Abstract
Bethlehem, Pennsylvania, a steel town north of Philadelphia, declared itself “Christmas City, U.S.A.” in 1937 as part of an effort to unite the city’s North and South sides and draw visitors to downtown retailers. Postwar, the Christmas City branding increasingly focused on Bethlehem’s eighteenth-century Moravian history. These efforts to diversify the city’s steel economy through heritage tourism reflect an early convergence of urban renewal and historic preservation that local leaders termed historic renewal. With the closure of the Bethlehem Steel Corporation’s headquarter plant in 1998, the city’s tourism potential gained new relevance as efforts recommenced to shape Bethlehem’s identity apart from manufacturing. Exploring the ways a small city merged redevelopment efforts and heritage attractions years before the proliferation of festival marketplaces adds local variation and new insight to studies of urban renewal that often focus on big-city clearance projects.
On December 7, 1937, four hundred men and women crowded into the Hotel Bethlehem ballroom to wait for sunset. Thousands of multicolored electric lights had been strung in anticipation across twenty-two blocks downtown. They lined the streets, two massive evergreens that flanked the Hill-to-Hill Bridge, and an eighty-foot wooden “Star of Bethlehem” perched atop nearby South Mountain. At 5:30 pm, Marion Grace, head of the Chamber of Commerce’s Women’s Advisory Committee and wife of the Bethlehem Steel Corporation president, placed her hand on the miniature electric pole constructed in the ballroom’s corner. With the flip of a switch, Bethlehem, Pennsylvania, became “Christmas City, U.S.A.” 1
Located sixty miles north of Philadelphia and eighty miles west of New York City, Bethlehem was named on Christmas Eve 1741 by the Moravians, a Protestant communitarian sect from what is now Germany and the Czech Republic that made the area on the north bank of the Lehigh River its primary North American settlement. But by 1937, the city had become intimately linked to Bethlehem Steel, an industrial behemoth headquartered since the nineteenth century on the river’s south bank. “The Steel,” as it is called locally, dominated the city’s economy. The creation of Christmas City to capitalize on heritage tourism represented an early attempt at diversification into other revenue sources during the Depression and served as a touchstone in efforts to unite the city’s North and South Sides.
The reinvention of Christmas City in the 1950s and 1960s, however, effectively strengthened efforts to distinguish the two banks. Just as eighteenth-century visitors contrasted the neatness and regularity of Moravian Bethlehem with uncultivated wilderness and industrial bustle, this language of order reemerges in the mid-twentieth century to combat urban blight. While postwar urban renewal and historic preservation efforts ostensibly represent conflicting outlooks—one to erase the past, the other to celebrate it—they messily converge in Bethlehem during this period.
With a few notable exceptions, including Alison Isenberg’s diversely sourced Downtown America and David Schuyler’s study of Lancaster, Pennsylvania, urban renewal scholarship has emphasized the experience of large cities, even as 40 percent of the more than $13 billion federal dollars spent on these programs between 1950 and 1974 went to municipalities with less 100,000 people. 2 Rather than assume small cities followed the examples of major urban centers, a closer look at places like Bethlehem, with a postwar population of roughly 75,000, can highlight the local contingencies—historical, geographic, and cultural—with which federal policies interacted. Moreover, Bethlehem leaders’ emphasis on “historic renewal,” a term that emerged in the late 1950s but has roots reaching back to the city’s eighteenth-century founding, places this town on the vanguard of the now commonplace strategy of mixing heritage tourism with economic development. Indeed, not long after 1954 Housing Act legislation opened up federal funds for rehabilitation as well as clearance, Bethlehem was among a dozen cities highlighted in a government publication on the role of historic preservation in urban renewal, suggesting it served as a model for other cities as much as it followed large urban centers’ leads.
With the closure of Bethlehem Steel’s headquarter plant in 1998, the relationship between North and South Bethlehem and the future of the city’s economy gained new relevance. As post-Steel Bethlehem today works to remake the city in the image of the festival marketplace and “tourist city” template that larger cities adopted with gusto after the successful adaptive reuse of San Francisco’s Ghirardelli Square in 1964 and Boston’s Faneuil Hall Marketplace in 1976, local officials would do well also to evaluate Bethlehem’s own long experience with historic renewal for both its past successes and pitfalls as it builds upon and reshapes the local landscape. 3
A History of Division
Despite its close proximity to the urban centers of Philadelphia and New York, for much of its early history Bethlehem reflected a cultural distance that was much greater. The Moravians organized the town in 1741 as a communitarian settlement where residents contributed to a common “Oeconomy” and lived in buildings separated by age, gender, and marital status. Although this system was dissolved within a generation, for the first 100 years the Bethlehem settlement and the church-owned farmland across the river to the south remained closed to non-Moravians. Outsiders’ descriptions of the quaint North Side community as being somehow distinct, set apart from the rapidly changing world around it, emerge early in the city’s history. A visitor from Philadelphia remarked in 1790 on the regularity of the Moravians’ stone buildings in what she calls “this little Eden.” “There is an air of dignified simplicity remarkably exemplified through these several structures,” she writes. “The greatest order and unanimity is preserved in Bethlehem.” 4 Moravians frequently guided such visitors through the community buildings, concluding their tours at the Sisters’ House. Here handcrafts were displayed for purchase, “quaint” souvenirs foreshadowing the heritage tourism industry that blossomed at the site two centuries later. 5
In 1844, the church began to allow non-Moravians to lease buildings and land and sold South Side farms to pay off debt abroad. The Moravians took care to maintain a distinction between their traditional way of life and the noise and dirt of the factories that soon dominated the other bank (Figure 1).
