That one problem that Ken Livingston does not have to face is that his city might go bankrupt since central government underwrites London's borrowing. That's not the case in American cities. New York, the most vibrant, exciting city in America, the Big Apple, one hell of a town. Every cliche you've ever heard about the place is true. Manhattan is a life proud of itself and winning. Everywhere there is the thump of pneumatic drills, the whine of a dump truck, the coppery smell of quick money. It's hard to believe that seven years ago this city faced bankruptcy with debts approaching a staggering $2,000 million. Then, there were just two major construction sites in New York. Today, there are 329. The near fatal hemorrhage of jobs and people from the city has been slowed, stopped and reversed in just seven years. How has the magic worked? A surprisingly modest City Hall carves at the feet of Wall Street skyscrapers. When the city looked like defaulting, the shadow of Wall Street became all too substantial. The bankers moved in like a firm of liquidators. Their chosen instrument, Felix Rohatyn had a suitably low opinion of politicians. Politicians with money are like kids with marijuana and you have to tell them you know, this is all you've got. This convention center will bring jobs and money into the rundown Docklands area of the West side. It will be as long as the Empire State Building is tall. AT&T have just built new head office with a thousand jobs in midtown Manhattan and IBM have arrived with another 2,000. The Trump Tower when it's completed will be $400 million worth of high priced apartments, commercial space and boutiques. What's happened is phenomenal. I've never seen anything to the extent that I have in New York. Now, from a real estate standpoint has probably become the hottest city in the world. People are flocking here by groves and I guess a lot of things had to do with it. Mostly, I feel it was the psychology of making New York a winner as opposed to a loser. It's a nice line, but straight public relations. The tax holiday that the Trump Organization was given to build this hotel in 42nd Street is worth $45 million, but Donald Trump wouldn't dream of blushing. Probably, it's the greatest thing that city ever did and I think the city is the first to acknowledge it. They went overboard, they gave a tremendous break for the first time. Actually, in the history of New York, we got this commercial tax abatement. We took a building that had one person working. We now employ 2,000 people and we employed during peak construction periods over 4,000 people, so the city is the big winner. I might add one other thing, I would have never built the development if I didn't get the tax abatement. New Yorkers sucked jobs back into the city. New jobs, be new taxpayers, new ratepayers. The taxpayers of New York has increased by $3,000 million in seven years and the turning tide has washed back quite a few of the frightened middle class New Yorkers who left when times were bad. Do you find New York as saner, less violent, less frightening place than when you left it? I think so, especially in certain neighborhoods, certain pockets. I think people have been drawn together for many reasons over the years politically and realized that they need to work together on a much more broad scale than before. The threat of bankruptcy might have had some quite good social effects. Possibly, that kind of thing always brings New Yorkers together. Blackouts, threat of bankruptcy, any kind of thing like that tends to bring the community together. And the community is increasingly middle class. It has to be. A tax subsidized development by Trump has turned a rundown area like 42nd Street into a desirable address. SoHo used to be a low rent garment district. Today, property prices and rents are sky high, shops and restaurants are mushrooming and the working class have moved out. It's all very reminiscent of visiting to than the late '60s when the bank has told New York there was no such thing as a free lunch, they removed the power of the vote from the people who might object. Which may be why the South Bronx makes a deprived area like new and look like paradise. Dispossessed by a boom that was engineered largely at their expense, it was blue collar jobs that were axed and welfare payments were cut to pay for Donald Trump's tax breaks. The poor of this area grew so desperate a few years ago that they started to burn down their homes. Manhattan may be thriving, but crime has rocketed by 25% in two years and parts of the city are in agony. Felix Rohatyn would argue that without Richman's table, there are no crumbs for the poor. I think in a democratic society, it is very difficult to legislate sacrifice. I think when you have growth, you can legislate growth, you can allocate it among the various constituencies and as long as there's a rough element of justice to it, and everybody gets his little piece of it in one way or another, you have a minimum of dislocations. I think when it comes to functioning under a limited amount of resources or a shrinking amount of resources where you really have to allocate sacrifice. It's very difficult to do that under the existing political structures and therefore, structures like Mac or the Financial Control Board which are as you say is somewhat autocratic. At least afford both the politicians, the labor leaders, all those elected officials who have to justify themselves to their constituents and excuse for doing things which they know they ought to do, but which they really don't have either the power or the survivability to do by themselves. Mayor Ed Koch is one of the most popular New York politicians since the war and an American turns his left wing. But he knows that real power lies in Wall Street which is why he's at a banker's lunch today. Even so, he believes the threat of bankruptcy was essential to the recovery of the city. Oh, I doubt that the city would have been turned around had we not suddenly confronted that we were spending money that we didn't have and then required to take the actions which were taken even before I became the Mayor in the years '75 through '78. They would have been very difficult if not impossible to do hadn't the situation arisen where people suddenly were confronted with the fact that if we didn't take those actions, the city couldn't survive the imminence of bankruptcy in '75 and will never go bankrupt, and we are fiscally one of the strongest cities in the country today. The imminence of bankruptcy in '75 definitely made it possible for the then political leaders and I as the inheritor of that situation to do more than would otherwise have been possible. If London was cut free from the apron strings and the control of central government, almost left to raise its money on the open market by these bonds, loans, etcetera. Do you think it would have a greater chance of solving its problems, because economic reality would be forced on it? Well, I don't know if you would solve your problems. You would certainly have to face the reality of your situation and I don't think you can begin to solve your problems until you really look at reality, and the reality of your situation would compel you to make some choices as to who pays for what. I mean, take our transit system, we always have the varying choices of keeping fares low, but at whose expense? Do we tax the automobile person? Do we tax the property owner? What is the proper relationship between the user and the taxpayer in general? I think you would certainly have some interesting discussions when you got all the parties to the play into one room which is always the beginning to solving a problem and had to face the determination as to whether you saw tomorrow rise or whether you went bankrupt. The threat of bankruptcy could actually be a very healthy development for time [Inaudible]. It's a very sobering kind of existence.