Mamdani heading towards raising property taxes

>> So it is reasonable to complain about increasing entitlement costs

Sure, complain away. But complainers could start with a semblance of sense on who’s paying for whom, where the inefficiencies lie, etc. Or not. Just vibe-complain based on whatever is frustrating you. It’s the American way.

Medical costs are higher because 1) doctors make too much money (for example in Europe doctors are not struggling but are not super high earners either) 2) the multi-payer system is so complex, we have too many people in administration to make it work.
Sure, drug prices are really high as we subsidize R&D for the entire world's benefit, but drugs are only a small fraction of overall healthcare costs, so don't affect the total as much as costs of services.

Some of the medicaid fraud is related to too many people on the program who don't qualify. A crazy number of people in NYC have "cash" jobs plus illegally collect govt benefits. Even agencies struggle finding candidates willing to work for a w-2. I've had success with college students on parent's insurance. Seems like inonada had success with someone who has insurance through husband. But these are exceptions as 99% of nannies in the city are on medicaid and work for cash which they don't report, and they earn significantly above medicaid cutoff, sometimes 6 figures.

So based on math above, my partner and I are supporting a few random poor people via taxes, plus our child (who is not in school yet, so all of the costs are on us, parents).

We submitted our DOE 3K application by the Friday deadline and I just found out our awful lottery number... it starts with an F and is 96.5th percentile number (so in the 3.5% percent of the worst possible numbers). Last year few people I spoke with in our district (District 2) who had 70th percentile numbers did not get in anywhere within the district. They got an offer in the Bronx (so DOE could claim that everyone got an offer).

We are paying so much into the system and looks like won't be able to get for our son even something that gov't claims is "universal" and available to all.

Fraud and inefficiency are two separate things. I was just pointing out that structural inefficiency in the US, relative to other countries, is what drives up the per-capita costs. The fraud you describe is, somewhat perversely, making it more efficient assuming the 65+ Medicare efficiency situation equally applies to Medicaid!

Another piece of amusement to note here. The people who employ cash nannies & housekeepers & whatnot are implicit accomplices in situation. They are not paying their share of the payroll taxes funding SS and Medicare / Medicaid for their employee, to say nothing of paying a lesser amount because it’s cash, nor providing healthcare coverage, etc. So it’s poetic justice that they collectively have to foot the bill anyways through their own higher taxes. The 99% of them, according to you, anyway.

I say this as an above-the-table payer who nevertheless pays for the Medicaid of a whole lot of random strangers. Not to mention the Obama-care subsidies of random strangers (~$500/mo per person on average according to Google), most amusingly those going to millionaire FIRE types scheming how to game ACA income thresholds for the next 25 years or whatever until Medicare kicks in.

If you employ cash workers and/or are a wealthy beneficiary of ACA subsidies, how broken is all that?

I don’t have much of a horse in this race, but if there are 19 countries all doing X to deliver equal healthcare at half the cost as 1 country doing Y…. Uh, maybe you should do X too?

It’s somewhere between entertaining and embarrassing that the country is wasting 7.5% of GDP on the obviously inefficient system Y because of bickering of various sorts, including considering of X a nonstarter.

>> We are paying so much into the system and looks like won't be able to get for our son even something that gov't claims is "universal" and available to all

Meh, you’re taking care of all those random strangers, right? What’s a few more nickels for your actual loved ones?

It’s not nickels, it is at least 40k of aftertax money a year just for the school day (but to cover my working hours need a nanny on top of that), and the promise was, we get the kid to 3K and then gov’t will help afterwards. Now I am looking up the stories from last year with a similar lottery number, and people did jot get in anywhere in the same borough! And I live next to a 3K center.

Some of these nannies make 150k cash (if watching multiple kids, working overtime, etc) and pay no taxes while collecting benefits. The real losers are people like me actually paying via w-2. From what I see enforcement of any rules is extremely limited.

In support of the point that boomers are squeezing younger people, here is a video that talks about relative spending. This is similar to manhattan rapidly graying fact I brought up earlier. So who has all the money? https://youtu.be/YJGR7p5gLDA?si=GKHp01KzYkMQRaHT

Old people have all the money. Always been, always will be. Wealth is wasted on the old, and youth is wasted on the young.

On the topic of how tough the highly upwardly mobile young Manhattanite has it these days, I think of the prototypical Big Law worker in their early 30’s who has saved just enough for their first apartment—where they’re going to sink essentially their entire net worth to get a toehold on a home that’ll be right-sized the next 10 or 20 years. Compared to 20 years ago, their income has doubled. But Manhattan RE is only up 16%. Is it all really that bad, is this the worst it’s ever been?

SS payments estimated to be reduced by 7% in 2032 followed by a further 28% reduction the following year.

Our economy is premised on the idea that the next generation will have more wealth (and, thereby, more tax and related revenues) than the prior generation, and disproportionately more so than the population growth, which funds the direct and indirect debts of the current generations. That model may well be broken with successive generations that do not have a fascination with wealth generation, and folks should brace for the idea that medicare and social security will be not be there when it is needed.

I feel like I'm missing something. For increased revenue, don't we need more immigrants? Regulated, prefereably, not the illegal variety.

Immigrants making more than $100-150k for enough number of years so that they can contribute enough to the tax base.

