Pay Now, or Pay Later

When it comes to rent, it’s usually pay now, or else, but as the crisis deepens in New York City and State – with a square mile of New Rochelle locked down under National Guard patrol, SUNY and CUNY schools slated to go all online at the end of next week, the number of confirmed cases rising precipitously by the day, and, in perhaps the clearest sign, the St. Patrick’s Day Parade cancelled for the first time in more than 200 years – everything comes back, as it often does, to rent. Being too damn high. And who pays it. And who collects it each month.

Cancellation of the Parade will be to COVID-19 (hereafter: the disease; with SARS-CoV-2, hereafter: the virus) and Mayor de Blasio what cancellation of the Marathon was to Hurricane Sandy’s aftermath and Mayor Bloomberg – the moment of reckoning when an elected official confronts and publicly acknowledges the fact that we are no longer in a business-as-usual scenario – and I expect/hope that closure of the public schools will follow, though, in the meantime, significant damage has probably already been done by keeping them open. And why did we keep the schools open? Because they provide essential meals for hundreds of thousands of young people everyday, and otherwise-unaffordable childcare for hundreds of thousands of working New Yorkers. But is that the way it should be? What if we had functioning social welfare systems? A public health system that was properly valued and funded? Universal childcare and paid sick leave? Medicare for All? Would we still be facing the predicament we now face? Great that New York State is offering state employees two weeks paid leave if they are “quarantined or in isolation due to #Coronavirus,” but what about creating opportunities for people to avoid getting sick in the first place?

Pay now, or pay later, and we opted for the latter option.

I’ve been reflecting a lot on rent though. My partner is a gifted business person and entrepreneur, who also happens to have one of the best landlord’s in New York City. We absolutely love him, and have often discussed how fortunate she is to have ended up in his building. My partner is also fortunate that her business model, and the strong community at its core, are insulating her from the worst of the harm currently being inflicted on so many of New York’s vital small businesses. I’ve previously written that, without widespread rent forgiveness, we will likely see a massive wave of business failures, and it is already evident that countless New Yorkers are panicked about the personal and professional financial ramifications of this (now official) pandemic. Evidence of the suffering is everywhere – drivers wearing masks, but still driving; looks of dread on the faces of owners and employees alike at neighborhood restaurants; delivery people expected to keep on delivering but now being treated like bike-bound vectors at many of the luxury buildings to which they ride – and the dire necessity is also making the crisis worse.

It all comes back to rent (and utilities, and phone bills, etc., but especially rent), and in reflecting upon that fact, we can arrive at a deeper truth about what it means to live in a highly-leveraged permanent-growth economy – the same economy that has been driving the marvel that is our planet’s biosphere towards climatic and ecological rupture/collapse. Why don’t all the City’s landlords simply extend rent forgiveness until the pandemic has passed? Greed is the simple answer, and certainly – mixed with contract law – there is some of that. But in many instances, the landlords don’t actually own the buildings outright. In many instances, the landlords have taken large commercial loans against the income streams generated by their buildings, and only the steady flow of rent payments – to landlord and passed along to banks – allows the “owners” to go on “owning” that for which they are, in fact, still paying.

And what happens if many of those landlords cease, for one reason or another, to pay, or be able to pay, the interest on their mortgages and commercial loans? We all remember 2008. Not that this is like that, exactly, but it should have proven more of a cautionary tale than it did, just as SARS and MERS – the latter emerging roughly a decade after the former – should have served as clear signals that another zoonotic coronavirus outbreak was highly likely. (My friend Josh – the founder of Green Top Farms, and among the many business owners currently grappling with the hardships brought on by the spread of this disease – broke down elegantly, based on the work of Dr. W. Ian Lipkin, the connections between climate crisis, food insecurity, zoonosis, and pandemic in his newsletter Food Safety in the Age of Coronaviruses; his use of the  plural is important – this pandemic is not a black swan, and, like the three 500-year floods visited, in three years, upon zoning-averse Houston, it leaves little doubt that we live in non-stationary times and that our “new normal” is chaotic, escalatory, and without clear historical precedents.)

Even if they wanted to, many of the landlords couldn’t forgive rent because, if they did, who would pay the banks? And if no one pays the banks, as we’ve learned, the economy melts down (just like the public markets have been doing in recent weeks). And if the economy melts down – as it seems to be threatening to – countless people suffer. I wish I could say that’s why the President and his cronies, rightly called, are working to cut the payroll tax and bail out select industries, but, alas, these efforts seem to be so much more disaster capitalism – attempts to find a backdoor way to undercut and then privatize Social Security and to distribute patronage to industries, admittedly, in dire straits, but selected with political interests in mind.

As for the people, and their rent, hopefully it trickles down. The money, that is. So goes the logic. Clearly, our system is failing in many respects – chief among them, the human – and the least we can do, beyond doing our part to stem the contagion, is keep clear-eyed perspective on what, why, and how went wrong and owing to actions by whom.

As I’m finishing this piece, news has just broken that the NBA has suspended its season after a player (reportedly Rudy Gobert) tested positive for the virus; earlier this evening, the Post reported that a “Broadway usher who worked two shows [had tested] positive for coronavirus“; and in the only bit of vaguely comic news, also courtesy of the Post, a “Coronavirus conference [was] canceled in New York because of coronavirus.” Strange times, and sadly, much of this is self-inflicted wound, but it’s never too soon to start to stem the bleeding. First, we have to take this as seriously as it is, and arrange our priorities accordingly while always remembering its impacts are distributed highly unevenly (even if the virus itself, having now reached Tom Hanks and his wife, is not) and part of stemming the viral spread is addressing the human suffering.

9 thoughts on “Pay Now, or Pay Later

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