New York City and Mayor Zohran Mamdani find themselves in deep economic water. The city is staring at a $12 billion budget hole that must be filled by June 30, a massive economic challenge for any mayor, let alone one on the job for just 22 days like Mamdani.
Without question, a deficit of this size will hinder Mamdani’s ability to realize much of the affordability agenda that propelled him to the highest office in New York City last year. Closing a massive deficit in New York requires a delicate budget dance that ensures a responsible, balanced budget without taking the meat ax to crucial public services that keep the city going and the people safe.
If he had it his way, Mamdani would institute a tax increase on the wealthiest New Yorkers, as he promised to do during his mayoral campaign in 2025. Anyone making more than a million dollars annually would be affected by such a tax increase; the mayor says a 2% increase in income would generate $4 billion in new city revenue. A similar increase in corporate taxes would raise another billion dollars for the city.
In any case, none of that combined $5 billion in revenue would be enough to close the $12 billion deficit, indicating that other measures to balance the budget must be considered.
There’s just one problem for the mayor, and one salvation for those who would otherwise feel the pinch of higher taxes: Tax increases are the responsibility of the state government. Neither the mayor nor the City Council has such authority.
Gov. Kathy Hochul, meanwhile, has said for months that she would oppose tax increases. Facing re-election herself this year, tax increases of any kind — even on the wealthiest New Yorkers — risk major political blowback. It would hand ammunition for her opponents to use to poke holes at her own affordability agenda.
But Hochul has shown Mamdani and the city a path forward through her executive budget, rolled out Tuesday. Her state budget is massive, $260 billion, but it is balanced; it makes up for federal cutbacks without compromising on major services. And most importantly, the spending plan does not include personal income tax increases.
Despite what Mamdani and those on the far left who shout “tax the rich” every chance they get believe, the fact is that tax increases on anyone, regardless of income or status, ought to be the very last resort for government. Those with the means to avoid tax increases will either find a loophole around them or pull their business out of New York entirely. If that happens, the average taxpayer will be left holding the budget deficit bag.
Any responsible executive must first pursue every possible avenue to balance the budget while retaining all necessary services without asking taxpayers to contribute more.
No one wants an “austerity budget,” as Mamdani said Tuesday, that cuts essential services to the bone. But no one wants to pay more, either. It’s his responsibility as the mayor to do everything he can in order to avoid such cuts, and only pursue a tax increase if every other path is not viable.
