NEW York City's current budgetary decisions will determine whether the city holds on to its 1990s quality-of-life gains or whether it descends back into the squalor and chaos of a mere 15 years ago.

Preserving public safety must be the No. 1 principle guiding all spending decisions. Nothing played as large a role in the city's triumphant rebirth in the last decade as the 70 percent drop in crime; nothing, therefore, must be allowed to compromise the police department's ability to protect the public. Conditions that create the perception of lawlessness, such as litter in the subway system or graffiti, must also not be allowed to escalate. Mayor Bloomberg's decision to cut 1,000 officers from the police force by canceling a class of recruits is a step in the wrong direction.

The city also needs to get out of the welfare business and concentrate on the core function of urban government: providing the public infrastructure that allows individuals to seize opportunity. Over the decades, New York has created a host of welfare programs that are unique in the nation, the product of litigation by well-organized poverty advocates. Those programs transfer onto government responsibilities that in the rest of the country are borne by family and civil society. For a select number of putative victim groups, City Hall acts as father, extended kin or friend, at an astronomical cost to the taxpayers. All too often, these welfare arrangements subsidize irresponsible behavior, thus ensuring more of it and larger taxpayer burdens long into the future.

A prime example of counterproductive largess is the city's housing subsidies for unmarried mothers. Reducing them would free up money that could be used to protect public safety or reduce taxes. This year, New York will spend a mind-boggling $433 million to provide free housing for families claiming homelessness, virtually all headed by single mothers. That's on top of the nearly $200 million the city spends on "homelessness prevention"- cash grants and lawyers' fees for fighting eviction suits. No other US city offers this entitlement.

To put that $433 million in perspective, it's nearly a third of the $1.5 billion in spending cuts that Bloomberg proposed last week and almost twice as much as the cost of the $400 dollar property-tax rebate that the mayor wants to eliminate. That property-tax rebate - costing $256 million annually - helps hundreds of thousands of hard-working New Yorkers. The $433 million for the "homeless" family-housing program goes to a mere 8,800 families, or .34 percent of the city population. On average, those 8,800 families cost taxpayers $31,000 annually per family. Yet the mayor says that the city can't afford a $400 property-tax rebate for working households.

Are these alleged homeless families really homeless? Here's a test. After a hurricane or other natural disaster wipes out people's homes, the Red Cross opens emergency shelters for the newly homeless - dormitory-like facilities that people who otherwise would have no roof over their head gratefully accept before they move on to the assistance of family and friends. Such group accommodations aren't what the city means by "homeless-family housing," however. Homeless-family housing in New York consists of a free private apartment with kitchen and bath, in which the average single mother stays nearly a year.

If single mothers claiming homelessness were offered Red Cross-type group accommodations, rather than their own apartment, the number of families trying to enter the system would drop precipitously, as would the length of stay. Many young women claiming homelessness have alternatives to free city housing, such as continuing to live with their own single mothers or moving in with friends. Those alternative accommodations are undoubtedly crowded and less than ideal. But a less-than-ideal housing arrangement isn't the same thing as no housing at all.

Traditionally, the stigma attached to illegitimacy and the need to rely on a disapproving family for support discouraged women from having out-of-wedlock children. Take away the stigma - as the welfare-rights revolution did - and provide housing and a monthly check clear of any unpleasant family negotiations, and you will see illegitimacy skyrocket. The city has socialized the costs of irresponsible behavior, thus encouraging more of it.

In the current economic crisis, the city can't afford a nearly half-billion dollar subsidy to a small fraction of its population. Bloomberg is proposing to reduce library hours to save a mere $11 million. Yet many more children use the city's libraries than receive the half-billion-dollar housing subsidy for allegedly homeless families. City officials must set a higher standard regarding the lack of alternative housing before setting up families in their free apartments; they must also shorten the average stay in that housing. Single-parent families in other cities somehow manage to survive without a right to free shelter. New York can no longer afford to be the nation's welfare capital.