York State Bridge and Tunnel Commission and New Jersey Holland Tunnel Commission, press release, Jan. 13, 1930. 74. New York Times, Jan. 18, 1930. The developments in the early weeks of 1930 are discussed in the New York Times, Jan. 18, 20, Feb. 15, March 7, 1930. 75. See New York Times, March 7, 16, 1930. As veteran reporter Guy Savino later recalled, one of the tunnel commissioners, Alexander Shamberg, bitterly resisted the idea of merging. In Shamberg’s view, placing “the successful Holland Tunnel under the then unsuccessful Port Authority was a huge mistake.” Shamberg’s comparison was presumably based on the strong revenue position of the Holland Tunnel in 1929–30, compared with the thin trickle of toll fees on the Staten Island bridges, and the failure of the Port agency’s major freight plans. (See Guy Savino, “Holland Tunnel’s Fortieth,” Newark Sunday News, Nov. 12, 1967, p. 7.) 76. The Port Authority emphasized this fear—which it labeled as “unfair competition” between the two bodies—in its annual report, released early in 1929. During the next year, it sought the views of investment banks on the question of issuing bonds to finance the midtown tunnel, and in early March 1930, it announced the results. Investment houses said that Port Authority bonds could be issued to finance a new crossing, but they warned that “the investing public” would be wary if the Holland Tunnel continued to be operated by a separate agency which might reduce the tolls or make the tunnel “toll free.” (See Port Authority, annual report, Feb. 15, 1929, p. 61; and letter from National City Company to J. E. Ramsey, Feb. 24, 1930 [quotation above is on p. 1]; letter from Kissel, Kinnicutt & Co. to J.E. Ramsey, Feb. 24, 1930; and statement of J. E. Ramsey, Port of New York Authority, released to the press March 6, 1930.) 77. These several steps are recorded in Laws of New York, 1930, chapters 420, 421, and 1931, chapters 47, 48; also, Laws of New Jersey, 1930, chapters 247, 248, and 1931, chapters 4, 5. See also Bard, 1942, pp. 189–192. 78. See Laws of New York, chapters 418, 419 (April 12, 1930); Laws of New Jersey, chapters 244, 246 (April 21, 1930). Although the expanded board included six from the tunnel group, the board leadership of the Port Authority—with John Galvin as chairman and Frank Ferguson as vice-chairman—remained intact, and the tunnel staff now reported to the Port Authority’s department heads. 79. The building, between Eighth and Ninth Avenues, would receive freight packages by “shuttle” trucking from the railheads of “all railroads entering New York,” the Port Authority asserted. Packages would then be sorted, and deliveries from all railroads could travel from the inland terminal to each merchant in a unified delivery. Outgoing freight from all merchants would be brought to the inland terminal, where it would be “classified and grouped for shipment by individual railroads” (Port Authority, annual report, Feb. 10, 1931, pp. 43–45). 80. New York Times, March 22, May 1, 1931. Since most of the funds came from Holland Tunnel tolls, the credit might reasonably have gone to another agency, but it was now under ground.

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81. The announcement took place as part of a ceremony which underscored the close ties between the Port Authority and its bondholders. On June 23, forty bankers became the first individuals (other than Port Authority personnel) to walk across the bridge, over a mixture of planks and concrete roadways. As representatives of life insurance and other institutions that had purchased $50 million in Port Authority bonds, they had been invited “to examine what had been done with the money.” The New York Times reported that “as they walked they discussed the view, the stock market and the desirability of the bonds now being issued by the Port Authority to finance the construction of the new union freight terminal.” (New York Times, June 24, 1931.) 82. Morgan F. Larson, “New Jersey Speaks,” and Franklin D. Roosevelt, “New York Speaks,” New York Times, Oct. 18, 1931. 83. Quotations and other information on the dedication are taken from the New York Times, Oct. 25, 1931. 84. See Port Authority, annual report for 1931, Feb. 18, 1932, pp. 13–14, 55–63 (quotation at 57); and Bard, 1942, pp. 238–244. 85. Erwin C. Hargrove, “David Lilienthal and the Tennessee Valley Authority,” in Doig and Hargrove, eds., Leadership and Innovation, 1987, p. 47. See also Philip Selznick, Leadership in Administration, 1957, pp. 151–52. 86. Kaufman, “Emerging Conflicts in the Doctrines of Public Administration,” American Political Science Review, 50 (December 1956), pp. 1057–1073. 87. As Cohen argued, to be able to borrow money based on the Port agency’s projected earnings requires “public confidence in the integrity and efficiency of the men in the institution.” (Cohen, 1927, p. 10.) 88. See Selznick, 1957, pp. 151–152; Hargrove, 1987, pp. 47 ff.; and Erwin C. Hargrove, Prisoners of Myth: the Leadership of the Tennessee Valley Authority, 1933–1990, 1994, pp. 5 ff. 89. Quasi-competitive because the ICC was influential in restraining competition in rates and services. As one recent study comments, under the review authority of the Commission in the early twentieth century “rate wars were averted . . . and risk to rail investors was significantly reduced.” From the railroads’ point of view, the author concludes, “ICC regulation had about it the quality of a government cartel.” (Theodore E. Keeler, Railroads, Freight, and Public Policy [Washington, D.C.: Brookings Institution, 1983], p. 23. 90. Selznick argues that “creative leadership” involves “transforming men and groups from neutral, technical units” into participants who have a broader understanding of the organization’s purposes and a commitment to achieving them. He is doubtful that this kind of commitment can be attained “in organizations that have narrow, practical aims and whose main problem is the disciplined harnessing of human energy to achieve those aims” (Selznick, 1957, p. 150). As this chapter and later chapters illustrate, the narrow aims of building bridges, creating bus terminals, and modernizing airports can be harnessed to the broader themes of leadership described by Selznick in his classic 1957 book. 91. See the Epilogue in this volume, and Danielson and Doig, New York, 1982, chapters 4 and 10. (For the quotations from Herring, see the headnote to this chapter.)

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Chapter 8 1. As quoted in Arthur M. Schlesinger, Jr., The Coming of the New Deal (New York: Houghton Mifflin, 1958), p. 2. 2. Letter of transmittal to the governors and legislatures of the States of New Jersey and New York, Annual Report for 1932, pp. 14–15. 3. See Macleish, “Port of New York Authority,” Fortune, September 1933, p. 119; New York Times, editorial, Jan. 31, 1936; New York Times, Dec. 22, 1937; New York Times, June 28, 1940. The Port Authority’s 20th anniversary in the spring of 1941 prompted a spate of further favorable comments from editorial writers and civic groups. 4. Bard, Port of New York Authority, 1942, pp. 320, 327. 5. A single tube was not very satisfactory from the perspective of traffic efficiency and safety. It had only two lanes, with traffic moving in single file in two directions; and a breakdown in one lane would often lead to blockages that affected both lanes. As to the Port Authority’s earlier optimism, see for example the New York Times, Jan. 10, 1932. 6. For 1938, the first tube showed a gross income of $1.1 million, operating expenses of $658,000, and interest costs of nearly $1.3 million—for a net deficit of $954,000. In 1939, it ran a deficit of $625,000. (Port Authority, Annual Report for 1938, p. 32; Annual Report for 1939, p. 39.) Roger Gilman was one of the staff members assigned to monitor traffic flowing through the tunnel in its opening months. He later recalled how concerned the agency was at the slow trickle of cars: “We were only seeing a thousand dollars in tolls a day, far less than we needed.” (Author’s interview, 1986; and see “Lincoln Tunnel,” New Yorker, Jan. 4, 1988, p. 21.) 7. The Authority declared that businesses with “merchandise display rooms, stock rooms or manufacturing facilities” would find “in this modern building . . . an opportunity heretofore unavailable for consolidating all their activities under one roof and effecting economies in the conduct of business, particularly shipping and distribution.” (Port Authority, Annual Report for 1932, p. 61; New York Times, Sept. 17, 1932.) 8. In early April, the Port Authority’s vice chairman, Howard Cullman, wrote to Roosevelt’s Secretary of Commerce, noting that the railroads’ marine equipment was operated by “nine different operating heads,” resulting in “a large measure of waste and inefficiency.” He argued that the rail executives “have consistently refused, because of individual railroad rivalry, to establish reciprocal switching along the New Jersey waterfront.” (New York Times, April 5, 1933.) Cullman’s sharp criticisms conveyed the widespread frustration among Port Authority commissioners and staff toward the railroads’ behavior, but his comments also illustrated his own impatience and his desire to press ahead with the bi-state agency’s broad mission—personal attributes which would have a crucial impact a decade later in reshaping the Authority’s leadership and strategies. A few days later, the Port Authority criticized the railroads for their “determination to retain their individual terminal facilities and services,” and urged that a national coordinator be named “with plenary powers” to force action. (New York Times, April 15, 1933.)

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The national rail picture was disheartening. Between 1929 and 1933, the nation’s railroads endured a 51 percent decline in revenue. Insurance companies and other major creditors urged that competition among rail lines be moderated, but “the railroads were not in a mood . . . to undertake cooperative projects for the reform of the industry. Jealousy, suspicion, and an unwillingness to submerge private interests . . . prevented this.” (Earl Latham, The Politics of Railroad Coordination: 1933–1936 [Cambridge: Harvard University Press, 1959], pp. 8, 12.) 9. “So long as there are separate corporate entities,” the railroads argued in 1936, each railroad must “protect and promote the welfare of its individual interests.” Rail executives resisted the suggestion that they might “surrender an advantage, real or imaginary, in strategic location,” or “share that advantage with a competing carrier under unified operation” (Latham, 1959, p. 258). Eliminating the Federal Coordinator was relatively easy; the position had been created on a temporary basis in 1933, and in 1936 legislation was required to maintain the post. When no action was taken, the office lapsed. 10. Because of the weak real estate market, the bi-state agency found it difficult to attract and keep tenants on the upper floors, except by charging very low rent. The building was “a disaster,” recalls Mortimer Edelstein, who was a Port Authority staff member in the 1930s; it was “filled with stolen tenants at bargain rents” (letter to the author, June 10, 1984). Whether it would have been more efficient for the rail lines to use the Port Authority terminal more extensively is not entirely clear; a careful review of the freight-handling methods available in the 1930s leads at least one expert in the field to conclude that use of the union terminal would, in many cases, have required “one additional handling,” increasing railroad costs. (Clifford O’Hara, formerly Director of Port Commerce at the Port Authority, memoranda to the author, Nov. 25, 1991 and March 16, 1993.) On the rise and fall of the inland-terminal plans during the 1930s, see the agency’s annual reports and Bard, 1942, 111–128. 11. The three Staten Island spans were generating large deficits, and, as general manager John Ramsey announced early in 1935, “The Holland is the only facility at present which is producing a surplus for the general reserve fund” (New York Times, Feb. 26, 1935). In addition to the general traffic decline linked to the Depression, the Staten Island spans were affected by completion in 1932 of New Jersey’s Pulaski Skyway, a state roadway without tolls, which provided trucks and automobiles with a fast route to the Holland Tunnel, as they traveled north from the Philadelphia area. (Before the Pulaski, these drivers would often avoid local congestion by using two Port Authority toll spans: they would cross onto Staten Island at the southern end, via the Outerbridge Crossing, travel north on uncluttered highways, and then use the Bayonne Bridge, which joins the northern end of Staten Island to Hudson County a few miles below the Holland.) On the agency’s early cost-cutting efforts, see New York Times, Jan. 8, 1932, May 21, 1932; Port Authority, Annual Report for 1932, pp. 14–16. For an overview on the problem of weak bridge traffic and the agency’s financial situation throughout the Depression, see Port of New York Authority, “Report Submitted to the New Jersey Joint Legislative Committee,” June 1940, 97 pp.; see also Bard, 1942, pp. 246–266, and Cohen, 1946, pp. 312–314.

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12. The 1935 refunding scheme was mainly the brainchild of Leander Shelley, Cohen’s top assistant, who worked with David Wood, a leading Wall Street municipal bond lawyer. “Shelley was the genius who put [the plan] into being,” recalls his aide, Mortimer Edelstein; “but for that maneuver PNYA would have gone down the drain.” (Edelstein letter to the author, June 23, 1987.) By early 1941 all the original bonds had been refunded. The refunding program is summarized in the agency’s document, “The Port of New York Authority: A Monograph” (1936), pp. 29–39, and in Bard, 1942, pp. 253–264. 13. For information on the work of this body, the Suburban Transit Engineering Board, see the Port Authority, Annual Report for 1931, pp. 16–18, and Bard, 1942, pp. 128–132. 14. Larson had served as governor from January 1929 until January 1932, and the story of his appointment to the Port Authority staff was carried on page one of the Newark News, May 12, 1932. “When things like this are done,” commented one letter writer to the News, “is it any wonder that the public gets disgusted with politics?” (Newark News, May 16, 1932.) The Port Authority’s public response to the critics did little to allay concern. The agency noted that it had recently “reduced wages and laid off a number of men” and was in the process of releasing its consultants as well; however, it argued that Larson would be “a most valuable accession to our staff of advisors” because of his “intimate contact with our plans and programs, both as Senator and as Governor,” and his “understanding of the highway system of New Jersey . . . ”(May 18, 1932). These documents are filed in the New Jersey State Archives, Governor Moore files, Book #80. As to patronage at lower levels, political connections were probably important in the appointment of two members of the law-department staff, and party influence can also be identified in staff appointments in the police and real estate divisions. (See author’s interview with William Pallmé, a member of the legal staff in the 1930s, Nov. 4, 1987, p. 20.) 15. General port planning issues were the responsibility of Walter Hedden’s Bureau of Commerce, a unit of the Development and Operation Department, headed by Billings Wilson, who reported directly to the General Manager, John Ramsey. Galvin reported separately to Ramsey, as a director without a department or professional staff. (See New York Times, Nov. 17, 1933, May 1, 1934; listings of staff members in the annual reports, 1933–1936; and the organization chart in the agency’s “Port of New York Authority: A Monograph” [1936], p. 15.) 16. See New York Times, March 6, 1932, June 22, 1933. The New Jersey-to-Brooklyn rail tunnel was a central element of the Comprehensive Plan; see chapter 4 above. The Port Authority’s response to the Brooklyn attack was slightly out of touch with reality, though perhaps it was politically soothing. Now that the inland terminal was completed, the agency explained, it was prepared to negotiate with the railroads to carry out the larger project. “We have never been more hopeful or encouraged about the . . . tunnel,” averred the agency. The Times story carried a headline which advertised the charade: “Port Ready to Push Freight Tube Plan” (New York Times, Oct. 23, 1932). 17. The Times’ headlines captured the ICC examiner’s main themes: “FREE LIGHTERAGE CONDEMNED HERE: ICC Examiner Upholds New Jersey and Boston Protests on New York Practice: Money Loss Pointed Out: Impairing of Investments Laid to ‘Unfair Advantage’—Minimum Rates are Prescribed. Victory Acclaimed in Jersey” (New York

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Times, Jan. 29, 1933). For early Port Authority and New York reactions, see New York Times, Jan. 29, Feb. 6, 1933. 18. New York Times, Jan. 29, Feb. 8, May 23, 1933. During the ICC appeal, the Port Authority attempted to support the concept of a unified port while avoiding further antagonizing New Jersey interests; see its Annual Report for 1933, p. 32, and Annual Report for 1934, pp. 24–26. 19. The Port Authority’s decision not to intervene in this final round was the result of its policy rules. All six New York commissioners supported intervention, in favor of free lighterage; and on the New Jersey side, three of the six commissioners agreed. So the count was 9–3. Sensitive to state interests, however, the Compact permitted the Authority to act only if a majority of voting members from both states concurred; therefore, the 3–3 New Jersey vote barred the agency from taking part in the case. (See New York Times, April 25, 26, 27, 1940, and a confidential “Memorandum for the Commissioners,” Sept. 27, 1944, pp. 24–25 and Appendix II.) 20. “We have set tolls at a level which we think is proper,” Ferguson concluded; “the woods are full of people who try to tell us how to run our business” (New York Times, Oct. 6, 1938). His ally was New York Commissioner Rudolph Reimer, quoted in the New York Times, March 24, 1939. Reimer argued that the Port Authority “does not build tax-eaters” and “does not depend upon handouts, grants or subsidies.” On local criticisms of the agency’s tolls, see New York Times, August 25, 1937, July 18, 24, 1938. 21. As a warning, the Authority pointed to the subway fare in New York City, which had become “an important political issue” and so had been held at five cents for many years, requiring that “the general taxpayer” meet the gap between fare revenues and the actual cost of the subway system. (See Port of New York Authority, “Report Submitted to the New Jersey Joint Legislative Committee Appointed Pursuant to the Senate Concurrent Resolution Introduced March 11, 1940,” June 7, 1940, pp. 1, 9, 24.) 22. Report of the New Jersey Joint Legislative Committee (appointed pursuant to Senate Resolution No. 5), Dec. 22, 1940. The committee made other recommendations, discussed later in this chapter. On the Port Authority’s arguments cited in this paragraph, see its “Report . . . ,” 1940, pp. 15 ff. A few months later, it concluded that toll rates might be reduced sometime after 1945, “if current tolls and earnings are maintained” (Port Authority, Annual Report for 1940, Feb., 1941, p. 78). 23. Ferguson, born in 1883, had spent most of his career in Jersey City banks, and he had campaigned against the creation of the Port Authority in 1920–21. In 1924, Governor Silzer appointed him to the agency’s board of commissioners, and he soon became a public supporter of its activities. Reappointed in 1930 by Morgan Larson and in 1936 by Harold Hoffman, both Republicans, Ferguson also maintained friendly connections with Jersey City’s Democratic machine, which obtained a modest flow of patronage appointments. Cullman, born in 1891, was a member of the wealthy Cullman tobacco family, and organized financial support for the gubernatorial campaigns of Al Smith, who appointed him to the Authority board in 1927. In the 1920s, Cullman took a leading role in reorganizing a nearly bankrupt hospital, and in the 1930s he and his wife Marguerite began a long career as investors in Broadway theater productions. (Information on Ferguson and Cull-

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man is taken from the “Commissioners’ files,” Port Authority executive offices; on Cullman, see also a long obituary, New York Times, June 30, 1972, and author’s interview with Marguerite Cullman, May 4, 1984.) Ferguson’s predecessor, John Galvin, was a prominent member of the Tammany-controlled Democratic Party in the early 1900s, ran unsuccessfully against reformer John Purroy Mitchel for president of New York City’s board of aldermen in 1910, and served on the city’s water supply commission. In 1923, responding to complaints from local political leaders that they should be directly represented on the Port Authority board, Governor Al Smith appointed Galvin to the seat that Smith had held in 1921–23. As noted earlier, Galvin resigned as board chairman to become a paid consultant to the Authority. See Cohen, They Builded Better Than They Knew, 1946, pp. 274, 307, and Maurer, The Role of the Board of Commissioners of the Port of New York Authority in Policy Formation, 1966, pp. 65, 69, 376. 24. During the 1938 doldrums, one staff member recalled, “when a few extra cars came through the Lincoln Tunnel, it was a cause for celebration!” (Roger Gilman, interview with the author, Feb. 1984.) 25. On Wilson and the agency’s planners, see Roger Gilman, author’s interview, Feb. 10, 1984; Edelstein, author’s interview, April 30, 1984; Bard, 1942, pp. 293, 320. Edelstein recalls Wilson as a “big detail man” who kept a yellow pad with long lists of things to do, “filling every line,” and crossing off the items as they were completed. 26. While supervising construction of the Lincoln Tunnel in the 1930s, Ammann also served, in collateral duty, as chief engineer of Moses’ Triborough Bridge Authority, where he was responsible for construction of the Triborough and Bronx-Whitestone bridges. When work on the second tube of the Lincoln was halted in 1938, most of his engineering staff departed, and in 1939 Ammann retired and established a private consulting firm. 27. The request from Trenton to study rail transit came as interstate commuter traffic turned upward, and the agency submitted a report in 1937. It also cooperated in a rail transit study which began in 1939. (See Port Authority, Annual Report for 1937, pp. 19–21, Annual Report for 1939, pp. 20–21; Bard, 1942, pp. 132–134.) The airport study is summarized in Port Authority, Annual Report for 1938, p. 21. 28. In the fall of 1938, a shippers’ group asked the Port Authority to examine the idea of regional truck terminals, as a way to reduce traffic congestion; more than a year later, the Port agency began a study. In 1939, New York City’s Mayor LaGuardia appointed a committee to examine ways to reduce traffic congestion due to the great number of buses traveling from New Jersey into midtown Manhattan, primarily via the Lincoln Tunnel, and the Port Authority agreed to take part in the project. (Port Authority, Annual Report for 1939, pp. 19–21; Bard, 1942, p. 128.)

Chapter 9 1. “Two different approaches developed in our own ranks,” Cohen later recalled, writing about the Port Authority in the 1930s, “one based on fear, the other on faith. Faith was justified, as events subsequently proved. But had we taken the temper of the defeatists, we should have fulfilled their prophecy and gone under.” Cohen, They Builded Better Than They Knew, 1946, p. 314.

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2. This discussion of the “distinctive values” of an organization draws primarily on the work of Philip Selznick. His analysis is focused on the need to provide protection for those important values that might be weakened under the pressure of the dominant culture within an agency. For example, in an organization that habitually distorts financial information, a revitalized accounting division will need to be nourished and safeguarded, probably by having it report directly to a top official, until the “precarious value” (financial integrity) becomes ingrained in the behavior of most staff members. Selznick explores the variety of challenges to institutional integrity which are likely to come from both internal and external threats. (See Selznick, Leadership in Administration, 1957, especially pp. 94–95, 119–133; the quotation in the text is on p. 119.) 3. See “Veteran Will Quit Kings Court Post,” New York Times, Sept. 25, 1949; also interview with Stacy Tobin Carmichael, Dec. 1983. His early advice came from John H. McCooey, a rising star in Brooklyn’s Democratic Party, and for twenty years (1908 ff.) the head of the Brooklyn political machine. McCooey was Clarence Tobin’s chief patron. (McCooey’s activities are described “Profiles: The Emerald Boss,” New Yorker [March 12, 1927], pp. 25–28.) 4. “Three days away from H.C. and in Brooklyn and not a slip-up on either end,” Tobin wrote, after one forbidden absence during term; “for the H.C. triumph over the Jebs and their vigilant system I owe a good bit to the maneuvers of Joe and Al.” (A. J. Tobin, letter to G. T. Farley, May 9, 1924.) A year later, facing the mandatory senior retreat, which conflicted with his fiancee’s college graduation, he commented: “If I haven’t amassed enough Jesuit strategy and counter-strategy in four years to out-wit the Jesuits themselves for one all-important evening—I neither deserve nor want my degree.” (Tobin letter to Farley, April 27, 1925.) His efforts to evade Jesuit strictures did not always work, however. His brother Bill recalled that their father was asked to visit the Prefect of Discipline at Holy Cross on one occasion, to hear the details of his son’s behavior while “entertaining” fellow students at a Greek restaurant near the campus; and he thought there were other similar fatherly visits. Information on Tobin’s early years comes from his letters (1923–25) to his fiancee, Geraldine T. Farley; the Holy Cross College Archives, and discussions with the archivists, Revs. Eugene J. Harrington, S.J. (in 1984), and Paul J. Nelligan, S.J. (1990), as well as two letters (1984) from Father Harrington; the College literary magazine, The Holy Cross Purple (1922–25); discussions with his high school and college friends, John J. Fitzgerald Jr., Paul J. Fitzgerald, and Thomas M. Lamb, together with five letters from John Fitzgerald (1983–84); a letter from Miles McDonald, a friend in Brooklyn (1984); and discussions with members of Austin Tobin’s family: his daughter Stacy Tobin Carmichael (1983 ff); his son Austin Tobin Jr. (1984 ff); his brother William (1984–85); and his sister-in-law, Janet Tobin (1984). 5. The Index Librorum Prohibitorum was prepared at the Vatican, and revised every few years, to identify “erroneous and immoral books” which should not be owned or read by members of the Church; the 1922 edition, available at the Holy Cross College library, includes among prohibited books the works of Immanuel Kant, Jean-Jacques Rousseau, and Emile Zola, and hundreds of others. 6. “Spartacus to the Gladiators,” an essay on the burdens of leadership, and “The Dukite Snake,” a tale of revenge. One school friend comments, “These selections may

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have been an indication of what was on his mind as a very young man.” Letter to the author, Dec. 22, 1983. “Spartacus” is reprinted in George L. Raymond, The Orator’s Manual, 1879, pp. 219–222. 7. In a 1922 essay, for example, Tobin wrote: “They say that Broadway used to be a cow path; a cow path that leisurely wound its way out from the little settlement of New Amsterdam, while down below it the lordly Hudson swung serenely by in all the majesty of a monarch. . . . But we have changed all that. We have made Broadway a mass of stone and steel; a mighty canyon riven in rock wherein the ceaseless, hurrying multitudes toss to and fro like a surging torrent. And o’er the bosom of the Hudson we have stretched our docks in black, skinny fingers.” A.J. Tobin, “Lost—Between Camelot and New York,” The Holy Cross Purple, December, 1922, p. 192. 8. To ensure a large dance turnout, he would buttonhole dozens of his classmates and persuade them to attend. His activities in organizing the Brooklyn Club Dance, the Jersey Club Dance, and the Easter Dance in 1924–25 are described in his letters to G. T. Farley, Oct. 16, 1924, Dec. 1924, and n.d. [April 1925?]. 9. “We returned from Brooklyn after one holiday,” a classmate recalled, “and Austin discovered that the seniors were running a crap game. He immediately joined in, and came out $200 ahead. Of course he lost it gambling in the next ten days.” (Interview with the author, Dec. 4, 1983.) 10. “I immediately have to go down town and hire eight dray horses and some costumes and an old hack,” he wrote to Gerry. “We are going to put on, between the halves, a mock arrival and reception of H.R.H. Eddie [the Prince of Wales], followed by a delicious polo game.” (Tobin letter to G. T. Farley, Sept. 24, 1924.) A few days later, he sent a note to say that he had to “keep notes on the game and then dash up to the Hall and take off my makeup . . . and beat it down to the city to the telegraph office, where I composed the detailed account of the game for the Globe.” (Tobin letter to Farley, Sept. 27, 1924.) During his senior year, Tobin wrote articles for the Boston Globe on Holy Cross sports events. For his reports on the Fordham and other events, see Tobin letters to Farley, Oct. 1, Oct. 23, 1924. 11. Austin had known Gerry Farley since their high school days in Brooklyn, and he had been courting her since his junior year in college. The “official” wedding took place in the fall of 1925, but according to their friends, it is likely they had been secretly married during their senior year by a priest, a friend of the family, who was willing to forego the banns. Holy Cross rules prohibited students from marrying, and if the Jesuit Fathers had learned of the marriage, Austin would have been required to leave college. Perhaps this incident again illustrates Austin’s taste for risk. Much of Austin’s distaste for local political gatherings was no doubt due to the traditional standards of social behavior which his family and teachers had emphasized (for example, “men always remove their hats when indoors”). But local party machinations and occasional corruption also cut against the grain of “purist” ethical standards which Austin had developed by the time he was twenty—and which he later employed as guide and whip at the Port Authority. One letter in 1923 illustrates his perspective: “I believe a tremendous percentage of the people of today to be morally rotten. The vast majority of them . . . indulge to the utmost their bestial instincts. The number of men

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one meets who have but two thoughts in life—business and animality—is appalling. . . . Of course it’s all rather horrifying and disgusting when viewed as frankly and honestly as I have pictured it above.” (Tobin to Farley, Oct. 25, 1923.) 12. With the backing of Brooklyn leader John McCooey, Austin’s father was chosen as official stenographer at the Democratic National Convention in 1916, when Wilson was nominated for a second term. Subsequently he made a courtesy visit to the White House and took Austin with him for a meeting with the President. (New York Times, Sept. 25, 1949, and recollections of Austin Tobin, reported by his son, author’s interview, October 1987.) 13. Tobin’s early optimism is conveyed especially clearly in his Salutatory Address at the Holy Cross Commencement: “Our confidence in the future arises from knowledge. . . . The history of nations gives ample testimony that ours is no common fortune. We are children of a halcyon day and state in the history of the world. . . . We are determined and confident that this heritage shall be passed on, not only undiminished, but ever with increase” (printed in The Holy Cross Purple, June 1925, pp. 724–729). The address also includes a series of comments on the “passion for liberty of conscience” and the right of Americans “to worship as they willed” which are viewed, by some of Tobin’s close friends, as criticisms of Church doctrines of the 1920s. 14. Tobin, “The Next Decade in Brooklyn,” address at the Annual Meeting of the Downtown Brooklyn Association, Jan. 28, 1957, p. 3. 15. During these years, two children were born, Austin Jr. in 1927 and Stacy in 1928. On the patronage demand, see the handwritten note to Cohen, dated February 1927, asking that the open position be used to meet a political debt (in the files of Austin J. Tobin, Jr.). 16. See chapter 8 above, and Bard, Port of New York Authority, 1942, especially chapter 10. 17. Joseph Lesser, “Great Legal Cases Which Have Shaped the Port Authority,” Port Authority Review (Fall 1969), p. 5; and see Bard, 1942, pp. 27, 280. 18. In McCulloch v. Maryland (1819), the Supreme Court under Marshall established the rule that state governments could not tax agencies of the national government. In Collector v. Day (1871), the Court ruled that the salaries of state-court judges were immune from a national income tax, thus establishing the doctrine of “reciprocal immunity”—barring both national and state governments from taxing the salaries and activities of one another. In Pollock v. Farmers’ Loan and Trust Company (1895), the Supreme Court concluded that the national government could not tax income received by individuals, if that income came from moneys they had invested in municipal bonds. A series of further decisions in the early twentieth century blocked various state, local, and national taxes that indirectly might burden the operations of other governments; one of the more extreme was the Supreme Court decision in 1931 (Indian Motocycle v. U.S.), which struck down a federal sales tax on motorcycles if they were purchased by a city government for use by its police department. [The unusual spelling is correct.] 19. Thus in South Carolina v. United States (1905), the Supreme Court upheld a federal license tax on liquor sold out of the state’s own stores. In that opinion, the Court concluded that “the exemption of state agencies . . . from national taxation is limited to those

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which are of a strictly governmental character, and does not extend to those which are used by the state in carrying on an ordinary private business.” On the Court’s recurring attempts to divide governmental activities in this way, see Samuel J. Konefsky, Chief Justice Stone and the Supreme Court (New York: Macmillan, 1946), pp. 25–47, and Alpheus Thomas Mason and William M. Beaney, American Constitutional Law (Englewood Cliffs, NJ: Prentice-Hall, 1978), pp. 136–139. 20. “The bonds or other securities issued by the Port Authority shall at all times be free from taxation by either State.” The sentence appears in Section 8 (Laws of New Jersey, 1922, chapter 9; Laws of New York, 1922, chapter 43). On tax questions affecting the Port Authority, a brief summary is in Bard, 1942, 272–279. 21. The Port Authority had offered to purchase the line and related waterfront property for $1 million by issuing bonds, secured only by future income from the properties. The War Department demanded cash, which the Authority did not have, and set other conditions that were unacceptable to the agency. Negotiations ended in 1926, and the next year the Hoboken properties were sold to a private company. See chapter 5 above; also Bard, 1942, pp. 144–158, 272–274; Port Authority, Annual Report for 1925, pp. 6–7. 22. “The construction, maintenance and operation of said bridges is in all respects for the benefit of the people of the two States . . . and the Port Authority shall be regarded as performing a governmental function in undertaking said construction, maintenance, and operation . . . and shall be required to pay no taxes or assessments upon any of the property. . . . ” (Laws of N.J., 1925, chapter 37, sec. 7; the same phrasing occurs in the New York statute and in the 1926 and 1931 laws in both states.) 23. “Inland Terminal No. 1” occupied the lower two floors of the building, which extended from Eighth Avenue to Ninth Avenue, between 15th and 16th streets. On the planning and early history of the terminal, see chapter 8, and the Port Authority’s annual reports for 1929 (pp. 9–14), 1930 (pp. 15–16, 43–45), 1931 (pp. 41–42), and 1932 (pp. 17–18); also Bard, 1942, pp. 120–122. 24. The earliest detailed statement of Cohen’s thinking on this issue is found in GC 17 (Jan. 17, 1930), one of a series of General Counsel’s opinions provided to the Port Authority Commissioners during the years 1921–1942. (The GC series is on file in the Port Authority’s law department; I am indebted to Gerald L. Fetner for making his set available for my use.) 25. The Port Authority’s “in lieu” payments are authorized in Laws of N.J., 1931, Chapter 69; Laws of New York, 1931, Chapter 553. 26. Soon after the states passed the “in lieu” statutes, Cohen began to point to this implication. For an early example, see his September 1932 memorandum (GC 24), prepared for the Reconstruction Finance Corporation as part of the loan application for constructing the Lincoln Tunnel. After quoting the state laws that exempt the bridges and tunnels from taxation, Cohen continued: “I should add also that the two states have recognized the inherent exemption of the Authority, as a governmental instrumentality, from state and local taxation, and found it necessary to adopt legislation . . . in order that the Authority might be authorized to make payments to municipalities. . . . Moreover, the power is only granted in the case of marine and inland terminal property. It therefore has no application to the Midtown Hudson Tunnel, except as a recognition of the fact that Authority property is per se exempt from local taxation” (p. 16).

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27. “There was something special about him,” recalled one member of the team, Rose Lewin Hershdorfer. “He never spoke down to anyone. He had a humility.” And, she remembered, “there was his intensity. He had drive, though it was low-keyed.” As a result, “we worked like Trojans. We worked evenings, weekends, holidays.” Yet it was all done with “a sense of camaraderie.” (Author’s interviews, Dec. 22, 1983, May 21, 1985.) Rose Lewin was a legal secretary in Tobin’s division, 1928–42; later she was his assistant in the executive director’s office. 28. The information on Tobin’s approach is drawn primarily from the recollections of William A. Pallmé (1987–88), who graduated from Harvard Law School in 1928, specialized in real estate litigation while working in a New York law firm, and joined the Port Authority as Tobin’s assistant in 1930; he remained at the Port agency until about 1965. The quotations in the text are taken from Pallmé’s memorandum to the author, Feb. 22, 1988. On the land acquisition process for the inland terminal, see also Port Authority, Annual Report for 1930, pp. 64–66. 29. I have the Clarence Tobin story from Pallmé (memorandum to the author, Feb. 22, 1988, p. 4). The discussion of the Bush Terminal case is based on documents and on information provided by Pallmé and by Daniel B. Goldberg, who joined the law department in 1935 (author’s interviews, 1983–84). For the criticisms of the terminal cited in the text, see the resolution of the Central Mercantile Association, quoted in the New York Times, Jan. 20, 1933. In contrast with the Port Authority’s proposed $60,000 payment, taxes based on the assessed value of the completed building would have been about $400,000 for 1933. 30. “He was a nonconformist in small things as well as in large,” Pallmé reflected years later. Among small things, Pallmé recalled the story of the spittoons: In 1933, when the Port Authority moved its offices into the completed Eighth Avenue building, staff members found in each room a cuspidor or spittoon, traditionally used for spitting by tobacco chewers. These were “highly objectionable to Austin and me,” Pallmé said, and they took them into the hallway each evening, only to find them back in their rooms the next morning. One evening, instead of taking the spittoon into the hallway, Tobin opened his window, gauged the distance, called “here goes!,” threw his spittoon out, and watched it land on the roof of a vacant building next door. “Reilly and I followed suit and we never saw the spittoons again.” (Pallmé, memorandum to the author, Feb. 22, 1988, p. 5.) 31. See Bush Terminal Co. et al. v. City of New York and The Port of New York Authority, Supreme Court [trial court], New York County, 152 Misc. 144 (June 20, 1934). The business firms argued that “any exemption . . . granted to the Port Authority in connection with the said building will enable it to unfairly compete with these plaintiffs in renting manufacturing, storage and office space,” thus violating the due process clause of the U. S. Constitution (Bush Terminal Company, et al., Complaint, para. 34). Bush and New York Dock were immense operations. The Bush Company had 103 warehouses, a network of piers with rail track connections (35 miles of its own track), 10 car floats, and a fleet of motor trucks. New York Dock had even more warehouse space and extended along two miles of the Brooklyn waterfront; in the mid-1930s, New York Dock handled about onequarter of the ocean freight tonnage of the bi-state port. Unfortunately, by the mid-1930s

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both companies were operating in the red. (See “On the Beach,” Fortune, vol. 15, Feb. 1937, pp. 73 ff., especially page 136.) 32. Cohen added the citations to international law, as Pallmé recalled, in the hope that the courts might in time determine that the Port Authority was not controlled by the laws “of either state” (author’s interview with Pallmé, Nov. 4, 1987, p. 5). For the quotations in the text, see Brief for the Port of New York Authority, Oct. 16, 1933, Bush Terminal Co., et al., v. City of New York, et al. (Supreme Court of the State of New York, New York County), pp. 85, 88–90; document 33–1007 in Port Authority library. 33. In that 1819 case, as noted earlier, Chief Justice Marshall had pointed out that “the power to tax involves the power to destroy.” Marshall’s main focus was to deny the right of a state to tax a unit of the national government, but he also commented: “Would the people of any one state trust those of another with a power to control the most insignificant operations of their state government? We know they would not.” The same principles of tax immunity, the Port Authority argued, must apply to agencies created by treaty between states. (Port Authority brief, pp. 91–92; the two quotations from McCulloch v. Maryland, 4 Wheat. 316, are on page 92.) 34. “No State shall . . . pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts . . . ” (Article I, section 10). 35. “Clearer” language is found in the bridge-and-tunnel legislation: “The Port Authority shall be regarded as performing a governmental function . . . and shall be required to pay no taxes or assessments upon any of the property acquired by it for the construction, operation and maintenance of such bridges” (Laws of New Jersey, 1925, Chapter 37, Section 7, referring to the first two Staten Island Bridges; and several other acts, 1925–1931; emphasis added). In contrast, the 1931 statutes only state that the Authority shall “pay a fair and reasonable sum or sums annually . . . not in excess of the sum last paid in taxes upon such property,” so that local governments “may not suffer undue loss of taxes. . . .” (Laws of N.J., 1931, ch. 69; Laws of N.Y., 1931, ch. 553.) The Cohen-Tobin argument quoted in the text is from the Port Authority’s brief, pp. 107–108. 36. The court opinion concluded that “the very existence of the Port Authority would be seriously jeopardized if the states or their municipalities could lawfully tax” the property of the bi-state agency (p. 158); it endorsed the Port Authority’s interpretation of legislative intent, based on the 1931 “in lieu” laws (p. 159); and it viewed the Port agency as engaged in a “most important governmental function,” with the effort to obtain revenue on the upper floors of the terminal as a “necessary and appropriate” step in carrying out the plan (pp. 160, 153–154). (Bush Terminal Co. et al. v. City of New York et al., Supreme Court, Special Term, New York County, 152 Misc. 144 [June 20, 1934], opinion by Judge Frankenthaler.) The Port Authority’s staff assessment is in a Law Department memorandum, “Abstract of Decision of Judge Frankenthaler . . . ,” June 21, 1934, p. 2. For the argument of the private interests, see Bush Terminal Company, et al., Hearing, Dec. 18, 1933, pp. 112, 120–123 (bound volume, Port Authority law library). 37. The letter, dated October 5, 1933, is included in Port of New York Authority, “Brief submitted to General Counsel for Commissioner of Internal Revenue dealing with immunity of the Port of New York Authority, its property, bonds, revenue, and the salaries of

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its officers and employees from federal taxation,” Jan. 15, 1934, pp. 2–3; on file at Port Authority library (34–1012). 38. The 1894 revenue act imposed a tax on personal income derived from municipal bonds, real estate, and personal property. There were two hearings in the case, and two Supreme Court decisions in 1895; the second opinion, with its wide reach, is Pollock v. Farmers’ Loan and Trust Company, 158 U.S. 601. According to Article 1, section 9 of the U. S. Constitution, the national government was barred from levying a “direct tax” on citizens, unless the tax was levied proportionate to population, and in Pollock the Court held (5–4) that the income taxes in the 1894 act were “direct taxes,” thereby rendering them unconstitutional. (For a detailed discussion of the Pollock cases in political as well as legal terms, see Sidney Ratner, American Taxation [New York: Norton, 1942], chapter 10. Ratner provides a useful array of sources; he does, however, evince a pronounced bias against the majority opinions.) 39. Having reviewed the historical evidence, I do not believe it clearly supports either side; both interpretations are reasonable. For detailed evidence in support of the view that the 16th Amendment permits the national government to tax state and local bondholders and employees, see U.S. Dept. of Justice, “Taxation of Government Bondholders and Employees—the Immunity Rule and the Sixteenth Amendment,” June 24, 1938. The opposite position, focused on bondholders’ income, is thoroughly presented in Government Finance Officers Association, South Carolina v. Baker (brief, before the U.S. Supreme Court, October Term, 1986). The Supreme Court opinion in this recent case (485 U.S. 505, 1988), essentially endorses the right of the national government to levy a tax on income from state and local bonds; but the dissent by Justice O’Connor, combined with the reservations expressed in concurring opinions by Justices Stevens, Scalia, and Rehnquist, suggest that the case does not offer clear guidance on how the present Court would respond if Congress were actually to levy such a tax. 40. An effort to add a provision to tax state and local bonds was initiated by Congressman J. Hampton Moore (R-Philadelphia), but it failed because the Democrats, the majority party, “wished to steer clear of judicial controversy and state resentment of federal encroachment on their fiscal powers” (Ratner, 1942, p. 328). 41. A leading opponent of the effort to tax municipal bonds was Mayor John Hylan of New York City, who wrote to the mayors of large cities across the nation, urging that they protest the proposal, which would inflict “a great and irreparable injury on the credit of the municipalities.” New York Times, Sept. 11, 1918. McAdoo’s position is described in the New York Times, Sept. 22, 1918; the article includes an extensive analysis of the tax exemption issue, coupled with a tilt in favor of continued exemption for municipals. 42. These efforts are described in Harley L. Lutz, Public Finance (New York: Appleton, 1930), pp. 581–584, and in Mark H. Leff, “The New Deal and Taxation, 1933–1939” (doctoral dissertation, University of Chicago, 1978), p. 555. The quotations in the text are taken from Leff’s analysis. Support for eliminating tax-exempt bonds in the 1920s came also from those, like McAdoo, who believed that such bonds allowed wealthier individuals to avoid their fair share of the tax burden.

