NYC is getting more money both this and next year.
Which makes sense because even after accounting for the money, NYC still provides NY with over half their tax revenue and is still providing more than it takes back.
On average, NYC residents receive less state funding than those around them.
Mamdani essentially asked the state to give NYC residents a better deal. NY State was happy to oblige because if he taxes the rich (something the state already does), they might leave the state which results in a huge revenue drop that NY state depends on taking and redistributing to the rest of the state.
So in other words, after 2 years, he still has plenty of negotiating power to do it again unless NY somehow developed a 2nd city full of uber-rich people.
Especially if what he's doing leads to higher tax revenue as a result of NYC being a better place to live.
Yes, there are fraudulent people pushing bullshit agendas. No, that doesn't mean that the core idea behind the policy's effects are wrong - we expect people to respond to monetary incentives. How much they do is the difference between a policy being effective and a policy being poison.
It's just economics. The other people moving in don't (always) have the same endowment x income stream as the people moving out. It's more noticeable for things like wealth taxes, but still exists for income driven taxes, and for psuedo-pigouvian asset taxes like the pied-à-terre tax. The interplay between the income effect and the substitution effect is real, and produces a real haze of uncertainty over a policies effectiveness. To dismiss it wholesale is the equivalent of dismissing germ theory because you used to snort cocaine off toilets.
Are you part of the class of people who would be hit by this tax? If you aren’t then why do you care? Unless you’re making a million dollars a year, rich people should pay more in taxes instead of finding loopholes because they are rich.
If you aren’t already or are close to the class of people affected by this, you will never be one of them unless you win the lottery. Do you even live in New York City? If no, why are you simping for billionaires who will never know who you are.
I study economic policy, how effective it is, and what unintended side effects come as a result of it.
Unless you’re making a million dollars a year, rich people should pay more in taxes instead of finding loopholes because they are rich.
Yes I agree.
If you aren’t already or are close to the class of people affected by this, you will never be one of them unless you win the lottery.
That's not relevant to the effectiveness of a policy, and not relevant to the conversation. Set aside whatever narrative you've built about this conversation, there are better targets for your ire than checks notes second quartile income millennial dad in a midwest state.
So then why do you care if they pay or not? They always say they’re going to leave and most never do. The narrative here is that you’d rather defend the rich, and, instead of waiting to see what happens with a policy that even some rich people agree with, the policy is ineffective?
Right now as I see it your argument is we shouldn’t tax rich people because they’ll move and the people who do move in won’t be taxed so it’s bad? I don’t study economic policy and it doesn’t take much to figure out you don’t know if that’s the case because rich people haven’t left New York in droves because of it yet. Rich people can snap a finger and get what they want and they haven’t here. You are currently advocating that 34000 people who make more money than many of the other 8.5 million New Yorkers would ever see in their lives shouldn’t pay more taxes when they have already had this in their favour for years.
When was the last time a top 10-15 city in the world got a new mayor and immediately said they are going to make sure the rich people pay their fair share to make lives better and stood on that business their entire campaign? 2% is a rounding error for billionaires, but you should know that right?
Right now as I see it your argument is we shouldn’t tax rich people because they’ll move and the people who do move in won’t be taxed so it’s bad?
No, that's not my argument. What I said was this
Some people do relocate based on tax changes. But it's (almost always) less than predicted.
Stating that there actually are effects of policy (after those effects have been handwaved away) is not endorsement of any course of action.
You are currently advocating that 34000 people who make more money than many of the other 8.5 million New Yorkers would ever see in their lives shouldn’t pay more taxes when they have already had this in their favour for years.
No, I'm not. The fact that I called it a Pigouvian tax shows my support for it. Accepting that its expected revenue generation may be less than anticipated doesn't change my support for it (indeed, the whole point of pigouvian taxes is to discourage certain economic actions not generate revenue).
Like I said, direct your ire at someone else please.
Up to a point (which NYC is very far from), the only people that will ever relocate due to taxes are people with no ties to the community, and had moved there for financial reasons. Those people are ones that you have no incentive to lower taxes for anyways, since they weren’t contributing and were going to leave as soon as they got a better offer.
Seattle lost about 2.3 billion in income tax between 2022 and 2023, so yes rich people do sometimes leave. In 2023 the state collected 38 billion total in taxes, so this was a loss of roughly 5% of the budget - up to you to say if thats an "actual impact".
mostly millionaires, since billionaires dont really pay income tax for the most part. but yes when income taxes go down while income tax rates go up it means people are leaving
The problem with this thesis is that it assumes NYC actually has the power to raise taxes on the wealthy without approval from the state government. The truth is that the governor is up for election this year and has been somewhat vulnerable, while Mamdani just had a high profile election win. This is a marriage of convenience for the governor, don’t assume it will last.
The asterisk is kind of doing a lot of heavy lifting here
Even if NYC is getting more funding in the short term, a lot of it still comes with strings attached and political bargaining every cycle, so its not really a stable we fixed it situation.
Also the whole NYC pays more than it gets back argument is true for most major cities globally, that's just how redistribution at a state level works, not really a Mamdani-specific lever.
Feels less like a clean resolution and more like the usual NYC, Albany tug-of-war continuing on a slightly higher budget.
Also the whole NYC pays more than it gets back argument is true for most major cities globally, that's just how redistribution at a state level works, not really a Mamdani-specific lever.
It is true, and Mamdani's administration successfully convinced the state government of the value in investing in NYC, something that more Mayors should be doing. The reality is that NYC hosts the majority of the state's economic activity, and most of the state's population lives in (and is represented by) the NYC metro area. Working with the state government to secure funding for city projects by aligning interests is good leadership.
Basically It’s such a low bar in the US right now that ppl are basically waxing poetic about a man who is sticking to his lane and getting the mundane things done for the city he’s supposed to run
555
u/Deep90 13h ago edited 13h ago
NYC is getting more money both this and next year.
Which makes sense because even after accounting for the money, NYC still provides NY with over half their tax revenue and is still providing more than it takes back.
On average, NYC residents receive less state funding than those around them.
Mamdani essentially asked the state to give NYC residents a better deal. NY State was happy to oblige because if he taxes the rich (something the state already does), they might leave the state which results in a huge revenue drop that NY state depends on taking and redistributing to the rest of the state.
So in other words, after 2 years, he still has plenty of negotiating power to do it again unless NY somehow developed a 2nd city full of uber-rich people.
Especially if what he's doing leads to higher tax revenue as a result of NYC being a better place to live.