In March 1986, over seventy workers from Baltimore's Urban Services Agency marched on City Hall to protest a decision by their agency's head to lay off twenty-one employees of neighborhood centers. The layoffs followed a series of cuts that had already shrunk the agency's staff by two-thirds in five years. The March layoffs were particularly poignant, however. Most of those who lost their jobs were African-American women who were veterans of the city's War on Poverty. They were low-level direct service providers, and many had grown up in the communities in which they worked. During their demonstration at City Hall, the workers expressed concern about their uncertain futures and those of their clients. As one woman explained about the program in which she worked, “We handle families that have multiple problems such as eviction proceedings, lack of food, truancy among young people, teenage pregnancy a whole host of difficulties… I don't know what some of our clients are going to do once we close the cases.”Footnote ¹ The job losses at the Urban Services Agency resulted from federal-level spending cuts on antipoverty measures that were frequent during the 1980s. The cuts epitomized a transformation in the way federal officials chose to respond to urban poverty in the United States. The change began during the late 1960s, and over two decades considerably worsened the urban crisis in Baltimore.

Historians and social scientists locate the origins of the urban crisis in the structural transformations of the postwar national economy. They argue that the massive deindustrialization of the nation's old industrial core has stripped inner cities of the dependable, well-paying jobs that once sustained African-American families and communities. The result has been widespread unemployment, particularly among men.Footnote ² While the economic roots of the urban crisis are clear, in this article I focus on political decisions that intensified the crisis. I argue that, in response to the waning hegemony of the United States in the global economy as well as a domestic corporate crisis of profitability, US presidents during the 1970s and 1980s adopted urban policies increasingly shaped by macroeconomic agendas that prioritized the revitalization of American economic dominance. By the late 1970s, US urban policies reflected the federal government's commitment to privatization as the most effective remedy for the nation's faltering economic status. As the scholar Brendan Martin explains, privatization includes not only the transfer of functions once performed by the government to the private sector, but also a host of policies such as spending cuts and deregulation that change “the role, responsibilities, priorities and authority of the state.”Footnote ³ The transformation in federal urban policy and privatization initiatives during the 1970s and 1980s worsened the urban crisis in Baltimore by gradually undermining the ability of Baltimore's residents, especially those with low incomes and African Americans, to influence decisionmaking that impacted their city. Simultaneously, urban policies compelled Baltimore's officials to link the city's future to the profit-making potential of its business community at the expense of efforts to combat poverty. Finally, significant cuts in federal assistance to cities and to poor people required Baltimore officials to shrink the workforce of the municipal government and reduce city services. The job losses took a particular toll on African-American women who made up the majority of the workers in the city's health, education, and welfare agencies, where cuts were targeted. The reductions in city services and federal welfare spending also disproportionately impacted women, who bore gendered responsibilities for family caretaking. Women were forced to provide for themselves or find alternative sources of services that had previously been available from the state.

During the years following the Second World War, civil rights leaders in Baltimore targeted the public sector as part of a larger campaign to open job opportunities for African Americans. In 1950, Baltimore was a Jim Crow city with a population of close to a million, but the state of Maryland had never legally disenfranchised African Americans, enabling black leaders to use political pressure in pursuit of civil rights. Between 1950 and 1960, the black population in the city grew from twenty-four to thirty-five percent.Footnote ⁴ Black leaders used their community's growing clout, as well as support from labor, religious, and civic groups, to win passage of a fair-employment ordinance in 1956.Footnote ⁵ The law created an Equal Employment Opportunity Commission, and civil rights leaders such as Juanita Mitchell of the National Association for the Advancement of Colored People lost no time before pressing the Commission to use the ordinance to police hiring in the city government itself.Footnote ⁶ Thereafter, monitoring public-sector employment became an ongoing civil rights priority.

The efforts by activists to win public-sector jobs for African Americans in Baltimore received a boost from the federal government during the early 1960s. After eight years of Republican rule, the victory of John F. Kennedy brought a Democrat into the White House. During the New Deal era, the Democratic Party had become largely beholden to and as a result often the champion of urban America. One of the ways that Democrats redistributed national wealth to their urban constituents was through intergovernmental aid. They created categorical grants, for which local officials and agency administrators could apply in order to receive federal aid for specific uses determined by Congress. Although Republicans attempted to redirect national resources to their constituents during the Eisenhower years, Kennedy's victory in 1960 suggested that the volume of grants to cities might increase again. They did. During his administration and then under President Lyndon Johnson, categorical grants, including programs earmarked for antipoverty initiatives aimed at African-American inner-city residents, rose dramatically.Footnote ⁷

The willingness of Kennedy and Johnson to invest federal resources in antipoverty initiatives stemmed in part from the faith their economic advisors placed in Keynesian economics. The advisors believed that government spending injected at the bottom of the economic ladder could help to eliminate social problems while simultaneously stimulating national economic growth. During the mid-twentieth century, many leaders of capitalist nations shared the American presidents' confidence in Keynesianism. In fact, the rules of the global capitalist economic system created in the wake of the Second World War reflected the popularity of Keynesian ideas. In 1944, representatives of over forty countries had met in Bretton Woods, New Hampshire to devise a way to resuscitate global free trade. The Bretton Woods Agreement linked the currencies of signatory nations through a system of exchange rates tied to the dollar, which was pegged to a fixed value of gold. With the US currency at the heart of the system, American firms had significant competitive advantages. The system also created benefits for other major capitalist countries, however. Fixed exchange rates protected them from disabling currency fluctuations. Further, the system allowed leaders to reintegrate their economies globally but also gave them the independence to respond to internal problems with a measure of economic planning.Footnote ⁸