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43. Hughes’ opinion, dated Nov. 10, 1925, is printed in the Port Authority, Annual Report for 1925, pp. 46–57. See also Bard, 1942, p. 246, 275–76, and Cohen, 1946, pp. 317–18. In 1925 Cohen and his law partner published an insightful analysis of the general tax-immunity problem; see Julius Henry Cohen and Kenneth Dayton, “Federal Taxation of State Activities and State Taxation of Federal Activities,” 34 Yale Law Journal 807 (June 1925). 44. The leading case on engineers under contract was Metcalf and Eddy v. Mitchell, 269 U.S. 524 (1926), in which the Supreme Court had unanimously upheld the right of Internal Revenue to collect federal income taxes on the fees paid to engineers working under contract for government agencies. Only “officers and employees” of public agencies, not independent contractors, were entitled to tax exemption. 45. See Leon S. Moisseiff v. Commissioner of Internal Revenue, 21 B.T.A. 515 (Dec. 2, 1930); Ralph Modjeski v. Commissioner of Internal Revenue, 28 B.T.A. 1051 (Aug. 11, 1933). The characterization of Moisseiff as a “guinea pig” to test the reach of the federal income tax is Pallmé’s (letter to the author, Oct. 15, 1989). The evidence that Moisseiff was a Port Authority employee—not an independent contractor—included the requirements that he be present on the job during the hours 9–5 weekdays and 9-noon Saturdays, that he submit a monthly time report showing the number of hours worked on each project, and that he must “perform such tasks as might from time to time be assigned to him” by the chief engineer (Moisseiff, pp. 520, 521, 531–32). 46. See Port of New York Authority, “Brief . . . ,” Jan. 15, 1934, p. 4. 47. Port Authority, “Brief . . . ,” p. 119. In emphasizing that the burden of a tax on governmental activities should be the basis for accepting or rejecting immunity, the Port Authority brief was far from a full-scale defense of tax immunity. Indeed, the brief rejected the Court majority reasoning in the important 1931 Indian Motocycle case, which had (by a vote of 7–2) blocked the federal government from collecting excise taxes on motorcycles sold to a town for its police force; in effect, the Authority’s argument endorsed the position that the federal levy was Constitutional, since there was no evidence the police force would have been significantly burdened by paying the tax. In that case, Justice Stone had also rejected the majority reasoning, suggesting (in dissent) that the “burden” criterion should be used; but he had only been able to persuade one Justice, Brandeis, to join him (Indian Motocycle, pp. 580–583). The 1934 Port Authority brief built upon Stone’s dissent and stated the position forcefully: “We believe . . . that the sole question presented is whether the attempted tax imposes a burden on the performance” of a state’s functions (p.121; emphasis added). In its vigorous criticisms of the Court’s attempts to use the essential/business distinction to decide on tax immunity, the Authority brief drew on the earlier analysis by Cohen and Dayton (34 Yale Law Journal 807, 1925). During the next decade, the Supreme Court would continue to flounder in trying to use or avoid that distinction; see Alpheus Thomas Mason, Harlan Fiske Stone (New York: Viking, 1956), pp. 503–511, 769–771. 48. The quotations are in the Port Authority’s brief, Jan. 1934, pp. 73–74, 174–179. 49. Port Authority, “Abstract of Decision of Judge Frankenthaler . . . ,” June 1934, pp. 3, 6.

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50. Pallmé had gone to see Goldstein and learned that, discouraged about the anti-Jewish attitude among senior lawyers, Sidney was planning to change his name to Gadsen and join a small firm. When Goldstein was offered the Port Authority position, Tobin and Pallmé urged him not to change his name, since they wanted to convey the message widely that recruits would not face religious discrimination at the agency. “You have to keep your name ‘Goldstein,’” Pallmé insisted. “Hurray!” responded Sidney. (Pallmé interview, October 21, 1987.) Compare the advice offered, probably in the early 1930s, to the young Leonard Bernstein: If he would change his name to “Leonard J. Burns,” a famous conductor suggested, he would be more readily accepted in the world of music. (Recollections of LB as reported in “Leonard Bernstein: The Gift of Music,” PBS, Dec. 28, 1993.) Information on Tobin’s activities, described in this paragraph and below, comes from discussions with and letters from his daughter Stacy Tobin Carmichael, his son Austin Tobin Jr., his brother William Tobin, and Janet Tobin, widow of his brother Clarence; also from interviews with colleagues in the Law Department (William Pallmé, Mortimer Edelstein, Sidney Goldstein, and Daniel Goldberg), two staff members who worked in the planning office in the 1930s (Roger Gilman and Nathan Cherniack), Margaret Cullman (whose husband Howard served as a Port Authority commissioner during these years), and two members of the secretarial staff in that period (Rose Lewin Hershdorfer and Edna Goelz Falconer), as well as agency reports and other documents as cited in this section. 51. For the quotations above, see author’s interviews 85 (November 1983), 102 (December 1983), 150, p. 13 (March 1984). 52. The three were Philip Gerhardt, a staff member who had a major role in designing the Inland Terminal so that it would achieve operating efficiency, and the Authority’s two assistant general managers, John Mulcahy and Billings Wilson. The case would be known as Helvering, Commissioner of Internal Revenue v. Gerhardt. 53. In the 1930s, “the lawyer who did the real estate work in any firm was definitely at the bottom of the ladder,” recalls colleague Mortimer Edelstein (author’s interview, November 1987). The text quotation is from Edelstein, author’s interview, April 1984. 54. With his many years of experience in the court system, Austin’s father Clarence had a good eye for a well-argued brief. When he reviewed the materials submitted in the Gerhardt case, he commented to his son: “Your brief is good, but that Epstein can really write a brief!” Henry Epstein was the Solicitor General for New York State, and his brief had been largely prepared by Tobin and Goldberg. (Interviews 42 and 51.) In recruiting Goldberg, Tobin and the Port Authority again benefited from the apparent bias in the private market. In the graduating class of 1935 at Columbia Law School, as Goldberg recalled, ten members of the Law Review were Jewish, and not one was offered a position with a law firm. Tobin was also hoping to hire a New Jersey resident, to maintain a “bi-state balance,” and Goldberg was from that state. (Goldberg, author’s interview, December 1983.) One temporary disadvantage the new recruit brought was his youthfulness: with a B.A. at 16, a Master’s in finance at 17, and a law degree at 20, he would not be eligible to take the bar examination and practice law until 1936, when he turned 21. 55. The initial decision was Gerhardt v. Commissioner and related cases, 34 B.T.A. 1229 (1936); the Court of Appeals acted in Commissioner of Internal Revenue v. Gerhardt

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(299 F.2d. 999), decided in November 1937. The appeals judges seemed to find the guidance offered by earlier Supreme Court decisions compelling and issued no opinion, simply listing recent decisions that supported tax exemption. These included People ex rel. Rogers v. Graves (299 U.S. 401), decided in January 1937, in which the Supreme Court blocked the State of New York from taxing the salary of an official of a federal agency (the Panama Railway Company), and Brush v. Commissioner (300 U.S. 352), decided in March 1937, in which the Court prevented Treasury from taxing the salary of an official of the Bureau of Water Supply for New York City. Those decisions had followed the line of reasoning protecting state and local agencies from federal tax burdens that had been set forth in Indian Motocycle Co. v. United States (1931) and earlier cases. In its 1938 appeal to the Supreme Court, the Administration cited the inland terminal building and the revenue-producing bridges and tunnels as evidence of the Port Authority’s proprietary nature; the agency was described as “a gigantic enterprise earning millions of dollars of annual revenues.” The brief also argued that the Port Authority differed from state agencies because it had been created under a compact approved by Congress and because it operated in interstate commerce, where federal policy was controlling; in view of this intertwining of its activities with the national government, it did not warrant protection from federal taxing power. (See Brief, filed March 25, 1938; quotation at 23, and see 25–28, 33–37, 47–65; available in Port Authority law library. See also New York Times, March 26, April 26, 1938.) 56. The case came to Stone in this way: After oral argument in Gerhardt on April 25, 1938, the justices met to review the case and found there was a plurality and perhaps a majority in favor of permitting federal taxation of Port Authority salaries. (Cardozo was ill, and Reed had disqualified himself; Chief Justice Hughes was apparently not present; and the remaining justices seemed likely to split 4–2.) Generally, the Chief Justice would assign the opinion for drafting, if he were in the majority. With Hughes absent, the senior justice on hand would assign the case; but that was McReynolds, who was in dissent. The next senior justice was Brandeis, who had joined in Stone’s earlier effort to narrow the scope of tax immunity (dissenting in Indian Motocycle, 1931; see discussion earlier in this chapter). Brandeis gave the assignment to Stone. (On these developments and the Court’s difficulties with the tax immunity issue during the 1920s and 1930s, see Mason, 1956, pp. 243–245, 503–511.) 57. As he commented to Felix Frankfurter, in criticizing Hughes’ opinion in another tax immunity case (James v. Dravo, 1937), the approach of public agencies and courts seemed to lead to “such a constant increase of immunities of the one government as to break down the taxing power of the other.” (Stone to Frankfurter, letter dated Dec. 8, 1937; quoted in Mason, 1956, p. 504.) 58. See Helvering, Commissioner of Internal Revenue v. Gerhardt (304 U.S. 405), decided 5–4 on May 23, 1938, and Graves v. ex rel. O’Keefe (306 U.S. 466), decided 7–2 on March 27, 1939. Graves overruled Collector v. Day (1871). Stone’s efforts in the Gerhardt case provided a crucial step toward the definitive result in 1939. Finding that he could not, in 1938, gather a clear majority of the Court in favor of overruling Collector v. Day and an array of other cases, Stone wrote an opinion in Gerhardt which ducks and weaves through various Court decisions that seemed to point in

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different directions, so that he was able to avoid overruling any of them—perhaps in this way holding the support of their champions. As to Indian Motocycle (1931), for example, with its 7–2 majority favoring tax immunity, Stone concludes that its reasoning “is not controlling here,” for “taxation of the sale to a state . . . is not now involved” and “whether the actual effect upon the performance of the state function differed from that of the present tax we do not now inquire.” From his review of the hodge-podge, Stone was able to conclude that while previous court opinions may not “present a completely logical pattern,” they “definitely establish” the two guiding principles—essential (vs. non-essential), and substantial burden (vs. no such burden). However, Stone was only able to persuade three of his colleagues to agree to his Gerhardt opinion. The fifth vote was provided by Hugo Black, whose concurring opinion rejected the essential/nonessential distinction and upheld the income tax simply by using the test that it would not impair the Port Authority’s ability to carry out its duties. (See Helvering v. Gerhardt, 304 U.S. 405; quotations at pp. 419, 421, 424.) As Stone suggested privately, however, a clearer stand against tax avoidance might have lost his fragile majority. After the decision was announced, he wrote to Felix Frankfurter, then at Harvard, “Strictly entre nous, I wrote for a minority of the Court, which I am afraid would have remained a minority if I had written on any other lines.” (letter, June 7, 1938; quoted in Mason, 1956, p. 508). For discussion of Gerhardt and of Stone’s clearer victory in Graves, see Mason, 1956, pp. 505–511, which takes a more generous view of the Gerhardt reasoning than expressed here. Stone’s views of tax immunity during the 1920s and 1930s are also analyzed in Konefsky, 1946, pp. 10–47. 59. One close observer, a strong advocate of reducing tax immunities, thought the Gerhardt decision was “quite astonishing to the legal profession generally.” (Senator Prentiss Brown of Michigan, in discussing the evolution of Court opinions; Hearings before the Committee on Finance, U. S. Senate, on H.R. 3790, Feb. 21, 1939, p. 11.) 60. The garden party is described in Cohen, 1946, p. 320.

Chapter 10 1. Roosevelt called for “a Constitutional Amendment whereby the Federal Government will be permitted to tax the income on subsequently issued State and local securities”; the provision would also permit state and local governments to tax the income of their own residents which was derived from Federal bonds. The proposal was part of an FDR message which noted that “vast personal incomes” tended to engender “social unrest and a deepening sense of unfairness” among the populace. Therefore “very high taxes” should be used to restrict such incomes. (“A Message to the Congress on Tax Revision,” June 19, 1935; from Franklin D. Roosevelt, Public Papers and Addresses, Volume Four: The Court Disapproves, 1935 [New York: Random House, 1938], pp. 270–276.) Congressional attempts in the 1930s to eliminate tax exemption from government bonds are described in Ratner, American Taxation, 1942, ch. 22, and Mark H. Leff, The Limits of Symbolic Reform: The New Deal and Taxation, 1933–39 (New York: Cambridge University Press, 1984), ch. 1–6.

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2. The Supreme Court reversal began with a series of opinions handed down on March 29, 1937, seven weeks after FDR had announced his plan to add additional justices—one for every justice over 70. Since six of the nine members of the Court were over 70, it seemed clear that this stratagem would have allowed Roosevelt to “pack” the court with appointees sympathetic to New Deal programs, ending the pattern of Court opinions which had declared some of his programs unconstitutional. For an insider’s view of the conflict and the outcome, see Robert H. Jackson, The Struggle for Judicial Supremacy (New York: Knopf, 1941), esp. 187–235; see also William E. Leuchtenberg, The Supreme Court Reborn (New York: Oxford University Press, 1995), ch. 5. 3. FDR noted that “heretofore it has been assumed that the Congress was obliged to wait upon that cumbersome and uncertain remedy—a constitutional amendment. . . . Today, however, expressions in recent judicial opinions lead us to hope” that the courts would now find that the Constitution permits taxing municipal bonds. (“A Recommendation to the Congress to Terminate Tax Exemptions for the Future,” April 25, 1938; Roosevelt, Public Papers and Addresses, 1939, pp. 295–299.) 4. See Port Authority, “Brief . . . ,” Jan. 15, 1934, p. 60. 5. Julius Henry Cohen, legal opinion prepared for Frank C. Ferguson, Chairman of the Port of New York Authority, May 31, 1938; reprinted in U. S. Senate, Taxation of Governmental Securities and Salaries, Hearings before the Special Committee on Taxation . . . , Part 2 (Feb. 7–11, 1939), pp. 493–498. During the Senate hearings, Cohen recalled his reactions and those of his colleagues to the Gerhardt decision in this way: “So when we came back, with blood streaming down our faces and our uniforms all torn, we sat down like good lawyers and took the opinion and then we found that the Court had reaffirmed the immunity of our bonds. . . . ” (Ibid., p. 475.) 6. Information on the campaign described below, which extended from 1938 into 1942, draws upon extensive discussions with Goldberg (1983–1985) and with Mortimer Edelstein (1984–1990), documentary materials made available by Goldberg and by the Law Department of the Port Authority, interviews with Sidney Goldstein, William Pallmé, Rose Lewin Hershdorfer, Austin Tobin, Jr., and Stacy Tobin Carmichael, and public hearings and other public records as cited below. The quotations in the text above are from Goldberg, interview, Dec. 1, 1983. 7. See Conference on State Defense, Program and Objectives together with Secretary’s Report on Special Conference of May 31, 1938 [Port of New York Authority, printed late June 1938]; the quotation is on page 10. The issue of back taxes arose because in Gerhardt Stone was “simply” interpreting the U.S. Constitution; therefore, his 1938 opinion did not permit Internal Revenue on its own initiative to forgive back taxes; a Congressional statute would be needed. Because the Court had now reversed the traditional legal understanding of tax liability, however, Congressional action might, in a spirit of fairness, be expected promptly. (No state or local official was liable for federal taxes prior to 1926, because of an exemption clause in the Revenue Act of 1926.) 8. As Tobin then reported to members of the emerging coalition, “prior to June 9th local agents . . . attempted to collect taxes for past years . . . against employees of the Port of Oakland, the California State Board of Harbor Commissioners, the Delaware River Joint Commission, the Triborough Bridge Authority, and The Port of New York Authori-

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ty.” (Conference on State Defense, Program . . . 1938, p. 12). All of those agencies were engaged in port development, an effort Treasury thought would be taxable under Stone’s Gerhardt opinion, which limited tax exemption to activities “essential to the preservation of state governments.” The tax collection effort was suspended on June 9, while Treasury and state representatives sought a compromise. On blocked action in Congress, see Conference on State Defense, Federal Taxation of the States, ca. Dec. 1938, p. 11. 9. Tobin’s formal title was Secretary of the Conference; he and Daniel Goldberg were permitted by the Port agency to devote their energies as needed to the Conference, and at their June 21 meeting the Port Authority’s commissioners also allotted $5,000 to finance mailings and other Conference activities (Port Authority, Board minutes, June 21, 1938). The quotations in the text are from the author’s interview with Goldberg, Dec. 1, 1983. Edelstein joined Tobin’s team after seven years with Leander Shelley, who was Cohen’s top aide and (like Edelstein) a Cornell alumnus. Edelstein found Shelley a very sharp lawyer, but “stiff, uninteresting.” He knew that Tobin was very different—“he had a magic quality; he was joyful”—and so Edelstein readily signed on. (Edelstein notes to the author, April 6, 1984, June 23, 1987.) For the State Defense steering committee, Tobin recruited the state attorneys general from New York, New Jersey, Rhode Island, Connecticut, Delaware, Virginia, North Carolina, Mississippi, Ohio, Kansas, New Mexico, Wyoming, and California. 10. “Even if you think that bond exemption should be ended,” the Conference argued in a mailing to thousands of employees, “you will agree that it must not be done . . . for the sole advantage of the Federal government. If it is to be done, some way must be worked out to assure true reciprocity. . . .” (Conference on State Defense, Federal Taxation of the States, ca. Dec. 1938, p. 4.) At this point, the Conference leaders apparently felt they might have to accept reciprocal taxing of federal and municipal bonds, in order to maintain wide support among public employees—many of whom might share FDR’s view that these bonds provided a tax haven that benefited the very wealthy. 11. See for example, “Tobin Warns Cities of Attack on Bonds,” New York Times, Aug. 16, 1938, reporting his speech before the Municipal Finance Officers’ Association; also, “Assails Tax Plan for Bond Issues,” New York Times, Sept. 23, 1938, reporting Tobin’s address at a meeting of municipal bond dealers; and Henry Epstein, “The States—at the Crossroads,” an address on the tax issue and the broader danger of national centralization, at the annual meeting of the National Association of Attorneys-General, July 25, 1938. Goldberg noted two aspects of this campaign that would bear on Tobin’s later rise: (1) Until this effort, Tobin had no contact with investment bankers; Shelley had been the Port Authority’s liaison with the financial world. Now Tobin met with Eugene Black, David Wood, and other leaders in financing, and “they got to know Tobin and his organizing ability.” (2) When the mailings went out across the country, Tobin “made sure Ramsey and the Commissioners saw copies too.” (Goldberg, interview with the author, Dec. 1, 1983, pp. 7–8.) 12. For a listing of these groups, see Conference on State Defense, Federal Taxation . . . , pp. 13–15. 13. Mortimer Edelstein, one of Tobin’s top assistants throughout the campaign, had never been convinced that the position of the coalition was persuasive. He thought at the

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time that their main argument—that taxing municipal bonds would be a heavy burden on local agencies—“was weak and without foundation.” Nor did Edelstein believe that the public officials he talked with, in his visits across the country, feared that taxing their bonds would “ruin the states and cities.” To Edelstein, “this was a game,” and the Conference on State Defense was “a brilliant piece of promotion.” (Edelstein, notes to the author, April 7, 1984, June 1985; letter to the author, June 23, 1987; notes, October 20 and October 28, 1987.) 14. The impact of the court-packing plan on her father was recalled by Tobin’s daughter Stacy: “He was horrified. What a terrible thing—to ruin the Constitution.” (Interview with the author, Nov. 26, 1984.) Tobin had probably voted for the Democratic ticket, at least in presidential elections, throughout the 1920s, and he had voted for FDR in 1932 and 1936. His wife Geraldine was firmly committed to the perennial Socialist candidate, Norman Thomas. (Austin J. Tobin, Jr., interview with the author, Dec. 9, 1984.) 15. Republicans added 81 seats in the House and eight in the Senate; substantial Democratic majorities still controlled both chambers, however, and “FDR’s personal popularity was still relatively high” (Leff, 1984, p. 265). 16. Port Authority, board of commissioners, Minutes, Dec. 8, 1938 (p. 224). The discovery of Lutz and the 1926 book was recalled by Goldberg (interview with the author, Dec. 1, 1983, p. 6). The book was Charles O. Hardy, Tax-Exempt Securities and the Surtax (New York: Macmillan, 1926). 17. Edelstein thought Lutz was “a hired gun. . . . He was paid to deliver an opinion, and that’s what he did.” The sharp contrast between the argument in Lutz’s 1939 report and his earlier writings provides some support for the argument that Lutz simply followed Tobin’s orders. In his 1930 text, Public Finance, Lutz noted that tax exemption reduced the interest costs when states and cities issued bonds, but he argued that tax-exempt bonds helped to create “a tax-exempt class,” which he viewed as an “undesirable result”; his analysis supported the view that tax exemption should be eliminated. (Lutz, Public Finance, 2d ed., 1930, pp. 580–584.) However, the next edition of this book (Appleton, 1936) omits essentially all critical analysis of tax exemption, which might suggest that Lutz was rethinking his opposition to that policy. 18. Franklin D. Roosevelt, Message to the Congress, Jan. 19, 1939; emphasis added. 19. See U.S. Senate, Special Committee on Taxation of Governmental Securities and Salaries: Hearings . . . pursuant to S. Res. 303, Part 1 (Jan. 18, 1939), esp. pp. 4–9, 13–18, 52–67. (Hereafter, Senate Special Committee, 1939.) 20. In opening the first of the five days, the Committee chairman (Senator Prentiss Brown) commented: “Mr. Tobin, who has consulted me regarding the program, has given me an order of appearances this morning . . . which will be followed.” Tobin’s order was also followed in the next four days. (See Special Senate Committee, 1939: Feb. 7, 8, 9, 10, and 11.) Tobin and Goldberg were on hand, sitting at the table with the witnesses, throughout the hearings. 21. See Senate Special Committee, 1939, Part 2 (Feb. 7), pp. 91–186 (the Lutz report, printed in the Hearings), and pp. 186–202 (his testimony). 22. As LaGuardia outlined his own views, he glanced down at his “written testimony,” turning the pages as he spoke; sitting behind him, Goldberg could see that all the pages were blank. (Hearings, Feb. 7, pp. 244–247.)

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The resolutions came from large cities such as Boston, Philadelphia, Houston, and Los Angeles, and from such smaller centers as Yonkers, Terre Haute, Jackson, Mississippi, and Fresno, California. (Hearings, Feb. 7, pp. 209–244.) 23. Hearings, Feb. 7–8, 1939, pp. 267–274, 284–361; the quotation from Moses is on p. 285. 24. See for example the reference to Lutz’s “exhaustive study and analysis,” by the finance director of Birmingham, Ala. (p. 335); comments on whether most of these bonds are held by wealthy individuals (p. 313); and the testimony by Paul Studenski, a critic of Lutz’s analysis (p. 550). 25. For Cohen’s testimony, see Hearings, Feb. 10–11, 1939, pp. 473–506. Ferguson’s missteps arose as follows: Roosevelt and his allies had argued that tax-free bonds were attractive mainly to the rich, who invested in them to avoid paying their “fair share.” Tobin’s campaign had countered this view in part by arguing that wealthy individuals did not place much of their investment in these funds, and that escaping taxes was not an important motivation for those who purchased these bonds. (See for example the Lutz report, pp. 45–48, 117.) However, when Ferguson was asked by a supporter of the FDR plan, Senator John Miller (D-Arkansas), to explain the role of tax exemption in selling the Port Authority’s early bonds, this exchange followed: “Mr. Ferguson. ‘If it had not been for this sop so to speak to hand to the investor, I do not think we would have been able to sell them at all.’ “Senator Miller. ‘In other words, put another way, the investor was looking for something to avoid taxation?’ “Mr. Ferguson. ‘Yes.’ “Senator Miller. ‘That is true in all tax-exempt bond issues, isn’t it, when you eliminate all of this hurrah about it?’ “Mr. Ferguson. ‘Yes; in one way.’ “Senator Miller. ‘That is what I thought.’ ” (Hearings, Feb. 9, 1939, p. 256.) 26. The testimony of one Treasury tax expert, Henry C. Murphy, elicited the following exchange with Senator Warren Austin (R-VT): “Mr. Murphy. In all of my discussion I shall ignore the problem of intergovernmental relationships and shall assume that all levels of government are interested in the common welfare of all on a consolidated balance sheet basis. . . . “Senator Austin. Excuse me just a moment. . . . When you assume in your discussion to ignore the problem of intergovernmental relationships, aren’t you getting out of joint with the factual conditions? “Mr. Murphy. No; I am merely calling your attention to the facts. . . . I know that different governments stand to lose considerably more than they gain by this proposal, and would be the last one to deny it. . . . I am abstracting from that.” (Hearings, Feb. 15, 1939, pp. 620–621; emphasis added.) 27. See Hearings, Feb. 16, 1939, pp. 684, 694–695. 28. Tobin’s rhetorical flourishes were, however, distinctive. He urged prompt action to safeguard the thousands of state and local employees from the Secretary of the Treasury, who, unless protection from back taxes were provided by Congress, would find it his duty to “assess these people and to take from them whatever little property they may

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have accumulated, and to take from them their homes. . . .” (U. S. Senate, Hearings before the Committee on Finance on H.R. 3790, Public Salary Tax Act of 1939, Feb. 21, 1939, p.25.) 29. Hedrick Smith, The Power Game: How Washington Works (New York: Ballantine Books, 1989), pp. 230–237. 30. On FDR’s strategy, see New York Times, Mar. 29, 1939, and John Morton Blum, From the Morgenthau Diaries: Years of Urgency, 1938–1941 (Boston: Houghton Mifflin, 1965), p. 22. Tobin discussed the work of the Conference on State Defense at a meeting of the Authority’s board in early May and obtained approval for the $3,000 at that time. (Port Authority, Board minutes, May 4, 1939, p. 94.) During the spring, he had also argued the Bush Terminal case on appeal, and the Port Authority’s exemption from local property taxes was upheld by the appellate court. When the state Court of Appeals affirmed the lower court findings in 1940, the case was finally laid to rest. (See 256 N.Y. Appellate Division 978 [1st dept., 1939]; 282 N.Y. Court of Appeals 306 [1940]). 31. The discussion below draws mainly on the recollections of Goldberg (interview, Dec. 1, 1983) and Edelstein (interviews, April 6 and June 25, 1984). 32. These included Frank Buck (D-CA), John McCormack (D-MA), and Thomas Cullen and Christopher Sullivan, both Democrats from New York. 33. Compare the “special inspiration” with which Woodrow Wilson could infuse his personal relationships; John Milton Cooper, Jr., The Warrior and the Priest (Cambridge: Harvard University Press, 1983), p. 94. 34. See U.S. House of Representatives, Tax-Exempt Securities, Hearings before the Committee on Ways and Means, June 28, 29, 30 and July 1, 5, and 11, 1939. Earl Warren’s telegram, addressed to committee member Frank Buck (D-CA), is on p. 106. 35. The Republican position is quoted in U. S. Dept. of Justice, “Taxation of Government Bondholders,” memorandum prepared for the Special Committee, March 28, 1940, p. 5. The strong tilt in editorials against these bonds was emphasized during the floor debate by Senator Prentiss Brown, who favored the FDR plan, to demonstrate the widespread support for ending tax exemption. Opponents, who were on the floor at the time, did not disagree with his figures, although they noted in response that 45 of 48 attorneys general opposed the plan. (See Congressional Record, Sept. 19, 1940, pp. 18614–15.) The Gallup poll results are on p. 18614. 36. Brown introduced his bill on Sept. 12 (Congressional Record, p. 18199). The comments quoted in the text are on pp. 18471 and 18615 of the Record. The vote in the Special Committee was 4–2 in favor of ending tax exemption of future issues, but only three of the four endorsed action by Congressional legislation, with the fourth expressing “no opinion” on whether a simple statute or a Constitutional Amendment was needed. On Brown’s proposed legislation, then, the vote was 3–2, with one abstention. See U.S. Senate, Special Committee on Taxation, Report: Taxation of Governmental Securities and Salaries, Sept. 18, 1940, p. 16. The Report includes a 16-page majority report, a 43-page statement of “Minority Views” (presenting the dissent of Warren Austin and Edward Burke, and largely drafted by Tobin and Goldberg), and a 12-page response by Senator Brown to the Austin-Burke dissent.

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37. Congressional Record, Sept. 18, 1940, pp. 18556–57. Senator Brown did not clarify his response, as Senator Bailey immediately turned to a discussion of detailed calculations made by Professor Lutz. 38. Port Authority, Minutes of the Board of Commissioners, Sept. 26, 1940, pp. 119–122. At the Board meeting, General Manager John Ramsey commented that the efforts of the Conference on State Defense “could not have been carried on nor have been successful but for the efforts of Assistant General Counsel Tobin and his aides, especially Messrs. Goldberg and Edelstein” (Minutes, p. 138). As to the Senate vote, when announced and paired votes were included the tally was 35 Senators in favor and 56 opposed to the FDR bill. (See Congressional Record, Sept. 19, 1940, p. 18621.) The House Ways and Means Committee, which had completed its hearings in July 1939, failed to issue a report during 1939 or in 1940. 39. The bill to end tax exemption on all future U. S. bonds was introduced in the House on Jan. 24, 1941, reported out by Ways and Means on February 3 and passed by the House on the 10th. A slightly different draft was endorsed by the Senate Finance Committee on Feb. 13 and by the full Senate on the 14th; three days later the House approved the Senate version, and on February 20 the bill was on Roosevelt’s desk and he signed it. The swift action on this bill, which encountered no organized opposition, was a striking contrast to the history of Prentiss Brown’s bill, which covered both federal and municipal bonds. As the legislation on U.S. securities moved forward, Treasury officials urged that Congress match it with action on municipal bonds; see for example New York Times, Jan. 30, Feb. 22, 1941. Tobin and Epstein orchestrated the counter-attack by the Conference on State Defense. In late February, for example, after listening to a Treasury official plead his case at a meeting of the U. S. Conference of Mayors, the assembled officials endorsed a resolution denouncing the Administration plan as a “form of political cannibalism”— evoking the image of a hungry federal government gobbling up those tasty morsels, the cities and states. (New York Times, Feb. 22, 1941; see also Jan. 6, 19, 1941.) 40. As FDR had said in opening his 1938 campaign against tax-exempt bonds, the 16th Amendment “expressly authorized the Congress ‘to lay and collect taxes on incomes, from whatever source derived.’ That is plain language. Fairly construed, this language would seem to authorize taxation of income derived from state and municipal, as well as federal bonds.” (Roosevelt, April 25, 1938.) 41. As the Administration indicated in its announcement, this “test case” against “public corporations like the Port of New York Authority” was “intended ultimately to prove in the courts that the federal Government has the right under the Constitution to tax the income from State and municipal securities” (U.S. Treasury Department, press service No. 24–3, March 14, 1941). The vulnerability of the Port Authority, which was described as a huge, business-like enterprise, is most fully captured in the 1944 Administration brief in the Shamberg case, especially pp. 21–23. Goldberg felt that Treasury officials had “bitterly resented” the Congressional defeat they had suffered at the hands of Tobin and his coalition, and that this animus motivated the 1941 suit (interview with the author, Dec. 1, 1983). When it sought Congressional action, the Administration insisted that it wished to tax only future bond issues. However, the decision to use a judicial strategy required that it

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move against outstanding issues. This shift had some real advantages to Treasury; if the courts upheld the strategy, the class of wealthy holders of exempt bonds would be wiped out at once, rather than over 20–30 years (as taxation limited to future bonds would entail). Also, Treasury tax receipts would increase sharply in the first years, rather than growing slowly over two or more decades. 42. Shamberg had been a commissioner of the Port Authority since 1930, and he had purchased a large number of its bonds, relying on the 1925 opinion of Charles Evans Hughes and on Cohen’s assurances that they would not be subject to federal taxes. (See Cohen, They Builded Better Than They Knew, 1946, p. 266.) Internal Revenue calculated Shamberg’s tax liability as $1580 for 1937 and $913 for 1938. (Dept. of Justice brief in Shamberg, 1944, p. 13.) 43. Austin J. Tobin, “Proof of the Pudding” (issued by the Conference on State Defense, about April 1, 1941). The net loss of $1.6 million was obtained by taking the direct cost of removing tax exemption ($8.5 million) and subtracting the maximum possible increase in taxes which Treasury would obtain from those who purchased these bonds ($6.9 million). A few weeks later, examining borrowing costs through early May, Tobin estimated that the federal government was paying 25–30 percent more in borrowing costs. (New York Times, May 16, 1941.) 44. See New York Times, March 23, May 16, Oct. 14, Dec. 5, 1941. For the speech to the bankers, see Austin J. Tobin, “Taxing Municipals by Federal Statute: The Real Issue,” Dec. 4, 1941, 25 pp. (author’s copy). 45. Tobin, Dec. 4, 1941, pp. 1, 3–4. 46. Tobin, Dec. 4, 1941, p. 21. His reference to the early FDR was a 1930 address by Governor Roosevelt: “We are safe from the danger [of oligarchy] just so long as home rule in the States is scrupulously preserved and fought for whenever it seems in danger” (p. 5). 47. One letter singled out several small towns in Tennessee, Oklahoma, and Florida, and “numerous little school districts in Missouri” which might not be able to sell bonds at all if they were taxable. (S.C. Davis, St. Louis Union Trust Company, letter to Dudley C. Smith, Investment Bankers Association of America, Jan. 12, 1942.) On the other hand, a Buffalo banker agreed that the Administration plan would undermine home rule, but he concluded: “I do not feel that the argument that removing tax exemption will destroy the ability of municipal units to finance themselves can be well sustained by either fact or theory.” And a leading Ohio firm came to the conclusion that even small towns would be able to sell taxable bonds; the possibility that any cities would be shut out of the market struck the writer as “somewhat remote.” (H. Browning, Marine Trust Company of Buffalo, letter to Dudley Smith, Investment Bankers’ Association of America, Dec. 22, 1941; J. D. Magee, Braun Bosworth & Co, letter to Dudley Smith, Jan. 7, 1942.) 48. Tobin had located an Alabama state-court opinion, and he then sketched out its relevance to Shamberg as follows: “We must be sure to include in our briefs in the Shamberg case, the secondary line of statutory defense, that . . . no intention should be imputed to Congress to attempt the taxation of a state agency, unless there is an express and positive enactment of its intention so to tax. This doctrine might be particularly appealing to Stone. . . . We would argue that under our federated system, the enactments of neither the legislative bodies of the States or of the Federal Government should ever be held to

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‘affect the other, or any department of the other, unless the act expressly does so,’ that it ‘should never be done by implication.’ “We have heretofore used the collateral argument, c.f. particularly the Bush Terminal case, among many others, that state legislation did not apply to the Port Authority. The argument suggested above, however, that under our federated system a similar construction must be given to federal statutes in their applicability to the states, would seem to be a new argument in the law of intergovernmental immunities as they apply to the interest on the bonds of political subdivisions under the present Internal Revenue Acts.” (A. J. Tobin, memorandum to Mr. Goldberg, Nov. 5, 1941; author’s copy.) 49. See Blum, From the Morgenthau Diaries, vol. 2, 1965, p. 317, and vol. 3, 1967, pp. 34–35; New York Times, Jan. 8, 25, 1942. The quotations are from Morgenthau’s Jan. 24 speech; see Blum, 1967, p. 35. 50. On the attacks levied in early 1942 against the FDR scheme, see the New York Times, Jan. 8, 10, 13, 23, 25, 1942; on House and Senate action, see articles in the Times, May 16, July 17, 28, Oct. 2, 9, 1942. For the defeat of Roosevelt’s judicial efforts, see Commissioner of Internal Revenue v. Shamberg’s Estate,144 F. 2d 998 (2d Cir., 1944), certiorari denied January 2, 1945 by the Supreme Court (323 U.S.792). The courts did not, however, rule on whether the 16th Amendment or other clauses of the U.S. Constitution barred the federal government from taxing the Port Authority’s bonds. The courts focused instead on the fact that Congress had regularly, in its Revenue Acts, exempted securities issued by “a State or a political subdivision thereof”; and they concluded that the Port Authority was exempted under that provision. (Treasury had argued that the agency was a “proprietary instrumentality,” not a “political subdivision.”) In the next twenty years, Treasury made occasional efforts to obtain Congressional legislation ending tax exemption for agencies like the Port Authority, or for municipal bonds generally. These attempts were largely rebuffed until the 1980s. See the summary in the final section of this chapter. 51. Bard, 1942, pp. 266, 327. 52. Interview 19, Jan. 6, 1981. Edelstein recalled that by 1941 Ramsey exerted little leadership. “No one was ever fired” and Ramsey seemed content to let the agency drift. He had begun to absent himself on Fridays, so that he could take golf lessons. (Edelstein, April 30, June 21, 1984.) 53. Bureau of Commerce, Development and Operations Department, Port of New York Authority, The Port Plan, 1921–1940: A Recanvass of the Bi-State Program (July 1940), p. 14. 54. New York Times, July 18, 1940. It seems evident that LaGuardia’s concerns, expressed in June and July, were important in adding that project to the Authority’s set of tasks. A bus station had not been included among the terminal projects which Hedden’s staff explored in the first half of 1940. (See Port Authority, Bureau of Commerce, The Port Plan, July 1940.) 55. Report of the New Jersey Joint Legislative Committee, Dec. 22, 1940, pp. 32–33. In June, the Port agency had submitted a report to the committee, in which it argued against reducing its tolls; it also described the tradeoffs between reducing the debt and adding new facilities, but with no expressed enthusiasm for adding to its responsibilities. It seems clear that the committee favored a more aggressive stance than did Ferguson and his al-

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lies on the board. (See Port of New York Authority, “Report Submitted to the New Jersey Joint Legislative Committee . . . ,” June 1940, esp. pp. 15, 40–41.) 56. “We’ve had dull reports; do something different.” (Ramsey’s comment, as recalled by Edelstein, June 21, 1984.) 57. Faithful to the past, the report argued that the expanding European war gave “added urgency to . . . the proposed Cross Bay Railroad Freight Tunnel,” which would provide a “vital rail link” (Port of New York Authority, The Port of New York, Annual Report for 1940, March 1941, p. 83). 58. See Development and Operations Department, Port of New York Authority, “Recanvass of the Comprehensive Plan,” July 1, 1941 (once confidential; now PA library 41–1013), pp. 9, 10, 18; emphasis added. Pallmé recalled Hedden as someone with a “restless desire to get things done” (author’s interview, Nov. 2, 1987). Hedden’s ideas for improvements had been blocked during the 1930s, and it may be that the New Jersey legislative report of December 1940 provided an important stimulus (and political “cover”) for Hedden to craft this more venturesome document. It is also possible that Hedden’s informal conversations with the legislators had helped to shape their December 1940 report. During the 1930s and early 1940s, there was some conflict among staff members and commissioners on the issue of whether the Authority should take on direct operating responsibilities—rather than leasing its facilities to private firms. Leasing had been used in the inland freight terminal spaces: the railroads leased much of the lower two floors and controlled the availability of the terminal to truckers and steamship operators. Hedden and his aides thought the results were unsatisfactory and warned their colleagues who favored relying on private contractors: “The drawback [of leasing] is that the Port Authority loses control of the premises. . . . The lessee . . . may promote or emasculate at will the Port Authority’s idea in building the terminal. . . . This would be almost fatal to the public interest in a project such as the proposed union fruit and vegetable terminal. . . . The performance of its duties will be severely limited if a policy of refusing to engage in direct operation is adopted” (p. 18). 59. New York Times, Jan. 11, 1942. Ferguson had served as commissioner since 1924 and as chairman since 1934. Ramsey had been on the staff of the study commission which recommended creation of a port authority (1918–21), and he had been a staff member at the Port Authority since it had been formed in 1921. 60. Interview 42, Dec. 1, 1983, p. 11. The timing of Ramsey’s decision was probably also influenced by New York State retirement laws; he had recently turned 55, and he could now retire with favorable financial arrangements. 61. The information here and below is drawn from interviews in the 1980s and 1990s with Tobin’s legal associates, Daniel Goldberg, Mortimer Edelstein, and Sidney Goldstein, from discussions with Tobin’s children, Austin and Stacy, and from the recollections of Roger Gilman, who described Walter Hedden’s reflections on these developments. All the information is, however, second-hand; none of these individuals was present during the discussions reported below. Biographies of Wilson and others discussed below are included in the appendix to a paper by J. H. Cohen dated Oct. 6, 1927 (PA library 27–1024). 62. “Howard liked new things,” one of Cullman’s associates recalled, “and he loved to bring new things into being” (interview 68, 1985). See also the extensive discussion of his

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distinctive personality and activities in “Profiles: Tobacco, Tunnels, Arsenic, and Old Lace,” New Yorker (Feb. 9 and 16, 1946), and his obituary, “Howard S. Cullman, 80, of Port Authority, Dies,” New York Times, June 30, 1972. In addition to his public posts, Byrne owned an insurance firm and he was active in the Newark Chamber of Commerce. For a review of his interests and activities, see Marvin Maurer, “The Role of the Board of Commissioners of the Port of New York Authority in Policy Formation,” doctoral dissertation, Columbia University, 1966, chapter 3; also author’s interview with his son, Joseph Byrne III, April 19, 1984. 63. The defense-transport committee included representatives of the three states, the United States Army, and two civilian federal agencies. Subcommittees were then created to devise emergency responses to bombings or other aggression which might disrupt food, gasoline, and oil supplies. Hedden was a specialist on food distribution and other logistical matters (he had published a book on these issues), and he became a leader of the MDTC effort. (See Port Authority, Annual Report for 1941, pp. 5–6; also Walter P. Hedden, How Great Cities Are Fed [Lexington, MA: D.C. Heath, 1929], 302 pp.) 64. Cohen’s tendency to ramble was noted by Tobin and Goldberg to others (Rosaleen Skehan, Samuel Moerman) in the early 1940s; see also his autobiography (Cohen, 1946). However, in his final years at the Port Authority and beyond his intellectual acuity still matched his egotism as illustrated by his address, “The Port of New York Authority: The Evolution of the Authority Plan in American Administrative Law” (March 13, 1940; PA library 40–1008); his striking speech, “Government of the People . . . ” (Oct. 15, 1942; PA library 42–1001); and his advice on legal strategies to use in the Shamberg case (Cohen letter to Wilbur LaRoe, Jan. 13, 1944). As to Shelley, Mortimer Edelstein, his assistant for several years, noted that he was “very predictable” and “dull.” Even his meals showed these traits, as Edelstein recalls. Shelley ate “meat, mashed potatoes, and apple pie every day” and always at the same restaurant on 14th Street. (Edelstein notes to the author, April 6, 7, 1984.) Shelley received his law degree from Cornell in 1917, he then served in the Army in France and was an associate in Harold Medina’s law firm in Manhattan, before joining the Port Authority in 1926. 65. As his son recalls, “From the time of Pearl Harbor he was trying to really clean up his work and go into the service.” (Austin J. Tobin, Jr., interview with the author, June 20, 1984.) 66. Eugene Black, then vice president at Chase Manhattan Bank, later recalled that he had been very impressed with Tobin and had initiated steps to offer him a position at the bank, when he was “suddenly” vaulted into the top post at the Authority. (Interview with the author, Jan. 15, 1984.) 67. The Ferguson intervention was described by Cullman to Tobin, some years later, and Tobin related the story to Goldberg. (Goldberg, author’s interview, Jan. 26, 1984, p. 8.) Ferguson’s offer to step into the staff position may have been motivated in part by another complexity. His current six-year term on the Port Authority board would expire in June 1942, and in 1941–42 New Jersey’s governor, Democrat Charles Edison, was engaged in a battle to remove state officials who were associated with Frank Hague (Hudson County’s political leader). Advisers to Edison targeted Ferguson as an official “subject to Hague influence,”

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and there was some doubt that Ferguson would be reappointed to the Authority board. Edison finally sent the reappointment papers to the state senate at the end of April. (The reference to “Hague influence” is taken from Port Authority commissioner Joseph A. Bower’s letter to U.S. Senator H. Alexander Smith, describing Ferguson’s difficulties and urging Smith to intercede with Edison in support of Ferguson [March 25, 1942; author’s files].) 68. Goldberg recollected that he was out one evening, “and I got a phone call from Austin. My wife Helen answered, and she gave me the message when I returned: ‘Tell Dan I was just appointed General Manager.’ ‘Helen,’ I said, ‘you’ve got it wrong. He must have meant General Counsel.’ ” (Goldberg interview, Dec. 1, 1983, p. 12.) Tobin’s son had taken part in family discussions on his father’s future plans, and the view at home was that Wilson would be named as Ramsey’s successor, with Shelley and Tobin in active contention for the General Counsel post. As he recalled, “I don’t think he ever considered himself in contention for any part of it. . . . It came as a real surprise to him.” (Austin J. Tobin, Jr., interview, June 20, 1984, p. 8.) 69. The references to “retrenchment” and “managerial caution” are quoted from the agency’s press release. The news stories echoed these themes and conveyed the sense that the departure of Ramsey and Cohen was forced by falling revenues; the appointment of new leadership was buried in the final paragraphs. The headlines convey the point: “RATIONING SPURS PORT BOARD CUTS Retirement of J. E. Ramsey as Manager and J. H. Cohen as Counsel Announced PERSONNEL REORGANIZED Decline in Bridge and Tunnel Tolls Due to Gasoline and Tire Curbs Causes Action” (New York Times, June 5, 1942). Cf. New York Herald Tribune, June 5, 1942. The change of title, from General Manager to Executive Director, had no significance for the job. Under New York State law, Ramsey’s pension would be higher if his position were abolished when he departed, so the commissioners eliminated the post and created a new title. (Goldberg interview, Dec. 1, 1983.) 70. Goldberg was in his office nearby and talked with Tobin shortly after Wilson’s visit. (Goldberg interview, Dec. 1, 1983, p. 13.) Tobin’s son, Austin, recalled his father’s views: “He did not like Billings Wilson. It was a personal dislike. . . . [But] Wilson obviously had some damn good administrative ability. He was an able man. My father [wanted] to make Billings a very actively participating, supporting member of the team he built initially.” (Interview, June 20, 1984, p. 7.) 71. By “playful,” I mean a willingness to think about a variety of ideas and strategies of action, outside traditional patterns. Tobin’s colleague Leander Shelley would be at the opposite end of a continuum—fully rational and predictable. James March captures the main elements of the continuum: “Many [individuals] have experienced a powerful overlearning with respect to rationality. They are exceptionally good at maintaining consistent pictures of themselves, or relating action to purposes. They are exceptionally poor at a playful attitude toward their own beliefs, toward the logic of consistency . . .” (James G. March, Decisions and Organizations [New York: Blackwell, 1988], p. 262).

