Rich to NYC: Drop dead

Wealthy New Yorkers complain about potential tax hikes while the city reaches a fiscal cliff.
Wealthy New Yorkers complain about potential tax hikes while the city reaches a fiscal cliff.
Wealthy New Yorkers complain about potential tax hikes while the city reaches a fiscal cliff.

Rich to NYC: Drop dead

While the city approaches a fiscal cliff, the most powerful New Yorkers complain about possible tax hikes.
September 14, 2020

A second wave of coronavirus infections could come in the fall, just as New York City approaches a fiscal cliff – and one group of concerned citizens is not doing much to help.

The city needs money in the upcoming weeks – about $5 billion – in order to avoid 22,000 layoffs and significant reductions in municipal services. New bonding authority from the state, additional federal aid or higher taxes on the wealthy could plug this budget hole.

Yet, the people with the most political influence and personal wealth are looking out for themselves – rather than the city where they made their millions.

The uber-wealthy are holding out on paying more in taxes – and threatening to leave the state if the state Legislature goes through with proposals to increase taxes on luxuries such as second homes and stock transfers. Well-off NIMBYs ran the homeless out of a makeshift shelter on the Upper West Side intended to temporarily alleviate crowded conditions in homeless shelters during the pandemic. Rich Manhattanites are even less likely this year – breaking with historical norms – to fill out the census, which could cost the city a congressional representative and billions in federal funding in years to come.

A recent letter to Mayor Bill de Blasio signed by 163 of the richest people in the city – formally identified as “business leaders” – highlights the priorities of the 1%, as their city’s future hangs in the balance. “There is widespread anxiety over public safety, cleanliness and other quality of life issues that are contributing to deteriorating conditions in commercial districts and neighborhoods across the five boroughs,” reads the letter sent by the Partnership for New York City, a leading business group. “People will be slow to return unless their concerns about security and the livability of our communities are addressed quickly and with respect and fairness for our city’s diverse populations.”

Their perception of “deteriorating conditions,” might have come from conservative misinformation sources such as Fox News and the New York Post, rather than reality. For one thing, many of them have hardly been in New York City lately. As The New York Times reported, Partnership for NYC president Kathryn Wylde “said she waited to publish (the letter) until after Labor Day, in part because of concern among some members, who had spent the pandemic outside the city, that they would be criticized for weighing in on New York’s future from afar. ‘They felt it was unseemly to be writing from the Hamptons,’ she said.”

While well-heeled parts of Manhattan might feel like a ghost town, the outer boroughs are alive and well. Even the overstated flight of city residents to suburbia and resulting backup of housing inventory is isolated to Manhattan, while Brooklyn’s and Queens’ housing markets flourish, according to a data analysis in today’s New York Times. 

That all sounds great. The city could use a boost in homeless services. Unemployed people and small businesses do need relief. While the city remains one of the safest big cities in the country, and safer than it was during the 1990s, crime has ticked upwards in recent months from record lows. A 67-page report released in July by business leaders lists some constructive suggestions for addressing these issues long term, including increasing child care, expanding job training programs and boosting internet access for lower income people. While the report suggests that tax increases could be necessary, it specifically opposes income tax hikes on the top 1% of New Yorkers. 

The problem is that these suggestions cost money and the city might only have a few weeks left before it falls off a fiscal cliff that could hamper the city economy for years to come. So maybe instead of signing a letter hyping the city’s problems the 1% could do their part in solving them.

They could start by filling out the census before the impending deadline and pushing all their friends on the Upper East Side to do the same. They could lean on Gov. Andrew Cuomo to work something out with the mayor and state lawmakers to get the city the borrowing authority and additional tax revenue that would help it get through one of its worst crises in its 400-year history. 

Some could even do what they arguably do best: call in favors from other powerful white men. Grocery story magnate John Catsimatisis could spend less time helping alleged sexual predator former Fox News host Bill O’Reilly resurrect his career and more time leaning on his longtime buddy President Donald Trump to see about jump starting stalled negotiations on a new round of federal stimulus funding. Presidential son-in-law Jared Kushner certainly has a really good reason to pick up the phone whenever real estate kingpin Ric Clark of Brookfield Asset Management, who bailed the Kushners out of a troubled Midtown tower, comes calling. Longtime Cuomo donor Scott Rechler could tell Cuomo that the richest of the richest – who make up a big chunk of state income tax revenues – are willing to pay more taxes after all to save the city before the fiscal effects of the pandemic begin to really take hold in the five boroughs.

The rich could think of this all as an investment that could benefit them in ways both material and abstract. Saving New York City from fiscal ruin would likely help prevent crime from getting worse and improve the quality of life for all New Yorkers. If they are willing to part with a bit of time and money they could even show the people hit hardest by the pandemic that rich white men can be as much a part of the solution as the cause of the racial and economic inequalities that have hit people of color particularly hard during the pandemic. 

A new letter from the Partnership for New York City to Trump urging him to back additional stimulus money for New York City subways is a start. But public figures like Catsimatidis are not known for staying quiet. They could speak up more in the coming weeks, because if the richest New Yorkers contribute even a small fraction of their fortunes to their city it could lessen the damage still to be done by the coronavirus to public needs such as health and education. It remains to be seen whether the rich will offer an outstretched hand once everyone else starts tumbling over the edge.

Zach Williams
is senior state politics reporter at City & State.