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Visitors’ nostaglic renderings of North Bethlehem intensified during the pervasive industrialization of the nineteenth century, increasingly painting the Moravian settlement as a cherished relic of the past. An 1881 book on manufacturing in the Lehigh Valley elaborates on this then-established distinction: The traveler who arrives after nighfall will be startled by the angry tongues of furnace flame, shooting athwart the sky. He will catch momentary glimpses of active groups of half-naked men through the arched walls of the iron and steel works, and note the sickly hue of sulphurous fires at the zinc works beyond.… It is fortunate, however, that these great industries and railroad depot, together with a prosaic borough of workmen’s houses are placed altogether upon the southern side of the river, leaving the old town opposite undisturbed in the possession of its richness of antiquated Moravian landmarks.
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North and South Bethlehem. In this 1798 view (top), looking north across the river at the Moravian settlement, the South Side is still mostly forest and farmland. The stone masonry architecture of the original Moravian buildings, which still stand in Bethlehem’s North Side downtown, share a distinct aesthetic from the steel factory, shown here in 1910 (bottom), and the residences later built on the South Side (Isaac Weld, Travels Through the States of North America, Vol. 2, 1800, Beinecke Rare Book and Manuscript Library, Yale University; Private Collection of Bill Weiner from Lehigh University’s Beyond Steel: An Archive of Lehigh Valley Industry and Culture).
Primary among these South Side industries was the Saucona Iron Company. Founded in 1857, easy access to the anthracite coal mines in the Lehigh Valley coupled with the boom in railroad transport helped the enterprise grow into the Bethlehem Steel Company in 1899. By 1917, the Steel was the nation’s third largest industrial company, with satellite plants, mines, and shipyards all over the country and the world. 8 The needs of the company brought thousands of immigrants, mostly from Southern and Eastern Europe, into the community during these formative decades. The new workers settled almost entirely in South Bethlehem, which soon gained a reputation as being overtaken by foreign customs and vice.
As the operations and smoke of the steel plant reinforced perceptions of noise and grime, higher-ranking workers and executives at the Steel attempted to distance themselves from the working-class neighborhoods. Charles Schwab, who became president of Bethlehem Steel and incorporated it in 1904, bought a mansion in Fountain Hill, a separate South Side borough west of the plant. Schwab had successfully led the Carnegie Steel Company through its transition to the U.S. Steel Corporation, the nation’s largest steel manufacturer. He helped turn Bethlehem Steel into the next biggest company, largely based on his interest in producing a new type of structural beam used to build skyscrapers. Between 1910 and 1915, the Steel’s employment doubled; in 1915 the Bethlehem plant alone counted 24,500 workers. 9 Schwab passed on the presidency the following year to his protégé Eugene Grace, who would head the company for the next thirty years. Rather than settle in Fountain Hill, Grace and his wife Marion, a native Bethlehemite whose father had been a South Bethlehem burgess, bought a twenty-three room house in 1923 in West Bethlehem, on the north side of the river near the old Moravian settlement. Grace and six other senior officers lived within a few blocks of each other on what became known as Bonus Hill, while the side streets housed aspiring junior executives, professionals, and businessmen. 10 Although the Steel Company was heavily involved in consolidating the separate boroughs of Bethlehem, South Bethlehem, and West Bethlehem into one city in 1917 and in constructing the Hill-to-Hill Bridge linking the two banks in 1924, class distinctions between North and South persisted (Figure 2).

Detail of Bethlehem, PA. The Lehigh River divides the city. The South Side is dominated by the Bethlehem Steel Corporation. The original Moravian settlement, now a historic district on the National Register, is on the north side of the river. Bethlehem, PA. Department of Engineering, “Bi-Centennial Map of the City of Bethlehem, Pennsylvania, and Vicinity” (Bethlehem, PA: R.L. Fox, 1942). Courtesy of Map Collection, Yale University Library. Outline by author.
