This chapter's central argument is that several major macro social forces (e.g., economic decline, job loss, housing abandonment, homelessness) have disproportionately influenced the inner-city economy. These forces have resulted in micro consequences for many households, families and individuals residing in the inner city. Economic marginality has generated high levels of alcohol and other drug abuse as well as criminality. The article includes an extensive family history which demonstrates the continuing influences of these macro forces and their micro consequences. In addition, the article focuses on the continued socioeconomic decline in the inner city during the period 1960-1992, particularly in New York City. New York City is a primary focus because its inner-city residents account for a disproportionate share of the Nation's problem and the city has had the Nation's largest drug abuse problem. The article claims that the use, abuse, and sale or distribution of illegal drugs is both a consequence of the rising social distress in the inner city and an important contributor to the continuity and intensity of inner-city conditions and the difficulty of alleviating them. Figure, notes, references