Robert Neuwirth, author of the new book Shadow Cities, has written a fascinating story for The New York Times about squatters in New York City. Not the crunchy Tompkins Square Park crowd of the '80s, but a much larger world of the mid-nineteenth century:
Squatters controlled much of New York. The Upper East and Upper West Sides were shanty areas that were home to more than 20,000 squatters. Brooklyn was an independent city (population 200,000) whose fringe areas were settled by squatters. The self-appointed government of Slab City, in what today would be Boerum Hill or Gowanus, ruled a population of 10,000. Metalsmiths established the Brooklyn neighborhood called Tinkersville. Phoenix Park rose on that city's ash heaps. The zone dubbed Texas, in South Brooklyn, got its name because locals deemed it as far off as the Alamo....
New York's squatter communities had their own stores, bars and even roadside inns. A squatter saloon on 78th Street served German fare and homemade kummel. The Terrace, at Eighth Avenue and 67th Street, was a squatter general store that newspapers likened to Dickens's Old Curiosity Shop. The squatter residents of Ashville, centered at what today is West 81st Street, built their own schoolhouse and chapel....Squatter homes were often folk-art creations and monuments to ingenuity. Some shorefront squatters, for example, built their homes like pushcarts: when the tide came in, they simply rolled their domiciles to the safety of the high-water line.
The settlements were destroyed after the "real estate lobby pushed through a decree allowing the city to demolish buildings not hooked into the water and sewer system, and from the 1880's on, landlords teamed with city officials to dislodge the squatters."