By 1975, New York City was $14 billion in debt (with a large chunk of this in high interest, short-term loans). As the Big Apple bled revenue, its ability to maintain itself (municipal employees, infrastructural upkeep, daily services) through collected tax monies shrank. In lieu of tax revenue, NYCs policy-makers kept pushing municipal bonds, hoping for continual underwriters. For some time, this workedmunicipal bonds were generally a good bet (to ensure the image of solvency and maintain the publics trust, they were guaranteed: in case of default, the state of New York would pay back bond/debt holders through raised taxes.too, bond holders didnt have to pay income taxes on the interest earned). But, as the 1970s wore on, major credit rating agencies (Standard and Poor, Moodys) down-graded NYCs investment status (to non-investment statusa BB-). At this point, New Yorks representatives began tying to push non-guaranteed bonds (the idea was on good faith, theyd be payed back, but again, not guaranteed). Major banks refused to buy any more bonds, and the city was on the precipice of default. With the capital of capitalism technically bankrupt, no one knew what might happen if the city defaulted (its effects would be felt far beyond the Big Apples borders). Major financial and business players, with backing from a conservative Fed (which had moved rightward politically since the failures of the Great Society), forced an austerity package on the citythis was the only way the banks were willing to roll over the debt. This meant the cutting of social services and aid to the poor: first came repayment (think of modern Greece, for example). Two agencies, the MAC (Municipal Assistance Corporation) and the EFCB (Emergency Financial Control Board) had complete control over the citys financesnot democratically elected reps, but bankers and business elites who viewed the citys woes as stemming from too liberal of policies (too generous to the working-classes, the poor, and minorities). This devastated poor communities. Eventually, through planned shrinkage the city cut services to the South Bronx, Central and Eastern Harlem, the Lower East Side, and Central and Eastern Brooklyn (all poor minority neighborhoods)the idea was: if you cut vital services to these areas that were seen as untenable, then you will shrink those populations because they will be forced to leave. But where would the poorest go? Wellas the city burnt down around them, they actually found opportunities to rethink their neighborhoods. And, there was no authority presence to stop them. Out of this environment, people squatted and refurbished houses; people built community gardens and farms; people created hip hop culture and threw block parties. Over the next decade, these areas of the city would be up for grabslocals began to rethink them, but city policy-makers, now beholden to corporate and financial elites like never before, too looked to rethink these burnt-over areas (some have suggested they allowed them to burn down precisely to rebuild anewto wipe away the ghettos for good). Readings and Question/s: Read in this exact order: First, read pages 6-16 (The Transformation of New York) of Beach Beneath the Streets (this reading, unfortunately, is paired with another preceding reading (To Go Again to Hyde Park)you do NOT need to read anything but what Ive noted abovepages 6-16 of Beach Beneath the Streets). After reading pages 6-16, THEN read Josh Freemans chapter, The Fiscal Crisis. After those readings, watch the entirety of the documentary: 1977: The Coolest Year in Hell (found at: https://www.youtube.com/watch?v=rHXAYddPLsM ).Question: Discuss the nature of the fiscal crisis: how did it affect groups (the wealthy, the poor, etc.) differently (and be specific, using the readings and doc). Also, why, in the midst of economic and social breakdown, did new forms of culture, esp. youth culture, flourish (and in particular, how did the spaces of abandonment work as a catalyst for this cultural explosion)?