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72. This is not a conjecture that wins much support from Edelstein and other Port Authority officials who were battling the Administration at the time; however, FDR biographer Arthur Schlesinger found the argument “generally reasonable.” (Schlesinger letter to the author, March 9, 1994.) On FDR’s playful style, see James MacGregor Burns, The Lion and the Fox (New York: Harcourt Brace, 1956), pp. 107–8, 188, 382, and Schlesinger, The Coming of the New Deal, 1958, pp. 579–81. Roosevelt’s praise for the Port Authority is from his address at the dedication of the George Washington Bridge, Oct. 24, 1931. 73. Cohen also used the opportunity to attack the “unrestrained play of competition” as “obsolete,” and to urge that American law and policy be altered in order to encourage “enforced monopoly and enforced cooperation in the public interest and for the social good.” Clearly the principles of the Comprehensive Plan and his bitter experience with the recalcitrant railroads were still in the forefront of his mind. (Julius Henry Cohen, “Ice,” Boston University Law Review, 13 (January 1933), 1–21; quotation at 7.) For Brandeis’s observation, see New State Ice Co. v. Liebmann (285 U.S. 262, at 311). Oklahoma’s legislature had concluded that the manufacture of ice for sale could only be assured, especially in rural areas, if it were treated as a public utility, requiring a state license; a permit would be granted to a new applicant only if adding a new ice-maker would not result in “unnecessary duplication of facilities,” and therefore in “high rates and poor service” to those needing ice for dairy refrigeration and other purposes (Brandeis, 282). The Court majority concluded that the statute violated the 14th Amendment and other provisions of the U.S. Constitution: “There are certain essentials of liberty with which the state is not entitled to dispense in the interest of experiments,” argued Justice Sutherland (280); the manufacture and sale of ice was apparently one of them. 74. Tobin, Dec. 4, 1941, p. 21. 75. The victory embraced the entire class of cases which Treasury had thought most vulnerable—securities issued by the Port of New York Authority and other public authorities, which Treasury had argued were “proprietary instrumentalities” and therefore subject to federal taxes under the guidelines of South Carolina (1905). During the years of litigation, Alexander Shamberg had died, and the Port Authority agreed to carry the case through to the Supreme Court, in return for a Treasury commitment to abide by the Court decision and not initiate further cases. In its decision in Shamberg, the Court of Appeals noted that the Revenue Acts excluded the interest on bonds of “a State or political subdivision thereof” in calculating personal income, and determined that the Port Authority was a “political subdivision.” Thus it rejected the view that the Authority should be seen as a business and classified with South Carolina’s liquor stores (which had been taken over by the state in order to reap a profit for the state government). Rather, the Port Authority or any similar agency which undertook “customary governmental activities, such as development of roads, bridges and waterways entered upon with no profit motive,” was a “political subdivision,” whose bonds were protected by the Revenue Acts. See Commissioner of Internal Revenue v. Shamberg’s Estate (144 F.2d 998 [2d Cir., 1944], quotation at 1005); certiorari denied, 323 U.S. 792 (1945); Austin J. Tobin, “The Shamberg Case,” Daily Bond Buyer, Jan. 11, 1945 (on the Port Authority-Treasury agreement to pursue no further cases).

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76. On the 1949–1950 efforts, see Daniel B. Goldberg, memorandum to Mr. Shelley and Mr. Goldstein, March 3, 1949; and Arthur W. Viner, “Those ‘Tax-Free’ Bonds: It’s Time the Economy was Cleansed of Them,” Fortune (April 1950), with responses by Austin Tobin, David M. Wood, and Walter W. Craigie, Daily Bond Buyer, May 2, 3, 4, 1950. In 1971 the National League of Cities, the National Association of Counties, the National Governors Conference, and half a dozen other national groups joined together to defend tax-exempt bonds against the Treasury assault. Goldberg testified on behalf of those groups and the GFOA at Treasury hearings; and Jeffrey Green, then Assistant General Counsel at the Port Authority, worked on the GFOA amicus brief. The GFOA effort included calling state officials across the country, urging them to contact their Congressional representatives in support of continuing tax exemption. (Jeffrey Green, interview with the author, June 1, 1994.) 77. Goldberg helped to write the amicus curiae brief of the National Institute of Municipal Law Officers, which had been part of the national coalition since the 1930s. 78. The Court opinion was explicit: “We thus confirm that subsequent caselaw has overruled the holding in Pollock that state bond interest is immune from a nondiscriminatory federal tax. We see no constitutional reason for treating persons who receive interest on government bonds differently from other types of contracts with the government.” South Carolina v. Baker, 485 U.S. 505 (1988); quotation at 524. The opinion, by Justice Brennan, explicitly adopts the rationale used by the Court in Gerhardt and Graves for taxing salaries, and applies it to income from municipal bonds. The quotations from O’Connor’s dissent are at 531, 532. 79. On the Court’s 1988 opinion: South Carolina and her allies had argued that the registration requirements violated not only the doctrine of intergovernmental tax immunity, but also the principles of federalism, grounded in the Tenth Amendment, which limit Congressional authority to regulate state activities. The Supreme Court rejected that view: “States must find their protection from congressional regulation through the national political process, not through judicially defined spheres of unregulable state activity.” On the political response to the Court’s decision, see the letter from Jeffrey S. Green, general counsel at the Port Authority, to the author, Feb. 18, 1993, summarizing developments since the South Carolina decision; quotations in the text are taken from that letter. See also Anthony Commission on Public Finance, Preserving the Federal-State-Local Partnership: the Role of Tax-Exempt Financing (October 1989); and, on the general tension between national power and state flexibility and experimentation, Judith Resnik, “Rereading ‘The Federal Courts,’” Vanderbilt Law Review, 47 (May 1994), esp. pp. 1049– 1054. For an insightful analysis of the politics of tax-exempt bonds in the past twenty years, see Alberta M. Sbragia, Debt Wish: Entrepreneurial Cities, U.S. Federalism, and Economic Development (University of Pittsburgh Press, 1996), esp. chapters 8 and 9.

Chapter 11 1. Reconstruction in Philosophy (New York: Henry Holt, 1920), pp. 48–49. 2. The Prince (1513), chapter 6; trans. Peter Bondanella and Mark Musa, The Portable Machiavelli (New York: Penguin, 1979).

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3. Selznick’s distinction is useful here: An organization may be defined as a “rational instrument” constructed to carry out defined tasks; its members receive compensation in return for carrying out their duties, but they invest their place of employment with little emotional commitment and are likely to shift to another job opportunity which offers more salary, or other individualized benefits, without regret. An institution, in contrast, captures the emotional loyalty of its members, who—if effectively led—are less likely to “work to the time clock” and are willing to stretch their efforts to achieve missions to which they feel committed. (Philip Selznick, The Moral Commonwealth [Berkeley: University of California Press, 1992], pp. 233–235; and see Selznick, Leadership in Administration, 1957, pp. 17, 27, 149 ff.) 4. In examining these several questions, I will draw upon two important studies which consider some portions of the Port Authority’s work during these years—Herbert Kaufman’s “Gotham in the Air Age,” and Robert Caro’s massive biography of Robert Moses, The Power Broker—and discuss my differences with their interpretations. 5. Joseph Schumpeter, The Theory of Economic Development (Cambridge: Harvard University Press, 1934), pp. 93–94. See chapter 1 for a general discussion of entrepreneurial leadership. 6. Bard, Port of New York Authority, 1942), p. 320; also, Erwin W. Bard, interview by the author, March 1984. Chapter 11 provides an expanded discussion of events described in two earlier essays: J. W. Doig, “To Claim the Seas and the Skies,” in Doig and Hargrove, eds., Leadership and Innovation, 1987, pp. 139–152; and J. W. Doig, “Regional Conflict in the New York Metropolis,” Urban Studies, 27 (April 1990), pp. 206–219. 7. Port Authority Diary, July 1942, pp. 1–2. 8. The earlier activities of Edelstein and Hedden are described in chapter 10. 9. Reprinted in Mortimer S. Edelstein, “The Authority Plan—Tool of Modern Government,” Cornell Law Quarterly, 28 (1943), p. 189. 10. Department of Port Development, “Post-war Program of the Port of New York Authority,” Nov. 17, 1942, 25p. (PA 42–1005). The newer proposals were based on ideas developed in the 1930s by Hedden’s Bureau of Commerce; see chapter 10. 11. Edelstein, 1943, pp. 190–191. The speech was given on December 11, 1942. 12. Port of New York Authority, Annual Report for 1942 (April 1, 1943), pp. i-iv. In persuading the Board to accept his view, Tobin was aided by a study made by a prominent consulting firm. In February 1943, he contracted with Coverdale & Colpitts to evaluate the agency’s operations. Coverdale’s report noted that in the past the Board had taken a “more or less passive attitude with respect to broad-scale port development,” an approach that was “in our opinion . . . far less than adequate to plan the development of the port” for the postwar era. The consultants urged that a skilled group of economists and transportation planners be hired to analyze future opportunities and to collaborate with other agencies on postwar plans for the region. (Coverdale and Colpitts, Report on the Port of New York Authority, April 10, 1943, pp. 55–56; author’s copy.) 13. Austin Tobin and Walter Hedden,” The Port Planning Program,” June 1943, pp. 2, 7; author’s copy. This set of projects follows closely the proposals by Hedden and his staff in 1940–41 and the fall of 1942, as summarized earlier. (The 1943 report was held in the confidential files of the Planning Department until the 1980s; I am indebted to Edward

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S. Olcott, who directed the department in that decade, for locating the document and making it available.) 14. Ibid., pp. 4, 17, 35 and 7–8. The report steered clear of the thought, advanced by Hedden’s staff a few months earlier, that “blighted slum areas” of cities might be used for airports. The earlier report had argued: “Experts believe that air fields 10 to 20 miles away from business centers will not meet the needs of tomorrow’s air transport. For example, the British are at present giving serious consideration to utilizing the bombed center of London as an airplane terminal. . . . ” (Dept. of Port Development, “Post-war Program . . . ,” Nov. 1942, p. 6.) 15. Ibid., pp. 25–26. 16. Ibid., pp. 29–30, 35. The report was also optimistic about the prospects for passenger transit projects that would be economically practical. After describing a New Jersey north-south rail line that might be built along the Hudson River, and joined to tracks under the Hudson into midtown Manhattan, the authors comment: “While the suburban transit project may not be fully self-supporting,” the national government might provide a public-works grant which “would insure economic practicability” (p. 30). 17. It is not possible to know exactly what views Tobin held and how they evolved, as he and his associates laid out the campaign for new programs that would occupy the next several years. Tobin and most of the principals had died before my interviewing began, in the early 1980s. But they left behind thousands of pages of public studies, confidential documents, and private letters that permit us to lay out the expectations and concerns, the obstacles and strategies, the successes and failures with considerable accuracy. Also, it has been possible to compare parts of the written record with the recollections of several staff members and family members who were involved in these developments. 18. Tobin’s concern was expressed to Daniel Goldberg; see author’s interview, May 10, 1984. Former general manager John Ramsey recalled that he had felt pressure from several quarters to oust his long-time press-relations director. “From time to time Julius was insistent he be replaced;” Ramsey noted; Howard Cullman and Walter Hedden shared that view, because of “lack of cooperation and results.” But “I withstood the pressure and kept him in office,” Ramsey concluded, apparently because he was reluctant to sever a long-term employee who was in poor health. (John Ramsey, personal letter to Mortimer Edelstein, Feb. 3, 1944; see also Commissioner’s letter, confidential, Oct. 18, 1943.) The April 1943 report from Coverdale & Colpitts noted that preparation of the agency’s last two annual reports “had been taken away” from Keefe and recommended that all public relations duties be handled elsewhere (pp. 72–73, 92). 19. In an essay published in the New York Times on August 1, 1943, for example, Moses commented that “our bi-state Port of New York Authority has been preoccupied with the building of bridges and tunnels” and he urged it to develop new plans to revitalize commerce in the region. 20. For evidence regarding the views of Tobin, his colleagues, and other observers, see the June 1943 port planning report; Port Authority, Annual Report for 1943 (April 1, 1944), letter of transmittal (7 pp.) and pp. 14–15; Austin Tobin, Weekly Reports to the Commissioners, July 1943-December 1944, passim; and the views of Harland Bartholomew, who with Harry Alexander, William Anderson, and other members of Bartholomew’s planning

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firm studied Newark’s economic and planning needs from 1943 through 1947 (see, e.g., H. Bartholomew, letter to Harry Alexander, Oct. 8, 1945; and Eldridge Lovelace, taped interview [at the request of the author] with H. Bartholomew, April 19, 1984). 21. In the field of airport development, competitive strife had been on public display throughout the 1930s and early 1940s, in the activities and rhetoric of Newark and New York City; see the analysis in Herbert Kaufman, “Gotham in the Air Age,” in Harold Stein, ed., Public Administration and Policy Development (New York: Harcourt, Brace, 1952), pp. 151–162. 22. The Port Authority had long been reluctant to propose new projects, lest it be attacked for seeking to expand its power. “We’re always suspect,” as a senior agency official commented in 1950. (Herbert Kaufman, interview held March 24, 1950.) LaGuardia’s special desire to retain control over New York’s airports was rooted in personal history. LaGuardia had been a pilot in World War I; and as mayor since 1933, he had led the fight to build and expand New York’s airfields (to compete with Newark Airport, which had been constructed earlier). In 1939 the city’s North Beach airfield had been renamed LaGuardia Airport in honor of his efforts; and in 1941 the mayor had initiated action to construct a vastly larger airfield at Idlewild, in the marshlands of southern Queens. Much of LaGuardia’s energy during the final four years of his 12-year tenure as mayor (1933–45) was devoted to airport policies and modernization plans. (Herbert Kaufman, “Gotham in the Air Age,” pp. 158–160; and Kaufman, interview with official #3, Feb. 21, 1950.) 23. The information in this section is based on several detailed, frank letters between members of the Board in 1943–44, interviews in 1984 with three staff members who were involved, Confidential Document B (June 1958), pp. 65 and 73, and newspaper articles cited below. 24. On learning of Edelstein’s appointment, Ferguson reportedly exploded: “I won’t have a red-headed Jew in the front office!” Ferguson’s anti-Semitic tendencies were known to several top officials, although one staff member later recalled that it was “supposedly a tightly kept secret”; all information on this issue was kept “in a locked drawer and eventually destroyed.” (Interview 41, March 1984; interview 74, July 17, 1984; letter to the author, Aug. 13, 1984.) Marion Sanders and her husband had known the Cullmans socially for more than fifteen years, and in the late 1920s she had worked with Howard Cullman and Belle Moskowitz on Al Smith’s gubernatorial campaigns and Robert Wagner’s campaign for the U.S. Senate. In the 1930s she had occasionally been drafted to write speeches for Port Authority officials, and in 1937 John Ramsey had agreed to bring her onto the permanent staff. Roosevelt’s 1931 dedication address at the George Washington Bridge was crafted in her office. (Howard Cullman, letter to Frank Ferguson, Sept. 16, 1943.) For a summary of the port-planning studies approved in the fall of 1943, see Port Authority, Annual Report for 1943 (April 1, 1944), pp. 14–21. 25. Correspondence provides some evidence on these points. In the fall of 1943, one member of the Board wrote to another commissioner: “We are being made a bunch of damned fools. Austin, I think, is damned near ready to quit; Walter Hedden was ready to resign if the Port Planning had not gone through, as the result of the Chairman’s actions.”

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He continued, “We either believe in management or we don’t. I happen to believe in Austin but if he is not the right management he should be removed but it makes no sense to keep on [blocking his proposals].” (Commissioner’s letter, confidential, October 18, 1943, pp. 1, 5; author’s copy.) As the rift continued, Cullman wrote to New Jersey commissioner Joseph Byrne, who chaired the agency’s personnel committee, in protest: “I am not a candidate, in any way, for chairman. I would not accept the nomination and, if elected, I would not serve. Is that definite enough?” (Cullman, letter to Byrne, Dec. 20, 1943.) 26. Tobin’s Weekly Reports provided a steady drumfire of news regarding postwar needs and opportunities. In his August 6, 1943 report, he noted that the Port of London Authority was planning to develop a large airport. During the fall, he described meetings with Newark planners on locations for truck terminals, on rapid transit issues, and on “studies of the need for airport expansion.” Early in 1944, he reported that the national government was thinking about providing funds for airport development, and that the Port Authority staff was meeting in Washington on the possibility of federal funding. The campaign to educate the broader public is illustrated by Walter Hedden’s speech, in East Orange, N.J. on Jan. 19, 1944, on the importance of new regional highways, truck terminals and airport facilities (with a press release distributed the next day); the article by staff member J. W. Wood on the Port Authority’s plans to make the New York area “World’s No. 1 Air Freight Center,” which appeared in the journal Air Transportation in Feb. 1944; and Hedden’s address at a conference in Manhattan on May 3, describing the need to modernize the region’s sea and air terminals. 27. Edelstein’s recollections, recorded in interviews with the author, April 6, June 21, 1984. Shortly after his meeting with Ferguson, Edelstein wrote to John Ramsey, then in Kentucky, describing his mistreatment at Ferguson’s hands. In responding, Ramsey noted that because Edelstein had moved to the front office he was “the target for gossip, intrigue, etc.” and he urged that Edelstein try to ignore the attacks. (Ramsey letter to Edelstein, Feb. 3, 1944; author’s copy.) After leaving Tobin’s staff, Edelstein became a partner at a major New York law firm, Paul, Weiss, Wharton and Garrison. 28. Interview 93, May 1984. Tobin’s distress was caused in part by frustration at finding his staff appointments blocked, but equally important was Tobin’s strong opposition to anti-Semitism. In the mid-1930s, his daughter recalled, visitors to the house one day made anti-Semitic comments; her father at once rose from his chair in outrage and ejected them from the Tobin home. (Stacy Carmichael, interview, Jan. 21, 1984.) Since the early 1930s Tobin’s closest working relationships had been with four lawyers and their secretary, all of whom happened to be Jewish (Sid Goldstein, Dan Goldberg, Mort Edelstein, Rose Lewin); and with Goldstein those contacts had deepened into close friendship. In principle and through his personal experience, then, Tobin found Ferguson’s behavior abhorrent. 29. In some of those stories, Ferguson was cited prominently; and in an October article, his views on regional progress were featured in the headline and the text. Mrs. Jaffe’s recollection is that this story swung the once-hostile executive to her side. So egotism may occasionally surmount prejudice. (See “Does Not Fear Plane as Rival: Ferguson Says Port Value Will Not be Impaired,” The Sun [New York City daily], Oct. 11, 1944.)

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As to the Wagner-Walsh pressure on the Board, see interview 95, May 1984; also, Commissioner’s confidential letter, Nov. 13, 1944, in author’s files. According to one report (int. 95), Commissioner Walsh thumped the table at one Board meeting and exclaimed, “If this girl isn’t hired, I’m going to make this public!” Lee Kreiselman [Jaffe] grew up in Ohio, was a staff assistant in Herbert Hoover’s 1928 presidential campaign, and during the 1930s served as Washington correspondent for the Wichita Beacon and several other newspapers. There she was singled out as “one of the most energetic girls in the [press] gallery.” When the United States entered the war, she joined the Office of War Information, where she devised strategies to educate the public about the use of rationing books. Promoted to the job of Regional Radio Director for the Office of Price Administration in 1943, she found that position unsatisfying and when the Port Authority advertised the post of Director of Public Relations she applied. (Biographical summary, ca. 1980; Lee K. Jaffe, author’s interviews, May 7, August 8, 1984, and Jan. 28, 1987; quotation from Ishbel Ross, Ladies of the Press [New York: Harper & Brothers, 1936], p. 357.) 30. As the Newark News reported, “It is no State House secret that Mr. Edge has been concerned about developments within the Port Authority . . ., the latest being the stalemate over the election of a chairman. . . . This deadlock is to be broken by Mr. Edge. The Governor intends to terminate Mr. Borg’s ad interim appointment next Monday night” (editorial, Jan. 18, 1945). The access of the News to dissension on the Board had been shown earlier, when it reported that Byrne and Walsh would not support Ferguson’s reappointment as chairman (Newark News, Jan. 4, 1945). Edge’s conflict with Borg, his fellow Republican, arose in this way: Edge had been an avid supporter of the Port Authority idea when he was governor in 1917–1919. In 1943 he was elected governor once again, with a pledge to campaign for a new state constitution. His effort was opposed not only by Frank Hague and his Democratic allies, but also by John Borg, publisher of the influential newspaper, the Bergen Record; and the proposed constitution was rejected by the voters in November 1944. As Edge records in his autobiography: “Borg . . . carried the Democratic torch so effectively that Bergen County’s expected heavy plurality melted away. As a consequence, I refused to reappoint Borg as a commissioner of the Port of New York Authority.” (Edge, A Jerseyman’s Journal, 1948, p. 340.) Borg’s own comments, once he found that Edge would drop him from the Port agency, suggest the sharp split between these two Republican leaders: “Edge went overboard on Constitution revision. After his overwhelming defeat . . . a bitter old man issued reprisal threats,” and Borg was then punished. (New York Times, Jan. 18, 1945.) 31. At the decisive Board meeting, on Feb. 8, 1945, Ferguson permitted his antagonism toward Cullman to control his behavior. In the first vote for chairman, Cullman had six votes to three for Ferguson; it was then clear than Ferguson could not win, but Cullman’s votes included only three from New Jersey (with Ferguson voting for himself, Greer joining him, and Lowe not yet voting); a majority (4 of 6) was needed. To block Cullman on the second round, Ferguson then nominated a New York Commissioner, Bayard Pope, who at once declined to run. So Ferguson nominated Eugene Moran of New York, but the nomination was not seconded; a telegram was then read into the record from Moran, who was out of the city, endorsing Cullman. Ferguson then said he was not a candidate

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“and would not serve if elected”; and Cullman was nominated as the sole candidate. Everyone at the meeting voted for him—except Ferguson, who registered a “No” vote and then rushed from the room, muttering expletives against his successor. (Except for the rush from the room, all the proceedings are in the Board Minutes, Feb. 8, 1945.) 32. William H. Riker, The Art of Political Manipulation (New Haven: Yale University Press, 1986), p. ix. 33. Kaufman, “Gotham in the Air Age,” p. 179. The passive Port Authority stance (“in response to”) is its own description; see A Chronology of the Port of New York Authority: 1921–1967, under activities for 1946; the same theme is found in many of the agency’s press releases and reports in the 1940s and 1950s. 34. “The Prayer of the Port Authority,” editorial, Jersey Journal, Nov. 22, 1944. 35. The argument that new projects should be developed in order to ward off pressure for toll reduction was not set down on paper in those explicit terms. However, staff members at the agency understood this linkage, while they also favored new projects as important to the economic development of the bi-state region. [See for example author’s interviews with Roger H. Gilman (staff member of the Port Authority, 1936–1977, in the planning department), 1984 and 1987; and with Lee K. Jaffe (Director of Public Affairs, 1944–1966), 1985 and 1987.] At times the point was made obliquely; opposing pressure to cut its tolls, the agency argued that existing toll rates generated funds needed for new facilities (“to give the tollpayers such improvements as the Lincoln Tunnel”). (Port of New York Authority, “Report Submitted to the New Jersey Joint Legislative Committee . . . ,” June 7, 1940). Upon reading a draft of this chapter, one long-term Port Authority employee protested: “You seem to be looking for a ‘selfish’ or conspiratorial motivation (how to reinvest the surplus to postpone pressure for tolls reduction). Why not a public good motivation like how to meet the transportation and commercial needs of the region?” (Letter 404 to the author, July 30, 1994.) My own view is that these motives are not incompatible. If the Port agency’s staff wished to play an important role in meeting the transport needs of the New York region during the next several decades, it needed to find ways to maintain bridgeand-tunnel tolls, so there would be a surplus to use for long-term investments. The real challenge would be to use the toll dividend wisely—as in constructing modern airports, aiding commuter travel with bus terminals in Manhattan, and advancing the risky cause of containers at Newark and internationally; and to resist the siren song of “balanced development” when that meant inefficient patronage projects, as the Manhattan cruise ship terminal in the 1970s and perhaps the efforts to revive Staten Island and Brooklyn freight piers in the 1980s. 36. Stated policy resisted this kind of explicit balancing: “Any approach that attempted to match facilities, a brick for a brick, in New Jersey and New York, would be the antithesis of the regional development . . . intended by the Treaty.” (Port Authority, Annual Report for 1945, p. v.) But here as elsewhere reality did not always follow rhetoric. 37. See text at note 11 above. 38. The risk-taking side of the Port Authority’s personality remained, however, as suggested in the opening pages of its 1945 annual report: “In many cases of proper Authority financing . . . the project is in its very nature marginal. That is . . . it holds the reasonable

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prospect of sufficient revenues to pay its operating costs and interest charges and to repay its capital investment, but holds no real prospect of profits” (p. vi; emphasis added). 39. The favorable prospects for self-supporting airports and marine terminals are summarized in James C. Buckley, “Port Planning Program—Progress Report,” Aug. 8, 1945, which also describes his Congressional testimony of March 20 and June 12. Tobin’s aide also sketched out ideas that would become part of the rationale for a set of world-trade buildings in the 1960s: “We believe that maintenance of New York’s position as a world trade center may require establishment of a periodic or possibly a permanent sample fair.” Buckley reported that his staff had gathered information abroad on similar projects—which provide a central place for trade specialists to gather information on a nation’s export goods—and was ready to study the feasibility of such an enterprise in the New York area. (Buckley, 1945 report, pp. 3–4.) 40. Guy Savino, Newark News reporter who covered the Port Authority’s activities from the 1930s through the 1960s (author’s interview, May 1, 1984). 41. Among the newspaper reports that appeared in Jaffe’s first fifteen months were these: “New York Presses Atlantic Air Plea: Port Authority Puts Case for City as Transocean Terminal in Hearing before CAB,” New York Times, Oct. 17, 1944; “Future of New York As Port Held Assured,” New York World Telegram, Dec. 21, 1944 (reporting Hedden’s Dec. 20 speech on sea, land and air transport); “Sees New York Leading in Air: Port Authority Economist Predicts Vast Shipments,” Hudson Dispatch, Jan. 23, 1945; “New York City Stakes Its Claim in Postwar Air World,” Daily News, Feb. 26, 1945 (and the ensuing articles in that detailed five-part analysis, which drew heavily on the work of Buckley and his aides); “New York—Air Hub,” editorial, New York Times, Sept. 8, 1945 (commending the Port Authority for “its continuing efforts to help establish New York as a great world air center”). When the Port agency finally offered to take on airport operations, in the summer of 1946, the newspapers could view this as a natural extension of its earlier work; the Newark News, for instance, explained to its readers that the Authority had been “long active in aviation planning” (July 14, 1946). Meanwhile, its prospects as a seaport operator were aided by Governor Thomas E. Dewey’s 1944 request that it take over the dilapidated grain terminal on the Gowanus Canal in Brooklyn and the adjoining Columbia Street pier. Operated by the state, the project had been in the red for years, and some Authority officials saw it as a certain loser. But Tobin’s view was quite different: the Port Authority had never operated a port terminal, and here was an opportunity to gain experience and stamp itself as an actor in that field. Moreover, Tobin’s staff could experiment with ways to increase the flow of grain shipments through the Port of New York. “If this works,” he exclaimed to an associate, “we might be able to build a series of these terminals!” (author’s interview, July 26, 1984). Taking control in May 1944, the Authority aggressively promoted the terminal, turned an operating profit in the first year, and began a program of rehabilitation. By 1945, Tobin and his aides could cite the Port agency as having some, if modest, experience in operating marine facilities. (See Port Authority, Annual Reports for 1943–45, and author’s interview 190.) 42. The Port Authority and the Regional Plan Association had cooperated in advancing

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the cause of the George Washington Bridge in the 1920s and in other regional highway projects in the 1930s. As long-time RPA executive C. McKim Norton commented, only partly in jest, regarding the Authority’s projects: “They were doing God’s work. And anytime they built anything, we took full credit.” (Norton, interview with the author, Feb. 18, 1985.) On the airport studies, see the RPA’s newsletters for June 26, Nov. 1, 1944 and Oct. 11, 1945, et seq., and Regional Plan Bulletin No. 68 (Nov. 1946). Cooperation with Washington was aided by the fact that the federal official charged with developing regional airport plans in 1944 was Commerce Department executive William Burden, a classmate of Norton at Harvard in the 1920s. (Norton, interview, Feb. 18, 1985.) Buckley’s discussions with the CAB and airlines are summarized in his Aug. 8, 1945 report cited above. In that report, Buckley also described discussions with the American Geographic Society to develop an azimuth map which, by showing Great Circle routes, would demonstrate New York’s proximity to major international cities and thus aid the region in the campaign for airline service. 43. On Bartholomew’s background and interests, see letters to the author from Eldridge Lovelace, a member of his firm, April 25, May 8, June 1, 1984, and Lovelace, “Harland Bartholomew: His Contributions to American Urban Planning” (Urbana: University of Illinois, Dept. of Urban and Regional Planning), 1993. See also a brief obituary, “Harland Bartholomew, 100, Dean of City Planners,” New York Times, Dec. 7, 1989. Newark’s weakened economic condition in this period is described in Paul A. Stellhorn, “Depression and Decline,” doctoral dissertation, Rutgers University, 1982. 44. Information in this and the following paragraphs is drawn from Tobin’s Weekly Report, Nov. 12, 1943; Harland Bartholomew and Associates, “A Preliminary Report on Seaport and Airport Development for Newark, New Jersey,” Oct. 1945; Eldridge Lovelace, interviews in St. Louis with Harland Bartholomew, April 19, May 31, 1984 (at the request of the author, who provided the questions to be explored); the author’s interviews with Eldridge Lovelace, April 6, 30, 1984, and with William Anderson, April 30, July 3, 1984. 45. The quotations in these paragraphs are from Lovelace, interview with Bartholomew, May 31, 1984. Some information in the text is based on Lovelace, interview with Bartholomew, April 19, 1984. (It is worth noting that Lovelace’s later biography of Bartholomew refers briefly to the Newark collaboration, and conveys the sense that the Port agency was essentially passive, with the initiative in the hands of Bartholomew and the city’s planners. [Lovelace, 1993, pp. 71–73] Lovelace relies there only on the Port Authority’s public position, as stated in its Annual Report for 1946, p. 3.) 46. From Newark’s perspective this had meant destructive competition, especially in the air transport field, where Mayor LaGuardia’s energetic efforts had stripped Newark in the late 1930s of its earlier preeminence as an air center. See Kaufman, “Gotham in the Air Age,” pp. 153 ff. 47. The quotations are from the October 1945 draft report, pp. 2–4, 96. The report also noted that “there is precedence” for successful Port Authority operation of sea and airport facilities, for it had taken over the Brooklyn grain terminal a year earlier and transformed it “from a liability into an asset” (p. 4). 48. Riker, 1986, p. ix.

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49. “Brady Attacks Port Proposal,” Newark News, April 30, 1945. Newark’s governing body, the City Commission, included a mayor plus four commissioners; Brady’s view was shared by at least two other commissioners. 50. The quotations are from Tobin’s letter to the Central Planning Board of Newark, Dec. 21, 1945 (printed in full in Tobin’s Weekly Report, Dec. 22, 1945 and excerpted in Newark News, Dec. 21, 1945). The Port Authority’s vice chairman, Joseph Byrne, had left the Newark City Commission in 1944. 51. The Idlewild site, near Jamaica Bay in southern Queens, had been selected by Mayor LaGuardia in the fall of 1941, and construction began a few months later. As wartime and postwar demand grew, so did the project; when LaGuardia left office at the start of 1946, the Idlewild airport had expanded from its initial 1,200 acres to include a planned 5,000 acres. (See Kaufman, “Gotham in the Air Age,” pp. 158–160.) 52. See Kaufman, “Gotham in the Air Age,” pp. 158–162, 165–171. 53. “Port Authority Control Over Air Traffic Studied,” New York Herald Tribune, Dec. 30, 1945; “Regional Air Plan to Solve New York-Newark Issue?,” Christian Science Monitor, Jan. 3, 1946; “Future of Idlewild Will Affect Newark,” Newark News, Jan. 7, 1946; “Air Service Hope,” editorial, Newark Star-Ledger, Jan. 8, 1946; interview 355 and RPA notes. The start of the Port agency’s Newark studies is recorded in Tobin, Weekly Report, Jan. 10, 1946, pp. 7–8. 54. “Area Airport Authorities Seen Needed in U.S.,” New York Herald Tribune, Jan. 13, 1946. In 1946 the Regional Plan Association had little confidence that airports could be made self-sustaining financially; and the airlines preferred not to emphasize that alternative, since it would increase pressure to raise their payments to the airports. Interview 422, 1984, and Kaufman interview with RPA official, 1950. 55. Dick Kirschbaum, “Air Lanes: Airport Survey Makes Progress,” Newark News, March 18, 1946; “Expansion of Sea, Air Ports . . . ,” Newark Star-Ledger, March 21, 1946; Weekly Report, April 13, 1946; “A 25-Year Record,” editorial, Newark Star-Ledger, April 30, 1946. Good luck sometimes conspired with hard work to aid the Port Authority’s cause. For example, Lee Jaffe’s husband was a lifelong friend of an official in the Newhouse newspaper chain, who was stationed at the Newark Star-Ledger. His friendly interest in the Port Authority’s plans probably aided Jaffe in obtaining a hearing at two other Newhouse dailies, the Staten Island Advance and the Long Island Press. (Lee Jaffe, communication to the author, June 17, 1988.) 56. “City Airports and State Lines,” New York Herald Tribune, May 13, 1946; “Byrne Backs Airport Plan,” Newark News, May 17, 1946. 57. The quoted excerpts from O’Dwyer’s letter are in the New York Times, Feb. 9, 1946. For the editorial endorsement, see New York Times, Jan. 29, 1946. The Times was sure the new authority and the Port Authority would “work together for the harmonious development of New York’s air future,” and concluded that in a “more distant future” the city might consider shifting the air fields to control by the bi-state agency. On the origin and evolution of the City Airport Authority, see Kaufman, “Gotham in the Air Age,” pp. 163, 165 ff. 58. Moses selected all three commissioners, according to Caro’s account; but Caro relies on O’Dwyer’s later oral-history recollections. Kaufman, who interviewed the par-

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ticipants in 1949–50, concluded that Moses had chosen only one of the three, Laurence S. Rockefeller, and that the mayor had selected a second member (Harry Frank Guggenheim), who had accepted on condition that James H. Doolittle be the third member. Those were the three members named to the agency, and Guggenheim soon showed his independence from Moses, as described below. Kaufman’s report appears more reliable. (See Kaufman, “Gotham in the Air Age,” pp. 170–174; Caro, Power Broker, 1974, 763–767.) 59. See “Airlines Fear Moses Authority,” New York Post, Feb. 6, 1946; “Air Lanes,” Newark News, March 18, 1946. As Moses acknowledged years later, the airlines were “concerned about the inadequacy of the construction program and financing” set forth by the City Airport Authority, and they were “understandably worried about revision of their leases.” (Robert Moses, Public Works: A Dangerous Trade [New York: McGraw-Hill, 1970], p. 333.) 60. See “25,000 in Port Jobs Predicted,” Newark News, July 27, 1946; “Newark Airport Projected to Rival Idlewild,” New York Herald Tribune, July 25, 1946; “Edge Favors Airport Plan,” Newark News, July 25, 1946. 61. See Kaufman, “Gotham in the Air Age,” pp. 171–175. In the two months prior to his resignation, Guggenheim and other members of the Airport Authority had several meetings with Tobin and Cullman, where they jointly explored the “tremendous demand” for airport facilities in the New York-New Jersey area and the “regional nature” of the problem (Port Authority, confidential report, July 12, 1946). 62. Port of New York Authority, Development of Newark Airport and Seaport (July 1946), pp. 6, 37–41. 63. On July 24, for example, Moses had denounced the idea that the Port Authority might operate the airports as a regional system; he urged the agency to “get to work” on its original rail-freight program and to reduce its bridge and tunnel tolls. (“Airport Proposal Derided by Moses,” New York Times, July 25, 1946.) Moses’ hostility was also quickened by his opposition to a Port Authority proposal to build a gigantic bus terminal in “Moses territory”; that conflict is described in chapter 13. 64. See “O’Dwyer Invites Port Authority to Run City Airports,” New York Herald Tribune, August 3, 1946, where the mayor’s letter is reprinted in full. It is likely that Tobin first talked with Black and Black then called the mayor. (See Tobin, Weekly Report, April 18, 1947; and William O’Dwyer, Beyond the Golden Door [Jamaica, NY: St. John’s University Press, 1987], pp. 244–245.) 65. By the middle of August, the Newark Real Estate Board, the Junior Chamber of Commerce, the Broad Street Merchants Association, the Ironbound Manufacturers’ Association, and the Newark Advertising Club had endorsed the position that Newark’s marine and air terminals should be turned over to the Port Authority. (See “Port Authority’s Offer for Newark Airport and Seaport,” Jersey Observer, Aug. 1, 1946; “Port Authority Would Help North Jersey,” Bergen Evening Record, Aug. 1, 1946; “A Public Deal,” Newark Star-Ledger, Aug. 7, 1946; “The Port Authority Reports,” New York Herald Tribune, Aug. 13, 1946.) Among the Newark commissioners, Meyer C. Ellenstein led the city fathers in sweet vehemence, arguing that this “time-limited, arbitrary, unreasonable and highly propa-

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gandized proposal” would, if accepted, “prove disastrous to the future welfare of the City.” (Newark Star-Ledger, Sept. 11, 1946.) Mayor Murphy’s financing concerns were expressed at a hearing of the federal Civil Aeronautics Authority in October: “Our airport is sadly in need of dual runways, hangars and a new terminal building,” Murphy argued; yet his city had “other more urgent requirements. . . . We need a new city hospital. We must have new school buildings.” (His testimony is quoted in “Beyond Newark’s Power,” editorial, Newark News, Oct. 30, 1946, and in Tobin’s Weekly Report to the Commissioners, Nov. 1946, p. 226; his meetings with Hedden and Newark business leaders are noted in the Weekly Report, Aug. 16, 1946, p. 72.) 66. “Studying the Port Offer,” Newark News, Sept. 16, 1946; “A Revised Port Offer,” Newark Star-Ledger, Sept. 10, 1946. These editorials are two among many that evolved in close consultation between senior editorial writers at the daily newspapers and Port Authority officials (usually Lee Jaffe). 67. Weekly Report, Oct. 4, 1946, p. 154. Tobin and Cullman began their service with the agency in 1927, Joseph Byrne in 1934, Charles Whitman in 1935, and Frank Taylor in 1938; the remaining eight Board members had served less than five years. Close readers of earlier chapters in this book may be puzzled by Tobin’s interpretation of history. It is true that the “first reports” proposing bridges and tunnels across the Hudson (and urging crossings to Staten Island) had appeared long before the structures were approved; but the Port Authority’s own reports recommending construction of the George Washington Bridge, the three Staten Island bridges, and the Lincoln Tunnel had each led to state approval within a few months. Tobin appears to have “averaged” those prompt actions with the long years of frustration trying to gain approval for the cross-Bay rail tunnel, and perhaps with the difficulties in going forward with the Lincoln tubes during the Depression, to reach his broad conclusion. 68. After Guggenheim’s resignation, O’Dwyer had permitted the position of chairman at the Airport Authority to remain vacant. 69. Leslie Gould, “Port Authority Offers Better Airport Deal,” New York Journal American, Feb. 14, 1947. Soon after the three proposals were announced, most of the region’s major dailies endorsed the Port Authority plan, citing the argument for regional operation and other advantages noted in the text; see the Newark Star-Ledger, editorial, Jan. 14 (favoring the agency’s regional approach); New York Herald Tribune, editorial, Jan. 16 (noting its experience and strong credit rating); New York Times, editorial, Jan. 16 (citing its regional outlook and able staff); Newsday, editorial, Jan. 17 (citing the Port Authority’s “fine record . . . of nonpolitical accomplishment,” “sound enough credit” and regional scale); Daily News (New York), editorial, Jan. 28 (regional scope and experience); and New York World-Telegram, editorial, Jan. 22 (endorsing the need for regional development via the Port Authority, and noting the role of its staff writer, Allan Keller, in influencing its editorial assessment). Keller, and several of the editorial writers, had conferred with Lee Jaffe and other Port Authority officials as they reviewed the three plans. The Staten Island Advance (editorial, Jan. 15) and the Brooklyn Citizen (editorial, Jan. 21) thought the plans of both authorities deserved close attention. 70. See Kaufman, “Gotham in the Air Age,” p. 185.