“Practically a United Front”: Bridging North and South Bethlehem with Christmas
This brief sketch of the city’s development sets the stage for the birth of Christmas City in December 1937. When Marion Grace flipped the switch to illuminate Bethlehem’s business district with decorations, a man with large ambitions for the city’s economic development stood at her side. Vernon Melhado was also there when Santa arrived at City Hall on a sleigh float the next day and when she handed the Moravian bishop the key to open the community putz (an elaborate traditional nativity scene). Melhado had become president of the Chamber of Commerce the year before, in the midst of the Depression and impending world war. A longtime beneficiary of government defense contracts, Bethlehem exemplified the close relationship between these two events. Steel employment in Bethlehem had hit a low of 6,500 in 1933, and though it was slowly recovering, it would take US involvement in World War II and demand for ships and armaments to bring the numbers back, eventually peaking in 1943 at over 31,000 people at a time when the city’s population was roughly 59,000. 11
Melhado came to Bethlehem from Jamaica fifteen years earlier after marrying Mary Taylor Snyder, the daughter of a Bethlehem Steel VP. Company president Charles Schwab was among the guests at his wedding. Melhado’s connections to the Steel extended into the vision and resources he brought to the Chamber of Commerce, which at the time was dominated by business connections to the Steel rather than local merchants. 12 Like the Steel’s civic interventions, the new branding would not fundamentally challenge embedded class distinctions. Melhado nonetheless saw a way to bridge and bolster both North and South Side retailers using Christmas, all despite the fact that Melhado was himself a Sephardic Jew. 13
The result of Melhado’s efforts was a celebration that epitomized the increasingly close fit in the early twentieth century between Christmas shopping and Christian symbols. 14 “It is unfortunate that we are experiencing a minor depression. It is hoped that these decorations will encourage our businessmen,” Melhado proclaimed at the December 7 lighting ceremony, sharing the contemporaneous efforts of Chambers across the country to attract visitors downtown with promotional activities. Two years later, President Roosevelt would respond at a national level to major department stores’ request that he move the date of Thanksgiving earlier to extend the Christmas retail season. 15
The use of Christmas displays in particular to boost business was not without precedent at the time. Not far away in Philadelphia, Wanamaker’s department store had since the 1910s elaborately decorated its Grand Court during the holidays, emphasizing religious motifs to present it as “above commercialism” while attracting thousands of customers to its retail space. 16 Meanwhile, Country Club Plaza in Kansas City, Missouri, began lighting the exteriors of its retail buildings in 1925 to create a beacon for burgeoning automobile traffic. 17 Early photographs show a star atop one of the stores not unlike that erected on Bethlehem’s South Mountain to draw visitors from the surrounding area.
In addition to endorsing the Star and the blocks of Christmas decorations downtown, the Bethlehem Chamber of Commerce encouraged residents in 1937 to participate in a home lighting contest. As Marion Grace put it, “There is one thing … about my Bethlehem that I have never been proud of and that is our Christmas decorations. … I have often been irked in the past years by hearing my friends say, ‘Let’s drive to this city or that city to see the Christmas lighting.’” 18 The new contest attracted elaborate displays of multicolored lights, lit Christmas greetings, imitation snowmen, Santas climbing down chimneys, and nativity scenes. 19 Rules stipulated that entrants light their homes every night from dusk until 10 pm. The newspaper proudly reported throughout the Christmas season that policemen had their hands full directing traffic caused by visitors touring the lights, and during Christmas week almost 3,000 of them stopped at the Chamber of Commerce to visit the community putz. 20
But despite Melhado’s proclamations that “Bethlehem can claim practically a united front of loyal, patriotic citizens, who, in splendid teamwork, are always working and ever planning for a cleaner, a finer and greater Bethlehem,” the integration of North and South in 1937 is a more complicated picture. A closer look at the home lighting contest, for example, suggests that Christmas City was largely a North Side affair, with thirty of the thirty-five entrants north of the river. Melhado, Marion Grace, and several other members of the Women’s Advisory Committee to the Chamber had spousal ties to Steel executives and managers, and all but one lived in prosperous North Side neighborhoods. 21 Not only did the North Side Central Moravian Church serve as a backdrop for much of the Christmas City celebration, but members of the Moravian congregation contributed the largest donations to the Chamber of Commerce’s Christmas City fund to decorate the business district. 22
In August 1938, Melhado died at age forty-nine of a heart attack while at the North Side home of a prominent Bethlehem widow talking over plans for the coming Christmas season. As his obituary dramatically put it, “Mr. Melhado literally gave up his life in the interests of this city.” 23 The following year, Bethlehem Steel donated a more permanent Star of Bethlehem constructed of galvanized steel and lined with 280 bulbs as a “symbol of righteousness connecting the present Bethlehem with the community that two centuries ago was founded and named by a band of Moravians.” At a cost of $4,000, the new star stood ninety-one feet tall and was visible from twenty miles. 24
Thanks to the war overseas and Bethlehem’s role in producing armaments, Steel employment had rebounded to 10,900 in 1938 and 18,200 by 1940. 25 In 1941, the Chamber geared up to celebrate Bethlehem’s bicentennial with an unprecedented display of unity. It urged every household to place a lighted candle in every window, a Moravian tradition, by December 18. “Let’s make it 100% and show the true co-operative spirit and pride of the City of Bethlehem,” ads read. According to the newspaper, local stores sold between 40,000 and 50,000 candles that year, certainly a boon to business. 26 Colored lights in the shapes of stars and circles hung pole-to-pole across streets in both the North and South Side shopping districts (Figure 3). Following the attack on Pearl Harbor, residents were told not to leave their Christmas decorations lit without “instant control,” in case they needed to be turned off to protect against an air raid, and the Star was dimmed as a defense precaution.27 But in many ways World War II had a greater effect on civic morale than Melhado’s Christmas City vision could ever achieve. 27 On December 26, the front page of the article declared 1941 one of the best Christmases since pre-Depression years due to more gift-giving made possible by increased employment and bigger payrolls. 28 As the city’s economic future became less certain in the following decades, Christmas City would be reimagined to again stabilize the community.

