FACING BANKRUPTCY

Rotorua Morning Post, Volume 1, Issue 118, 11 January 1932, Page 5

FACING BANKRUPTCY

(Press. Assi).-

«•) --ig 'if '■■■■ t \ •/' > ^ | AMERICAN GITiES ALLEGED CORRUBTlON; AND EXTRAVAGANCE CAUSE TROUBLE i — -;,T . BANKS RELUGTANT TO HELP

-By TelegrapK — Copyright) .

Rec, Jan. 10, 11.35 p.m,, , NEW YORKj Saturday. With the revelation that. NeW York is in- grave .financial difficulties, ,an appeal has been made hy the Mayor Mr. Walker, to the Fedetal Government, alleging that the banks are squeezing municipalities that need loans totalling 90,000,000 dollars to meet Urgent obligations. Four of America's largest cities are facihg acute budgetry crises, with actual or technical bankruptcy in the offing. Chicago, Detroit, Philadelphia and NeW York are thoSe princip,ally affected. The banks here, contending that allegations point to extravagant expenditurd and corruption, are making it impossible to float in the city a loan at interest iii excess of six per cent. Short dated loans and unemployment relief are New York's most pressing requirements. It is uncertain Whether these can be met. Philadelphia with a 14,000, 000 dollar debit, the banks declining to under" write 15,000,000 dollar loan, was compelled to make its last fortnightly payment to 25,639 employees with scrip. Tax receipts have fallen and there are no prospects of obtaining sufficient revenue to meet expenditure. Detroit, requiring 44,000,000 dollars, cannot get the State authorities to approve of any bond issue in excess of 22,000,000 dollars. Meanwhile, it has extravagantly overspent on various unemployment relief measures and is needing 53,000,000 dollars to refund short-time loans. The city cannot put its financial house in order.