The nightmare descent of New York City under Mamdani rule has begun.  Defunding the police, “free” services, and antisemitism are the tip of the spear.  Staffing, policies, and mandates will issue from the mayor daily, implemented by an administration of hardcore socialists.

The outlook is far worse when measured in dollars and cents.  Spending will soar from already unsustainable levels, even as the tax base exits.  When the top 1% leave, along with major financial firms, they never return.  The glory of New York will fade.  The city will not even be able to sustainably pay its bills for basic services. 

As they used to say in grade school, show your work.

It is typically claimed that New York contributes far more to the federal government than it receives in federal aid.  The implication is that New York is impervious to federal cut-offs and holds the financial moral high ground. 

Hogwash. 

New York City pays nothing to the federal government.  The so-called contribution, totaling an estimated $60 billion, excluding Social Security payments, is the individual income tax dollars paid directly by NYC residents to the U.S. Treasury.  None of these payments has anything to do with the city budget.  The federal government will receive these revenues regardless of where people reside. 

What matters is the NYC budget and the source of revenues.

In 2025, NYC’s budget totaled $119.8 billion.  The city starts the Mamdani-era madness with a forecasted annual deficit of $5 billion to $6 billion, with no answers how to fill this gap.  Factor in the city’s dependence on $10.5 billion in direct payments from the federal government.  President Trump says he will lower that number to the legal minimum.  Mamdani insists that no cuts can be made, that these payments are inviolate.  He is about to learn that U.S. taxpayers are not obligated to subsidize the schemes of the Democratic Socialists of America (DSA).

Even greater danger lurks.  NYC stays afloat, financially speaking, only due to an additional $20.7 billion in annual direct aid from New York State.  Why would this money be at risk, given the prospect of endless state Democrat rule?  Because it is a shell game all the way down.

N.Y. State itself is forecasting $27 billion in unfunded deficits over just three years, 2027–2029.  Forty billion dollars in state debt must mysteriously appear, for an unprecedented increase in outstanding debt by 2029, from $56.5 billion to $95.6 billion.  In the words of the state’s own controller, Thomas DiNapoli, “the vast majority of State-supported debt outstanding has been — and is projected to continue to be — ‘backdoor borrowing’ issued by public authorities, which circumvents the constitutional requirement for voter approval of State debt.”  That is a sentence worth rereading.  New York State funds itself in knowing, continuous violation of the state constitution, to avoid the will of the people.

Now consider potential federal budget cuts.  Direct payments from the federal government to New York State in 2025 total $98.5 billion, or a whopping 40% of the State’s total $246.7-billion budget.  The state already knows that federal payments are slated to decline by $5 billion over the coming years.  Further declines are inevitable, not due to President Trump, but reflecting the reality of an overwhelmed federal budget, now $37 trillion in debt.  Yet into this morass Mamdani bases his mayoralty on outright defiance of the federal government, President Trump in particular.  Polymarkets is open for betting.

Put simply, by any normal accounting, New York State is using federal funds to pay $21 billion to NYC.  By the same standard, New York City too is presently bankrupt, in the old-fashioned sense that it cannot pay for its extravagant spending, collecting $86.8 billion in total revenue versus outlays of $119.8 billion.  The $31 billion needed annually by New York to survive comes, directly or indirectly, from the federal government.  That will not last.

But all this is mere prelude to the Mamdani tax-the-rich onslaught about to hit New York City.  The numbers are frightening.

At the individual level, in a city of 8.5 million people and 4 million taxpayers, the top 1%, or some 40,000 individuals, account for an estimated 45% of the city’s total $17.4-billion personal income tax receipts.  While the New York Post talks of 1 million potentially exiting New York, it is highly likely that at least half of high-income taxpayers will choose escape over life in Mamdani New York.  So goes roughly $4 billion, from a mere 20,000 departing for greener pastures.  Others are sure to follow.  Seventeen point four billion dollars will be the high-water mark for New York City personal income tax revenue.

It gets markedly worse when businesses choose to exit New York, especially financial firms.

The city collects roughly $13 billion in direct taxes on businesses, but the impact of business exit would be far greater, as associated spending ripples through the economy, conservatively tying $30 billion in city tax revenue to business-driven activities.  Ten major financial firms alone could reduce NYC tax revenue by $5 billion.  The city is at enormous risk, made all the greater by the well understood impact of technology.  At a minimum, no financial firm needs to be in New York any longer, especially when the most needed 1,000 firms are specifically targeted by Mamdani for sharply higher taxes.

Think of it.  On top of already record-high taxes, 40,000 individuals are being told they, and they alone, will pay $4 billion in incremental annual taxes.  Likewise, the 1,000 businesses most responsible for sustaining New York City will now face a $5 billion yearly tax increase.  Or they can save $9 billion annually, plus more in existing taxes, by simply relocating in the beautiful U.S. of A., all the while flipping a New York bird on the way out.  Mamdani is a fool or a liar (he could well be both) to claim that neither has alternatives.  The Mamdani $9 billion will “unexpectedly” fail to raise anywhere close to expectations, even assuming New York State sees fit to authorize this suicide mission. 

Put it all together, and New York City revenues are likely to decline, permanently, by at least $10 billion due directly to Mamdani’s actions, adding to $5.5 billion in structural deficits, on top of an already slapdash concoction of sticks and glue that is New York State, made worse by implementation of devastating, and costly, Democratic Socialist Party principles, with President Trump vowing to restrict federal spending to the “bare minimum required by law.”

At the same time, NYC spending will explode as Mamdani implements his absurdist vision of universal childcare, free buses, and city-run grocery stores.

The harsh reality is that the Mamdani cataclysm will not be shouldered by Mamdani.  It will be felt in every corner of the city, worst of all for the working class he pretends to champion.

So call it as it is.  Mamdani is a demagogic, antisemitic, anti-American socialist nepo baby vying to be the future of the Democrat party.  He and his backers are ruled by the Marxist-Leninist master belief, “the worse, the better.”  They affirmatively want leading corporations and the wealthiest 1%, including Democrats, to leave.  Level New York.  Reduce property value to Detroit size.  Everyone has nothing, totally dependent on government.  That is the goal, spun for the gullible as “affordable New York.”

Image via Picryl.