Bethlehem Christmas Lights, North and South, 1940s. Bethlehem has two downtowns, one on each side of the river. In the 1940s, both shopping districts—Broad Street on the North (top) and Third Street on the South (bottom)—were decorated with the same multicolored lights. By the 1960s there would be a general understanding that the North Side would string only white lights and multicolored lighted would be relegated to the South Side. (Private Collection of Bill Weiner from Lehigh University’s Beyond Steel: An Archive of Lehigh Valley Industry and Culture).
Redeveloping Christmas City: 1950–80
The Bethlehem Steel Corporation continued to prosper after the war, but it was becoming clear by the late 1950s that the city needed to diversify its economy. Even as Bethlehem’s population grew by almost a third between 1940 and 1960 to peak at just over 75,000, in 1957 the Steel accounted for 54 percent of all salaries and wages earned by Bethlehem residents and represented the only industrial expansion within the city. 29 In response, a group of local businessmen from the Chamber of Commerce’s Economic Development Committee formed Lehigh Valley Industrial Park, Inc. in May 1959 to attract more varied employers to the area. That summer, steelworkers nationwide went on strike over whether industry management could arbitrarily change work practices and conditions. The strike lasted 116 days, affecting virtually every local business that relied on Steel wages or contracts. Executives, blamed for mismanagement, pointed fingers at the union, saying that many domestic steel buyers turned to less expensive foreign and nonunion companies to fill orders during the strike. The causes of decline are complex and not mutually exclusive, but the strike undeniably fueled fears in the city of an untenable Steel-centric future. 30
As federal grants became available for urban renewal in the Housing Acts of 1949 and 1954, legislation buttressed by Pennsylvania’s Urban Redevelopment Law of 1945, the city of Bethlehem found further impetus to reshape the landscape. 31 By 1966, the city reported revitalization plans costing $17.5 million, more than half of which ($9.1 million) came from federal grants. 32 Efforts coalesced around an “interim report” from the city’s Redevelopment Authority in 1956. The consulting firm on the report was Clarke & Rapuano, Inc., influential New York planners and landscape architects with close ties to renewal guru Robert Moses. Funded in part by the Steel, the firm would continue to inform Bethlehem’s redevelopment plans for the next decade and a half. Like Melhado, the authors placed endeavors to reinvigorate the city’s North Side central business district within the context of tensions in Bethlehem’s landscape, “a division of effort between north and south Bethlehem.” 33
As has been argued elsewhere, the term urban renewal during the postwar period often veiled agendas to clear cities’ poor and ethnically marginal neighborhoods for more “profitable” uses. 34 Bethlehem’s report notes that the decline of residential and business districts on the South Side represented one of Bethlehem’s most serious problems, comprising five of seven designated redevelopment areas. 35 In the most costly of these projects, the city declared the entire South Side working-class neighborhood of Northampton Heights “blighted” in 1965 (Figure 4). The inspection, performed explicitly to meet requirements for federal renewal funding, found evidence of overcrowding, fire code violations, and lack of hot water, toilets, heat, and electricity. 36 One of the most ethnically mixed neighborhoods in Bethlehem, a majority of the 945 residents of the twenty-block area depended upon employment at the steel plant that encircled it. The company expressed interest in the site, purchased (via the Redevelopment Authority) the 280 homes, and by 1968 razed the Heights to make way for a new basic oxygen furnace to modernize its steel production. 37

Northampton Heights, 1966. Bethlehem Redevelopment Authority graphics show plans to raise the entire neighborhood of Northampton Heights, Bethlehem’s most racially mixed area, as part of an urban renewal project. Bethlehem Steel, which surrounded the neighborhood, built a new basic oxygen furnace on the site in 1968. After the Steel’s closure in 1998 the site was cleared again. It now hosts office buildings and light industry. (Collection of Frank Podleiszek; Bethlehem, PA Redevelopment Authority, 1966 Annual Report, Bethlehem Area Public Library).