As the Kennedy and Johnson administration adopted Keynesian-inspired responses to American poverty during the 1960s, the public sector in the US expanded accordingly. In Baltimore, African Americans won many of the new jobs.Footnote ⁹ In some cases, federal policies all but ensured that African Americans serve in the new jobs. Maximum-feasible-participation mandates compelled cities to give residents with low incomes a role in implementing antipoverty initiatives, and despite fierce resistance by local officials to relinquishing administrative power, programs aimed at African-American communities generally had largely black leadership and staffs.Footnote ¹⁰ Meanwhile, civil rights activists maintained pressure on city officials to hire black workers in all departments.Footnote ¹¹ They also demanded that the city government overhaul its civil service procedures to eliminate racial bias in testing and other hiring procedures, a task the city began during the late 1960s.Footnote ¹² Meanwhile, anger that white suburbanites held many of the city's highest-paying jobs led city activists to press officials to limit eligibility for municipal jobs to Baltimore residents. In one notable victory in 1969, the City Council passed an ordinance that extended preference to city residents in hiring decisions.Footnote ¹³ As the result of the ongoing pressure, between 1964 and 1970, the percentage of African Americans in the municipal government's workforce rose from twenty-six to forty.Footnote ¹⁴

As the number of African Americans in the city government rose, black workers gained increased control over municipal public policy in human services agencies. Because African Americans were underrepresented on the City Council due to earlier gerrymandering by white officials, the job gains were particularly important. Human services agencies became an important source of African-American influence within the city government. And because they filled many of the new jobs in the agencies, black women were particularly well-positioned to use the new space within the state in an effort to direct the course of public policy. Women such as Elva Edwards in the Model Cities program and Maude Harvey in the Department of Social Services were members of an army of African-American human-services employees who, during the 1960s, 1970s and 1980s, would vie to shape the city's welfare state.

Even as they increased African Americans' influence over policy, however, government jobs did not guarantee a living wage. This is one reason why black workers were among the city employees receptive to overtures by organizers of the American Federation of State, County and Municipal Employees (AFSCME), perhaps the most vibrant union in the nation in the 1960s. AFSCME leaders as well as those from other public employee unions and organizations pressed Baltimore officials to grant city workers collective bargaining rights. Sadly, it took the assassination of Dr. Martin Luther King, Jr., who was killed while in Memphis supporting a strike by AFSCME-affiliated municipal workers, before Baltimore officials finally conceded.Footnote ¹⁵ Thereafter, public-union leaders and members fought to make public-sector jobs an important source of income and stability for many African-American families.

Intergovernmental aid, meanwhile, became an increasingly vital source of revenue in Baltimore, where deindustrialization and white flight were ravaging the city's economy. Between 1955 and 1965, 338 manufacturing firms left the city, and by 1970 the city had lost tens of thousands of jobs.Footnote ¹⁶ Between 1950 and 1960, the number of white residents in Baltimore dropped by over 113,000, and the exodus continued during the 1960s and 1970s.Footnote ¹⁷ As the city's manufacturing sector and population declined so too did its tax base. Unlike most cities in the United States, Baltimore was not located within a county but was instead its own independent jurisdiction. The city did not receive tax revenue from those who moved to its suburbs. As a result, Baltimore's dependence on outside sources of revenue grew.

Intergovernmental aid was an unstable foundation on which to build a municipal economy, however. Its dependence on federal funds made Baltimore and its government workforce vulnerable not only to the shifting moods of the national electorate but also to assertions of corporate power over federal policymaking. During the mid-twentieth century, corporate America had largely tolerated the hard-won US welfare state. Considerable corporate income depended on domestic consumption bolstered by Keynesian policies that strengthened consumer power. But during the 1960s, increasing competition from Germany and Japan began undermining American corporate profitability. In response, corporate tolerance of welfare spending began to decline.Footnote ¹⁸

The shift began as the global economic system created in Bretton Woods verged on the brink of collapse. The system had been vulnerable almost from the start. By 1958, when the system of currency convertibility came into full effect, the fixed value of the dollars in circulation outside the US exceeded the value of gold in American reserves. Overseas postwar spending by the US government and American corporations and tourists had sent large quantities of dollars out of the country. As a result, the US balance of payments was in such deficit that presidents Eisenhower and Kennedy both had to fend off potential rushes on the US gold reserves. Massive spending on the Vietnam War and appropriations for Johnson's Great Society programs exacerbated inflation at home and worsened the nation's balance of payments deficit, further threatening the monetary system. Another run on the dollar occurred in March 1968. Johnson barely contained the crisis by cutting spending on the war and social programs and by limiting dollar convertibility to foreign governments.Footnote ¹⁹

