Giuliani-era New York City

The history of New York City (1978–present) has seen a cycle of modest boom and a bust in the 1980s, a major boom in the 1990s, and mixed prospects since then. This period has seen severe racial tension, a dramatic spike and fall of crime rates, and a major influx of immigrants growing the city's population past the eight million mark. The September 11 attacks on the World Trade Center in 2001 had a lasting impact on the city that continues to reverberate to the present.

Compared to the 1970s, the 1980s were a time of restrained optimism in New York. The boom on Wall Street was fueling the speculative real estate market, and unemployment numbers dropped noticeably, however, the city's reputation for crime and disorder was still very much a part of New Yorkers' daily lives. Mayor Ed Koch repeatedly warned that filth, crime, and racial tensions were weakening the city. He put a high priority on rebuilding neighborhoods and infrastructure. One result was that gentrification brought new businesses to decrepit neighborhoods corners and converted low-end rental housing to co-ops and condos that attracted young upscale professionals and business people. Koch's energetic efforts brought enormous attention from the media, but critics condemned his attacks on his opponents as "crazy," "wackos," and "radicals" and alleged he was racially divisive.

For years enormous attention followed the criminal trials resulted when a woman known as the Central Park Jogger was badly beaten and raped. The illegal drug trade flourished, causing the murder rate to soar, and dividing the city into areas ruled by different drug lords. It became known as the crack epidemic. The New York City Subway fell victim to a crime epidemic that saw more crimes being committed on the subway each year than in any other subway system around the world.

Homelessness became a serious problem during the 1980s, specifically in the last two of Edward Koch's three terms as mayor (1978–1990). The city outlawed discrimination against gay and lesbian people in such matters as employment and housing in 1986. In 1989, Koch was defeated by David Dinkins in the Democratic Party primary in his bid for a fourth term, and then Dinkins narrowly defeated Republican Rudolph Giuliani in the general election to become the city's first-ever black mayor. Crime began a 15-year decline in 1990 during Dinkins's administration, but a combination of continued racial strife (such as that in the Crown Heights Riot in 1991), and an extremely weak economy (in January 1993 the city's unemployment rate reached 13.4 percent, the highest level of joblessness seen there since the Great Depression) caused Dinkins' popularity to seriously decline (including a threat by residents of Staten Island to secede from the city, where in a 1993 referendum, 65% voted to secede, but implementation was blocked in the State Assembly).

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