OK but they still contribute through payroll taxes (FICA), sales and excise taxes (consumption), state and local taxes (if they earn enough), property taxes (directly if they own, indirectly if they rent), business-related tax contributions if they work for a company or start their own. And their labor drives GDP and demand.

>>>Old people have all the money. Always been, always will be. Wealth is wasted on the old, and youth is wasted on the young.

That is actually not true. Majority of old people historically were very poor, mostly too poor to even afford retirement. Obviously, this has changed with the introduction of entitlements and pensions. Historically, working people that were the ones that were driving spending. The video I linked above shows that this trend flipped and consumption is now driven by retirees who are becoming the prime target for marketers.

Young people are now crushed by 1) out of control student loans 2) out of control housing costs 3) high childcare costs 4) it is really hard to get an entry level job right now

This has been a trend for a while:
https://business.time.com/2011/11/09/talk-about-old-money-old-folks-got-richer-young-people-much-poorer-over-the-years/

>>>Compared to 20 years ago, their income has doubled. But Manhattan RE is only up 16%. Is it all really that bad, is this the worst it’s ever been?

1) Big Law compensation famously increased more than other professions since then (there was a WSJ article comparing to bankers for example)
2) Brooklyn was a much cheaper option then, and people not working in Big Law (or working in Big Law), could opt for that. Now everything is overpriced
3) Property taxes and maintenance costs have increased a lot faster than incomes or inflation since them; student loans increased; childcare costs increased
4) Funny to be making a comparison to near peak housing bubble

>>> So it’s poetic justice that they collectively have to foot the bill anyways through their own higher taxes. The 99% of them, according to you, anyway.

The injustice is that I also foot this bill even though I am paying payroll taxes, etc

>> The video I linked above shows that this trend flipped and consumption is now driven by retirees who are becoming the prime target for marketers.

The video you linked was some guy blathering for 30 minutes. There was a single chart shown 5 minutes in, and he failed to even recognize demographic changes as a potential factor.

It’s not that I don’t believe this could be a thing. It’s just that you have not actually provided relevant stats from credible sources. You said the same thing about wealth, and my cursory look at data aseembled by the Fed’s countless economists showed that per-capita wealth, as a fraction of GDP per capita, has remained unchanged across 2 generations. You then made a claim about the value of entitlements, which a cursory look at SS payments as a fraction of GDP per capita debunks (not to mention what even a cursory understanding of COLA adjustments would imply.)

Then this from a journalist who lacks basic economic sense:

>> Using government data, the study notes that the median net worth for individuals ages 65 and up stood at $170,494 in 2009, compared to $120,457 in 1984 (all figures are in 2010 dollars to account for inflation).

So a 42% increase when GDP grew 56%? That’s (slightly) behind on the relevant metric, not a sign of abnormal increase.

>> Funny to be making a comparison to near peak housing bubble

My point was that there is always something in the economy that one can point at to say “This is so unfair!” So yeah, I kinda needed to pick a particularly extreme point where the item was occupying a top spot in the public narrative.

In my experience, spending all your mental energy on such things not only makes you crabby, but it also makes you miss the opportunities hiding in plain sight because you’ve let X suck up all the oxygen in the room.

Just my opinion, might not match your experience.

>>>The Spending Gap: The U.S. spends roughly 2.0 times more per capita on adults 65+ than the average of other high-income countries ($24,665 vs. $12,309). In contrast, the gap for working-age adults (20–64) is wider, with the U.S. spending 2.3 times more than peer nations.

Do the working age adults consume more or pay more? Because I saw a lot of studies saying private insurance pays 2x to 2.5x for the exact same thing than Medicare. Hospitals and doctors overcharge private insurance to subsidize Medicaid and Medicare patients.

I think when looking at conventional measurements in dollars, one needs to be careful not to always equate dollars with value or fair entitlement.

Doctors doing the same thing are compensated very differently here and in Europe. Same value to society, different outcome for their bank accounts. New York teachers that were hired few decades ago got much sweeter pension deal than the teachers from current generation who need to contribute more and work longer. Same job, same place, different deal.

I live in the same building as other families with little ones. Our 3K lottery number is so bad, theirs is almost definitely better. They will get into the nearby 3K center and we will not. And nothing I can do about it. (Excuse my grieving about this situation right now. I walk by this center almost daily and see it from my window. It is closer to me than the zoned elementary school. I do not think lottery is a reasonable way to distribute basic school seats for 2-3 year olds and their parents as it is fundamentally unfair AND makes it very hard to plan).

You should be frustrated. Not because you pay for it in taxes, nor because your neighbors didn’t get unlucky. But rather because of the ineptitude of the program. It takes a certain level of incompetence in leadership to put together a 3K program where the schools ain’t where the kids are, and to have that continue for years.

This is what happens when people vibe-elect their leadership based on “I like what he has to say”. Never would have happened with Bloomberg. But look what happened with Bloomberg when he tried running for president. Sign of the times.

(With all due respect to American Samoa, where Bloomberg won the primary in 2020.)

>>>You should be frustrated. Not because you pay for it in taxes, nor because your neighbors didn’t get unlucky. But rather because of the ineptitude of the program

I agree with that. And the whole set up of lotteries and uncertainties and submitting applications in January and then waiting for months and not knowing which school if any you got into until the last moment seems to be a really nerve-wrecking feature of NYC DOE. And could definitely be improved.

