You’ve seen the headlines: S&P downgrades Chicago’s credit rating. The mayor proposes a property tax rate hike. CPS and the mayor’s office clash over responsibility for the municipal workers’ pension payment. City Council approves the use of expiring TIF revenue to fund $1.25 billion in bonds for housing and economic development.

A budget war is raging in Chicago, and our press is all over it. But rarely do we confront the deeper questions that underlie the conflict, here and in every other American city: Are we actually broke, and why? Who controls the cash that flows into and out of our cities? Is social democracy, let alone socialism, even possible at the municipal level–or are we destined to forever beg for scraps of state and federal revenue?

Join the Municipal Finance Book Club as we approach these questions through excerpts from Robert Caro’s legendary The Power Broker, his biography of Robert Moses, the powerful planner who reshaped the urban fabric of mid-century New York City. In this week’s excerpt, we’ll learn about the financial crisis that the Democratic machine’s corruption caused in New York City before the First World War. From there, we’ll see how Robert Moses was able to wield a growing municipal bond market and a firehose of federal dollars to overcome the constraints of the crisis and build his ambitious public works – for better and for worse.

Please read the following chapters for Part 1:

• Chapter 18: New York City Before Moses

• Chapter 28: The Warp of the Loom

This is the first in a two-part series.