Starting in 1961, New York City was running annual current account deficits; the City’s revenues could not fund their current expenditures and debt payments. By 1974, in the midst of the second recession of the decade, the annual deficit had reach $487 million. The City maintained spending and services by borrowing to cover these operating expenditures. In 1974, New York City borrowed $2.2 billion to offset deficits and finance other capital projects. In the same year, the City’s outstanding debt had reached $13.5 billion.In 1975, the banks reviewed the City’s revenue projections and decided they would no longer underwrite the notes and bonds of New York City. The City could no longer borrow money to operate and by April of 1975, New York City ran out of money. City leaders turned to the federal government and the State looking for the funds required to avoid bankruptcy. Eventually, Governor Hugh Carey agreed to advance the City funds from the State in exchange for the City turning financial oversight to the State. The outcome was the creation of the Municipal Assistance Corporation (MAC). The MAC was authorized to sell bonds to meet the City’s borrowing needs.
Covered, Oct 16, 1975
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On October 16, 1975, New York City was on the brink of bankruptcy, with debts of $453 million due and only $34 million available. The city's leaders, including Mayor Abraham Beame and Governor Hugh Carey, scrambled to avoid default. Pension funds, particularly the Teachers' Retirement System, were seen as the last resort. After intense negotiations, the teachers' union agreed to fund the city's shortfall, saving New York from financial collapse.
Published, Oct 30, 1975
President Ford’s refusal to initially aid the city led to his infamous association with the headline, "Ford to City: Drop Dead."
1977 - US president Jimmy Carter and New York mayor Abe Beame tour an abandoned block in the South Bronx
Uncollected garbage burns in Manhattan’s Lower East Side during a period when New York felt close to complete collapse
Striking New York garbagemen stand by signs reading “Stink City” AND “Abe is nuts”
Residents of South Bronx play cards in an abandoned cafe – the Bronx, bastion of upper-middle-class living until the mid-60s, burned regularly a decade later
1975 - New York City police officers march at the city’s St Patrick’s Day Parade
1977 - During one of the city’s many power failures, police challenge suspected looters in the Bronx
1977 - An NYC fire unit tackles a South Bronx fire – firefighters rushed to thousands of false alarms, and were often bombarded with bricks and garbage.
1975 - Mayor Abraham Beame
1975 - Children cool themselves with a fire hydrant on a hot summer’s day in New York’s Lower East Side.
1975 - An abandoned car in Harlem during the summer. ‘It’s difficult to convey just how precarious life in New York felt around that time.’
1975 - Covered - Drawings and documents
4 Documents,Show less
1975 - Beame to fire 4000 workers
1975 - Published
2 Results,Show less
1975 - Published - Drawings and documents
2 Documents,Show less
1975 - Ford to City: Drop Dead
1975 - Mayor Abe Beame shows off the infamous New York Daily News front page