Sunday, December 09, 2007

December 9, 1975:

Ford to New York: Don't Drop Dead After All

The New York Daily News published on of the most famous headlines of the 1970s in the fall of 1975: "Ford to City: Drop Dead." The city was on the verge of bankruptcy and wanted federal assistance. President Ford was a little more than reluctant to agree to whatever bailout Congress might provide. As the story under the headline said:

"President Ford declared flatly today that he would veto any bill calling for 'a federal bail-out of New York City' and instead proposed legislation that would make it easier for the city to go into bankruptcy.

"In a speech before the National Press Club, Ford coupled repeated attacks on the city’s fiscal management with a promise that if default came, the federal government would see to it that 'essential public services for the people of New York City' would be maintained...

"The ferocity of Ford’s attack on the city’s spending – he likened it to an 'insidious disease' – appeared to doom chances for passage of any congressional plan to help New York avert default through federal loan guarantees.

" 'I can tell you now that I am prepared to veto any bill that has as its purpose a federal bailout of New York City to prevent a default,' the President said."

On December 9, 1975, however, Ford did sign another sort of a fiscal rescue for the city of New York -- a series of loans that Congress had approved, $2.3 billion each year through mid-1978. Each loan had to be repaid within the year it was made.

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