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71. See Weekly Report, August 30, 1946, p. 1. Rickenbacker was then president of Eastern Airlines. 72. Letter to Paul H. Brattain, chairman, New York Airlines Top Committee, from Tobin, Jan. 24, 1947. Tobin had received reports concluding that the airports would be self-sustaining from Frederick L. Bird, Director of Municipal Research, Dun & Bradstreet, Dec. 23, 1946 (quoted in the text), and from Coverdale and Colpitts, Dec. 27, 1946. (Copies of these and other letters regarding airport negotiations are in the Austin J. Tobin files, maintained in the Office of the Secretary, Port Authority of NY&NJ.) 73. See Kaufman, “Gotham in the Air Age,” p. 186. 74. See New York Herald Tribune, Jan. 28, Jan. 30, 1947; “Gotham in the Air Age,” pp. 186–187. See also Howard Cullman, letter to William O’Dwyer, Jan. 15, 1947, with attachments (letters from six investment firms, all expressing doubt that bonds secured only by a pledge of airport revenues could be marketed). (Port Authority, Public Relations files.) 75. Weekly Report, March 14 and 22, 1947. Caro’s extensive study of Moses devotes little attention to his unsuccessful efforts to control the airports. Citing as his source an article in the New York Times, Aug. 3, 1946, Caro concludes the airport story with these words: “Removing the city’s airport program from Moses’ hands, the Mayor turned over Idlewild and LaGuardia to the Port Authority.” The August 3 article reported only that O’Dwyer asked the bi-state agency to study the issue. (See Caro, 1974, pp. 767, 1221.) 76. “City Air Leadership Periled,” New York World-Telegram, March 20, and “Airport Lag Perils 80 Million Pay Roll,” ibid., March 21, 1947. See also “Let Port Authority Run Airports,” editorial, Daily News, March 20; “Airports—Still Waiting,” editorial, New York Times, March 20; “City Should Make Pact with Port Authority on Airports,” editorial, Brooklyn Eagle, March 23, 1947. 77. Weekly Report, April 18, 1947. 78. The quotation in the text is from Kaufman, “Gotham in the Air Age,” p. 190; the March negotiations are described on pp. 190–191. On Tobin and Trippe, see also Weekly Report, April 18, 1947 and author’s interviews with John Wiley, May 11, 1984, Dec. 20, 1984, and with Lee Jaffe, May 15, 1984. The mayor’s version of the airport story is in O’Dwyer, 1987, pp. 242–245. 79. Alfred E. Driscoll, Annual Message to the Legislature, Jan. 22, 1947. For Bartholomew’s criticisms, see “Planner Says Ports Stymie Improvements,” Newark StarLedger, Dec. 12, 1946. 80. “The Governor Approves,” editorial, Newark News, Jan. 23, 1947. 81. The newspaper warning is in “Airport Decision,” editorial, Newark News, March 28, 1947, and Cullman’s speech is quoted in “Time for Decision,” editorial, Newark News, May 19, 1947. The substance and timing of these and other editorials in the two Newark papers in 1946–47 were apparently worked out in close consultation with senior Port Authority officials. 82. “Ellenstein Urges City to Keep Ports,” Newark Star-Ledger, June 5, 1947. 83. “Battle of the Deficit,” editorial, Newark Star-Ledger, Oct. 15, 1947. 84. Noting that revenues were up by one third in these early months, the News commented that “smart management,” such as adding a range of revenue-generating concessions and providing observation decks for visitors who wanted to watch takeoffs and land-

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ings—meanwhile spending money at the concessions—had made the difference (“LaGuardia Airport Pays,” editorial, Newark News, Sept. 30, 1947). The Port Authority soon added a small staff of specialists whose role in designing passenger flows at the agency’s airports was crucial; a major goal was to ensure that those waiting for planes found shops conveniently nearby. Revenues from these stores became an important contributor as Tobin and his colleagues sought ways to turn the airports into break-even operations, and the same approach was used at other airports as they were constructed and modernized in the 1950s and beyond. (For a recent discussion of the strategy, see Jennifer Steinhauer, “It’s a Mall . . . It’s an Airport,” New York Times, June 10, 1998.) 85. “Merchants for Port Lease,” Newark News, Oct. 5, 1947. The Ellenstein arguments are found in Meyer C. Ellenstein, “Know The Facts,” August 14, 1947, a printed flyer distributed widely; see also resolution adopted by the Ironbound Manufacturers’ Association, Sept. 9, 1947, and other materials included in the Newark Airport/Seaport Files of Meyer Ellenstein. (These archives were removed from Newark’s City Hall in the mid-1980s and placed for disposal at the curb, where Dr. Robert Curvin found and rescued them.) 86. The airlines’ activities are described in the Weekly Report, Oct. 11 and 18, 1947; Damon’s remarks are quoted in the Oct. 11 report. Rickenbacker’s detailed comments in favor of Port Authority control are recorded in “Public Hearing before the Board of Commissioners of Newark . . . ,” Oct. 16, 1947, pp. 124–139 (transcript); summary in Herbert Kaufman files. 87. Weekly Report, Oct. 4, 1947. Editorial writers made considerable use of Port Authority press materials in preparing their essays. The agency’s influence is suggested by similarities in editorials which appeared in the same week, reviewing the same Port Authority information; see for example the editorials in the New York Sun, July 7, and the Herald Tribune, July 8, 1947. 88. For the railroad criticism, see Newark Star-Ledger, Oct. 11, 16, 1947. On the Driscoll-Port Authority nexus, see “The Wider View,” editorial, Newark News, Oct. 12, 1947, and Driscoll’s letter to the mayor of Newark, Oct. 14, 1947 (reprinted in Tobin’s Weekly Report, Oct. 18, 1947); also Tobin’s summary of the governor’s efforts, in the Weekly Report, Oct. 25, 1947. 89. Weekly Report, Oct. 25, 1947. An initial step toward regional operation of the waterfront had been the transfer of the Gowanus grain terminal and pier from New York State to the Port Authority in May 1944. 90. In the Bay Area, two public authorities have competing programs, probably at some cost in terms of travel efficiency in the region. In St. Louis, interstate and intercity conflicts have blocked the development of better airport facilities for at least twenty years; see Alan V. Tucker, “The Politics of Airport Expansion in Denver and St. Louis,” paper prepared for the annual meeting of the American Political Science Association, Sept. 1994. 91. “Super-Agency,” Wall Street Journal, Aug. 27, 1947. 92. O’Dwyer’s letter is quoted in the New York Herald Tribune, Oct. 21, 1947. 93. The Hoboken project is described in “Offers $17,000,000 Hoboken Pier Plan,” Journal of Commerce, Sept. 16, 1947 and in the Port of New York Authority, Annual Report for 1947 (Nov. 1948), pp. 31–35; text quotation is on p. 32.

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94. However, as we will see in chapter 13, the Port Authority would still face opposition from key legislators in Albany and Trenton, a veto by Governor Dewey to block its award of construction contracts for the bus terminal, and difficult ethical problems as it sought to remove tenants in the path of the terminal. 95. Planning and development of the two truck terminals are described in detail in the Port Authority’s annual reports, 1942–1947. The text quotations are taken from the Annual Report for 1947, p. 40 and the Annual Report for 1944, p. 14. 96. Traffic and revenue figures are in the agency’s annual reports for 1941–47. 97. “A Public Deal,” Newark Star-Ledger, Aug. 7, 1946. 98. Weekly Report, April 18, 1947. 99. On Tobin’s willingness to share credit, see for example his report to the Board and his senior staff, on the agreement to take control of the New York airports. There Tobin singled out Leander Shelley and Sidney Goldstein of the Law Department for special praise: They “have worked day and night throughout the past several weeks at the exacting and nerve-wracking task of reducing the general proposal to a definitive written agreement. . . . They worked to absolute exhaustion.” His final comments caught the spirit of Tobin’s standards for the staff members on whom he relied: “they did exactly what I would have expected of each of them.” (Weekly Report, April 18, 1947.) For an illustration of Tobin’s impatience with staff delays, see the minutes of the Staff Committee on Airports, meetings in 1947–48 (in Austin J. Tobin files, Secretary’s office, Port Authority). 100. Interview 080, January 1984. Standards of expectation for the staff were captured in the award of a Distinguished Service Medal to a traffic officer who directed the flow of vehicles into the Holland Tunnel “not only with efficiency and dispatch, but also with a smiling cheerfulness that has made such favorable impression upon the users of the tunnel, that hundreds have taken the time to write the Port Authority telling of their admiration for the job he is doing.” (Port Authority press release, June 9, 1944.) 101. Henry Reining, author’s interview, March 1, 1984. Reining served as Assistant to the Executive Director in 1946–47. 102. Charles Breitel (counsel to Governor Dewey and later Chief Judge, Court of Appeals, State of New York), author’s interview, July 26, 1984. Tobin’s central leadership role was sometimes acknowledged in less kindly fashion. When Tobin abruptly fired a traffic officer in 1946 for violating the Authority’s regulations, the officer’s legal adviser, who was also a state legislator from Hudson County, argued that Tobin did not have the formal power to dismiss the officer. A search of the New Jersey statutes, he argued, “fails to disclose one iota of authority for this ‘one man’ rule a la Huey Long and this usurpation of the statutory duties of the Commissioners.” (“Dismissed Officer Asks Court Review,” Newark News, Jan. 17, 1946.) The dismissal was upheld. 103. Selznick, 1957, p. 17; and see Note 3 above. The link to the Catholic Church noted in the text was suggested by two long-time friends of Tobin (author’s interviews 33 and 76). 104. Port Authority, Annual Report for 1946 (Nov. 1, 1947), pp. 2 and iii-iv. For Tobin’s views, see his address before the New Jersey Association of Real Estate Boards, Nov. 1947; and “P.A. Waits Only for Hoboken on Pier Project; Tobin Tells Also of Rapid Transit Survey,” Jersey Observer, Nov. 24, 1947. On rail transit, Tobin appears to have been temporar-

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ily infected by the “Edelstein principle,” for rail passenger projects seemed very unlikely to meet their full costs, even in the long run. Chapter 12 1. Speech at the Citizens’ Budget Commission, annual dinner, Jan. 17, as quoted in the New York Herald Tribune, Jan. 18, 1949. 2. James MacGregor Burns, Leadership (New York: Harper, 1978), p.39. 3. In the early 1940s, Tobin and Edelstein had considered that the Port Authority might include some projects that were not likely to become self-supporting, even in the long run; however, as indicated in chapter 11, that position had been discarded as politically and economically unwise. As noted earlier, an “efficient” transportation system was defined at the Port Authority (and by urban planners more widely) as one which met high standards of capacity, speed and reliability, at minimum cost. See for example the agency’s Annual Report for 1946: “The Port of New York faces the basic problem of improving its local transportation and terminal systems in order that it may continue to be . . . an efficient gateway for trade and travel. The vital streams of commerce must flow swiftly, surely and economically, if this community is to maintain and expand its position as an important world port” (p. 1). 4. As the railroad presidents commented during their battle with the Port Authority in the 1920s: “To eliminate the competition which now exists . . . [would] eliminate in every way the human element which plays an important part in their present efficiency. . . . If anything is done to eliminate competition, service is likewise going to suffer.” (“Statement on Pooling Railroad Marine Equipment,” April 27, 1927; see chapter 5.) 5. The first statute protecting the Port Authority from competition was approved in connection with the Goethals and Outerbridge spans; see section 5 in Laws of New Jersey (ch. 37) and Laws of New York (ch. 210), 1925. In 1926, similar legislation protected the George Washington Bridge, with a proviso that a crossing below 60th Street was exempted (i.e., Lindenthal’s span); see Laws of N.J. (ch. 6) and Laws of N.Y. (ch. 761). State legislation giving the Port Authority control over all airports in the bi-state region was viewed as too difficult to obtain, since legislators would not have been willing to block their own smaller cities and counties from building airfields at some later date. On city and state “monopoly” legislation for airports, see U.S. House of Representatives, Committee on the Judiciary, Port of New York Authority, Hearings before Subcommittee No. 5, 1960, vol. 2, pp. 360–362, 395–401. 6. “Without adding to the tax burden” is quoted from Port Authority, Annual Report for 1948 (April 15, 1949), letter of transmittal; it appears in many other agency reports. For endorsement of these views by its supporters in the early Tobin years, see the Christian Science Monitor, May 5, 1946; editorial comments in the New York Times, New York Herald Tribune, Newark Evening News, and Newark Star-Ledger (all April 30, 1946) and New York Times, August 13, 1946; these and many others are gathered in Port Authority, 25th Anniversary, published by the agency in the fall of 1946. 7. Recollections of Robert W. Tuttle, American Airlines official in the 1940s, in letter to the author, May 31, 1984.

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8. Machiavelli’s view was that anyone who proposes innovations “has only lukewarm allies in all those who might profit from the new” (The Prince, chapter 6). 9. Mayor LaGuardia’s views were later recalled by a central member of his administration: “LaGuardia and I wanted the airlines to establish their system maintenance bases at Idlewild. We wanted the big payrolls which such bases contribute to a city’s economy” (letter to Herbert Kaufman, March 17, 1950). The inter-city rivalry and LaGuardia’s victory are described in Herbert Kaufman, “Gotham in the Air Age,” in Harold Stein, ed., Public Administration and Policy Development, 1952, pp. 153–158. An official at American Airlines at the time, Robert Tuttle, later recalled the division within the airline industry, and the outcome: When LaGuardia said he would turn North Beach into a major airport, Rickenbacker of Eastern and other airline executives criticized his effort, arguing that their Newark facilities “were more than adequate for all the airlines’ needs and it would be folly . . . to suffer duplicate operating costs in New York.” However, C. R. Smith, president of American Airlines (then headquartered in Chicago) was interested in LaGuardia’s plans, and he sent his assistant, O. M. Mosier, to talk with the mayor. Mosier reported that the new airport was close to Manhattan and had “limitless” traffic potential; moreover, LaGuardia was offering rental rates and flight fees that were “so easily affordable that it would be unwise not to commit for the choicest accommodations.” In 1939, American signed a 40-year agreement at the airport, leasing three of the six hangars and half the gate positions; it also agreed to move its maintenance and corporate headquarters from Chicago to North Beach (formally titled “New York Municipal Airport, LaGuardia Field” when it opened in December 1939). In Tuttle’s view, “American’s decision stunned the industry” and the other Newark carriers soon leased the rest of the space at LaGuardia and shifted their main operations from Newark. (Tuttle, letter to the author, May 31, 1984.) 10. On the airlines’ strategy, see Charles S. Rhyne, Airport Lease and Concession Agreements (Washington, DC: National Institute of Municipal Law Officers, 1948); on the competition for sports teams, see Charles C. Euchner, Playing the Field: Why Sports Teams Move and Cities Fight to Keep Them (Baltimore: Johns Hopkins University Press, 1992), and Michael N. Danielson, Home Team: Professional Sports and the American Metropolis (Princeton: Princeton University Press, 1997). 11. The airlines’ antagonism to Moses’ position was heightened by his behavior in the summer of 1946. In early July, he sent the executives a letter stating that the existing leases were technically invalid, because they had been signed under the wrong section of the city’s code; he then summoned them to a meeting and demanded that they sign new leases at higher rates by August 15. They refused. (See New York Times, July 9, 10, 1946; New York Post, July 12, 1946; Tobin, Weekly Report, July 12, August 23, 1946.) 12. Frederick L. Bird, Dun & Bradstreet, letter to A. J. Tobin, Dec. 23, 1946. The other general review was carried out by Coverdale & Colpitts, which concluded that under the agency’s plans, the airports “should be self-supporting” (letter to A. J. Tobin, Dec. 27, 1946). Tobin had seen no danger signs when he and Buckley first studied the leases, and in July 1946, he commented to the Board: “During 1945 the City had signed leases with the airlines for the development of Idlewild. The rates and charges . . . were the highest that the airlines had ever agreed to pay at any airport in the country.” Tobin noted that the Port

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Authority’s plans for Newark were based on the same scale of airline charges, and he praised Buckley for the “magnificent job” he had done in analyzing traffic and revenue patterns at Newark Airport (Weekly Report, July 12 and Oct. 11, 1946). 13. A. J. Tobin, letter to Paul H. Brattain, chairman, New York Airlines Top Committee, Jan. 24, 1947. 14. For example, Pan American’s president, Juan Trippe, testified at the New York City hearing on airport development, on behalf of 17 airlines. “Only the Port Authority’s program is adequate in scope and concept,” he argued; “only the Port Authority has the experience and the tested credit which will enable it without delay to do the job.” (Testimony before the Board of Estimate, Jan. 29, 1947.) 15. Weekly Report, May 2, 1947. 16. Hervey Law’s appointment provided an opportunity for Aviation Week, an industry journal, to lash out at the tradition of airport management, while praising the Port Authority and its “sagacious choice” of a “proven administrator” who should be able to operate airports as a “business,” insulated from politics. In contrast, “municipal airports in this country have been cursed with politics,” the editorial writer argued. The selection of an airport manager has often been decided by “the local political wolves, who shoved an incompetent into the spot” or, selecting an able person, then hemmed in the position with rules that blocked initiative. (Editorial, July 14, 1947.) 17. Weekly Report, Sept. 20, 1947; emphasis added. 18. Austin J. Tobin, “Financing the Airports and Marine Terminals of the Port of New York,” Nov. 11, 1947, p. 17; New York Times, Nov. 15, 1947. 19. All quotations are from memoranda to the author from Robert W. Tuttle, official at American Airlines in the 1940s, May 31, 1984, and from airline official #3, August 3, 1984. Rickenbacker was viewed by his colleagues as “the toughest man in American industry,” and Trippe was seen as “devious” (memorandum to the author from airline official #3). Cf. Serling, 1985, a largely sympathetic treatment of the airline industry, which describes C. R. Smith’s reputation as a “strong leader” with an “arbitrary” personality, and Trippe’s “awesome” lobbying strength in Washington as well as his sustained effort to obtain a monopoly for Pan Am in handling all U.S.-flag international air service (pp. 77–78, 186–189). 20. John R. Wiley, notes to the author, Aug. 10, 1984. Wiley joined the Port Authority in 1950, after several years with American Airlines; he was director of the Port agency’s Aviation Department, 1955–72. Another Port Authority official with earlier airline experience thought that Tobin simply “had never rubbed shoulders with the real world” during his earlier years. “He took their business dealings—their manipulations—too personally.” (Fred Glass, director of the Aviation Department, 1949–55; author’s interview, Feb. 28, 1986.) 21. George Whiteside, attorney for the U.S. airlines in the lease controversy, 1948–49, as quoted in the New York Times, Nov. 17, 1948. 22. Weekly Report, Jan. 24 and April 3, 1948, from which the quotation is taken. I am indebted to Bevin Carmichael for her extensive efforts, in identifying and organizing the several hundred pages of materials on which this analysis of Tobin’s activities and the national coalition is based. (Unless otherwise indicated, the materials cited below are in the Airport Lease Negotiation files, in the Executive Director’s files for the 1940s, or in Tobin’s Weekly Reports, which include newspaper clippings.)

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23. The general perspective described in these paragraphs is drawn from Austin J. Tobin, “Financing the Airports and Marine Terminals of the Port of New York,” Nov. 11, 1947; Tobin, informal notes, Feb. 16, 1948 (an extensive description of his views, prepared for use in a February conference with the airlines executives); and several discussions with John Wiley, who served with the airlines for a decade ending in 1950 and then as a senior Port Authority official, 1950–1972. 24. Tobin’s notes prepared for this meeting capture his main points, though in abbreviated form: “ . . . such rental inequities as we inherited at LaGuardia—an airline occupying one of the finest hangar and base properties . . . on a 40-year lease at 12c a foot, whereas other airlines in less desirable hangars at the same field pay 88c . . .—full understanding of circumstances—would have done same thing myself. . . . [but] we do not believe that we can conduct a sound airport business on the basis of inequity and unfairness as between our individual airline tenants, and future airlines.” (Tobin, notes, Feb. 16, 1948, pp. 8–9.) Tobin also pointed to political pressures on his agency: “We could not continue to siphon off the earnings of one group of facilities to support the deficits of another–AAA agitation as an example” (Tobin, notes, p. 6). AAA is the American Automobile Association, whose officials were active in the campaigns to reduce toll levels and to establish commuter rates on the agency’s bridges and tunnels. 25. Tobin’s arguments are found in his notes, Feb. 16, 1948, p. 8. The airline reactions and his own optimism are reported to the commissioners in his Weekly Report, Feb. 21, 1948. 26. Weekly Report, March 20, 1948. See also A. J. Tobin, letter to C. R. Smith, Mar. 29, 1948; Weekly Report, April 27, May 8, June 5, 1948; and Howard S. Cullman, Address before the Aviation Writers Association, May 12, 1948, with its olive branch (thanking the “great airlines that service this area” for their support for the Port Authority’s air terminal program) and its emphasis on the need for self-supporting airports with “equal service and equitable charges for all” (p. 15). 27. Weekly Report, April 3 and April 10, 1948. Under those two unusual leases, flight fees were based on weight of the aircraft, which was logically related to wear on the airfield and somewhat linked to the airline’s revenues from air freight. The LaGuardia leases did not consider weight, instead reducing the fee per takeoff if the air carrier flew more flights than its (smaller) competitors. Also, the San Francisco leases permitted changes in flight fees every year, depending on airport modernization needs and other factors; the LaGuardia flight fees and other charges were locked in for 40 years, permitting modest changes only at 10-year intervals. 28. While the ATA members were protesting the Port Authority’s $8.77 charge for landing a DC-6 at Idlewild, for example, Tobin and his allies learned that the DC-6 fee at London had recently been set at $61.75 per landing (Weekly Report, June 12, 1948). Broadened discussions with London and other overseas airports led, a few years later, to expansion of the AOC to include airport operators around the world; it was then retitled the Airport Operators Council International (AOCI). On the AOCI and the ATA, see John R. Wiley, Airport Administration and Management (Westport, CT: Eno Foundation for Transportation, 1986), pp. 40–43. Governor Bradford was directly involved in the airline conflict because the Boston air-

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port, deep in the red, was taken over by the state in 1948, and state officials were pressing for higher fees from the airlines and other users. When Bradford’s aides proposed increased rates for renting hangars or other services, “we were told [by the airlines] that the provisions in our proposal were less favorable than those which prevailed at LaGuardia or San Francisco.” When they tried to “readjust landing fees or take-off fees, we were assured . . . that airports elsewhere found schedules somewhat like our old ones entirely satisfactory.” Bradford argued that it was time to put to rest the notion that “government in business is always to be played for a sucker” and that the cities and states should no longer “grope around, each of us, in the dark.” (Weekly Report, April 3, 1948, which describes the AOC conference and includes portions of Bradford’s address.) The AOC conference also included much discussion of strategies for increasing nonflight revenue; see the summary in “Airport Finance: Chronic Money Losers Reform,” Wall Street Journal, Apr. 15, 1948. 29. Charles S. Rhyne, Airport Lease and Concession Agreements, 1948; Foreword by Fred Van Liew (chair of the legal officers’ airports committee), p. 8. Rhyne cited the ATA lease agreement, “foisted upon cities,” as an important factor in deficit operations at the airports; he discussed the airline strategy of threatening to bypass a city “if you don’t do as we say”; and he argued that the unified ATA approach “impedes the progress of small airline companies which are literally forced to accept and endorse the higher demands of the larger companies,” so that cities which would be willing to give better terms to startup airlines were unable to do so (Rhyne, 1948, pp. 13, 30–31). Rhyne noted that Sidney Goldstein, Tobin’s assistant general counsel, had closely reviewed “each section of the report” and provided detailed information on the Port Authority’s experience—for example, how the agency set terms for stores and other concessions, and what its views were on the revision of leases at Idlewild (pp. 14, 58 ff., 163 ff.). 30. “The Landlords and the Tenants” (editorial), Airports and Air Carriers, June 1948, p. 50; “The Airlines and Idlewild” (editorial), June 26, 1948; Gill Robb Wilson, “The Air World,” New York Herald Tribune, June 11, 1948. The AOC’s expanded activities are described in Tobin’s Weekly Report, June 19, 1948; Port Authority staff members chaired two of the new committees. 31. See Chicago Journal of Commerce, July 26, 1948. For discussion of changes at Boston and other AOC developments during these months, and reflections on similarities with strategies used by the Conference on State Defense to defend tax-exempt securities, see Austin J. Tobin, “Introduction to a Discussion of National Municipal Policy,” address before the American Municipal Association, Dec. 12, 1948 (PA Library). Tobin’s speech also links the AOC activities to the wider issue of maintaining local-government vitality in a democracy. 32. Speaking for the Port Authority, Buckley said that federal restrictions of this kind would probably lead his agency to refuse to accept federal funds, and he thought most large airports would take the same position. He assailed the bill as “special interest legislation” designed only to aid the airlines and likely to harm the national airport program (Newark Star-Ledger, May 21, 1948). The ATA argument that flight patterns for the two airports were too close is reported in Tobin’s Weekly Report, June 5, June 19, 1948; Port of New York Authority, “Notes with

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Respect to the Use of New York International Airport . . . ,” staff document (n.d., caJune 1948), p. 2. 33. Journal of Commerce, June 16, 1948; Weekly Report, June 5, 12, 26, Sept. 25, 1948; Port Authority, “Notes . . . ” (June 1948), p. 2. 34. The New York Times captured this part of the conflict in its headline: “Idlewild Opposition Cracks; Air France Is First to Sign” (June 14, 1948); and see Weekly Report, June 26, 1948. 35. Robert W. Tuttle, former American Airlines official, interview with the author, May 15, 1984; see also comments by Louis Calta, a staff member in Eastern’s head office in 1947–48 (author’s interview, Feb. 10, 1986). A joint ATA venture at Teterboro might have built on an earlier ATA experiment, to supply terminal services at U. S. airports. In 1946, the major airlines had formed the Airlines National Terminal Service Company (ANTSCO), which began by operating ramp, passenger and other services at Detroit and Cincinnati airports, with the hope that it could then expand to other cities. In the summer of 1948, however, the airlines decided to dissolve the joint effort because of “friction among the carriers.” Reminiscent of the difficulty which the railroads had in working cooperatively, the individual airlines apparently interfered in ANTSO’s operations, and they seemed “unwilling to give up any of the preferential treatment which they were able to secure when operating individually.” (Serling, 1985, p. 220; Tobin, Weekly Report, July 10, 1948.) Tobin’s early interest in a fourth jetport is recorded in his notes for the meeting with airline executives, Feb. 16, 1948, p. 13A. 36. Teterboro’s owner, Fred Wehran, told local reporters in late June that top airline officials “have been here for weeks. . . . And they’re satisfied with what they have seen.” Wehran opined that his 500-acre airport could be doubled in size easily, so it would be “ready for the biggest airliners afloat in 90 days” (Newark News, July 1, 1948). Wehran said that, if he kept the airport, his income would come mainly from gasoline sales, so he would not have to charge landing fees. But he thought maybe he could sell the airfield to “a big outfit”—perhaps the Port Authority (New York Herald Tribune, July 2, 1948). On the Port Authority’s early hopes for Teterboro, see James C. Buckley, “The Port Authority Airport Program,” address before the Bergen County Chamber of Commerce, Sept. 22, 1948, p. 5. Similar optimism is expressed in Tobin’s Weekly Report, Sept. 4, 1948, and the Port Authority, Annual Report for 1948, pp. 7–8. On the airlines’ tactics, see Newark News, Aug. 4, 1948. 37. The editorial in the New York Herald Tribune is illustrative: The addition of Teterboro “rounds out a system of major air terminals,” a system which could only have come about “through such an organization as the Port Authority . . . free to direct the development of ground facilities on an efficient and economic basis” (August 14, 1948). On the declining hopes for Teterboro, see the Port Authority, Annual Report for 1949, pp. 51–52; Annual Report for 1950, pp. 22, 77–78; Annual Report for 1952, p. 31; Annual Report for 1953; p. 39. The limitations of the airport are discussed in Tuttle, author’s interview, May 15, 1984; John Wiley, author’s interview, Jan. 8, 1985. Buckley’s forced departure is described in confidential interview 310, July 17, 1984, and Louis Calta, author’s interview, Feb. 10, 1986.

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38. The ATA’s efforts to enroll O’Dwyer are reported in New York Herald Tribune, Aug. 23, 31, 1948. The ATA rumors regarding the Air Terminal bonds are noted in Tobin’s Weekly Report, June 19, 1948. The bonds were protected not only by the link to the General Reserve Fund, but also by the 1947 airport legislation, which protected bondholders and the agency from any state legislative efforts to limit Port Authority landing fees and other charges: “The two states covenant and agree with each other and with the holders of any bonds of the Port Authority issued or incurred for air terminal purposes . . . that the two states will not, so long as any of such bonds [remain outstanding] . . . impair the power of the Port Authority to establish, levy and collect landing fees, charges, rents, tolls or other fees” (Chapter 12 of Laws of N.J., Ch. 43, and Laws of N.Y., Ch. 802). 39. See David Frank, “Airport Report: Big Flying Fields Aim to Hike Airlines’ Fees... ,” Wall Street Journal, Aug. 7, 1948, and “Port Authority Lays Sabotage to 9 Airlines,” New York Herald Tribune,” Aug. 30, 1948; also, “Airlines’ Charges Flayed by Cullman,” Journal of Commerce, Aug. 30, 1948; “The Port Authority and the Airlines” (editorial), The Sun, Aug. 31, 1948; Richard P. Cooke, “N.Y. Airport Squabble to Affect Other Cities,” Barron’s, Sept. 6, 1948. The article in Barron’s, written by a staff member of the Wall Street Journal, concluded that “from a neutral vantage point, the Authority’s logic appears sound,” and that if it “succeeds in imposing its program on airlines here, it probably will become the pattern for most of the country.” 40. The Port Authority had expected to transfer all overseas flights from LaGuardia to Idlewild, as soon as temporary air terminals and facilities were available. When the airlines resisted in a bloc, the agency could force only the foreign-flag carriers to shift, since they had short-term leases. SAS and KLM then lodged diplomatic protests in June, arguing that the Port Authority was discriminating against foreign-flag carriers. The State Department conferred with Tobin and assured the Scandinavian and Dutch governments that the Authority would treat all airlines equally: “all international overseas air operations at LaGuardia” would be ended as soon as terminals and other services were available at Idlewild, and at a time “not expected to exceed eighteen months.” When they realized what had happened, the U.S. airlines scrambled to undo the damage. As Tobin reported to his commissioners in the fall: “We understand that they are very active in Washington seeking to reverse the State Department’s commitment,” arguing that the U.S. airlines should not be forced to shift to Idlewild without their own consent. (Weekly Report, Sept. 25, 1948, which includes the quoted portions of the State Department letter of June 25, endorsing the shift of all international flights to Idlewild.) 41. See “Moore Aiding Airlines,” Newark News, Oct. 22, 1948; Weekly Report, Oct. 23, 1948. According to Tobin’s report, Whiteside told him that Moore had been hired to offer legal advice regarding “the Governor’s veto power over acts of the Commissioners of the Port Authority, and also as to the quorum provisions of the Port Compact” as they might limit the validity of some Board actions, and that Moore “would discuss these problems with the New Jersey Commissioners” (p. 7). Whiteside’s meeting with the Port agency’s commissioners is described in Howard Cullman, letter to George Whiteside, Nov. 15, 1948. In his threat to sue the commissioners, Whiteside criticized the agency’s leaders for their “blockade” at Idlewild. “They refuse to let us operate under those leases,” Whiteside argued; “instead they seek to force upon us a new system, not contemplated in the leases, but

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borrowed from Europe and at variance with the general practice in the United States. . . . It is an attempt to force on us at this critical stage an ideology never contemplated in the leases” (New York Times, Nov. 17, 1948). 42. See Cullman letter to Whiteside, Nov. 15, 1948, pp. 1–3, 6–8, and “Port Authority Bars Change in Charges to Big Air Lines,” The Sun, Nov. 15, 1948; “Cullman Affirms Stand on Idlewild,” New York Times, Nov. 16, 1948; and “Coming of Age” (editorial), Newark News, Nov. 18, 1948, which again quoted the “infamous document” charge against the ATA lease. Tobin had responded earlier to the ATA plea: “We will be glad to discuss any proposals your clients may have for reasonable modifications. . . . We cannot, however, consent to [Idlewild’s] use at non-compensatory rates or upon terms and conditions which would discriminate as between users.” (A. J. Tobin, letter to George Whiteside, Oct. 8, 1948, p. 2.) Tobin also argued that the gasoline distribution system, airport roads, and the ramps “should be operated on a public utility basis . . . open to all users, upon the payment of fair and reasonable charges, . . . and without unjust discrimination” (p. 4). He rejected Whiteside’s view that the “principle of the existing leases,” entailing reduced charges per landing for the most active airlines, be maintained; on the contrary, Tobin reaffirmed, the agency opposed that kind of reduction as “unjustly discriminatory against the smaller airlines” (p. 6). And he revealed that the Port Authority had agreed, as a condition of receiving federal aid, that it must operate the airport on the basis of these principles! (p. 8). These letters are included in the Airport Lease Negotiations files, in the Executive Director’s files for the 1940s. 43. New York Herald Tribune, Dec. 14, 1948. The journalist who tried to understand Tobin’s 1947 letter was Allan Keller; see his “Solomon with Law Degree Needed to Settle Idlewild, Airlines Row,” New York World-Telegram, Nov. 24, 1948. Keller, his newspaper’s aviation expert, quoted Tobin’s January 1947 letter, which he found to be a “mystery” since it was contrary to the agency’s current position. With a little assistance from the bi-state agency, he also described another mystery—Pan American’s behavior outside the U.S., which violated the ideals that it and the other ATA members were defending against the Port Authority. Pan Am owned an airport in Havana, and it charged Braniff and other airlines $105 per landing for a DC-6, with “no reduction for additional flights—the very principle for which it is battling at Idlewild.” Although Tobin’s failure to honor his 1947 assurances did not attract much public criticism, it was a matter of concern to some board members and to Tobin himself. In the days leading to the commissioners’ meeting with Whiteside in mid-November, Tobin sketched out a plausible line of thinking that might justify both the final sentence of that January 24 letter and his later position, which demanded that the airlines renegotiate fundamental elements of the leases and accept an increase in rates. Finally, he had to admit that “this sentence should not have been written,” and that admission was included in a lengthy analysis of the lease situation sent to all the commissioners and to William Ogden of the New York Times’ editorial board. (See A. J. Tobin, letter to the Commissioners, with enclosure, Nov. 5, 1948.) 44. Heavy planes could not land at LaGuardia because of its marshy soil, and Newark

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Airport’s runways also were not stable enough for the new planes. In the early weeks of the new year, Pan Am, Northwest, and American Overseas would receive a total of 36 Stratocruisers (New York Herald Tribune, Jan. 26, 1949). 45. See New York Times, Jan. 18 (for the “bitterness” quote), and Times, Jan. 20, 26, 1949; Daily News (New York), Jan. 28, 1949; New York Herald Tribune, Jan. 18, 26, 1949. 46. See Weekly Report, Feb. 19, March 3, 12, June 11, 1949. 47. Weekly Report, March 26, 1949. The Port Authority’s annual report, made public a few weeks later, underscored the agency’s aggressive stance. The commissioners’ letter of transmittal to Governors Dewey and Driscoll described the 1945 leases as “valid and binding regardless of their unconscionable terms”; the agency would not provide any services “that are not covered or provided for” in the 1945 agreements until the airlines agreed to “renegotiate the unsound, unworkable leases.” (Port Authority, Annual Report for 1948 [April 15, 1949], transmittal letter; see also pp. 36, 39.) 48. For the airlines’ complaints, see New York Times, June 14, 1949; Newark News, June 14, 1949. Tobin conveyed his impressions of one meeting with the airline officials in his Weekly Report to the commissioners (June 11, 1949): Cullman, Byrne, counsel Leander Shelley and he were present, and “we were subjected to four hours of abuse, invective, and name-calling and every conceivable insinuation and reflection upon our honesty, truthfulness, and reliability. . . . When we presented figures as to our losses . . . in the preparation of the airports they said that our accountants were using ‘phony’ figures. . . . They said that the Port Authority’s losses in the operation of the airport were none of their affair and that all fees and charges must be incorporated in long-term leases at fixed rates.” 49. Praise for Idlewild is in the New York Herald Tribune, July 2, 1949, and the Long Island Sunday Press, July 3, 1949. The criticisms of legal fees are in the Newark News, June 21, 1949, which reported that one airline paid $340,000 to the Whiteside firm in 1948, and outside legal and consultant fees totaled $1.5 million that year. Meanwhile, long-term airline debt had risen sharply, from $1.5 million in 1941 to $173 million in 1949. 50. Port Authority, “Memorandum Regarding Events Leading to the Agreement . . . , Section I: Meeting with Governor Dewey on July 21, 1949,” p. 2. 51. Recollections of Bayard Pope, as reported in Port Authority, “Memorandum Regarding Events . . . ” (hereafter MRE), Section I, July 21, 1949, p. 1. Within the industry, the understanding was that the airline executives had conveyed these concerns to Dewey, in the hope that he would take the issue out of the hands of Tobin and his Port Authority commissioners. Discussion below of Dewey’s intervention is based mainly on MRE, Section I, and also Section II (July 29), and Section III (August 4–5); these are extensive summaries of several meetings, as prepared by Tobin’s assistant, Matthias Lukens, who was present throughout. See also New York Times, July 27, 30, 1949; Weekly Report, August 13, 1949; Charles Breitel, interview by the author, April 7, 1986. Breitel was Counsel to Governor Dewey, 1943–50, and his chief adviser on the lease issue, 1949–50. 52. MRE, July 21, 1949, pp. 2–3; emphasis added. 53. MRE, pp. 3–4. The summary of this meeting in the paragraphs below is drawn from MRE, July 21, pp. 3–7.

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54. Dewey limited his invitations to the four airlines which operated Boeing Stratocruisers (Pan American, American, Northwest, and British Overseas), since their interest in using the large planes fully loaded meant that they had the strongest incentives to agree to new leases at Idlewild which would give them ticket counters, telephone service, etc. 55. Dewey’s optimism is conveyed by the headline in the July 30 New York Times: “Great Progress Made to End Row at Idlewild, Dewey Says.” The summary of the second meeting is drawn mainly from Port Authority, MRE . . . , July 29, 1949, pp. 2–8, and the Times story. 56. For those interested in some flavor of the 23-hour August 4 marathon, here are a few excerpts from the Port Authority’s summary of the discussion on how the landing fee would be set: “The Governor . . . expressed concern at the rate which we suggested of 15.05 cents per thousand pounds. . . . [We] explained all of the additional expenses that went into making up the [rate]. . . . He said the rate was just too high. . . . After a lengthy discussion with the airlines, the Governor asked Commissioner Pope, Messrs. Tobin and Kushell to step into his meeting with the airlines. Mr. Kushell [the Authority’s comptroller] was then required to go into a detailed discussion of our entire cost accounting system. Mr. Clement later joined the discussion after having secured all of the necessary books and records from the Port Authority building. This discussion lasted from two to three hours, and every phase of our accounting system was explained to the Governor and the airlines. . . . Mr. Tobin then brought Mr. Kyle [chief engineer] into the discussion and he gave a justification for all of the depreciation rates for capital improvements. . . . Governor Dewey got Commissioner Pope and Mr. Tobin aside and said that he would not go along with the 15.05 cents per thousand flight fee. He said, however, that he could sell the airlines on accepting a base rate of 13.22 cents per thousand pounds.” Pope and Tobin agreed, but only if an assumed number of plane take-offs was accepted by the airlines, which would increase their payments somewhat. The airlines, which had initially wanted a flight fee limited to 10.76 cents per thousand, finally accepted this proposal. (Quoted from MRE, August 4–5, pp. 2–3.) 57. MRE, August 4–5, p. 6. The discussion also provided some insight into why the airlines’ own effort to operate a joint terminal service at other airports had failed. At one point, both sides agreed that the Port Authority would be able to increase flight fees to cover new costs at Idlewild; Port Authority staff then said that they would spend added funds when they thought them essential (for runway repairs, etc), and if the airlines objected to including the sum in calculating flight fees, they could appeal to an arbitrator. The air carriers objected, arguing that they wanted the right to have any airline challenge an expenditure before it was made; and Dewey agreed. In that case, the Port Authority responded, the lease would need a clause that absolved the Authority from liability if (for instance) one airline objected to repairing a runway and while repairs were delayed, a plane hit a runway hole and was damaged; the objecting airline should be liable, instead. Now Dewey agreed with the Port Authority, “whereupon the airlines took violent exception . . . [and] the Governor withdrew his decision and left the whole question up in the air.” There it remained when the marathon ended. (As Tobin pointed out, there would be more than 15 airlines operating out of Idlewild, and essential repairs

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could be blocked if any one airline failed to grant prompt approval.) MRE, August 4–5, 1949, p. 8. 58. At the July 29 session, Dewey said that he had talked with Governor Driscoll, and that they both agreed that the bi-state agency should no longer be immune from suit. (MRE, July 29, p. 8.) Breitel, who was Dewey’s chief adviser on Port Authority issues, was certain that this problem would need to be solved in any event. “I was shocked by the extent of their uncontrollable autonomy,” he later recalled, “especially by their complete non-suability.” (Breitel, interview with the author, April 7, 1986.) 59. “Idlewild Dispute Is Ended on Terms Drawn by Dewey,” New York Times, August 6, 1949; “The Airport Settlement” (editorial), New York Times, August 6, 1949; “Of National Significance” (editorial), Newark News, August 7, 1949. 60. In response to Tobin’s August mailing, the director of aviation in Kansas City wrote, “The Port of New York Authority has added a land mark in the field of equitable bargaining”; the Detroit airport director commented that the agreement is a “victory for the airport operators”; and the chairman of the Civil Aeronautics Board noted his opposition to the old sliding scale and endorsed the “equitable result” (all excerpted in Weekly Report, August 20, 1949). With the encouragement of the Port Authority and other airport operators, the Civil Aeronautics Administrator had, in the spring of 1949, begun a series of meetings between the operators and airlines, focused on the problem of airport charges. According to Tobin’s report to his Commissioners, the first meeting had been marked by “hostility and disagreement”; but by the fourth, in September, the airline representatives, led by Mosier, were cordial and ready to accept new principles for setting airport fees (Weekly Report, Sept. 17, 1949). 61. Robert W. Tuttle, letter to the author, May 15, 1984, p. 6. For the other quotes above, airline official #3, May 31, 1984; John Wiley, notes, August 10, 1984. 62. See John Kenneth Galbraith, American Capitalism: the Concept of Countervailing Power (New York: Houghton Mifflin, 1956); see pp. 111–112. His argument is that “private economic power is held in check by the countervailing power of those who are subject to it”; for example, in response to the power of business management to set wages, workers organize into labor unions as a way to “defend themselves against exploitation.” For further discussion of Galbraith’s thesis in relation to the ATA-AOC dynamic, see J. W. Doig, “Countervailing Power: the Creation of Governmental Coalitions in Response to Corporate Monopoly,”paper prepared for the annual meeting of the American Political Science Association, 1995, pp. 1–5, 51–59. For a recent critique of airline competitive strategies which are labeled by critics as “monopolistic,” see Laurence Zuckerman, “Open Skies, Closed Markets?,” New York Times, March 18, 1998. In this case, the complaint has been brought by Frontier, Reno Air, and other low-cost carriers, against American, United and other major carriers, alleging predatory pricing to drive the small airlines out of business. 63. For a critique of traditional politics at local airfields, see Aviation Week in 1947 (quoted in Note 16 above). On the AOC and the movement to professionalize airport management, see the discussion earlier in this chapter of special AOC committees created in 1948, and Wiley, 1986, esp. chapters 2, 4, 6, 12.

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64. See for example, Henry Ladd Smith, Airways (New York: Knopf, 1944); Oliver Allen, The Airline Builders (New York: Time-Life, 1981); Serling, Eagle, 1985. 65. For Dewey’s views, see for example his praise in 1946 of the agency’s “enviable record” (public letter to Howard Cullman, April 26, 1946), his support of the Port Authority’s Idlewild project at the ground-breaking in July 1948, and more generally Dewey’s passion for professionalism in government and his wariness of “low politics,” as described in Richard Norton Smith, Thomas E. Dewey and His Times (New York: Simon and Schuster, 1982), pp. 30–31, 38–40ff.