>>>Sign of the times.

what do you think is different between current times and previous times?

People are more cynical. Politically, financially, medically. Why now? I’m not sure. These things go in decades-long waves, I think, and shift back (I hope!).

nyc_sport>> That model may well be broken with successive generations that do not have a fascination with wealth

Are you saying the current younger generations don’t have a fascination with wealth? I don’t really see it that way and would say the opposite, if anything.

Nada, Without having the concrete data to back it up, politics seems to be driven by wealth concentration, manufacturing type job losses in many areas and grievances. Wealth concentation and grievances driving Mamdani's spending and tax proposals.

To add to that, are we really a rich country with so much national debt and deficits. Just try to wipe out the national debt by taking top x% of total wealth more than $10mm. That iwill point to spending out of control. But no one wants to cut spending as that is political suicide.

>>>Never would have happened with Bloomberg.

I really liked mayor Bloomberg. But he hiked New York City property taxes. And his city did not provide a free 3k program.

There were a few 3K centers in popular areas that were built (money spent!) during prior administrations but never became operational due to budget constraints. Mamdani just opened at least one such center on E65th street. I have it on my list (won't get it since my lottery number is so, so bad, but maybe off the waitlist).

>> Nada, Without having the concrete data to back it up, politics seems to be driven by wealth concentration, manufacturing type job losses in many areas and grievances.

Yeah, I’ve heard that before from various talking heads. It goes beyond politics. Just senseless ignorance of various sorts, usually not to one’s benefit. I ran across this article this morning:

https://www.wsj.com/finance/investing/the-tax-nerd-who-bet-his-life-savings-against-doge-6b59eda2?st=pvGUmN&reflink=desktopwebshare_permalink

The people on the other side of that bet had the magic combination of incompetence in assessing an obvious situation yet were confident enough in their complete misassessment to lay odds.

Thanks. Good article.

What is your take on this? What top percentile do we need to wipe out?
------------------
To add to that, are we really a rich country with so much national debt and deficits. Just try to wipe out the national debt by taking top x% of total wealth more than $10mm. That will point to spending out of control. But no one wants to cut spending as that is political suicide.

>> I really liked mayor Bloomberg. But he hiked New York City property taxes. And his city did not provide a free 3k program.

The point I was making was that when Bloomberg set out to get something done, he’d get it done and done right. He wasn’t big on blabbing on about it.

Since then, I’ve heard a lot of hoopla about 3K. I heard it a few years ago, I still hear it touted now. So successful that it is time to move onto 2K! Bloomberg didn’t have a 2K, tsk tk.

Now I’m not sure if you’re aware, but you don’t actually have a free 3K program. We’ll see if you actually have a free pre-K program next year, I suppose.

Sorry to pile onto your anxiety, but this pisses me off. If you want to take money from me to deliver X for the benefit of 3 year olds, go for it. But for fuck’s sake, actually deliver. Take more if you need, but actually deliver. It’s called “ 3-K for All”, not “ 3-K for All Except Those Unfortunate Toddlers Whose Deadbeat Parents Are Unwilling to Commute an Extra 2 Hours Each Day To Make Use of This Wonderful Program That Allows Them to Have Time to Work”.

It’s like the Dept of Sanitation picking up garbage from two out of every three buildings on each block. The rest can drop off their garbage on available blocks in the Bronx. Sanitation solved!

>> What is your take on this? What top percentile do we need to wipe out?

What do you mean? Zero-ing the national debt (ignoring the further deficits) by taking all-ish of the wealth from the top X% of richest people?

National debt is $38T. The same website I linked earlier has the answer:

https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/table/

$54T of wealth in the hands of the top 1%. I’m guessing you can get to $38T by dropping them to $10M each. It’s a bit cruel, though, as $10M is the new $5M. And as everyone knows, that’s a nightmare:

https://m.youtube.com/watch?v=m0sRrsara9c

Politicians get votes for promising it. A big chunk of voters don't pay much taxes so they vote for more benefits which are 2x the cost due to inefficiency and they don't work well. Yes many European countries have free day-care but they don't make $300-$500k either in a banking job.

Even Bloomberg couldn't run DOE as efficiently as he wanted to due to teacher's union bosses and administrators but he was very good.

The rest of the country does fine without 3k. What is so special about NYC? Couples balance how much their jobs pays vs cost of childcare and time spent with their family. Two busy jobs means 70 hours a week nanny. Cost of doing business and choice of jobs.

I don't think any politician or DOE cares about bankers / private practice lawyers. In my opinion, whole goal of 3k is to provide parenting to kids whose parents aren't educated or incompetent - essentially give poor kids a little more opportunity (at some ridiculous cost).

Yes many European countries have free day-care but they don't make $300-$500k either in a banking job.

------
Since then, I’ve heard a lot of hoopla about 3K. I heard it a few years ago, I still hear it touted now. So successful that it is time to move onto 2K! Bloomberg didn’t have a 2K, tsk tk.

BTW, it is the same DOE and set of parents where many high-schoolers can't perform at 6th grade level. So keep throwing good money at an organization and set of parents who don't have enough to show for existing resources.

People can draw different conclusions depending on their political views. https://www.ibo.nyc.gov/content/publications/achievement-grades-3-8-tps

>> Politicians get votes for promising it.