Johnson left the economic disaster for Richard Nixon to handle. The new president targeted inflation as his first attempt to stabilize the dollar. His efforts to constrain both spending and the money supply failed to adequately control rising prices. They did, however, bring on a recession that cost Republicans congressional seats during the 1970 midterm elections. Thereafter, with his own reelection campaign to consider, Nixon abandoned his earlier strategy, unwilling to pay in votes for fiscal and monetary austerity. Events in 1971, however, forced him to confront the dollar's vulnerability. His policy reversals had reopened the flow of US currency overseas, eventually triggering a panic in foreign exchange markets. The report of an imminent run on gold led the president to abandon all pretense of international solidarity. Astounding the nation's trading partners, Nixon suspended gold convertibility, a step his administration, influenced by conservative economic advisors, later made permanent. In place of the gold standard, the administration advocated a system of floating exchange rates in which, theoretically, the free market would determine currency values. What's more, as the Nixon administration negotiated the terms of the floating currency system, it pressed its trading partners to abandon the capital controls they had earlier set in place to protect their domestic economies from competitive and potentially destabilizing foreign investment. The US also began suspending such controls.Footnote ²⁰

The rules of the new global economic order that Nixon began to build to replace the Bretton Woods system—-and that his successors would fortify—had devastating consequences in cities. The decision to allow currencies to float imperiled the ability of governments, including the United States, to exert control over their domestic economies. The defensive measures that governments would take to strengthen their national currencies and protect domestic business interests often came at the cost of measures intended to ease poverty and redistribute wealth. The elimination of capital controls, meanwhile, worsened industrial cities' vulnerability to capital flight and thus job losses. The change also created pressure on urban executives to adopt austere local budgets to attract investors. Additionally, the elimination of the controls intensified competition in credit markets, and poor cities found it increasingly difficult to secure financing for local projects.Footnote ²¹

As Nixon implemented his macroeconomic policies, he made domestic policy decisions aimed at taming the welfare state. His policies responded to a growing white backlash against welfare spending, a rebellion that his administration's “law and order” rhetoric helped to incite.Footnote ²² The president's policies also demonstrated his commitment to an anti-welfare-state conservative agenda decades in the making but increasingly popular among corporate interests given the changing global context.Footnote ²³ Nixon's domestic policy subsumed urban policy under the rubric of New Federalism, an initiative intended to restructure the distribution of intergovernmental aid. The president introduced New Federalism during his 1971 State-of-the-Union address. Appealing to backlash voters as well as to corporate concerns about excesses of democracy, he explained that revenue sharing, the hallmark of New Federalism, was intended to replace “present narrow-purpose aid programs,” in other words, the categorical grants that in some cases had sent antipoverty funds to cities and to African Americans specifically. In place of grants, Nixon proposed returning a portion of federal tax revenue to states and localities to spend as they saw fit. He wanted to do this, he explained, in order to diminish the authority of the “bureaucratic elite in Washington” over policymaking. This plan appealed to both backlash voters and corporate interests frustrated by costly congressional regulations.Footnote ²⁴

Ultimately, Nixon proposed two types of revenue sharing. General Revenue Sharing (GRS) transferred federal tax money to state and local officials to use with few restrictions. States governments received one-third of the funds, and local governments shared the rest. Special revenue sharing consolidated multiple categorical grants into block grants with loose policy directives. Although Nixon initially proposed six block grants, only the Comprehensive Employment and Training Act of 1973 (CETA) and the Housing and Community Development Act of 1974, which created Community Development Block Grants (CDBG), became policy. Together general and special revenue largely undermined the nation's war on poverty. They diffused among multiple localities funds that might have been targeted towards antipoverty efforts. Although Nixon did commit more resources to federal grants-in-aid than had previous presidents, he also took the first step in fundamentally transforming American urban policy.Footnote ²⁵

On the state and local level, Nixon's revenue sharing had the intended effect of shifting political power away from poor people and their advocates. In Baltimore, the effort by city officials during the mid-1960s to limit maximum feasible participation had failed to contain a surge in community activism. Urban policy under Nixon deliberately redirected power back to government officials. Aware that community residents would recognize the attack, federal officials responded defensively. In a booklet on GRS and civil rights, they explained, “While it is the responsibility of local government officials to make the final determination of where and how revenue sharing funds will be used in the community, it is the residents of the community who have the responsibility to inform their elected officials of their needs and desires.” (Emphasis in the original) Residents were encouraged to try to influence decisions by educating themselves, organizing citizen committees, meeting with officials, and “writing letters to the editors of local newspapers.”Footnote ²⁶ In Baltimore, community residents recently politicized by showdowns with city officials were hardly willing to substitute letter-writing for the active role they had taken in community development. Many continued to push city officials to require their participation in decisionmaking bodies.Footnote ²⁷ Federal urban policies, however, did not again prioritize community participation.

