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       Pittsburgh’s New Partnership

      Pennsylvania governor Milton Shapp had been right to be concerned about the effects of Nixon’s revenue-sharing programs on the fiscal health of Pennsylvania’s cities: the amount of revenue shared was not enough to meet the needs of state or local governments. The Nixon administration had structured general revenue sharing such that booming southern and western states received more federal funds than did cash-strapped northern industrial states.⁶ After revenue sharing went into effect, Shapp sought to make up budget shortfalls by raising state taxes. He tried to secure support for tax hikes at the local level by promising mayors that he would increase state funding for cities. Flaherty’s response must have come as something of a shock to a New Deal liberal like Shapp: Flaherty told him to keep the money and maintain tax rates.⁷ When Flaherty took office in 1970, Pittsburgh’s seminal postwar urban renewal program had just wound down. Between 1965 and 1968, Pittsburgh had received over $100 million in federal grants-in-aid, an average of slightly more than $25 million a year. Pittsburgh’s debt burden was up in 1970, but city planners predicted that the federal funds they expected to receive, along with anticipated new private investment, ensured a rosy fiscal outlook into 1975.⁸ The planners did not account for funding changes under Nixon’s revenue-sharing proposals, and, between 1970 and 1977, the year Flaherty left office, the federal government slashed the amount of aid it sent to Pittsburgh by a third.⁹ Flaherty took up the challenge of a reduced city budget and greater debt by implementing austerity policies, eliminating public-sector jobs, and reducing some city services.

      Unlike his Democratic predecessors, who were beholden to both the Allegheny Conference and the unions, Flaherty demonstrated a concern for the outsized influence of interest group politics that made him more like Jimmy Carter than like Lyndon Johnson. Former city planning director Morton Coleman recalled with some understatement that Flaherty “was not a big government person.”¹⁰ He was the first of a new breed of fiscal populists who emerged in the 1970s: liberal Democrats who embraced economic conservatism when faced with tax revolts and urban financial crises.¹¹ Democratic mayors like Flaherty and, later, Ed Koch in New York City, Diane Feinstein in San Francisco, and William Green in Philadelphia rejected the political legacy of the declining New Deal coalition and promoted instead new modes of governance that they saw as more consistent with their limited resources and emerging middle-class resistance to tax increases. Presaging the centrist New Democrats who seized control of the Democratic National Committee in the mid-1980s, these mayors remained socially liberal even as they attacked the large-scale social programs of their Democratic predecessors. Instead, Flaherty and mayors like him focused on government efficiency—often at the expense of public employees’ unions—and sought to placate welfare advocates and African American activists with symbolic but inexpensive programs and appointments of women and minorities to prominent positions.¹²

      Pittsburgh’s well-oiled Democratic machine had never encountered the likes of Flaherty. Between World War II and 1970, Pittsburgh’s mayors (with the exception of Flaherty) were hand-selected by the Democratic Party. After four years on city council and a close relationship with party leaders, Flaherty rejected first an invitation to be Mayor Joseph Barr’s handpicked successor, beholden to the party for campaign money, and a subsequent effort by Allegheny Conference members to lure him onto the Republican ticket. He campaigned instead as an unendorsed, independent Democrat and beat the machine candidate in the Democratic primary; in the general election, he ran on the platform that he was “nobody’s boy.” He financed his campaign through donations, launched innovative billboard and newspaper advertising campaigns, and won handily. Four years later, after alienating the Democratic Party, organized labor, his predecessor, most of the city council, the police, the firefighters, corporate CEOs, African American leaders, and both of the city’s major newspapers, Flaherty ran unopposed for a second term, having secured both the Republican and Democratic nominations. The joke around town was that “nobody likes Pete except the voters.”¹³

      Pittsburgh experienced problems common to North Atlantic manufacturing centers earlier and more acutely than other cities, and Flaherty’s focus on government efficiency and the austerity programs he implemented prefigured the more severe policies put in place in the middle of the decade in New York City. Flaherty eliminated a wage tax (which was later reinstated) and cut property taxes three times. He removed 18 percent of the nonuniformed workforce (nearly 2,000 workers) from the city payroll, largely through attrition and departmental reorganization. He fired Democratic Party officials from their longtime patronage positions and replaced them with young department heads tasked with increasing government efficiency. He was openly scornful of city council and saw no reason to respond to interview requests from journalists. He eliminated chauffeurs for city department heads; when Teamsters leader and city councilor Thomas Fagan challenged Flaherty’s decision, public opinion was firmly on Flaherty’s side.¹⁴ Flaherty improved some city services while allowing Pittsburgh’s aging infrastructure to collapse; he infuriated county officials, the Democratic Party, and the business community by blocking an unmanned light rail from downtown to the South Hills; and he severed the carefully nurtured relationship between city hall and the business community. At a time when other cities (New York, Cleveland) faced bankruptcy, Pittsburgh had a budget surplus.

      Pittsburgh’s political and economic elites interpreted Flaherty’s campaign slogan, “nobody’s boy,” as a rebuke not only to the Democratic machine but also to the Allegheny Conference, its Republican members, and the Mellon family in particular, whom Flaherty believed had too much influence over local politics and urban development. He brought in a new city planning director from Philadelphia, Bob Paternoster, rather than appoint someone from within the existing ranks.¹⁵ He reassigned some Urban Redevelopment Authority (URA) staffers to the City Planning Department and imposed a series of professional indignities, such as mandatory Friday afternoon meetings, on those who remained.¹⁶ Not long after Flaherty took office, he evicted the Allegheny Conference from the URA-owned Civic Building, where city planning and the URA also kept offices. Flaherty cancelled the lease and gave the Allegheny Conference sixty days to clear out; Executive Director Robert Pease described the move as part of Flaherty’s strategy, in concert with appointing new heads of planning and the URA, to restrict the Allegheny Conference’s influence over public agencies.¹⁷

      The URA, in particular, raised Flaherty’s hackles. Established to implement urban renewal programs, the URA from the outset carried out public undertakings (such as seizing property through eminent domain) in support of privately planned renewal schemes, typically at the behest of the Allegheny Conference. By 1970, the URA’s loyalties were divided between the Allegheny Conference and the Pennsylvania Department of Transportation. Flaherty saw the funds funneled through the URA as a mechanism for the state to foist the social consequences of highway construction on the city and was suspicious of the continued close relationship between that agency and the Allegheny Conference. “So we had to kind of change the position of the URA and a lot of the people, and change the people in Planning Department,” Flaherty recalled.¹⁸

      Flaherty appointed his executive secretary Bruce Campbell head of the URA and replaced the corporate elites who had dominated the URA’s board since the agency’s inception with what he described as a mix of “downtown, political, and neighborhood people.” Jack Robin, long-time Democratic political boss and chairman of the URA first under Mayor David Lawrence and again under Flaherty’s successor Richard Caliguiri, accused Flaherty of trying to destroy the agency. In Robin’s recollection, Flaherty came to office “thinking that we were all engaged in some terrific conspiracy.”¹⁹ Flaherty and Campbell “did their best,” Robin charged, “to denigrate, to loot and remove the powers of the Authority.” Pease remembered that mayors traditionally attended Allegheny Conference meetings and stopped by to “just talk,” but Flaherty delegated that responsibility to Campbell. When Pease asked Campbell to tell Flaherty to let the Allegheny Conference know if he needed anything, Campbell scoffed, “He’ll never call you.”²⁰

      The success of Flaherty’s attack on the URA and the Allegheny Conference rested in part on residents’ widespread dissatisfaction with the redevelopment partnership at the heart of the Pittsburgh Renaissance.²¹ While

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