Promising is fine if you can deliver. People are voting for politicians that promise what they know cannot be delivered. This is the cynicism I’m talking about. When a politician promises something they cannot possibly achieve, people don’t care—even if they know it and/or are told repeatedly. I am reminded of the cab driver Mamdani voter who told my wife he understood that Mamdani can’t do most of the stuff he was promising. But instead of considering that a disqualifying characteristic despite a slate of other candidates, he went with Mamdani.

Same thing at the national level. Trump promised 4-6% GDP growth in 2016 and an elimination of the national debt in 8 years. With fealty from both houses of Congress, he achieve 2.2% GDP growth and a 50% increase to the national debt. When he was running in 2024, he spewed similar nonsense.

I recall my housekeeper saying that some people she knew were voting for him because of the economy. She was like “WTF are you talking about? No one in Washington is going to do anything meaningful to you while you sit around. You’ve gotta make your own economy.”

So it’s a cycle of BS spewed to cynics, a failure to deliver said BS, and then the cynics blame the world when BS doesn’t happen.

There is something amusing about the topic of this thread. Mamdani promises some BA he has now power over (increase income taxes on the rich) to voters who are predominantly non-rich and then turns the tax guns towards the non-rich.

I don’t own, so I don’t actually pay any property tax. The tax on my home is pretty ridiculously high as it is. Nevertheless, if there is a 10% increase and market forces make it somehow 100% passable to me (which I am skeptical of), the amount is a drop in the bucket relative to the originally proposed income taxes increase.

And FWIW, I don’t particularly care about the proposed income tax increase either. I’ve long understood the trajectory of profligacy that comes alongside the cynicism and have planned accordingly.

>> Politicians get votes for promising it.
>>Promising is fine if you can deliver.

I don't think he was elected for promising any specific thing. I think he was approachable and charismatic, represented change, and focused on the right pain points. People felt seen and heard on affordability issues.

>>The rest of the country does fine without 3k.

Really?

>>What is so special about NYC?

One of the highest costs of living in the country and a city with a lot of inequality (which means a good chunk of people are not well off). Childcare / early education is a temporary issue for parents, but serious enough to push people out of the city or moms out of jobs. Not everyone works in finance or Big Law.

As % of income childcare costs are highest in NY vs other states, based on numerous data sources. Here is one:
https://wallethub.com/edu/child-care-costs-by-state/151929

New Mexico is second on that list and they just introduced universal childcare.
https://sourcenm.com/briefs/nm-senate-passes-bill-to-pay-for-universal-child-care/

>>> Take more if you need, but actually deliver.

They have enough seats, but not in the right locations, and that's dumb and infuriating in itself

However, I separately am infuriated about this lottery system for 3K. I get the complex school choice system at middle school and high school level. There are vocational high schools, arts high schools, language focused, high school for the deaf. etc and its great to have all these choices. But 3Ks are actually all almost exactly the same. Same curriculum and set up in every single place. The only variable is the location, and that is the most important variable for a toddler. Elementary schools are in similar boat and are zoned to an address. But 3Ks are not zoned, and the admission process is unnecessarily complicated; 97% of people from downtown or UES or anywhere in District 2 have a priority over us for our neighborhood 3K center just because they have a better lottery number. I will wait months for a placement and then have to play the waitlist game all summer to maybe get in somewhere. The entire time I won't know what the plan is and possibly will need to put in a non-refundable deposit into a private school/daycare just to have a spot come September if nothing works out in public 3K. (I think it was 300 mercer who predicted years ago that the system will try hard to push us into private)

Separately, the system is so complex its like you need a PhD to decipher and navigate. For example, according to myschools website, at our neighborhood center (which we ranked #1), 147 people applied last year and 90 were admitted, based on a lottery number. The 147 applicants allegedly represents only people that ranked this center AND did not get into any school that was higher on their list. Statistically speaking, we will be ranked somewhere 140-147 in the list of applicants given our 97th percentile number and likely have no shot, but we don't know the lottery number distribution among 147 applicants, which could be different form the general population since the list of 147 represents people not admitted higher on their list. What could be more predictive is the cutoff lottery number. DOE repeatedly has refused to provide this information.

One PhD wrote a paper on it, where she documented DOE ridiculous refusals to provide relevant information to the public. Leading me to believe they are hiding something. Probably incompetence.
https://par.nsf.gov/servlets/purl/10437955

Sorry Krolik. DOE administration is massively incompetent and union and ideological driven. Efficienty is not their priority. No one can break it. Charters are little bit of a relief valve. On top of that include parents who don't have their act together. So you gotta suck it up, pay your taxes and expect less in return.

For anyone with both parents working more than 55 hours per week, choices are limited to nannies. Schools close too many days a year and the school day is short. What the f is 2.5 months long summer vacation? It doesn't work with both parents working but no one is going to change this nationwide custom. Most private schools do have a choice for 8-6pm if you pay extra. But they are also closed many days a year. In fact, they follow DOE schedule more or less.

>> 97% of people from downtown or UES or anywhere in District 2 have a priority over us for our neighborhood 3K center just because they have a better lottery number

And I bet you are conveniently nearby their office commute for a good number of them, making yours a nice backup choice. Or #1, if you want to maximize the time between dropping of little Johnny and getting to work.