Not only did Nixon's New Federalism shift power in cities away from poor residents and towards officials, but it also altered the balance of power within governments. National studies on GRS uncovered that state officials' responses to the initiative varied in accordance with the level of control they had over the new funds. Those who ran government agencies and increasingly had to compete for resources endorsed revenue sharing less enthusiastically than did those who controlled states' budget-making processes and determined resource allocations.Footnote ²⁸ The results were not surprising given that many elected officials, who had authority over financial matters, supported revenue sharing in part to wrest authority from agency heads, the frequent recipients of federal categorical grants.Footnote ²⁹ The shift in the balance of power within governments occurred on the local level as well. In Baltimore the executive branch of the city government exercised considerable control over fiscal policy. The Baltimore City Charter empowered the City Council to lower but not raise proposed budgets. As on the state level, revenue sharing increased the influence of the executive and financial officers and diminished the power of agency heads. The change altered the balance of power between African-American and white city officials. The leadership and staffs of human services agencies, in which African-American women in particular had recently gained clout, saw their influence eroded. Meanwhile, the largely white and male finance and budget officials gained power.Footnote ³⁰ To be sure, Baltimore continued to receive multiple categorical grants, but the dramatic shift in urban policy that Nixon introduced contributed to undermining the authority of those in the city government likely to be the most sensitive to the concerns of African Americans and poor people.

The change in power was underway when William Donald Schaefer took office as Baltimore's mayor. Schaefer, who remained in the office until 1987, won his first mayoral election in 1971 after defeating two black candidates and dashing hopes that the city would elect its first black mayor. Like elected officials in cities in advanced capitalist nations around the world, Schaefer faced the daunting challenge of revitalizing his city within a global economy increasingly characterized by capital mobility. Schaefer, along with his finance and budget officers, prioritized revitalizing Baltimore by improving the city's attractiveness to investors. Towards that end, Schaefer kept a tight lid on spending and closely monitored the city's credit rating.Footnote ³¹

Schaefer's actions differed from those of mayors in other cash-strapped cities with stronger labor/liberal leaderships, who opted to borrow heavily during the 1960s and early 1970s to meet mounting social service obligations and public-sector payrolls. American cities, such as New York, Detroit, Philadelphia, and Washington, D.C., ultimately found it difficult to meet their debt obligations. Thereafter, creditors and firms such as Moody's Investor Services contributed to reigning in liberal city executives by denying the cities credit or dropping their credit ratings, making it difficult for the municipal governments to secure additional loans or sell bonds in tight credit markets.Footnote ³² The Baltimore mayor avoided that fate for his city. In 1975, when New York's financial crisis made national headlines, Baltimore had just over a third of that city's per capita debt and was one of the least indebted of the nation's largest cities.Footnote ³³ Schaefer's austerity was rewarded during the mid-1970s when Moody's raised Baltimore's credit rating from A to A-1. The mayor celebrated the achievement in a twelve-page advertisement in Forbes magazine. Intended to attract investors, the ad described Baltimore as “the most exciting, fiscally sound port city on the Atlantic.” It also included a lengthy list of the tax incentives the city made available to investors and, alluding to the financial crises of its rivals, bragged that Baltimore's fiscal health allowed it to offer these “advantages that our sister cities may not be in a position to offer.”Footnote ³⁴

As Schaefer worked to make Baltimore as business-friendly as he could, the staff of the EEOC, which has been renamed the Community Relations Commission (CRC), and African-American leaders in Baltimore maintained a watchful eye over hiring practices in the city government. Their efforts achieved some impressive results. By mid-decade, African-American women made up a third of the city's workforce, outnumbering both black and white men and white women, and black workers as a group accounted for fifty-four percent of city workers.Footnote ³⁵ Yet problems persisted. As the CRC noted, African Americans were concentrated at the bottom of the city hierarchy, and black and white women, with the exception of teachers, were further concentrated in low-wage health, education, and welfare jobs and clerical positions. To improve the city's record, the CRC pressed the mayor to adopt affirmative action as mandated by federal law. In 1976, John Ferron, the executive director of the CRC, commented that the mayor had been “extremely fortunate that the federal government [hadn't] taken the city on for its failure to implement such a plan.”Footnote ³⁶ Black elected leaders, meanwhile, pressed the mayor to use public-sector employment to combat the city's high African-American unemployment rate.Footnote ³⁷ Government jobs had become vital to the economic health of the city's black communities, and African-American leaders challenged Schaefer's fiscal priorities in their efforts to shape the city's employment policies.

Meanwhile, workers responded with anger to the effect Schaefer's fiscal austerity had on their paychecks. Among the ways unionized city workers demonstrated their frustration and demanded redress for wages that generally failed to keep pace with rising inflation was through strikes, which were frequent in the public sector throughout the US during the 1970s. In Baltimore, the actions yielded mixed results. A 1974 wildcat strike by AFSCME-affiliated sanitation, jail, and parks and recreation employees as well as some police officers won workers some important concessions. But the strike resulted in setbacks for public-sector workers as well. Baltimore's police commissioner fired some of his striking officers, and Schaefer reduced the budget of the sanitation department, which resulted in layoffs.Footnote ³⁸ The setbacks were not surprising. By the mid-1970s, public-sector strikes often failed to capture the popular support they earlier had received. Many urban residents, as well as those who had fled to the suburbs, increasingly identified as militant and greedy workers they had once associated with Martin Luther King and social justice.Footnote ³⁹ During the mid-1970s, AFSCME and other public unions did not lose their influence entirely. In Baltimore in 1975, public unions won closed-shop protections, and The Baltimore Sun referred to AFSCME as “one of the most powerful pressure groups with the City Council” two years later.Footnote ⁴⁰ But, providing a context for Schaefer's austerity, Nixon's macroeconomic policy decisions had contributed to worsening fiscal crises in cities. Raises for some workers could cost not only city services but also other workers' jobs. Many union members appreciated this. In 1976, for example, AFSCME member and school cafeteria worker Marian Dicks tried to counter her dismay at the outcome of her union's collective bargaining agreement with the city. “I'm not satisfied with the money we're getting,” she explained, “but I'm willing to accept it not to see people laid off from work.”Footnote ⁴¹

