In August 2025, New York City’s pivotal transformation in the late twentieth century has returned to the spotlight, thanks to a new book by Jonathan Mahler, The Gods of New York. The book, which has already sparked discussion in leading publications like TheStreet Pro and Slate Magazine, offers a sweeping account of the city’s tumultuous journey from near-ruin in the 1970s to a dramatic—if complicated—rebirth in the 1980s. Through Mahler’s lens, readers are invited to witness how Wall Street bankers, real estate tycoons, and a cast of iconic New Yorkers shaped a metropolis that would both dazzle and divide.
Mahler’s narrative zeroes in on the years beginning in 1986, a period marked by seismic shifts in New York’s economic, social, and political landscape. According to TheStreet Pro, the book chronicles how Wall Street profits sent “waves of money splashing across Manhattan,” breathing new life into a city that had flirted with bankruptcy just a decade earlier. But the money didn’t reach everyone. Nearly one-third of Black and Hispanic residents remained below the poverty line, and thousands of New Yorkers struggled with homelessness, addiction, AIDS, and mental illness. The city’s manufacturing backbone had all but vanished, replaced by a service economy that left many behind.
“The city had just bottomed out in such an extreme way,” Mahler told Slate Magazine’s Emily Bazelon, recalling the devastation of the 1970s. “There were these arson fires which decimated hundreds of thousands of units of housing. They just swept across the Bronx and destroyed home after home.” The city’s infrastructure was in shambles—graffiti-covered subways, crumbling playgrounds, and a tax base that had evaporated as roughly a million people fled to the suburbs or beyond.
Yet, as Mahler explains, the election of Ronald Reagan in 1980 signaled a new era. Reagan’s policies—rooted in the free-market philosophies of Milton Friedman—ushered in sweeping deregulation, tax cuts for corporations and the wealthy, and a rapid acceleration of financial technology. These changes helped Wall Street roar back to life, transforming New York into a global capital of finance. As Mahler put it, “The bankers effectively saved New York City, but ‘saved’ is a tricky word in this context because they saved the city for a certain segment of the population.”
The benefits of the new economy were not evenly distributed. The city’s resurgence was built on finance, real estate, and what Mahler calls “knowledge industries”—media, marketing, and public relations. For working-class New Yorkers and immigrants who once found stable jobs in manufacturing, the ladder to the middle class was suddenly missing several rungs. As Mahler observed, “Maybe the bankers saved New York and warped New York or wrecked New York depending on your point of view. Exactly. They saved it and destroyed it, right?”
At the center of this era stood Mayor Ed Koch, who was first elected in 1978 as the city struggled to shake off its malaise. Koch became a symbol of New York’s resilience and optimism, famously riding the city bus to his inaugural and engaging with residents across the five boroughs. “He really becomes the mascot of the city as much as the mayor of the city,” Mahler noted in his Slate Magazine interview. But Koch’s strategy for reviving the city’s finances was controversial: he slashed the city budget, closed hospitals, reduced police and sanitation services, and—crucially—offered generous tax breaks and zoning waivers to real estate developers, including the then-rising Donald Trump.
These incentives did help jumpstart development, but they came at a cost. The demolition of welfare hotels and other affordable housing options left many vulnerable New Yorkers with nowhere to go but the streets. As Mahler explained, “You’re destroying all these old welfare hotels that are filled with people who are going to have nowhere to go but the streets.” The policy, while intended to catalyze economic growth, also laid the groundwork for a housing crisis that would haunt New York for decades.
Mahler’s book doesn’t shy away from the darker side of this transformation. The late 1980s were a time of deepening racial and economic divides, with high-profile incidents and personalities dominating headlines. The period saw the rise of figures like Al Sharpton and Rudy Giuliani, the Central Park Five case, the Howard Beach and Tawana Brawley controversies, and cultural moments such as Spike Lee’s Do the Right Thing and Oliver Stone’s Wall Street. Tabloid journalism, Mahler notes, “was ready to pour gasoline on every fire.”
Despite the city’s newfound prosperity, the absence of a coordinated housing policy exacerbated inequality. “What happened in New York is that there was no plan,” Mahler told Slate Magazine. Efforts to incentivize affordable housing came only after the crisis was well underway, and even then, their effectiveness was hotly debated. “Some people say it’s been the best way to go. I think it’s also been pretty widely criticized,” Mahler observed. By the time city leaders recognized the scale of the problem, they were “really just playing catch-up ever since.”
The book’s cast of characters is as compelling as the events themselves. From Ed Koch’s populist touch to Donald Trump’s rise as a real estate mogul, from the activism of Al Sharpton to the cultural impact of Spike Lee and the tabloid press, Mahler weaves a tapestry of personalities who both reflected and shaped New York’s identity. The era was also defined by tragedy and scandal—the AIDS epidemic, the crack cocaine crisis, and a series of racially charged crimes and miscarriages of justice that exposed the city’s simmering tensions.
Mahler’s account, as discussed in both TheStreet Pro and Slate Magazine, underscores the paradox of New York’s revival: a city saved for some, but not for all. The economic boom of the 1980s brought glitz and glamour to Manhattan, but it also widened the gulf between rich and poor, native and newcomer, power broker and powerless. The consequences of decisions made in those years—especially regarding housing and development—continue to reverberate in the city’s ongoing struggles with affordability and inequality.
For readers today, The Gods of New York serves as both a riveting history lesson and a cautionary tale. The story of New York’s rebirth is filled with ambition, controversy, and unintended consequences—a reminder that the forces shaping cities are as complex as the people who call them home.