Chapter 13 1. Lewis Mumford, “The Sky Line: Masterpiece of Mediocrity,” The New Yorker, March 10, 1951, p. 85. (Mumford was disappointed that the Port Authority had not matched the high level of its previous works, particularly that “splendid monument,” the George Washington Bridge.) In this chapter, discussion of the bus terminal refers to the building completed in 1950, which extends from 40th to 41st Street. The terminal was expanded north to 42nd Street in the 1970s. 2. For the bus companies, driver salaries and other costs connected with navigating through midtown traffic were a significant drain on revenues. Most bus passengers would lose little time, since they could transfer to the Manhattan subway system, which was faster than bus travel on local streets. Many bus passengers used the subway from their bus-station endpoints, in any event. (See Port of New York Authority, “Union Bus Terminal for Midtown Manhattan,” Sept. 3, 1940; PA Library Doc 40–1018.) 3. Robert Moses, letter to State Planning Commission, April 27, 1944; quoted in New York Herald Tribune, May 3, 1946. LaGuardia’s earlier concerns about bus congestion were revived in 1944, because trans-Hudson traffic was again expanding, and the second tube of the Lincoln Tunnel would be completed in February 1945, stimulating a larger flow of buses onto midtown streets. (The Port Authority had obtained permission to complete the second tube in order to aid the movement of wartime goods.) 4. The new terminal, initially called the “Grand Central Bus Station,” would occupy the entire 800-foot block between Eighth and Ninth Avenues, north from 40th to 41st Street (Port Authority, Annual Report for 1944, pp. 17–19). 5. The resolution proposed by the Port Authority stated that the Board of Estimate would not approve a new bus terminal, or permit an existing bus terminal to be expanded, east of Eighth Avenue between 23rd and 59th Streets. At that time, thirty interstate bus companies delivered passengers to various street curbs and bus stations within this zone. 6. “The Greyhound people might as well know right now that our first interest lies in the Port Authority Terminal to which we are committed. . . . The Greyhound comes second. . . . They are not entitled to grab business from the Lincoln Terminal.” (Robert Moses, memorandum to members of the New York City Planning Commission, early July 1944; quoted in Weekly Report, July 7, 1944.) Since 1940 Greyhound had been trying to win approval to expand its 34th Street terminal, which was in an area zoned for “retail use” (it was a half block from Macy’s and a

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block from Gimbels and Herald Square). Nearby streets suffered from severe traffic congestion, and its effort had been opposed by the City Planning Commission and the Police Department; the Board of Estimate had rejected its plan in 1941. Despite this setback, Greyhound bought a portion of the block in 1943 and hoped to win approval for expansion in the postwar years. In 1944, in discussions with the Port Authority, Greyhound said it would not bid for the commuter bus lines, but it would want the option to attract other long-haul buses. The Port Authority calculated that this traffic diversion would cost its union terminal about $100,000 annually in revenue, jeopardizing the self-support goal. (Port Authority, Weekly Reports, June, July, and November 1944.) 7. See Weekly Report, January 1945; Engineering News-Record, April 5, 1945, p. 431; and, on LaGuardia’s position, his letter to H. Cullman, March 8, 1945, reprinted in the Weekly Report, March 10, 1945, as well as discussion of LaGuardia’s actions in the Weekly Reports, January - April 1945, and New York Times, June 7, 1945. 8. LaGuardia’s comment is from his radio address on June 10, quoted in the New York Herald Tribune, June 11, 1945. The mayor also endorsed the Port Authority’s plans and criticized Greyhound for its failure to cooperate. In an earlier radio address, on May 20, LaGuardia had leveled a sharp attack on the company: “You know, some of these buses have bad habits. You know what I mean. They have always been able to kind of get the right connections—get it?—connections in many cities. . . . The Greyhound is one of them. . . . Greyhound always gets everything they want anywhere they go, but not in New York, Greyhound, not while I am mayor, you won’t.” On developments in these months, see Tobin’s Weekly Reports in May and June, 1945, and New York Times, Jan. 17, 1946. 9. See New York Herald Tribune, Oct. 26, 1945. Although the Board agreed to give the Planning Commission jurisdiction over bus terminal siting, it retained the right to overrule the Commission. 10. Letter from Moses to Howard Cullman, October 16, 1945; copy provided to the author by Moses in 1978. On Greyhound’s expansion plans, Moses’ support for its efforts, and LaGuardia’s continued opposition, see New York Herald Tribune, Oct. 19, 1945 and New York Times, Nov. 21, 1945. 11. This summary is taken from Herbert Kaufman’s interview with two Port Authority officials who were present at Tobin’s meeting with Moses; see confidential interview #4, March 24, 1950. The exact date of the meeting is not certain, but it probably occurred in the final weeks of 1945. 12. Interview with Herbert Kaufman, March 17, 1950. See also Caro, Power Broker, 1974, p. 759. 13. Caro’s conclusions on this point: “No evidence has been found of specific fees being given for specific favors. Moses did not operate by demanding direct qui pro quo’s. . . . In terms of money, the terms in which corruption is usually measured, Robert Moses was not himself corrupt. He was, in fact, as uninterested in obtaining payoffs for himself as any public servant who ever lived. In the politicians’ phrase, he was ‘money honest’ ” (Caro, 1974, p. 722). Some Port Authority officials believed otherwise. According to one senior staff member active in the bus-terminal campaign, Moses “went on Latin American junkets” paid for by Greyhound; this official had seen billing records for the trips, records which had

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also been given to the editorial board of the New York Times (author’s interview 222, March 11, 1986). On the allegation of inappropriate payments from private firms to Moses, see Kaufman’s interview with two senior Port Authority officials, March 1950; also, the author’s interview #203, May 1, 1984. Writing to his associates at the Port Authority in 1946, Tobin called attention to one part of this linkage: The proposal to bar bus-terminal expansion east of Eighth Avenue, he noted, had been “supported by Commissioner Moses . . . until Greyhound retained Madigan & Hyland in 1944” (Weekly Report, June 14, 1946). MadiganHyland was Moses’ favored engineering firm; see Caro, 1974, pp. 536 ff. 14. Quotations are from the recollections of a Port Authority staff member involved in these discussions (sent to the author Feb. 13, 1995). 15. See the editorials in the Herald Tribune, Jan. 9, 1946, the Times, Jan. 11 and 17, 1946, the Sun, Jan. 16, 1946, and the Bergen Evening Record, Feb. 20, March 5, 1946; also, Weekly Report, Jan. 12, 1946. 16. At the beginning of January, the Port Authority’s chairman met with Edwin Salmon, who headed the Planning Commission, and concluded that a favorable vote was likely by late February. (Tobin, Weekly Report, Jan. 5, 1946.) On O’Dwyer’s continued silence, see Herald Tribune, editorial, Jan. 9, 1946, New York Times, editorial, March 26, 1946. 17. Opposition in Albany was led by the New York Central Railroad and the Commerce and Industry Association, and at one point (Tobin reported to his board) it seemed possible that the Senate Committee on Finance would block the bill. Then James Danahy of the West Side Association of Commerce led a counterattack. Danahy personally agreed with the Port agency’s analysis of the traffic problem, and he got along well with Tobin, Jaffe, and the leaders of Manhattan’s other civic groups. He became the “self-appointed . . . whip, corralling all kinds of support for the PA among his wide circle.” The New York State Chamber of Commerce and other groups then sent messages urging favorable action, and the relevant committee chairs—Senator Arthur Wicks and Assemblyman Mallory Stephens—took leading roles in gaining approval of the bill. (New York Times, March 9, 1946; Weekly Report, Feb. 2, March 2, 9, 23, 1946; also, letter to the author, Jan. 26, 1995, from an official of a Manhattan civic group who was involved in these events.) 18. The leading opponent in Trenton was Senator Herbert Pascoe, who held a fulltime position with the Pennsylvania Railroad. Several Port Authority board members, who were influential in business and political circles in northern New Jersey, were active in the legislative campaign: “Commissioners Abell, Lowe, Armstrong and Byrne and former Commissioner Borg have all been making every effort to assure us the necessary eleven votes out of the remaining fifteen Senators who are not committed against us. Commissioners Abell and Lowe . . . have obtained [Governor Edge’s] assurances of support.” (See Newark News, April 3, 1946; Bergen Record, editorial, April 4, 1946; Weekly Report, April 1 and 6, 1946. The quoted material is from Tobin’s April 1 Weekly Report.) 19. “From the first,” Sayre and Kaufman comment, “he was seized by a habit of Hamlet-like introspection and indecision, oppressed by the dilemmas and complexities of his tasks. This pattern was varied by irregular bursts of vigor and decision, but, on the

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whole, he was more awed than energized by the office” (Sayre and Kaufman, Governing New York City, 1960, pp. 696–97). Relying on a firm and persuasive Robert Moses was an attractive option for such a man; having to turn away from the direction urged by Moses must have been painful. (O’Dwyer admired Moses as “a man who could get things done . . . with competence and decisiveness”; see the mayor’s autobiography, Beyond the Golden Door, 1987 [quotation on p. 253].) On developments in the spring of 1946, see Weekly Report, April 13; New York Herald Tribune, April 15, New York Times, April 20; Herald Tribune and The Sun (New York), both April 23; Jersey Observer (Hoboken), April 26. The “mystery” quote is from Robert Spivack, “Bus Terminal Row Flares Anew,” New York Post, April 23, 1946. 20. At a meeting of the Board of Estimate, O’Dwyer said that “when I made an inquiry into all this nonsense about Greyhound, I found the city was walking into a three-year lawsuit. The Planning Commission was planning to force out of business an enterprise that had been on the same location for seventeen years.” He viewed the midtown exclusion idea as “the whim of a former Mayor” and said he would not support the action without a new study of traffic congestion. (New York Herald Tribune, June 14, 1946.) The law-suit threat was one of Moses’ arguments for allowing Greyhound to expand; O’Dwyer’s comment that the midtown prohibition would force Greyhound to close its terminal was a new thought, thus far not presented by Greyhound itself. 21. Greyhound had made this congestion-reduction point earlier. The argument went like this: A larger terminal at 34th Street would permit the company to close its second terminal, at 50th Street; in addition, the expanded terminal would be designed for use only by long-haul bus companies, and the commuter buses which had been using the 34th Street station would transfer to the Port Authority’s terminal. This position did not address the considerable legal and political problems the city would face if it allowed one private company to expand in midtown and then tried to stop competing bus enterprises from expanding their own midtown terminals. (See the report, “Selected Measure for the Partial Relief of Traffic Congestion,” Dunn, Andrews, & Clark, Nov. 14, 1946; letter from Greyhound’s vice president, New York Times, Jan. 17, 1946; New York Herald Tribune, June 14, 27, 1946; Weekly Report, July 26, Oct. 11, 1946.) 22. See New York Times, Oct. 21, Nov. 15, 20, 1946. 23. The editorial in the World-Telegram appeared on May 3, the others on May 2. The Planning Commission’s May 1 vote was not well timed from the viewpoint of Moses and Greyhound. The day before, April 30, the Port Authority had celebrated its 25th Anniversary, and its “long record of service, efficiency, far-sighted intelligence and non-political administration” had been applauded on the editorial and opinion pages of a dozen daily newspapers in the region. Several essays commented on the need for the city to give a “green light” on the bus terminal, “this latest of its constructive proposals.” Thus the May 1 vote was taken at the time when it was, perhaps, most likely to be condemned. (Quotations just above are from the May 1 editorials in the New York Times and the New York Herald Tribune, respectively.) 24. New York World-Telegram, May 2, 1946. 25. World-Telegram, June 14, 1946; this editorial appeared after information on Grey-

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hound’s reported payment for a Moses trip to Latin America had been given to editorial writers (author’s interview 441, Sept. 14, 1984). For LaGuardia comment, see the New York newspaper PM, May 5, 1946. 26. See for example, editorials in the Herald Tribune, June 28, August 13, Nov. 15 and 17, 1946; New York Times, Oct. 16, Nov. 20 and Dec. 6, 1946; and New York Post, Nov. 15, 1946; also the Regional Plan Association’s report in June 1946. 27. The quotations are from editorials, respectively, in the New York World-Telegram, May 3, New York Herald Tribune, May 3 and May 10, 1946, and New York Post, May 2, 1946. 28. In July, 1946, the chairman of the City Airport Authority had resigned and urged O’Dwyer to turn the airports over to the Port Authority; in August the mayor had asked the bi-state agency to study the possibility of taking control of the airfields; and during the fall Tobin and his aides worked with city officials and carried out the study (See chapter 11). 29. See Weekly Report, Nov. 22, Dec. 13, Dec. 21, 1946. In mid-December one of Moses’ associates called Commissioner Eugene Moran of the bi-state agency board and asked to meet with him separately; but Moran invited Tobin to the meeting as well. At the meeting, it was suggested that Moran and Moses work out a plan which would give a large part of the Eighth Avenue terminal to Greyhound, in return for its agreement not to expand at 34th Street; the Moses-Moran proposal could then be taken to Mayor O’Dwyer for approval. Moran and Tobin rejected that stratagem. (A. J. Tobin to H. S. Cullman, memorandum on the Union Bus Terminal, Dec. 19, 1946.) 30. On O’Dwyer’s tactics, see The Sun (New York), editorial, Jan. 31, 1947, Bergen Record, Feb. 1, 1947. The resolution stated that “it is the policy of the Board of Estimate that it will not approve the erection of a new bus terminal, or the permanent enlargement or extension of an existing bus terminal, within the area . . . bounded by the west side of Eighth Avenue, the north side of Fifty-ninth Street, the east side of Lexington Avenue, and the south side of Twenty-second Street.” 31. Daily News (New York), Jan. 31, 1947. 32. New York Times, editorial, Jan. 31, Bergen Record, editorial, Feb. 1; and see New York World-Telegram, Jan. 31, New York Herald Tribune, Jan. 31, The Sun, Jan. 31, 1947 (all editorials). The praise for O’Dwyer in the Bergen daily is especially strong, and the text conveys a sense that Port Authority officials provided some of the information. The editor of the Bergen Record, John Borg, was a once and future Port Authority commissioner. 33. Early in the planning for the Eighth Avenue bus terminal, Greyhound had indicated a willingness to move to the Port Authority’s site, if it could build its own terminal on a substantial portion of the block. The Port Authority said it would need the entire block but that Greyhound could have partial control over gates for its buses. However, the Port agency would not permit Greyhound to have any concessions in the terminal, and Greyhound passengers and buses would be controlled by the Port agency’s general scheme for the huge building. (Calculating that more than 2,000 buses and 50,000 passengers would have to be moved in and out of the terminal each day, with large portions during commuting hours, the agency’s planners were certain that the system would work smoothly only if the allocation of buses to gates and other traffic-control matters were under unified control.) See Weekly Report, Jan. 20, 1945; A. J.

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Tobin, memorandum to H. S. Cullman, Dec. 19, 1946; Weekly Report, Nov. 21, 1953, Jan. 30, Oct. 23, 1954; and Port Authority, Bus Terminal files. 34. See chapters 4, 5 and 12 above. For a useful commentary on Greyhound’s perspective during the extended New York City battle, see “Greyhound Stirs,” Business Week, Feb. 10, 1951. 35. On these 1947 developments and those in 1948–53 summarized below, see the Port Authority, Annual Report, during those years, and the “Chronological Summary of Bus Terminal Situation in New York City,” submitted by the Port Authority at the hearing of the City Planning Commission, March 18, 1959. 36. New York Times, Jan. 14, 1950 (for the quote); see also New York Herald Tribune, Jan. 14, 24; New York World-Telegram and Sun, Jan 20, 31; Regional Plan Association, press release, Jan. 28; West Side Association, letter to New York City Comptroller, Jan. 31; Weekly Report, Jan. 28; and Port Authority, Annual Report for 1949, pp. 76, 80. 37. Weekly Report, March 4; New York Times, March 7; New York World-Telegram and Sun, March 7, 9; New York Herald Tribune and New York Times, March 9; New York Herald Tribune, March 11, 12; New York Times, March 29, April 1; Weekly Report, April 1; New York Herald Tribune, April 3; Weekly Report, May 6, 1950 (in which Tobin notes O’Dwyer’s “complete silence” during the extended conflict, regarding the bus-exclusion pledge which he and the other members of the Board of Estimate had made in 1947). In an era in which elected officials viewed news articles and editorials as the barometer of public opinion—and of likely public retribution—Moses and O’Dwyer no doubt paid close attention to this flurry of critical activity, particularly the March 7 WorldTelegram, which questioned how Greyhound and its affiliates “have been spending their money to keep the terminal project alive,” and suggested that Governor Dewey “should inquire into this unusual situation”; and the New York Times (March 9), which interpreted the city’s complex maneuvers under Mayor O’Dwyer as suggesting that the city’s pledged word might “henceforth be a laughing-stock,” if it did not adhere to the 1947 agreement. 38. Weekly Report, March 18, 1950; New York Herald Tribune, March 21, 1950. 39. New York Times, March 17, 18, 1950; Weekly Report, March 18, 1950. 40. New York Times, March 23, Oct. 18, 1950; Weekly Report, April 1, 22, 1950; R. C. Skehan, memorandum to A. J. Tobin, April 26, 1950; Port Authority, Annual Report for 1950, p. 101; see also Cleveland Rodgers, Robert Moses: Builder for Democracy (New York: Henry Holt, 1952), pp. 176–177. 41. See “Parking Body Asks New Wide Powers,” New York Times, Jan. 18, 1951 (also March 23, April 2); “More Lives Than a Cat,” editorial, New York World-Telegram and Sun, Jan. 10, 1951; “Sticking to a Promise,” editorial, New York Herald Tribune, Jan. 12, 1951; Weekly Report, Jan. 20, 1951 (which includes excerpts from the Moses memorandum); and Port Authority, Annual Report for 1950, April 30, 1951, pp. 101–102. The mayor was now Vincent Impelliteri, O’Dwyer having resigned in the fall of 1950 to become Ambassador to Mexico. Tobin’s continuing efforts to keep track of Moses’ tactics are illustrated by his note to several staff members as the 1951 legislative session got underway in Albany. “We must be most vigilant,” Tobin wrote, in finding out what amendments to the Parking Authority law

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were being considered. Two of his aides were asked to keep in touch with state legislative staff, so that the Port Authority could review any drafts Moses brought there; another was to tap into his own “Wall Street sources,” where Parking Authority amendments might become known, because of Wall Street’s important role in any garage financing the agency might later attempt; and Tobin asked that information be sought from the Comptroller’s office in Albany, in case the Moses team talked with experts there. (A. J. Tobin, Memorandum to W. Caughlan and others, Jan. 3, 1951; bus terminal files.) 42. See Weekly Report, Nov. 21, 1953, Jan. 30, Oct. 23, 1954; A. J. Tobin, file memoranda on Greyhound, May 6, 7, 1958; Port of New York Authority, press release, March 18, 1959; Weekly Report, August 12, Nov. 18, 1963. Some sense of the Port Authority’s strategy during these years can be obtained from Tobin’s telegram to chairman Howard Cullman during the 1958 Greyhound campaign for city approval: “Your cables to publishers most effective. Greyhound story in papers this morning also New York Times editorial staunchly supporting Port Authority, and Journal-American very favorable editorial. Expect other papers to give Port Authority full editorial support shortly. Six leading civic organizations to send Mayor letter today supporting Port Authority position. . . . Rumor [Greyhound] may have obtained Gimbel’s and Macy’s support. Have drafted cables from you to Bernie Gimbel and Jack Strauss. . . . Thanks for everything.—Austin Tobin” (May 16, 1958). 43. Caro, 1974, p. 921. 44. Caro mentions one other conflict during these years—an issue related to building the third tube for the Lincoln Tunnel—and counts it in Moses’ favor (Caro, 1974, pp. 921–922). The same episode is discussed in Cleveland Rodgers’ largely laudatory biography of Moses, where it is treated as a standoff, or as a partial Moses defeat (Rodgers, 1952, pp. 175–176). 45. In fact, the negotiating team was led by William Pallmé, whose earlier work with Tobin on condemnation is described in chapter 9 above. The Port Authority’s tactics are worth a brief mention. For example, the owner of one building testified that he had purchased the property for $31,000 and made improvements which justified a condemnation award of $40,000; the judge agreed that the Port Authority should pay him that total. However, Pallmé investigated and found that the actual purchase price was $13,000 and that most of the alleged improvements had not been made; the judge was persuaded to reduce the award by more than one-third. The energy with which the Port Authority sought to cut costs and squeeze profits from various nooks and crannies was also illustrated by other facets of the bus-terminal project. For instance, when the substation’s owner, Consolidated Edison, sold its property to the Authority, Tobin agreed to take control of 845 tons of old copper, brass, and other metals the company wished to leave behind. Based on its experience in 1944–46 in retiring other substations, Con Ed estimated the salvage value of the scrap at about $8,000. Port Authority engineers thought the market price should be much higher, then contracted with an expert to price and sell every item (his fee to be a percentage of the total), and sold the salvage at $140,000, with about $125,000 of that retained by the agency. (Weekly Report, April 24, Oct. 2, 1948.) 46. New York Herald Tribune, Nov. 8, 1947. 47. On the strategies used generally in highway-building and urban renewal, see

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Danielson and Doig, New York, 1982, chapters 8–9; Harold Kaplan, Urban Renewal Politics (New York: Columbia University Press, 1963); Susan S. Fainstein and others, Restructuring the City (New York: Longman, 1983), chapters 2, 3, 6 (experience in New Haven, Detroit, San Francisco); Paul Kantor, The Dependent City Revisited (Boulder, CO: Westview Press, 1995), chapter 6. 48. On the favorable attitude toward Moses in the press during these years, Robert Caro’s analysis is persuasive. See for example his comments on the New York Times, the Herald Tribune, and the Daily News; also, the more critical view of Moses found in the New York Post (Caro, 1974, pp. 966, 978–79 and passim). The awakening of a critical spirit in the news media in 1959 is described in Caro, 1974, pp. 1040 ff. 49. Information on Manhattantown is based on investigations carried out at the time by Lawrence Orton and the Women’s City Club, as summarized in Caro, 1974, pp. 962–978; text quotation on p. 973. On East Tremont, see Caro, 1974, pp. 850–884. 50. J. Clarence Davies, III, Neighborhood Groups and Urban Renewal (New York: Columbia University Press, 1966), p. 14. This book and Caro’s volume (especially Parts VIVII) describe the Moses strategy in detail. See also Danielson and Doig, 1982, pp. 311–314. 51. The discussion of the Port Authority’s approach in this section is drawn mainly from Terry L. Cooper and Jameson W. Doig, “Austin Tobin and Robert Moses: Power, Progress, and Individual Dignity,” in T. L. Cooper and N. D. Wright, eds., Exemplary Public Administrators (San Francisco: Jossey-Bass, 1992), pp. 122–125; see also A. J. Tobin, letter to Edward Yost, Aug. 30, 1949, author’s interviews with Lee K. Jaffe (May 22, 1984) and Douglas Tuomey (April 7, 1986), and letter to the author from John Wiley, June 16, 1991. 52. PM, May 7, 1948. For the quotations in the text, see author’s interviews with Lee Jaffe, May 22, 1984, and with Fred Glass, Feb. 28, 1986, p. 7; Glass was a senior staff member at the Port agency at the time. 53. These 1948 “rehousing” statutes allowed the Port Authority to construct, rehabilitate, and operate residential housing units for those who were living in any of its project areas; this power would expire in July 1951. The statutes identified this temporary activity as “an essential governmental function”; in contrast to its other projects, however, the Port Authority would be required to pay “the same taxes” on its apartments as would any “private corporation.” (Laws of New York, 1948, Ch. 534, sections 2, 8, 9; and Laws of New Jersey, 1948, Ch. 97, same sections.) 54. Douglas Tuomey, interview with the author, April 7, 1986. On the rehousing program and related issues, see Newark News, April 30, 1948; Weekly Report, May 8, June 19, July 13, Sept. 9, 25, Nov. 6, 1948; New York Times, Nov. 20, 1948; Austin J. Tobin, letter to Edward Yost, August 30, 1949 (the source of the text quote on “schools, churches . . . ”); Port Authority, Annual Report for 1948, p. 74; Bergen Record, Jan. 7, New York Herald Tribune, Jan. 16, New York Times, Jan. 28, and New York World-Telegram, Nov. 22, 1949; and Weekly Report, Jan. 1, June 4, Sept. 17, 29, 1949. 55. The Port Authority’s efforts in working with the tenants are described in Robert Rice, “A Reporter at Large: Every Place, They Tear the House Down,” New Yorker, April 17, 1954, pp. 91–107. Tuomey’s efforts are described at length and appeared to be strongly “tenant-oriented.”

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56. See opinion by Judge Eder, in Matter of Port of New York Authority (New York Law Journal, July 29, 1948). Tenant views are captured in Tom O’Connor, “Death Comes to an Ancient Slum,” PM, May 17, 1948; and see New York Times, Jan. 28, 1949. On the agency’s later relocation programs, see Rice, New Yorker, April 17, 1954, pp. 91–107; J. Anthony Panuch, “Relocation in New York City: Special Report to Mayor Wagner,” Dec. 15, 1959, pp. 27–28; and Cooper and Doig, 1992, pp. 124–125. The Port Authority’s policy was later applied in Bangkok, when the airport authority made plans to build a second airfield; see letter from John Wiley to the author, July 19, 1995. 57. As described in chapter 3, partial insulation from political favoritism was provided through the Port Authority’s formal leadership structure: Rather than a single department head who served at the pleasure of the governor or president, the Port Authority was headed by twelve commissioners, six from each state, all appointed for six-year overlapping terms. Its primary source of funding (from its own projects) also helped insulate the agency from political bargaining, since it did not have to undergo the close review by legislative appropriations committees required of regular departments before they received their annual budgetary allotments. On the tradition of favoritism in governmental action in the New York region, see Sayre and Kaufman, 1960, pp. 45–50; Warren Moscow, Politics in the Empire State (New York: Knopf, 1948), pp. 66, 116–117; Dayton D. McKean, Pressures on the Legislature of New Jersey (New York: Columbia University Press, 1938). The tradition is still with us, as suggested by more recent headlines: “State Pols Make Millions in Private Law Practice,” New York Post, March 10, 1986 (describing the payments to key Albany legislators, by their law-firm clients who also do business with state agencies), and “Contractors For Albany Contribute to Both Parties,” New York Times, Nov. 2, 1994 (on campaign donations to both gubernatorial candidates, by engineering firms with large state contracts). See also Frank Anechiarico and James Jacobs, The Pursuit of Absolute Integrity (Chicago: University of Chicago Press, 1996), ch. 6, 8. 58. John D. Foster, letter to the author, October 6, 1995. Carty once described his system to a close associate: “a clerical worker had a one-paper file (a letter from the district leader); a middle manager had a second letter in the file (a recommendation from a state legislator); and a department director had a third document (a letter from the governor).” Although “Joe’s story was overly simple,” his confidant later recalled, there was “some truth” to it. (Letter to the author from 502, Nov. 6, 1997.) 59. The Port Authority’s general personnel standards, quoted in the text, are found in its annual reports, beginning with Annual Report for 1945 (published July 1, 1946), p. 51. Foster’s recollections are taken from the author’s interview, March 10, 1995. Foster joined the Port Authority in the spring of 1948, and he then carried out a study of the strengths and weaknesses of its personnel policies. On the positive side, the training program for junior trainees was strong, promotion policy was based on objective performance, and there were safeguards to protect employees against arbitrary discipline. On the down side, standards for selecting employees for semi-skilled and lower jobs were very weak (“anyone who can make a minimum passing grade on a test” might be hired; no effort was made to determine whether the tests given actually measured factors relevant to the job; and past employment information was not checked); also, selection efforts at

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those levels were inefficient (even when there was no labor shortage, it might take “a month to fill a clerk’s job”); and training for supervisors was “non-existent.” With Tobin’s support, Foster took steps to remedy these weaknesses, and his work was highly regarded inside the agency and beyond. Foster served as Personnel Director from 1948 until 1964, when he left to become vice president for personnel at Montgomery Ward. (The summary of Foster’s early study, above, is taken from his 50-page report to Austin Tobin [untitled], August 1948; on loan from Foster.) 60. “What a Political Invention Did for N.Y.,” Business Week, July 14, 1956, p. 79; a picture of Tobin graces the cover. The earlier Tobin quotations are taken from his address to the Union League Club of Chicago, April 10, 1945 (the printed version, circulated to his staff and others in New York and New Jersey), p. 1; and his speech to the conference of comptrollers of New Jersey and New York, Feb. 10, 1953, p. 7. The 1945 Chicago speech, with its emphasis on keeping the agency “free of politics,” was distributed by Lee Jaffe’s team to the region’s newspapers and was the subject of admiring editorials; see the Hudson Dispatch, April 14, 1945 and Elizabeth Daily Journal, April 15, 1945. 61. Annmarie H. Walsh, The Public’s Business, 1978, p. 225. 62. The letters quoted above and in the next two paragraphs were made available by former Port Authority staff members and are in the author’s files. 63. See C. J. Kushell, Jr., Comptroller, memoranda to the file, Nov. 17, 1949, March 15, 1950; provided by Mr. Kushell and in the author’s files. The history of the “patronage” distribution of insurance commissions at the Port Authority is described in U. S. House of Representatives, Committee on the Judiciary, Port of New York Authority: Hearings before Subcommittee No. 5 (December 1–2, 1960), pp. 1168–1172, 1191–1197, 1448–1457 [hereafter, Celler Committee hearings, 1960]. 64. For example, as one important project got underway, a staff member recalls Tobin calling him in and saying, “It would be a great help if you could find a place on your staff for——,” a friend of an important political leader. “I said I could do that,” the staff member recalled years later, “but I then said, ‘It would cause me all sorts of trouble, making it difficult for me to fend off other requests I’m getting.’ ” “You’re right, Tobin responded, “forget that I asked” (author’s interview 501, Oct. 6, 1995). 65. Information on these three cases is contained in Howard Cullman, Statement for delivery before the House Judiciary Committee, press release, December 1, 1960; Celler’s letters are attached to the statement. (Celler was a leading member of the Judiciary Committee during those years, and in 1960 he did launch an investigation of the Port Authority. Cullman then released a statement which included discussion of these events of 1948–50. Celler denied threatening to launch an inquiry; New York Times, Dec. 2, 1960.) 66. See Weekly Report, Feb. 2, 9, Mar. 2, 9, 1946; Feb. 21, 1947. For a more complete list of relevant bills introduced by and legislation blocked by Stephens, see Celler Committee hearings, 1960, pp. 1185–1189. 67. See Celler Committee hearings, 1960, pp. 1448–1452. See also New York Times, Dec. 2, 1960, Newark News, Dec. 2, 1960. One senior Port Authority official later recalled that, at Tobin’s urging, he had “cajoled” the Port Authority’s main insurance broker “to give a little” to Stephens’ firm even though it did no work. That way, he explained, the

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payment “didn’t come from the Port Authority directly.” (Charles J. Kushell, Jr., interview with the author, April 3, 1986.) According to Robert Caro, Stephens also had a very active insurance account with Robert Moses. In 1943, he “began receiving Triborough insurance business,” and Stephens “continually pressed Moses . . . for more business, telling them frankly that the influence he was using on their behalf entitled him to it, and no matter how much he was given he was never satisfied.” (Caro, 1974, p. 719.) 68. The Port Authority planned to open the terminal by January 1, 1951. Since it would at once need to handle 2,000 buses a day and a flow of tens of thousands of travelers, the agency’s staff calculated that they needed a solid eight weeks beforehand to train the staff, check out the escalators, make trial runs of buses under congested conditions, and work out problems that arose, before the impatient throngs came through the doors. Hence the November 1 deadline. 69. Port of New York Authority, “Record of Events in Connection with the Award of the General Building Contract, Port Authority Bus Terminal, to the Turner Construction Company,” January 1950, pp. 2–4 and Exhibit 1. Unless otherwise indicated, the discussion of the contract award in the text is drawn from this document (hereafter “Record of Events”), which includes 41 pages of notes dictated by senior Port Authority staff, together with 14 exhibits totaling 36 pages. 70. “Record of Events,” Exhibit 3 (W. E. Jeffrey, memorandum to J. M. Kyle, Dec. 20, 1949). 71. “Record of Events,” pp. 4, 28. 72. “Record of Events,” p. 5, and Exhibit 6. The Engineering Board members expressed doubt that MCS would finish the job by November 1, particularly since they were planning to do no work with their own staff and had selected some subcontractors of low quality; the delays in other MCS jobs reinforced this concern. 73. “Record of Events,” pp. 6–10; quotation at 10. 74. “Record of Events,” pp. 10–14. The quoted phrases are from Kyle’s recollections, dictated on Dec. 18. (In Stephens’ biographical entries in Who’s Who, he designated his occupation as “banker,” and listed positions in insurance and real estate.) 75. “Record of Events,” p. 12. As one construction engineer with extensive experience in New York during the 1940s and 1950s commented, “some firms had a political aura,” and Merritt-Chapman & Scott was one of them. They tended to use “political buddies” to help them obtain contracts; but these political efforts had a downside, for they “put its professional reputation at risk.” (Interview 712 with the author, Feb. 9, 1993.) 76. “Record of Events,” pp. 14–17, which includes Tobin’s recollections, dictated that night (Dec. 15); also, exhibit 9. 77. “Record of Events,” pp. 20–22. 78. “Record of Events,” pp. 22–23. 79. “Record of Events,” pp. 24–27. Hedden’s description provides some insight into the general approach used by the Port Authority in planning and operating its terminals. More than 200 staff members would be involved in the training effort: the ventilation fans and ducts would be tested, and drills would be held to ensure prompt repairs in case of breakdowns; the dispatchers, who controlled assigning buses to berths, would operate with

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aid of a mimic electrical diagram which would show the location of all buses continuously, and this staff would need extensive practice. Actions needed if escalators malfunctioned would require drills, including mock rerouting of passengers and repair drills; and the baggage-handling system, switchboards, fire and telephone and other systems would need to be checked and rechecked for normal and emergency conditions. 80. “Record of Events,” pp. 28–29. 81. “Record of Events,” pp. 29–32. 82. This paragraph and the two following are drawn from Tobin’s summary, dictated late the same evening (December 16); see “Record of Events,” pp. 32–35. 83. “Record of Events,” pp. 36–38; from Tobin’s notes, dictated on Saturday. 84. Stephens had told Tobin that Turner’s offer had been “10% participation” for MCS, and that he (Stephens) and Walter Jones insisted on “25% participation.” Turner explained to Tobin that he had offered MCS 10 percent of the net profits from the Turner project, without doing any work, as a way to help the Port Authority get out of a difficult political situation. (See “Record of Events,” pp. 36–39.) Kyle told Tobin that in his estimate, Turner might clear $200,000 on the $9 million contract. 85. “Record of Events,” pp. 39–40. 86. Dewey’s counsel, Charles Breitel, later said that he could not recall what the contacts were between Stephens and Dewey on this issue. However, he viewed Mallory Stephens as very influential in the late 1940s, “a sufficiently powerful figure to exact ‘patronage.’ ” (Charles D. Breitel, counsel to Governor Dewey, 1943–1950, letter to the author, April 27, 1986.) 87. Tobin’s actions were described by the main Port Authority broker, with reluctant and partial agreement by Tobin, in Congressional testimony a decade later; see Celler Committee hearing, pp.1174–1189, 1453–1455, 1932–1935. 88. Port of New York Authority, press release, Dec. 30, 1949. The six-page release includes the minutes of the Dec. 29 meeting and summarizes the public reasons for awarding the contract to Turner rather than MCS: the importance of the completion date and the “chaos” for commuters that might occur if the building were not ready by the end of December; and Turner’s greater experience in constructing large office-type buildings in New York City. No mention was made of problems found in MCS work at Peekskill or elsewhere. 89. On January 10, Assemblyman Roman of New York City introduced a bill which called for “a thorough and complete investigation of the affairs of the Port of New York Authority” and noted that its “letting of contracts,” “fixing of toll charges” and “vast expenditures for consultation fees” had “caused widespread criticism.” On the same day, Assemblymen Lashin and Curry of New York City also introduced bills to inquire into the agency’s toll charges, properties, and activities. All met the fell embrace of Stephens’ Ways and Means Committee. (Copies of the three bills are in the Celler Committee hearings, pp. 1421–1423.) 90. See “A Doubtful Decision,” editorial, Engineering News-Record, Jan. 19, 1950, p. 25. On MCS lobbying, the Newark bidding, and ENR, see A. J. Tobin, letter to Commissioner E. F. Moran, Jan. 12, 1950, and Tobin, letter to Moran, Feb. 6, 1950 (in the author’s files). 91. Having disposed of several bills antagonistic to the Port agency in January (see note 89 above), Stephens introduced bills in February, with Port Authority support, to set up

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procedures for handling legal suits against the agency, and to strengthen its powers in controlling traffic at its bridges and tunnels, and he then guided them to approval in March and April. (Celler Committee hearings, 1960, pp. 1187, 1259.) On Van Alstyne’s support, see Tobin, letter to David Van Alstyne, Jr., Jan. 13, 1950 (author’s files). 92. The problem was exacerbated by a local rule which at the time applied uniquely to this trade: Under union and trade association guidelines, bricklayers were not permitted to work overtime on New York City jobs. Therefore, Turner had to appeal to the bricklayers’ union for assistance in “building up the gang,” an appeal that was successful. (The original bricklaying schedule minimized cost; the revised plan would cost more in the brick component, offset by possible savings in reduced subcontractor “dead time.”) The brick problem and the general strategy used by Turner are described in D.C. Andrews, “Close Organization Pays Off on Tough Building Schedule,” Engineering NewsRecord, Dec. 14, 1950, pp. 32–34, from which the discussion in the text is largely taken. See also Robert Marshall, interview with the author, March 10, 1993; Marshall was a Turner staff member, serving as assistant superintendent on the bus-terminal project, January–November, 1950, and as superintendent beginning in November 1950. 93. “Arrangements with tenants had not been [fully] worked out,” William Starr of the Port Authority engineering staff recalls, when the contract with Turner was signed. As tenant needs were worked out in later months, there was “a continuous flow of extra work” which Turner had to take on while trying to adhere to the target date. (William P. Starr, Jr., letter to the author, April 5, 1995.) 94. See New York Times, Nov. 2, 1950. Final work on the retail stores had to be completed, as well as the various drills and training efforts described above. Though primary credit properly goes to the Turner Company, its senior staff noted that the Port Authority’s contribution was not insignificant. Kyle was “very well qualified” to work with Turner in solving engineering and other problems, recalled senior Turner official Robert Marshall; and he had the “wise insight” to bring in his own consultant—Frank Carey—who handled the coordination between Turner’s people and those at the Port Authority who understood how the bus terminal had to function. As a result, changes could be discussed with “clear understanding on all sides” and decisions could be made quickly. “It was an unusually good experience, working with the PA staff, for they were knowledgeable and ready to work out ways to save time” without sacrificing quality. (Robert Marshall, interviews with the author, March 10, 1993 and April 4, 1995.) 95. “Mayor Bars Buses Loading in Street; Terminal Hailed,” New York Times, July 13, 1950. 96. Information in this and the following paragraph is drawn from the Port Authority’s annual reports for 1950, 1951 and 1952; New York Times, Dec. 14, 1950; Newark News, Dec. 14, 1950; New York Herald Tribune, Dec. 15, 1950. 97. “Some [pipes] are filled with anti-freeze and some are heated by New York Steam,” explained Lee C. Webb, superintendent of the terminal. He also noted that thermostats had to be installed to prevent the temperature from rising more than ten degrees each hour, since a faster warming might crack the concrete. (“Big Terminal,” The New Yorker, Dec. 1, 1951.)

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98. Mumford, “The Sky Line: Masterpiece of Mediocrity,” The New Yorker, March 10, 1951, p. 85; New York Herald Tribune, editorial, Nov. 3, 1950. 99. “All this proves that through the medium of inter-state cooperation,” Driscoll said, “we may meet many of the needs of our great metropolitan areas. . . . I like to believe that this Bus Terminal may serve as a precedent which, if followed, may help to relieve our hard-pressed legislatures in Washington of some of the duties that they have unfortunately assumed in the past, and which they should turn back to the States and to the Cities.” (Governor Alfred E. Driscoll, transcript of his speech at the Dedication of the Port Authority Bus Terminal, Dec. 14, 1950 [PA library, Doc. 50–1037; punctuation modified].) The quotation from Dewey is also taken from the dedication booklet. 100. Editorial, New York Herald Tribune, Dec. 15, 1950; editorial, New York Times, Dec. 14, 1950 (“the terminal is a magnificent job; its architectural lines are clean and striking”). The World-Telegram and Sun found the bus terminal “a fitting gateway to the city,” comparable to Grand Central Station (Dec. 15, 1950); and to the Elizabeth Daily Journal (Dec. 14, 1950), the new terminal was “a bit of utopia,” a “passenger palace.” 101. Joseph Heller, Closing Time (New York: Simon & Schuster, 1994), pp. 415, 432. 102. New York Times, Dec. 16, 1950 (on the cake); “Big Terminal,” The New Yorker, Dec. 1, 1951 (on the bowling). 103. New York Times, Dec. 16, 1950. 104. Stephen K. Bailey, “Ethics and the Public Service,” 1964, as reprinted in W. L. Richter, F. Burke and J. W. Doig, eds., Combating Corruption/Encouraging Ethics (Washington, D.C.: American Society for Public Administration, 1990), p. 46. 105. On Dewey’s views, see Smith, Thomas E. Dewey and His Times, 1982, esp. pp. 30–31, 38 ff. During the Tobin years, the Port Authority on occasion used another strategy to overcome political pressures in awarding contracts: doing the project with their own staff. A senior official recalled one case, involving a large contract in the 1960s at Newark Airport. The agency was preparing to advertise and receive bids, but the staff found itself under great pressure to award a major contract to a firm with strong political connections. To avoid having to acquiesce or fight these pressures, they used their own people instead. (Letter to the author from interview source 501, July 19, 1995.) 106. Bailey, pp. 50–52. 107. “Without the leavening of optimistic civil servants,” Bailey argues, government “becomes a cynical game of manipulation, personal aggrandizement, and parasitic security” (Bailey, p. 50). On the optimistic outlook on life, compare John Dewey, Reconstruction in Philosophy, 1920, pp. 48–49, quoted in part in the headnote of chapter 11 above. 108. As Link and McCormick argue, the progressives had a “faith in progress—in mankind’s ability, through purposeful action, to improve the environment and the conditions of life.” (Link and McCormick, Progressivism, 1983, p. 21; and see pp. 22–25, 113–116.) 109. “The division of operating responsibility . . . has not worked out,” the Port Authority reported in 1952, referring to the New York terminal. “Practices by the tenant carriers . . . have made the early operations uneconomic and unsatisfactory.” (Port of New York Authority, Annual Report, August 1, 1952, pp. 95–96.) In 1953, a private company took over the New York operation, and when the Air Force lease in Newark expired in 1955,

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Tobin and his aides leased the Newark building to a consortium of private truckers. (Port Authority, Annual Report, February 1956, pp. 34–35.) Reflecting on the failure of the Port Authority’s rail-terminal ideas in the 1920s and the truck-terminal schemes in the 1940s, a long-time observer commented: “In neither case did our planners understand the resistance of private enterprise carriers to governmentimposed solutions which involved their giving up their private terminals, where they could control the customer service, and using joint terminals where they couldn’t.” (Clifford B. O’Hara, Pennsylvania Railroad staff member in the 1940s and Port Authority official in later decades; letter to the author, Nov. 24, 1997.) 110. These developments in New York and Hoboken are described in the Port Authority’s annual reports for 1947 (pp. 35–36), 1948 (pp. 54–68), 1949 (pp. 67–71), 1952 (pp. 16–18). Years later, Robert F. Wagner, who was Manhattan Borough president in those years and then mayor of New York City, could still evoke his own fierce opposition to a Port Authority takeover of the city’s waterfront, based in part on the crucial role of the waterfront in the city’s history. Also, as he recalled, “the piers were making money; why don’t they take over the Sanitation Department instead?” (interview with the author, June 27, 1984). 111. Both Tobin and his director of marine terminals, Lyle King, had been frustrated by New York City’s unwillingness to turn over its extensive terminal system to their agency; in 1949–50 they saw it as the centerpiece of economic development in the harbor region. By 1956, they had joined forces with an innovative trucking executive and were developing plans to devise the nation’s first system for lifting truck chassis onto ships at Port Newark. (See discussion in the Epilogue, below.) 112. Schumpeter, The Theory of Economic Development, 1934, p. 93. 113. Robert Rice, New Yorker, April 17, 1954, pp. 91–107.