Given the dire straits in which many cities found themselves by 1977, urban voters hoped Democratic President Jimmy Carter would provide some relief. They were sorely disappointed. By the late 1970s, US domestic and international economic policies were unavoidably inseparable, a fact the new president clearly understood. As Carter entered office, urban constituents demanded policies to combat domestic problems such as poverty and unemployment. Like many working and middle-class Americans, business leaders pressed for measures that would tame inflation, and executives in transnational corporations and international lending institutions advocated policies that would strengthen the dollar. After two years of inconsistency, Carter settled on a set of policies, some of which were advocated by conservative economists. Unlike the Keynesians, who had fallen into disfavor because their demand-oriented policy prescriptions seemed ineffective in controlling inflation and unemployment, conservative economists recommended supply—rather than demand—side tax cuts, spending cuts, deregulation, and, most importantly, strict monetary policies. Although never a total convert to the conservative approach, Carter adopted a number of the remedies intended to reassert American hegemony and in 1979 appointed Paul Volcker to head the Federal Reserve Board. In an effort to combat inflation, Volcker abandoned the full employment goals that had guided the Fed's decisions and tightened the money supply so severely that he manufactured a recession worse than any the nation had experienced since the Great Depression. As historian Bruce Schulman notes, Carter's policy choices and appointments made it difficult for many Americans to remember that the Democratic Party had once fancied itself the champion of the people against the interests of unrestrained capitalism. As floating currency rates and free trade agreements unleashed global capitalism from the tethers created in Bretton Woods, the Volcker recession eventually catapulted unemployment figures into double digits. Democrats seemed to have switched teams.Footnote ⁴²

Carter's urban policies also disappointed his constituents in cities. By the end of his term, Carter's initiatives for cities stressed the use of federal funds to encourage public-private partnerships intended to stimulate redevelopment. Many in his administration did want to resurrect the spirit of redistribution that infused earlier Democratic social welfare initiatives. Under the Carter White House, CETA funds created public-sector jobs, and the administration also took steps to target CDBG funding towards poor cities. Ultimately, however, Carter decided that public-private cooperation could most effectively solve urban problems, and his macroeconomic policies foreclosed more expensive alternatives. He used the Economic Development Administration (EDA) to direct federal funds to cities to stimulate development. He also created Urban Development Action Grants (UDAG), which subsidized private investment in distressed cities. Both cities and investors could qualify for support once investors committed to a viable project, which could include anything from an industrial park to an upscale hotel. With his urban initiatives, Carter introduced city residents to trickle-down economics even before Reagan's supply-side revolution began.Footnote ⁴³

While Carter's urban initiatives frustrated many residents with low incomes, activists, and human-services workers in Baltimore, his public-private programs received enthusiastic endorsement in the mayor's office. Schaefer remained committed to luring manufacturers to the city, but he also appreciated the folly of trying to rebuild Baltimore using blueprints from its industrial heyday. Instead, the mayor wanted to create a postindustrial niche for his city. When he took office, a plan existed for the redevelopment of the city's harbor area. Few firms had stepped up to gamble on Baltimore's port, however, scared off, perhaps, by the dead fish that floated on the scummy surface of the water. Nevertheless, Schaefer had grand aspirations. “Tourism?” one city employee remembers thinking incredulously when the mayor touted the idea at a civic breakfast. “It was like working for a crazy person.”Footnote ⁴⁴ But Schaefer was undeterred by skepticism, and Carter's public-private programs aided his effort. By 1981, Baltimore had received $37 million in UDAGs and $50 million from the EDA.Footnote ⁴⁵ Some of the funding helped support neighborhood projects, and the city used much of the funds to capture or keep in the city industrial interests. But city officials also used federal funds to build an infrastructure for a tourism industry. A $10 million UDAG helped the city secure a glitzy waterfront Hyatt Regency hotel, and $1.5 million from EDA helped cover the costs of an aquarium.Footnote ⁴⁶ Federal and state revenue also helped subsidize a convention center, a dock for the city's historic all-sail US Navy warship, a science center, shoreline landscaping, and a marina.Footnote ⁴⁷

