Well that is what actually happened to allow the City of New York to recover from the 1970s. In a “real” sense it only paid half, or less, of its debt and pension obligations. Not by formally going bankrupt the way Detroit did. Not by the people in the room agreeing to get less than they had promised themselves. They agreed to get every dime, as noted.

The City of New York paid half and less by paying a fixed amount in dollars, as the value of the dollar fell by half from 1970 to 1980, as a result of inflation. The bondholders and pensioners of 1980 found that the big tax-exempt score they had made in 1960s and early 1970s had been cut in half. It would then fall further. As one can see by using the Consumer Price Index calculator from the Bureau of Labor Statistics,

Labels: history, local, New York

# posted by Squach : 7:08 AM   |  0 comments