Chapter 14 1. The growth of the agency and its importance by 1950 can be suggested by some summary figures, shown in the table below. 2. Also in Link, The Papers of Woodrow Wilson, vol. 5, pp. 370, 371. 3. For more extended discussion of the Progressive legacy in the 1920s and later decades, see J. W. Doig, “Progressivism as Regional Planning: The Politics of Efficiency at the Port of New York” in Studies in American Political Development, 7 (Fall 1993), pp. 316–320, 369–370, and sources cited there. The Progressive themes cited in the text above are partly distinct from the “social justice” and “direct democracy” facets of Progressivism (see ibid., p. 317). 4. Link, Papers, vol. 5, pp. 379–380; emphasis in the original. 5. The quotation is from Louis Brandeis, in New State Ice Co. v. Liebmann, 285 U.S. 262, 311 (1932) (Justice Brandeis dissenting). 6. See chapters 9, 10, 12 and 13 above. 7. United States v. Lopez, 1995 U.S. Lexis 3039, 58 (1995), Justice Kennedy concurring. See also David Osborne, Laboratories of Democracy (Cambridge: Harvard Business School Press, 1988).

GROWTH OF THE PORT OF NEW YORK AUTHORITY TO 1950 Bonds outstanding Gross operating revenue Net revenue Number of employees

1930 $142 million $7.3 million $3.6 million 950

1940 $185 million $17 million $6.4 million 1,110

1950 $248 million $42 million $15 million 3,180

PA facilities (year opened or acquired) traffic per yr / gross operating rev. per yr. Bridges & tunnels S.I. bridges (1927) 1.3m vehicles/$0.8m 1.7m veh/$0.8m 6.0m veh/$2.6m (1940 & 1950 totals include Bayonne Bridge [1931] plus Goethals & Outerbridge) George Washington Bridge --8.5m veh/$4.9m 19.9m veh/$10.4m Holland Tunnel 12.1m veh/ $6.6m 13.3m veh/$7.5m 18.1m veh/$10.5m Lincoln Tunnel --3.9m veh/$2.4m 15.5m veh/$9.2m Airports (date acquired)[passengers & cargo/yr; planes arriving & departing] Newark Airport (1947) ----LaGuardia Airport (1947) ----Idlewild (NY Intl; JFK) (1947) -----

916,000/ 101m lbs; 66,000 3.5m /87m lbs; 135,000 380,000/14m lbs; 15,000

Other terminals PA Grain Terminal (1944) Port Newark (1947) Inland Freight Terminal (1932) [rental income] New York Truck Terminal (1949) [revenue tons] Newark Truck Terminal (1950) Manhattan Bus Terminal (1950)

[op. rev.] $981,000 $984,000 $1.7m 112,000 -----

-------------

----$1.3m -------

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8. See Walsh, The Public’s Business, 1978, chapters 1, 2 and 7; and other references cited in chapter 1. The influence of the Port Authority as a “model” is suggested by the flurry of editorials and public discussions in the early postwar years, particularly once the agency began to modernize the airports and Newark seaport and showed that it could plan and carry out the bus-terminal project. See for example this selection from the year 1950: “A Necessary Instrument,” editorial, Newark Star-Ledger, Jan. 14 (urging that the states “ponder the need for more such agencies to deal with the baffling business problems that our municipalities are incapable of managing”); “Jersey Turns to ‘Authorities,’” Newark News, Jan. 30 (summarizing the state’s recent creation of the Turnpike Authority and plans to create state authorities for water supply and housing); “Aggressive Agency to Promote Port Urged on Planners,” Buffalo Evening News, Feb. 2 (reporting on Austin Tobin’s speech in Buffalo, where he urged that its leaders consider creating a similar “aggressive and effective tool of modern government”; a bill was introduced in Albany that spring, and a port authority for the Buffalo region was created a few years later); “The Port of New York Authority,” editorial, Cincinnati Times-Star, Feb. 7 (commenting on its many activities and “wise management” and suggesting that Cincinnati should consider a similar regional agency to operate its airport and other “desirable developments”); “Delaware PA Okd in Senate,” Newark News, April 11 (on creation of a Pennsylvania-New Jersey port authority); and “Airport Men Hear Finance Advice,” Plain Dealer (Cleveland), April 25 (reporting on an address to the AOC which urged that independent authorities be created to finance and operate the nation’s airports). 9. Samuel P. Hays’s argument is in his Conservation and the Gospel of Efficiency, 1969, p. vii. For a similar argument on the international scene, see Bruce Rich, Mortgaging the Earth (Boston: Beacon Press, 1994). 10. James Q. Wilson, Bureaucracy (New York: Basic Books, 1989), p. 115. In the indented quote above, emphasis in the original. 11. See chapters 1 and 3 above. 12. See Dennis C. Muniak, “Economic Development, Political Conflict, and the Creation of the Metropolitan Washington Airports Authority,” in Mitchell, ed., Public Authorities and Public Policy, 1992, pp. 99–117; report of the National Performance Review, Sept. 1993, recommending creation of a federal aviation corporation (financed directly by user fees) and “F.A.A. to Streamline Rules That Gave it Obsolescence,” New York Times, March 29, 1996; and “Giuliani to Propose New Agency . . . ,” New York Times, May 3, 1996. 13. Wilson, 1989, pp. 122–125; quotation on p. 125 (emphasis added). 14. See Erie, “How the Urban West Was Won,” Urban Affairs Quarterly, June 1992 (on the Los Angeles region); Boschken, Strategic Design and Organizational Change, 1988 (on West Coast agencies); Dorothy Nelkin, Jetport, 1970 (Boston’s Massport); Dennis Muniak, “Federal Divestiture, Regional Growth, and the Political Economy of Public Authority Creation,” Policy Studies Journal, 1990 (on the new Washington-Virginia regional authority); and Hargrove, Prisoners of Myth, 1994 (on TVA). In public health, see for example the essays on Beverlee Myers, Harvey Wiley, and C. Everett Koop in Cooper and Wright, eds., Exemplary Public Administrators, 1992. The activities of Webb, Rickover, Hanks, Cohen and Ball are analyzed in Doig and Hargrove, eds., Leadership and Innovation, 1987, chapters 4, 6, 7 and 8.

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15. Wilson, 1989, p. 225. 16. See chapters 6 and 13 above. 17. See Wilson, 1989, chapter 12. 18. Wilson, 1989, p. 217. 19. On Hoover, see Eugene Lewis, Public Entrepreneurship (Bloomington: Indiana University Press, 1980); on Moses, see Caro, Power Broker, 1974, as well as chapters 12 and 13 above. 20. On public authorities, see Walsh, 1978, chapters 2 and 11, and other sources cited above in Chapter One. On the authority’s close cousin, the federal corporation, see Ronald C. Moe, “Government Corporations and the Erosion of Accountability,” Public Administration Review (Nov. 1979), pp. 566–571. On the general problem, see for example Pendleton Herring, Public Administration and the Public Interest, 1936, Frederick Mosher, Democracy and the Public Service, 1968, and Herbert Kaufman, The Administrative Behavior of Federal Bureau Chiefs, 1981. 21. “The Port Authority,” editorial, New York Times, Jan. 12, 1950. 22. Guy Savino, “PA, at Financial Peak, Faces Attacks,” Newark News, Jan. 15, 1950. Savino wrote several hundred articles on the agency, during the three decades beginning in the 1930s. The Port Authority kept a special file which allowed them to track and retrieve his articles on any subject readily, in the pre-computer era. 23. “Air the Port Authority,” editorial, Daily Mirror (New York City), Jan. 12. 1950. This essay, and those by Savino and the Times, were prompted by public statements by legislators (following the criticisms of the bus-terminal contracts), that wide-ranging investigations of the bi-state agency were needed. Those calls soon faded into the legislative woodwork, for the reasons discussed in chapter 13. 24. For the text quotations, see Philip Selznick, The Moral Commonwealth: Social Theory and the Promise of Community (Berkeley: University of California Press, 1992), pp. 342, 344. My discussion of Selznick’s argument is based mainly on pp. 334–352 of this book. On the tendency to frame goals narrowly, Selznick uses the Tennessee Valley Authority to illustrate the problem. Created with a mission that included agriculture, forestry, recreation and conservation, in addition to building dams and generating electricity, TVA in time evolved into a “giant public utility company with very limited perspectives beyond the production and distribution of cheap electricity.” Whether to build a steam plant or a nuclear plant to generate power was then defined as a technical and economic question, and its leaders rejected criticisms that attempted to bring in “values, interests, and perspectives beyond those of engineering and economic analysis.” (Ibid., pp. 341–342.) 25. See ibid., pp. 320–321, 344–345, for the quotations (emphasis in the original), and 350–352. See also Selznick, Leadership in Administration, 1957, pp. 61–63, 137–147. 26. See J. Patrick Dobel, “Integrity in the Public Service,” Public Administration Review (May/June 1990), pp. 354–366; text quotation at 354. See also Dobel, “Personal Responsibility and Public Integrity,” Michigan Law Review (May 1988), pp. 1450–1465, and Dobel, Compromise and Political Action: Political Morality in Liberal and Democratic Life (Lanham, MD: Rowman and Littlefield, 1989). For a related argument, see Mark H. Moore, Creating Public Value (Cambridge: Harvard University Press, 1995), pp. 294 ff.

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27. For a detailed statement of this perspective, see Theodore Lowi, The End of Liberalism (New York: Norton, 1969). 28. Under this model, government executives or other officials “may not impute to others or to institutional structures the full responsibility for actions they perform and outcomes to which they contribute. No rules or strict orders totally exonerate them from outcomes to which they contribute and which they judge as immoral, illegal, or wasteful” (ibid., p. 358). To avoid too much reliance on one’s personal values, Dobel argues that officials should first set their course based on “law, then principles behind the law.” Strongly held personal values serve as “background conditions” for critical evaluation, not as “foreground directives for action.” They are “circuit breakers for judging actions which seem to violate central moral commitments” (ibid., p. 360). 29. Ibid., p. 361. 30. As I suggested in chapter 1, disciplined oversight entails active monitoring by elected officials to ensure that “independent” agencies are acting in ways that are consistent with the elected officers’ broad policy goals, while resisting the use of this oversight power to extract patronage or in other ways that cannot be defended publicly as strengthening the quality of governmental action. 31. These campaigns are described in chapters 9, 10 and 12. 32. See Danielson and Doig, New York, chapter 10. 33. See chapter 11. The key staff losses were Mortimer Edelstein and Marion Sanders. 34. Gertrude Himmelfarb, The New History and the Old (Cambridge: Harvard University Press, 1987), p. 20.

Epilogue 1. Schumpeter, The Theory of Economic Development, 1934, p. 93. 2. On negotiations with New York City officials and at Hoboken, see Port of New York Authority, annual reports for 1947 (pp. 35–36), 1948 (pp. 54–68), 1949 (pp. 70–71), 1952 (pp. 16–18), and 1955 (pp. 2–7). Still seeking a foothold on the New York side, the Port Authority purchased two miles of private docks on the Brooklyn waterfront in the mid-1950s. 3. Port of New York Authority, annual report for 1955, p. 8. Meyner, a Democrat, had been elected in the fall of 1953 to succeed Governor Driscoll, who had served two terms, the maximum permitted under the New Jersey constitution. 4. On the early evolution and ultimate success of containerization, see Roger H. Gilman, “Views of Port Industry,” Journal of the Waterways, Harbors and Coastal Engineering Division, Proceedings of the American Society of Civil Engineers, 97 (February 1971), pp. 1–18; Boschken, Strategic Design and Organizational Change, 1988, esp. pp. 29–31, 42–48; and Clifford B. O’Hara, “The Port Authority and the ‘Container Revolution’: Reflections on the 40th Anniversary of Containership Service,” March 1996 (author’s files). See also William Leech, Country of Exiles (New York: Pantheon, 1999), chapter 2. Writings on the “container revolution” at times place its origins in the mid-1960s, when frequent service between Newark and the major West Coast and European ports began. However, by 1960 the Elizabeth/Port Newark complex handled 1.1 million tons in

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containerized cargo, one third of the total freight at the combined ports, and the Port Authority predicted that, in this “rapidly expanding container ship age,” half of all Elizabeth traffic would in time be handled by container ships (annual report for 1959, p. 18). By 1965, containerized cargo at that port reached 1.9 million tons, 40% of the combined total; and in 1970, containerized tonnage had jumped to more than 6 million tons, nearly 2/3 of the total at Elizabeth/Newark. For the earliest beginnings, see Austin Tobin, Weekly Report to the Commissioners, March 13, 1954, pp. 15–16, June 19, 1954, pp. 19–20, and October 27, 1956 (Port Authority files); Port Authority, annual report for 1956, p. 18; also Port Authority of NY&NJ, Via Port of New York-New Jersey, April 1986, pp. 40–47, and Oliver E. Allen, “The Man Who Put Boxes on Ships,” Audacity: the Magazine of Business Experience, vol. 2 (Spring 1994), pp.13–23, a biographical essay on Malcom McLean. [Malcom is correct spelling.] 5. As described in chapters 12 and 13, that conflict mainly involved two projects in the 1940s—Tobin’s successful effort to gain control of the region’s major airports, despite Moses’ resistance; and the battles over plans for the Manhattan bus terminal. 6. These had included, in the 1920s and 1930s, the Port Authority’s three bridges between New Jersey and Staten Island, and the George Washington Bridge, together with the Triborough Authority’s Henry Hudson, Triborough and Bronx-Whitestone spans. 7. Caro, Power Broker, 1974, p. 921. 8. See Caro, 1974, pp. 721–725, 740. The “money men,” Howard Cullman, Sloan Colt and Bayard Pope, were Port Authority commissioners in the 1950s. 9. See Austin Tobin, Weekly Report to the Commissioners, 1953–54; author’s interviews with R. H. Gilman, 1986–1991, and with E. S. Olcott, 1986–1990; letter from Gilman to the author, May 16, 1988; letter from Edward S. Olcott to the author, July 16, 1990. (Gilman served on the planning staff beginning in the 1930s, and was head of the Planning Department from 1953 until 1975; Olcott joined the Port Authority in 1949, was an engineer and planner on Joint-Studies projects, and in 1975 succeeded Gilman as planning chief.) The discussion below draws on the author’s “Regional Conflict in the Metropolis,” Urban Studies, 1990, pp. 201–232. 10. In the late 1940s, Moses had persuaded some New York officials that elevated expressways should be constructed to carry traffic across Manhattan; one would break through the cluster of skyscraper office buildings around 30th Street, and the other would cut a swath in the densely developed area between the Holland Tunnel and the East River bridges. See Caro, 1974, pp. 769–770. 11. Tobin, Weekly Report to the Commissioners, Feb. 28, 1953. 12. Tobin, Weekly Report to the Commissioners, Nov. 11, 1953; interview with R. Gilman, Dec. 20, 1985. 13. See Port of New York Authority & Triborough Bridge and Tunnel Authority, Joint Study of Arterial Facilities, New York-New Jersey Metropolitan Area, January 1995. Toward the back of the report (pp. 51–57), Moses’ proposals for expressways through the heart of Manhattan are also described; in contrast to the circumferential arterials, these Manhattan plans would never leave the drawing board. Before the Joint Study was released, an event took place that suggested Moses’ strong interest in shaping the historical record. Sick and at home in early December 1954, Moses

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called publisher William Randolph Hearst to his bedside and—breaking the agreement with the Port Authority to withhold their joint plans from the press until January—laid out the entire scheme to Hearst, emphasizing that it was very much his idea, his plan. His story-telling abilities may have been equally evident when he described the arterial studies to Caro two decades later. (See Hearst, “To Speed Traffic Through City: Main Points in Moses Plan,” New York Journal American, December 10, 1954.) 14. Danielson and Doig, New York, 1982, pp. 200–204; J. Doig, “Spans,” Seaport: New York’s History Magazine, 33 (Summer 1998), pp. 16–17. 15. The fact that a facility or program area had operated in the red historically was no bar to action, as the Port Authority’s airport initiatives demonstrated. In that field, the agency’s entrepreneurs could see ways—by adding shops and increasing landing fees—to turn air terminals into break-even operations. However, rail transit lines, even in the years before the massive postwar highway expansion, seemed very unlikely to reach that goal. See Port of New York Authority, “Suburban Transit for Northern New Jersey,” March 1937; Tobin, Weekly Report to the Commissioners, November 28, 1947; “Port Authority Studies of the Rapid Transit Problem,” 1969, pp. 4–5. 16. The Port Authority was viewed as a cause of the rail transit problem because its bridges and tunnels, as key elements in the expanding highway network, encouraged commuters and other rail travelers to shift to automobiles and buses. The 1955 Port Authority-Moses report on arterial highways fueled this criticism, since the report explicitly rejected the need for rail tracks on the new deck of the George Washington Bridge and on the other bridges (Joint Study, pp. 8, 30, and 40). On the complex set of factors that led to the decline in rail commuting, and the political pressures on the Port Authority in the early 1950s, see J. W. Doig, Metropolitan Transportation Politics and the New York Region (New York: Columbia University Press, 1966), pp. 17–27, 47–60. 17. On the transit study, the Port Authority’s role, and legislative activities, see Doig, 1966, chapters 4–8; the Tobin quotation is on p. 187. The bi-state transit district would have included the ten New Jersey counties closest to New York City, plus two suburban New York counties, and New York City’s five counties. The district bill was passed in both houses of the New York legislature and in New Jersey’s state senate, but it was defeated in the New Jersey state assembly. 18. Either governor could veto any action by the Port Authority’s board. By threatening to use this power to disallow an airport construction contract, for example, a governor could block needed improvements until the Authority’s board agreed to the governor’s demands in another field, such as rail transit. Of course, the use of the veto power in this way carried political risks for the governor, as well as political benefits. The pressures on the governors were heightened by a 1958 federal law which made it easier for rail corporations to curtail passenger service, despite objections from state regulators. By December, 1958, the Pennsylvania, Lackawanna and Erie railroads announced they would soon reduce or eliminate passenger service, unless large public subsidies were provided. On these events and the state responses in 1958–59, see Doig, 1966, chapter 9. 19. That total included $100 million for the New York subways, plus deficit estimates for the New Jersey rail lines, the Long Island Rail Road, and the commuter lines running into Manhattan from Westchester County and Connecticut. Perhaps the Port Authority

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would not be compelled to try to meet all these needs; on the other hand, once the wall was breached, it was not clear that the agency would be left with any sizeable funds for use in other areas. 20. As Robert Fishman, a close student of regional issues, observes: “In the best of all possible worlds, the PA should have taken the lead in putting together a broad coalition to sponsor concerted action at the local, state, and federal levels for a balanced transportation system—taking the lead by committing a substantial portion of its own revenues and then encouraging the other units to accept their share of revenue raising. That would have been the truly Progressive response” (letter to the author, August 22, 1998). The political history of the transit district, discussed in the text above, suggests that such a coalition might have gained substantial support on the New York side of the region while facing far greater obstacles in New Jersey, where there was no tradition of using tax revenues to subsidize mass transit. It is worth noting that the Port Authority’s activities and potential actions on the railtransit issue were motivated not only by the political pressures it faced to “do something.” As guardians of the area’s economic health, its staff realized that a reliable commuter rail system was essential to the region’s continued economic strength. Moreover, the collapse of any portion of the rail service would add to truck and auto congestion at the Lincoln and Holland tunnels, increasing pressure on the agency to build additional vehicular tubes to Manhattan; but any additional tubes would only be needed for a few hours each day, and would generate financial deficits for the Authority, as well as adding further to vehicular congestion in Manhattan. 21. R. H. Gilman, memorandum to A. J. Tobin, Feb. 28, 1955 (in A. J. Tobin files: Port Promotion, Port Authority of NY&NJ); author’s interview with Roger Gilman, April 3, 1986. On the origin and evolution of the project, see Anthony Robins, The World Trade Center (Englewood, FL: Pineapple Press, 1987), and a detailed set of reflections by Clifford O’Hara, “The World Trade Center,” November 1994 (13 pp.) in author’s files. 22. Downtown-Lower Manhattan Association, Lower Manhattan: Recommended Land Use, Oct. 14, 1958, pp. 6, 26–27, 38–39; Gilman memorandum to Tobin, Port Promotion files, Sept. 24, 1958. 23. See “Proposed Development of World Trade Center,” Nov. 17, 1959 (in Port Promotion—Tobin files); Downtown-Lower Manhattan Association, World Trade Center, January 1960; Port of New York Authority, A World Trade Center, March 10, 1961. The next several pages draw upon the author’s analysis in “Austin Tobin and the Port of New York Authority,” in Doig and Hargrove, eds., Leadership and Innovation, 1987, pp. 160–166, and Doig, 1966, pp. 215–221. See also Al Frank, “A Towering Asset for the Port Authority,” Newark Star-Ledger, March 31, 1991. 24. Goldberg, who had labored in the halls of the Port Authority’s legal department since his key role as a Tobin aide in the 1930s bond fight (chapters 9–10 above), suggested that future bonds sold by the Port Authority include a covenant which formally guaranteed that the Port agency would not have its reserves drained away by rail projects, thus jeopardizing its ability to repay the bondholders. In the final agreement, this “statutory fence” limited the agency to the H&M, plus other rail activities only if the total annual deficits from all rail operations did not exceed

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10 percent of the agency’s General Reserve Fund. The agency estimated that this formula would allow it to take on projects with a total rail deficit of $7–10 million; at least $5 million of that total would likely come from the H&M alone. Meanwhile, the planning staff under Edward Olcott, Gilman’s deputy, had analyzed the engineering and other problems on the decrepit railroad and drawn up estimates of the funds needed to make the rail line a reliable system; that total was $83 million. (See Austin J. Tobin, statement before the New Jersey Senate Commission to Study the Financial Structure and Operation of the Port of New York Authority, Public Hearing, Sept. 27, 1960; Port Authority, annual report for 1960 [pub. Spring 1961], pp. 45–47.) 25. Port Authority, annual report for 1961, pp. 30–33; annual report for 1962, pp. 32–42; interviews with Roger Gilman, 1988–89; interview with Richard J. Hughes, May 9, 1986. (Hughes was governor of New Jersey, 1962–1970, following Meyner’s two terms as the state’s chief executive.) 26. “The World Trade Center,” editorial, January 20, 1964. The “gleaming metal” quotation is from Port of New York Authority, annual report for 1963 (published in 1964), p. 41. On the evolving size of the project, the selection of the architect, and the design of the towers, see Robins, 1987, pp. 20–41. The suggestion that the towers rise higher than the Empire State Building probably came from Lee Jaffe and Warren Goodman of the Public Affairs Department; see Robins, 1987, pp. 40–41, and Richard Sullivan, memorandum to the author, Aug. 22, 1998. 27. As Edward Kresky, an adviser to Nelson Rockefeller during his years as governor, recalls, “Nelson told Tobin that the trade center buildings had to be dramatic”; but as planning for the center went forward Rockefeller had no idea what the plans were, until he was asked to view a model at the Authority’s conference room early in 1964. Before the model was unveiled, Rockefeller and Kresky talked informally with the architect, Minoru Yamasaki, who described the center’s buildings as 110 stories, with thin window openings to conserve energy. “You say 110 stories,” Nelson commented, “is that two buildings with 55 stories each?” “Oh no,” replied Yamasaki, “110 stories a piece!” Rockefeller turned to the side and noted soto voce to Kresky that his brother David’s Chase Manhattan building, the tallest in lower Manhattan, was less than 70 stories. “My god,” he exclaimed, “these towers will make David’s building look like an out-house!” (Interviews with Edward Kresky, Feb. 28, 1986, p. 8; April 2, 1986, p. 1.) 28. As one high official recalled, “When I saw the model, I was so depressed. The political issue would be terrible. I said to Austin, ‘This is big trouble!,’ but he responded, ‘I think it’s beautiful and the commissioners like it.’ ” “The airport project was going nowhere,” another staff member pointed out, “and something big was needed to head off a payout [to the states].” (See interviews with Rosaleen Skehan Tobin, Nov. 1, 1984, June 27, 1991, and letters from two Port Authority staff officials with many years working in international trade [Jan. 30, 1992, and Feb. 10, 1992].) 29. “Questions on the Trade Center,” editorial, Dec. 24, 1966; “Reviewing the Trade Center,” editorial, April 12, 1967. In the 1990s, defenders of the trade center could argue that ultimately the project did contribute to the revitalization of lower Manhattan; however, analyzing the impact of the project is complex, and a similar (or more positive) result might have been achieved with a more modest plan. For a thoughtful and detailed

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analysis of the evolution of World Trade Center planning, construction, and results, see Angus L. Gillespie, Twin Towers (New Brunswick, NJ: Rutgers University Press, 1999). 30. See Port of New York Authority, A New Major Airport for the New Jersey-New York Metropolitan Area (New York, December 14, 1959), and articles in the region’s newspapers, December 15–20, 1959. 31. This was the fate, for instance, of local residents who objected to the building of the Lincoln Tunnel, or who wanted to restrict flights at the major airports because of noise; of the Newark city officials who were viewed as more concerned with patronage than economic growth when they tried to keep the Newark seaport out of the Port Authority’s clutches; and of the Greyhound officials who resisted moving into the Manhattan bus terminal. At times, as we have seen in earlier chapters, the Port Authority’s skilled staff helped to shape these critical assessments. 32. United States v. Tobin, 195 F. Supp. 588 (D.C. 1961). The details of Celler’s earlier efforts to help his clients are set forth in the telegram from Howard Cullman (Port Authority commissioner) to Emanuel Celler, August 1, 1960; it is reprinted in Tobin, Weekly Report, August 1, 1960. 33. See Tobin v. United States, 306 F. 2d 270 (D.C. Cir. 1962), cert. denied, 371 U.S. 902 (1962); and, on the new values, Jane Jacobs, The Death and Life of Great American Cities (New York: Random House, 1961). 34. See chapter 13 for discussion of some of these cases, and citation to the printed hearings. 35. From 1961 onward, there were specialists on the Port Authority staff who questioned whether a new, large airport would be needed in the coming decades to meet traffic demand. The development of wide-body aircraft, with much greater passenger loads per flight, would help to meet expected traffic growth; and substantial improvements at Newark Airport plus the use of a moderate-sized nearby private field might absorb the remaining increases in demand. Once the Great Swamp solution had been accepted at headquarters, however, those staff doubts seemed to receive little attention. It can be argued that the Port agency’s lengthy and unsuccessful battle reflected less an objective need than a traditional emphasis on big solutions over modest ones, coupled with a reluctance to abandon a project once it was passionately embraced. (See author’s interviews with Arthur Fallon and John Wiley, 1984–1986; also, J. W. Doig, “In Treacherous Waters,” 1986.) In the middle of the battle, several of the airlines joined the opposition, arguing that expansion of the three main airports, plus shifting small planes to secondary airports, might solve the problem. (See Plainfield Courier-News [NJ], Oct. 31, 1964; New York Times, Oct. 27, 1965, Aug. 25, 1966, and editorial, Dec. 30, 1966.) 36. Niccolò Machiavelli, The Prince (1513), trans. T. Bergin (New York: Appleton, 1947), chapter 25. There were exceptions at the Port Authority, however. For example, faced with increasing bus travel through the Lincoln Tunnel, the agency’s staff concluded that an exclusive lane for buses during rush hours would dramatically reduce congestion. That solution was adopted and has proven highly effective. 37. This effort, which arose in connection with renovating and expanding Newark Airport, is described in Cooper and Doig, “Austin Tobin and Robert Moses,” in Cooper and Wright, Exemplary Public Administrators, 1992, pp. 126–130.

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38. The large expenditures devoted to PATH in the 1960s might have been motivated in part by the Port Authority’s preference to have that rail line swallow up the entire “ten percent” available under the 1962 bond covenants, so that no funds would remain that might be allocated to other needy rail projects. Although PATH modernization did absorb the available funds, and so was consistent with that avoidance goal, it would be unfair to criticize the agency for the extensive and costly work there. Several of its best executives were chosen to lead the modernization effort, and the improvements were not “gold-plating” but, in the view of close observers, appropriate and helpful in retaining ridership. 39. Democrat Richard Hughes had served two terms as governor (1962–70), the maximum permitted under the state constitution. Cahill, his successor, was a Republican. 40. See Newark Star-Ledger, March 11, 1970; A. J. Tobin letter to Governor W. T. Cahill, March 11, 1970; author’s interview with John Kohl, March 1, 1984; and letter from J. Kohl to the author, March 2, 1984. Kohl was Commissioner of Transportation under Cahill; he was present at the meeting with Tobin, when Cahill reacted to the hotel plan, and he attended a number of later meetings on rail issues with Roger Gilman and other Port Authority officials. 41. In February, 1971, Cahill criticized the 1962 bond covenant as a “device” which Tobin and his aides had created “to escape additional responsibilities” in the rail field; and when Tobin commented at a legislative inquiry in March that the Port agency could not operate transit projects with large deficits, Cahill responded with acerbity that Tobin “will not be making the decisions on what the Authority can or cannot do.” (W. T. Cahill, “Remarks at Chamber of Commerce Dinner,” Feb. 4, 1971; New York State Assembly Committee on Corporations, and New Jersey Legislative Study Commission on Authorities, Joint Hearing [New York: March 5, 1971], pp. 92–93; New York Daily News, March 15, 1972.) 42. Port Authority, annual report for 1972 (pub. March 1973), pp. 4, 6–8; Newark StarLedger, April 18, 1972. The 10% rule is described in footnote 24 above. 43. John Hamilton, interview with N. A. Rockefeller, WNEW-TV, April 9, 1972 (transcript); New York Daily News, April 28, 1972. Ronan’s transportation authority, created in 1968, included New York City’s subways as well as commuter rail lines on Long Island and in the counties north of the city. The next several paragraphs draw upon Danielson and Doig, 1982, pp. 246–250, 343–344, and the author’s research in preparing those pages. 44. When the repealer was signed by the two governors in 1974, the United States Trust Company filed suit in New Jersey. In 1975–76, the state courts found the repeal constitutional. However, the U.S. Supreme Court disagreed, concluding that the repeal would permit Port Authority funds to be used without limit to finance rail projects, and that those projects might generate large deficits, thus undermining the agency’s ability to repay those who had purchased the bonds—a violation of Article I, Section 10, of the Constitution. See United States Trust Company v. State of New Jersey, 431 U.S. 1 (1977). After the 1977 decision, the Port Authority devoted substantial funds to bus terminals and related bus projects in New York and New Jersey. 45. As one senior manager recalled in 1980: “The ‘interregnum’ was a period of . . . six years with little top management leadership. The period resulted in increased ‘turfism’ in the Authority. Each director fought to put his department ahead of the next.” (Quoted in Andrew P. Kerr, “The Port Authority of New York and New Jersey,” Boston University

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School of Management, 1980, p. 23; and see pp. 24–28. See also “How the Richest Public Agency Lost Its Way,” Business Week, December 12, 1977, pp. 110–111; the author’s interviews with Port Authority staff members 103, 107, 162, 170, 1983–84.) 46. When the Metropolitan Transportation Authority was created in 1968, Moses was persuaded to resign and his Triborough Bridge and Tunnel Authority was included as a subordinate unit of the MTA. Triborough surpluses were then used to offset rail deficits. As Moses lamented in 1970, Triborough’s “program of expansion is dead. . . . It has become another routine, static, bureaucratic agency.” Robert Moses, Public Works: A Dangerous Trade (New York: McGraw-Hill, 1970), pp. 260–261. See also Danielson and Doig, 1982, pp. 231–234, 250. 47. The text quotes are from Frank Prial’s article, Nov. 10, 1974. A selection of headlines from the New York Times captures some of the issues: “Port Agency Seeks Successor to Tobin Within the Authority,” March 16, 1972; “Port Authority Dissent: Ronan Gives a Hint of the Bitterness and Strife Among the Commissioners,” April 1, 1972; “Ferment in Mass-Transit Agencies,” April 5, 1974; “Ronan and Port Authority: Number of Financial Men on Board Raises Questions of Commitments,” Oct. 11, 1974; “Port Authority Has Fallen on Hard Times,” Nov. 10, 1974. 48. See Port Authority, annual reports for 1974, 1975 and 1976; New York State Comptroller, “Public Authority Financial Analysis Statements, No. 8–76” (Nov. 1976); Joe Mysak with Judith Schiffer, Perpetual Motion: The Illustrated History of the Port Authority of New York & New Jersey (Los Angeles: General Publishing Co., 1997), pp. 174–175. 49. Goldmark’s focus on the loss of jobs in older cities stemmed from his recent work as state budget director and his experience in the 1960s in New York City government. On Goldmark’s views, see Port Authority Diary, October 1977; Martin Barash, “Peter C. Goldmark, Jr.: A Biographical Study of Innovative Leadership,” senior thesis, Princeton University, 1989, chapters 3–4. 50. On the early development of the industrial park plans and other projects mentioned in the text, see Port Authority of NY&NJ, Committee on the Future, “Regional Recovery: The Business of the Eighties,” June 1979, and the Committee’s task force reports; Port Authority, annual report for 1981, pp. 7–10. For the critics’ views, see David Yellen, “Urban Industrial Renewal and the Port Authority,” 1982, pp. 20–28 (in the author’s files); Malcolm S. Forbes, “Here We Go Again,” Forbes, April 3, 1978, p. 3; New York Times, March 13, 23, 1981. 51. On the evolution of the industrial parks and other Goldmark initiatives through 1985, see the Port Authority’s annual reports for 1985 and 1986; also, Steve Silverman, “Bathgate Industrial Park,” Woodrow Wilson School, May 1982 (author’s files). For comments on the projects and their impact on the Port Authority’s work and reputation, see Barash, 1989, pp. 18–24, and New York Times, October 1, 1984, Nov. 22, 1991. 52. Developments during the Berger years are summarized in the annual reports of the Port Authority; as to the items noted in the text, see the annual report for 1989, pp. 6, 10, 16, and 27–30. On Governor Kean and the Newark Legal Center, see his Message to the Legislature, Jan. 9, 1984, and New York Times, Jan. 10, 1984. 53. New York Times, April 12, 1990. On the views of the agency’s new leaders, see also New York Times, Nov.22, 1991, and Port Authority, annual report for 1990; the Brezenoff

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quote is on p. 8. During his tenure, funds were also spent on projects begun under Berger and Goldmark—the industrial parks, which continued to produce jobs but also operated at a deficit; the Essex County incinerator complex, which began operation in 1990; and waterfront development projects being constructed at Hunters Point in Queens and planned at Hoboken. For summaries of these activities, see Port Authority, annual reports for 1990 (pp. 18–19), 1992 (pp. 17–18), 1994 (pp. 18–23); Mysak with Schiffer, 1997, pp. 199–203. 54. On the issue of “twinning the Goethals” (as the Staten Island bridge project was called), see Port Authority, annual report for 1990, p. 27, and 1993, p. 16; also, Newark Star Ledger, Sept. 9, 1999. The proposal has been criticized as more likely to add to truck and automobile congestion than to relieve it (for example, see New York Times, Jan. 27, 1998). The airport rail links are described in the New York Times, Nov. 22, 1991, and in the Port Authority, annual report for 1992, pp. 14–15; the addition of a special passenger fee at the airports provided dedicated funds for those expensive projects. As to the freight-passenger rail tunnel, see Port Authority, annual report for 1993, p. 18, and “Access to the Region’s Core,” report by the joint committee of the Port Authority, NJ Transit, and New York’s Metropolitan Transportation Authority, July 1998. This proposal is a variant of the Port Authority’s 1921 freight plan, which would have taken the New Jersey railroads under New York Bay directly to Brooklyn, with a separate rail line from New Jersey to Manhattan. The Brooklyn-to-New Jersey tunnel proposal has been resurrected by U. S. Representative Jerrold Nadler, and Mayor Giuliani has endorsed a tunnel from Brooklyn either to New Jersey or to Staten Island (the latter Mayor Hylan’s 1920s dream). Giuliani’s plan includes transforming the Brooklyn waterfront into a major containerport. However, as one expert cautions, “Containerships are getting larger and larger, requiring more and more land space. The expense of extending back-up areas in Brooklyn would . . . require the uprooting of hundreds or even thousands of families” (letter to the author, Sept. 20, 1999). On these developments, see New York Times, Jan. 15, 1997 and March 3, 1998, and January 26, 2000, and the Times editorial endorsing the rail tunnel, Jan. 18, 1997. On the 1920s efforts, see chapters 4–5. The passenger transit aspect of the 1990s Port Authority plan is a variant of the New Jersey-to-Manhattan rail transit tunnels studied by the Port Authority and other agencies in earlier decades. For examples of recent opinion, largely favorable, see the editorial in the Newark Star-Ledger, Jan. 4, 1998; Philip Barbara, “Federal planning can get new rail lines on track,” Newark Star-Ledger, March 22, 1998; and Al Frank, “Study resumes for $5B Hudson rail tunnels,” Newark Star-Ledger, Nov. 23, 1998. 55. With the PATH fare at $1, each passenger trip involved a subsidy of $3.50. The bus terminal also generated large deficits, reaching more than $60 million/year in the early 1990s. However, these losses were partly offset by surpluses at the World Trade Center, which had moved from a red-ink operation in the early 1980s to an annual surplus of $100 million by 1993–94. One Port Authority commissioner pointed to a “financial dynamic” during many of the post-Tobin years which undermined the Authority: There were periods in which both states had “chronic budget crises,” while at the same time the agency found costs rising and needed higher trans-Hudson tolls. But to increase tolls, they needed approval from

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states that were “desperate for new revenues.” Perhaps it was “inevitable, then, that toll increases would be permitted only if states took an increasingly large share of the proceeds. This process . . . left the agency in need of more funds sooner, setting the whole game in motion anew.” (Letter to the author, Sept. 16, 1998.) Moreover, the environmental movement and the community-control ethos, which had, as noted earlier, helped to block the Great Swamp jetport in the 1960s, continued throughout the next three decades to cast obstacles in the way of large Port Authority projects. On the issues discussed in the text, see Port Authority, annual report for 1990 (p. 8), 1991 (p. 10), 1992 (p. 9), 1993 (p. 10), 1994 (pp. 3,23); and calculations made by the author in 1995 from agency records. 56. For a balanced assessment of the Kennedy Airport project and its problems, see “Oversight at, and of, the Port Authority,” editorial, New York Times, May 27, 1992. 57. See Port Authority, annual report for 1992 (p. 30), 1993 (pp. 9, 33–34); and Port Authority, Diary Extra, March 10-July, 1993, and Diary, no. 2, 1993. 58. The Celler inquiry had uncovered the political use of insurance contracts by agency executives (see chapter 13), and identified a staff member who had received payoffs from specific vendors. The cases in the 1970s involved about 25 staff members who padded their expense vouchers and two who hired relatives in violation of the agency’s anti-nepotism policies; the details are in the reports of the New York State Comptroller on the Port Authority of NY&NJ, 1977–78. On patterns of abuse in other organizations, see Frank Anechiarico and James Jacobs, The Pursuit of Absolute Integrity (Chicago: University of Chicago Press, 1996), and David Ermann and Richard Lundman, eds., Corporate and Governmental Deviance (New York: Oxford University Press, 1996). 59. The conflicts of 1916 ff. are described in chapters 2–3 above. For interpretations of the recent tensions and contests, which continue into the new century, see Robert Sullivan, “The War Between the States,” New York Times, May 28, 1998 (for a 10-year overview); “Seeking United Front as Region Competes for Companies,” New York Times, October 7, 1991; “New York and New Jersey Battle Anew Over Business,” New York Times, July 1, 1997; “Ties That Bind New Jersey Begin at the Hudson River,” New York Times, June 13, 1999. The battle over Ellis Island was won by New Jersey; see State of New Jersey v. State of New York, 1998 Lexis 3405 (U.S. Supreme Court decision, handed down May 26,1998), “Now it’s Ellis Island, N.J.,” Newark Star-Ledger, May 27, 1998, and “Pride, Prejudice and Border War Bluster,” New York Times, May 31, 1998. For an historical overview, see Michael Birkner, “Whose island is it, anyway?,” Newark Star-Ledger, June 16, 1996. 60. See, for example, “Giuliani Suggests Privatizing of Airports,” New York Times, Dec. 10, 1994; “Port in a Storm,” New York Times, August 30, 1995; “Mayor Urges Breakup of Port Authority,” New York Times, June 1, 1996. 61. Thomas Kean and Mario Cuomo, letter to the Board of Commissioners, Port Authority of NY&NJ, n.d., ca June 1983; New York Times, Jan. 13, 1984; Newark Star-Ledger, Oct. 14, 1984. Some of the funds have, however, been used to pay for important rail improvements in Hudson Counties and adjacent areas. Plans to tap Port Authority revenues for additional “regional banks” were underway as the decade ended. See New York Times, Dec. 23, 1999.

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62. This summary is based upon interviews held in 1996 and 1999 with several Port Authority staff members. See also “Mr. Pataki’s Mediocre Choices,” editorial, New York Times, Jan. 12, 1995; Richard C. Leone, “Pataki’s Politics; Everyone’s Port Authority,” New York Times, Jan. 7, 1995; New York Times, Jan. 13, 14, Feb. 5, 10, 1995; Bergen Record, Feb. 8, 1995. Governor Whitman’s willingness to embrace Marlin surprised some observers, in part because she had supported the agency’s professionalism in her first year in office, and partly because of a family connection to Progressivism and the bi-state agency: her husband is the grandson of Governor Charles Whitman of New York, whose important role in the creation of the Port Authority is described in chapter 2 above. The “brain drain” quotation is in the New York Times, Jan. 18, 1997. 63. The plan endorsed by the Port Authority board in July 1998 allowed Boyle and each of the twelve commissioners to nominate two applicants, who would be given special advantages in the competition for appointment to the agency’s police force. Boyle and members of the board had already named twelve who would receive this special benefit, when the Star-Ledger learned of the new plan. Since it had been adopted secretly, and kept out of the Minutes which can be vetoed by the governors (and are publicly available), Whitman was apparently “outraged” and demanded that it be withdrawn, as it was. See internal Port Authority memoranda, July 30, 1998 and Sept. 30, 1999 (in author’s files); Al Frank, “Whitman seeks answers on P.A.’s new influence over recruits for police,” Newark Star-Ledger, Sept. 2, 1998; Frank, “P.A. scuttles new police nominating policy: chairman apologizes for possible favoritism,” Star-Ledger, Sept. 3, 1998; David Kocieniewski, “Port Authority Drops Secret Plan for Police Department Patronage,” New York Times, Sept. 3, 1998. On other recent allegations of favoritism at the Port Authority, see Clifford J. Levy, “After Paying Pataki’s Fare, a Free Office,” New York Times, Oct. 11, 1999. 64. On conflicts between the states, see Charles Bagli, “2-State Dispute Over Shipping Lines’ Lease Clouds Port Authority Future,” New York Times, April 20, 1999; Al Frank, “The Ship of Respect Sank Feb. 23: Can the Port Authority Survive It?,” Newark Star-Ledger, May 9, 1999; Ronald Smothers, “Port Authority and 2 States Discuss Lease for Terminal,” New York Times, Dec. 23, 1999. On positive developments and plans, see Port Authority, annual report for 1998, pp. 15–17; Anthony Cracchiolo, “Airtrain: New York’s Light Rail System to Improve JFK Airport Access” (Port Authority, Sept. 1999); booklets on Newark Airport monorail and links to the main New York-Philadelphia rail line (Port Authority, September 1999); Port Authority et al., “Access to the Region’s Core,” 1998; Dan Barry, “Port Authority Won Uphill Battle to Build Train to the Plane,” New York Times, June 6, 1999; Thomas J. Lueck, “Port Authority Offers Its Vision of New York Harbor,” New York Times, Jan. 14, 2000; David W. Dunlap, “J.F.K. Enters the Era of the Megaterminal,” New York Times, March 19, 2000. The renewed hostility between the two state executives was driven in part by the old debate on whether Port Authority activities benefit one state to the disadvantage of the other. See Ronald Smothers, “Feud Over How Port Authority Spends Money Creates an Impasse,” New York Times, Feb. 24, 2000; Al Frank, “Whitman’s Deal Fails to Break P.A. Stalemate,” Newark Star-Ledger, Feb. 25, 2000. 65. The decline in average quality and independence of the Port Authority board, leading toward the 1998 police-patronage episode, has been the subject of quiet concern

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by board members. As one former commissioner commented, “Most of the board members in recent years have been ‘yes men’;” they get their “marching orders” from the governors’ offices. Another said that the change seemed to begin in the 1970s, when independent and wealthy men such as Howard Cullman, Bayard Pope and Paul Stillman were replaced by those “without independent means, who often had future hopes for party rewards.” A third argued that the current situation would change only if “visionary governors appreciate what this revenue source can do, and then find a visionary, energetic leader and give him or her the ball. As long as every major decision is checked with Albany and Trenton first, revenue-raising actions and visionary planning will take a back seat to the expediency of the moment.” (Letter to the author, July 31, 1998; interviews with the author, Sept. 8, 1998, Sept. 10, 1998.) 66. In its Third Regional Plan, RPA argues that the Port Authority has been “hobbled by short-sighted interference” and criticizes the governors of the two states for pressing the agency into “commercial real estate, waste management, and urban revitalization activities,” absorbing funds that should have gone into airports and other transport facilities (which have been “starved of capital and operating funds needed to maintain them”). The RPA proposal involves creating a new Regional Transportation Authority which would have control over the region’s rail transit and bus systems; the Port Authority’s toll bridges and tunnels, as well as PATH, would also move to the RTA. The Port Authority would sell the World Trade Center, the industrial parks, and all other operations except the airports and seaports. (Robert D. Yaro and Tony Hiss, A Region at Risk: The Third Regional Plan for the New York–New Jersey–Connecticut Metropolitan Area [Washington, D.C.: Island Press, 1996], pp. 206–7, 211–12.) Mayor Giuliani’s proposal is summarized in “Mayor Urges Breakup of Port Authority,” New York Times, June 1, 1996; see also “Newark Tops N.Y. as Airport Cash Cow,” Newark Star-Ledger, June 6, 1999. A third alternative—carving off the non-transportation programs, but leaving the agency with the bridges, tunnels, and PATH, as well as the airports and seaport—might better maintain the advantage of region-wide focus combined with a variety of activities and funding sources likely to attract high-quality staff to the agency. John Hylan’s advice to Al Smith is discussed in chapter 4, above.