As tourist attractions became increasingly prominent in Baltimore's downtown skyline, officials in some of the city's human service agencies expressed doubts that the trickle-down solutions to urban poverty were working. By the end of the decade, Baltimore had one of the highest African-American unemployment rates in the country. Officials in the Mayor's Office of Manpower Resources (MOMR) blamed the figures on the tragic combination of their own success at job training and the Volcker recession. Employment programs in Baltimore had convinced formerly “discouraged” African-American workers to seek jobs in the city at the same time that the Fed's contraction of the money supply strangled the city's economy.Footnote ⁴⁸ Quentin Lawson, the director of the city's Human Development office and one of the few African Americans in the mayor's cabinet, also worried that revitalization efforts neglected the needs of people. The federal government had “traditionally emphasized … programs in physical development,” Lawson explained. What it needed was an equal commitment to a national “human service plan.”Footnote ⁴⁹

African-American leaders and public union officials expressed their critiques of the Carter administration's and Schaefer's urban priorities more aggressively. Collectively they argued that the policies were creating “two Baltimores—one black and poor, the other white and largely well off.”Footnote ⁵⁰ Although the city had a sizable African-American middle-class population, black leaders feared that, at the bottom of the economic ladder, class and race were becoming indistinguishable. Parren Mitchell, the city's first black congressman and the former director of the city's war on poverty, blamed Carter's macroeconomic policies for the deteriorating conditions in Baltimore.Footnote ⁵¹ Other leaders argued that investment in tourism, an industry dependent on low-wage service workers, was an unacceptable solution to the city's unemployment problems.Footnote ⁵² Public-union leaders voiced opposition as well. AFSCME had long charged that the mayor's policies inadequately responded to poverty in the city.Footnote ⁵³ In 1978, a columnist for a the newspaper of a smaller public-sector union argued that the mayor was not only neglecting antipoverty efforts but also adding municipal workers to the ranks of the poor and unemployed through layoffs.Footnote ⁵⁴ African-American leaders and union activists pressed the mayor to reprioritize.

Schaefer responded to criticism of his downtown priorities by passing the buck. “Many of the improvements in the Inner harbor are not the result of City funds,” the mayor explained in response to a letter critical of his downtown redevelopment efforts. “A very large percentage of the monies spent is the result of private investments and the City's ability to successfully lobby for specific state and federal grants, that were in many incidents, earmarked to assist in the development of the kinds of improvements realized in the harbor.”Footnote ⁵⁵ Schaefer's defense was not inaccurate. Although he had prioritized the city's fiscal health when his peers in other cities had taken financial risks to address social problems, Carter's urban policies had pushed Baltimore officials to align the city's interests with business. The Democratic Party, in other words, had abandoned poor, inner-city residents.

While Carter's trickle-down policies divided many in Baltimore, Ronald Reagan's all-out assault on struggling cities temporarily united former foes. Anticipating the gutting Reagan had promised to perform on urban and welfare programs, Schaefer stormed to the nation's capital, where The Washington Post described him as “stalk[ing] the halls of the US Capitol, pleading with one congressional committee after another to reject proposed federal cuts in a wide range of urban programs.”Footnote ⁵⁶ “Though we have occasionally disagreed on some matters in the past …” Ferron, of the CRC, wrote to Schaefer, “my primary purpose for writing, Mr. Mayor, is to share with you my intensified respect and admiration for you … especially in view of the fact that you appear to be the one person on the national level who has the courage to challenge the new order of priorities set by the National Administration.”Footnote ⁵⁷ Public-sector unions and the mayor also found themselves on the same side in the battle against Reaganomics. AFSCME played a leading role in defending government workers and welfare spending.Footnote ⁵⁸ Schaefer shared many of the concerns of public unions. In a letter to the Public Employees Department of the AFL-CIO, the mayor worried Reagan's new federalism would “[usher] in a new era of blatant neglect.”Footnote ⁵⁹

Perhaps neglect would have been preferable to the “Reagan revolution.” In 1981, the incoming Republican administration did not vacillate as Carter had as he weighed the interests of the needy against the needs of the interests; Reagan's allegiance to the private sector was never in doubt. He prioritized reasserting American hegemony by creating a domestic economy that bolstered the ability of US financiers and others to profit in the global marketplace. To do so, the administration sanctioned the continuation of Volcker's monetary policy and used it to justify a tax cut that favored the wealthy. Reagan also accelerated deregulation, declared war on the nation's unions and cut government spending on welfare programs. In addition, the administration negotiated agreements to further open the global economy to free trade. Out of step with its overall economic philosophy but in line with the effort to revive the American empire, the administration poured resources into the military. Although the spending created a deficit of unprecedented size, many of his other economic policies met their mark. The Volcker recession brought inflation under control, and the administration successfully created an environment that advanced US economic interests abroad.Footnote ⁶⁰ In cities across the United States where many residents had paid with unemployment and poverty for the “recovery,” however, spirits were not as high.