Many residents appreciated the cash to move out and into nicer homes. In exchange, the Steel promised that updated technology would increase job stability. 38 But Fred Novak is among those who dispute the blight designation. As in other communities, the nebulous process of “blighting” was as much a political construct as an empirical condition. Mimicking the favorite renewal metaphors of the time, the district’s congressman ominously called the Heights, “a symptom of the kind of urban decay which begins in an isolated spot in a city and then spreads, slowly, like a cancer, to adjoining areas and, eventually to an entire section of our city.” 39 While certain blocks of the neighborhood were falling into disrepair, the majority, Fred claims, comprised well-maintained and respectable housing and businesses. Indeed, less than half of the homes had failed the inspection. Fred describes his 1910s three-story brick double on Fourth Street with fondness, recounting how oak pocket doors concealed the parlor for much of December, opening on Christmas morning to reveal a tree and elaborate putz display. His steelworker father, the son of Slovenian immigrants, refused to leave the home when it was condemned until after the water and electricity were turned off. “When they were tearing that house down,” Fred says, “they had the steel ball to knock it. It just kept bouncing off the wall. The wall would not crumble.” 40
As urban renewal brought class boundaries into relief, changes in Bethlehem’s holiday celebrations at the time likewise reasserted distinctions in the landscape. In 1954, the city discontinued its multicolored lighting displays, declaring the associated traffic jams a safety hazard. Toned-down, clear white lamps replaced the usual garish Christmas lighting. 41 By the 1960s there was a general municipal agreement that the North Side would string only white lights, and multicolored lights would be relegated south of the river. 42 A tour guide in 2000 explained—and one can hear near identical language on bus tours of the decorations today—“the white lights decorating the city’s north side represent the Moravian heritage brought here by those first settlers, while the multicolored lights that adorn the south side are thought of as representing the ethnic diversity of many more who came from many nations to help make this city great.” 43
The cheery language masks the deeper class divisions that the lighting shift in the 1960s reinscribed onto Bethlehem’s Christmas landscape. The description of Bethlehem’s “distinguished” and “tasteful” North Side Christmas display, implying its South Side opposite, has permeated most descriptions of Christmas City since. For example, an elderly North Side resident who insists on putting colored lights on her Christmas tree even though she lives in the Moravian historic district recounts a recent scolding by a neighbor who declared, “I think it’s terrible that you have all those colored lights … They belong on the South Side with the Puerto Ricans!”—Puerto Ricans being the most recent racialized shorthand for Bethlehem’s poor and ethnic other. 44
The 1950s also brought to Bethlehem a burgeoning interest in historic preservation. Clarke & Rapuano's planning proposals for the most part emphasized new construction, but they gave exception to the Moravian quarter, citing other cities, including Boston, New Orleans, Charleston, and Winston–Salem, as examples of how creating a historic district could boost downtown business. 45 In the 1956 report, the authors drafted city legislation to define a “Historic Bethlehem District,” requiring approval of design, materials, and color for all new construction or alterations to existing structures within the area. 46 The legislation passed in 1961, and eleven years later the historic district joined the nascent National Register of Historic Places. 47 Federal urban renewal grants were used in 1963 to clear ten acres in the district along the Monocacy Creek where the original Moravian industrial works had been overwhelmed by an automobile junkyard. Some of the land was developed for high-rise senior housing, but the City subsequently leased most of the plot to Historic Bethlehem, Inc. for restoration and development as a heritage attraction (Figure 5). This not-for-profit group, buttressed by the support of Steel executive wives and other social and political elite, formed in 1957 around what it called “historic renewal.” 48 As Historic Bethlehem, Inc. president in 1962, Frederick Warnecke, explained, “We expect to see a new Bethlehem built on the old foundations. This will be the finest kind of urban renewal—a kind that conserves the past yet faces the needs of the living present in new and contemporary terms and dreams of a bright future that may well be quite different from either past or present.” 49

Moravian Colonial Industrial Quarter, 1957 (top) and today (bottom). The city used federal urban renewal funds to clear blighted land along the Monocacy Creek in 1963. Nonprofit Historic Bethlehem, Inc. then restored the plot’s eighteenth- and nineteenth-century buildings: a tannery, waterworks, grist mill, and smithy (Historic Bethlehem Partnership, Inc., Bethlehem, PA; Paul S. Bartholomew, 2011).
It is tempting to narrate a shift during these postwar decades from razing to rehabilitation, a possibility newly enabled by 1954 Housing Act amendments, but as Warnecke’s words suggest, in many respects destruction and preservation played off and supported each other in more complex ways, particularly as Moravian heritage was invoked toward both ends. 50 City planners described the downtown area as overcrowded, “defective in design and arrangement,” and affected by “economically and socially undesirable use.” 51 A 1961 article in the New York Herald Tribune likewise describes Bethlehem as being faced with “inner rot. Congestion, grime and obsolescence were all eating away at its core, and where there had once been thriving downtown areas that were a source of pride to citizens, industrial and residential slums were gradually taking over.” 52 While similar descriptions nationwide backed plans to tear down old structures and replace them with modern buildings, the same article lauds Bethlehem’s Moravian heritage as a renewal asset, mimicking the language of nineteenth-century visitors who contrasted Moravian purity with the chaos of urbanization.
