New York City Scale
Beginning on a global stage, the 1970s saw New York City grappling with an economic depression. According to the article "A Crisis Without Keynes: The The 1975 New York City Fiscal Crisis Revisited", the key factor contributing to this crisis was a significant downturn in the real economy, which became particularly severe by the mid-1970s. As with other cities undergoing deindustrialization, New York suffered from a substantial loss of firms, jobs, and population. From 1969 to 1976, the city witnessed the departure of roughly 1,000 industrial firms annually. This exodus led to a dramatic decrease of 500,000 manufacturing jobs within the same timeframe, escalating the unemployment rate to ten percent and reducing the city's industrial workforce by half from its post-war zenith of just over one million. Alongside the vanishing jobs and firms, New York also saw a mass exodus of its residents. Between 1970 and 1975, the city lost 11,000 housing units to abandonment and demolition, setting the stage for a decline of nearly one million residents by the decade's end (Reagan).
Even worse, by the spring of 1975, the financial crisis had reached a critical point, allowing banks to exert significant leverage over New York City's finances. They began making extraordinary demands to secure guarantees on future funding. This involved requesting daily updates on city expenses—details that the city was not equipped to provide due to limitations in their financial reporting systems. By the time summer rolled around, the banks' demands had escalated further. They insisted on severe and unprecedented cuts in municipal spending. These reductions targeted vital and popular public services, including the elimination of free tuition at the City University of New York (CUNY), an increase in the subway fare from thirty-five cents, cuts to public education budgets, the closure of hospitals, and other significant cutbacks across various sectors (Reagan). As shown in the graph, the expenditure was decreasing from 1975 to 1978.
In 1975, a strike by 10,000 sanitation workers erupted in response to the city's decision to lay off 2,934 employees from their department. As a result, heaps of garbage remained uncollected, piling up outside a subway entrance on East 14th Street near Union Square.
Some neighborhoods experienced such extensive damage from fires, theft, and vandalism that local businesses were forced to close. At the intersection of Utica and Union Streets and Eastern Parkway in Brooklyn, pedestrians looked on at the devastated storefronts and debris left behind from a night of rampant looting.
During the challenging global economic climate of the 1970s, educational institutions in New York City, including the Polytechnic Institute, faced significant difficulties. The city's financial crisis, marked by budget cuts and fiscal constraints, impacted the operations and financial stability of many such institutions. Furthermore, the dismal job market compounded these challenges, as graduates faced increasing difficulties in securing employment, thereby affecting student enrollment and morale. The Polytechnic Institute, like others, struggled with decreased funding, which likely affected its ability to maintain programs, attract and retain faculty, and invest in necessary resources.