What a nice, well-conceived design!

https://open.substack.com/pub/matthewyglesias/p/is-a-new-teacher-better-off-in-mississippi?utm_campaign=post-expanded-share&utm_medium=web

Yglesias’s basic argument is that spending more on schools — especially on teacher salaries — doesn’t automatically mean better results. New York spends more per pupil than any other state and pays some of the highest average teacher salaries in the country. But when you look at adjusted NAEP scores, the results are good, not bad — just not dramatically better than places like Mississippi or Louisiana, which spend a lot less and have recently improved a lot.

He also points out that once you factor in New York’s housing costs and tax burden, the pay advantage for new teachers isn’t that impressive. Entry-level salaries are only a bit higher than in lower-cost states, and most of the big money in New York is backloaded into later career pay and pensions. That’s great for veterans, but it doesn’t necessarily help recruit new talent.

On top of that, teachers don’t move between states much anyway. Pension rules make mid-career moves costly, and certification rules don’t help. New York is actually one of only three states that hasn’t signed the interstate teacher certification agreement, which makes it harder for out-of-state teachers to transfer in. So even though New York pays more on paper, it’s not especially easy to attract outside talent.

He also brings up the politics of this. Zohran Mamdani voted in the state legislature for a class-size reduction mandate that will end up costing NYC hundreds of millions per year — over a billion annually once fully phased in. Now as mayor, he’s dealing with the budget squeeze that comes with that. It’s a good example of how it’s often easier to vote for higher spending than to manage the fiscal consequences later.

The bigger theme is tax skepticism. In a high-tax state like New York, people are understandably asking: if we’re already spending more than anyone else, why aren’t the outcomes clearly better? Yglesias isn’t saying “spend less” across the board — he’s saying that if you want to justify high (or higher) taxes, you have to show that the money is being used in ways that actually move the needle.

So now Mamdani is suggesting a drastic estate tax

https://www.bloomberg.com/news/articles/2026-03-13/mamdani-wants-new-york-estate-tax-threshold-cut-90-to-750-000

Clearly, he is seeing a large number of generational free riders, ubiquitous presence of which is gaslighting poor, working and middle classes and contributing to class frictions, which is what I have been pointing out above

But I don't understand how this law wouldn't lead to a mass exodus of wealthier people in practice

I'll advise my shroud maker to leave off the pockets.

Live here for five months and have your legal domicile elsewhere.

@stache - Wouldn't they just design a punitive pied a terre tax?

Maybe NY State and NYC should do what Illinois and Chicago have done: Institute a per-wager tax on sports betting on platforms like DraftKings and FanDuel. It's a $0.25 tax on the first 20 million wagers at each sportsbook. After that, the tax increases to $0.50 per wager. Of course, FD and DK passed on the tax as a flat $0.50 fee per wager, so they're further cleaning up on the first 20m wagers. As a nice side effect, the number of wagers dropped, so you could consider the tax a good public service...

>>>Wouldn't they just design a punitive pied a terre tax?

They should. A property or a pied a terre tax would probably be better than this estate tax proposal. Because properties don't have legs.

Separately, how does it work with Draft Kings and Fan Duel? Aren't these online services? Couldn't a consumer just use a VPN to avoid the tax?

DK and FD have to be issued licenses to operate in IL. As regulated sports book operators, they have to know who their bettors are, so obtain user identification at the time the person signs up. Additionally, they have physical kiosks in some locations (e.g, Wrigley Field, Casino Queen). All betting operators already pay a 15% tax on revenue, and those taxes recently changed, now up to 40% on revenue above $200m. The per wager tax only applies to online, not in person, wagering.
Separately, the prediction markets people (Kalshi, Polymarket) want a piece of this, but of course, don't want to pay the taxes, so claim they're regulated under the CFTC, which they claim overrides any state regulation. CFTC Commissioner Selig, who never met a dollar, crypto-adjacent or otherwise, he wouldn't snuggle up to, is looking to block all state initiatives to regulate prediction markets.

Like everything else, New York has the highest sports wager taxation in the nation. It amounts to 51% of "gross gaming revenues," which is the net wagers less winnings without any other deductions. The tax is paid by the operator. The end user pays income tax on winnings, if any, like any other income.

The legitimate online gaming firms have very sophisticated geo-locating technology that can pinpoint locations within feet.

I never understood the appeal of a pied a terre tax. These folks pay taxes, use no services, spend large sums of money, and often are substantial contributors to philanthropic causes. They are like foreign students paying full tuition at a university with no aid or scholarships. Part of the reason places like Florida survive without income taxes is the large quantity of free-spending, childless residents that require no schools and other child-rearing infrastructure.

>>>I never understood the appeal of a pied a terre tax.

I think it is part punishing a suboptimal use of property which is underutilized in a city where land is very expensive, and part price discrimination: if you can afford a pied a terre, maybe you can afford to pay even more taxes.

>> I never understood the appeal of a pied a terre tax. These folks pay taxes, use no services, spend large sums of money, and often are substantial contributors to philanthropic causes.

Those same words could be said in support of phasing out income tax beyond a certain level. Or property taxes, for that matter.

A pied-a-terre tax seems like a potential workaround to income taxation on non-residents. Non-residents spending 40% of their time or whatever in NYC don’t pay any income tax, and this could sorta equalize them toward 40% as a class.

>>>New York spends more per pupil than any other state and pays some of the highest average teacher salaries in the country.

