De Blasio Road Trip Missed Chance To Learn Truth Of NYC's Success
Mayor Bill de Blasio spent the past month hopscotching the country to teach the rubes how to be progressive. One place he didn't stop was Chicago. The Windy City would've had a different lesson for him: what NYC-style progressivism looks like without millionaires and billionaires to pay for it.
Chicago has only 2.7 million people to our 8.4 million. But we're both interesting cities — with museums, parks, zoos, bike share, architecture and waterfront condos.
And Chicago's mayor, Obama White House alum Rahm Emanuel, says he's a progressive. Some of his policies look like de Blasio's. Emanuel wants a $13 minimum wage, de Blasio wants $15. Emanuel is doing pre-kindergarten, too.
But there's a difference: New York is a progressive city with money.
De Blasio's spent his first year and a half in office giving out multibillion-dollar raises, rolling out his pre-K program and giving more cash to public housing and the MTA.
The big budget debate is whether we should add 1,000 cops; $25 billion in annual pension, employee and retiree health care and debt costs? Who cares?
Meanwhile, Emanuel struggles to pay the bills.
Last week, bond-rating firm Moody's slashed Chicago's debt to junk — down there with Detroit. “A cut below investment grade ... impl[ies] there is material risk [of] the city not paying its bondholders on time or in full,” muni-bond researcher Matt Fabian told The Chicago Tribune.
A Moody's competitor piled on, warning Chicago to figure out its “liquidity pressures.” (A “liquidity pressure” is when you can't pay your rent without going out to eat with your friends, paying by credit card and pocketing your friends' share in cash.)
What's the problem? The immediate problem is pensions.
Chicago can't afford them, and a court struck down Illinois' attempt to deal with the problem statewide.
Chicago has skimped on its pension funds to such an extent that lots of younger Chicago employees, and perhaps older ones, too, will never get the full pension payments their employer and their union representatives are still promising.
Yes, the judge can tell elected officials to pay — just as judges can tell poor dads all around the country to pay child support. Court rulings aren't cash, and they don't feed children or retirees.
But why can't Chicago pay — giving everyone everything, just as New York does? Because it's not as rich as New York.
Gotham has 219,635 households that make more than $200,000 a year, according to the Census. That's more than four times Chicago's 54,491. It's 30 percent more than Chicago when adjusted for adult population.
What about millionaires? New York is No. 4 in the world in “millionaire density,” says rich-people magazine Spears.
These rich folk pay a huge chunk of New York's taxes.
New York, unlike Chicago, has its own personal income tax — and the 1.2 percent of city taxpayers who make more than $500,000 a year pay nearly half of it.
That means about 44,000 New York families will pay slightly more than half of our $8.8 billion pension bill this year.
Sure, Chicago could impose an income tax, like New York does. But it wouldn't have the super-wealthy taxpayers to shoulder a big chunk.
Middle-class taxpayers would pay it — just as they already pay sales and property taxes higher than ours.
Ironically, Chicago has a slightly bigger middle class than New York has, with 5 percent more households making between $35,000 and $75,000.
But middle-class taxpayers can't pay progressive-level taxes, at least not at rates they've been willing to accept in the past. (Do Chicagoans want to pay a 20 percent sales tax? They didn't like Emanuel's idea to hike their property taxes.)
The state can't bail Chicago out. Illinois has 52,600 fewer private-sector jobs than it had before the 2008 economic crisis. Thanks only to New York City's amazing recovery — Chinese tourists and the like — New York state has 459,400 more jobs.
To lesser mortals around the country, then, de Blasio must look not like the man who came from the brave new future, but like the clueless rich guy who wonders why poor people don't buy steak dinners if they're so hungry.
He also looks arrogant. New York's been lucky for over 30 years. Luck is not a permanent condition.
This piece originally appeared in New York Post
This piece originally appeared in New York Post