The core argument is that despite pledges to make New York affordable, the city’s budget has become unaffordable, reaching a staggering $127 billion in 2024, comparable to the annual expenditures of mid-sized countries like Greece or Thailand.
– New York City’s budget nearly doubled from $70 billion in 2014 to $127 billion in 2024. This growth outpaced both inflation and economic growth.
– During the same period, the city’s population fell by about 5% from 2020 to mid-2022, reducing the tax base that funds these expenses. Despite some rebound, the population remains below pre-pandemic levels, intensifying per capita costs.
– New York’s spending per capita in 2023 was over 30% higher than Los Angeles and more than double Houston’s, based on Lincoln Institute data. Yet, the outcomes, especially in education, are mediocre.
– For comparison, the Department of Education’s budget rose from approximately $34 billion in 2019 to over $40 billion, even as enrollment shrank. Per-pupil spending is projected to reach nearly $35,000 in 2026, among the highest nationally. Despite high spending, graduation rates, test scores, and reading levels remain average or below expectations.
– New York residents face some of the highest tax rates in the U.S., with combined state and city income taxes reaching 14.7%. Marginal tax rates can exceed 50%, and investment income may be taxed up to roughly 55%. Mamdani proposes further tax hikes on income and corporate rates or alternatively a nearly 10% increase in property taxes, which already constitute over 27% of homeownership costs, above the national average.
– Fareed criticizes the continual expansion of government programs as a driver of unaffordability. It argues that subsidies, particularly for housing, have unintentionally driven up rents. Rental assistance spending increased fivefold from $263 million in 2020 to $1.34 billion recently, yet housing costs worsened.
– Emphasis should shift from subsidies to building abundant market-rate housing, which would increase the population, broaden the tax base, improve school enrollment, and bolster local GDP. The goal should be practical governance focused on safer streets, functioning schools, reliable sanitation, and sufficient housing for the middle class, rather than expanding entitlements.
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The core argument is that despite pledges to make New York affordable, the city’s budget has become unaffordable, reaching a staggering $127 billion in 2024, comparable to the annual expenditures of mid-sized countries like Greece or Thailand.
– New York City’s budget nearly doubled from $70 billion in 2014 to $127 billion in 2024. This growth outpaced both inflation and economic growth.
– During the same period, the city’s population fell by about 5% from 2020 to mid-2022, reducing the tax base that funds these expenses. Despite some rebound, the population remains below pre-pandemic levels, intensifying per capita costs.
– New York’s spending per capita in 2023 was over 30% higher than Los Angeles and more than double Houston’s, based on Lincoln Institute data. Yet, the outcomes, especially in education, are mediocre.
– For comparison, the Department of Education’s budget rose from approximately $34 billion in 2019 to over $40 billion, even as enrollment shrank. Per-pupil spending is projected to reach nearly $35,000 in 2026, among the highest nationally. Despite high spending, graduation rates, test scores, and reading levels remain average or below expectations.
– New York residents face some of the highest tax rates in the U.S., with combined state and city income taxes reaching 14.7%. Marginal tax rates can exceed 50%, and investment income may be taxed up to roughly 55%. Mamdani proposes further tax hikes on income and corporate rates or alternatively a nearly 10% increase in property taxes, which already constitute over 27% of homeownership costs, above the national average.
– Fareed criticizes the continual expansion of government programs as a driver of unaffordability. It argues that subsidies, particularly for housing, have unintentionally driven up rents. Rental assistance spending increased fivefold from $263 million in 2020 to $1.34 billion recently, yet housing costs worsened.
– Emphasis should shift from subsidies to building abundant market-rate housing, which would increase the population, broaden the tax base, improve school enrollment, and bolster local GDP. The goal should be practical governance focused on safer streets, functioning schools, reliable sanitation, and sufficient housing for the middle class, rather than expanding entitlements.