Sure, but we also have some of the highest cost of living in the country. Adjusted for the cost of living, how does teacher compensation compare?

Aside from relatively high teacher comp what do you think drives the high cost per pupil in NYC?

It's just compensation imo. Unions stack the deck. Teachers are scarce relative to demand. That's due to union-enforced credentialism and poor starting pay. Why not teach in Scarsdale or CT? Teacher pay is backloaded so only after you're burnt out and ready to move on do you start earning enough to give you pause. It's the overall compensation package that's expensive, not salaries alone: great pension, gold plated insurance, absolute job security (short of setting fire to the school). It only starts to look good 15 years in. Unions are built for and around them.

Have you ever heard Randi Weingarten speak? She should program bots. If she isn't in fact a bot hologram herself.

Another op ed about the taxes driving people to other states:

https://www.wsj.com/opinion/states-taxes-migration-democrats-irs-f13d9d04?st=gWyqML&reflink=desktopwebshare_permalink

The drumbeat of state tax op eds got me thinking… why don’t we ever see any such op eds on federal taxes anymore? Top income earners pay ~40% to federal and an incremental ~10% to NYC/NYS (assuming they are business owners or partners). Shouldn’t there be some airtime spent on the bulk taxer in the “welfare state”?

Nada, We do see many articles about increasing federal deficits and entitlement spending.

And then with state income taxes people have some choices to move but clearly less than with federal taxes.

In addition, most very wealthy aren’t paying on unrealized capital gains which makes effective tax rate much lower if you factor unrealized gain into income. And capital gains is only 23.8 percent. That is another reason why you don’t hear much revolt from billionaires on Federal income taxes.

Clearly on Federal level, we as a nation are under taxed vs crazy level of federal spending per person on healthcare.

Reposting with correction:

Nada, We do see many articles about increasing federal deficits and entitlement spending.

And then with state income taxes people have some choices to move but clearly not much at national level.

In addition, most very wealthy aren’t paying on unrealized capital gains which makes effective tax rate much lower if you factor unrealized gain into income. And capital gains is only 23.8 percent. That is another reason why you don’t hear much revolt from billionaires on Federal income taxes.

Clearly on Federal level, we as a nation are under taxed vs crazy level of federal spending per person on healthcare.

And imagine what would happen if Federal govt / Congress increased Medicare and social security tax rate automatically on every one to match spending. Essentially a balanced budget law.

I think taxing unrealized capital gains is a terrible idea. On paper, I’ve made over $200k from my investment portfolio. So even though it’s just on paper and not in my wallet, the government should be allowed to tax it?? What happens if my stock portfolio goes down? Will I get a refund? Why stop there, why not have Uncle Sam tax people on how much their house has gone up in value even though they are still living in it? Government needs to rein in spending before they get crazy ideas like taxing unrealized capital gains.

Turbo, How will Federal Govt rein in spending on healthcare? It is not that they are promising new benefits and spending items like Mamdani, it is the cost of existing benefits at Federal level. As Nada has pointed out the votes don’t want the healthcare system, which results in 50 percent more spending per person vs other developed counties, to change.

On wealth tax, simply put a minimum threshold for taxation at say $25mm ex non investment real estate as that is already taxed in somewhat of a wealth tax fashion. Income tax on actual realization of gains is to be adjusted for the wealth tax already paid. Naturally this raises the question of non public asset valuation. That is a hard one. The problem is that individual are not contributing enough for their benefits. So any changes like wealth tax has to be accompanied by social security and Medicare tax increase commensurate with spending. Basically every one pays more.

>> Nada, We do see many articles about increasing federal deficits and entitlement spending.

I was talking about op eds specifically, not articles. For example, here’s another one from the WSJ last week about state taxes only:

https://www.wsj.com/opinion/democrats-raising-taxes-zohran-mamdani-gavin-newsom-bernie-sanders-0993b2ad?mod=author_content_page_1_pos_22

>> And then with state income taxes people have some choices to move but clearly not much at national level.

If I were going to move because of taxes, Puerto Rico would have been the target. Why pussyfoot around on the margins of state & local when you can put federal taxes at play? Go big or go home.

Ha. Puerto Rico is a good one but even Puerto Ricans want to move out of there.

>> I think taxing unrealized capital gains is a terrible idea. On paper, I’ve made over $200k from my investment portfolio.

It might be a terrible idea, but there are easy answers to all those questions with respect to your public investment portfolio.

>> So even though it’s just on paper and not in my wallet, the government should be allowed to tax it?

I find your use of “should” incongruous. I think government taxation is a lot more about “what can we tax” than “what is just to tax”. With liquid, public securities, it is pretty easy to sell a portion of holdings to pay tax obligations. With illiquid assets, not so much. Drawing the line is difficult. Suppose you have a pass through investment vehicle (e.g., an LLC) with liquid assets. How much does the LLC sell each year and distribute so investors can meet their tax obligations? Some investors are in a higher bracket, some are in a lower bracket. Some will prefer to pay the taxes out of other income, some won’t.

>> What happens if my stock portfolio goes down? Will I get a refund?

Refund? Hahahaha. I’ve only ever seen refunds on overpayments. More likely that you’d get a loss carryforward, just as happens with realized losses.

>> Why stop there, why not have Uncle Sam tax people on how much their house has gone up in value even though they are still living in it?