Late 1950s and early 1960s redevelopment models in Society Hill, Philadelphia, and College Hill, Providence also emphasized those residential neighborhoods’ historic characters as assets, but they were not rehabilitated as heritage tourism sites in themselves. More similar to Bethlehem’s “historic renewal” was an effort underway in Portsmouth, New Hampshire between 1957 and 1965 that involved changing state law to allow the use of urban renewal money to restore the Puddle Dock neighborhood and create the Strawbery Banke outdoor colonial museum. 53 Though Portsmouth self-promotes as the first city to use renewal funds in this way, Bethlehem was clearly in step on the forefront. It was featured, alongside Portsmouth and six other small cities, in 1962 by the National Association of Housing and Redevelopment Officials as a model of partnership between “renewers” and preservationists. The professional group’s article was quickly adapted and sold as a booklet by the federal Urban Renewal Authority. As the authors write, this “happy combination” could “bring the warmth of friendship to renewal from those who may have seen the program only as a harsh destroyer and heartless displacer.” 54
This union, however, was not sealed so readily. Despite Clarke & Rapuano's support of the contained historic district on Bethlehem’s North Side, the firm drew up plans in 1969 to revitalize the adjacent Broad Street shopping district by razing buildings on several blocks for the creation of a modern shopping mall, office towers, and a parking garage. The Sun Inn, a historic structure dating to 1758, was to be torn down and replaced by two high-rise office buildings, “one containing a major bank.” 55 If preservation was necessary, Clarke & Rapuano suggested that the Inn be relocated closer to the other Moravian buildings so as not to clash with the new construction (Figure 6). 56 Paralleling the concurrent rise and fall of a similar mall development scheme in nearby Lancaster, this Center City plan advanced with limited opposition through the early 1970s. Support waned and the project was halted in 1976, however, when new investments, tenants for the mall, and other construction failed to materialize. 57 Saved from demolition, the Sun Inn was restored to its original condition on its original site in 1981.

Broad Street Redevelopment, 1969–1976 . This 1970 drawing from Clarke & Rapuano (top) suggests moving the 1758 Sun Inn, a host to George Washington, John Adams, and other colonial notables, because it is “out of character and scale” with plans for new office-tower redevelopment in the North Side’s downtown. The new construction on the adjacent block, the model of which is shown here (bottom), was halted in 1976 before it reached the Inn, which preservationists then successfully restored. (Clarke & Rapuano, Inc. Sun Inn: An Examination of Four Sites, 1970; Clarke & Rapuano, Inc. “Design and Planning Photo Album,” n.d., Clarke and Rapuano Records, 1940-1993 (#3074), Division of Rare and Manuscript Collections, Cornell University Library).
During this period of “historic renewal,” newspapers reported record numbers of tourists in the area during the Christmas season, drawn by holiday events almost entirely focused on Bethlehem’s Moravian heritage. These included walking tours of the Moravian buildings by guides dressed in period costume, visits to the community putz, and services at Central Moravian Church. 58 A 1958 pamphlet from the Chamber of Commerce touts Bethlehem’s “non-commercial and dignified observance of the Christmas season,” and later boosters maintained that visitors came to Bethlehem to escape the commercialism and garish displays found elsewhere. 59 Still, in 1966, Bethlehem’s Christmas lighting display included 15,000 lights, an eighty-foot tree on the Hill-to-Hill Bridge (constructed of ninety-seven smaller trees fastened to a wooden framework), and 465 small trees throughout the city. By the end of the decade, the putz regularly attracted more than 10,000 visitors, with numbers trending upward and thousands more going on bus tours of the lights and to other holiday attractions. 60
While Christmas City initially used its lighted landscape to attract visitors to its downtown retailers, by the 1960s Bethlehem had shifted to selling the “heritage landscape” itself. Such destinations often have popular associations with durability, dependability, and traditional values. Christmas tours of the Moravian buildings in Bethlehem stress the founders’ spirituality, ethic of hard work, self-sufficiency, nonmaterialism, and unity. 61 Nonetheless, Melhado’s drive to bring money to local businesses lies just below the surface. As the director of Historic Bethlehem, Inc. wrote in 1967, “preservation mania” attracts “an ever increasing touring public. And with the tourist comes the tourist dollar.” 62 Historic Bethlehem, Inc. stocked its gift shop extra full during the holiday season with Christmas cards, Moravian cookies, straw stars, putzes, and other festive items. 63
This tension between modernization and preservation that characterized Bethlehem during the period of urban renewal is perhaps best expressed in plans for one of the city’s last major acts of federally subsidized demolition, the new city hall. The concept for the City Center, which included the police headquarters and the public library, had also been part of the 1956 Redevelopment Authority report. Consultants Clarke & Rapuano suggested, again, that the plan could help unite North and South. The site of the project, significantly, was near the old Moravian settlement, and its proposed federal-style architecture mimicked the Central Moravian Church, built in 1803 (Figure 7). The artist’s rendering of the structure looks south, juxtaposing lush North Side environs with the smoke-covered steel plant across the river. The image leaves no question of the city’s persistent division, both geographically and in the cultural imagination. 64 One hundred homes ultimately were razed at the proposed North Side site to make way for construction of the City Center in 1967, though the new buildings are in a modern architectural style that makes more visible use of structural steel (Figure 8). The Steel Company contributed half a million dollars, matching community donations toward the $11 million project, otherwise heavily subsidized with federal urban renewal funds. 65

Proposal for the New City Center, 1956. This artist rendering of the proposal (top) is on the North Side looking south across the river to the smoke-covered steel plant. The proposed federal-style architecture of City Hall mimics that of the Central Moravian Church (bottom), built in 1803 (Clarke & Rapuano and Russell Vannest Black, An Interim Report on the City of Bethlehem, 1956, Bethlehem Area Public Library; Historic American Buildings Survey, 1969, Library of Congress).

