From my personal experience, life in NYC changed a lot especially during the 80's. Beginning of that decade, yep, terrible. The city was in obvious decay, and you could see that even in Manhattan. It was really omnipresent. Grime and crime. You had to be careful driving because of all those humongous potholes (seriously, that was incredible! You even had to be careful to _walk_! Hitting one of those either by car or on foot, you'd really end up hurt). You could see all those steam clouds emitted from broken underground pipes. Made for pretty pics and background of some Hollywood flicks. You walked along 42nd St, you'd end up being offered any kind of drugs at least a couple times - and I mean in broad daylight, walking as far as possible in the street, not close to the entrances. There was the electronics heaven, lots of little stores selling cameras, walkmen, all those Japanese gadgets. I believe it was on or around 38th St. Some of those stores had been robbed so often, you had ring to be let in through massive metal fences. Taking the subway at night? You simply wouldn't want to do that. Oh, that reminds me, you always carried some mug money - guess I haven't done that anywhere in the world anymore since at least a decade.
But during the second half of the 80's, Ed Koch did manage to improve the situation. I don't care about the political discussion that has already started here, but there was certainly some progress to be seen already.
It has been many, many years since I read it, but I recall Tom Wolfe's novel 'Bonfire of the Vanities' really catching the situation in NYC at the beginning of the 80's pretty well. Not the film, though. Read the book, if you want to get additional insight.
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