Mamdani’s Budget: Where’s He Going To Get the Money for His ‘Free’ Benefits?

The rubber is about to hit the road when it comes to Mayor Zohran Mamdani’s costly vision of more “free” government benefits. The mayor campaigned on a program of $10 billion in additional city spending, with only vague plans for how to pay for it — apart from soaking millionaires. Yet Governor Kathy Hochul, to her credit, is holding the line on tax hikes, while the city faces a $12 billion budget deficit. Could the Marxist mayor have to swallow spending cuts?So far, at least, the new mayor isn’t backing down from his agenda of higher taxes and spending. After Mrs. Hochul, in her budget for the state, failed to endorse raising taxes, Mr. Mamdani vowed to press on. “Our administration is preparing to make the case that it is the time for New York’s most profitable corporations and wealthiest residents to pay their fair share,” he averred.Mrs. Hochul, on this issue at least, has a more level-headed view. “I know he’s calling for a tax increase,” she says of Mr. Mamdani. “I’m sensitive to the impacts.” Mrs. Hochul, after all, has her re-election bid to consider. So state taxpayers are safe, it would seem, at least until November 3. Her leading GOP opponent, Nassau County’s executive, Bruce Blakeman, calls the governor too liberal and decries the fact that the state tax burden is the highest in America.Mr. Blakeman’s appraisal is borne out by the Tax Foundation, which rates New York dead last on its State Tax Competitiveness Index. The foundation points to the state’s “high rates and a burdensome and highly nonneutral tax structure.” The top income tax rate in the state is 10.9 percent and the city levies its own income tax, with a top rate of almost 4 percent. These levies are on top of income taxes paid to Uncle Sam. The state’s corporations are socked by an income tax, too, and the rates range between 6.5 percent and 7.25 percent. That tax on businesses is borne by the state’s consumers and residents in the form of either higher prices for goods and services, or fewer jobs. So raising the corporate tax rate is likely to inflict economic harm on all New Yorkers. While Mrs. Hochul hesitates on this head, Mr. Mamdani urges lawmakers to ratchet up the rates.The new mayor — who will need Albany’s okay for higher taxes — posits a “need for more revenue from the highest earners.” He points to “long-standing fiscal issues,” arguing that city taxpayers are actually subsidizing the rest of the state. Some 54.5 percent of state tax revenues come from the city, he contends, while, the New York Post reports the city gets back only 40.5 percent. He eyes a reset in “the relationship between City Hall and Albany.”What that would entail is unclear, but even Mr. Mamdani is conceding that the city is not “on firm financial footing.” He blames his predecessor, Eric Adams. That’s a nod to a looming gap in the city budget over the next two years. The city’s comptroller, Mark Levine, is sounding the alarm of a shortfall of $2.2 billion in the current fiscal year. Next year will be worse, he warns, with a deficit expected to the tune of $10.4 billion. Now that Mrs. Hochul has closed the door on tax increases, how does Mr. Mamdani plan to balance the budget — much less launch his envisioned $10 billion in new spending? Answers could await in the mayor’s budget, though the mayor’s press office did not immediately reply to our queries about how Hizzoner anticipated bridging the budgetary gap. It could prove a bitter pill for the new mayor, but it is hard to see how he can avoid the logic of austerity._______* Spondulix.

Mamdani’s Budget: Where’s He Going To Get the Money for His ‘Free’ Benefits?

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