Some observers of Reagan's urban policy describe his approach as hands off. In fact, his “non-policy” nearly choked to death the nation's struggling cities. During the 1980s, federal aid expenditures declined for the first time since the 1940s. Between 1980 and 1985, federal funding of social services declined by twenty-five percent, aid for community services dropped by almost half, and support for training and employment declined by more than two-thirds. Reagan also discontinued GRS, eliminated the public employment component of CETA and reorganized the grant, and reduced funding for CDBGs. The administration even eliminated UDAGs.Footnote ⁶¹ As The President's National Urban Policy Report explained about earlier federal efforts earmarked for distressed cities, “These programs had the unintended effect of channeling credit to less competitive firms. The private market is more efficient than Federal program administrators in allocating dollars among alternative uses.”Footnote ⁶² To achieve some of his cuts, Reagan launched a new variation of New Federalism. Following Nixon's lead, Reagan further consolidated categorical grants into block grants. Unlike his Republican predecessor, however, Reagan directed block grants primarily to state rather than local governments to compel competition among localities for revenue.Footnote ⁶³

While Nixon's New Federalism had eroded the authority of African Americans within the city government, Reagan's iteration transferred many decisions about Baltimore's future out of the city entirely. And Baltimore was ill-equipped to defend itself in Maryland's capital. By the early 1980s, the city housed only nineteen percent of the state's residents but sixty-three percent of Maryland's recipients of public assistance.Footnote ⁶⁴ The city's representatives in Annapolis shouldered the weighty responsibility of defending Baltimore's need for a disproportionate share of the state's resources. Their task became even harder during the early 1980s when state-level reapportionment reduced the number of elected officials city residents could send to the statehouse. Baltimore lost six delegates and three senators and in 1983 sent a delegation to Annapolis that one of the city's papers described as “the weakest in recent memory.”Footnote ⁶⁵ In the capital, Baltimore's representatives faced elected officials from wealthy suburban jurisdictions whose residents, inspired by the 1978 California tax revolt, kept a watchful eye on government spending.Footnote ⁶⁶ The city's delegation also had to counter a white backlash against welfare expenditures and suburban and rural suspicion of urban profligacy. In a sometimes-hostile context, Baltimore's weakened delegation competed to win an increased share of the state's resources as overall federal funding decreased.

Ultimately, Reagan's policies took a huge bite out of Baltimore's budget. The city lost a total of $569 million in federal funds for its 1982, 1983, and 1984 budgets alone.Footnote ⁶⁷ In a city in which half the population received some type of welfare benefit, and only a third earned enough to pay taxes, the cuts were devastating.Footnote ⁶⁸ Baltimore's elected officials knew that additional property tax increases to raise revenue would only accelerate the movement of taxpaying residents out of the city, ultimately worsening the crisis. To compensate for lost federal revenue without significantly altering the tax, city officials raised rates for multiple city services and even charged higher fees for parking meters.Footnote ⁶⁹ Eventually, however, the city had no option but to eliminate jobs and services. Between 1980 and 1990, the city eliminated 18,400 municipal jobs, shrinking its workforce by thirty-seven percent.Footnote ⁷⁰ At the same time, the city cut municipal services by twenty-five percent.Footnote ⁷¹

The job cuts took a particular toll on African-American women, who remained concentrated in health, education, and welfare agencies, those hardest hit by Reagan's policies. By the early 1980s, African Americans made up fifty-six percent of the city government's workforce. Black women were close to seventy percent of the city's minority employees, and they were almost two-thirds of the female full-time classified workforce.Footnote ⁷² Discrimination certainly persisted in the public sector, and African-American women remained concentrated in the lowest-paid jobs in the government.Footnote ⁷³ Nevertheless, unionized public-sector jobs offered notable advantages over private-sector employment. As Hilda Ford, an African-American woman who headed Baltimore's Civil Service Commission and who had helped to open employment opportunities for black workers, explained, for example, the incomes of the municipal government's female employees more closely approached the incomes of their male counterparts than was the case nationally.Footnote ⁷⁴

The first workers in Baltimore to feel the bite of privatization were those receiving jobs or training through CETA programs. By March 1981, over 2,500 participants had lost their positions, and by 1984, the MOMR, which coordinated CETA programs and had a majority African-American and female staff, lost almost 1,000 jobs.Footnote ⁷⁵ The Urban Services Agency and the Department of Housing and Community Development, both of which also had majority African-American staffs, also suffered significant layoffs as a consequence of Reagan's policies.Footnote ⁷⁶ Ultimately, few city departments were spared. Layoffs, however, were not the primary way that the City reduced its workforce. More often, budget-makers and agency heads abolished rather than filled vacant jobs. Baltimore's 1984 budget, for example, required 125 layoffs but eliminated 550 positions through attrition.Footnote ⁷⁷

The City also responded to fiscal pressures by transferring services formerly provided by the city to private management. In 1984, officials handed over Baltimore's public hospitals to the Johns Hopkins Hospital.Footnote ⁷⁸ Although most workers retained their jobs at least through the transition, all staff members, approximately forty percent of whom were African-American women, lost their status as City employees.Footnote ⁷⁹ After the transfer, it became more difficult than it had been earlier for the African-American community in Baltimore to effectively mobilize political pressure to combat discrimination in the hospitals. Private employers were less vulnerable than city officials to the political pressure African-American leaders had historically used to win jobs and improve working conditions for black workers. Because they contracted the public sector, Reagan's cuts imperiled the hard-won jobs that had helped a generation of African-American women and their families buy homes and send their children to college.