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D

irectly and indirectly, the origins of this book reach back a long while. In the winter of 1958, as I was casting about for a dissertation topic, a scheme for a new subway system joining Manhattan and New Jersey’s suburbs hit the front page of the New York Times. Wallace Sayre and David Truman at Columbia suggested that proposal might be worth exploring; John Sly, who taught at Princeton and had served on the Port of New York Authority’s governing body, offered to help me gain access to the unpublished documents that lay behind the proposal; and I was soon on my way. During the years that followed, I worked on several projects that focused in part on the activities, the strategies, and (some would say) the machinations of the Port Authority. And I worked on other topics well. But my interest often returned to that complex agency and its ability to “get things done”—and to the costs as well as the benefits of its vigorous efforts. In the 1980s, I decided to probe the Port agency’s evolution by using a combination of institutional and individual biography (an approach described in chapter 1), and in the course of this research I compiled a number of debts, recorded here. My greatest debts are to several long-term members of the Port Authority “family” and to family members of the key figures in this book. These include Roger Gilman, who began at the Port Authority in 1936, stayed there for more than forty years, and discussed the agency and its policies with me for dozens of hours during a decade of conversations; Dan Goldberg, Mort Edelstein, and Sidney Goldstein, whose work in the agency’s Law Department began in the 1930s and who, in a series of interviews and written notes, recalled that decade and the 1940s in rich detail; Doris Landre, Secretary of the Port Authority in the 1980s, who gave me access to a vast array of files and opened the door to interviews with senior officials, current and retired; and Othmar H. Ammann’s daughter, Margot Ammann Durrer, whose remembrances, together with her files of letters and skilled translations, helped fill in crucial pieces of the Port Authority’s history in the 1920s and 1930s. 555

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Austin Tobin’s family provided many and valued contributions—his daughter, Stacy Tobin Carmichael, and his son, Austin Jr., offered extensive recollections of family and Port Authority life in the 1930s and later decades, as well as letters and photographs; his brother William and his sister-in-law, Janet Tobin, captured events and issues of those decades; Austin Jr.’s daughter, Farley, retrieved a set of photographs included in this volume; and Stacy’s daughter, Bevin, worked as my research assistant in the 1980s, gathering, sorting and commenting insightfully on documents that were crucial to telling the story. John Fitzgerald, a friend of Austin Tobin for five decades, recalled important events across those years as did Tobin’s schoolmates, Thomas Lamb, Paul Fitzgerald, and Miles McDonald. Others at the Port Authority and beyond contributed valuable insights on complex issues, as well as helpful suggestions on draft chapters. Cliff O’Hara, Lee Jaffe, Rosaleen Skehan Tobin, Bill Pallmé, Werner Ammann and Sam Moerman had knowledge that extended deep into the Port Authority’s early history. I should take special note of recollections and materials provided by Edna Goelz Falconer, whose career began in 1918 with the bi-state study commission, Nathan Cherniack, who came to the Port Authority in 1923, and Rose Lewin Hershdorfer, who joined four years later. Some had extensive experience both inside the bi-state agency and outside, permitting them to evaluate its strengths and foibles with a healthy dose of comparative knowledge; I note here particularly the valuable discussions with Dan Kurshan, Harvey Sherman, Don Bagger, Lou Gambaccini, Bob James, Ted Olcott, Richard Sullivan, John Wiley, Art Fallon, Martin Robins, Joe Lesser, Jeffrey Green, Kristina Stillman, Richard Roper and Tony Shorris. In briefer encounters, many others helped to fill in important pieces of the Port Authority puzzle; these include Leon Katz, John Brunner, Fred Glass, Lillian Borrone, Bill Starr, Matthew Edelman, John Foster, Guy Savino, Hervey Law, Tommy Sullivan, Charles Kushell, Hugh Welsh, Doug Tuomey, Duncan Reid, Derwood Hall, Henry Klingman, Hendryk Weeks, Rosemary Scanlon, Roger Cohen, Hugh O’Neill, and Bob Unrath, as well as Lou Calta, Herman Mertins, Henry Reining, Robert Bennett, Guy Tozzoli, Al Dearden, Charlie Greenberg, Tony Tozzoli, Sholem Friedman, Pat Falvey, Art Mulhern, Isobel Muirhead, John Eyre, David Glickman, Barbara Frink, Barbara Norton, Ann Peel, Winifred Kelly, Connie Della Barca, Mildred Schneider, David Plavin, Neil Montanus and Judy Schiffer. Some of those listed above I had known as students at Princeton, which eased the path of frank exchange. Several of the Port Authority’s executive directors—Peter Goldmark, Stephen Berger, Stanley Brezenoff, and Robert Boyle—offered useful in-

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sights, as did the agency’s commissioners—in particular Paul Stillman, Charles Hamilton, Alan Sagner, Richard Leone, Kathleen Donovan, Melvin Schweitzer, James Hellmuth, Lewis Eisenberg, and two who have asked to remain anonymous. A discussion with Peggy Cullman, the widow of the Port Authority’s long-serving chairman, Howard Cullman, was also very helpful, as were materials provided by her and by Joseph Byrne III, the son of commissioner Joseph Byrne, and by commissioner John Borg’s grandson, Malcolm Borg. The librarians at the Port Authority were always responsive in providing guidance and locating documents. Robert Moses sat with me for a long interview in the years before this project took explicit shape, and he and his assistants then gave me a set of documents that have been of real value; and two insightful research papers written by his niece, Amy Koziak, at Princeton, added to my understanding. In gauging Moses’s behavior and impact, I also benefited from discussions with Bob Caro and materials which he and Ina Caro provided, although at crucial points, as indicated in the text, our conclusions differed. In exploring the career of the great bridge-builder, Othmar Ammann, and his impact on the Port Authority, I was aided by evidence provided by Karl Niederer of the New Jersey State Archives, Urs Widmer in Switzerland, and Sylva Brunner. Railroad executives Jervis Langdon and John Kenefick challenged my optimism about the Port agency’s early rail plans. Planners and officials of other organizations whose activities intersected with the Port Authority at important points offered helpful information; especially beneficial were recollections by Harland Bartholomew, McKim Norton, Eugene Black, Bob Tuttle, John Kohl, George Howard, William Anderson and John Burnett. Four of New Jersey’s governors—Richard Hughes, Robert Meyner, William Cahill, and Brendan Byrne—provided valuable insights on the wary appreciation in which the Port Authority has been held in Trenton; and the complex relationships between the bi-state agency and New York City were captured in part through interviews with Robert Wagner (Manhattan borough president, and later mayor of New York City and commissioner of the Port Authority), state legislator Abbott Low Moffat, and urban planner Ed Logue. Crucial to my understanding of the Albany perspective in the 1940s and 1950s were discussions with Charles Breitel, Lawrence Walsh, and Edward Kresky. In the scholarly community, I conferred with those who have studied and written on public authorities and other government agencies, and many were generous enough to read drafts and offer suggestions on issues needing further exploration and on conclusions that deserved rethinking. These include

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Herbert Kaufman of Yale and the Brookings Institution; Erwin Hargrove at Vanderbilt University; Philip Selznick at the University of California, Berkeley; Ken Jackson, Ester Fuchs, and Lynne Sagalyn at Columbia; Bob Fishman of Rutgers; Michael Birkner at Gettysburg; Pat Dobel of the University of Washington; Bernie Frieden at MIT; Dick Neustadt at Harvard; Peter Drucker of NYU & Claremont; and Steve Erie of the University of California, San Diego. At Princeton, conversations and collaboration with David Billington, Mike Danielson, and Arthur Link were especially valuable, and at various points I received good advice from Fred Greenstein, Alpheus T. Mason, Stephen Holmes, David Bradford, Andy Koppelman, Dick Nathan, Bob Curvin, John DiIulio, Duane Lockard, Julian Wolpert, Bob Tucker, and Don Stokes. Also very helpful were exchanges with Erwin Bard, retired from Brooklyn College, Robert Smith at Drew, Eugenie Birch at Hunter College, James Q. Wilson of UCLA & Harvard, Jerry Mitchell at the City University of New York, and Mitchell Moss, New York University, as well as Pendleton Herring, Fritz Mosher, Paul Kantor, Norton Long, Dwight Waldo, Robert Wiebe, Luther Gulick, Arthur Schlesinger, Josef Konvitz, Charles Adrian, Herman Boschken, Clarence Stone, Gene Lewis, Annmarie Walsh, Alberta Sbragia, Bob Kagan, Alan Altshuler, Fran Burke, Terry Cooper, Dick Loverd, Gerald Fetner, Bob Wood, Olivier Zunz, David Johnson, Keith Revell, Dennis Muniak, Mark Hughes, Clifton Hood, Samuel Florman, David Perry, Martha Weinberg, Mike Frisch, Kate Foster, Paul Lewis, Robert Cuff, Michael Ebner, Richard L. McCormick, Carl Condit, Charles Adrian, Dorothy Nelkin, Harold Seidman, Leonard Wallock, Bob Axelrod, Aaron Wildavsky, and George Frederickson. Specific debts to their writings are recorded throughout the book. Writers Jan Morris, Diana Henriques, Al Frank, Phil Barbara, Tom Buckley, Rebecca Shanor, Madeline Rogers and William Leech also offered stimulating ideas and information, as did my colleagues involved in creating the Regional Plan Association’s third regional plan in the 1990s, led by Bob Yaro. Wayman Williams created a series of new maps, reproduced and modified more than ninety photographs, and offered solid advice on effective ways to link the photographs to the text. I am grateful as well for the financial support provided by the National Endowment for the Humanities, Lavanburg Foundation, Alfred P. Sloan Foundation, Social Science Research Council, Swiss American Historical Society, and the Twentieth Century Fund, as well as Princeton University and its Woodrow Wilson School. Grants provided by these institutions facilitated research trips and two academic leaves and permitted me to make copies of thousands of pages of letters, reports and other documents.

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In gathering documents, arranging research trips, sending out draft chapters and keeping track of files, I have relied during the past dozen years on several members of the Princeton University staff—Alexis Faust, Kety McCoach, Lynn Ratsep, and especially Nancy Danch. My thanks for your great help. Princeton students, notably Cheryl Mares, Michael Fulop, Edgardo Lopez and Carol Zall, helped to gather valuable information in the early stages of the research. At Columbia University Press, my thanks to Leslie Bialler, who copy-edited the manuscript with real skill, and to my editor, Kate Wittenberg, whose support and patience, as I and the manuscript took various detours along the way, are much appreciated.

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Index

Abell, Frank, 258, 526n18 Accountability, democratic, 8, 15, 20–23, 39, 49, 146, 148, 150, 167, 291, 361, 367–72, 425n19, 541n20 Adams, Henry, 412n5 Air France, 303, 307, 518n34 Airlines National Terminal Service Company (ANTSCO), 518n35 Airport Operators Council (AOC), 300–302, 313, 363, 516n28, 517n30–31, 523n62, 523n63, 540n8 Airports, 251ff., 288ff. European, 301, 517n28 maintenance facilities, 293 management of, 510n84, 515n16 New Jersey and New York, 160–61, 191, 239, 247–48, 251, 253 fig. 11-1 (map), 254–55, 259–64, 266, 268–82, 285, 288ff., 501n22, 504n35, 505n39, 507n54, 508n63–64, 510n72, 510n75–76, 510n84, 512n99, 513n5, 514n12, 516n23, 516n26, 517n29–30, 517n32, 522n57, 528n28, 540n8, 543n5, 547n31, 547n33, 547n35, 550n54, 551n60, 553n66 nonflight income, 299 rail links to, 550n54 regional cooperation, 272, 291 self-supporting, 516n26 United States (outside New York and New Jersey), 21, 292, 295, 298–303, 327, 364, 446n2 (Oakland, San Francisco), 500n14, 511n84,

516n27, 517n28–29, 518n35, 540n8, 540n12 See also Idlewild; Kennedy; LaGuardia; Newark; Teterboro Airports and Air Carriers, 301, 517n30 Air Transport Association (ATA), 294, 297, 300–302, 304, 305, 516n28–29, 517n32, 518n35, 519n38, 520n42–43, 523n62 Aix la Chapelle-Maastricht R. Co. v. Thewis, 204 Alexander, Harry, 264, 500-501n20 American Airlines, 274, 277 fig. 12-1 (table), 280, 296, 311, 513n7, 514n9, 515n19–20, 518n35 American Bar Association (ABA), 229, 432n64 American Municipal Association, 218, 221, 517n31 Ammann, Lilly, 455n10, 459n26, 460n32 Ammann, Margot (Margot Ammann Durrer), 448n10, 448n14, 450n22, 450n25, 451n26, 455n10, 459n26, 460n32 Ammann, Othmar H., xiii, xvi, 108, 121, 190, 193, 442n27 administrative skills of, 123, 127, 146, 458n26 aesthetics of, 131 Ammann & Whitney, 379 biography, 18 bridges, 379, 447n6, 449n21, 450n23–26, 453n38 coalition-building skills of, 121–22, 13334, 138–41, 193

561

562

index

and collapse of Quebec bridge, 454n4 and construction of bridges, 474n26 death of, 379 diaries of, 454n8–10, 456n13 early life of, 122–25, 447n5 engineering judgment, 126–28, 146, 182, 193, 447n5 and George Silzer, 122, 129–42, 442n27, 447n5, 449n16, 449n19, 451n27, 452n32, 452n34–36, 453n38, 453n40–46 George Washington Bridge, xvi, 18, 120–22, 125–42, 143–57, 161, 164, 171–72, 182, 197, 200, 222, 284, 290, 315, 376–79, 450n23, 457n19, 458n25, 459n32, 461n37 and Gustav Lindenthal, 18, 122–29, 131, 138, 153, 449n16, 451n28–29, 452n35, 453n38, 459n27, 513n5 highway projects, 379, 452n37 and Joseph Strauss, 459n30 Lincoln Tunnel, 379 and new transportation patterns, 452n37 and Port of New York Authority, 183, 190, 193, 362–63, 370, 379, 452n37 retirement of, 233 and Robert Moses, 190 and Roebling Company, 149, 456n14, 458n24, 459n31, 460n39 Such Clay Pottery Co., 123, 129 surprise dinner for, 458n26 testing laboratory, 156 values of, 125–28 Ammann, Rosa Labhardt, 448n14, 459n26, 460n32 Ammann & Whitney, 379 Anderson, William, 264, 265 Anti-Semitism, 12, 19, 211, 237, 239, 248, 256–57, 372, 483n54, 501n24, 509n69 AOC. See Airport Operators Council Arthur Kill bridges, 140 waterway, 29 fig. 2-1 (map), 81, 112, 113 fig. 3-3 (map)

ATA. See Air Transport Association Authorities, public, 2, 22, 30, 363–64, 411n2, 540n8. See also Port of London Authority; Port of New York Authority; Tennessee Valley Authority; Triborough Bridge and Tunnel Authority Automobile transportation, 108–109, 120, 183 traffic congestion, 183, 190, 289, 316–17, 320–24, 351, 376, 377, 379, 422n3, 474n28, 525n6, 527n20–21 Autonomy. See Political insulation Bailey, Stephen, 351–54, 537n105 Bard, Erwin W., 233, 249–50, 393, 417n12, 418n27, 422n3, 429n42, 435n16, 436n28, 438n3, 446n54 Bartholomew, Harland, 163–66, 278, 321, 506n43–45 Bayonne Bridge, xvii, 18, 157, 172, 439n6 Bayonne Times, 281, 285 belt lines, 91 fig. 4-4 (map), 94, 173, 174 Belt Line No. 1, 89, 90, 93, 104, 106, 111 Belt Line No. 12, 93 Belt Line No. 13, 90, 91, 92, 104, 106, 107 fig. 5-2 (map), 109, 110 Benjamin Franklin Bridge (Delaware River), 208, 450n23, 459n27 Bergen County, N. J. belt line in, 90 and bridges/tunnels,politics in, 130, 133, 139, 150 Bergen Evening Record, 131, 140, 453n42, 44, 503n30, 508n65, 526n15,18, 528n30,32, 531n54, 552n62 Berger, Stephen, xiii, 395–97, 399 Billington, David, 450n23 Black, Eugene, 272, 487n11, 495n66 Black, Hugo, 485n58 Bonds. See Tax exemption: municipal bonds and salaries Borg, John, 258, 338, 503n30, 528n32 Boyle, Robert, xiii, 401, 552n63

index Bradford, Robert, 301, 516n28 Brady, John A., 267, 273, 279–80, 507n49 Brandeis, Louis D., 17, 30, 31, 40, 241–42, 362, 418n27, 419n32, 420n34, 482n47, 484n56, 497n73 Breitel, Charles, 308, 521n51, 523n58, 535n86 Brennan, William Joseph, Jr., 498n78 Brezenoff, Stanley, xiii, 396–97, 399 Bridges Ambassador, 450n23 Bear Mountain, 450n23 collapse of Quebec, 454n4 Delaware River (Ben Franklin bridge), 208, 450n23, 459n27 Hudson River, proposed, 135 fig. 6-1 (map) Manhattan, 417n19, 448n13, 450n23, 458n23 New Jersey–Staten Island, 113 fig. 5-3 (map) over Harlem River, 417n19 Queensboro, 417n19, 448n13 railroad, 18, 82, 102, 111, 127 suspension systems, 147ff. vehicular, 18, 33, 82, 98, 108, 134, 449n20, 452n32 Williamsburg, 417n19, 448n13, 450n23 See also Ammann, Othmar H.; Bayonne Bridge; Benjamin Franklin Bridge; Bronx-Whitestone Bridge; Brooklyn Bridge; George Washington Bridge; Goethals Bridge; Hell Gate Bridge; Lindenthal Bridge; Outerbridge Crossing; Throgs Neck Bridge; Verrazano-Narrows Bridge Bronx-Whitestone Bridge, 18, 378, 474n26, 543n6 Brooklyn, 62, 86 Brooklyn Bridge, 33, 211, 353, 382, 457n23 Brooklyn Chamber of Commerce, 68, 187, 204 Brooklyn Daily Eagle, 55, 59, 436n29

563

Brooklyn piers, 4, 28, 86, 102, 253 Brown, Prentiss, 223, 227–28, 490n35–36, 491n37,39 Buck, R. S., 151, 152, 457n23, 458n24,26 Buckley, James, 262–63, 294, 295, 303–304, 313, 505n39, 506n42, 514n12, 517n32, 518n36–37 Bulova Watch Company, 339 Burden, William, 506n42 Bureaucracy (Wilson), 364 Burnham, Daniel, 125–26 Burr, William, 153, 458n25 Bus terminals, 315–18 See also Greyhound Bus Company; Port Authority Bus Terminal Buses, 315 See also Bus terminals; Greyhound Bus Company; Port Authority Bus Terminal Bush, Irving, 30, 43, 45, 204, 210, 415n6 Bush Terminal Company, 415n6, 479n31 Bush Terminal Company et al., v. City of New York and the Port of New York Authority, 203–206, 210, 213, 232, 479n31, 480n32,33,36, 490n30, 493n48 Byrne, Brendan T., xi, 392–93, 400 Byrne, Joseph, xii 236–39, 258, 264, 267, 269, 271, 285, 291, 305, 365, 495n62, 502n25, 507n50, 509n67, 521n48 CAB (Civil Aeronautics Board), 263 Cahill, William T., xi, 247, 389–93, 399, 548n39–41 Capitalism, 1, 5, 7–8, 11, 100, 102–103, 167, 185, 290 “Capitalist ethos,” 290, 292, 327 Cardozo, Benjamin, 484n56 Carey, Hugh J., xi, 394, 399 Carmichael, Bevin, 515n22 Carmichael, Stacy Tobin, 211, 477n15, 483n50 Caro, Robert, 4, 20, 322, 331, 376–77, 425n20, 507n58, 510n75, 525n13, 530n44, 531n48, 534n67, 544n13

564

index

Carty, Joseph, 336–37, 532n58 Catholic Church, 194–95, 211, 286–87, 475n4, 477n13, 512n103 Cavanaugh, Cam, 438n3 Celler, Emanuel, 339, 386–89, 398, 533n65–67, 547n32, 551n58 Cherniack, Nathan, 378 Christian Science Monitor, 268 Citizens Union, 31, 42, 55–56, 63, 72, 114, 276, 425n21 City Airport Authority, 268–71, 276, 282, 293–94, 323, 328, 402 Civil Aeronautics Board (CAB), 263 Civil Service Commission, U.S., 423n11, 425n17 Cohen, Julius Henry, xiii, xvi, xix, 10, 17–19, 21–22, 27, 31–32, 47–48, 391, 401, 415n6,9, 416n11–12, 419n34, 420n39, 421n45, 422n8 and Al Smith, 56ff., 65–69, 161–66 and Austin Tobin, 17, 19, 197–98, 203ff., 209ff., 214–16, 219, 223 fig. 10-1 (cartoon), 232, 237ff. biography, 17–18 coalition-building skills, 42, 193, 240 Committee of 100, 41, 415n9 and creation of the Port of New York Authority, 21–22, 30–46, 48–61, 65–73, 336, 424n14,15 early life, 17–18, 31–32 general counsel for the New York State Chamber of Commerce, 31, 39, 66 general counsel for the Port of New York Authority, xiii, 17–18, 94, 137–40, 158, 161, 190–93, 196, 215ff., 249, 361–62 general counsel for the Port and Harbor Development Commission, 45 and the Hell Gate Bridge, 111, 116, 158 and the Holland Tunnel, 17–18, 122, 146, 166–71, 200, 426n25, 438n4 and influence of London and Liverpool, 423n12

personal characteristics of, 31, 47–48, 326, 352, 365 perspective on the New York region, 44ff., 96, 145 on political favoritism 19, 162–65, 197 and Progressive reform, 17–18, 54, 173–77, 361, 370–71 and railroad negotiations, 98-100, 104–106, 108–119, 158 and rail transit, 161 retirement of, 237-39, 247 and Robert Moses, 17, 20, 190 and tax issues, 198-206, 208–13, 215–16, 219, 222-23, 228-32 and U.S. Congress, 50, 69, 104, 111, 117, 171, 228–29, 232, 242 Collector v. Day, 206, 208, 213, 224, 477n18, 484n58 Colt, Sloan, 543n8 Commissioner of Internal Revenue v. Shamberg’s Estate, 229 Committee on the Future, 394 Committee on the Regional Plan, 114, 136–37, 177. See also Regional Plan Association Commuters. See Buses; Rail transit Compact Clause. See Constitution, U.S. Compact of 1834, 32–33, 41, 50 Compact of April 1921, 432n3, 435n27 Competition. See Efficiency Comprehensive Plan, 77, 78, 88ff., 98, 104, 108, 109, 110, 111, 114, 118, 120, 125, 134, 145, 156, 158, 160, 175, 184, 199, 201, 205, 210, 250, 289, 435n25, 436n27,31, 437n33, 438n4, 442n26, 445n50, 455n12, 497n73 Section 4 of, 438n6, 443n39 Condit, Carl, 120, 413n14, 445n50–51 Conference on State Defense, 217–18, 223–24, 227, 243–44, 487n8–10, 488n13, 490n30, 491n38–39, 517n31 Constitution, U.S., 50, 204, 206–207, 214, 219ff., 226, 229, 242–44, 326, 392, 408

index Compact Clause, 50–51, 58, 204, 302, 416n12, 422n9 Sixteenth Amendment, 206–207, 214, 220, 228–29 Containerport; containership; containerization, 4, 354, 374–76, 542n4, 550n54. See also Marine terminals Coolidge, Calvin, 65, 115, 174, 200, 207 Corruption, 6, 16, 31, 42, 398, 412n5,7 See also Favoritism; Patronage Cotter, C. H., 342ff. Cresson, B. F., xiii, 43, 45 Croly, Herbert, 6, 97 Culbert, Amos, 295, 297, 307 Cullman, Howard, xii, 190, 191, 228–29 and airport negotiations, 269, 272, 279, 281, 305ff. and Austin Tobin, 236–39, 256–58, 269, 279, 282, 285–89, 305, 306, 326ff., 339ff., 352, 365, 377, 530n42 and bus terminal negotiations, 321, 325–26, 339, 342, 344, 348 Cullman, Marguerite, 473n23 Curtiss, Robert, 295, 349 Daily Mirror (New York), 368 Damon, Ralph, 280, 511n86 Danahy, James, 526n17 Decision-making, “garbage can model,” 413n16 political, 10, 363 Delaware River (Ben Franklin) Bridge, 208, 450n23, 459n27 Democracy, 2, 9, 20, 23, 49–50, 95, 143, 150, 173, 230, 239, 368, 371, 429n41, 437n33 Democratic accountability. See Accountability Dewey, John, 247, 248 Dewey, Thomas E., xi, 270, 286, 287, 292, 306, 323, 330, 373, 399, 401–402, 505n41 “Dewey leases,” 311 intervenes in airport negotiations, 30813

565

on the Manhattan bus terminal, 315, 330, 335, 346, 352 on the Port Authority, 314, 349 vetoes Port Authority construction contract, 335, 346, 352 Dingell, John, 225 Disciplined oversight, 23, 371, 402 See also Accountability; Leadership Disney, Wesley, 225 Diver, Colin, 367 Dix, John, 34–35, 418n22 Dobel, Patrick, 368–72, 542n28 Doolittle, James H., 508n58 Dorsey, Frank, 258 Doughton, Robert, 225 Drinker, W. W., xiii, 122, 141–42, 147 Driscoll, Alfred E., xi, xix, 278, 281, 335, 346, 349, 352, 373, 399, 401, 521n47, 523n58, 537n99, 542n3 Drucker, Peter, 177 Dudley, John Stuart, 197 Duncan, Richard, 225–26 Dyson, Freeman, 119 Eastern Airlines, 277 fig. 12-1 (table), 280, 294 Eastman, Joseph B., 116, 184–85 Edelstein, Mortimer, 217, 224, 225, 234, 235, 238, 249–50, 251, 255–57, 260 Edge, Walter E. (1917–19), xi, 42–44, 47–48, 51, 55–61, 63–64, 69 Edge, Walter E. (1944–47), xi, 258, 271, 323 Edwards, Edward I., xi, 63–69, 95, 430n44,46, 436n31 Efficiency, 2–3, 14, 39, 42, 56, 68,121, 143, 241, 367 Port Authority as an efficient organization, 2–3, 154, 156–57, 163–64, 172–77, 181, 240, 288ff., 320ff., 336ff., 355, 361–63, 368, 385 regional efficiency, 13, 30, 34, 40, 128, 139; Port authority view of, 49, 52, 69–70, 77, 86, 93, 96, 100–102, 158, 160, 173-74, 184, 235–37, 254,

566

index

361–63, 398, railroad views on, 102–103, 114-19, 176 Eliot, T. S., 47 Elizabeth marine terminal, 394 Ellenstein, Meyer, 279–80, 283, 508n65, 511n85 and Austin Tobin, 283 fig. 11-3 (cartoon) Engineering News Record, 156, 157, 335–36, 347 Entrepreneurial leadership, 15–16, 182, 190, 193, 240, 248, 260, 272 See also Ammann, O. H., Cohen, J.C. Tobin, A. J. Environmentalism, 386 Epstein, Henry, 216, 230, 232, 483n54, 487n11, 491n39 Equity, 241, 287, 292, 305, 307 tax equity, 228–29 See also Fairness Erie Canal, xv, 32, 125 Ethical behavior, 351ff., 368ff. “Ethics of Public Service” (Bailey), 351 Evans, John, 262, 322 Experts, role of, xvii, 21–22, 55, 77–79, 141, 173, 175, 259, 263, 291, 312–13, 370 See also Progressive values Fairness, 292, 298, 299, 352, 354 “tax fairness,” 209 See also Equity Farley, Geraldine, See Tobin, Geraldine F. Favoritism, 15, 145, 158, 162ff., 188, 335ff., 347, 351, 391 See also Corruption; Patronage Federal Aviation Agency, 364 Federal Aviation Corporation, 364 Federal government, 103, 123, 183, 198, 199, 204, 206, 210, 212, 221, 228, 242, 252, 262, 362 and municipal bonds, 221, 228, 242, 362 and the Port Compact, 69

and the Port of New York Authority, 103, 183, 204, 210, 212, 252, 262, 362 See also Interstate Commerce Commission; Tax exemption; and specific agencies Federal Reserve Board, 423n11 Federal Trade Commission, 366, 423n11 Federalism, xix, 27ff., 192ff., 204, 230, 239ff. Ferguson, Frank, xii, 12, 64, 188, 189, 190–91, 222, 233, 234–36, 238–39, 250, 256–58, 262, 372, 390 anti-Semitism of, 239, 248, 256, 372, 501n24 Ferries, xv, 28, 34, 70, 84, 89, 108, 112, 123, 132, 133, 136, 161, 396, 408–409 Fielder, James F., xi, 38, 42, 64, 419n29 Fishman, Robert, xvii, 545n20 Ford, Frank R., 431n57, 464n57 Fort Lee Bridge, 130, 132, 133, 157 See also George Washington Bridge Foster, John D., 337, 532n59 Frankfurter, Felix, 484n57, 485n58 Freight terminals, 84, 90–91 fig. 4-4 (map), 96, 98, 101, 108, 109–110, 116, 118, 164, 171, 173, 174, 183–85, 190, 200, 201, 235, 289, 293, 409 Freight transportation, 79, 89, 99, 101, 105 fig. 5-1 (map), 117–19, 124–25, 128, 162, 374, 398 and public utilities concept, 405, 406–407 “rate discrimination,” 29 Frelinghuysen, Peter, 386 Fulton, Robert, 32 Galbraith, John Kenneth, 523n62 Galvin, John F., xi, 186–87, 189, 464n57, 466n67, 468n78, 472n15, 474n23 George Washington Bridge, xvii, 18, 99, 120–22, 125–42, 143–57, 161, 164, 171–72, 182, 197, 200, 222, 284, 290, 315, 376–79 dedication of, 157

index factors leading to construction, 8, 99, 155–157, 161, 171–72 as historic landmark, 450n24 impact on traffic and regional development, 4, 8, 315, 376, 377–79 See also Ammann, Othmar H. Gerhardt, Philip, 483n52 Gerhardt Case. See Helvering, Commissioner of Internal Revenue v. Gerhardt Gibbons v. Ogden, 32 Gilman, Roger, 377–78, 382, 435n16, 470n6, 494n61, 543n9, 546n24, 548n40 Giuliani, Rudolph, xii, 399, 433n7, 550n54, 553n66 Goals, of public agencies, 6–8, 14, 16–17, 79–80, 134ff., 173, 247–48, 251ff., 290, 359, 364, 370, 391, 394–95 See also Accountability; Committee on the Future; Political insulation; Port of New York Authority Goethals, George, 45, 153 Goethals Bridge, 99, 113 (5-3, map), 156, 172, 208, 397, 454n5 Goodsell, Charles, 17 Goldberg, Daniel, 211–12, 215, 216, 217, 224–25, 231, 237, 238, 243 Goldmark, Peter, xiii, 393–96, 399 and Committee on the Future, 394 Goldstein, Sidney, 211 Government Finance Officers Association (GFOA), 243 Governors, xi, 23, 41, 77, 371, 373, 380–81, 397–402, 407, 408 and creation of the Port Authority, 17– 18, 34, 38–39, 41-43, 44, 47, 48–49, 51, 55–57, 60, 61–62, 67ff., 94–96 veto power of, 49, 60, 148, 150–51, 153, 162ff., 174, 310, 371, 380, 407, 410n4, 462n45 See also Disciplined oversight; individual governors Graves v. O’Keefe, 212, 224 Great Depression, 9, 12, 98, 118, 162, 170,

567

172, 177, 181–82, 183, 185–86, 189, 193, 197, 204, 233 impact on Port Authority, 12, 98, 162, 170, 172–73 Greene, Frederick Stuart, 151–52 Greer, Raymond, 258 Gregory, Julian, 136, 137–38, 141, 189 Greyhound Bus Company, 136, 137–38, 141, 189, 233, 283, 290, 316, 318 fig. 13-1 (map), 318ff., 340, 351ff. Guggenheim, Harry F., 271, 508n58 H & M Railroad (Hudson & Manhattan Railroad) 36 fig. 2-2 (map), 383–84, 417n20, 447n6, 545n24 Hague, Frank, 22, 64, 148, 149, 163, 164, 186, 371, 430n44, 456n12,15–16, 495n67, 503n30 Hamilton, Cecile, 269 Harding, Warren G., 65, 69, 115, 174, 207, 220 Hargrove, Erwin C., 22, 173, 175 Harland Bartholomew & Associates, 263 See also Bartholomew, Harland Hastings Case, 106, 116, 441n20, 445n48 Hays, Samuel, 77, 363, 432n2 Hedden, Walter, xiii, 190, 233–34, 237–39, 241, 249–50, 251, 254, 255–56, 262–64, 268, 269, 271, 273, 278, 281, 284, 322, 329, 344, 350, 377, 434n16, 472n15, 493n54, 494n58,61, 495n63, 499n8,10,13, 500n14,18, 501n25, 534n79 Hell Gate Bridge, 18, 84, 111, 114, 116–17, 122, 123, 126, 139, 144, 158, 289, 290, 442n34, 443n35, 447n7, 448n7, 461n38,41 Helvering, Commissioner of Internal Revenue v. Gerhardt, 209, 212–13, 215, 216, 219, 220, 221, 228, 231, 240, 261, 483n52,54, 484n56,58, 485n58–59, 486n7, 487n8, 498n78 Henry Hudson Bridge, 543n6 Herald Tribune. See New York Herald Tribune

568

index

Herring, Pendleton, 9, 143, 177, 446n56 Hilgard, K. E., 447n5 Himmelfarb, Gertrude, 372 Hoboken, 4, 7, 13, 28, 29 fig. 2-1 (map), 38, 45, 78, 85, 88 fig. 4-3 (map), 90, 92, 104, 105 fig. 5-1 (map), 106, 107 fig. 5-2 (map), 109, 111, 114, 115, 123, 160, 173, 186, 191, 199, 200, 201, 235, 254, 283, 285, 292, 354, 374 Hoboken Shore Line, 104, 105 fig. 5-1 (map), 106, 107 fig. 5-2 (map), 109, 111, 114, 115, 199 Hoffman, Harold, 473n23 Holland, Clifford M., 59, 442n25 Holland Tunnel, 3, 8, 12, 18, 84, 108, 111, 112, 113 fig. 5-3 (map), 121, 122, 127, 133, 134, 135 fig. 6-1 (map), 143, 144, 146, 159, 166–67, 169ff., 172, 175, 200, 233, 261, 284, 290, 315, 339, 377, 395, 426n25, 438n4, 441n24, 442n25, 449n18, 451n31, 463n50, 466n66, 471n11 commissioners, 12, 166; and their plans for other tunnels, 108, 111–12, 134, 146, 166–67 construction of, 127, 144 factors leading to construction, 84 impact on traffic and regional development, 8, 233–34, 284, 315–16, 377 and Port Authority, 468n75–76,80, 512n100, 545n20 Port Authority takes control of, 3, 18, 166, 169–71, 197, 200 Holy Cross College, 194–96, 218, 230 Hoover, Herbert, 161, 462n43, 503n29 Hoover, J. Edgar, 367 House Ways and Means Committee, 224, 232 Hudson, C. W., 151, 458n24 Hudson, Henry, xiii, 1 Hudson County, N. J., 113 fig. 5-3 (map) and marine terminals, 87 fig. 4-3 (map) and the Port Authority, 78, 94–95,

148–50, 155, 161, 166ff., 189–90, 260, 266, 281, 283ff., 371, 398–99 See also Bayonne Bridge; Hoboken; Jersey City Hudson & Manhattan Railroad. See H & M Railroad Hudson River, xiii, xvi, 1, 9, 10, 13, 18, 28, 30, 32, 33, 34, 35, 37, 40, 41, 42, 44, 53, 55, 56, 57, 59, 60, 63, 68, 72, 80, 84, 85 86, 87 fig. 4-3 (map), 90, 95, 101, 104, 108, 110, 114, 115, 161–62, 186, 187, 188, 253 fig. 11-1 (map), 315, 375, 384, 396, 397, 403 See also George Washington Bridge; Holland Tunnel; Interstate conflict and cooperation; Lincoln Tunnel Hudson River bridges, 34, 98, 108, 109, 112 See also Fort Lee bridge; George Washington Bridge; Lindenthal Bridge Hughes, Charles Evans, 208, 231, 399, 484n56, 492n42 Hughes, Richard, 546n25, 548n39 Hulbert, Murray, 61, 62, 68, 437n33 Hylan, John F., xii, 55–56, 59ff., 66, 67, 68, 72, 81, 86, 95–96, 102–103, 112–14, 155, 165, 199, 399, 402, 423n11, 425n20, 550n54 and Al Smith, 432n6, 437n35, 553n66 and Narrows Tunnel project, 433n7, 434n12, 435n23, 443n41 and taxation of municipal bonds, 481n41 ICC. See Interstate Commerce Commission Idlewild Airport, 3, 251–53 fig. 11-1 (map), 268, 269–70, 271–73, 274–76, 279, 288, 294–96, 300, 302ff., 310, 311, 313, 328, 331, 385, 507n51, 514n12, 516n28, 517n29, 519n40–41, 520n42–43, 521n49, 522n54,57, 523n59 See also Kennedy Airport Impelliteri, Vincent, 529n41

index Independence of government organizations. See Political insulation; Entrepreneurial leadership Indian Motocycle v. United States, 477n18, 485n58 Individualism, 5, 7–8, 101, 313 Infrastructure Financing Authority, 364 Inland freight terminals, 90, 108ff., 118, 158, 171–73, 183-85, 188, 197, 200–202, 293 Insulation. See Political insulation “Integrity in the Public Service” (Dobel), 369 Internal Revenue Service. See Tax exemption: Municipal bonds and salaries Interstate conflict and cooperation, 2, 11, 27ff., 34, 40, 53, 99, 261, 401 See also Holland Tunnel; Port of New York Authority Interstate Commerce Commission (ICC), 15, 29, 38, 39–40, 41, 42–43, 44–46, 54, 60, 71, 78, 86–88, 97–98, 101, 102–103, 104–106, 109, 111, 116–18, 121, 158–60, 173–74, 184–85, 187–88, 365, 406, 422n3, 423n11, 425n17, 439n13,15, 440n18–19, 445n48,50, 446n52 Hastings decision of, 106, 116, 445n48 See also New York Harbor Case Investigation and Subpoena Act, 110–11 Investment Bankers Association, 207, 230 Jackson, Kenneth T., xv–xvii (Foreword) Jaffe, Lee K., xiii, 257–58, 262–63, 269, 277–78, 280, 322, 329, 330, 332, 333, 352, 355, 502n29, 507n55, 509n66,69, 531n52, 546n26 Jersey City, 4, 12, 28–29 fig. 2-1 (map), 34, 37, 38, 42, 56–57, 58, 63–64, 69, 70 fig. 3-1 (map), 71, 72, 78, 85, 87, 87 fig. 4-3 (map), 88, 89, 90, 91 fig. 4-4 (map), 92, 104, 105 fig. 5-1 (map), 112–13 fig. 5-3 (map), 135 fig. 6-1 (map), 144, 148, 156, 159, 160, 173, 186, 187–88, 191, 199, 235, 238, 257, 258, 287, 291, 363, 393

569

Jersey Journal, 259–60 Jones, Walter H., 343ff., 347, 535n84 Kaufman, Herbert, 173, 259, 413n20, 414n22, 438n3, 507n58, 525n11 Kean, Thomas H., xi, 396, 400 Keefe, Larry, 149, 252, 456n15, 500n18 Keller, Allan, 277, 509n69, 520n43 Kennedy, Anthony, 362 Kennedy Airport, 3, 23, 252, 362, 385, 391, 393, 397–99, 401 See also Idlewild Airport Kill, Arthur. See Arthur Kill Kill van Kull, 29 fig. 2-1 (map), 113 fig. 33 (map) King, Lyle, 375, 538n111 KLM airlines, 307 Kohl, John, 548n40 Kresky, Edward, 546n27 Kuhbach, Gerdes, 393 Kyle, John, 341–43, 344, 347, 349, 522n56, 535n84, 536n94 Labhardt, Emanuel, 450n22 La Follette, Robert, 227 LaGuardia, Fiorello H., xii, 3, 181, 182, 221, 232, 233–34, 241, 255, 268, 274, 277 fig. 12-1 (table), 292, 293, 316, 318–19, 320, 323, 325, 350, 366, 429n43, 474n28, 488n22, 493n54, 501n22, 506n46, 507n51, 514n9 LaGuardia Airport, 3, 23, 251, 252, 253 fig. 11-1 (map), 268, 269, 270–71, 272, 274, 276, 279–80, 293–96, 299, 300, 302ff., 311, 316–18, 327, 328, 376, 388–89, 395–96, 397, 516n24, 517n28, 519n40, 520n44 “LaGuardia leases,” 270, 276, 293–94, 296, 303–305 La Roe, Wilbur, 42–43 Larson, Morgan F., xi, 159, 164–65, 168, 169, 171–72, 186, 187, 462n44–45, 463n46, 465n61, 472n14, 473n23 Law, Hervey, 295, 515n16

