So this past year, when headlines began shrieking bad news from Wall Street, one reality was reduced city tax revenues. That led to a roughly $4-illion deficit for the remainder of this fiscal year ending June 30. Now, some openly worry the emptier city purse could lead to the types of cuts that impact quality of life, including law enforcement. And, common sense dictates, if crime does increase, that alone would reduce New York's appeal, marketability and overall value, including its residential real estate.

"If you're going to cut services, you're probably going to have to cut the police department," Staniford says. "If that contributes to a situation like we had in the 1980s when crime was significant, all property values are going to come down."

However, a spokesperson for Mayor Michael Bloomberg says this administration's over-arching message has been that the mistakes of the 1970s will not be repeated. Most agree the blunders began in 1975, after a world recession and a period of soaring unemployment.

New York City, facing a $150-million budget gap, cut vital city services, including an eventual 20% reduction in the police force. The force had numbered 31,000 in 1972 but shrank to 22,000 by 1980. Crime skyrocketed and as a result, the city's reputation suffered.

"That nearly destroyed the city," says Mark Lavorgna, a spokesperson for Bloomberg. "We are not going to stop policing and cleaning the streets, or making government investments that allow the city to be the city. The mayor's greatest concern is not repeating the mistakes from the past, allowing a financial crisis to be a catalyst for the city's quality of life dropping."

Lavorgna stresses that the city is not cutting the police department at this time. Instead, he says, the department will defer hiring a police class of 1,000 officers back to the next class by about six months later.<p?In addition, in an effort to spread some of the pain, the city has restored the temporary 7% reduction in property taxes, which raises $576 million for fiscal year 2009. The Bloomberg administration is instructing that the entire city must share the cost in what may be the beginning of another challenging chapter in its history.

"The mayor has said we are going to have some pain and these are not things we want to do," Lavorgna says. "We carried forward a lot of dollars from surplus years to prepay debt and make sure we were in a better situation, but that was for a rainy day and not for the tsunami that's hit."