Women bore the brunt of Reagan's cuts in a second way as well. Although often cited by conservatives as a cause of the urban crisis, War on Poverty programs and other federally-funded social-welfare initiatives had significantly contributed to alleviating poverty in the nation's cities.Footnote ⁸⁰ In 1981, Maudine Cooper, vice president of the National Urban League, explained, “Two-thirds of the black underclass were lifted from poverty between 1967 and 1975, primarily as a result of government programs.”Footnote ⁸¹ The Baltimore Urban Services Agency echoed her defense in a “Fact Sheet” staff members distributed to invite city residents to join them and other human-service workers in protesting Reagan's cuts.Footnote ⁸² Antipoverty programs had had specifically gendered effects as well because many had been particularly helpful to those to whom the primary responsibility for children and aging relatives fell. As social service agencies, “forced to do less with less,” eliminated or downsized programs that had eased women's caretaking obligations, women were forced to assume new responsibilities.Footnote ⁸³ Reductions in funding for daycare services as well as housing and other programming for senior citizens directly increased many women's domestic work.Footnote ⁸⁴ Reduced public spending on healthcare led to high medical bills and also time spent caring for sick family members.Footnote ⁸⁵ Cuts in food stamps and nutrition programs sent increasing numbers of women and children to distant food pantries and soup kitchens, increasing the amount of time and effort needed to feed families.Footnote ⁸⁶ And reductions in sanitation services, insect and rodent control, urban recreation programs, and library services meant that homes, alleys, and streets became less safe for children to play in at the same time that fewer public spaces were available to them, increasing the need for adult supervision.Footnote ⁸⁷ As Shelia Rhyne, a Baltimore mother who encountered trouble securing social services because of Reagan's cuts, wrote in a letter to the Afro-American, “My youngest son has been hospitalized with a torn tendon in his hand from glass in the yard surrounding the building. Why do the low to middle class people have to live in projects where they must watch their children's every move because they don't know whether their children will be killed, raped or God knows what else?”Footnote ⁸⁸

As the city made cuts, some women could afford to purchase services formerly provided by the government in the private or informal sectors. Reaganomics, however, left women with limited means to provide the services themselves or do without. Families did what they could, but federal-level cuts left gaps that women could not easily fill. In 1983, Bob Cheeks, the executive director of the Welfare Rights Organization sent an irate letter to Schaefer. A broken elevator in a public housing highrise had delayed a mother who was rushing to seek medical attention for her sick infant. The delay, Cheeks charged, cost the child his life. Cheeks blamed Schaefer for the death because the mayor's “single-minded focus to build hotels, restaurants, shops, and housing for the rich” had come at the expense of “the concerns of the poor.”Footnote ⁸⁹ Certainly the mayor had prioritized downtown development. But two years earlier, Reagan had nearly halved federal spending on public housing, which also helps to account for the broken elevator.Footnote ⁹⁰ In response to the baby's death, a group of high-rise residents founded M.O.M., an organization of mothers united to “Save Our Children from High Rise Housing.”Footnote ⁹¹ Even collectively, however, it was impossible for low-income women to patch on their own every hole Reagan cuts had rent in the US safety net.

Privatization deepened an urban crisis that by the early 1980s had already made Baltimore a city with one of the highest percentages of people living in poverty in the nation.Footnote ⁹² The urban crisis intensified not because cities had been profligate, but because procorporate federal policies came at their expense. During the late 1960s, as the Bretton Woods system unraveled and American corporations entered a crisis of profitability, US presidents participated in building a new international order that bolstered corporate interests domestically and enabled the United States to reassert global dominance. As a result, the urban crisis entered its most acute stage because of political decisions not typically associated with urban policymaking. The floating of currency rates, the adoption of strict monetarist policies, and the erosion of international capital controls had devastating consequences in US cities.

Urban policies in the United States reflected the presidents' commitment to corporate concerns. Nixon's and Reagan's New Federalisms were efforts to reduce or eliminate the federal government's responsibility for the maintenance of the welfare state, a goal that would free capital for more competitive uses. In Baltimore, the policies contributed to the upward and whiteward shift of power away from poor people and African Americans and eventually increasingly out of the city itself. Carter's support of public-private partnerships and sanction of the constriction of the US money supply were also a concession to the new order and an abdication of the government's responsibility for poverty alleviation. In Baltimore, the policies pushed city officials to create an urban economy more responsive to the needs of businesses than residents. They also enabled Schaefer to invest in an industry that replaced manufacturing with low-wage service-sector jobs. Reagan's privatization initiatives further undermined public commitments. In Baltimore, his policies left a city to fend for itself in a global economy in which it was poorly equipped to compete. They also shrank a sector of the city's labor market vital to African-American communities while simultaneously depriving city residents of needed services. Thus it was with good reason that a Baltimore Afro-American newspaper reporter covering the protest by employees of the Urban Services Agency in 1986 explained to readers, “There is tragedy on both sides of the layoffs.”Footnote ⁹³ The women left unemployed by the cuts faced a dismal job market, and the recipients of the services the women used to provide, among the most vulnerable in Baltimore's population, were left to find their own way in the city's troubled economy.