Could New York Go Bankrupt Again?

Today’s guest is Richard E. Farley, author of Drop Dead, a history of how the richest city in America got addicted to spending, saturated in debt, and crashed the municipal bond market—and then managed to get a federal bailout in the nick of time.

Fifty years ago, in 1975, New York City almost went bankrupt. Farley argues that the same conditions are re-emerging today: runaway budgets, gimmicky accounting, overpromised entitlements, and politicians more interested in ideology than arithmetic. And Farley wrote all that before the rise of Mamdani, who promises to blow spending through the roof, enact new taxes, and create masses of new regulations.

If you want to understand what it takes to bankrupt a city, listen up. Because New York might be sleepwalking into another fiscal disaster, and this time, there might not be a bailout waiting.

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0:00 – Intro
1:24 – Zohran Mamdani’s agenda and its economic risks
6:03 – How New York went broke in 1975
8:21 - Budget fraud and political chicanery
12:20 – Out of control spending
16:20 – Municipal bond market saturation
20:11 – Bailout politics of Beame, Carey, and Ford
31:47 – Who is Felix “the Fixer” Rohatyn?
36:37 - Why the budget grew during the Austerity Era
38:59 – How NYC returned to budget normalcy
42:53 – Is New York repeating the mistakes of its past?
47:00 - Eric Adams and Andrew Cuomo
50:12 – Why NYC won’t return to the Bloomberg model
56:32 – Generation gaps and voter behavior

Producer: Paul Alexander
Audio Mixer: Ian Keyser
Illustration: Eddie Marshall