Therein lies the rub. Taxing illiquid assets creates impracticalities that are too hard to overcome. And if you try to tax only public liquid assets, there will be a push towards privatization, either of the companies directly or else structures that essentially hold the stocks with sufficient degrees of illiquidity.

Another problem is that the revenue stream is too lumpy. You also get undesirable direct links between government interest rates and the market. Market goes down => govt doesn’t get revenue => govt need to borrow more => interest rates go up; not a dynamic you want if the market drop is because of recession.

On Illiquid: CA has some ideas not sure how good.

https://www.foley.com/insights/publications/2026/03/californias-proposed-2026-billionaire-tax-act-what-you-need-to-know/

I’m glad you bring up California. If these ideas are from Sacramento then they are probably no good. A half-dozen billionaires have already fled the state in anticipation of this tax. Here is what frustrates me to no end (it’s not limited to California), the state has spend billions of dollars of tax payer money over the past several years on (just to name two examples) on a proposed high speed train between LA and SF and combating homelessness (again just two examples). There has been virtually no progress in either area, just a ton of money spent. As I have spend significant time in both LA and San Francisco over the past 13 years , the homeless problem in these cities has not improved. Just visit skid row or tenderloin to see for yourself. An if I’m not mistaken, not a single track has been laid between the two cities for that high speed train. I don’t sense any outrage or accountability in California for these colossal wastes of money. Yet we must somehow increase taxes because apparently we are running out of money. Combatting homelessness and improving transportation are absolutely worthy causes that our tax dollars should fund. But there needs to be much better accountability on how that money is spent and there should be clear evidence of progress and improvement, not just continuing to shovel money at the same problems with no foresight thinking that magically thinks will get better. Bottom line: when it’s your money, you’re pretty careful how you spend it. When it’s someone else’s money, not so much.

On more articles about the state taxes going up in WSJ editorials:
1. WSJ is conservative. So they will oppose any tax increase and will focus on spending reduction. And there indeed have been many editorials about out of control Medicare spending and entitlement fraud. The reality is that they should also be talking about social security and Medicare taxes not being enough to fund entitlements. There has been good coverage about debt and deficits. But not enough about the need to increase the revenues at the federal level.

2. There are many states which are increasing the taxes and only one Federal govt. There is just more news about states in sheer numbers.

3. Then there is easy comparison of govt budget per capita in FL, TX vs NY and NJ.

Everybody's in on the homeless services/drug rehab gravy train.

It is obvious to focus on state and local taxation because (a) it is easily avoidable, (b) it is wildly wasteful, and (c) it is fairly unique to the U.S., at least on income tax level. New York spends the third highest per capita in the U.S. after only two states with massive natural resource revenues that each must spend (Alaska and Wyoming). And, that is state-wide, never mind the much higher per capita spending in NYC. Plus, the overall state and local tax burden approaches the total per capita federal tax burden in high tax states (recent data is hard because of COVID, but it is on the order of $16k per person spending in NY and $19k/person federal). Over 16% of New York's workforce is government employees. The waste is staggering.

16% - that's like Germany without comperable results.

I could live with a national sales tax. Apparently it's a reliable source for government revenue. There's no getting out of it. You'd have to start small - 2% to help bring down the deficit.

Here’s a curious thing to think about regarding NY vs FL in terms of govt spending per capita. Much hay has been made about NY spending twice as much per capita as FL. But GDP per capita in NYC is 1.6x that in FL. So on a GDP-adjusted basis, it’s not as bad as it’s made out to be. (But not comparable either.)

Now you might say, who cares about the number on a GDP basis? Dollars is dollars! But under that perspective, the profligate FL govt spends 70x per capita compared to Bangladesh.

nyc_sport>> Plus, the overall state and local tax burden approaches the total per capita federal tax burden in high tax states (recent data is hard because of COVID, but it is on the order of $16k per person spending in NY and $19k/person federal).

There’s a bit of double-counting in that, I believe. About $4-5K of that NY spending is coming from federal receipts. So more like $11-12K of NY-sourced spending and $19K of federally-sourced spending, of which $4-5k is sent from federal to NY to spend (primarily on Medicaid and social services).

It also seems to me that state taxes are much more broad-based than federal. I personally pay ~2.5-4.0x as much taxes to federal than I do to NY, depending on how you count it. But federal spending is 1.6x the amount in NY, after accounting for federal program dollars sent to NY.

>>>I could live with a national sales tax. Apparently it's a reliable source for government revenue. There's no getting out of it.

This is not a great option for taxes. It burdens the poor and the middle class a lot more than wealthy people because they spend more of their income. And you CAN easily get out of it. The rich will shop in duty free/other geos. They'll go to Dubai to buy their next boat with zero tax, while the poor will have to pay taxes on a can of tuna.

Based on two key criteria: not over-burdening the most vulnerable, and not causing undesirable distortions in behavior, I believe property and estate taxes are some of the best options (but estate taxes cannot be too different from neighboring states).

In Canada and Europe the poor get a rebate at the end of the year - there's a sytem in place.

why do you think a sales tax is a good tax system? what are the pros?

I am told it fluctuates less. It's transparent. It's difficult to avoid. Seems to works in Europe and Canada where people enjoy a decent standard of living. Yes, you end up weighing little purchases more. And Americans do like to consume a lot.