570

index

Leadership, 14ff., 364ff. See also Entrepreneurial leadership Lehman, Herbert, xi, 182 Leone, Richard C., xii, 396–97 Lighterage system, 35, 40, 42, 45–46, 69, 84, 87–88, 91, 101, 102, 104, 106, 109, 114, 115, 158–60, 164, 187–88, 327 Lighters, 28 (definition of), 46, 96, 103, 115, 408 Lincoln Tunnel, 4, 13, 18, 121, 183, 185, 187, 189, 197, 233–34, 284, 315, 317, 318 fig. 13-1 (map), 319 fig. 13-2 (map), 331–32, 334, 339, 377, 379, 474n24, 26,28, 478n26, 509n67, 545n20, 547n31,36 second tube of, 524n3 third tube of, 530n44 Lindenthal, Gustav, 18, 82, 84–85, 94, 122ff., 136, 138–39, 142, 153, 171, 172, 448n8,11–13, 449n16 North River Bridge Company, 124, 132, 171 and Othmar Ammann, 18, 122–29, 131, 138, 153, 449n16, 451n28–29, 452n35, 453n38, 459n27, 513n5 Lindenthal Bridge, at 23rd St., 123; at 59th St., 82–85, 92, 94, 103, 108, 123–28, 130–31, 133, 135, 433n8,10, 448n9, 513n5 Link, Arthur, xvii, 8 Lowe, Donald V., xii, 258 Lukens, Matthias, 392–93, 521n51 Lutz, Harley, 219–22, 227, 488n16,17, 489n24, 491n37 McAdoo, William G., 207 McCooey, John, 425n20, 466n67, 475n3, 477n12 McCormick, Richard, 8 McCulloch v. Maryland, 204, 206, 477n18 McGoldrick, Joseph, 274, 293, 296 McGraw, Harold, 317 Mackay, William, 139, 140, 150 McKeough, Raymond, 225 McLean, Malcom [sic], 375, 543n4 McReynolds, James C., 484n56

Machiavelli, Niccolò, 247, 293, 388 Mackey, William, 160 Macleish, Archibald, xix, 4, 119, 181 Maloney, Paul, 225 Manhattan piers, 28 March, James G., 413n16 Marine terminals, 7-8, 21, 27–28, 29 fig. 21 (map), 37, 38, 53, 78, 79, 81, 84–86, 87 fig. 4-3 (map), 88, 93, 121, 159–60, 168, 191, 235, 239, 253–54, 259, 262, 266, 278, 280, 282, 291, 360 fig. 14-1 (map), 365, 372, 375, 385, 392, 394, 398, 401, 418n26, 505n41, 538n111 See also Brooklyn piers; Containerport; Elizabeth marine terminal; Newark marine terminal Marlin, George, 400–401, 552n62 Marshall, John (Chief Justice), 32, 198, 477n18, 480n33 Marshall, Robert, 536n92,94 Mass transit. See Buses; Rail transit MCS. See Merritt-Chapman & Scott Mellon, Andrew, 207 Merit, 254, 255, 336–37, 339, 401 See also Efficiency; Progressive values Merritt-Chapman & Scott, 340ff., 347, 349, 355 Mersey Docks and Harbour Board (England), 423n12 Metropolitan Defense Transport Committee, 237 Metropolitan Transportation Authority, 391, 395 Metropolitan Washington Airports Authority, 364 Meyner, Robert B., xi, 375, 380, 385, 542n3 Miller, Nathan L., xi, 65, 66, 67–69, 72, 95–96, 314, 437n34, 442n27 Milton, John, 186, 230 Mitchel, John Purroy, xii, 41–42, 55, 72, 420n37, 423n11, 425n20, 428n35, 474n23

index Moerman, Samuel, 439n16 Moisseiff, Leon, 153, 208–209, 459n27, 482n45 Monopoly power and the airlines, 4, 13, 20, 248, 288ff., 298, 311, 362 and the Port Authority, 146, 290–91, 294, 312 and steamboats, 32 Moore, A. Harry, xi, 145, 149–50, 153–55, 156, 164, 176, 186, 187, 305, 309, 455n12, 456n15–16, 458n24, 459n29, 460n34, 462n43, 465n61, 519n41 Moral Commonwealth, The (Selznick), 368 Moral reasoning. See Ethical behavior Moran, Eugene, 503n31, 528n29 Morgenthau, Henry, 217, 218, 224, 232 Morison, S. E., 5 Morrow, Dwight, 133, 136 Moses, Robert, 2, 3–4, 182, 190, 351, 367, 371, 393, 530n44, 534n67 and Austin Tobin, 17, 20, 196, 221, 248, 252, 261, 276–77, 283–84, 291–93, 296–97, 317, 319ff., 324, 326ff., 33235, 348, 352, 354, 374, 376, 378, 525n11, 529n41 cooperation with the Port Authority, 374–79, 393 and Fiorello LaGuardia, 182 “money honesty” of, 525n13 and New York City airports, 13, 160, 268, 270, 271, 276, 293–94, 295–96 and newspapers, 529n37, 531n48 and the Port Authority Bus Terminal, 252, 283, 285, 291, 316ff., 320–31, 354, 372, 527n23 and road-building, 332–33, 374, 376, 378–79 support for Greyhound Bus Company, 320ff. and urban renewal, 332–33 and William O’Dwyer, 268, 269–70, 271–72, 274, 276, 352-53, 527n19

571

and William Randolph Hearst, 544n13 Mosier, O. M., 311, 514n9, 523n60 Moskowitz, Belle, 163, 501n24 MRE (“Memorandum Regarding Events . . .”), 521n51 Mulcahy, John, 483n52 Mumford, Lewis, 316, 349, 524n1 Municipal bonds. See Tax exemption: Municipal bonds and salaries Murphy, Charles Francis, 425n20 Murphy, Vincent J., 272, 509n65 Murray, John F., 466n67 Myth (in organizations), 173ff. Narrows Tunnel, 81–82 fig. 4-1 (map), 92, 94–95, 102, 112–14, 177 National Tax Association, 230 Newark, 29 fig. 2-1 (map) Central Planning Board, 263ff. city government, 13, 20–21, 38, 78, 187–88, 237, 248, 258, 263ff., 271, 272–73, 278ff., 283, 371 as containerport, 4, 374–76 marine terminals, 4, 13, 85, 86–87 fig. 4-3 (map), 88, 92–93, 186, 255, 261, 262ff., 266, 267–68, 278, 282, 291, 374–76 and New York City, 88, 265, 284 planning in, 38, 88, 263ff., 268 and Port of New York Authority, 3–4, 7, 9, 13, 69, 78, 80, 93, 186, 187–88, 199ff., 254–55, 259, 260–61, 262–63, 264–65, 266, 267–68, 269–70, 271–72, 278ff., 282, 284–85, 286–87, 291, 296, 328, 347, 353, 371–72, 374–75, 376ff., 383, 396ff. See also Newark Airport; Port Newark Newark Airport, 3, 9, 13, 252, 253 fig. 11-1 (map), 254–55, 267, 268ff., 274, 278ff., 279–80, 282, 285, 291, 293–94, 295, 296–98, 303, 321, 328, 371–72, 379, 391, 396–97, 399–401 Newark Bay, 28–29 fig. 2-1 (map), 87 fig. 4-3 (map), 92–93

572

index

Newark Chamber of Commerce, 188 Newark Evening News, 155, 159, 269, 273, 278–80, 308, 311, 331 Newark Housing Authority, 20 Newark Legal Center, 4, 396, 400 Newark Star-Ledger, 169, 273, 279, 285, 401 New Jersey, xix, 29 fig. 2-1 (map), 70 fig. 3-1 (map), Board of Commerce and Navigation, 37–38 Chamber of Commerce, 38 governors of, xi, 6–7, 12, 18, 20, 32, 34, 42, 56 Great Swamp, and proposed airport in, 385–86, 387, 388 maritime cities in, 29 fig. 2-1 (map), 37–38, 40, 60, 87 fig. 4-3 (map), 88 and New York State, 1, 8, 10, 20, 22, 23, 26–28, 30, 32–34, 39ff., 48–49, 59, 61–62, 95, 136–37, 139–40, 149–50 newspapers in; See Bayonne Times; Bergen Evening Record; Hudson Dispatch; Newark Evening News; Newark Star-Ledger political fragmentation in, 5, 34ff., 88, 365 railroads in, xvi, 28–29, 35, 36 fig. 2-2 (map), 37–38, 40, 43, 45, 52, 63, 78, 80, 81, 83 fig. 4-2 (map), 84, 85ff., 89, 90, 93, 94, 102, 104, 105 fig. 5-1 (map), 114, 115, 119, 158–59, 187–88, 196, 281, 380, 396 terms of governors in, 430n49 New Jersey Harbor Commission, 423n12–13 New York Bay, 10, 49–50, 80, 81, 86, 90, 234, 378 New York City, xiv–xvi, 7–8, 17–18, 33, 53, 124ff., 172, 335, 348, 360 fig. 14-1 (map), 361 Airport Authority, 268ff., 276, 282, 293–95, 323, 328, 402 airports in, 251–55, 259, 261, 268, 271–72, 275-76, 277, 281–82, 291–92, 293-94, 309, 321, 397, 399

Board of Estimate, 39, 60ff., 69, 427n33, 428n40, 429n41–42 Brooklyn Chamber of Commerce, 68, 187, 204 city government, 21–22, 31, 35, 41–42, 55, 59–60, 61–63, 65–67, 68–69, 71, 95–96, 114, 261, 279–80, 317, 332, 354, 374, 387, 394, 395–96, 398–99 Department of Marine and Aviation, 273 home rule, 55, 59, 61–62, 67, 95 marine terminals, 21, 36 fig. 2-2 (map), 39, 261, 372 mayors of, xii, 23, 154, 199, 221, 325, 326, 364, 402 and Newark, N.J., 3, 7–8, 9, 13, 20-21, 23, 28, 29 fig. 2-1 (map), 33, 35, 36 fig. 2-2 (map), 37, 38–39, 42–43, 60ff., 80, 85, 88, 95, 102, 113 fig. 5-3 (map), 114, 128, 129, 131, 187, 191, 204, 248, 255, 259, 261, 265, 272, 285, 291–92, 293–94, 397 newspapers in; See Brooklyn Daily Eagle; New York Herald Tribune; New York Post; New York Times; New York World-Telegram Parking Authority, 330, 353 piers in, 21, 28, 35, 84, 85, 261, 365, 374 Planning Commission, 235, 320–26, 328–29, 352 Port and Harbor Development Commission, 44, 45, 66 Queens Chamber of Commerce, 65, 110, 187, 204 subways, 38, 384, 392, 397, 409, 417n19, 430n48, 473n21, 524n2, 544n19, 548n43 Traffic Commission, 329 zoning, 320, 330 New York Dock Company, 203, 479n31 New York harbor, 32, 73, 194, 283 See also New York Bay New York Harbor Case, 30, 41, 43, 45, 60,

index 64, 85–86, 103, 116, 117, 118, 417n12, 422n3, 434n13, 446n55 New York Herald Tribune, 268–69, 302, 308, 315, 322–23, 324, 329, 330, 349 New York, New Jersey Port and Harbor Development Commission, Joint Report, 44–45, 66, 414n1 See also Red Book New York Post, 275 fig. 11-2 (cartoon), 320, 324 New York State, xix, 36 fig. 2-2 (map), 70 fig. 3-1 (map), airports in, xvi, 3, 8, 13, 121, 251ff., 259, 261, 262–63, 266–67, 268, 271–72, 275-76, 277–78, 281–82, 291ff., 297, 309, 321, 328, 331, 340, 370–72, 394, 397–399, 402 governors of, xi, 23, 61, 95, 165–66, 241, 247, 391 Metropolitan Transportation Authority, 391, 395 and New Jersey, 1, 8, 10, 20, 22, 23, 26–28, 30, 32–34, 39–46, 48–49, 59, 61–62, 95, 136–37, 139–40, 149–50 and the Port Authority, 61–62, 95, 139–40, 149, 165–66, 167, 170, 204, 212, 216, 317, 340, 351, 362, 376 Public Service Commission, 111 railroads in, 36 fig. 2-2 (map), 79–80, 92ff., 101, 110–11, 115, 128, 160–62, 187, 191, 235, 323, 365, 396–97, 405, 408, 409 public housing in, 167 steamboats in, 32 taxes in, 225 water-power projects in, 167 See also New York City New York State Chamber of Commerce, 17, 30, 31, 34, 39–44, 55, 59, 63, 68–69, 72, 95, 96, 110, 167–68 New York Times, 43, 58, 143, 168, 419n27, 425n19, 427n31,33, 430n48 on Al Smith and Port development, 431n53, 437n35

573

on appointment of commissioners, 437n34 on Comprehensive Plan, 435n25, 436n29, 467n70 on freight congestion, 430n48 on Hudson River bridge, 461n41 on Hylan administration, 431n54, 434n12 on Hylan’s Narrows Tunnel project, 434n12 on New Jersey, 65 on New York City government, 322–23, 326 on New York State government, 385–86, 431n55 on Port Authority activities, 156, 169–70, 172, 181–82, 302, 322–23, 330, 349–50, 367–68, 370, 384–86, 393 on Robert Moses, 270 on Staten Island bridges, 460n37, 461n38 New York World-Telegram, 277, 324–25, 330 “Nonpolitical efficiency”. See Efficiency; Progressive values North Beach airport; See LaGuardia Airport North Jersey Development Plan, 85–88 Northwest Airlines 277 fig. 12-1 (table) Norton, C. McKim, 506n42 O’Brien, John P., 437n33 O’Dwyer, William, xii, 268, 269ff., 276–78, 279ff., 285, 295, 304, 323–24, 325–26, 328ff., 338, 339, 348–49, 352, 353–54 O’Hara, Clifford, 375, 445n51 Olcott, Edward S., 543n9, 546n24 Optimism, 8–10, 47–48, 72, 109ff., 124, 183, 190, 248, 306, 326, 352–53, 362, 372, 373 Outerbridge, Eugenius H., xii, 30, 42, 44–45, 51, 57, 68, 73, 99, 108, 167, 189, 365, 409, 415n6, 423n12, 426n25, 433n10, 441n24, 460n37, 464n57–58

574

index

Outerbridge Crossing, 113 fig. 5-3 (map), 156, 172, 208, 395, 454n5, 471n11, 513n5 Pallmé, William, 202–204, 210–11, 332, 417n12, 472n14, 479n28,30, 482n45, 483n50, 486n6, 494n58, 530n45 Pan American Airlines, 277 fig. 12-1 (table), 297, 306–307, 325, 515n14, 520n43 Pascoe, Herbert, 526n17 Pataki, George E., xi, 23, 210–11, 400–401, 433n7 PATH (Port Authority Trans-Hudson Corporation), 4, 384, 388–90, 391–92, 393, 395–96, 397, 398, 399, 548n38, 550n55, 553n66 Patronage, xvii, 15, 129 and insurance, 351–52 at the Port Authority, 7–8, 9, 14, 19, 21, 51, 95, 144, 146, 148, 149, 158, 162ff., 186ff., 197, 254, 255, 264–65, 274, 281, 291, 312, 316, 345, 347, 353, 368, 370, 372, 373, 375ff., 391, 397, 401 See also Corruption; Equity; Favoritism Personal integrity. See Ethical behavior Piers. See Marine terminals Pierson, Arthur, 112 Planning, 3, 8ff., 19, 23, 31, 39-40, 47ff., 51, 59, 67, 69, 76, 79, 85, 88, 97ff., 106, 108, 116, 120–21, 125, 129, 152, 161–62, 167, 173, 175, 190, 197, 219, 234, 235, 237–39, 248, 251–52, 255–57, 264–66, 267–68, 270, 278, 285–86, 289, 294, 315–17, 319–21, 324ff., 341, 349–50, 352, 359, 361–62, 370, 377, 382, 384, 387, 390, 397–98, 401, 403 See also New York City Planning Commission; Port of New York Authority; Regional Plan Association Political insulation, 22, 145, 149, 155, 162–65, 173, 291, 312–13, 361, 364, 368ff., 457n20, 523n58

See also Progressive values Pollock v. Farmers’ Loan and Trust Company, 206–207, 214, 244, 477n18, 481n38, 498n78 Pollution, 33, 40, 49, 63, 66, 82, 99, 351, 422n8, 438n5 Pope, Bayard, xii, 308–309, 330, 342, 377, 503n31, 522n56, 543n8, 553n65 Port Authority Bus Terminal, 313, 315–350, 359 Port Authority of New York and New Jersey, xix, 1, 391 See also Port of New York Authority Port Authority Trans-Hudson Corporation. See PATH Port Compact, 8, 57–58, 61–62, 63–65, 66, 67, 69–70, 73, 95, 99, 149, 159, 199, 204, 403–410 (complete text), 426n26, 431n59–60, 519n41 Port and Harbor Development Commission, 44, 45, 66, 422n3 Port of London Authority, 422n8, 423n12, 502n26 Port of New York, xv–xvi, 1, 27ff. See also New York Bay; New York harbor Port of New York Authority, 1–5, 69–73 after 1950, 373ff. after Austin J.Tobin, 391ff. airports, 160–61, 191, 239, 247–48, 251, 253 fig. 11-1 (map), 254–55, 259ff., 266, 268ff., 285, 287 bondholders of, 174, 177, 215, 229, 261, 285, 290-91, 297, 469n81, 519n38, 545n24 bridges, 18, 33, 82, 98, 108–109, 111–12, 113 fig. 5-3 (map), 121, 127, 134, 147ff. British influence on, 196, 422n8, 423n12 Bureau of Commerce, 190, 233, 235, 237, 239, 241 bus terminals, xvi, 233, 260, 289, 313, 315–17, 318 fig. 13-1 (map), 320, 321,

index 323–24, 327, 331, 348, 350, 359, 537n99, 540n8, 541n23 commissioners, xii, 9, 23, 34, 49, 51, 54, 67, 68, 71, 77, 78, 95, 104, 106, 108, 111–12, 116, 120, 121, 127, 136, 138, 142, 144–46, 147, 150, 152, 157, 159, 162ff., 181, 186, 189, 197, 200, 215, 233ff., 247, 251–52, 255ff., 267, 269ff., 278ff., 283ff., 295, 297, 299, 301, 305ff., 320, 323–24, 330, 334, 335, 338, 342ff., 352, 355, 365, 376, 378, 383, 384, 390ff., 399ff., 404, 456n17, 464n57, 465n62, 532n57, 543n8, 552n63 and Committee on the Regional Plan, 114, 136–37, 177 conflict and cooperation, 2, 27ff., 31ff., 33, 40, 41ff., 47, 50–51, 59, 61, 64, 68ff., 73, 78, 80, 94, 98–99, 100ff., 104, 110, 114, 116, 119, 125ff., 144, 145, 148, 150, 159, 163, 173–74, 183ff., 186ff., 206ff., 231ff., 239, 248, 250, 260–61, 263, 265, 272, 280, 286, 291– 93, 303, 306, 308, 309, 311, 312-13, 325, 328, 331, 363, 367ff., 371, 373, 374ff., 388ff., 398ff., 402 construction contracts, 254, 292, 320, 335ff. creation of, 1, 3, 48ff. criticisms of, 23, 93, 144–45, 149, 151ff., 167–68, 175, 187, 188, 222, 263, 267–68, 273, 284–85, 308–309, 325, 329, 347, 380, 384–85, 388, 389–90, 401, 462n44, 467n68, 472n14, 473n20, 535n89 and decentralization, 20, 78, 349 decline in quality and independence, 374ff. facilities as of 1950, 360 fig. 14-1 financial deterioration in 1930s, 185–86 financial deterioration in 1980s, 393ff. financing of programs, 126–27, 134, 137, 138, 155–56, 162, 165, 168, 170, 207, 218, 230, 242, 251, 272, 285, 309, 311–12, 353, 364, 380–82, 451n30–31

575 and free lighterage, 473n19 freight terminal, 90, 108, 109, 118, 173, 184, 190, 202, 205, 293 governors’ veto power over, 49, 60, 148, 150–51, 153, 162ff., 174, 310, 371, 380, 407, 410n4 governors and, 17–18, 34, 38–39, 41-43, 44, 47, 48–49, 51, 55–57, 60, 61–62, 67ff., 94–96, 457n21, 544n18, 553n66 growth of, to 1950, 539 highways and, 189, 207, 233, 250, 315, 337, 374, 376ff. and Holland Tunnel, 3, 18, 166ff. independence of, 2, 9, 14, 18, 49, 52, 102, 121, 148, 150–51, 164–65, 168, 260, 287, 309, 371, 400 leadership structure of, 5, 14ff., 51, 55, 82, 152, 158, 174, 176, 177, 182, 185, 193, 232ff., 248, 256–58, 277, 285–86, 292, 323, 325–26, 352, 361, 363, 364ff., 367, 391–93, 394, 397ff., 532n57 legislatures and, 49, 53, 55, 58ff., 62, 66, 79, 92–93, 99, 108, 134, 139, 204–205, 251, 334, 364, 368–69, 403, 406–408 marine terminals, 7-8, 21, 27–28, 29 fig. 2-1 (map), 37, 38, 53, 78, 79, 81, 84–86, 87 fig. 4-3 (map), 88, 93, 121, 159–60, 168, 191, 235, 239, 253–54, 259, 262, 266, 278, 280, 282, 291, 360 fig. 14-1 (map), 365, 372, 375, 385, 392, 394, 398, 401 and mass transportation, 391–92, 395; See also Buses; Rail transit and the media, 22, 148, 268, 269, 277, 301, 304, 329 as model, 363, 411n2, 540n8 New Jersey criticism of, 93, 144–45, 149, 175, 188, 267, 273, 284–85, 347, 380, 389–90, 401 New York City criticism of, 23, 144–45, 151ff., 167-68, 187, 263, 308–309, 325, 329, 347, 367–68, 384-85, 388

576

index

nonpolitical image of, 5–7, 145, 186, 291, 293, 336ff., 363, 368, 387 organizational culture of, 250, 367, 369 PATH (Port Authority Trans-Hudson Corporation), 4, 384, 388–90, 391–93, 395–96, 397, 398, 399 political skills and strategies, 8, 13, 15ff., 23, 31ff., 34ff., 42, 77ff., 121, 127, 133, 163, 175, 182, 193, 236, 248, 249, 261, 262ff., 272, 280, 281, 289–90, 292, 295, 298ff., 301, 326, 332, 334, 348, 351, 352, 357ff., 361, 362, 364, 365–66, 390, 537n105 Port Authority Trans-Hudson Corporation. See PATH Port of New York District, 70 fig. 3-1 (map) Port Planning Program, 255–56 public relations of, 132, 188, 252, 255ff., 322ff., 329ff., 511n85,87 public utility concept, 101, 103, 176, 289, 292, 296, 442n30 rail freight plan, 43, 73, 88, 91 fig. 4-4 (map), 98, 105 fig. 5-1 (map), 108, 111–12, 113, 117, 128, 136, 160, 162, 171, 183, 203, 289 and rail transit, 98, 145, 160–62, 191, 379–84, 388–90, 464n54, 474n27, 512n104, 544n15,19 railroads and, xvi, 28–29, 35, 36 fig. 2-2 (map), 38, 40, 43, 45, 52, 54, 63, 71, 73, 78, 80, 81, 83 fig. 4-2 (map), 84, 85ff., 91 fig. 4-4 (map), 95ff., 105 fig. 5-1 (map), 134, 136, 147, 158–59, 171, 175–76, 183ff., 196, 200, 281, 310, 322, 361, 363, 380, 405, 408–409, 444n44–46, 445n50–51, 446n53, 452n37, 470n8, 513n4 and regional planning, 19, 79, 95ff., 108, 234, 241, 315, 397 risk taking by, 249ff., 504n38 as “socialistic” enterprise, 158, 167 staff members of, xiii, 89, 115, 116, 160, 161, 182, 185, 187, 190, 192, 210, 213,

235, 236, 237, 241, 249, 261, 262, 265, 267, 269, 286, 299, 336, 338–39, 343, 382, 384, 392, 395, 494n59, 501n24, 534n79, 536n94, 551n58, 553n66 and State House Commission, 149–51, 163–64, 456n16, 457n19,21 state legislatures and, 49, 53, 55, 58ff., 62, 66, 79, 92–93, 99, 108, 134, 139, 204–205, 251, 334, 364, 368–69, 403, 406–408 Suburban Transit Engineering Board, 161 subpoena powers, 103, 110–11, 173 tax exemption of, 204 technical rationality, 77 tenants, evicted (relocated) by, 326, 332ff., 355, 372 training for bus terminals, 534n79 truck terminals, 3, 13, 174, 191, 233, 251, 252, 259, 260, 261, 284, 289, 292, 386 tunnels (railroad), 35, 46, 51, 71, 73, 79, 80, 90, 108–109, 124–25, 126, 174, 287, 472n16 tunnels (vehicular), 3, 9, 89, 108–109, 111, 112, 115, 126–27, 130–31, 134, 135 fig. 6-1 (map), 137–38, 166–67, 168, 173, 200, 231, 284, 289, 377, 470n5–6 World Trade Center, 4, 177, 259, 289, 374, 379, 381–83, 385, 390, 396, 398 See also Ammann, Othmar H.; Cohen, J. C.; Tax exemption; Tobin, Austin J. Port of New York, The (Condit), 120 Port of New York Authority, The (Bard), 233, 249–50, 393 Port Newark (marine facility), 21, 29 fig. 2-1 (map), 247, 265, 266, 267, 271, 281, 354, 374–75, 389, 434n12 Pounds, Lewis H., 68, 464n57 Power Broker, The. See Caro, Robert Power Game, The (Smith), 224 Pragmatism, 357 Precarious values, 192–93 See also Values

index Progressive Movement, 6, 54, 537n108 Progressive values, 8, 17, 18, 36, 96, 155, 157, 175–77, 399 See also Cohen, Julius Henry, and Progressive reform; Values Promise of American Life, The (Croly), 6, 97 “Proprietary” activities, 198, 199, 200, 204, 205, 208, 209, 212 Prudential action, 355, 370–72 Public authorities. See Authorities, public Public corporations, 229, 231 Public Finance Networks, 219, 244 Public utility concept, 101, 103, 176, 289, 292, 296 Pulaski Skyway, 471n11 Queens Chamber of Commerce, 65, 110, 187, 204 Quigel, Harvey, 334 Rail commuters. See Rail transit Rail freight plan, 43, 73, 88, 91 fig. 4-4 (map), 98, 105 fig. 5-1 (map), 108, 111–12, 113, 117, 128, 136, 160, 162, 171, 183, 203, 289 Rail transit, 98, 145, 160–62, 190–91, 234, 250, 379ff., 385, 392–93, 395–97, 464n54, 512n104, 544n15,18, 545n20, 548n44, 550n54, 553n66 See also H & M Railroad; Port Authority, railroads and; Railroads Railroads, 28–29, 35 and airports, 396–98, 401 and the governors, 38, 43, 184–85, 196, 281, 309–310, 323, 380–81, 397 and the Holland Tunnel commissioners, 168–69 and ICC, 446n52 inefficiency in, 184 in New Jersey, xvi, 28–29, 35, 36 fig. 22 (map), 37–38, 40, 43, 45, 52, 63, 78, 80, 81, 83 fig. 4-2 (map), 84, 85–88, 89, 90, 93, 94, 102, 104, 105

577

fig. 5-1 (map), 114, 115, 119, 158–59, 187ff., 196, 281, 380, 396 in New York City, 36 fig. 2-2 (map), 79–80, 92–95, 128, 160–62, 187, 191, 235, 365, 396–97 in New York State, 36 fig. 2-2 (map), 79–80, 92–95, 101, 110–11, 115, 128, 160–62, 187, 191, 235, 323, 365, 396–97, 405, 408, 409 passenger service on, 544n18 and the Port of New York Authority, xvi, 28–29, 35, 36 fig. 2-2 (map), 38, 40, 43, 45, 52, 54, 63, 71, 73, 78, 80, 81, 83 fig. 4-2 (map), 84, 85ff., 91 fig. 4-4 (map), 95ff., 105 fig. 5-1 (map), 134, 136, 147, 158–59, 171, 175–76, 183ff., 196, 200, 281, 310, 322, 361, 363, 380, 405, 408–409, 440n17, 470n8, 471n10, 513n4, 550n54 regional perspective, 41, 105, 184, 263 tunnels and, 433n7–9, 435n16 Ramsey, John, xiii, 147, 150, 152, 169, 190–91, 216, 219, 233ff., 247, 249–50, 401, 454n9, 459n31, 465n61, 471n11, 472n15, 487n11, 491n38, 493n52, 494n59–60, 496n68–69, 500n18, 501n24, 502n27 Red Book, 414n1 Reed, Stanley F., 484n56 Regional Plan Association (RPA), 114, 136–37, 177, 263, 265, 269, 276, 325, 507n54, 553n66 Regional Transportation Authority (RTA), 553n66 Reilly, Paul, 202 Reimer, Rudolph, 473n20 Relocation/eviction of tenants: by Robert Moses, 332–33; by Port Authority, 320, 332–35 Republican Program Committee, 226 Revell, Keith, 445n50 Revenue Act, 206, 228, 242 Rice, Schuyler, 464n57

578

index

Rickenbacker, Eddie, 274, 290, 292–93, 294, 297, 300, 304, 307–308, 510n71, 511n86, 514n9, 515n19 Rickover, Admiral, 457n20 Riker, William, 259, 262, 272, 281, 365 Ritter, Wilhelm, 447n6, 450n22 Robertson, A. Willis, 225 Rockefeller, David, 382, 546n27 Rockefeller, Laurence S., 508n58 Rockefeller, Nelson A., xi, 247, 380, 383–84, 390–92, 393, 399, 546n27 Roebling Company, 149, 151, 154, 459n31, 461n39 Ronan, William, xii, 390, 391, 393–94, 548n43 Roosevelt, Eleanor, 181, 182 Roosevelt, Franklin D., xi conflict with Port Authority, 146, 166–67, 170, 182, 207ff. and George Washington Bridge, 143, 172, 497n72, 501n24 support for the Port Authority, 2, 12, 30, 143, 168, 169, 171–72, 184 and railroads, 184–85 on tax exemption, 4, 12, 18, 193, 207ff., 212–13, 216, 218–20, 221–22, 224ff., 228ff., 232, 240ff., 298 Roosevelt, Theodore, 6, 196 RPA. See Regional Plan Association Sagner, Alan, xii, 394 Salaries and tax exemption. See Tax exemption Sanders, Marion K., 234, 501n24 Savino, Guy, 468n75, 505n40, 541n22 Schumpeter, Joseph, 19, 248, 354, 366, 373, 374 Scientific management, 39, 98 Sea-Land, 375–76 Securities, 150, 185, 207–208, 214–15, 219–20, 222, 224, 227, 228–29, 232, 242, 290, 304 See also Tax exemption: Municipal bonds and salaries

Selznick, Philip, 175, 177, 286, 368–70, 541n24 on creative leadership, 469n90 on institutional integrity, 475n2 on organization vs. institution, 499n3 Shamberg, Alexander, xii, 228–29, 468n75, 492n42, 497n75 Shamberg Case, Commissioner of Internal Revenue Service v. Shamberg’s Estate, 229, 231–32, 242, 261, 491n41, 492n42, 495n64, 497n75 Shelley, Leander, 203, 237–38, 239, 472n12, 487n9,11, 495n64, 496n68,71, 512n99, 521n48 Shipping, innovations in, 374–76 See also Containerport; Containership; Containerization Shulhof, Otto, 163–164, 464n57, 465n59 Silzer, George S., xi, xii, 18, 108–109, 112, 122, 129ff., 142, 144, 147–49, 153, 166, 174, 189, 399, 442n27, 448n15, 449n16,19, 451n27–28,30, 452n31, 453n3,38,41, 464n57 Skehan, Rosaleen, 329 Smith, Alfred E., xi, xii, 17, 415n4,9, 425n21, 462n43 and John F. Hylan, 81–82, 95, 112–14, 432n6, 437n35, 553n66 and Julius Henry Cohen, 30, 56ff., 65–69, 161–66 and the Port Authority, 56ff., 63, 65–69, 71–72, 95, 108–110, 112, 114, 122, 134, 144–46, 149–53, 158, 161–66, 168, 174, 196, 236, 373, 399–400, 402, 451n31, 456n17, 457n21, 466n63,65,67 Smith, C. R., 292, 297, 300, 308, 309, 310, 313, 514n9, 515n19 Smith, Hedrick, 224 Smith, J. Spencer, 44, 420n44, 431n57, 464n57 South Carolina v. United States, 477n19, 497n75 Spargo, George, 378

index Spoils system. See Patronage Staten Island bridges, 18, 98, 99, 111–12, 113 fig. 5-3 (map), 120–21, 129, 137, 139–40, 141, 144, 146, 147–48, 152, 155–56, 164, 186, 196, 200, 208, 222, 290, 376, 378, 395, 453n41, 459n28, 460n36–37, 461n38, 471n11, 509n67, 543n6 Staten Island piers, 35 Star-Ledger (Newark), 169, 273, 279, 285, 401 State Transit Commission, 67 Stephens, Mallory, 340ff., 345–47, 351–52, 354-55, 526n17, 534n67, 535n84,86,91 Stillman, Paul, 553n65 Stone, Harlan Fiske, 212, 215–16, 231, 484n56,58, 485n58, 486n7, 487n8, 492n48 Stratocruiser, 299, 306–307, 308, 313 Strauss, Joseph, 153–54, 155, 176, 459n29–30 Tammany Hall, 17, 31, 55–56, 163, 371, 415n8–9, 425n20–21, 427n33–34, 431n54, 437n35, 474n23 and city engineers, 448n13 Taxation, 198, 202, 203, 207, 210, 213, 215, 217, 221, 224, 230–31, 240, 243, 300, 477n18, 480n33–37 immunity from, 205ff., 212–13, 214–15, 230-31, 240 and power, 480n33 state and local issues, 199–200 Tax exemption: Municipal bonds and salaries, 198ff., 206ff. of bridges and tunnels, 478n26 Conference on State Defense and, 217, 218, 223, 224, 227–28, 243–44 conflicts on taxing salaries, 198, 205, 206–208, 209ff., 214–16, 219–220, 223–24, 228 Congressional strategies used by Tobin and his allies, 193, 214ff., 219–21, 224ff., 228ff., 232ff., 237ff., 242–43 Constitution and, 204, 206–207, 214, 219–20, 221, 222, 226, 229, 242–44,

579

480n32–34, 481n38–40, 482n47, 486n7, 493n50 “essential”/”proprietary” distinction, 198, 199–200, 204, 205, 208–209, 212 Franklin D. Roosevelt’s views on, 209ff., 220, 240-41 immunity issues, 205ff., 212–13, 214–15, 230–31, 240 legal strategies used by the Administration and by Tobin and his allies, 182, 193, 199, 214ff., 219–21, 224ff., 228ff., 232ff., 237ff., 242–43 of Port of New York Authority, 478n26, 482n47 retroactive taxation, 217 Special Committee on Taxation of Government Securities and Salaries, 219–220, 222–23, 227 of state agencies, 477n19, 486n8 Treasury view on tax exemption, 192, 207ff., 212ff., 217ff., 228ff., 242–43 Taylor, Frank, 509n67 Teamsters’ Union, 353 Tenants, relocated (evicted); See Relocation/eviction Tennessee Valley Authority (TVA), xvi, 1, 2, 12, 20, 22, 30, 241 Teterboro Airport, 3, 292, 303–304, 518n35–37 Thomas, Norman, 488n14 Throgs Neck Bridge, 18, 376, 379 Tobin, Austin J., xiii, xvi, 12–13 and airline officials, 271, 274–75, 276, 281, 287, 290, 292, 293, 295, 297–98, 299, 300–301, 303, 307, 309-11, 521n48, 523n60 and airports, 247ff., 288ff. and anti-Semitism, 12, 19, 239, 248, 257, 372 biography, 12–13, 18, 193, 194ff. and bus-terminal project, 315ff. and Catholic Church, 194–95, 286–87, 475n4, 477n13, 512n103

580

index

children of, 477n15, 483n50, 494n61, 496n68 coalition-building skills, 193, 216–18, 281, 391 combative style, 248, 387 death of, 390 early life of, 18, 193, 194ff., 475n4,6, 476n7–10 and ethical action, 19–20, 292, 316, 333–35, 350ff., 359ff., 372 as executive director, xvi, 12, 17, 18, 139, 193, 242, 256, 272, 305 experts, use of, 218, 219, 222, 248, 259, 275, 288, 291, 294, 312, 313, 370, 387 and Eugene Black, 495n66 and favoritism, 335–39, 347, 351–52 and favoritism on bus terminal contracts, 340–47, 355 and Frank Ferguson, 12, 222, 233, 234–35, 238–39, 250, 256–58, 262, 372, 390, 501n25 and Geraldine Farley Tobin, 196, 211, 475n4, 476n10,11 and Howard Cullman, 236–39, 256–58, 269, 279, 282, 285, 286, 287, 289, 305, 306, 326ff., 339, 342, 344, 348, 352, 365, 377, 530n42 impact of, 20ff., 218ff., 221, 239, 311, 371–72, 374, 380, 385–86, 386–87, 391, 392–93 and James Danahy, 526n17 joins Port Authority, 18, 193, 197ff. and Julius Henry Cohen, xvi, 17, 19, 196, 197ff., 203ff., 206ff., 209ff., 214–16, 219, 223, fig. 10-1 (cartoon), 232, 237ff., 362, 365, 370–71 leadership strategies, 13, 193, 209ff., 229–30, 248, 253, 256, 258ff., 262ff., 273, 285 leadership, preparation for, 193, 196, 197ff. and Leander Shelley, 496n68 and Lee K. Jaffe, xiii, 257–58, 263, 265,

269, 277–78, 280, 322, 329–30, 332–33, 352, 355 legal battles of, 193, 197, 203ff., 206ff., 209ff., 214ff., 218ff., 224ff., 228ff. and local officials, 13, 201, 207, 229 and Meyer Ellenstein, 279–80, 283 fig. 11-3 (cartoon) motivation and values of, 12, 17, 18–20, 192–93, 217, 218, 241, 248, 386–88, 483n50 optimism of, 326, 352–53, 362, 372, 373, 477n13, 516n25 and Port Authority commissioners, 238–39, 247, 250–51, 252, 255, 256–57, 269–70, 285–87, 295, 296, 299, 301, 305–307, 308–309, 344, 346, 352, 354–55, 365, 376, 378, 383, 384, 390, 392–93 and Port Authority staff, 211, 247–48, 286, 336–37, 339 and the press, 239, 252, 256, 257, 262–63, 268–69, 277, 286, 307–308, 374 and public-relations strategy, 253, 257, 262–63, 269, 280–81 resigns from the Port Authority, 372, 390 and Robert Moses, 17, 20, 196, 221, 248, 252, 261, 276–77, 283–84, 291, 293, 296–97, 317, 319ff., 324, 326ff., 332–33, 334–35, 348, 352, 354, 374, 376, 378, 525n11, 529n41 and tax-exempt bond fight, 193, 203ff., 209ff., 218ff., 224ff., 228ff., 239ff., 486n8, 487n9,11, 488n20, 489n25,28, 490n30, 491n38–39, 492n43 use of experts, 499n12 and Walter Hedden, 233, 234, 237–39, 249–51, 254, 255–56, 262, 264, 268, 269, 271, 278, 281, 284, 344 weekly reports of, 257, 509n67 willingness to share credit, 512n99 See also Edelstein, Mortimer; Goldberg, Daniel; Tax exemption: Municipal bonds and salaries

index Tobin, Austin J., Jr., 447n15, 483n50, 496n68 Tobin, Clarence, 194, 203, 475n3–4, 483n54 Tobin, Geraldine Farley, 196, 211, 475n4, 476n11 Tobin Plaza (Austin J.), 390 Tompkins, Calvin, 35 Transportation; See Airports; Bridges; Marine terminals; Railroads; Truck terminals; Tunnels Transportation Act (1920), 103, 106, 116, 441n20 Trans World Airlines, 296, 297 table 12.1 Treaty of 1834. See Compact of 1834 Triborough Bridge and Tunnel Authority, 18, 332, 376, 378, 393, 543n6, 543n13, 549n46 Trippe, Juan, 277, 287, 292, 293, 298, 304, 307–308, 309–10, 313, 515n14,19 Truck terminals, 3, 13, 174, 191, 233, 251, 252, 259, 260, 261, 284, 289, 292, 321, 353, 388, 435n17,22, 474n28, 512n95, 538n109 Tunnels, xvi, xvii, 13, 35, 41, 57, 119, 120–21, 133, 145–46, 166, 181–82, 188, 190, 200–201, 210, 233–34, 235–36, 239, 247, 249, 260, 270, 273–74, 282, 285, 290, 293, 311, 315, 321, 359, 360 fig. 14-1 (map), 361, 370, 377, 392–93, 396–97, 408–409, 466n66, 467n73, 484n55, 509n67, 544n16, 553n66 private corporations, 134–36, 290 rail, 35, 46, 53, 56–57, 71, 73, 80, 81–82 fig. 4-1 (map), 90, 92, 94, 97, 102– 103, 112, 114, 115, 121, 124–25, 174, 234, 250, 289, 435n16, 509n67 vehicular, 3, 6, 19, 22, 32, 34–35, 58–59, 89, 90, 108–109, 111, 113 fig. 5-3 (map), 122, 126, 127, 130–31, 133–34, 135 fig. 6-1 (map), 136, 138, 140, 144, 146, 166ff., 171–73, 183, 185, 187, 260, 377, 435n17, 441n24, 447n6, 449n18, 545n20

581

See also Holland Tunnel; Lincoln Tunnel Tuomey, Douglas, 334 Turner Construction Company, 335, 340, 342, 343, 346, 347, 535n84,88, 536n92–94 Tuttle, Robert, 297, 303, 311–13, 514n9, 515n19 Twitchell, Herbert, 464n57, 466n67 United Airlines, 274, 290, 293 United States Chamber of Commerce, 207 United States Conference of Mayors, 218, 221, 243 United States Constitution. See Constitution, U.S. Values American, 2, 386–87, 412n9 precarious, 192–93 Progressive, 8, 100, 155, 157, 175–77, 399 rational-legal, 8, 412n12 Van Buskirk, DeWitt, 431n57, 440n18, 464n57 Verrazano, Giovanni da, xv Verrazano-Narrows Bridge, xvii, 18, 376–79 Veto power; See Governors: veto power of Waddell, J. A. L., 141, 147 Waddell & Hardesty, 141, 147, 443n39, 454n5, 455n10 Wagner, Robert F., 257, 501n24 Wagner, Robert F., Jr., xii, 538n110 Walker, James J., 114, 432n6 Walsh, Annmarie, 23, 338–39, 411n2 Walsh, Arthur, 257–58 Wall Street Journal, 304 War Department (U.S.) and Hoboken Railroad, 97, 444n44 Warren, Earl, 226 Weehawken, 87 fig. 403 (map) Weekly Report (by A.J. Tobin), 257 Wehran, Fred, 518n36

582

index

Whiteside, George, 305, 306–307, 515n21, 519n41, 520n42–43, 521n49 Whitman, Charles S., xi, xii, 40, 43, 44, 51, 55–56, 69, 420n42, 425n18, 428n35, 509n67, 552n62 Whitman, Christine Todd, xi, 400–402, 552n62–63 Wicks, Arthur, 526n17 Wiebe, Robert, 312 Wiley, John, 385, 515n20, 516n23, 532n56 Wilgus, William, 81, 435n23, 443n41 Willcox, William, 44–45, 409 Wilson, Billings, 190, 203, 236, 237–39, 249, 464n52, 472n15, 474n25, 483n52, 496n68,70 Wilson, James Q., 364–67

Wilson, Malcolm, xi, 392 Wilson, Woodrow, xi, xvii, 6–7, 14–15, 34–35, 38, 45, 54, 129, 196, 207, 218, 361–62, 402, 412n5,7–8, 418n22, 422n5, 423n11, 425n17, 428n35 on administration and politics, 54, 361, 460n35 Wisehart, M. K., 460n37 Wood, David, 487n11 World Telegram. See New York WorldTelegram World Trade Center, 4, 177, 259, 289, 374, 379, 381–83, 385, 390, 396, 398 World Trade Corporation, 282 Yamasaki, Minoru, 546n27