City Center, 1967. The actual complex, completed with the help of federal urban renewal funds in 1967, boasts a modern design that highlights structural steel. (Bethlehem City Center Built in a Proud City by Proud People, 1967, Bethlehem Area Public Library).
The center’s plaza also became the new home for the city’s Christmas tree, where it stands next to a sixty-foot sculpture made of Bethlehem steel entitled “Symbol of Progress.” The sculptor explained that the piece represents the integration of the city’s various ethnic groups, “progressing skyward as they are strengthened by their diverse beginnings and their subsequent meeting.” 66 Over the years, a handful of Christmas City events with roots in the South Side were added to the holiday program. Our Lady of Pompeii, a South Side Italian-American Catholic church, hosted the first “live Christmas pageant” in 1978. Within three years it included a cast of more than 300 people and animals. 67 Other churches offer carol services in a variety of languages, and a hotel on the South Side hosts an annual display of “ethnic” Christmas trees. The majority of activities nonetheless remain north of the river.
The culmination of the revitalization efforts that the 1956 report sparked was the Main Street Improvement Project completed in 1978. In contrast to the earlier Broad Street renewal project that emphasized new, modern construction, the Main Street project on the adjacent blocks involved replacing electric streetlights with Victorian-style light fixtures, widening the sidewalks and paving them with brick and stone, planting more trees, and remodeling nineteenth-century storefronts to “historically appropriate” designs (Figure 9). 68 The Steel funded a 1976 study by the Urban Land Institute that “strongly urged” going forward with the plan. “A curious thing has happened on Main Street,” the authors wrote. “Formerly the merchants were inclined to be ashamed of the old-fashioned building that extended two, three, four stories above their new shop fronts. Now the situation is reversed, and the fine Victorian architecture has achieved a new prestige.” The ULI study concluded that the city should expand its restoration and renovation efforts, halt demolition and clearance activity on Broad Street, and focus on enhancing the tourism potential of its Moravian heritage. 69 In 1981, as the city geared up for another Christmas season, anticipating 30,000 holiday visitors, Columbia University graduate students in a fall course on “Downtown Revitalization” toured Bethlehem’s Main Street as an example of success. 70

Main street improvement project, 1978 . These views in March (top) and December (bottom) 1978 show the transformation of the North Side’s Main Street as street lights are replaced with Victorian lamps and the sidewalks are made more pedestrian friendly (John Milner Associates, Inc., Bethlehem Area Public Library).
Defining Christmas City in the Twenty-First Century
From their foundings, Bethlehem’s North and South Sides were imagined as inverses, a distinction that Christmas City helped maintain. Efforts to unite Bethlehem using Christmas beginning in 1937 were grounded in North Side locales, and overtures to South Side integration never cast the classed characterization of its “ethnic” attributes. Historic preservation initiatives that gained traction during the 1960s exaggerated the nostalgia that had painted the Moravian settlement as quaint, timeless, and tasteful for over two centuries, simultaneously clearing the way for “renewal” and modernization of less appealing neighborhoods.
The contrast between the regulated space of the Moravian historic district and the sprawling instability of the steel plant across the river became particularly pronounced during the industrial downsizing of the 1980s. By 1990, employment at the Bethlehem plant had plummeted below Depression levels, and in 1995 Bethlehem Steel stopped making steel in Bethlehem. 71 The city, following the diversification trajectory it began in the 1930s, determined to enhance its tourism revenues. The summer of 1984 inaugurated a nine-day, vaguely German-themed music festival along the Main Street, Broad Street, and Moravian Industrial Quarter areas. By 1995 Musikfest regularly attracted one million people to Bethlehem’s downtown each August. In the mid-1990s, Bethlehem began lighting its star atop South Mountain year-round, and blue city signs saying “Follow the Star to Bethlehem” direct visitors downtown. In 1998, the remainder of the steel plant ceased operations, and three years later the corporation filed for bankruptcy.