I was told ages ago French women would buy 1 well cut cocktail dress or coat or whatever every year or every couple of years and then wear it for years. Their closets weren't stuffed to bursting and they threw out less. I'm sure it has changed. But why not 1 Yves St Laurent every year or two rather than 5 J Crew every year?

I guess if you consume less you sap growth but as an individual or breadwinner you are in control of what you pay by consuming more or less. I don't like end of year or even end of quarter surprises.

European states tax food, staples, medicines at much lower rates. They also provide energy and housing vouchers based on income.

Poor and working class Canadians get a flat, quarterly benefit based on income.

I think most economists like the VAT.

How about spending a little less and ensuring results commensurate to existing spending?

And then every one pays more to address the deficit so there they have less incentive to vote for more free goodies.

Simplest solution at federal level is to keep increasing social security and Medicare tax in line with the entitlement spending.

States and cities already have sales tax which they can increase, reduce out of control discretionary spending, and ensure commensurate returns on existing spending.

You can’t just continue to point fingers at the rich.

For the stratospherically rich NY taxes are probably a rounding error but for a percentage of them any saviings is enticing:

https://www.wsj.com/opinion/states-taxes-migration-democrats-irs-f13d9d04?st=HtrHXy&reflink=desktopwebshare_permalink

>> States and cities already have sales tax which they can increase, reduce out of control discretionary spending, and ensure commensurate returns on existing spending.

I think the Federal government is more out of control. States & municipalities spend (on average) 14% of GDP, without structural deficits, and carry 22% of GDP in debt. So debt is 1.6x the tax revenue. Federal spends 24% of GDP, 6% of which is deficit-based and has basically become structural. Meanwhile, debt is 124% of GDP. Since tax revenue is only 18% of GDP, debt-to-revenue is 6.9x and growing.

At the end of the day, I am more concerned by the Federal govt. They’re the elephant in the room, the one with the greatest problem. They’re also the one with the greatest lever: not only can they tax, but they can also inflate the currency. I am not hopeful for a responsible resolution because voters have been on a pattern of gleefully, knowingly putting irresponsible people to run the govt. This is across the board—whoever spews the biggest nonsense wins. Trump and Mamdani are two sides of the same coin; I’m not surprised they got along so famously.

So when I see these repeated articles about state taxes, and people looking to moving to another state to “solve” the problem of the govt overreach for profligate spending, I think “Guys, you’re missing the big picture”.

I agree but as another commenter noted, it’s much easier to move to another state with the no state income tax than move out of the United States and renounce US citizenship. If more people actually took this action, I’m sure you would read articles about it. Interestingly I’ve read many articles on Americans moving abroad and it’s usually not for tax reasons as they don’t take the additional step of giving up their passport. The reasons I most often see are quality of life, better and more affordable healthcare, less guns, less crime. But i can imagine if these places also have a lower cost of living and you save a ton on healthcare, maybe you’re still fine paying US taxes. But even though one can’t do anything about Federal taxation, for many people, the tax savings moving to Florida or Texas from NY or California can be significant and as many have noted, the migration is real whether the Governors of these high tax states want to acknowledge it or not.

@911Turbo We moved to France and the healthcare system is far superior to the US and much cheaper and efficient. Quality of life is better and, of course, the food. The expat community is growing. Is it a permanent lifestyle change for us? Who knows. But we are certainly enjoying it right now. I would never give up my US passport so we still pay our US taxes but since we’re retired it’s not much.

>> I agree but as another commenter noted, it’s much easier to move to another state with the no state income tax than move out of the United States and renounce US citizenship.

That’s not the way I look at it, and it’s that type of thinking that I find ill-directed. Living in NYC the past 20+ years, I kept ~50% of my earned income. In FL, I’d have kept 60%. So nominally, I’d have earned 16% more after-tax if I had moved to FL.

But could I have been paid the same in FL? Maybe in Year 1 I could have finagled something. But by Year 20+, it’d have been super unlikely to have seen the exponential growth I’ve seen in NYC had I been in FL. This is not because NYC is a place where they like paying too much. It’s because I can create value commensurate with the pay, partially as a result of the environment.

Observe a bartender in NYC versus a bartender elsewhere. The have the ability and customer base to make drinks at 2-5x the speed of other cities. It’s amazing to watch.

But the real focus should not be on earned income. Rather, it should be on focusing on long-term, tax-free compounding of high savings at high rate of returns. That’s where people should be spending their attention on, IMO, not non-compounding tax issues like relative taxes in states. Yes, NYC-ers pay twice as much tax as FL-ers. But it’s on 1.5x the earned income, so as a percent it’s not terribly worse. And more importantly, it doesn’t compound.

The problem with moving abroad is all other the Americans who keep showing up. It denatures a place until it feels quite different from the place you moved to.

I suspect there’s a tendency for people going to foreign countries to choose the equivalent of Times Square and then get surprised by all the tourists that keep showing up.

@inonada You are correct. There are certainly "expat ghettos" in popular cities like Paris that are overrun by tourists. But it’s easy enough to live in a local neighborhood away from that like we are doing.

What was the property tax increase under Bloomberg?

Hint:
Over 100%

Cutbacks?
If all that was done was to cut back the size of NYPD to be equal to the SECOND largest police department in the Country? That's $7.3 billion right there.