Local college professors, encyclopedias, and even newscasts of the day blame default primarily on the battle of wills between then-Mayor Dennis Kucinich; and Cleveland's business community.
The fight stemmed from the mayor's refusal to sell what's now Cleveland Public Power.... to Cleveland Electric Illuminating; the energy supplier partly owned at the time by some local banks.
Angry bankers then called due $15 millions in bonds owed by the city, as a power play to `force' the mayor to sell.
But there were other factors which caused default. Cleveland was hemorraging population and businesses in 1978, which cut deeply into the city's tax revenue.
Even so....the City Council refused tax rate increases and continued to increase municipal spending.
Approaching financial gridlock, business leaders and the combative mayor still weren't able to find a solution.
The payment deadline arrived during a midnight showdown at city council chambers. Independendent journalist Roldo Bartimole was sitting right up front.
BARTIMOLE: "The final night was a very dramatic night and I certainly had fears that because of the tensions being so high that somebody might try to shoot either George Forbes or Dennis Kucinich, and they were both there."
It never went that far, but residents suffered greatly following default, as 875 police and 400 firefighters were laid off just days later, and Cleveland had damaged its reputation with creditors for many years.
It took the first two years and a new mayor... George Voinovich... to get the city and local banks `back' on the same page.
BARTMOLE: "I think it was a blemish and I think over the years, Dennis has used it as a badge of honor. And I think both sides don't tell the true story of what happened. They were both too stubborn for theor own good."
Cleveland remained in default, until 1987.
Rick Jackson, 90.3