So now Bethlehem has to deal with a new historic district (or blighted landscape depending on one’s perspective)—the barren steel plant that occupies much of the city’s South Side. Rather than raze the plant in its entirety and rebuild as has been the case in many other deindustrialized towns, the city has decided on a similar approach to “historic renewal” as it took to the North Side business district and Moravian complex fifty years earlier. Selected Steel buildings will be rehabilitated for reuse as shops, restaurants, and residential space, an industrial history museum, and a visitors’ center. But instead of referring to local redevelopment experience, the revitalization plan initially pointed to big-city projects as a guide. As plant operations winded down in the mid-1990s, the Steel Corporation hired Enterprise Development, a nationally recognized affiliate of “festival marketplace” guru James Rouse’s firm, and held up as a model Philadelphia’s plans to redevelop its waterfront through mixed retail, entertainment, and heritage attractions. 72
Other cities’ efforts offer examples for Bethlehem in a new era of redevelopment funding. While postwar urban renewal in Bethlehem was heavily subsidized by federal dollars as well as the Steel’s corporate largesse, the balance today, as in most urban locales, has tipped decidedly toward private investment. For Bethlehem, a turning point came with Pennsylvania’s legalization of casino gambling in 2004. Multinational casino resort developer Las Vegas Sands Corp. opened a $743 million industrial-themed casino on the site of the plant’s ore yards in 2009, dwarfing the impact of federal and state development grants. The Sands’ red neon sign hangs on an original ore bridge (Figure 10). The casino corporation also dramatically lights the five blast furnaces that silently line the south bank of the river, creating a competing tourist beacon to the Christmas Star and a new symbolic branding of the city’s heritage (Figure 11). Bethlehem’s residents divided over the casino project. While some lauded the jobs, tax revenue, and tourists the new enterprise could bring to the area, others found the project incompatible with their conception of the Bethlehem community. As one resident said, “It is painful to think of the Star of Bethlehem overlooking a gambling casino. Christmas City and Sin City simply do not go together.” 73

Sands Casino-Resort Bethlehem, 2009. With the legalization of casino gambling in Pennsylvania in 2004, Bethlehem attracted the interest of the Las Vegas Sands Corp. to redevelop its South Side brownfield. The industrial-themed casino, which opened in 2009, sits on the steel plant’s former ore yard, and the neon sign hangs on an original ore bridge. (Michael McNett, Las Vegas Sands Corp.).

Blast Furnaces, 2011. The plant’s blast furnaces are a new heritage attraction in Bethlehem and are, like the Star of Bethlehem, lit each night. A Christmas tree topped with a Moravian star is part of seasonal decorations. (Photo by author, 2011).
Whether the casino will provide a stable economic future for the community long term, or whether social costs will ultimately outweigh the benefits, remains an open question, but so far it has provided almost 2,000 new jobs and entertains 19,000 people every day, half of whom come from outside the area. 74 In contrast to Rust Belt cities like Youngstown, Ohio, or Flint, Michigan, that hemorrhaged residents with the loss of major manufacturers and became symbols of postindustrial urban decline, Bethlehem’s population never dropped below 70,000 and has since recovered to near peak levels. In addition to the casino, a diversified regional economy of health care and educational institutions, technology firms, and warehouse and distribution centers has helped the city’s tax base rebound after the Steel’s decline. 75 A 2012 study ranked Bethlehem number one among thirteen small manufacturing cities in the Philadelphia area in terms of economic health, declaring it “relatively prosperous.” The report specifically notes Bethlehem’s success in using history and culture to fashion an image as a tourist destination. Still, the economic health of the community is uneven, as Bethlehem’s Latinos, most of whom live on the South Side, remain significantly less well off than their white counterparts. 76
The history of Christmas City in Bethlehem reveals that the unity Vernon Melhado strived for between North and South has never been accomplished, but neither have the divisions between the Moravian North Side and the steel-town South Side been as natural as some residents imagined and continue to believe. Urban renewal, often characterized as a modernist project with no interest in the past, likewise emerges as a more complex story, as heritage tourism underpinned plans for a revitalized economic future at the same time that whole neighborhoods were razed to make room for new construction. By creating a public image of Christmas City to present to outsiders, the city of Bethlehem revealed internal tensions to itself. These divisions in the landscape—geographic and cultural, spiritual and economic—promise to resurface and require negotiation long into the future. Bethlehem’s residents, local officials, and business interests would do well to remember the city’s past successes in preserving its heritage assets, as well as its failures to adequately protect many homes and small businesses from bulldozers and corporate interests. Just as the experiences of small cities have much to add to urban renewal literature, Bethlehem stakeholders would be remiss to look only at the “tourist city” models of larger urban centers to the exclusion of its own redevelopment history.
Footnotes
Acknowledgments
The author would like to thank Dolores Hayden, Howard Gillette, the several commentators on an earlier version of this article at the 2011 SACRPH conference in Baltimore, and Christopher Silver and his two anonymous reviewers for their helpful feedback. The author thanks Lanie Graf at the Moravian Archives, Amy Frey at Historic Bethlehem Partnership, and the many other resources in Bethlehem who helped locate materials for this project.
Declaration of Conflicting Interests
The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.
Funding
The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: The research for this article was funded in part by Yale University's John Morton Blum Fellowship in American History and Culture.
